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Home My WebLink About2010 CON JPFA / NATIONAL CITY - Bank of America Lease Financing $3,115,000CITY OF NATIONAL CITY AND NATIONAL CITY JOINT POWERS FINANCING AUTHORITY $3,115,000 LEASE FINANCING WITH BANK OF AMERICA, N.A. CLOSING TRANSCRIPT SEPTEMBER 28, 2010 NIXON PEABODY',, PARTIES City of National City (the "City") National City Joint Powers Financing Authority (the "Authority") Claudia G. Silva, Esq., as City Attorney and General Counsel to the Authority ("City Attorney and General Counsel") Urban Futures, Inc., as Financial Advisor Southwest Securities, as Placing Agent Union Bank, N.A., as Trustee (the "Trustee") Bank of America, N.A., as Assignee (the "Assignee") Nixon Peabody LLP, as Assignee's Counsel Stewart Title Guaranty Company, as Title Insurer Tab No. INDEX Document Basic Legal Documents Certificate of the City Regarding Resolution attaching a certified copy of Resolution No. 2010 — 217 of the City Council of the City entitled "Resolution of the City Council of the City of National City (1) Authorizing Proceedings to Refinance $3,280,000 Outstanding 1998 Lease Revenue Bonds; (2) Terminating the 1998 Lease Agreement between the City, the National City Joint Powers Financing Authority, and Union Bank of California; (3) Approving the New Lease Agreement between the City and the National City Joint Powers Financing Authority; (4) Approving the Assignment Agreement between the Authority and the Lender; and (5) Approving the Irrevocable Refunding Instructions given by the City to the 1998 Trustee. With this Refinance, the General Fund will Realize a Direct Savings of $137,000 in FY 10-11" passed and adopted on September 21, 2010. 2. Certificate of the Authority Regarding Resolution attaching a certified copy of Resolution No. 2010 — 2 of the Authority entitled "Resolution of the National City Joint Powers Financing Authority (1) Terminating the 1998 Lease Agreement between the National City Joint Powers Financing Authority, the City of National City, and Union Bank of California; (2) Approving the New Lease Agreement between the City and the National City Joint Powers Financing Authority; and (3) Approving the Assignment Agreement between the Authority and the Lender. With this Refinance, the General Fund will Realize a Direct Savings of $137,000 in FY 10-11" passed and adopted on September 21, 2010. 3. Termination Agreement, dated as of September 1, 2010, among the Authority, the City and the Trustee. 4. Lease Agreement, dated as of September 1, 2010, between the Authority and the City. 5. Assignment Agreement, dated as of September 1, 2010. between the Authority, as assignor, and Bank of America, as assignee. Authority Documents 6. Notice as to a Joint Powers Agreement, including any and all amendments thereto, as certified by the California Secretary of State. 7. Statement of Facts Roster of Public Agencies Filings, as certified by the California Secretary of State. 8. Certificate Regarding Effectiveness of Joint Exercise of Powers Agreement, together with Joint Exercise of Powers Agreement, dated as of April 1, 1991, by and between the City and the Community Development Commission of the City, and any and all amendments thereto. 1 Tab No. Document 9. Certificate Regarding Effectiveness of Rules and Regulations, together with Rules and Regulations of the Authority and any and all amendments thereto. 10. Officer's Certificate of the Authority. 11. Internal Revenue Service Form 8038-G. 12. Conditional Notice of Full Redemption. City Documents 13. Officer's Certificate of the City. 14. Irrevocable Refunding Instructions, dated as of September 28, 2010. 15. Custody Agreement for Public Funds, executed by the City and accepted by the Trustee. 16. Evidence of Property Insurance, as required by Sections 5.3, 5.4, 5.5 and 5.6 of the Lease Agreement, together with Certificate of Insurance, Memorandum of Insurance and Endorsement. 17. CLTA Title Insurance Policy insuring the Assignee's interest in the estate, issued by Stewart Title Guaranty Company, pursuant to Section 5.7 of the Lease Agreement. 18. Costs of Issuance Requisition of the City. Trustee Documents 19. Incumbency Certificate of the Trustee, together with certified general signing resolution. 20. Certificate of Trustee. 21. Trustee's Receipt of Funds for Deposit in the Bond Fund. Legal Opinions 22. Opinion of General Counsel to the Authority. 23. Opinion of City Attorney. Miscellaneous 24. Report of Proposed Debt Issuance, with Acknowledgement, and Report of Final Sale of the Lease Financing, each filed with the California Debt and Investment Advisory Commission. 25. Closing Memorandum. 2 $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. CERTIFICATE OF THE CITY REGARDING RESOLUTION I, Michael R. Dalla, hereby certify that I am the City Clerk of the City of National City (the "City"), and that as such, I am authorized to execute this Certificate on behalf of the City. I hereby further certify that attached hereto is a true and correct copy of Resolution No. 2010 — 217 entitled " RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY (1) AUTHORIZING PROCEEDINGS TO REFINANCE $3,280,000 OUTSTANDING 1998 LEASE REVENUE BONDS; (2) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE CITY, THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, AND UNION BANK OF CALIFORNIA; (3) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; (4) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER; AND (5) APPROVING THE IRREVOCABLE REFUNDING INSTRUCTIONS GIVEN BY THE CITY TO THE 1998 TRUSTEE. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11" (the "City Resolution") adopted at the regular meeting of the City Council held on September 21, 2010, of which meeting all of the members of the City Council had due notice and at which meeting a quorum was present and acting throughout. I hereby further certify that the City Resolution has not been modified, amended, supplemented, rescinded or repealed and is in full force and effect on and as of the date hereof. [Signature Page Follows] 13145742.3 IN WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. CITY OF NATIONAL CITY By: Mi City Clerk c ael R. Dalla 13145742 [Certificate re City Resolution] RESOLUTION NO. 2010 — 217 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY (1) AUTHORIZING PROCEEDINGS TO REFINANCE $3,280,000 OUTSTANDING 1998 LEASE REVENUE BONDS; (2) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE CITY, THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, AND UNION BANK OF CALIFORNIA; (3) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; (4) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER; AND (5) APPROVING THE IRREVOCABLE REFUNDING INSTRUCTIONS GIVEN BY THE CITY TO THE 1998 TRUSTEE. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11 WHEREAS, in order to finance the construction of a Police Administration Building located at 1200 National City Boulevard in the City of National City (the "Facilities"), the City of National City (the "City") has previously leased the real property constituting the site thereof (the "Site") and the completed Facilities from the National City Joint Powers Financing Authority (the "Authority") under a Lease Agreement dated as of October 28, 1998 (the "1998 Lease Agreement"); and WHEREAS, the City's lease payments under the 1998 Lease Agreement (the "1998 Lease Payments") are evidenced by 1998 Certificates of Participation (Police Administration Building Project) which have been executed and delivered in the aggregate principal amount of $6,255,000 of which $3,280,000 are currently outstanding (the "1998 Certificates"); and WHEREAS, the City and the Authority have received a proposal from Bank of America, N.A. (the "Lender"), to provide funds required to refinance the 1998 Lease Payments and the 1998 Certificates; and WHEREAS, the City Council wishes at this time to approve proceedings to refinance the 1998 Lease Payments and the 1998 Certificates and thereby realize interest rate savings to the City, and to approve related documents and actions. NOW THEREFORE, BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF THE CITY OF NATIONAL CITY AS FOLLOWS: 1. Approval of Refinancing Proceedings. The City Council hereby approves the refinancing of the 1998 Certificates and the related 1998 Lease Payments. To that end, the City Council hereby approves each of the following agreements in substantially the respective forms on file with the City Clerk together with any changes therein or additions thereto deemed advisable by the City Manager, and the execution thereof by the City Manager shall be conclusive evidence of such approval: • Termination Agreement among the City, the Authority, and Union Bank of California as trustee for the 1998 Certificates (the "1998 Trustee"), whereby the City, the Authority and the 1998 Trustee agree to terminate the 1998 Lease Agreement and the related Assignment Agreement. Resolution No. 2010 — 217 Page 2 • Lease Agreement between the City and the Authority, whereby the Authority leases the Site and Facilities to the City in consideration of the payment of semiannual lease payments by the City as rental for such real property. • Irrevocable Refunding Instructions given by the City to the 1998 Trustee, whereby the 1998 Trustee agrees to establish an irrevocable escrow fund to be held and invested for the purpose of paying the principal and interest represented by the 1998 Certificates, and to prepay the 1998 Certificates in full on the prepayment date specified therein. The City Manager is 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 documents. 2. Approval of Assignment to Lender. The proposal from the Lender to provide financing for the purposes set forth in this Resolution is hereby approved, and the acceptance of such proposal by the Director of Finance is hereby ratified, confirmed and approved. The City Council hereby approves the assignment by the Authority to the Lender of certain of its rights under the Lease Agreement, including the right to receive and enforce payment by the City of all lease payments due thereunder. 3. Official Actions. The Mayor, the City Manager, the Director of Finance, the City Clerk and all other officers of the City are each authorized and directed in the name and on behalf of the City to make any and all assignments, certificates, requisitions, agreements, notices, consents, leases and other instruments of conveyance, warrants and other documents, which they or any of them might deem necessary or appropriate in order to consummate any of the transactions contemplated by the agreements and documents approved under this Resolution. 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 the case such officer is absent or unavailable. 4. Constitutionality, Severability. If any section, subsection, sentence, clause, phrase, or word of this Resolution is for any reason held by a court of competent jurisdiction to be unconstitutional or invalid for any reason, such decision shall not affect the validity of the remaining portions of the resolution. The City Council of the City of National City hereby declares that it would have passed this resolution and each section, subsection, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more section(s), subsection(s), sentence(s), clause(s), phrase(s), or word(s) be declared invalid. 5. Effective Date. This Resolution shall become effective immediately. --- Signature Page to Follow --- Resolution No. 2010 — 217 Page 3 PASSED and ADOPTED this 21st day of September, 2010. on Morrison, Mayor ATTEST: Michael R. Dalla, fify Clerk A•PROVE AS TO FORM: udia G. City Attorney Passed and adopted by the Council of the City of National City, California, on September 21, 2010 by the following vote, to -wit: Ayes: Councilmembers Morrison, Sotelo-Solis, Van Deventer, Zarate. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Mayor of the City of National City, California City CI rk of the City of ational City, California rk of the City?f By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2010-217 of the City of National City, California, passed and adopted by the Council of said City on September 21, 2010. City Clerk of the City of National City, California By: Deputy $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. CERTIFICATE OF THE AUTHORITY REGARDING RESOLUTION I, Chris Zapata, hereby certify that I am the Secretary of the Commission of the National City Joint Powers Financing Authority (the "Authority"), and that as such, I am authorized to execute this Certificate on behalf of the Authority. I hereby further certify that attached hereto is a true and correct copy of Resolution No. 2010-2 entitled " RESOLUTION OF THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY (1) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, THE CITY OF NATIONAI, CTTY, AND UNION BANK OF CALIFORNIA; (2) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; AND, (3) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11" (the "Authority Resolution") adopted at the regular meeting of the Commission of the Authority held on September 21, 2010, of which meeting all of the members of the Authority had due notice and at which meeting a quorum was present and acting throughout. I hereby further certify that the Authority Resolution has not been modified, amended, supplemented, rescinded or repealed and is in full force and effect on and as of the date hereof. [Signature Page Follows] 13145742.3 IN WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY By: Ch apata Secretary 13145742 [Certificate re Authority Resolution] RESOLUTION NO. 2010 — 2 RESOLUTION OF THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY (1) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, THE CITY OF NATIONAL CITY, AND UNION BANK OF CALIFORNIA; (2) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; AND, (3) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11 WHEREAS, the National City Joint Powers Financing Authority (the "Authority") has been organized under a Joint Powers Agreement, dated as of April 16, 1991 (the "JPA Agreement") between City of National City and the Community Development Commission of the City of National City, as a joint powers authority pursuant to the laws of the State of California for the purpose of providing financial assistance to the City of National City (the "City"), and under the JPA Agreement the individuals who act as the members of the City Council of the City constitute the Board of the Authority; and WHEREAS, in order to finance the construction of a Police Administration Building located generally at 1200 National City Boulevard in the City of National City (the "Facilities"), the City has previously leased from the Authority the real property constituting the site thereof (the "Site") and the completed Facilities to the City under a Lease Agreement dated as of October 1, 1998 (the "1998 Lease Agreement"); and WHEREAS, the City's lease payments under the 1998 Lease Agreement (the "1998 Lease Payments") are evidenced by 1998 Certificates of Participation (Police Administration Building Project) which have been executed and delivered in the aggregate principal amount of $6,255,000 of which $3,280,000 are currently outstanding (the "1998 Certificates"); and WHEREAS, the City and the Authority have received a proposal from Bank of America, N.A. (the "Lender"), to provide funds required to refinance the 1998 Lease Payments and the 1998 Certificates; and WHEREAS, the City Council wishes at this time to approve proceedings to refinance the 1998 Lease Payments and the 1998 Certificates and thereby realize interest rate savings to the City, and to approve related documents and actions_ NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY AS FOLLOWS: 1. Approval of Refinancing Proceedings. The City Council hereby approves the refinancing of the 1998 Certificates and the related 1998 Lease Payments. To that end, the City Council hereby approves each of the following agreements in substantially the respective forms on file with the Secretary together with any changes therein or additions thereto deemed advisable by the Chairman, and the execution thereof by the Chairman shall be conclusive evidence of such approval: Resolution 2010 — 2 Page 2 • Termination Agreement among the City, the Authority, and Union Bank of California as trustee for the 1998 Certificates (the "1998 Trustee"), whereby the City, the Authority and the 1998 Trustee agree to terminate the 1998 Lease Agreement and the related Assignment Agreement. • Lease Agreement between the City and the Authority, whereby the Authority leases the Site and Facilities to the City in consideration of the payment of semiannual lease payments by the City as rental for such real property. • Assignment Agreement between the Authority and the Lender, whereby the Authority assigns certain of its rights under the Lease Agreement to the Lender, including the right to receive and enforce the lease payments which are payable by the City under the Lease Agreement. The Chairman is authorized and directed for and in the name and on behalf of the Authority to execute, and the Secretary is hereby authorized and directed to attest the final form of each of the foregoing documents. 2. Official Actions. The Chairman and the Secretary and all other officers of the Authority are each authorized and directed in the name and on behalf of the Authority to make any and all assignments, certificates, requisitions, agreements, notices, consents, leases and other instruments of conveyance, warrants and other documents, which they or any of them might deem necessary or appropriate in order to consummate any of the transactions contemplated by the agreements and documents approved under this Resolution. Whenever in this Resolution any officer of the Authority 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 the case such officer is absent or unavailable. 3. Constitutionality, Severability. If any section, subsection, sentence, clause, phrase, or word of this Resolution is for any reason held by a court of competent jurisdiction to be unconstitutional or invalid for any reason, such decision shall not affect the validity of the remaining portions of the resolution. The National City Joint Powers Financing Authority Board hereby declares that it would have passed this resolution and each section, subsection, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more section(s), subsection(s), sentence(s), clause(s), phrase(s), or word(s) be declared invalid. 4. Effective Date. This Resolution shall become effective immediately. --- Signature Page to Follow --- Resolution No. 2010 — 2 Page 3 PASSED and ADOPTED this 21st day of September, 2010. on Morrison, Chairman A• "ROVES AS TO FORM: I/ -J ! .ia G. City Attorney If Passed and adopted by the Commissioners of the National City Joint Powers Financing Authority, National City, California, on September 21, 2010 by the following vote, to -wit: Ayes: Commissioners Morrison, Sotelo-Solis, Van Deventer, Zarate. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman National City Joint Powers Financing Authority CHRIS ZAPATA Secretary National City Joint Powers Financing Authority I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2010-2 of the National City Joint Powers Financing Authority, National City, California, passed and adopted on September 21, 2010. Secr National City Joint rs ry inancing Authority Usi RECORDING REMESTEdit STEWART TITLE OF CALIFORNIA TO BE RECORDED AND WHEN RECORDE RETURN TO: Nixon Peabody LLP 555 West Fifth Street, 46th Floor Los Angeles, California 90013 Attention: Charles C. Wolf, Esq. DOC 11 2010-0514246 1111111111 11III11IYII111IMIIIYYN IhIIYI11AIIY IIII SEP 28, 2010 8:00 AM OFFICIAL RECORDS SAN DIEGO COUNTY RECORDER'S OFFICE DAVID L. BUTLER, COUNTY RECORDER FEES: 0.00 PAGES: 5220 8 1111111 IIII IIIII IIIII IIIII IIIII 111 IIIII IIIII IIIII IIIII 111 IIIII IIIII IIIII IIII IIII THIS TRANSACTION IS EXEMPT FROM CALIFORNIA DOCUMENTARY TRANSFER TAX PURSUANT TO SECTION 11928 OF THE CALIFORNIA REVENUE AND TAXATION CODE. THIS DOCUMENT IS EXEMPT FROM RECORDING FEES PURSUANT TO SECTION 27383 OF THE CALIFORNIA GOVERNMENT CODE. '70341-335:6 76. TERMINATION AGREEMENT This TERMINATION AGREEMENT (this "Agreement"), dated as of September 1, 2010, is among the NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, a joint powers agency duly organized and existing under a Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, the laws of the State of California (the "Authority"), the CITY OF NATIONAL CITY, a general law city and municipal corporation duly organized and existing under the Constitution and laws of the State of California (the "City"), as lessee, and Union Bank, N.A., as trustee for the within - mentioned 1998 Bonds (the "1998 Trustee"). BACKGROUND: 1. In order to finance the construction of a police administration building located generally at 1200 National City Boulevard in the City of National City (the "Facilities"), the City has previously leased the real property constituting the site thereof, as such real property is described more fully in Appendix A attached hereto and by this reference incorporated herein (the "Site"), from the Authority under an Amended and Restated Lease Agreement dated as of October 1, 1998, a Memorandum of Lease for which was recorded in the Office of the San Diego County Recorder on October, 26 1998, as Document No. 1998-0690922 (the "1998 Lease Agreement"). 13137461.4 5221 2. Interests in the City's lease payments under the 1998 Lease Agreement (the "1998 Lease Payments") are evidenced by the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project) which have been issued and delivered in the aggregate principal amount of $6,255,000 of which $3,280,000 is currently outstanding (the "1998 Bonds"), the proceeds of which were applied to refinance the construction of the Facilities. 3. The City has caused to be deposited with the 1998 Trustee, under Irrevocable Refunding Instructions dated as of the date hereof (the "Refunding Instructions"), an amount of funds which is sufficient to redeem the 1998 Bonds and prepay the 1998 Lease Payments in full, without regard to investment earnings thereon. 4. The deposit made with the 1998 Trustee under the Refunding Instructions constitutes a security deposit for the payment of the 1998 Lease Payments in accordance with the provisions of Section 4.9 of the 1998 Lease. 5. As a result of the deposit and investment of funds under the Refunding Instructions, the 1998 Lease have terminated and title to the real property which is subject to the 1998 Lease has vested in the Authority.. 6. The City has requested the Authority and the 1998 Trustee to enter into this Agreement for the purpose of terminating of record the 1998 Lease and the related Assignment Agreement. AGREEMENT: In consideration of the foregoing and the material covenants hereinafter contained, the City and the Authority formally covenant, agree and bind themselves as follows: SECTION 1. Termination of 1998 Lease. The Authority and the City hereby terminate the 1998 Lease. From and after the date of recordation of this Agreement, the 1998 Lease shall be of no force and effect. SECTION 2. Termination of 1998 Assignment. The Authority and the 1998 Trustee hereby terminate the Assignment Agreement dated as of October 1, 1998, between the Authority as assignor and the 1998 Trustee, a Memorandum of Assignment for which was recorded on October 26, 1998, as Instrument Number 1998-0690923 in the Office of the San Diego County Recorder. From and after the date of recordation of this Agreement, said Assignment Agreement shall be of no force and effect. SECTION 3. Execution of Counterparts. This Agreement may be executed in any number of counterparts, each of which shall for all purposes be deemed to be an original and all of which shall together constitute but one and the same instrument. 13137461.4 2 5222 SECTION 4. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, all as of the date first above written. App.: ed as to F• $ illA audia fl Attest: By Chris Zapata, S , General Counsel Apprgved as to Form: BvI Attest udia Siy City Attorney By /' Mic ael R. Dalla, ity Clerk NATIONAL CITY JOINT POWERS FINANCIlYG AUTHORITY By Ron Morrison Chairman CITY OF NATIONAL CITY, CALIFORNIA By on Morrison Mayor 13137461 3 5223 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California County of C i I j 0(3 n On Q /z3�! t7 e personally appeared fl before me, VIRGINIA M. ORCUTT Commission S 1874998 Notary Public - California g San Diego County My Comm. E fires Dec 26, 2013 Place Notary Seal Above who proved to me on the basis of satisfactory evidence to be the persorerwhose name(s) islafe'subscribed to the within instrument and acknowledged to me that he/sbefthey executed the same in his/hef/tbeir authorized capacity(ies), and that by his/ber/tkteir signature(s) on the instrument the persor>r or the entity upon behalf of which the person,(* acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. (� ,� / Signature �-�.vC t . //J� l� ti— Signature of Notary Public OPTIONAL Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: ❑ Individual ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Top of thumb here Signer's Name: ❑ Individual ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: 02007 National Notary Association • 9350 De Soto Ave.. P.O. Box 2402 *Chatsworth, CA 91313-2402. www.NationalNotaiy.org Item RIGHT THUMBPRINT OF SIGIIER Top of thumb here 5907 Reorder. Call Toll -Free 1-604676-6827 161ic UNION BANK, N.A., as 1998 Trustee By Authorized Officer 13137461 4 5224 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT 5225 State of California County of LOS ANGELES On SEPT 24, 2010 Date personally appeared before me, S. BAYAN • Notary Public , Here Insert Name and Title of the Officer NABEEL BADAWI Name(s) of Signer(s) S. SAYAN Commission di 1788681 _ Notary Public - California Los Argolis County ExpiresFeb 6,2012 Place Notary Seal Above who proved to me on the basis of satisfactory evidence to be the person(s(whose name(,s'is/aFe-subscribed to the within instrument and acknowledged to me that he%helthey executed the same in his/bet/their authorized capacity(iesh and that by his/ber/their signature(a)" on the instrument the person(s); or the entity upon behalf of which the person(,s'acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OPTIONAL Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) Other Than Named Above: Signature of Notary Public Capacity(ies) Claimed by Signer(s) Signer's Name: Individual Corporate Officer — Title(s): Partner — . Limited L.i General 1 Attorney in Fact Trustee Guardian or Conservator i Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Signer's Name: Individual Corporate Officer — Title(s): i Partner — iI Limited _ 1 General C' Attorney in Fact Trustee Guardian or Conservator Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER (op of thutab here nt2007 N ,tmaal Notary Association • 9350 De Soto Ave PO. Box 2402 •Chatsworth. CA 91313.2402. www.NallonalNolary aro Item /5907 Reorder. Call Toll -Free 1-BOOB /6-6H27 APPENDIX A DESCRIPTION OF THE LEASED PROPERTY The Leased Property consists of the following described land located in the City of National City, County of San Diego, State of California, together with all buildings, facilities and other improvements which constitute real property and which are located thereon: PARCEL A: PARCEL(S) 1 AND 2 OF PARCEL MAP NO. 4027, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY AUGUST 21, 1975 AS FILE NO. 75- 224074 OF OFFICIAL, RECORDS. PARCEL B: THE WEST 33-1/3 FEET OF LOTS 7 TO 10, INCLUSIVE, IN BLOCK 13 OF THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP NO. 348, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL C: THE WESTERLY 33 1/3 FEET OF THE EASTERLY 66 2/3 FEET OF LOTS 7 TO 10 INCLUSIVE IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL D: THE EASTERLY 33 1/3 FEET OF LOTS 7, 8, 9 AND 10 OF BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL E: THE SOUTHERLY 100 FEET OF LOT 11 AND THE SOUTHERLY 100 FEET OF THE WESTERLY EIGHT AND ONE-THIRD FEET OF LOT 12 EN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL F: 5226 13137461 A-1 • LOTS 13 THROUGH 17 IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL G: LOT 6, THE NORTH 25 PEST OF LOTS 11 AND 12 AND THE EAST 16 2/3 FEET OF SOUTH 100 FEET OF LOT 12, ALL IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL H: A. PERMANENT EASEMENT AND RIGHT-OF-WAY TO CONSTRUCT, RECONSTRUCT, MAINTAIN, OPERATE AND REPAIR AN UNDERGROUND EMERGENCY GENERATOR FUEL TANK, DESCRIBED AS FOLLOWS: ALL THAT PORTION OF 12TH STREET, LYING NORTHERLY OF BLOCK 13 OF MAP NUMBER 348, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWESTERLY CORNER OF SAID BLOCK 13, BEING ALSO THE NORTHWESTERLY CORNER OF PARCEL 1 OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF SAID PARCEL 1, 75 FEET TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING EASTERLY ALONG SAID NORTHERLY LINE, SIGHT FEET; THENCE LEAVING SAID NORTHERLY LINE, AT RIGHT ANGLES, NORTH SIX FEET; THENCE WESTERLY, PARALLEL WITH THE NORTHERLY LINE OF SAID PARCEL 1, EIGHT FEET; THENCE AT RIGHT ANGLES, SOUTH, SIX FEET TO THE TRUE POINT OF BEGINNING, CONTAINING 48 SQUARE FEET. 5227 13137461 A-2 RECORDING REQUES cu BY STEWART TITLE OF CALIFORNIA TO BE RECORDED AND WHEN RECORDE RETURN TO: Nixon Peabody LLP 555 West Fifth Street 46`h Floor Los Angeles, California 90013 Attention: Charles C. Wolf, Esq. ooca 2010-0514247 IY1p II IIIII INI IIII IIIII Y11I INI IIIII IIIII IVI I1MI SEP 28, 2010 8:00 AM OFFICIAL RECORDS SAN DIEGO COUNTY RECORDER'S OFFICE DAVID L. BUTLER, COUNTY RECORDER FEES: 0.00 PAGES 35 5228 11111111111111111111111111111111111111111 I I I H 111111111111111111111111111111 I I I I I I I I THIS TRANSACTION IS EXEMPT FROM CALIFORNIA DOCUMENTARY TRANSFER TAX UNDER SECTION 11922 OF THE CALIFORNIA REVENUE AND TAXATION CODE. THIS DOCUMENT IS EXEMPT FROM RECORDING FEES UNDER SECTION 27383 OF THE CALIFORNIA GOVERNMENT CODE. 7 3q-335-5-& LEASE AGREEMENT This LEASE AGREEMENT (this "Lease"), dated as of September 1, 2010, is between the NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, a joint powers authority duly organized and existing under the Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, and the laws of the State of California (the "Authority"), as lessor, and the City of NATIONAL CITY, a city and municipal corporation duly organized and existing under the Constitution and laws of the State of California (the "City"), as lessee. BACKGROUND: 1. In order to refinance the construction of a police administration building located generally at 1200 National City Boulevard in the City of National City (the "Facilities"), the Authority has previously leased the real property constituting the site thereof, as such real property is described more fully in Appendix A attached hereto and by this reference incorporated herein (the "Site") and the completed Facilities (collectively with the Site, the "Leased Property"), to the City under the Amended and Restated Lease Agreement dated as of October 1, 1998, a Memorandum of Lease for which was recorded in the Office of the San Diego County Recorder on October 26, 1998, as Document No. 1998-0690922 (the "1998 Lease Agreement"). 13137150.5 • • 5229 2. Interests in the City's lease payments under the 1998 Lease Agreement (the "1998 Lease Payments") are evidenced by the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), which were issued and delivered in the aggregate principal amount of $6,255,000 of which $3,280,000 is currently outstanding (the "1998 Bonds"), the proceeds of which were applied to refinance the construction of the Facilities. 3. The City has determined to refinance the 1998 Lease Payments and prepay the 1998 Bonds, and in order to raise funds for that purpose the City and the Authority have terminated the 1998 Lease Agreement and have entered into this Lease, in consideration of the deposit of funds in an amount required to prepay the 1998 Bonds and the 1998 Lease Payments in full. 4. In order to raise the funds needed for that purpose, the Authority has assigned certain of its rights under this Lease, including the right receive and enforce payment of the lease payments that are payable by the City hereunder, to Bank of America, N.A., under an Assignment Agreement dated as of September 1, 2010, which has been recorded concurrently herewith (the "Assignment Agreement"). 5. The City is authorized to enter into a lease arrangement with the Authority under its municipal affairs powers as a general law city. AGREEMENT: In consideration of the foregoing and the material covenants hereinafter contained, the City and the Authority formally covenant, agree and bind themselves as follows: ARTICLE I DEFINITIONS; RULES OF INTERPRETATION SECTION 1.1. Definitions. All terms defined in this Section 1.1 have the meanings herein specified for all purposes of this Lease. "Applicable Environmental Laws" means and shall include, but shall not be limited to, the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 USC Sections 9601 et seq,; the Resource Conservation and Recovery Act ("RCRA"), 42 USC Sections 6901 et seq,; the California Hazardous Waste Control Law ("HWCL"), California Health & Safety Code Sections 25100 et seq,; the Hazardous Substance Account Act ("HSAA"), California Health & Safety Code sections 25300 et seq,; the Porter -Cologne Water Quality Control Act (the "Porter -Cologne Act"), California Water Code Sections 1300 et seq,; the Air Resources Act, California Health & Safety Code Sections 3900 et seq,; the Safe Drinking Water & Toxic Enforcement Act, 13137150 -2- California Health & Safety Code Sections 25249.5 et seq,; and the regulations under each thereof; and any other local, state, and/or federal laws or regulations, whether currently in existence or hereafter enacted, that govern: (a) the existence, cleanup, and/or remedy of contamination on property; (b) the protection of the environment from spilled, deposited, or otherwise emplaced contamination; (c) the control of hazardous wastes; or (d) the use, generation, transport, treatment, removal, or recovery of Hazardous Substances, including building materials. "Assignee" means Bank of America, N.A., as assignee of certain rights of the Authority hereunder, its successors and assigns. "Assignment Agreement" means the Assignment Agreement dated as of September 1, 2010, between the Authority as assignor and the Assignee as assignee, as originally executed or as thereafter amended under any duly authorized and executed amendments thereto. "Authority" means National City Joint Powers Financing Authority, a joint powers agency duly organized and existing under the Joint Powers Agreement, dated as of April 16, 1991 by and between the City and the Community Development Commission of the City of National City, and the laws of the State of California. "Bond Counsel" means any attorney or firm of attorneys of nationally recognized expertise with respect to legal matters relating to obligations the interest on which is excludable from gross income under Section 103 of the Tax Code. "Business Day" means a day other than a Saturday, Sunday or legal holiday, on which banking institutions are not closed in the State of California. "City" means the City of National City, a general law city and municipal corporation organized and existing under the Constitution and laws of the State of California. "Closing Date" means the date of execution and delivery of this Lease by the parties hereto, being September 28, 2010. "Event of Default" means any of the events of default as defined in Section 8.1. "Facilities" means all buildings and other improvements at any time situated on the Site. 5230 13137150 -3- "Federal Securities" means any direct general non -callable obligations of the United States of America (including obligations issued or held in book entry form on the books of the Department of the Treasury of the United States of America), or obligations the timely payment of principal of and interest on which are directly guaranteed by the United States of America. "Fiscal Year" means each twelve-month period during the Term of this Lease commencing on July 1 in any calendar year and ending on June 30 in the next succeeding calendar year, or any other twelve-month period selected by the City as its fiscal year period. "Hazardous Substance" any substance that shall, at any time, be listed as "hazardous" or "toxic" in any Applicable Environmental Law or that has been or shall be determined at any time by any agency or court to be a hazardous or toxic substance regulated under Applicable Environmental Laws; and also means, without limitation, raw materials, building components, the products of any manufacturing, or other activities on the facilities, wastes, petroleum, and source, special nuclear, or by-product material as defined by the Atomic Energy Act of 1954, as amended (42 USC Sections 3011 et seq.). "Lease" means this Lease Agreement dated as of September 1, 2010, between the Authority and the City, as originally executed or as thereafter amended under any duly authorized and executed amendments hereto. "Lease Payment" means all payments required to be paid by the City under Section 4.5, including any prepayment thereof under Sections 9.2 or 9.3. "Lease Payment Date" means April 1 and October 1 in each year, commencing April 1, 2011, and continuing to and including the date on which the Lease Payments are paid in full. "Leased Property" means, collectively, the Site and the Facilities. "Net Proceeds" means amounts derived from any policy of casualty insurance or title insurance with respect to the Leased Property, or the proceeds of any taking of the Leased Property or any portion thereof in eminent domain proceedings (including sale under threat of such proceedings), to the extent remaining after payment therefrom of all expenses incurred in the collection and administration thereof. "1998 Bonds" means the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), issued and delivered in the aggregate principal amount of $6,255,000, of which $3,280,000 is currently outstanding, under the Trust Indenture, dated as of October 1, 1998, among the City, the Authority and the 1998 Trustee. "1998 Lease Agreement" means the Amended and Restated Lease Agreement dated as of October 1, 1998, between the Authority as lessor and the City as lessee. 5231 13137150 -4- • • 5232 "1998 Lease Payments" means the lease payments which are payable by the City under Section 4.4 of the 1998 Lease Agreement, including prepayments thereof under Section 4.8 of the 1998 Lease Agreement. "1998 Trustee" means Union Bank, N.A., as trustee for the 1998 Bonds. "Permitted Encumbrances" means, as of any time: (a) liens for general ad valorem taxes and assessments, if any, not then delinquent, or which the City may permit to remain unpaid under Article VI of this Lease; (b) this Lease and the Assignment Agreement; (c) any right or claim of any mechanic, laborer, materialman, supplier or vendor not filed or perfected in the manner prescribed by law; (d) the exceptions disclosed in the title insurance policy issued by Stewart Title Company with respect to the Leased Property issued as of the Closing Date; and (e) any easements, rights of way, mineral rights, drilling rights and other rights, reservations, covenants, conditions or restrictions which exist of record and which the City certifies in writing will not materially impair the use of the Leased Property for its intended purposes. "Refunding Instructions" means the Irrevocable Refunding Instructions dated as of the Closing Date, given by the City to the 1998 Trustee, relating to the payment and prepayment of the 1998 Bonds and 1998 Lease Payments. "Rental Period" means each period during the Term of the Lease commencing on and including October 2 in each year and extending to and including the next succeeding October 1. The first Rental Period begins on the Closing Date and ends on October 1, 2011. "Site" means the real property which is more particularly described in Appendix A. From and after the date of any substitution of property under Section 4.7 or release of property under Section 4.8, the term "Site" means the real property which remains subject to this Lease following such substitution or release. "Tax Code" means the Internal Revenue Code of 1986 as in effect on the Closing Date or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the Closing Date, together with applicable proposed, temporary and final regulations promulgated, and applicable official public guidance published, under the Tax Code. "Term of this Lease" or "Term" means the time during which this Lease is in effect, as provided in Section 4.3. SECTION 1.2. Interpretation. (a) Unless the context otherwise indicates, words expressed in the singular include the plural and vice versa and the use of the neuter, masculine, or feminine gender 13137150 -5- is for convenience only and include the neuter, masculine or feminine gender, as appropriate. (b) Headings of articles and sections herein and the table of contents hereof are solely for convenience of reference, do not constitute a part hereof and do not affect the meaning, construction or effect hereof. (c) All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Lease; the words "herein," "hereof," "hereby," "hereunder" and other words of similar import refer to this Lease as a whole and not to any particular Article, Section or subdivision hereof. ARTICLE II COVENANTS, REPRESENTATIONS AND WARRANTIES SECTION 2.1. Covenants, Representations and Warranties of the City. The City makes the following covenants, representations and warranties to the Authority as of the date of the execution and delivery of this Lease: (a) Due Organization and Existence. The City is a general law city and municipal corporation duly organized and validly existing under the Constitution and laws of the State of California, has full legal right, power and authority under the laws of the State of California to enter into this Lease and to carry out and consummate all transactions contemplated hereby, and by proper action the City has duly authorized the execution and delivery of this Lease. (b) Due Execution. The representatives of the City executing this Lease have been fully authorized to execute the same under a resolution duly adopted by the City Council of the City. (c) Valid, Binding and Enforceable Obligations. This Lease has been duly authorized, executed and delivered by the City and constitutes the legal, valid and binding agreement of the City enforceable against the City in accordance with its terms. (d) No Conflicts. The execution and delivery of this Lease, the consummation of the transactions herein contemplated and the fulfillment of or compliance with the terms and conditions hereof, do not and will not conflict with or constitute a violation or breach of or default (with due notice or the passage of time or both) under any applicable law or administrative rule or regulation, or any applicable court or administrative decree or order, or any indenture, mortgage, deed of trust, lease, contract or other agreement or 5233 13137150 -6- (e) (f) (g) instrument to which the City is a party or by which it or its properties are otherwise subject or bound, or result in the creation or imposition of any prohibited lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the City, which conflict, violation, breach, default, lien, charge or encumbrance would have consequences that would materially and adversely affect the consummation of the transactions contemplated by this Lease or the financial condition, assets, properties or operations of the City. Consents and Approvals. No consent or approval of any trustee or holder of any indebtedness of the City or of the voters of the City, and no consent, permission, authorization, order or license of, or filing or registration with, any governmental authority is necessary in connection with the execution and delivery of this Lease, or the consummation of any transaction herein contemplated, except as have been obtained or made and as are in full force and effect. No Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court or federal, state, municipal or other governmental authority pending or, to the knowledge of the City after reasonable investigation, threatened against or affecting the City or the assets, properties or operations of the City which, if determined adversely to the City or its interests, would have a material and adverse effect upon the consummation of the transactions contemplated by or the validity of this Lease or upon the financial condition, assets, properties or operations of the City, and the City is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal, state, municipal or other governmental authority, which default might have consequences that would materially and adversely affect the consummation of the transactions contemplated by this Lease, or the financial condition, assets, properties or operations of the City. Essential Purpose. The Leased Property and the financing pursuant to this Lease and the Assignment Agreement are essential to the City's efficient and economic operation, and are in the best interests of the City. (h) Budget. The obligations of the City under this Lease, including without limitation the obligation to make Lease Payments, are obligations payable from the City's general fund budget. (i) Available Funds. The City has funds available for the payment of Lease Payments due during the current Fiscal Year and reasonably believes that sufficient funds can be obtained to make all Lease 5234 13137150 -7- • Payments and payments of other amounts required to be paid hereunder. SECTION 2.2. Covenants, Representations and Warranties of the Authority. The Authority makes the following covenants, representations and warranties to the City as of the date of the execution and delivery of this Lease: (a) Due Organization and Existence. The Authority is a joint powers agency duly organized and existing under the laws of the State of California, has full legal right, power and authority to enter into this Lease and the Assignment Agreement and to carry out and consummate all transactions contemplated hereby and thereby, and by proper action the Authority has duly authorized the execution and delivery of this Lease and the Assignment Agreement. (b) Due Execution. The representatives of the Authority executing this Lease and the Assignment Agreement are fully authorized to execute the same under official action taken by the Commission of the Authority. (c) Valid, Binding and Enforceable Obligations. This Lease and the Assignment Agreement have been duly authorized, executed and delivered by the Authority and constitute the legal, valid and binding agreements of the Authority, enforceable against the Authority in accordance with their respective terms. (d) No Conflicts. The execution and delivery of this Lease and the Assignment Agreement, the consummation of the transactions herein and therein contemplated and the fulfillment of or compliance with the terms and conditions hereof and thereof, do not and will not conflict with or constitute a violation or breach of or default (with due notice or the passage of time or both) under any applicable law or administrative rule or regulation, or any applicable court or administrative decree or order, or any indenture, mortgage, deed of trust, lease, contract or other agreement or instrument to which the Authority is a party or by which it or its properties are otherwise subject or bound, or result in the creation or imposition of any prohibited lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the Authority, which conflict, violation, breach, default, lien, charge or encumbrance would have consequences that would materially and adversely affect the consummation of the transactions contemplated by this Lease and the Assignment Agreement or the financial condition, assets, properties or operations of the Authority. 5235 13137150 -8- (e) Consents and Approvals. No consent or approval of any trustee or holder of any indebtedness of the Authority, and no consent, permission, authorization, order or license of, or filing or registration with, any governmental authority is necessary in connection with the execution and delivery of this Lease or the Assignment Agreement, or the consummation of any transaction herein or therein contemplated, except as have been obtained or made and as are in full force and effect. (f) No Litigation. There is no action, suit, proceeding, inquiry or investigation before or by any court or federal, state, municipal or other governmental authority pending or, to the knowledge of the Authority after reasonable investigation, threatened against or affecting the Authority or the assets, properties or operations of the Authority which, if determined adversely to the Authority or its interests, would have a material and adverse effect upon the consummation of the transactions contemplated by or the validity of this Lease or the Assignment Agreement, or upon the financial condition, assets, properties or operations of the Authority, and the Authority is not in default with respect to any order or decree of any court or any order, regulation or demand of any federal, state, municipal or other governmental authority, which default might have consequences that would materially and adversely affect the consummation of the transactions contemplated by this Lease or the Assignment Agreement or the financial condition, assets, properties or operations of the Authority. ARTICLE III DEPOSIT AND APPLICATION OF FUNDS SECTION 3.1. Deposit of and Application of Funds. On the Closing Date, the Authority shall cause the amount of $3,357,079.91 to be deposited with the 1998 Trustee to be held and administered under the Refunding Instructions for the purpose of paying and prepaying the 1998 Bonds and the 1998 Lease Payments. Such amount shall be derived from (a) an amount of $3,072,079.91 provided by Bank of America, N.A. under that certain Assignment Agreement and (b) an amount of $285,000 paid by the City. In addition, an amount of $42,920.09 will be paid by the Assignee under the Assignment Agreement to Union Bank, N.A., as custodian, for the purpose of paying financing costs of the transaction. SECTION 3.2. Refunding of 1998 Obligations. The City shall cause the amount deposited with the 1998 Trustee under Section 3.1, together with other amounts held by the 1998 Trustee with respect to the 1998 Bonds, to be applied to pay and prepay the 1998 Bonds and the 1998 Lease Payments in accordance with the Refunding Instructions. 5236 13137150 -9- As a result of such payment and prepayment of the 1998 Bonds and the 1998 Lease Payments, the City covenants that the 1998 Bonds and the 1998 Lease Agreement have been discharged on the Closing Date. SECTION 3.3. Termination of 1998 Lease Agreement. As a result of the payment and prepayment of the 1998 Bonds and the 1998 Lease Payments, the 1998 Lease Agreement has been discharged and terminated in accordance with its terms. On the Closing Date, the City and the Authority shall enter into an agreement which terminates the 1998 Lease Agreement, and shall cause an executed copy of said agreement to be recorded in the Office of the San Diego County Recorder. ARTICLE IV LEASE OF LEASED PROPERTY; LEASE PAYMENTS SECTION 4.1. Lease of Leased Property by Authority to City . The Authority hereby covenants that it has fee simple merchantable title to the Leased Property, free and clear of all recorded liens, encumbrances, easements, public rights -of -way, assessments, leases, taxes and any or all other interests, excepting only Permitted Encumbrances. For and in consideration of the application by the Authority of funds in accordance with Section 3.1, the Authority leases the Leased Property to the City and the City hereby leases from the Authority, pursuant to this Lease upon the terms and provisions hereof. SECTION 4.2. [Reserved]. SECTION 4.3. Term. The Term of this Lease commences on the Closing Date and ends on the date on which all of the Lease Payments have been paid in full. SECTION 4.4. Lease Payments. (a) Obligation to Pay. Subject to the provisions of Section 6.3 and the provisions of Article IX, the City agrees to pay to the Authority, its successors and assigns, the Lease Payments (denominated into components of principal and interest) in the respective amounts specified in Appendix B attached hereto (including any supplements thereto) and by this reference incorporated herein, to be due and payable in immediately available funds on each of the respective Lease Payment Dates specified in Appendix B. The Lease Payments payable in any Rental Period with respect to the Leased Property shall be for the use of the Leased Property during such Rental Period. The interest components of the Lease Payments have been calculated based on an interest rate of 3.00% per annum, on the basis of a 360-day year of twelve 30-day months. (b) Effect of Prepayment. If the City prepays all Lease Payments in full under Sections 9.2 or 9.3, the City's obligations under this Section will thereupon cease and terminate. If the City prepays the Lease Payments in part but not in whole under Section 5237 13137150 -10- 9.3, the principal components of the remaining Lease Payments will be reduced in inverse order of maturity; and the interest component of each remaining Lease Payment will be reduced on a pro rata basis. (c) Rate on Overdue Payments. If the City fails to make any of the payments required in this Section 4.4, the payment in default will continue as an obligation of the City until the amount in default has been fully paid, and the City agrees to pay the same with interest thereon, from the date of default to the date of payment at the rate of 8% per annum. (d) Fair Rental Value. The Lease Payments coming due and payable during each Rental Period constitute the total rental for the Leased Property for such Rental Period, and will be paid by the City in each Rental Period for and in consideration of the right of the use and occupancy of, and the continued quiet use and enjoyment of the Leased Property during each Rental Period. The parties hereto have agreed and determined that the total Lease Payments represent the fair rental value of the Leased Property. In making this determination, consideration has been given to the estimated fair market value of the Leased Property, the costs of financing the deposit required to be made under Section 3.1, other obligations of the City and the Authority under this Lease, the uses and purposes which may be served by the Leased Property and the benefits therefrom which will accrue to the City and the general public. (e) Source of Payments; Budget and Appropriation. The Lease Payments are payable from any source of legally available funds of the City, subject to the provisions of Sections 6.3 and 9.1. The City covenants to take such action as may be necessary to include all Lease Payments in each of its annual budgets during the Term of this Lease and to make the necessary annual appropriations for all such Lease Payments. The covenants on the part of the City herein contained constitute duties imposed by law and it is the duty of each and every public official of the City to take such action and do such things as are required by law in the performance of the official duty of such officials to enable the City to carry out and perform the covenants and agreements in this Lease agreed to be carried out and performed by the City. (f) Assignment. The City understands and agrees that all Lease Payments have been assigned by the Authority to the Assignee under the Assignment Agreement, and the City hereby assents to such assignment. The Authority hereby directs the City, and the City hereby agrees, to pay to the Assignee all payments payable by the City under this Section 4.4 and all amounts payable by the City under Article IX. SECTION 4.5. Quiet Enjoyment. Throughout the Term of this Lease, the Authority will provide the City with quiet use and enjoyment of the Leased Property and the City will peaceably and quietly have and hold and enjoy the Leased Property, without suit, trouble or hindrance from the Authority, except as expressly set forth in this Lease. The Authority will, at the request of the City and at the City's cost, join in any legal action in which the City asserts its right to such possession and enjoyment to the extent 523S 13137150 -11- • • the Authority may lawfully do so. Notwithstanding the foregoing, the Authority has the right to inspect the Leased Property as provided in Section 7.2. SECTION 4.6. Title. At all times during the Term of this Lease, the Authority shall hold title to the Leased Property, including all additions which comprise fixtures, repairs, replacements or modifications thereto, subject to Permitted Encumbrances and subject to the provisions of Section 7.2. Upon the termination of this Lease (other than under Section 8.2(b) hereof), all right, title and interest of the Authority in and to the Leased Property shall be transferred to and vested in the City. Upon the payment in full of all Lease Payments allocable to the Leased Property, or upon the deposit by the City of security for such Lease Payments as provided in Section 9.1, all right, title and interest of the Authority in and to the Leased Property shall be transferred to and vested in the City. The Authority agrees to take any and all steps and execute and record any and all documents reasonably required by the City to consummate any such transfer of title. SECTION 4.7. Substitution of Property. With the prior written consent of the Assignee, the City may substitute other land, facilities, improvements, equipment or other property (the "Substitute Property") for the Leased Property or any portion thereof (the "Former Property"), provided that the City has satisfied all of the following requirements which are hereby declared to be conditions precedent to such substitution: (a) No Event of Default has occurred and is continuing. (b) The City has filed with the Authority and the Assignee, and caused to be recorded in the Office of the San Diego County Recorder sufficient memorialization of, an amended Appendix A to this Lease which adds thereto a description of such Substitute Property and deletes therefrom the description of such Former Property. (c) The City has obtained a CLTA policy of title insurance insuring the City's leasehold estate hereunder in the Substitute Property, in an amount at least equal to the aggregate unpaid principal components of the Lease Payments and naming the Assignee as an additional insured. (d) The City has certified in writing to the Authority and the Assignee that such Substitute Property serves the municipal purposes of the City and constitutes property which the City is permitted to lease under the laws of the State of California. (e) The Substitute Property does not cause the City to violate any of its covenants, representations and warranties made herein. 5239 13137150 -12- (f) (g) The City has certified in writing to the Authority and the Assignee that the estimated value and the estimated fair rental value of the Substitute Property are at least equal to the estimated value and the estimated fair rental value, respectively, of the Former Property, and that the useful life of the Substitute Property extends to October 1, 2017. The City has delivered to the Authority and the Assignee an Opinion of Bond Counsel to the effect that such substitution of Leased Property will not, in an of itself, cause the interest portion of Lease Payments to be included in income for federal income tax purposes. If at any time the Facilities are damaged or destroyed by earthquake or other uninsured casualty for which rental interruption insurance is not available, or if the use by the City of the Leased Property is unavailable due to Applicable Environmental Laws or the presence of a Hazardous Substance and rental interruption insurance is not available, the City shall substitute property for the Facilities under this Section 4.7; provided, however, that nothing in this paragraph shall supercede the provisions of Article VI. Upon the satisfaction of all conditions precedent to any substitution under this Section 4.7, the Term of this Lease will thereupon end as to the Former Property and commence as to the Substitute Property. The Authority and the City shall execute, deliver and cause to be recorded all documents required to discharge this Lease and the Assignment Agreement of record against the Former Property. SECTION 4.8. Release of Property. With the prior written consent of the Assignee, the City may release any portion of the Leased Property from this Lease (the "Released Property") provided that the City has satisfied all of the following requirements which are hereby declared to be conditions precedent to such release: (a) No Event of Default has occurred and is continuing. (b) The City has filed with the Authority and the Assignee, and caused to be recorded in the Office of the San Diego County Recorder sufficient memorialization of, an amendment hereof which removes the Released Property from this Lease. (c) The City has certified in writing to the Authority and the Assignee that the value of the property which remains subject to this Lease following such release is at least equal to the aggregate unpaid principal components of the Lease Payments, and the fair rental value of the property which remains subject to this Lease following such release is at least equal to the Lease Payments thereafter coming due and payable hereunder. 5240 13137150 -13- (d) The City has delivered to the Authority and the Assignee an Opinion of Bond Counsel to the effect that such release of Leased Property will not, in an of itself, cause the interest portion of Lease Payments to be included in income for federal income tax purposes. Upon the satisfaction of all such conditions precedent, the Term of this Lease will thereupon end as to the Released Property. The City is not entitled to any reduction, diminution, extension or other modification of the Lease Payments whatsoever as a result of such release. The Authority and the City shall execute, deliver and cause to be recorded all documents required to discharge this Lease and the Assignment Agreement of record against the Released Property. ARTICLE V MAINTENANCE; TAXES; INSURANCE; AND OTHER MATTERS SECTION 5.1. Maintenance, Utilities, Taxes and Assessments. Throughout the Term of this Lease, as part of the consideration for the rental of the Leased Property, all improvement, repair and maintenance of the Leased Property are the sole responsibility of the City, and the City will pay for or otherwise arrange for the payment of all utility services supplied to the Leased Property, which may include, without limitation, janitor service, security, power, gas, telephone, light, heating, water and all other utility services, and shall pay for or otherwise arrange for the payment of the cost of the repair and replacement of the Leased Property resulting from ordinary wear and tear or want of care on the part of the City or any assignee or sublessee thereof. In exchange for the Lease Payments herein provided, the Authority agrees to provide only the Leased Property, as hereinbefore more specifically set forth. The City waives the benefits of subsections 1 and 2 of Section 1932, Section 1933(4) and Sections 1941 and 1942 of the California Civil Code, but such waiver does not limit any of the rights of the City under the terms of this Lease. The City will pay or cause to be paid all taxes and assessments of any type or nature, if any, charged to the Authority or the City affecting the Leased Property or the respective interests or estates therein; provided that with respect to special assessments or other governmental charges that may lawfully be paid in installments over a period of years, the City is obligated to pay only such installments as are required to be paid during the Term of this Lease as and when the same become due. The City may, at the City's expense and in its name, in good faith contest any such taxes, assessments, utility and other charges and, in the event of any such contest, may permit the taxes, assessments or other charges so contested to remain unpaid during the period of such contest and any appeal therefrom unless the Authority shall notify the City that, in its reasonable opinion, by nonpayment of any such items the interest of the Authority in the Leased Property will be materially endangered or the Leased Property or 524. 13137150 -14- any part thereof will be subject to loss or forfeiture, in which event the City will promptly pay such taxes, assessments or charges or provide the Authority with full security against any loss which may result from nonpayment, in form satisfactory to the Authority. SECTION 5.2. Modification of Leased Property. The City has the right, at its own expense, to make additions, modifications and improvements to the Leased Property or any portion thereof. All additions, modifications and improvements to the Leased Property will thereafter comprise part of the Leased Property and become subject to the provisions of this Lease. Such additions, modifications and improvements may not in any way damage the Leased Property, or cause the Leased Property to be used for purposes other than those authorized under the provisions of state and federal law; and the Leased Property, upon completion of any additions, modifications and improvements made thereto under this Section, must be of a value which is not substantially less than the value thereof immediately prior to the making of such additions, modifications and improvements. SECTION 5.3. Public Liability Insurance. The City shall maintain or cause to be maintained throughout the Term of this Lease a standard comprehensive general insurance policy or policies in protection of the City, the Authority and their respective members, officers, agents, employees and assigns. Said policy or policies shall provide for indemnification of said parties against direct or contingent loss or liability for damages for bodily and personal injury, death or property damage occasioned by reason of the operation of the Leased Property. Such policy or policies must provide coverage of at least $1,000,000 and may be subject to such deductibles as the City deems adequate and prudent. Such insurance may be maintained as part of or in conjunction with any other insurance coverage carried by the City, and may be maintained in whole or in part in the form of the participation by the City in a joint powers authority or other program providing pooled insurance. The City will apply the proceeds of such liability insurance toward extinguishment or satisfaction of the liability with respect to which such proceeds have been paid. SECTION 5.4. Casualty Insurance; Flood Coverage. (a) Requirement to Maintain Casualty Insurance. The City will procure and maintain, or cause to be procured and maintained, throughout the Term of this Lease, casualty insurance against loss or damage to the Facilities by fire and lightning, with extended coverage insurance, vandalism and malicious mischief insurance and sprinkler system leakage insurance. Said extended coverage insurance shall, as nearly as practicable, cover loss or damage by explosion, windstorm, riot, aircraft, vehicle damage, smoke and such other hazards as are normally covered by such insurance. Such insurance shall be in an amount at least equal to the lesser of (i) the replacement value of the insured Facilities, or (ii) the aggregate unpaid principal components of the Lease Payments, and may be subject to such deductibles as the City deems adequate and prudent. Such insurance may be maintained as part of or in conjunction with any other insurance coverage carried by the City, and may be maintained in whole or in part in the form of the participation by the City in a joint powers authority or other program 5242 13137150 -15- providing pooled insurance. The City will apply the Net Proceeds of such insurance as provided in Article VI. (b) Flood Insurance. So long as the Leased Property is located in a 100-year flood area as shown on a Flood Insurance Rate Map published by the Federal Emergency Management Agency, the policy or policies of casualty insurance provided under this Section 5.4 shall include insurance against loss or damage to the Facilities due to flooding. If the City obtains an exception or waiver to the designation of the Facilities as being within a 100-year flood area from the Federal Emergency Management Agency, the City shall not be required to provide flood insurance as set forth in this subsection (b). (c) Federal or State Disaster Aid. Should the Facilities be damaged or destroyed as a result of an event for which federal or State of California disaster aid is available, the Authority and/or the City shall promptly apply for disaster aid. Any disaster aid proceeds received shall be used to repair, reconstruct, restore or replace the damaged or destroyed portions of the Facilities, or, at the option of the City and the Authority, to prepay the Lease Payments if permitted under the disaster aid program. (d) Self -Insurance. As an alternative to providing the insurance required by this Section, the City may provide a self-insurance method or plan of protection if and to the extent such self-insurance method or plan of protection affords reasonable coverage for the risks required to be insured against, in light of all circumstances, giving consideration to cost, availability and similar plans or methods of protection adopted by public entities in the State of California other than the City. Before such other method or plan may be provided by the City, and annually thereafter so long as such method or plan is being provided to satisfy the requirements of this Lease, there shall be filed with the Authority a certificate of an actuary, insurance consultant or other qualified person (who may be an employee of the City), stating that, in the opinion of the signer, the substitute method or plan of protection is in accordance with the requirements of this Section and, when effective, would afford reasonable coverage for the risks required to be insured against. There shall also be filed a certificate of the City setting forth the details of such substitute method or plan. In the event of loss covered by any such self-insurance method, the liability of the City hereunder shall be limited to the amounts in the self-insurance reserve fund or funds created under such method. SECTION 5.5. Rental Interruption Insurance. The City will procure and maintain, or cause to be procured and maintained, throughout the Term of this Lease, rental interruption or use and occupancy insurance to cover loss, total or partial, of the use of the Leased Property and the improvements situated thereon as a result of any of the hazards covered in the insurance required by Section 5.4, in an amount at least equal to the maximum Lease Payments coming due and payable during any future 24-month period. Such insurance may be maintained as part of or in conjunction with any other insurance coverage carried by the City, and may be maintained in whole or in part in the form of the participation by the City in a joint powers authority or other program providing pooled insurance. Such rental interruption or use and occupancy insurance shall not be self insured and the City acknowledges that this requirement may limit their 5243 13137150 -16- ability to self -insure under Section 5.4. The City will apply the Net Proceeds of such insurance towards the payment of the Lease Payments allocable to the insured improvements as the same become due and payable. SECTION 5.6. Worker's Compensation Insurance. If required by applicable California law, the City shall carry worker's compensation insurance covering all employees on, in, near or about the Leased Property and, upon request, shall furnish to the Authority certificates evidencing such coverage throughout the Term of this Lease. SECTION 5.7. Recordation Hereof, Title Insurance. On or before the Closing Date, the City shall, at its expense, (a) cause the Assignment Agreement and this Lease, or a memorandum hereof or thereof in form and substance approved by Bond Counsel, to be recorded in the office of the San Diego County Recorder with respect to the Leased Property, and (b) obtain a CLTA title insurance policy insuring the Assignee's interests in the estate established hereunder in the Leased Property, subject only to Permitted Encumbrances, in an amount equal to the original principal components of the Lease Payments. The City will apply the Net Proceeds received under such title insurance policy to prepay the remaining Lease Payments under Section 9.3. SECTION 5.8. Form of Policies. All insurance policies (or riders) required by this Article V shall be taken out and maintained with responsible insurance companies organized under the laws of one of the states of the United States and qualified to do business in the State of California, and shall contain a provision that the insurer shall not cancel or revise coverage thereunder without giving written notice to the insured parties at least ten days before the cancellation or revision becomes effective. Each insurance policy or rider required by Sections 5.3, 5.4 and 5.5 shall name the City and the Assignee as insured parties and the Assignee as loss payee and shall include a lender's loss payable endorsement for the benefit of the Assignee. Prior to the Closing Date, the City will deposit with the Assignee policies (and riders and endorsements, if applicable) evidencing any such insurance procured by it, or a certificate or certificates of the respective insurers stating that such insurance is in full force and effect. Before the expiration of any such policy (or rider), the City will furnish to the Assignee evidence that the policy has been renewed or replaced by another policy conforming to the provisions of this Article V unless such insurance is no longer obtainable, in which event the City shall notify the Assignee of such fact. SECTION 5.9.. Installation of City's Personal Property. The City may at any time and from time to time, in its sole discretion and at its own expense, install or permit to be installed other items of equipment or other personal property in or upon the Leased Property. All such items shall remain the sole property of the City, in which the Authority has no interest, and may be modified or removed by the City at any time. The City must repair and restore any and all damage to the Leased Property resulting from the installation, modification or removal of any such items. Nothing in this Lease prevents the City from purchasing or leasing items to be installed under this Section under a lease or conditional sale agreement, or subject to a vendor's lien or security agreement, as 5241. I3137150 -17- security for the unpaid portion of the purchase price thereof, provided that no such lien or security interest may attach to any part of the Leased Property. SECTION 5.10. Liens. The City will not, directly or indirectly, create, incur, assume or suffer to exist any mortgage, pledge, lien, charge, encumbrance or claim on or with respect to the Leased Property, other than as herein contemplated and except for such encumbrances as the City certifies in writing to the Authority do not materially and adversely affect the leasehold estate in the Leased Property hereunder and for which the Assignee approves in writing, which approval may not be unreasonably withheld. Except as expressly provided in this Article V, the City will promptly, at its own expense, take such action as may be necessary to duly discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim, for which it is responsible, if the same shall arise at any time. The City will reimburse the Authority for any expense incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge, encumbrance or claim. SECTION 5.11. Advances. If the City fails to perform any of its obligations under this Article V, the Authority may take such action as may be necessary to cure such failure, including the advancement of money, and the City shall be obligated to repay all such advances as additional rental hereunder, with interest at the rate set forth in Section 4.4(c). ARTICLE VI DAMAGE, DESTRUCTION AND EMINENT DOMAIN; USE OF PROCEEDS; ABATEMENT OF LEASE PAYMENTS SECTION 6.1. Deposit of Net Proceeds. The Net Proceeds of any taking of the Leased Property or any portion thereof in eminent domain proceedings, and the Net Proceeds of any policy of insurance maintained under Section 5.4, shall be paid to the City or the Authority to be applied as hereinafter set forth in Section 6.2. SECTION 6.2. Application of Net Proceeds. If the Leased Property is taken in eminent domain proceedings at any time during the Term of this Lease, or if the Leased Property is damaged due to an insured casualty which is covered by a policy of insurance maintained under Section 5.4, the City shall as soon as practicable after such event, with the prior written consent of the Assignee, apply the Net Proceeds resulting therefrom either to: (a) repair the Leased Property to full use; (b) replace the Leased Property, at the City's sole cost and expense, with property of equal or greater value to the Leased Property immediately prior to the time of the such destruction or damage, 5245 13137150 -18- such replacement Leased Property to be subject to the Assignee's reasonable approval, whereupon such replacement shall be substituted in this Lease by appropriate endorsement; (c) substitute additional property as provided in Section 4.7; or (d) prepay the Lease Payments in accordance with Section 9.3. The City will notify the Authority and the Assignee of which course of action it has elected to take within 30 days after the occurrence of such eminent domain proceedings or such destruction or damage. The Authority may (but is not required to) in its own name or in the City's name execute and deliver proofs of claim, receive all such moneys, endorse checks and other instruments representing payment of such moneys, and adjust, litigate, compromise or release any claim against the issuer of any such policy, and the City hereby grants to the Authority a power of attorney coupled with an interest to accomplish all or any of the foregoing. SECTION 6.3. Abatement Due to Damage or Destruction. The Lease Payments are subject to abatement during 'any period in which by reason of damage or destruction (other than by eminent domain which is hereinbefore provided for) there is substantial interference with the use and occupancy by the City of the Leased Property or any portion thereof. The Lease Payments are subject to abatement in an amount determined by the City such that the resulting Lease Payments represent fair consideration for the use and occupancy of the remaining usable portions of the Leased Property not damaged or destroyed. Such abatement will continue for the period commencing with such damage or destruction and ending with the substantial completion of the work of repair or reconstruction. In the event of any such damage or destruction, this Lease will continue in full force and effect and the City waives any right to terminate this Lease by virtue of any such damage and destruction. Notwithstanding the foregoing, the Lease Payments are not subject to abatement to the extent that rental interruption insurance proceeds are available to pay Lease Payments which would otherwise be abated under this Section 6.3, it being hereby declared that such amounts constitute special funds for the payment of the Lease Payments. ARTICLE VII OTHER COVENANTS OF THE CITY SECTION 7.1. Disclaimer of Warranties. THE AUTHORITY MAKES NO AGREEMENT, WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR FITNESS FOR THE USE CONTEMPLATED BY THE CITY OF THE LEASED PROPERTY OR ANY PORTION THEREOF, OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE LEASED PROPERTY OR ANY PORTION THEREOF. 5246 13137150 -19- THE CITY ACKNOWLEDGES THAT THE AUTHORITY IS NOT A MANUFACTURER OF ANY PORTION OF THE LEASED PROPERTY OR A DEALER THEREIN, THAT THE CITY LEASES THE LEASED PROPERTY AS -IS, IT BEING AGREED THAT ALL OF THE AFOREMENTIONED RISKS ARE TO BE BORNE BY THE CITY. In no event is the Authority liable for incidental, indirect, special or consequential damages, in connection with or arising out of this Lease for the existence, furnishing, functioning or use of the Leased Property by the City. SECTION 7.2. Access to the Leased Property. The City agrees that the Authority, and the Authority's successors or assigns, has the right at all reasonable times, following at least 48 hours written notice provided to the City, to enter upon and to examine and inspect the Leased Property or any part thereof. The City further agrees that the Authority, and the Authority's successors or assigns, shall have such rights of access to the Leased Property or any component thereof, following at least 48 hours written notice provided to the City, as may be reasonably necessary to cause the proper maintenance of the Leased Property if the City fails to perform its obligations hereunder. Neither the Authority nor any of its assigns has any obligation to cause such proper maintenance. SECTION 7.3. Release and Indemnification Covenants. The City hereby indemnifies the Authority, the Assignee and their respective officers, agents, successors and assigns against all claims, losses and damages, including legal fees and expenses, arising out of (a) the use, maintenance, condition or management of, or from any work or thing done on the Leased Property by the City, (b) any breach or default on the part of the City in the performance of any of its obligations under this Lease, (c) any negligence or willful misconduct of the City or of any of its agents, contractors, servants, employees or licensees with respect to the Leased Property, (d) any intentional misconduct or negligence of any sublessee of the City with respect to the Leased Property, (e) the acquisition, construction, improvement and equipping of the Leased Property, (f) the use , presence, storage, disposal or clean-up of any Hazardous Substances or toxic wastes on the Leased Property, (g) the failure to comply with any Applicable Environmental Laws, or (h) any loss of the federal income tax exemption of the interest portion of Lease Payments and any interest or penalties imposed by the Internal Revenue Service on the Assignee in connection therewith, any such amount to be paid to the Assignee in a single lump sum payment upon demand of the Assignee, or the authorization of payment of the costs thereof. No indemnification is made under this Section or elsewhere in this Lease for willful misconduct or gross negligence under this Lease by the Authority, the Assignee, or their respective officers, agents, employees, successors or assigns. SECTION 7.4. Assignment by the Authority. The Authority's rights under this Lease, including the right to receive and enforce payment of the Lease Payments to be made by the City hereunder, have been assigned to the Assignee under the Assignment Agreement. The City hereby consents to such assignment. Whenever in this Lease any reference is made to the Authority and such reference concerns rights which the Authority has assigned to the Assignee, such reference shall be deemed to refer to the Assignee. 5247 I3137150 -20- The Authority and the Assignee may make additional assignments of their interests herein, but no such assignment will be effective as against the City unless and until the Authority or the Assignee has filed with the City written notice thereof The City shall pay all Lease Payments hereunder under the written direction of the Authority or the assignee named in the most recent assignment or notice of assignment filed with the City. During the Term of this Lease, the City will keep a complete and accurate record of all such notices of assignment. SECTION 7.5. Assignment and Subleasing by the City. This Lease may not be assigned by the City. With the prior written consent of the Assignee, the City may sublease the Leased Property, or any portion thereof, subject to all of the following conditions: (a) This Lease and the obligation of the City to make Lease Payments hereunder shall remain obligations of the City. (b) The City shall, within 30 days after the delivery thereof, furnish or cause to be furnished to the Authority and the Assignee a true and complete copy of such sublease. (c) Any sublease shall be expressly subject and subordinate to this Lease. (d) No such sublease by the City may cause the Leased Property to be used for a purpose other than as may be authorized under the provisions of the laws of the State of California. (e) The City shall furnish the Authority and the Assignee with a written opinion of Bond Counsel stating that such sublease does not cause the interest components of the Lease Payments to become includable in gross income for purposes of federal income taxation or to become subject to personal income taxation by the State of California. SECTION 7.6. Amendment Hereof This Lease may be amended with the prior written consent of the Assignee. Prior to the effective date of any such amendment, and as a condition precedent to the effectiveness thereof, the City at its expense shall obtain an opinion of Bond Counsel stating that such amendment will not adversely affect the exclusion from gross income of the interest component of the Lease Payments. SECTION 7.7. Tax Covenants. (a) Generally. The City will not take any action or permit to be taken any action within its control which would cause or which, with the passage of time if not 5243 13137150 -21- cured would cause, the interest components of the Lease Payments to become includable in gross income for federal income tax purposes. (b) Private Activity Bond Limitation. The City will ensure that the proceeds of the Lease Payments are not so used as to cause the City's obligations hereunder to satisfy the private business tests of Section 141(b) of the Tax Code or the private loan financing test of Section 141(c) of the Tax Code. (c) Federal Guarantee Prohibition. The City will not take any action or permit or suffer any action to be taken if the result of the same would be to cause the Lease Payments to be "federally guaranteed" within the meaning of Section 149(b) of the Tax Code. (d) No Arbitrage. The City will not take, or permit or suffer to be taken, any action with respect to the proceeds of the Lease Payments which, if such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the Closing Date would have caused the Lease Payments to be "arbitrage bonds" within the meaning of Section 148(a) of the Tax Code. (e) Small Issuer Exemption from Bank Nondeductibility Restriction. The City hereby designates the Lease Payments for purposes of paragraph (3) of Section 265(b) of the Tax Code and hereby covenants that (i) the Lease Payments do not constitute private activity bonds as defined in Section 141 of the Tax Code, and (ii) not more than $30,000,000 aggregate principal amount of obligations the interest on which is excludable (under Section 103(a) of the Tax Code) from gross income for federal income taxes (excluding, however, private activity bonds, as defined in Section 141 of the Tax Code, other than qualified 501(c)(3) bonds as defined in Section 145 of the Tax Code), including the Lease Payments, have been or shall be issued by or on behalf of the City, including all subordinate entities of the City, during the calendar year 2010. (f) Arbitrage Rebate. The City will take any and all actions necessary to assure compliance with Section 148(f) of the Tax Code, relating to the rebate of excess investment earnings, if any, to the federal government, to the extent that such section is applicable to the Lease Payments. SECTION 7.8 Environmental Covenants. (a) Compliance with Laws; No Hazardous Substances. The City will comply with all Applicable Environmental Laws with respect to the Leased Property and will not use, store, generate, treat, transport, or dispose of any Hazardous Substance thereon or in a manner that would cause any Hazardous Substance to later flow, migrate, leak, leach, or otherwise come to rest on or in the Leased Property. (b) Notification of Assignee. The City will transmit copies of all notices, orders, or statements received from any governmental entity concerning violations or asserted violations of Applicable Environmental Laws with respect to the Leased 5249 13137150 -22- • Property and any operations conducted thereon or any conditions existing thereon to the Assignee, and the City will notify the Assignee in writing immediately of any release, discharge, spill, or deposit of any Hazardous Substances that has occurred or is occurring that in any way affects or threatens to affect the Leased Property, or the people, structures, or other property thereon, provided that no such notifications shall create any liability or obligation on the part of the Assignee. (c) Access for Inspection. The City shall permit the Assignee, its agents, or any experts designated by the Assignee to have full access to the Leased Property during reasonable business hours for purposes of such independent investigation of compliance with all Applicable Environmental Laws, provided that the Assignee has no obligation to do so, or any liability for any failure to do so, or any liability should it do so. SECTION 7.9 Financial Statements; Budgets. Within 270 days following the end of each Fiscal Year of the City during the Tenn of this Lease, the City shall provide the Assignee with a copy of its audited financial statements for such Fiscal Year. Such audited financial statements shall include a balance sheet, a statement of revenues, expenses and changes in fund balances for budget and actual, a statement of cash flows, notes, schedules and any attachments to the financial statements and such other financial information as the Assignee shall reasonably request. Within ten days of its becoming publicly available during the term of this Lease, the City will provide the Assignee with a copy of its annual budget and any interim updates or modifications to such budget. ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES SECTION 8.1. Events of Default Defined. Any one or more of the following events constitutes an Event of Default hereunder: (a) Failure by the City to pay any Lease Payment or other payment required to be paid hereunder at the time specified herein. (b) Failure by the City to observe and perform any covenant, condition or agreement on its part to be observed or performed hereunder, other than as referred to in the preceding clause (a) of this Section, for a period of 30 days after written notice specifying such failure and requesting that it be remedied has been given to the City by the Authority or the Assignee. However, if in the reasonable opinion of the City the failure stated in the notice can be corrected, but not within such 30-day period, the Authority and the Assignee shall not unreasonably withhold their consent to an extension of such time (for a period not to exceed 60 days) if corrective action is instituted by the City within such 30-day period and diligently pursued until the default is corrected. 52 u 13137150 -23- (c) The filing by the City of a voluntary petition in bankruptcy, or failure by the City promptly to lift any execution, garnishment or attachment, or adjudication of the City as a bankrupt, or assignment by the City for the benefit of creditors, or the entry by the City into an agreement of composition with creditors, or the approval by a court of competent jurisdiction of a petition applicable to the City in any proceedings instituted under the provisions of the Federal Bankruptcy Code, as amended, or under any similar acts which may hereafter be enacted. SECTION 8.2. Remedies on Default. Whenever any Event of Default has happened and is continuing, the Authority may exercise any and all remedies available under law or granted under this Lease; provided, however, that notwithstanding anything herein to the contrary, there shall be no right under any circumstances to accelerate the Lease Payments or otherwise declare any Lease Payments not then in default to be immediately due and payable. Each and every covenant hereof to be kept and performed by the City is expressly made a condition and upon the breach thereof the Authority may exercise any and all rights granted hereunder; provided, that no termination of this Lease shall be effected either by operation of law or acts of the parties hereto, except only in the manner herein expressly provided. Upon the occurrence and during the continuance of any Event of Default, the Authority may exercise any one or more of the following remedies: (a) Enforcement of Payments Without Termination. If the Authority does not elect to terminate this Lease in the manner hereinafter provided for in subparagraph (b) hereof, the City agrees to and shall remain liable for the payment of all Lease Payments and the performance of all conditions herein contained and shall reimburse the Authority for any deficiency arising out of the re -leasing of the Leased Property, or, if the Authority is unable to re -lease the Leased Property, then for the full amount of all Lease Payments to the end of the Term of this Lease, but said Lease Payments and/or deficiency shall be payable only at the same time and in the same manner as hereinabove provided for the payment of Lease Payments hereunder, notwithstanding such entry or re-entry by the Authority or any suit in unlawful detainer, or otherwise, brought by the Authority for the purpose of effecting such re-entry or obtaining possession of the Leased Property or the exercise of any other remedy by the Authority. The City hereby irrevocably appoints the Authority as the agent and attorney -in -fact of the City to enter upon and re -lease the Leased Property upon the occurrence and continuation of an Event of Default and to remove all personal property whatsoever situated upon the Leased Property, to place such property in storage or other suitable place located as close as possible to the City in the County of San Diego for the account of and at the expense of the City, and the City hereby exempts and 52.51 13137150 -24- agrees to save harmless the Authority from any costs, loss or damage whatsoever arising or occasioned by any such entry upon and re -leasing of the Leased Property and the removal and storage of such property by the Authority or its duly authorized agents in accordance with the provisions herein contained. The City agrees that the terms of this Lease constitute full and sufficient notice of the right of the Authority to re -lease the Leased Property in the event of such re-entry without effecting a surrender of this Lease, and further agrees that no acts of the Authority in effecting such re -leasing shall constitute a surrender or termination of this Lease irrespective of the term for which such re -leasing is made or the terms and conditions of such re -leasing, or otherwise, but that, on the contrary, in the event of such default by the City the right to terminate this Lease shall vest in the Authority to be effected in the sole and exclusive manner hereinafter provided for in subparagraph (b) hereof. The City agrees to surrender and quit possession of the Leased Property upon demand of the Authority for the purpose of enabling the Leased Property to be re -let under this paragraph, and the City further waives the right to any rental obtained by the Authority in excess of the Lease Payments and hereby conveys and releases such excess to the Authority as compensation to the Authority for its services in re -leasing the Leased Property. (b) Termination of Lease. If an Event of Default occurs and is continuing hereunder, the Authority at its option may terminate this Lease and re -lease all or any portion of the Leased Property. If the Authority terminates this Lease at its option and in the manner hereinafter provided due to a default by the City (and notwithstanding any re-entry upon the Leased Property by the Authority in any manner whatsoever or the re -leasing of the Leased Property), the City nevertheless agrees to pay to the Authority all costs, loss or damages howsoever arising or occurring payable at the same time and in the same manner as is herein provided in the case of payment of Lease Payments and Additional Payments. Any surplus received by the Authority from such re -leasing shall be applied by the Authority to Lease Payments due under this Lease. Neither notice to pay rent or to deliver up possession of the premises given under law nor any proceeding in unlawful detainer taken by the Authority shall of itself operate to terminate this Lease, and no termination of this Lease on account of default by the City shall be or become effective by operation of law, or otherwise, unless and until the Authority shall have given written notice to the City of the election on the part of the Authority to terminate this Lease. The City covenants and agrees that no surrender of the Leased Property, or of the remainder of the Term hereof or any termination of this 5252 13137150 -25- Lease shall be valid in any manner or for any purpose whatsoever unless stated or accepted by the Authority by such written notice. (c) Proceedings at Law or In Equity. If an Event of Default occurs and continues hereunder, the Authority may take whatever action at law or in equity may appear necessary or desirable to collect the amounts then due and thereafter to become due hereunder or to enforce any other of its rights hereunder. SECTION 8.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Lease or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon the occurrence of any Event of Default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Authority to exercise any remedy reserved to it in this Article VIII it shall not be necessary to give any notice, other than such notice as may be required in this Article VIM or by law. SECTION 8.4. Agreement to Pay Attorneys' Fees and Expenses. If either party to this Lease defaults under any of the provisions hereof and the nondefaulting party should employ attorneys (including in-house legal counsel) or incur other expenses for the collection of moneys or the enforcement or performance or observance of any obligation or agreement on the part of the defaulting party herein contained, the defaulting party agrees that it will on demand therefor pay to the nondefaulting party the reasonable fees of such attorneys (including allocable costs and expenses of in-house legal counsel, if any) and such other expenses so incurred by the nondefaulting party. SECTION 8.5. No Additional Waiver Implied by One Waiver. If any agreement contained in this Lease is breached by either party and thereafter waived by the other party, such waiver is limited to the particular breach so waived and will not be deemed to waive any other breach hereunder. SECTION 8.6. Assignee to Exercise Rights. Such rights and remedies as are given to the Authority under this Article VIII have been assigned by the Authority to the Assignee, to which assignment the City hereby consents. Such rights and remedies shall be exercised solely by the Assignee. ARTICLE IX PREPAYMENT OF LEASE PAYMENTS SECTION 9.1. Security Deposit. Notwithstanding any other provision of this Lease, the City may on any date secure the payment of the Lease Payments in whole or in 5253 13137150 -26- • part by depositing with a fiduciary, in trust, an amount of cash which is either (a) sufficient to pay such Lease Payments, including the principal and interest components thereof, in accordance with the Lease Payment schedule set forth in Appendix B, or (b) invested in whole in non -callable Federal Securities in an amount which is sufficient, in the opinion of an independent certified public accountant, together with interest to accrue thereon and together with any cash which is so deposited, to pay such Lease Payments when due under Section 4.4(a) or when due on any optional prepayment date under Section 9.2, as the City instructs at the time of said deposit. In the event of a security deposit under this Section with respect to all unpaid Lease Payments, (a) the Term of this Lease shall continue, (b) all obligations of the City under this Lease, and all security provided by this Lease for said obligations, shall thereupon cease and terminate, excepting only the obligation of the City to make, or cause to be made all of the Lease Payments from such security deposit, and (c) under Section 4.6, title to the Leased Property will vest in the City on the date of said deposit automatically and without further action by the City or the Authority. The City hereby grants a first priority security interest in and the lien on said security deposit and all proceeds thereof in favor of the Authority and the Assignee. Said security deposit shall be deemed to be and shall constitute a special fund for the payment of Lease Payments in accordance with the provisions of this Lease. SECTION 9.2. Optional Prepayment. The City may prepay the unpaid principal components of the Lease Payments in whole, on any date on or after April 1, 2014, by paying a prepayment price equal to the principal components of the Lease Payments to be prepaid, together with the interest required to be paid on such Lease Payment Date, without premium or penalty. The City shall give the Authority notice of its intention to exercise its option to prepay the Lease Payments under this Section 9.2 not less than 30 days in advance of the date of exercise. SECTION 9.3. Mandatory Prepayment From Net Proceeds of Insurance or Eminent Domain. The City may prepay the unpaid principal components of the Lease Payments in whole or in part on any date, from and to the extent of any Net Proceeds to be used for such purpose under Section 6.2, by paying a prepayment price equal to the principal components of the Lease Payments to be prepaid, together with the interest required to be paid on such Lease Payment Date, without premium or penalty. The City shall give the Authority notice of its intention to exercise its option to prepay the Lease Payments under this Section 9.3 not less than 60 days in advance of the date of exercise. ARTICLE X MISCELLANEOUS SECTION 10.1. Notices. Any notice, request, complaint, demand or other communication under this Lease shall be given by first class mail or personal delivery to the party entitled thereto at its address set forth below, or by facsimile transmission or other form of telecommunication, at its number set forth below. Notice shall be effective 5254 13137150 -27- • either (a) upon transmission by facsimile transmission or other form of telecommunication, (b) 48 hours after deposit in the United States of America first class mail, postage prepaid, or (c) in the case of personal delivery to any person, upon actual receipt. The Authority, the City and the Assignee may, by written notice to the other parties, from time to time modify the address or number to which communications are to be given hereunder. If to the City: If to the Authority: If to the Assignee: City of National City 1243 National City Boulevard National City, California 91950 Attention: Director of Finance Fax: (619) 336-4349 National City Joint Powers Financing Authority c/o City of National City 1243 National City Boulevard National City, California 91950 Attention: Director of Finance Fax: (619) 336-4349 Bank of America, N.A. 555 California Street, 4th Floor San Francisco, California 94104 Attention: Contract Administration Fax: (415) 343-0531 SECTION 10.2. Binding Effect. This Lease inures to the benefit of and is binding upon the Authority, the City and their respective successors and assigns. SECTION 10.3. Severability. If any provision of this Lease is held invalid or unenforceable by any court of competent jurisdiction, such holding will not invalidate or render unenforceable any other provision hereof. SECTION 10.4. Net -net -net Lease. This Lease is a "net -net -net lease" and the City hereby agrees that the Lease Payments are an absolute net return to the Authority, free and clear of any expenses, charges or set -offs whatsoever. SECTION 10.5. Further Assurances and Corrective Instruments. The Authority and the City agree that they will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such supplements hereto and such further instruments as may reasonably be required for correcting any inadequate or incorrect description of the Leased Property hereby leased or intended so to be or for carrying out the expressed intention of this Lease. 5255 13137150 -28- a SECTION 10.6. Execution in Counterparts. This Lease may be executed in several counterparts, each of which is an original and all of which constitutes one and the same instrument. SECTION 10.7. Applicable Law. This Lease is governed by and construed in accordance with the laws of the State of California. SECTION 10.8. Captions. The captions or headings in this Lease are for convenience only and in no way define, limit or describe the scope or intent of any provisions or Section of this Lease. [Remainder of Page Intentionally Left Blank] 5256 13137150 -29- IN WITNESS WHEREOF, the Authority and the City have caused this Lease to be executed in their respective names by their duly authorized officers, all as of the date first above written. Appro ed as to Form: By C s G. Silva, ► ' eral Counsel Attest: By Chris Zapata, e, etary Appro ed as to Form: By C Attest: City Attorney By Mf;41),A el R. Dally Clerk NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, as Lessor By 4110 Kon Morrison Chairman CITY OF NATIONAL CITY, CALIFOIA, as Lessee By Ron Morrison Mayor 5257 13137150 -30- 5258 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California County of SLn D ieg 9 On 9 /23// C7 ate personally appeared before me, �j. fRjy ,'/Of rlSC/Yl Name(s) of Signer(a) in O CCQ (Here InBert Name an0 Tltle of the Officer n JJ VIRGINIA M. ORCUTT Commission # 1874998 Notary Public - California sJ San Diego County M Comm. Ex Tres Dec 26.2013 who proved to me on the basis of satisfactory evidence to be the personn,$) whose name(* is/we-subscribed to the within instrument and acknowledged to me that he/shetthey-executed the same in hishis/iRefithelpauthorized capacity4 es), and that by his/her/their signatura(sron the instrument the person0), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OPTIONAL Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) Other Than Named Above: Signature of N ry Public Place Notary Seal Above Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Individual ❑ Individual Cl Corporate Officer — Title(s): ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General LI Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Attorney in Fact ❑ Trustee ❑ Trustee • Guardian or Conservator ❑ Guardian or Conservator ❑ Other: ❑ Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Top of thumb here Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Top of thumb here 2C Hw ®2007 National Notary Associatbn • 9350 De Soto Ave., P.O. Box 2402 •Chatsworth, CA 91313-2402• www.NationaINotary org Item N5907 Reorder: Call TbS-Free 1-800-876-6827 . • APPENDIX A DESCRIPTION OF THE LEASED PROPERTY The Leased Property consists of the following described land located in the City of National City, County of San Diego, State of California, together with all buildings, facilities and other improvements which constitute real property and which are located thereon: PARCEL A: PARCEL(S) 1 AND 2 OF PARCEL MAP NO. 4027, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY AUGUST 21, 1975 AS FILE NO. 75- 224074 OF OFFICIAL, RECORDS. PARCEL B: THE WEST 33-1/3 FEET OF LOTS 7 TO 10, INCLUSIVE, IN BLOCK 13 OF THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP NO. 348, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL C: THE WESTERLY 33 1/3 FEET OF THE EASTERLY 66 2/3 FEET OF LOTS 7 TO 10 INCLUSIVE IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL D: THE EASTERLY 33 1/3 FEET OF LOTS 7, 8, 9 AND 10 OF BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL E: THE SOUTHERLY 100 FEET OF LOT 11 AND THE SOUTHERLY 100 FEET OF THE WESTERLY EIGHT AND ONE-THIRD FEET OF LOT 12 EN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL F: 5259 13137150.5 A-1 • LOTS 13 THROUGH 17 IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL G: LOT 6, THE NORTH 25 PEST OF LOTS 11 AND 12 AND THE EAST 16 2/3 FEET OF SOUTH 100 FEET OF LOT 12, ALL IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL H: A. PERMANENT EASEMENT AND RIGHT-OF-WAY TO CONSTRUCT, RECONSTRUCT, MAINTAIN, OPERATE AND REPAIR AN UNDERGROUND EMERGENCY GENERATOR FUEL TANK, DESCRIBED AS FOLLOWS: ALL THAT PORTION OF 12TH STREET, LYING NORTHERLY OF BLOCK 13 OF MAP NUMBER 348, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWESTERLY CORNER OF SAID BLOCK 13, BEING ALSO THE NORTHWESTERLY CORNER OF PARCEL 1 OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF SAID PARCEL 1, 75 FEET TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING EASTERLY ALONG SAID NORTHERLY LINE, SIGHT FEET; THENCE LEAVING SAID NORTHERLY LINE, AT RIGHT ANGLES, NORTH SIX FEET; THENCE WESTERLY, PARALLEL WITH THE NORTHERLY LINE OF SAID PARCEL 1, EIGHT FEET; THENCE AT RIGHT ANGLES, SOUTH, SIX FEET TO THE TRUE POINT OF BEGINNING, CONTAINING 48 SQUARE FEET. 5260 13137150.5 A-2 e !1. • • APPENDIX B SCHEDULE OF LEASE PAYMENTS Lease Principal Interest Aggregate Payment Date Component Component Lease Payment April 1, 2011 $ $ 47,503.75 $ 47,503.75 October 1, 2011 400,000.00 46,725.00 446,725.00 April 1, 2012 40,725.00 40,725.00 October 1, 2012 415,000.00 40,725.00 455,725.00 April 1, 2013 - 34,500.00 34,500.00 October 1, 2013 430,000.00 34,500.00 464,500.00 April 1, 2014 28,050.00 28,050.00 October 1, 2014 445,000.00 28,050.00 473,050.00 April 1, 2015 21,375.00 21,375.00 October 1, 2015 460,000.00 21,375.00 481,375.00 April 1, 2016 14,475.00 14,475.00 October 1, 2016 475,000.00 14,475.00 489,475.00 April 1, 2017 7,350.00 7,350.00 October 1, 2017 490,000.00 7,350.00 497,350.00 TOTALS: $3,115,000.00 $387,178.75 $3,502,178.75 5261 13137150.5 B-1 t k • • • CERTIFICATE OF ACCEPTANCE OF LEASE AGREEMENT This is to certify that the interest in real property conveyed by the Lease Agreement, dated as of September 1, 2010, between National City Joint Powers Financing Authority, as lessor, and City of National City, as lessee (the "City"), is hereby accepted by the undersigned officer on behalf of the City pursuant to the authority conferred by resolution of the City Council of the City adopted on September 21, 2010, and the lessse consents to recordation thereof by its duly authorized officer. Dated: September 28, 2010 CITY OF NATIONAL CITY, CALIFOA, as Lessee By Ron Morrison Mayor 526` 13137150 RECORDING REQUEED BY STEWART TITLE OF CALIFORNIA TO BE RECORDED AND WHEN RECORDI RETURN TO: Nixon Peabody LLP 555 West Fifth Street, 46th Floor Los Angeles, California 90013 Attention: Charles C. Wolf, Esq. DOC it 2010-0514248 11111111111111111111111111111111111111111111111111111111111 SEP 28, 2010 8:00 AM OFFICIAL RECORDS SAN DIEGO COUNTY RECORDER'S OFFICE DAVID L. BUTLER, COUNTY RECORDER FEES: 40.00 PAGES 5263 9 1111111 IIIII IIIII IIII Iill IIIII IIIII IIII IIIII IIIII IIIII IIIII IIIII IIIII IIIII IIII IIII THIS DOCUMENT IS EXEMPT FROM RECORDING 27383 OF THE CALIFORNIA GOVERNMENT CODE. 70 3 -3355�, FEES UNDER SECTION ASSIGNMENT AGREEMENT This ASSIGNMENT AGREEMENT, dated as of September 1, 2010 (this "Assignment"), is between the NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, a joint powers agency duly organized and existing under a Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, and the laws of the State of California (the "Authority"), and BANK OF AMERICA, N.A., a national banking association organized and existing under the laws of the United States of America (the "Assignee"). BACKGROUND: 1. In order to refinance the construction of a police administration building located generally at 1200 National City Boulevard in the City of National City (the "Facilities"), the City of National City (the "City") has previously leased the real property constituting the site thereof, as such real property is described more fully in Appendix A attached hereto and by this reference incorporated herein (the "Site"), together with the Facilities (collectively, the "Leased Property"), from the Authority under an Amended and Restated Lease Agreement dated as of October 1, 1998 and a Memorandum of Lease which was recorded in the Office of the San Diego County Recorder on October 26, 1998, as Document No. 1998-0690922 (the "1998 Lease Agreement"). 2. Interests in the City's lease payments under the 1998 Lease Agreement (the "1998 Lease Payments") are evidenced by the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), which were issued and delivered in the aggregate principal amount of $6,255,000 of 13137430.4 which $3,280,000 are currently outstanding (the "1998 Bonds"), the proceeds of which were applied to refinance the construction of the Facilities. 3. The City has determined to redeem the 1998 Bonds and prepay the 1998 Lease Payments and thereby terminate the 1998 Lease Agreement, and in order to raise funds for that purpose the City and the Authority have entered into a Lease Agreement dated as of September 1, 2010, which has been recorded concurrently herewith (the "Lease"), in consideration of the deposit of funds in an amount required to redeem the 1998 Bonds and prepay the 1998 Lease Payments in full. 4. In order to raise the funds needed for that purpose, the Authority wishes to assign certain of its rights under the Lease, including the right receive and enforce payment of the Lease Payments which are payable by the City under the Lease, to the Assignee hereunder. AGREEMENT: In consideration of the material covenants contained in this Assignment, the parties hereto hereby formally covenant, agree and bind themselves as follows: SECTION 1. Defined Terms. All capitalized terms not otherwise defined herein have the respective meanings given those terms in the Lease. SECTION 2. Assignment. The Authority hereby assigns to the Assignee all of the Authority's rights under the Lease (excepting only the Authority's rights under Sections 5.7 and 7.3 of the Lease), including but not limited to: (a) the right to receive and collect all of the Lease Payments from the City under the Lease, (b) the right to receive and collect any proceeds of any insurance maintained thereunder with respect to the Leased Property, or any eminent domain award (or proceeds of sale under threat of eminent domain) paid with respect to the Leased Property, and (c) the right to exercise such rights and remedies conferred on the Authority under the Lease as may be necessary or convenient (i) to enforce payment of the Lease Payments and any amounts required to be applied to the prepayment of the Lease Payments, or (ii) otherwise to protect the interests of the Assignee in the event of a default by the City under the Lease. The assignment made under this Section 2 is absolute and irrevocable, and without recourse to the Authority. 5264 13137430.4 -2- SECTION 3. Acceptance; Representations. The Assignee hereby accepts the assignments made herein for the purpose of securing the payments due under the Lease to, and the rights under the Lease of, the Authority. The Assignee represents that (i) it accepts this interest in the Lease for its own account and will not make a public offering of the interests conveyed hereby, (ii) it is paying the price of par for its interest in the Lease, and (iii) it will treat its interest in the Lease as an investment for federal income tax purposes. SECTION 4. Consideration; Deposit of Funds. In consideration of the assignment to the Assignee of the Lease Payments and certain other rights of the Authority under Section 2, the Assignee hereby agrees to pay the following amounts to the following parties: (a) On the Closing Date, the Assignee shall pay the amount of $42,920.09 to Union Bank, N.A., as custodian, to be applied for the purpose of paying financing costs relating to the Lease. (b) On the Closing Date, the Assignee shall pay the amount of $3,072,079.91 to Union Bank, N.A., to be deposited, held and applied in accordance with the Refunding Instructions for the purpose of refinancing and discharging the 1998 Lease Payments and the 1998 Bonds. SECTION 5. Execution in Counterparts. This Assignment may be executed in any number of counterparts, each of which is an original and all together constitute one and the same agreement. Separate counterparts of this Assignment may be separately executed by the Assignee and the Authority, both with the same force and effect as though the same counterpart had been executed by the Assignee and the Authority. SECTION 6. Binding Effect. This Assignment inures to the benefit of and binds the Authority and the Assignee, and their respective successors and assigns, subject, however, to the limitations contained herein. SECTION 7. Governing Law. This Assignment is governed by the laws of the State of California. 5265 13137430.4 -3- IN WITNESS WHEREOF, the parties have executed this Assignment Agreement by their duly authorized officers as of the day and year first written above. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, as Assignor By Approved as to Form: By t# ,s‘A l Counsel Attest: By Ron Morrison Chairman BANK OF AMERICA, N.A., as Assignee By Authorized Officer 5'e 6 6 13137430 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California County of .-21 D j 036 //.2 On q.3/D ate personally appeared 64 before me, } /� `: ere Name and Title o er 2or-r� C Name(s) of Signer(s) 5267 �tl WjIDI IC, VIRGINIA M. ORCUTT • I`- Commission in 1874998 Notary Public - California i f San Diego County Comm. Exres Dec 26, 2013 Place Notary Seal Above who proved to me on the basis of satisfactory evidence to be the persoq(s) whose name(s)-is/are-subscribed to the within instrument and acknowledged to me that he/shelthey-executed the same in hisihecAbeic_authorized capacity(ies), and that by his/her/their-signature(e)-on the instrument the person(a), or the entity upon behalf of which the persoi (s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature OPTIONAL Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) Other Than Named Above: Signature of Notary btic Capacity(ies) Claimed by Signer(s) Signer's Name: ❑ Individual ❑ Corporate Officer—Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Top of thumb here Signer's Name: ❑ Individual ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: RIGHT THUMBPRINT OF SIGNER Top of thumb here * 2007 National Notary Assodalan • 9350 De Soto Ave., P.O. Box 2402 •Chatsworth, CA 91313-2402 • www.NationaMbtary.org Item #5907 Reorder: Call Toll -Free 1-800-876-6827 IN WITNESS WHEREOF, the parties have executed this Assignment Agreement by their duly authorized officers as of the day and year first written above. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, as Assignor By Ron Morrison Chairman Approved as to Form: By General Counsel Attest: By Secretary BANK OF AMERICA, N.A., as Assignee By Assistant Vice President 5268 13137430 5269 ACKNOWLEDGMENT State of Califor is County of . _) T �f�,� Y/•Sf �_) On g1a7116 before me, F(kfN U. {1}Cet/r f1Q,l \ U.6L t G (insert name and title of the officer) personally appeared Pv .01-t Lt)O �GLL?L) I who proved to me on th basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. (Seal) EILEEN U. HARWELL Commission / 171541E6 Notary Public - California f San Francisco County M1Corin.E MSSJun2S,2D1t t APPENDIX A DESCRIPTION OF THE LEASED PROPERTY The Leased Property consists of the following described land located in the City of National City, County of San Diego, State of California, together with all buildings, facilities and other improvements which constitute real property and which are located thereon: PARCEL A: PARCEL(S) 1 AND 2 OF PARCEL MAP NO. 4027, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY AUGUST 21, 1975 AS FILE NO. 75- 224074 OF OFFICIAL, RECORDS. PARCEL B: THE WEST 33-1/3 FEET OF LOTS 7 TO 10, INCLUSIVE, IN BLOCK 13 OF THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP NO. 348, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL C: THE WESTERLY 33 1/3 FEET OF THE EASTERLY 66 2/3 FEET OF LOTS 7 TO 10 INCLUSIVE IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL D: THE EASTERLY 33 1/3 FEET OF LOTS 7, 8, 9 AND 10 OF BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL E: THE SOUTHERLY 100 FEET OF LOT 11 AND THE SOUTHERLY 100 FEET OF THE WESTERLY EIGHT AND ONE-THIRD FEET OF LOT 12 EN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL F: LOTS 13 THROUGH 17 IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF 13137430.4 A-1 52r0 NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL G: LOT 6, THE NORTH 25 PEST OF LOTS 11 AND 12 AND THE EAST 16 2/3 FEET OF SOUTH 100 FEET OF LOT 12, ALL IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL H: A. PERMANENT EASEMENT AND RIGHT-OF-WAY TO CONSTRUCT, RECONSTRUCT, MAINTAIN, OPERATE AND REPAIR AN UNDERGROUND EMERGENCY GENERATOR FUEL TANK, DESCRIBED AS FOLLOWS: ALL THAT PORTION OF 12TH STREET, LYING NORTHERLY OF BLOCK 13 OF MAP NUMBER 348, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWESTERLY CORNER OF SAID BLOCK 13, BEING ALSO THE NORTHWESTERLY CORNER OF PARCEL 1 OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF SAID PARCEL 1, 75 FEET TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING EASTERLY ALONG SAID NORTHERLY LINE, SIGHT FEET; THENCE LEAVING SAID NORTHERLY LINE, AT RIGHT ANGLES, NORTH SIX FEET; THENCE WESTERLY, PARALLEL WITH THE NORTHERLY LINE OF SAID PARCEL 1, EIGHT FEET; THENCE AT RIGHT ANGLES, SOUTH, SIX FEET TO THE TRUE POINT OF BEGINNING, CONTAINING 48 SQUARE FEET. 13137430.4 A-2 527 tCoverntnent Cade Section.65ti4.5 nr G5(33: i } instructions: I . Complete and mail to: Secretary of State, ,P.O.Box 944 Sacramento, CA 942442250 (916)"324-6778 2 include filing fee of $5 IX). 3: Do not include attachments, unless otherwise specified c Gol1 .4, ,PR91991 riAJ Ct[ ' ic`•E. SECRETARY'!'F St:: The name of the agency or entity created under the agreement and responsible for the administration of the agr -•ment is National City -Joint Powers, F`inanci,ng Authority, Nailing address 1243 National: City Boulevard, National City, CA;` Provide a short title of the agreement if::applieable•' Joint Exercise: of :Powers; Agreement By and Betweeen the City of National City ;end the Community` DevelopmentCommission of the City of National City The public agencies party to the agreement are (1) City of National City. 41 Community Development; Commission -'of the City, of National City ;3) ,if more space is needed; continue on`a, separate sheet:and attach it to6this form. - The effective date of the agreement is.. c.ii 1,. 1991 Provide a condensed state•ment of the: agreement's purpose or the powers to be exercised: To provide for the financing.• of public• capital. improVemi:nts" €or tht� member ;public agencies through,the issuance of. bands and the. leasing of public capital improvements to the members. Date; April 23. 1991 Sqc/Stutr ram tP/ George' -II, Eiser, ' III, Legal 'Advisor. Typed N.,rn'e :iird Titre RerI 1188 e ` vitararia i. tr pro �'' 4i.�A' @'4'WM FILE;lO. ) 2-- 0.7 rilate Dike of the "if the. Sttbtef Ca?1e MAY 23 2 �f fELJCEIES." ^. - (office UseonlyJ,, AMENDMENT TO A JOINT POWERS AGREEMENT ;CovernmentCode Section 65O .5 er 6503,7) Zr33trijcticn s: 9. aTopicte anti mail :o: Secretary of State, P.O. Box 944225, Sacra muittc, CA R4244-2250 (916) S53-3984. 2, to iude. filing Pee of":,5.00. . Do not irclure attachments. Date of filing iAi lei notice with the Secretary of State: April "/),t 1491 T=i`e number of initial notice: 1140 Authority Name of Joint Powers agreement: National City Joint Powers Fi..ctenc4,rig Mailing Address: 124 } national City_Boulev<-rrd, Natione.l City, CA 9195 -43Q1: Comple to one or more boxes below. The agreement has been ameneed to: ; Change the parries to the agreement as follows: i Change the name of the administering agency or entity as follows: Change the purpose of the agreement or the powers -to be exercised as follows;' - Chane the short title. of the aggreement.as follows: Make , nti <er changes to the agreement as follows: Authorize the Authority to enter into Bond Plt char. Agreements with the=Coa.munity- Deve10 meiat_Cctnmiission of the .- City, o ': -ationa7 City,. CAy 12- 20Q . - ' " ' ,S . i�ytte _ �etj Charle_, .. Adaas, ,ones:Flal1.. Typ4tl l' ame aril THte APLC , as : Bond Counsel :9tJ:�tatR tFee. t I hereby certify tlial4e foregpoingtransaipt isas M, title and fcorrec copy 61,1)s) original record in the custody of the California Secretary of State's office. SEP 2 4 2010d* Date: DEBRA BOWEN, Secretary of State BEST#�� 'ttttr of iIifDrina 'ong Ea Ttr to urr ; rrretan; S1 "rE\tFFNT Cir FACTS ROS'T'f:R C)t}�til3l.lt; At;F:NF;1F5 Fl NC (;c»err'intrrtt ('fulr Sect iorr.5i()I I C:(finjdete and mar`St9;rria:rl if 4f'tte, P(_)'f;o.,941225..4:ac-raruento,(,A!)d24:'1—.0t)ifxIfr3'24 street address roust he uncif as the official mailing.idd#ress or al, (lie address of tie presiding officer: (;.irriplete addresses are required. 11 :irn need addittorr space. please ln(lode infrii'rnation on an 11 page, Mesa 1'�Trnt; [X 1 t_ p(late f_ Le name of Pohl it As;etic Nature aif Update N/A F11-EO it 'ha olrito rz4 Cr* trtothay of Sluff of.Caiiiforelo APR2;91991- Ii 61 fMtARCNFi"z "f.1Y SECREtARY OF`S1A€E. Powers Financing Authority (;r,univ. San Diego' Oflicia119ailing Address 1243 National City Boulevard, National C'ity,i California 4195fi_ \af ae arid Address of each member of the governing board: irtiran. President or other Presiding OffiCet •r. tary or Clerk (1ndir oe Titter kleiibers Name. Michael R. Dalla Name:- Ralph Inzunza Name: Jess E. Van. Deventer Name,Rosalie Zarate Name Date ndicate Title). lcldresr 12r.3"National City Blvd., National City, CA 9T95d ,Addre; Address Address fl Address. Address - Sign ture George H. Eiser, III, Legal Advisor Chairman 1243 National City, Blvd., National City, CA 91950 1243 National City Blvd., National City, CA 91950 .Ae Sfro Form 1.P;'S13-405 Rev. 4/89 San Diego.. gtate of Ciraliforiiia> LLurcif iTUUg +Eu tItrrethr.i{ et ftatt 1�i1;1 Vf.Ai'•t)fr TA( [S hOSTER • 7 (drlitirli•h aIll rn.til tn: Statr.` I>-O 11,4,v ti44.225 yart:iinent.o. (.:.1 9121:I- 23>fl �FJi.ht 3�-f-hT 5 1'gteet ,uldr'.ss mist }rdr -..It'en as tht oifiei:11 mail.inq asldre�s •1-asIh.of thrr.iarr,,itiit-Euliuw>.= 4. to;rnpletr are n riutrrd. I. If \ull Need ackiltlnital`>(lateinclude [tllorIIYatltrrr Un art Y.) 6 d \r\t'.T'�I1i115 r.1 FILED e efQ4c{�ih*See cie • Ut e,e"dtel¢et Ca lereio C 211992 r p l.e, Lt.i..Crvl.t 4'' 'T,1„a . Fk ttgtk! .i*: U - " National City Joint Powers -Financing -Authority \aturtnl ttxiutrt Change- of Membership unt\ �Ificial lfailini-Addresv. 124'3 National City Boulevard National Cityj California 91950 \.Irnt• ettd 1ll(lrt�b ,9i t'GelI, iiir r lb r r'i the., grrye'rtitnu board: t,lrurulail. Presid,nlsrr'nClie•1 fri�;i,liu .l7f i�4rr:frnliLlt I�ft'f0: Chairman \rung.. George it. Waters 1dt111',. 1243 National City Blvd., National City, CA 91950 ir.rk (iare flit,. Secretary \,,rl,e;. Tom G. McCabe iddr,,,, 1243: National. City Blvd., National City, CA 91950 SI(n skier \,, ;,,. .4ichael R. Dalla 1,Idr, ss 1243 National City Blvd.', National City, CA 91950.: Ralph' Inzunza Ron Morrison: „nr_ lddlrs Rosalie: C. Zarate' „ \ani�-.-�ae �ldtlrt•ss \awe: Address. - • Sethll�;• George. H. )riser, f't`Ypkd Vyabc'' �, ,a rtarg of itite FILED E tt a ettiee e1 tiie:Seerry et data ol, the SOB el ClIlle;nte E' ATEMENT OF FACTS ROSTER OF PUBLIC AGENCIES (Government Code Seetian:5�30.5 instructions: 1. Complete and mail to: Secretary of State, P.O. Box 9-14225. Sacramento. CA 94244-2250 .916t 32.1-5775: 2. A street address must he given as the official mailing address or as the address of the presiding officer. i.,.Complete addresses are required. 4. : if you need additional space. please include information on an St;..., X 11 page. Update t XI National Ci. Nature of Updave Chance of Membership County San Diego Official Mailing Address anal City Boulevard National City California.', 91550 Name and Address of each member of, the ,governing board: Chairman. President or other Presiding Officer ,Indicate Title': Chairman Name: George H. Waters. A,4d•ess 1243 National City Blvd., National: City, Secretary or Clerk (Indicate Titled Sea.-etary tigq„ .e. Paul Desrochers address 1243 National G t^ B!:�rci., t tlar Ca;t bees asrs Nitch. Beatichamp Address 1243 Nitional City Blvd., National 'lame:` .Ralph Inzunza Address i ROri "Morrson Name, Address: Name: Rosalie G. Zarate ' Address Name _ . _ Address irecember 6 , 1.99 4 spat= George II. Eis i ppsai: Name sea Title , STATEMENT OF FACTS ROS"ER OF PUBLIC . AGENCIESS . FILING Government Code Sec!:ion.53051) Instructions: Complete and mail to: Secretary of State, P 0 Box 944225, Sacramento, CA 94244.2250,(916) 324-6778 A street address must be givenas the official mailing address, or as the address of the presiding officer 3. Complete addresses are required. 4 If vou'need additional space, please include information on, an S'.z,. XI:1 page. New Filing [ } Update;l„g } National City Joint Faftrs.:Financing Authority (Office Use: Only) Legal nar. l.,- if Public Agency: Nature of Update: ChangP of N'Ir,',j. „aunty -Ci3Lt DiPgo' Official *Mailing Address: Natj•rrnal��i.ty, rat- -fnYnia -91950 Name and Address of each member of the governing board: Chairman, President or other Presiding Officer (Indicate Title): Chairman Name: George H. Waters Address: 1243 National City Blvd., National City, CA Secretary- or: Clerk; (Indicate Title): Secretary Name: Tom G. 'McCabe Members:'. Name, Mitch Beauchamp Address. Name: RAlph Tnron7q Address. Name. Ron MDrrison" - . Address: Name: Fred. Soto Address Name Address.: Address- 1243. National City Blvd.., National city, •CA ;1950 Sec/Stole ,O5.Rer. 4f89 1243"Nati.onal City; -Blvd. , 'National. City, C11; By: signature - r George H."'Eiser;..III, Legal.Crounsel." Typed Name and Titie, r_f 1 WM STATEMENT OF; FACTS. ROSTER OF PUBLIC AGENCIES FiLii G: (Government CodeSection53051) instructions:- t. Complete and mail fa Secretary of State P.0. Box 944225, Sacramento, CA 94244-2250 (916) 653-3984 (office t ism only) 2. A street address must be given as the official' mailing address or as the address of the presiding officer, 3. Complete addresses as required: 4. If you need additional space, pleaseIncludeinformation on an 81/2 X 11 page. New Filing © Update ' Legal name of Public Agency: National City 'Join • P era Financing Authority Nature of, Update: (i arise of rstiip County: San Diego, Official Mailing Address: 1243' National City; Boulevard.: Natiaaal _City, CA 91950-4301 Name and. Address of ea^h member of the governing, board': . tibairman President or other"Rrestdina Offlcef (Indicate Title): Chaff rnian Name: C-3orge. H. Waters Address: `1243 N,:i. ' 1 icy Soulp�rarr� Nai•inn!'tL , 91950- 3't Secretary or Clerk (Indicate TWO: Secrey, Address: 1243 National' City Blve.. National Ci, Narne, -TornG. r-Ca CA 91950-430 Members riitch 3eau,.:-•.ui ' Addressr - •1.243 National City Blvd', Natiotlai',Ci Name: '� CF1 9195a-4301 • Name; Nick : Inzunza -- Address:. f as ') - ' , Name- , Ron. [4orri3on Address:• f 4ai ib-) Name:- • } red'; SotcY Address: (satrra}, '':.Addebar, ; Geor,ye ii,, Eiser, .IIx, - Legal Gov! Sel Typed Hama and 'ti!$. I State of a l iforria Bilk=.on Secretary of S tate STATEMENT OF FACTS ROSTER OF PUBLIC AGENCIES FILING (Government Code Section 53051); ins ructions; 1, Complete and mail to: Secretary of State, P,O. Box 944225, Sacramento, CA 94244-2250 (916) 653-3984 a: A street address must be giver} as theofficial mailing' address or as the address of the presiding officer. 3. Complete addresses as required,% at1c ofhliS ref*v fStet of the Slate of CetitoThis 1AN` Jl{i1 irI1L JG�tE3, Chary nt State (Office Use Only) 4. If you need additional space, please include information on an 8 4 X 11 page. New Filing Q UpdateEl3 Legal name of Public Agency: National City :joint- PcMers - Fir aneingAuthority Nature of Update: County San. Diego Official Mailing Address: 1243 National City Boulevard National -City, CA 91950-4301 Name and Address of each member of the governing board:' Chairman, President or other Presiding Officet' (Indicate Title): f lai:ij an: Name: George H. Waters Address: 1243 Nat j ran l �i a�,nl pya _.Nxi-i onal_ Secretary or Clerk (Indicate Title): Secretary ; CA - 91950-43/ 1 Name: Tom G. McC,abr. Address: 1243 National City Blvd, National Cit, ;r CA 91950-430 j embers: Name: Mitch Beauchamp Address: 1243 National City Blvd; National Ci. Name: Nick Inzunza Address.. icamr l CA 91950-4301 Name: Ron Morrison Address: Name: Fld. Soto - Address: _ . ; (sane) Name Address: .",k'O rATE LP, January 10, 200] signature - - - r urge fi: El ser, III, Legal Counsel Typed Name and Title - - _' inttteoficeoftha`Barrel cy:if5bt of theStat r-at 3liior;tia: _ • STATEME T; F FACTS. ROSTER OF PUBLIC"AGENCIE"S FILH\iG !t, vernmentCode-Section.5305t) ions: Cernplete am Talk to: Secretaryof State; P.C. Box 942377, Sacrarrtemo, CA 9927 F:o.001 (916) 65473984 A Street address must be given as the official mailit•tg ,dd"ress nr as the ad fuss of.the:presiding offiicer. Ct,;trtplete addresses -as required,. !f yeiti need additional.space, please include information onati 61./i:X 11 i Netiv.arilling: Lifpdate_ IC . L ga! Hanle ol,Pzi;,tic:Agency National CttyJoint.. Poyirc rs Financiry Authority f.`attrre of Update: Chanile of.MernbershiP Gotinty: San olcgo ()Mole; Mailing Address: 1243-t atiocal.City Bauievard National City, CA 9.1950-4301 -- _ sane and ,Address of each member otthe -governing board: Chairman Psesident or other Presiding Office (Indicate Title): Chairman �--.. 'lame: r,iak Inaun'a Address'. 12.43National -City_ Boulevard, National City, CA 91950-4301 iecrel )rClerk (Indicate title): Secretary „i;r t ris Zap ,ta_ Address:- 1243;Natieeal'City B1Vc.;_National City, CA 91950.' Mai`iher ^Marne: t- o t ginsor Address 1243. Nationat Gity Btv"d.; National` City, CA 9 954'- ., N Tyne. t o s N. tividad Address': 243 National City•Blvd .National Cijy CR 9995P mange: i ogre ,;.ro f'arra ..____. Andress. 1243 National City Blvd.:. National 'ity GA-9195o Name: Fiddles tJ..gad i'.ddre ss tL43_National City,:°lvd_, National City,,CA 9196G` , AddresSF Date: .ii ne 16. 2004. chrts 422:a ivied;Marroe l:FlI�H"'t;:��l L1 nT i i; Nativdad` STATEMENT OF FACTS . , F OSTER OF t1BLIC AGENCI S,FfLi�i • t ;cc-err;iffierit Co e Ser on-53051) nrl r7 t f tr_. ecre; ., 42671. Sxacrament z,. )e C iVl-2*1-.35 [f1C'ialfflCtal.. •e greSidi effir:er regt iced' !,'✓qt.. nnf?t'�-�dC: iisr rl:,i413rIa',: �'' DI@3se IIl Chide fni9rnl'dl€C1f1 e !jpdaUj ;Irss`Q, 1at-Cit ow rs'I Ir nclna Authr�rit ire of a>e C1^,anc e of inert ;bersh 124:3 €,4att-en.e1 C' Baclieu t i, Natrattz.1 i; t,s CA, A,d-'ress., ,t each inereber of they 'ierning poactl. _n Praaide hf i efrr APr?sidistf0.f L fi, dic3'e-T ti r h21 R1a41 inziln2 "� _ > dc0:3S-, 1 Ivh'ati CAT Blvd N.,I 'aI,E;aty, CA 91" 3 1 C Ceiv =cjicafe TA if (amity ... , Z� ,3t - i�ress -4 1aticinohE. E(y" 6CYti va_,. �� h'a'lam "�, Ekvc.:.;$ %r.j i lmfC,'sat C - v is V"`1 .' : frc ,. Add re-s �t'"l�lae ff-;ity,fi ! .. 'tiddreSS "•la i,..,alioitai +_ i r xivo,: r..t. r+ 4s, :r�rue H Etter Ei -001 Cip r', Mate of Cd iforni, Secretary Q:f Mate: STATEMENT OF FACTS ROSTER,CF' PUBLICGEN;C <AIES FILING (;Government Cads-Sectigri 305t 1 ist.oCtons Complete and mai; to.: Secretary of State, • P.O. Hoy ''-2877. Sacramento, CA 94277-000T (516) ,65,3.3984 A street address must be given., as the official mailinga•ddress or as- . ftte ..1oress-:af the -presiding offioer; Complete addresses as -required.- 4 If 'yoi need additional -'Space, please :ncllida information on an 8 4 X 11 page; Ne'a i r.g update National City E_ep`a4-name of Public Agency here of'Update Change: of rTi rstip San- Diego Address ozr"t- c, ier-s =F 1243 National City Boulevard National City, Ct',91950-4301 in the office of Ito Sec teary of State of the State of Caiiforilfa- FFB 2 0 20N" ranting Autt ori- name and Address of each member of the governing board. CkPtaaar-. esrdent or nth Presiding Office (Indtaate Titie) Ron . )rrison . Address: 1243 National City.Blvd Name' Sarrerary LClerk ElndCate Titiej secretar! Ct i s Zapata - Address rdaaa. e Flame. Lids NatiVidad Nam ; Frank P arra Name. Fideles iosalie Zarate National City. 12.43 National City. Blvd fa'iional C'zty; e l-3l95tT-4:3U Address: 1243 National City Blvd, - National. City Address 1243 National City Blvd,„ National -City Address: 1243 National City Blvd, N ttional City Address, 1243 National City. Blvir National City Address. nature TiPe4 Nanie.and. Tale . • • ,. STATEMENT OF RosTeFtoF•OUBLia'AdOtig. (Gavem.rrteptydeiStie.rt..5::3051),- • .. • • . • ..•., • •••[ -• •-.- • ...• : . „..„ , , , Secretary of Stale, 53. Com:Plate and a t° GA •%421-r,nnOt (916-) 6 3984 •i•Oece Uwc)Y) street address must be groeh as the 1oal mailing 3 complete acicia.c.AK:asraquy 4 if you need additional nctude mforrnatton On an 0.7,4X I page New Filing _pate Powers FinanclqgikuthoritY Natio4lai City Joint Legal name of -Pubto AgeecY Nature of Update Chance of rnemberafeci • Official Mlincj,?0aress: •1243 Naikbrtet•Ciffr-pigtrieVard,,' ••••• .•ai. • _. • . , . .-.: • • • • - • • • .• • ., , ,„. . National City. CA 91950-4301 .,• , • ; • . rd NaMeehci.Adress• of•eath rnerner of tie goernlr'g"*° Chairman ..,...., ........ • • Naive RcriMcrnscn • CA419'50.4301 •City • • - • Chris' Zapata: • . • • seretaty Clerk. ktrgica-10- • Frank Paa• .;Address .s..-..: 7 fsia:!,zratt 51.450.4Y21' "nle' aire i-tiejandra'Sibte10-8.03s•: • • • • • - ,-• - • • f4 ame- Jess Van: Deventer. . •Addres' Name Rosalie Zarate ,„ , • • • • iogOwtt Date: I tranocandy that die foregoingf e(a) K e tut true and correct of the original record in the cult. • of the California Secretary of Slate's office. SEP 2 4 201i DEBRA BOWEN, Secretary of State $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. CERTIFICATE REGARDING EFFECTIVENESS OF JOINT EXERCISE OF POWERS AGREEMENT The undersigned hereby states and certifies: (i) that the undersigned is the duly elected or appointed, qualified and acting Chairman of the National City Joint Powers Financing Authority, a joint exercise of powers agency duly organized and existing under the Constitution and the laws of the State of California (the "Authority") and operating pursuant to Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State of California the "Act") and pursuant to that certain Joint Exercise of Powers Agreement, dated April 1, 1991 (the "Agreement"), by and between the City of National City and the Community Development Commission of the City of National City, and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same; (ii) that attached hereto is a true, correct and complete copy of the Agreement, which Agreement has not been amended, modified, supplemented, rescinded or repealed, and is in full force and effect as of the date hereof; and (iii) that all required filings have been made with the Secretary of State of the State of California, and the Authority is in good standing as a joint exercise of powers agency under the Act. [Signature Page Follows] 13145742.3 WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY By: on Morrison Chairman 13145742 [Certificate re Effectiveness of JPA] JOINT EXERCISE OF POWERS AGREEMENT BY AND BETWEEN TIE CITY OF NATIONAL CITY AND THE COMMUNITY DEVELOPMENT COMIVIISSION OF THE CITY OF NATIONAL CITY RESOI.L r,0N 91-b5 JOTh T EXERCISE OF POWERS AGREEMENT THIS AGREEMENT, dated as of April 1, 1991, by and between the CITY OF NATIONAL CITY, a municipal corporation duly organized and existing under the laws of the State of California (herein called the "City"), and the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY, a public body, corporate and politic, duly organized and existing under the laws of the State of California (herein called "CDC"). WITNESSETEE WHEREAS, Articles 1 and 2 of Chapter 6 of Division 7 of Title 1 of the Government Code of the State of California authorize the City and CDC to create a joint exercise of powers entity (herein called the "National City Joint Powers Financing Authority" or the "Authority") which has the power to jointly exercise any powers common to the City and CDC; WHEREAS, the City and CDC are each empowered by law to undertake certain projects and programs; WHEREAS, the City is authorized to enter into leases for certain public purposes pursuant to the Government Code of the State of California; WHEREAS, CDC is authorized to enter into leases for any of its corporate purposes pursuant to the provisions of the Community Redevelopment Law; WHEREAS, the City and CDC have decided to jointly finance a new police facility for use by the City; and WHEREAS, the Marks -Roos Local Bond Pooling Act of 1985 (hereinafter defined as the "Bond Law") authorizes agencies formed under the Joint Exercise of Powers Law (hereinafter defined as the "Act") to issue bonds for the purpose of acquiring and constructing Public Capital Improvements (as that term is defined in the Act) and to lease those Public Capital Improvements to local agencies; WHEREAS, by this Agreement, the City and CDC desire to create and establish the National City Joint Powers Financing Authority for the purposes set forth herein and to exercise the powers described herein; NOW, THEREFORE, the City and CDC, for and in consideration of the mutual promises and agreements herein contained, do agree as follows: ARTICLE I DEFINITIONS Section 1.01. Definitions, Unless the context otherwise requires, the words and terms defined in this Article shall, for the purpose hereof, have the meanings herein specified. "Act" means Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State. -1- "Agreement" means this Agreement. "Auditor and Treasurer" means the Finance Director of the City, designated as Auditor and Treasurer of the Authority in Section 3.02. "Authority" means the National City Joint Powers Financing Authority created pursuant to this Agreement. 'Bond Law" means the Marks -Roos Local Bond Pooling Act of 1985, being Article 4 of the Act (commencing with Section 6584), as now or hereafter amended, or any other law hereafter legally available for use by the Authority in the authorization and issuance of Bonds to finance the acquisition of Obligations and/or Public Capital Improvements. "Bonds" means bonds of the Authority issued pursuant to Section 6590 or 6591 of the Bond Law. "Chairman" means the chairman of the Authority. "Commission" means the Commission referred to in Section 2.03, which shall be the governing body of the Authority. "Commissioners" means the representatives of the Members appointed to the Commission pursuant to Section 2.03. "Fiscal Year" means the period from July 1 to and including the following June 30. "Members and Member" means each of the parties to this Agreement and "Member" means any such party. "Public Agency" means any public agency authorized by the Act to enter into a joint exercise of powers agreement with the Members. "Public Capital Improvement" has the meaning given to such term in Section 6585(g) of the Act, as in effect on the date hereof, and as hereinafter amended. "Secretary" means the secretary of the Authority. "State" means the State of California. 'Vice Chairman" means the vice chairman of the Authority. ARTICLE II GENERAL PROVISIONS Section 2.01. purpose, This Agreement is made pursuant to the Act providing for the joint exercise of powers common to the Members. The purpose of this Agreement is to provide for the financing of Public Capital Improvements for the Members through the issuance of Bonds by the Authority and the leasing of the Public Capital Improvements to the Members. Section 2.02. Creation of Authority. Pursuant to the Act, there is hereby created a public entity to be known as the "National City Joint Powers Financing Authority". The Authority shall be a public entity separate and apart from the Members, and shall administer this Agreement. Section 2.03. Cotnfniaaion, The Authority shall be administered by a Commission consisting of five (5) Commissioners. The Mayor, Vice -Mayor, and members of the City Council of the City and the Chairman, Vice -Chairman, and Members of the governing body of the CDC ex officio shall constitute the Chairman, Vice -Chairman, and Commissioners of the Authority, respectively. The number of Commissioners may be changed by amendment of this Agreement. The Commission shall be called the "Commission of the National City Joint Powers Financing Authority". All voting power of the Authority shall reside in the Commission. Section 2.04. )'jeetince of the Commission, (a) Regular Meetin¢s, The Commission shall provide for its regular meetings; provided, however, that at least one regular meeting shall be held each year. The date, hour and place of the holding of regular meetings shall be fixed by resolution of the Commission and a copy of such resolution shall be filed with each of the Members. (b) Special Meetings, Special meetings of the Commission may be called in accordance with the provisions of Section 64956 of the Government Code of the State. (c) Call. Notic and Conduct of Meetines, All meetings of the Commission, including without limitation, regular, adjourned regular and special meetings, shall be called, noticed, held and conducted in accordance with the provisions of Sections 64950 et seq. of the Government Code of the State. • Section 2.06. Minutes, The Secretary shall cause to be kept minutes of the meetings of the Commission and shall, as soon as possible after each meeting, cause a copy of the minutes to be forwarded to each Commissioner and to each of the Members. Section 2.06. YAM, Each Commissioner shall have one vote. Section 2.07. Quorum: Reauired Votes: Annrovala, Commissioners holding a majority of the votes shall constitute a quorum for the transaction of business, except that Less than a quorum may adjourn from time to time. The affirmative votes of at least a majority of the Commissioners shall be required to take any action by the Commission. Section 2.08. Bylaws, The Commission may adopt, from time to time, such bylaws, rules and regulations for the conduct of its meetings as are necessary for the purposes hereof. ARTICLE III OFFICERS AND EMPLOYEES Section 3.01. (Chairman. and Vice•Chairman The officers shall perform the duties normal to said offices; and (a) the Chairman shall sign all contracts on behalf of the Authority, and shall perform such other duties as may be imposed by the Commission; and (b) the Vice Chairman shall act, sign contracts and perform all of the Chairman's duties in the absence of the Chairman. Section 3.02. Secretary. The City Manager of the City is hereby designated as the Secretary of the Authority. The Secretary shall countersign all contracts signed by the Chairman or Vice Chairman on behalf of the Authority. perform such other duties as may be imposed by the Commission and cause the Secretary of State's standard form -3- relating to joint exercise of powers agreements to be filed with the California Secretary of State pursuant to the Act. Section 3.03. Antor and Treasurer, Pursuant to Section 6505.6 of the Act, the Finance Director of the City is hereby designated as the Auditor and Treasurer of the Authority. The Auditor and Treasurer shall be the depository, shall have custody of all of the accounts, funds and money of the Authority from whatever source, shall have the duties and obligations set forth in Sections 6505 and 6505.5 of the Act and shall assure that there shall be strict accountability of all funds and reporting of all receipts and disbursements of the Authority. Section 3.04. Officers in Outage of Records. Funds and Accounts, Pursuant to Section 6505.1 of the Act, the Auditor and Treasurer shall have charge of, handle and have access to all accounts, funds and money of the Authority and all records of the Authority relating thereto; and the Secretary shall have charge of, handle and have access to all other records of the Authority. Section 3.05. From time to time, the Commission may designate persons, in addition to the Secretary and the Auditor and Treasurer, having charge of, handling or having access to any records, funds or accounts or other Public Capital Improvements of the Authority, and the respective amounts of the official bonds of the Secretary and the Auditor and Treasurer and such other persons pursuant to Section 6505.1 of the Act. Section 3.06. j asral Advisor, The City Attorney of the City is hereby designated as the Legal Advisor of the Authority. The Legal Advisor shall perform such duties as may be prescribed by the Commission. Section 3.07. Other Enanlovees, The Commission shall have the power to appoint and employ such other consultants and independent contractors as may be necessary for the purposes of this Agreement. All of the privileges and immunities from liability, exemption from laws, ordinances and rules, all pension, relief, disability, workers' compensation and other benefits which apply to the activities of officers, agents, or employees of a Public Agency when performing their respective functions shall apply to them to the same degree and extent while engaged in the performance of any of the functions and other duties under this Agreement. None of the officers, agents, or employees directly employed by the Commission shall be deemed, by reason of their employment by the Commission to be employed by any Member or, by reason of their employment by the Commission, to be subject to any of the requirements of the Members. Section 3.08. Assistant Officers, The Commission may appoint such assistants to act in the place of the Secretary or other officers of the Authority (other than any Commissioner) as the Commission shall from time to time deem appropriate. . . ...,t. -.. •, - ARTICLE N POWERS Section 4.01. S',.npral Powers, The Authority shall exercise in the manner herein provided the powers common to each of the Members and necessary to the accomplishment of the purposes of this Agreement, subject to the restrictions set forth in • Section 4.04, including but not limited to the common power of eminent domain with respect to Public Capital Improvements. As provided in the Act, the Authority shall be a public entity separate from the Members. The Authority shall have the power to finance the acquisition of Public Capital Improvements necessary or convenient for the operation of the Members, and to acquire Obligations of the Members. Section 4.02. power to Issue Bonds, The Authority shall have all of the powers provided in Article 4 of the Act (commencing with Section 6584), including the power to issue Bonds under the Bond Law. Section 4.03. pnecific Powers, The Authority is hereby authorized, in its own name, to do all acts necessary for the exercise of the foregoing powers, including but not limited to, any or all of the following: (a) to make and enter into contracts; (b) to employ agents or employees; (c) to acquire, construct, manage, maintain or operate any buildings, works or improvements; (d) to acquire, construct, hold and dispose of Public Capital Improvements in accordance with Rules and Regulations of the Authority, including the leasing of such Public Capital Improvements to the members; (e) to sue and be sued in its own name; (f) to incur debts, liabilities or obligations, provided that no debt, liability or obligation shall constitute a debt, liability or obligation of any of the Members; (g) to apply for, accept, receive and disburse grants, loans and other aids from any agency of the United States of America or of the State; (h) to invest any money in the treasury pursuant to Section 6505.E of the Act that is not required for the immediate necessities of the Authority, as the Authority determines is advisable, in the same manner and upon the same conditions as local agencies, pursuant to Section 53601 of the Government Code of the State; (i) to apply for letters of credit or other form of credit enhancement in order to secure the repayment of its Bonds and enter into agreements in connection therewith; (j) to carry out and enforce an the provisions of this Agreement; (k) to make and enter into Bond Purchase Agreements; (1) to purchase Obligations issued by any Member, and (m) to exercise any and all other powers as may be provided in the Bond Law. Section 4.04. Restrictions on Exercise of Certain Powers, The powers of the Authority shall be exercised in the manner provided in the Act and in the Bond Law, and, except for those powers set forth in the Bond Law, shall be subject (in accordance with Section 6509 of the Act) to the restrictions upon the manner of exercising such powers that are imposed upon the City in the exercise of similar powers. Section 4.05. nhliceRtionkof Authority, The debts, liabilities and obligations of the Authority shall not be the debts, liabilities and obligations of any of the Members. ARTICLE V METHODS OF PROCEDURE; CREDIT TO MEMBERS Section 5.01. Assun+ntion of Responsibilities By the Authoritv. As soon as practicable after the date of execution of this Agreement, the Commissioners shall give notice (in the manner required by Section 2.04) of the organizational meeting of the Commission. At said meeting the Commission shall provide for its regular meetings as required by Section 2.04. Section 5.02. Delectation of Powers, Each of the Members hereby delegates to the Authority the power and duty to acquire, by lease, lease -purchase, installment sale agreements, or otherwise, such Public Capital Improvement necessary or convenient for the operation of the Members. Section 5.03. Credit to Members, All accounts or funds created and established pursuant to any trust agreement or indenture to which the Authority is a party, and any interest earned or accrued thereon, shall inure to the benefit of the respective Members for which such funds or accounts were created. ARTICLE VI CONTRIBUTION: ACCOUNTS AND REPORTS: FUNDS Section 6.01. Contributions, The Members may in the appropriate circumstance when required hereunder. (a) make contributions from their treasuries for the purposes set forth herein, (b) make payments of public funds to defray the cost of such purposes, (c) make advances of public funds for such purposes, such advances to be repaid as provided herein, or (d) use its personnel, equipment or property in lieu of other contributions or advances. The provisions of Government Code 6513 are hereby incorporated into this Agreement. Section 6.02. Accounts and Reports, To the extent not covered by the duties assigned to a trustee chosen by the Authority, the Auditor and Treasurer shall establish and maintain such funds and accounts as may be required by good accounting practice or by any provision of any trust agreement or indenture entered into with respect to the proceeds of any Bonds issued by the Authority. The books and records of the Authority in the hands of a trustee or the Auditor and Treasurer shall be open to inspection at all reasonable times by representatives of the Members. The Auditor and Treasurer of the Authority, within 180 days after the close of each Fiscal Year, shall give a complete written report of all financial activities for such Fiscal Year to the Members to the extent such activities are not covered by the report of such trustee. The trustee appointed under any trust agreement or indenture shall establish suitable funds, furnish financial reports and provide suitable accounting procedures to carry out the provisions of said trust agreement or indenture. Said trustee may be given such duties in said trust agreement or indenture as may be desirable to carry out this Agreement. Section 6.03. Funds, Subject to the applicable provisions of any trust agreement or indenture which the Authority may enter into, which may provide for a trustee to receive, have custody of and disburse Authority funds, the Auditor and Treasurer of the Authority shall receive, have the custody of and disburse Authority funds as nearly as possible in accordance with generally accepted accounting practices, shall make the disbursements required by this Agreement or to carry out any of the provisions or purposes of this Agreement. • Section 6.04. Administrative Expenses. The Members shall pay their proportionate share (determined on the basis of a ;Umber's percentage share of any financings completed by the Authority) of administrative expenses. ARTICLE VII TERM; DISPOSITION OFASSt:iS Section 7.01. Term. This Agreement shall become effective as of the date of execution hereof by the parties hereto, and shall continue in full force and effect so long as bonds of the Authority are outstanding or any lease agreements are outstanding between the Authority and a Member or Members (or between Members). Section 7.02. Pisnnsition of Assets. Upon termination of this Agreement, all property of the Authority, both real and personal, shall be divided among the parties hereto in such manner as shall be agreed upon by the parties. ARTICLE VIII MISCELLANEOUS PROVISIONS Section 8.01. 2Voticps, Notices hereunder shall be in writing and shall be sufficient if delivered to: City of National City City Hall 1243 National City Boulevard National City, California 92050 Attn: City Clerk Section 8.02. $ection_Headings. All section headings in this Agreement are for convenience of reference only and are not to be construed as modifying or governing the language in the section referred to or to define or limit the scope of any provision of this Agreement. Section 8.03. f'1tnfund.Whenever in this Agreement any consent or approval is required, the same shall not be unreasonably withheld. Section 8.04. law Governing, This Agreement is made in the State under the constitution and laws of the State and is to be so construed. Section 8.05. Arnendn+pnta% This Agreement may be amended at any time, or from time to time, except as limited by contract with the holders of Bonds issued by the Authority or certificates of participation in payments to be made by the Authority or the Members or by applicable regulations or laws of any jurisdiction having authority, by one or more supplemental agreements executed by all of the parties to this Agreement either as required in order to carry out any of the provisions of this Agreement or for any other purpose, including without limitation addition of new parties (including any legal -7- r., entities or taxing areas heretofore or hereafter created) in pursuance of the purposes of this Agreement. Section 8.06. F,nfnrrotnont by Authority, The Authority is hereby authorized to take any or all legal or equitable actions, including but not limited to injunction and specific performance, necessary or permitted by law to enforce this Agreement Section 8.07. j3pvprability, Should any part, term at provision of this Agreement be decided by any court of competent jurisdiction to be illegal or in conflict with any law of the State, or otherwise be rendered unenforceable or ineffectual, the validity of the remaining portions or provisions shall not be affected thereby. Section 8.08. Fuccpesors, This. Agreement shall be binding upon and shall inure to the benefit of the successors of the respective Members. Neither of the Members may assign any right or obligation hereunder without the written consent of the other Member. 3 • IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and attested by their proper officers thereunto duly authorized, and their official seals to be hereto affixed, as of the day and year first above written. IIE6'2; 1 0,11-t.fri e Pt e•raOcyl City Clerk [SEAL] ATTEST: fed. ..././607—A/A,..." Secretary CITY OF NATIONAL CITY COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF NATIONAL CITY By ,/ .tL- 7.1----- ' hairman S3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. CERTIFICATE REGARDING EFFECTIVENESS OF RULES AND REGULATIONS The undersigned hereby states and certifies: (i) that the undersigned is the duly elected or appointed, qualified and acting Chairman of the National City Joint Powers Financing Authority, a joint exercise of powers agency duly organized and existing under the Constitution and the laws of the State of California (the "Authority") and operating pursuant to Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State of California the "Act") and pursuant to that certain Joint Exercise of Powers Agreement, dated April 1, 1991, by and between the City of National City and the Community Development Commission of the City of National City, and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same; and (ii) that attached hereto is a true, correct and complete copy of the Rules and Regulations of the Authority, which Rules and Regulations have not been amended, modified supplemented, rescinded or repealed, and are in full force and effect as of the date hereof. [Signature Page Follows] 13145742.3 WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY By: on Morrison Chairman 13145742 [Certificate re Effectiveness of Rules and Regulations] 24013.04 JHHW a'H 11,pch 05:2591 \10534 zdg 06. 12.91 RULES AND REGULATIONS OF NATIONAL CITY JOINT POWERS FINANCING AUTHORITY ARTICLE I DEFINITIONS; OFFICES AND SEAL Section 1.1. Definitions. All capitalized terms used herein shall have the respective meanings given such terms in the Joint Powers Authority Agreement establishing the Authority (the "Agreement"). Section 1.2. Offices, The principal office of the Authority for the transaction of business shall be 1243 National City Boulevard, National City. California 92050. The Commission may, however, fix and change from time to time the principal office from one location to another within the City of National City by noting the change of address in the minutes of the meeting of the Commission at which the address was fixed or changed. The fixing or changing of such address shall not be deemed an amendment to these Rules and Regulations. Section 1.3. SealThe Authority shall have a seal, consisting of two (2) concentric circles with the words "National City Joint Powers Financing Authority" and with the date of establishment of the Authority. ARTICLE II COMMISSION Section 2.1. Powers, Subject to the limitations of the Agreement, the terms of these Rules and Regulations, and the laws of the State of California, the powers of this Authority shall be vested in and exercised by and its property controlled and its affairs conducted by the Commission of the Authority. Section 2.2. dumber. The Commission shall have five (5) Commissioners. The number of Commissioners may be changed by a amendment of the Agreement. Section 2.3. Election. Tenure of Office and Vacancies. Pursuant to the Agreement, the Commission shall consist of the members of the City Council of the City and the Members of the governing body of the Agency ex officio shall constitute the Commissioners of the Authority. The number of Commissioners may be changed by amendment of this Agreement. The Commission shall be called the "Commission of the National City Joint Powers Financing Authority". All voting power of the Authority shall reside in the Commission. Section 2.4. Compensation. Commissioners shall serve without compensation but each Commissioner may be reimbursed his or her necessary and actual expenses, including travel incident to his services as Commissioner, pursuant to resolution of the Commission. Any Commissioner may elect, however, to decline said reimbursement. Section 2.5. Regular Meetings, Regular meetings of the Commission shall be held at such time as the Commission may fix by resolution from time to time, and if any day so fixed shall fall upon a legal holiday, then. upon the next succeeding business day at the same hour. No notice of any regular meeting of the Commission need be given to the Commissioners. Section 2.6. Special Meetings, Special meetings of the Commission shall be held whenever called by the Chairman, any Vice Chairman, or by a majority of the Commission. Section 2.7. Public Meetings: Notice of Meetings. All proceedings of the Commission shall be subject to the provisions of the Ralph M. Brown Act, constituting Chapter 9 of Part 1 of Division 2 of Title 5 of the California Government Code, and notice of the meetings of the Authority shall be given in accordance with such Act. Section 2.8. Quorum, A quorum shall consist of a majority of the members of the Commission unless a greater number is expressly required by statute, by the Agreement, or by these Rules and Regulations. Every act or decision done or made by at least two of the Commissioners present at a meeting duly held at which a quorum is present, shall be the act of the Commission. Section 2.9. Order of Business, The order of business at the regular meeting of the Commission and, so far as possible, at all other meetings of the Commission, shall be essentially as follows, except as otherwise determined by the Commissioners at such meeting: (a) Report on the number of Commissioners present in person in order to determine the existence of a quorum. (b) Reading of the notice of the meeting and proof of the delivery or mailing thereof, or the waiver or waivers of notice of the meeting then filed, as the case may be. (c) Reading of unapproved minutes of previous meetings of the Commission and the taking of action with respect to approval thereof. (d) Presentation and consideration of reports of officers and committees. (e) Unfinished business. (f) New business. (g) Adjournment. Section 2.10. Resignation and Removal of Commissioners, Any Commissioner may resign at any time by giving written notice to the Chairman or to the Commission. Such resignation shall take effect at the time specified therein, and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Any Commissioner may be removed by the Commission with or without cause at any regular meeting or at any special meeting of the Commission, the notice of which, among other things, indicates that the removal of one or more Commissioners identified therein shall be considered at such meeting. Section 2.11. Nonliability for Debts, The private property of the Commissioners shall be exempt from execution or other liability for any debts, liabilities or obligations of -2- the Authority and no Commissioner shall be liable or responsible for any debts, liabilities or obligations of the Authority. Section 2.12. Indemnity by Authority for Litigation Expenses of Officer, Commissioner or Employee, Should any Commissioner, officer or employee of the Authority be sued, either alone or with others, because he is or was a director, officer or employee of the Authority, in any proceeding arising out of his alleged misfeasance or nonfeasance in the performance of his duties or out of any alleged wrongful act against the Authority or by the Authority, indemnity for his reasonable expenses, including attorneys' fees incurred in the defense of the proceedings, may be assessed against the Authority or its receiver by the court in the same or a separate proceeding if the person sued acted in good faith and in a manner such person reasonably believed to be in the best interests of the Authority and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of such person was unlawful. The amount of such indemnity shall equal the amount of the expenses, including attorneys' fees, incurred in the defense of the proceeding. ARTICLE 111 Orr ICERS Section 3.1. Officers, The officers of the Authority shall be a Chairman, a Vice Chairman, a Secretary and such other officers as the Commission may appoint. When the duties do not conflict, one person, other than the Chairman, may hold more than one of these offices. Section 3.2. Election of Officers, The Chairman, Vice Chairman and Secretary shall be chosen annually by the Commission and each shall hold office until he shall resign or shall be removed, shall resign or otherwise shall be disqualified to serve or his successor shall be elected and qualified to serve. Section 3.3. Subordinate Officers, The Commission may elect or authorize the appointment of such other officers than those hereinabove mentioned as the business of the Authority may require, each of whom shall hold office for such period, have such authority and perform such duties as are provided in these Rules and Regulations, or as the Commission from time to time may authorize or determine. Section 3.4. Removal of Officers, Any officer may be removed, either with or without cause, by a majority of the Commissioners then in office at any regular or special meeting of the Authority, or, except in the case of an officer chosen by the Commission, by any officers upon whom such power of removal may be conferred by the Commission. Should a vacancy occur in any office as a result of death, resignation, removal, disqualification or any other cause, the Commission may delegate the powers and duties of such office to any officers or to any Commissioners until such time as a successor for said office has been elected or appointed. Section 3.5. Chairman. The Chairman shall preside at all meetings of the Commission and exercise and perform such other powers and duties as may be from time to time assigned to him by the Commission or be prescribed by these Rules and Regulations. The Chairman shall also be the chief corporate officer of the Authority and shall, subject to the control of the Commission, have general supervision, direction and control of the business and officers of the Authority. He shall preside at all meetings of the Commission. He shall be ex officio member of all standing committees, and shall have the general powers and duties of management usually vested in the office of Chairman of a public corporation and shall have such other powers and duties as may be prescribed by the Commission or by these Rules and Regulations. Section 3.6. Vice Chairman, In the absence or disability of the Chairman, the Vice Chairman shall perform all the duties of the Chairman and when so acting shall have all the powers of and be subject to all of the restrictions upon the Chairman. The Vice Chairman shall have such other powers and perform such other duties as may from time to time be prescribed for them, respectively, by the Commission or by these Rules and Regulations. Section 3.7. 3ecretarv, The Secretary shall keep or cause to be kept a book of minutes at the principal office or at such other place as the Commission may order, of all meetings of the Commissioners, with the time and place of holding, whether regular or special, and if special, how authorized, the notice thereof given, the names of those present at Commissioners' meetings and the proceedings thereof. The Secretary shall give or cause to be given notice of all meetings of the Commission of the Authority, shall keep the corporate records in safe custody and shall have such other powers and perform such other duties as may be prescribed by the Commission or these Rules and Regulations. ARTICLE IV OBJECTS AND PURPOSES Section 4.1. Nature of Objects and Purposes, The business of this Authority is to be operated and conducted in the promotion of its objects and purposes as set forth in the Agreement. Section 4.2. Distribution of Assets During Continuance of Authority, During the continuance of the Authority, it may distribute any of its assets to the Members of the Authority. If for any reason the Members are unable or unwilling to accept the assets of the Authority, said assets shall be distributed to the Federal Government, or to a state or local government for public purposes, or to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable purposes. Section 4.3. Dissolution. The Authority may, with the approval of all of the Members, be dissolved if at the time of such dissolution the Authority has no outstanding indebtedness and is not a party to any outstanding material contracts. Upon the dissolution or termination of this Authority, and after payment or provision for payment, all debts and liabilities, the assets of this Authority shall be distributed to the Members of the Authority. If for any reason the Members are unable or unwilling to accept the assets of the Authority, said assets will be distributed to the Federal Government or to a state or local government for public purposes; or to a nonprofit fund, foundation, or corporation which is organized and operated for charitable purposes. ARTICLE V GENERAL PROVISIONS Section 5.1. Payment of Money. Signatures, All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness issued in the name of or payable to the Authority and any and all securities owned by or held by the Authority requiring signature for transfer shall be signed or endorsed by the Auditor and Treasurer. -4- Section 5.2. Execution of Contracts, The Commission, except as in the Agreement or in the Rules and Regulations otherwise provided, may authorize any officer or officers, agent or agents, to enter into any contract or execute any contract or execute any instrument in the name of and on behalf of the Authority and such authority may be general or confined to specific instances and unless so authorized by the Commission, no officer, agent or employee shall have any power or authority to bind the Authority by any contract or engagement or to pledge its credit or to render it liable for any purpose or in any amount. Section 5.3. Construction of Public Capital Improvements, The Commission shall cause Public Capital Improvements to be acquired and constructed pursuant to contracts awarded competitively or on a negotiated basis, whichever the Commission detei,uines is in the best interests of the Authority, its Members, or other local public agencies, which determination shall be final and incontestable. Section 5.4. Fiscal Year, The fiscal year of the Authority shall commence on the 1st day of July of each year and shall end on the 30th day of June of the next succeeding year. Section 5.5. Amendment of Rules and Reauulations, These Rules and Regulations may be amended at any time and from time to time by majority vote of the Commission. ************************ I HEREBY CERTIFY that the above and foregoing is f 1, true and correct copy of a document of the National City Joint Powers Financing . th rity, passed and adopted by the Authority. Secr National City Joint Powers Financing Authority $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. OFFICER'S CERTIFICATE OF THE AUTHORITY The undersigned hereby states and certifies: (i) that the undersigned is the duly elected or appointed, qualified and acting Chairman of the National City Joint Powers Financing Authority, a joint exercise of powers agency duly organized and existing under the Constitution and the laws of the State of California (the "Authority"), and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same; (ii) that the undersigned is an "Authorized Issuer Representative" of the Authority, as such term is defined in that certain Trust Indenture, dated as of October 1, 1998, by and between the Authority and Union Bank, N.A., as successor in interest to Union Bank of California, N.A., as trustee (the "Trustee"); (iii) that the following are now, and have continuously been since the dates of the beginning of their respective current terms of office shown below, the duly appointed, qualified and acting members of the Commission of the Authority, and the dates of the beginning and ending of their respective terms of office are correctly designated opposite their names: Beginning Date Ending Date Member of Current Term of Current Term Ron Morrison December 2006 December 2010 Alejandra Sotelo-Solis December 2008 December 2012 Jess E. Van Deventer January 2009 December 2010 Rosalie G. Zarate December 2008 December 2012 (iv) that the signatures set forth opposite the names and titles of the following persons are the true and correct specimen, or are the genuine, signatures of such persons, each of whom holds the office designated: Name and Title Ron Morrison, Chairman Chris Zapata, Secretary Signature 13145742.3 (v) that, on September 21, 2010, the Commission of the Authority duly adopted Resolution No. 2010-2 entitled " RESOLUTION OF THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY (1) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, THE CITY OF NATIONAL CITY, AND UNION BANK OF CALIFORNIA; (2) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; AND, (3) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11 S" (the "Authority Resolution"), which Authority Resolution has not been amended, modified, supplemented, rescinded or repealed and remains in full force and effect as of the date hereof; (vi) that, by all necessary action, the Authority has duly authorized and approved (a) the refinancing of the Authority's Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project) (the "Bonds") and the related lease payments to be made by the City of National City (the "City') under that certain Amended and Restated Lease Agreement, dated as of October 1, 1998, between the Authority and the City, and (b) the execution and delivery of, and the performance by the Authority of the obligations on its part contained in, the following documents (collectively, the "Authority Documents"): 1. Termination Agreement, dated as of September 1, 2010, among the Authority, the City, and the Trustee; 2. Lease Agreement, dated as of September 1, 2010, between the Authority, as lessor, and the City, as lessee; 3. Assignment Agreement, dated as of September 1, 2010, between the Authority, as assignor, and Bank of America, N.A, as assignee; and 4. Irrevocable Refunding Instructions, dated as of September 28, 2010, executed by the City and accepted by the Authority. (vii) that the representations and warranties of the Authority contained in the Authority Documents are true, complete and correct on and as of the date hereof as if made on the date hereof; (viii) that the Authority has complied with all of the terms and conditions of the Authority Documents and has satisfied the conditions on its part to be performed or satisfied under the Authority Resolution at or prior to the date hereof; (ix) that the employer identification number of the Authority, for federal tax purposes is 33-0485864; and (x) that, for the calendar year 2010 and including the Information Return for Tax - Exempt Governmental Obligations Form 8038-G, filed with the Internal Revenue services with respect to the Bonds, the Authority has filed one (1) Information Return Form 8038-G with the Internal Revenue Service Center, Philadelphia, Pennsylvania 19255. 13145742.3 2 WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. NATIONAL CITY JOINT POWERS FINANCING AUTHORITY By: on Morrison Chairman 13145742 [Officer's Certificate of the Authority] Form 8038.G (Rev. May Department Internal Revenue �+ 2010) of the Treasury Service Information Return for Tax -Exempt Governmental Obligations ► Under Internal Revenue Code section 149(e) ► See separate instructions. Caution: If the issue price is under $100,000, use Form 8038-GC. OMB No. 1545-0720 Part I Reporting Authority If Amended Return, check here D. ■ I Issuer's name 2 Issuers employer Identification number (fill National City Joint Powers Financing Authority 33 0485864 3 Number and street (or P.O. box if mail is not delivered to street address) Room/suite 4 Report number (For IRS Use Only) 1243 National City Blvd. 13 I 1' 5 City, town, or post office, state, and ZIP code 6 Date of issue National City, CA 91950 September 28, 2010 7 Name of issue $3,115,000 City of National City and National City Joint Powers Financing 8 CUSIP number Authority Lease Financing with Bank of America, N.A. None 9 Name and title of officer of the issuer or other person whom the IRS may call for more information 10 Telephone number of officer or other person Jeanette Ladrido, Director of Finance ( 619 ) 336.4331 Part II Type of Issue (enter the issue price) See instructions and attach schedule 11 Education 12 Health and hospital 13 Transportation 14 Public safety 15 Environment (including sewage bonds) 16 Housing 17 Utilities 18 Other. Describe ► Police Facilities 19 If obligations are TANs or RANs, check only box 19a ► ❑ If obligations are BANs, check only box 19b ► ❑ 20 If obligations are in the form of a lease or installment sale, check box ► ❑ Part III 11 12 13 14 15 16 17 18 3,115,000 00 Description of Obligations. Complete for the entire issue for which this form is being filed. 21 (a) Final maturity date (b) Issue price (c) Stated redemption price at maturity (d) Weighted average maturity (e) Yield 10/01/2017 $ 3,115,000.00 $ 3,115,000.00 4.143 years 2.999 % Part IV Uses of Proceeds of Bond Issue (inc udinq underwriters' discount 22 Proceeds used for accrued interest 23 Issue price of entire issue (enter amount from line 21, column (b)) 22 23 3,115,000 00 24 Proceeds used for bond issuance costs (including underwriters' discount) 24 42,920 09 si 25 Proceeds used for credit enhancement 25 26 Proceeds allocated to reasonably required reserve or replacement fund 28 27 Proceeds used to currently refund prior issues 27 3,072,079 91 'f= 28 Proceeds used to advance refund prior issues 28 e , 29 Total (add lines 24 through 28) 29 3,115,000 00 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) . . 30 0 00 Part V Description of Refunded Bonds (Complete this part only for refunding bonds. 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . 32 Enter the remaining weighted average maturity of the bonds to be advance refunded . ► 33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) 34 Enter the date(s) the refunded bonds were issued ► IMM/DD/yYYY) 10/27/1998 ► 0 ► 10/01/2010 years years For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 637735 Form 8038-G (Rev. 5-2010) Form 8038-G (Rev. 5-2010) Page 2 Part VI Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIC) (see instructions) b Enter the final maturity date of the GIC ► 37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units b If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► ❑ and enter the name of the issuer ► and the date of the issue P. 38 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box ► ❑ 39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box ► ❑ 40 If the issuer has identified a hedge, check box ► ❑ 35 36a 37a Signature and Consent Under penalties of perjury, I fare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge an• 'el, they are true, c ct and complete. I further declare that I consent to the IRS's disclosure of the issuer's return information, as necessary to s this ret n, t person that I have authorized above. 41211d Signature of issuer uthorized representative Date Paid Preparer's Use Only Preparers signature Jeanette Ladrido, Finance Director Type or print name and title Firm's name (or yours if self-employed), address, and ZIP code Nixon Peab.F LLP Preparer's SSN or PTIN Check if self-employed ❑ P01084965 EN 16 0764720 555 W. 5th Street, 46th Floor, LA, CA 90013 Phone no. (213) 629-6000 Form 8038-G (Rev. 5-2010) Mayor Ron Morrison Councilrnembers: Alejandra Sotelo-Solis Jess VanDeventer Rosalie Zarate City Manager Chris Zapata Department of Finance Finance Director Jeanette Ladrido, CPA Financial Services Officer Tess Limfueco REVISED CONDITIONAL NOTICE OF FULL REDEMPTION NATIONIAL CITY JOINT POWERS FINANCING AUTHORITY LEASE REVENUE REFUNDING BONDS SERIES 1998 (POLICE FACILITIES PROJECT) NOTICE IS HEREBY GIVEN that on October 1, 2010 (the "Redemption Date"), the above -captioned bonds (the "Bonds") have been called for redemption pursuant to Section 3.01 of the Indenture of Trust, dated as of October 1, 1998, by and between Union Bank of California, N.A., presently know as Union Bank, N.A., as Trustee (the "Trustee") and National City Joint Powers Financing Authority (the "Authority"). The Bonds will be redeemed at 100% of the principal amount, without premium, plus accrued interest (the "Redemption Price"). Interest will be paid in the usual manner. Such redemption of the Bonds is conditional upon the receipt by the Trustee, on or prior to October 1, 2010, of moneys sufficient to pay the Redemption Price of the Bonds to be redeemed, and if such moneys shall not have been so received, this notice shall be of no force and effect and the Authority shall not be required to redeem the Bonds. The Bond CUSIP numbers and maturity dates are listed below: CUSIP Number Principal Amount Maturity Date 63540PAL3 $3,280,000.00 10/01/2017 The Bonds are due and payable at the office of the Trustee on Redemption Date. Interest will cease to accrue on the Bonds from and after the Redemption Date. The Bonds should be presented for redemption to the office of the Trustee at the following address: Union Bank, N.A. Corporate Trust Department 120 S. San Pedro Street, 4th Floor Los Angeles, CA 90012 Attn: Bond Redemption To avoid a 28% back-up withholding tax required by Federal law, holders of Bonds must submit with their Bonds a completed IRS Form W-9. For your convenience a Form W-9 has been enclosed. The CUSIP number has been assigned by Standard & Poor's Corporation and is included solely for the convenience of the holders of Bonds. Neither the Authority nor the Trustee shall be responsible for the selection or use of the CUSIP numbers nor is any representation made as to their correctness on the Bonds or as indicated in any redemption Notice. Dated: August 31, 2010 Union Bank, N.A., as Trustee for NATIONAL CITY JOINT POWERS FINANCING AUTHORITY 1243 National City Boulevard; National City, California 91950 Tel.: (619) 336.4330 Fax: (619) 336,4349 $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. OFFICER'S CERTIFICATE OF THE CITY The undersigned hereby states and certifies: (i) that the undersigned is the duly appointed, qualified and acting Director of Finance of the City of National City (the "City"), a general law city duly organized and existing under the laws of the State of California, and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same; (ii) that the undersigned is an "Authorized City Representative" of the City, as such term is defined in that certain Trust Indenture, dated as of October 1, 1998, by and between the National city Joint Powers Financing Authority and Union Bank, N.A., as successor in interest to Union Bank of California, N.A., as trustee (the "Trustee"); (iii) that the following are now, and have continuously been since the dates of the beginning of their respective current terms of office shown below, the duly appointed, qualified and acting members of the City Council, and the dates of the beginning and ending of their respective terms of office are correctly designated opposite their names: Beginning Date Ending Date Member of Current Term of Current Term Ron Morrison December 2006 December 2010 Alejandra Sotelo-Solis December 2008 December 2012 Jess Van Deventer December 2009 December 2010 Rosalie Zarate December 2008 December 2012 (iv) that the signatures set forth opposite the names and titles of the following persons are the true and correct specimen, or are the genuine, signatures of such persons, each of whom holds the office designated: Name and Title Ron Morrison, Mayor Chris Zapata, City Manager 13145742.3 Name and Title Signature Jeanette Ladrido, Director of Finance Michael R. Dalla, City Clerk (v) that, on September 21, 2010, the City Council duly adopted Resolution No. 2010- 217 entitled "RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY (1) AUTHORIZING PROCEEDINGS TO REFINANCE $3,280,000 OUTSTANDING 1998 LEASE REVENUE BONDS; (2) TERMINATING THE 1998 LEASE AGREEMENT BETWEEN THE CITY, THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY, AND UNION BANK OF CALIFORNIA; (3) APPROVING THE NEW LEASE AGREEMENT BETWEEN THE CITY AND THE NATIONAL CITY JOINT POWERS FINANCING AUTHORITY; (4) APPROVING THE ASSIGNMENT AGREEMENT BETWEEN THE AUTHORITY AND THE LENDER; AND (5) APPROVING THE IRREVOCABLE REFUNDING INSTRUCTIONS GIVEN BY THE CITY TO THE 1998 TRUSTEE. WITH THIS REFINANCE, THE GENERAL FUND WILL REALIZE A DIRECT SAVINGS OF $137,000 IN FY 10-11" (the "City Resolution"), which City Resolution has not been amended, modified, supplemented, rescinded or repealed and remains in full force and effect as of the date hereof; (vi) that, by all necessary action, the City has duly authorized and approved (a) the refinancing of the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project) (the "Bonds") and the related the lease payments to be made by the City under that certain Amended and Restated Lease Agreement, dated as of October 1, 1998, between the National City Joint Powers Financing Authority (the "Authority") and the City, (b) the execution and delivery of, and the performance by the City of the obligations on its part contained in, the following agreements (collectively, the "City Documents"): 1. Termination Agreement, dated as of September 1, 2010, among the Authority, the City, and the Trustee; 2. Lease Agreement, dated as of September 1, 2010, between the Authority, as lessor, and the City, as lessee; and 3. Irrevocable Refunding Instructions, dated as of September 28, 2010, executed by the City and accepted by the Authority. (vii) that the representations and warranties of the City contained in the City Documents are true, complete and correct on and as of the date hereof as if made on the date hereof; and (viii) that the City has complied with all of the terms and conditions of the City 13145742.3 2 Documents and has satisfied the conditions on its part to be performed or satisfied under the City Resolution at or prior to the date hereof. [Signature Page Follows] 13145742.3 3 WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. CITY OF NATIONAL CITY By: Jegnette Ladrido Director of Finance 13145742 [Officer's Certificate of the City] IRREVOCABLE REFUNDING INSTRUCTIONS (1998 Refunding Certificates of Participation) These IRREVOCABLE REFUNDING INSTRUCTIONS (these "Instructions") are dated as of September 28, 2010, and are given by the CITY OF NATIONAL CITY, a general law city and municipal corporation organized and existing under the Constitution and laws of the State of California (the "City"), to UNION BANK, N.A., a national banking association organized and existing under the laws of the United States of America, acting as trustee for the 1998 Bonds described below (the "1998 Trustee"). BACKGROUND: 1. The City has previously caused the issuance and delivery of the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project) in the aggregate original principal amount of $6,255,000 of which $3,280,000 is currently outstanding (the "1998 Bonds") under a Trust Indenture, dated as of October 1, 1998 (the "1998 Trust Indenture"), among the City, National City Joint Powers Financing Authority (the "Authority") and Union Bank, N.A., as trustee, evidencing lease payments payable by the City under an Amended and Restated Lease Agreement, dated as of October 1, 1998 (the "1998 Lease"), between the Authority as lessor and the City as lessee. 2. The 1998 Bonds are subject to prepayment in full on October 1, 2010, and in order to provide funds for that purpose the City and the Authority have entered into a Lease Agreement dated as of September 1, 2010 (the "Lease"), and the Authority has assigned its right to receive lease payments payable by the City thereunder to Bank of America, N.A. (the "Assignee") under an Assignment Agreement dated as of September 1, 2010 (the "Assignment Agreement"). 3. At the written direction of the City, the 1998 Trustee has, on September 1, 2010, provided the owners of the 1998 Bonds with a notice of prepayment, meeting the requirements of the 1998 Trust Indenture. 5. The City is giving these Instructions to the 1998 Trustee for the purpose of providing for the payment in full of the principal and interest represented by the 1998 Bonds upon the prepayment thereof on October 1, 2010. 13137475.4 INSTRUCTIONS: In order to provide for the payment and prepayment of the 1998 Bonds and to discharge the 1998 Bonds and the obligations represented thereby, the City hereby irrevocably directs the 1998 Trustee as follows: SECTION 1. Deposit into Bond Fund. On September 28, 2010 (the "Closing Date"), the City shall cause to be transferred to the 1998 Trustee for deposit into the Bond Fund the amount of $3,357,079.91 in immediately available funds, to be derived as follows: (a) from amounts provided by the Assignee in the amount of $3,072,079.91 under the Assignment Agreement; and (b) from amounts provided by the City to the Trustee in the amount of $285,000. SECTION 2. Investment and Application of Amounts. The 1998 Trustee shall hold the moneys deposited in the Bond Fund under Section 2 in cash, uninvested. The 1998 Trustee shall apply all cash held in the Bond Fund to pay the principal and interest represented by the 1998 Bonds coming due and payable upon the payment and prepayment thereof on October 1, 2010, in the following amounts: Maturing Prepaid Total Payment Date Interest Principal Principal Payment October 1, 2010 $77,080 $345,000 $2,935,000 $3,357,080 Following payment and prepayment in full of all of the 1998 Bonds on October 1, 2010, the 1998 Trustee shall withdraw all amounts remaining on deposit in the Bond Fund, if any, and transfer such amounts to the City to be applied to pay the lease payments next coming due under the Lease. SECTION 3. Transfer of Funds. The 1998 Trustee shall make the transfers into the Bond Fund from the 1998 Lease Payment Fund and from amounts received by the City, as set forth in subsections (a) and (b) of Section 1, such transfers to be made on the Closing Date. All other amounts held by the 1998 Trustee in any of the funds and accounts established under the 1998 Trust Indenture shall be withdrawn therefrom and transferred to the City to be applied to pay the lease payments next coming due under the Lease. SECTION 4. Application of Certain Terms of 1998 Certificate Documents. All of the terms of the 1998 Trust Indenture relating to the payment and prepayment of principal and interest represented by the 1998 Bonds, and the protections, immunities and limitations from liability afforded the 1998 Trustee as trustee for the 1998 Bonds, are 13137475.4 incorporated in these Instructions as if set forth in full herein. These Instructions set forth all matters pertinent to the deposits contemplated hereunder, and no additional obligations of the 1998 Trustee shall be inferred from the terms of these Instructions or any other agreement. SECTION 5. Compensation to Trustee. The City shall pay the 1998 Trustee full compensation for its services under these Instructions, including out-of-pocket costs such as publication costs, prepayment expenses, legal fees and other costs and expenses relating hereto and, in addition, all fees, costs and expenses relating to the purchase, substitution or withdrawal of any securities after the date hereof. Under no circumstances shall amounts deposited in or credited to the Bond Fund be deemed to be available for said purposes. The 1998 Trustee has no lien upon or right of set off against the cash and securities at any time on deposit in the Bond Fund. SECTION 6. [RESERVED] [Remainder of Page Intentionally Left Blank] 13137475.4 -3- SECTION 7. Effect of These Instructions. As a result of the deposit and application of funds in accordance with these Instructions, the obligations of the City under the 1998 Lease shall be discharged under and with the effect set forth in Section 4.8 of the 1998 Lease, and the 1998 Bonds shall be discharged under and with the effect set forth in Article VII of the 1998 Trust Indenture. The deposit made with the 1998 Trustee hereunder constitutes a security deposit for the payment of the 1998 Lease Payments in accordance with the provisions of Section 4.9 of the 1998 Lease, and these Instructions constitute an escrow deposit and trust agreement under and within the meaning of Article VII of the 1998 Trust Indenture. Date: September 28, 2010 CITY OF NATIONAL CITY, CALIFORNIA, a California city and municipal poration By Apprj�-d as to Fo By Attest: By ACCEPTED: C UNION BANK, N.A., as 1998 Trustee By Authorized Officer Ron Morrison Mayor 13137475 SECTION 7. Eject of These Instructions. As a result of the deposit and application of funds in accordance with these Instructions, the obligations of the City under the 1998 Lease shall be discharged under and with the effect set forth in Section 4.8 of the 1998 Lease, and the 1998 Bonds shall be discharged under and with the effect set forth in Article VII of the 1998 Trust Indenture. The deposit made with the 1998 Trustee hereunder constitutes a security deposit for the payment of the 1998 Lease Payments in accordance with the provisions of Section 4.9 of the 1998 Lease, and these Instructions constitute an escrow deposit and trust agreement under and within the meaning of Article VII of the 1998 Trust Indenture, Date: September 28, 2010 Approved as to Form: By City Attorney Attest: By. City Clerk ACCEPTED: UNION RANK, N.A., as 1998 Trustee By Authorized Officer 13137475 CITY OF NATIONAL CITY, CALIFORNIA, a California city and municipal corporation By Ron Morrison Mayor 111 UnionBank CUSTODY AGREEMENT For Public Funds This agreement is made between the City of National City ("Client") and Union Bank, N.A. ("Bank"). TERMS AND CONDITIONS 1. APPOINTMENT AS AGENT Client hereby appoints Bank as agent to act as custodian of cash, securities, and other property ("Property") described on Schedule A, attached hereto, and other property which may be deposited by Client with Bank from time to time to be held in the account established by this Agreement ("Account") and Bank agrees to act as Client's agent for such property according to the terms and conditions of this Agreement. 2. HANDLING OF INCOME AND PRINCIPAL 2.1 Income. Bank shall collect the income, when paid on said Property, and hold it until invested or otherwise disposed of pursuant to Client's written instructions. 2.2 Principal. Bank shall collect principal of Property when paid on maturity, redemption, sale, or otherwise, and hold it until invested or otherwise disposed of pursuant to Client's written instructions. 2.3 Collection Obligations. Bank shall diligently collect income and principal of which the Bank has received actual notice in accordance with normal industry practices. However, Bank shall be under no obligation or duty to take any action to effect collection of any amount if the securities or other Property upon which such amount is payable is in default, or if payment is refused after due demand unless the Bank has been adequately indemnified by Client in advance. Bank, however, shall notify Client promptly of such default or refusal to pay. 2.4 Additions to and Withdrawals from Account. Bank shall make all additions and withdrawals of Property to and from this Account only upon receipt of and pursuant to written instructions from Client except for those withdrawals provided for in Section 4. Upon receipt of such order for each withdrawal, unless otherwise instructed in writing, Bank shall deliver the Property so withdrawn to Client or to Client's designee, upon an appropriate receipt. 3. INVESTMENT OF PROPERTY 3.1 Directions by Client. Client shall have sole responsibility for the investment, review, and management of all Property held in this Account. Bank shall make all purchases, sales, conversions, exchanges, investments and reinvestments of Property held in this Account only upon receipt of and pursuant to written instructions from Client. Bank shall have no duty or obligation to review, or make recommendations for, the investment and management of any Property held in this Account, including uninvested cash. 3.2 Handle Corporate Actions. Bank shall notify Client of the receipt of notices of redemptions, conversions, maturities, exchanges, calls, puts, subscription rights, and scrip certificates ("Corporate Actions"). Bank need not monitor financial publications for notices of Corporate Actions and shall not be obligated to take any action without waiting for Client's instruction. If a Corporate Action has a fixed expiration date, and Bank has not received written instructions regarding it from Client five business days prior to such date, Bank shall take such action as it deems appropriate in its sole discretion. © Union Bank, N.A. (2009-007) 1 of 6 3.3 Fractional Interests. Bank shall receive and retain all stock distributed by a corporation as a dividend, stock split, or otherwise. However, in connection therewith, if a fractional share is received, Bank shall sell such fractional share. 3.4 Use of Nominees. Bank shall have the right to hold all registered securities in the name of its nominee. 3.5 Use of Securities Depository. Bank may, in its discretion, deposit in a securities depository any securities, which, under applicable law, are eligible to be deposited. 4. PLEDGE OF SECURITIES Client shall inform Bank in writing in the event that Client has pledged any Property held in the Account as collateral ("Pledged Collateral") for any loan or advance ("Secured Obligation") made to Client by Union Bank, N.A., or by any other lender designated by Client ("Secured Party"). Client's notice to Bank shall precisely identify the Pledged Collateral and state the name, address, telephone number and telex number of the Secured Party and the appropriate officer, if any, to contact in connection with the Pledged Collateral, and Client shall provide evidence that a copy of such notice has been provided to the Secured Party. Client shall be responsible to Bank for keeping Bank informed of any changes to this information, and Bank shall be fully protected in relying on such notice until receipt of a notice providing additional or substituted information. Bank shall segregate and identify such Property in its records as pledged. Notwithstanding anything to the contrary contained in this Agreement, by providing the notice referred to above, Client acknowledges and agrees that the terms of this Custody Agreement are superseded by the terms of any pledge or security agreement covering the Pledged Collateral, and that Bank cannot release the Pledge Collateral without the prior written consent of the Secured Party. In the event that the Secured Party shall notify the Bank in writing of a default of such Secured Obligation, Bank shall follow, with no further obligation, the written instructions of the Secured Party regarding the Pledged Collateral and shall be fully protected in so doing. Any interest or principal payments due on the Secured Obligation may be charged to the Account upon written instruction from Client. 5. PROXIES AND CORPORATE LITERATURE 5.1 Proxies. Bank shall forward all proxies and accompanying material issued by any company whose securities are held in the Account to Client unless directed in writing not to do so. 5.2 Corporate Literature. Bank shall have no duty to forward or retain any other corporate material received by the Account unless required to do so by law. 5.3 Disclosure to Issuers of Securities. Unless Client directs Bank in writing to the contrary, Client agrees that Bank may disclose the name and address of the party with the authority to vote the proxies of the securities held in this Account as well as the number of shares held, to any issuer of said securities or its agents upon the written request of such issuer or agent in conformity with the provisions of the applicable law. 6. CONFIRMATIONS 6.1 Confirmations. Bank shall have no responsibility to send confirmations of security transactions occurring in this Account to Client; however, Client may request confirmations for security transactions at any time at no additional cost to Client, and such confirmations shall be sent to Client within the time prescribed by law. 6.2 Statements. Each month, Bank shall send Client a cash statement and an asset statement showing market values. The statements will show all income and principal transactions and cash, securities and other Property holdings. Client may approve or disapprove such statement within sixty (60) days of their receipt and, if no written objections are received within the sixty-day (60) period, such statements of the account shall be deemed approved. © Union Bank, N.A. (2009-007) 2 of 6 7. USE OF OTHER BANK SERVICES Client may direct Bank to utilize for this Account other services or facilities provided by Bank, its subsidiaries or affiliates. Such services shall include, but not be limited to (1) the purchase or sales of securities as principal to or from, or, (2) the placing of orders for the purchase, sale, exchange, investment or reinvestment of securities through any brokerage service conducted by, or (3) the placing of orders for the purchase or sale of units of any investment company managed or advised by Bank, UnionBanCal Corp., or their subsidiaries or affiliates. Client hereby acknowledges that Bank will receive additional fees for such services in accordance with Bank's standard fee schedules, which shall be delivered to Client from time to time. If Client or Manager uses UnionBanc Investments Services, or other brokerage affiliate of Custodian, for the purchase or sale of securities as principal to or from, or the placing of orders for the purchase, sale, exchange, investment or reinvestment of securities, Client authorizes and directs Custodian to accept the confirmation of security transactions received from UBIS as the instructions from Client or Manager contemplated by this Agreement and no further instructions to Custodian shall be required. 8. INSTRUCTIONS All instructions from Client shall be in writing, and shall continue in force until changed by subsequent instructions. Pending receipt of written authority, Bank may, in its absolute discretion at any time, accept oral, wired, or electronically transmitted instructions from Client provided Bank believes in good faith that the instructions are genuine. 9. COMPENSATION AND OTHER CHARGES 9.1 Compensation. Bank's annual fee as agent shall be based on the fee schedule provided to and acknowledged by Client. 9.2 Charging the Account. Bank is authorized to charge the Account for incidental expenses as well as for funds necessary for Bank to complete any purchase or expense, to make any directed disbursement or take any other action regarding the Account. Bank shall have no duty to make any purchases, exchanges, or disbursements or to incur any expenses, unless the funds necessary to cover the amount of the expense are available in the Account. 10. COST BASES AND DATES OF ACQUISITION Client agrees to furnish Bank with the income tax cost bases and dates of acquisition of all Property held in the Account to be carried on its records. If Client does not furnish such information for any such Property, Bank shall carry the Property at any such nominal value it determines, such value to be for bookkeeping purposes only. All statements and reporting of any matters requiring this information will use this nominal value. Bank shall have no duty to verify the accuracy of the cost bases and dates of acquisition furnished by Client. Property purchased in the Account shall be carried at cost. 11. LIMITED POWER OF ATTORNEY Bank is hereby granted a limited power of attorney by Client to execute on Client's behalf any declarations, endorsements, assignments, stock or bond powers, affidavits, certificates of ownership or other documents required (1) to effect the sale, transfer, or other disposition of Property held in the Account, (2) to obtain payment with respect to Property held in the Account, or (3) to take any other action required with respect to the Property held in the Account, and in the Bank's own name to guarantee as Client's signature so affixed. 12. INDEMNIFICATION As additional consideration for the Bank's acceptance of this Account and Agreement to act as "Agent," Client agrees to indemnify, and hold Bank, its officers, directors, employees and agents harmless from and against any and all losses, liabilities, demands, claims, and expenses, any attorney's fees and taxes (other than those based on Bank's net income) arising out of or in connection with this Agreement, or out of any actions of Client or Client's agents which are not © Union Bank, N.A. (2009-007) 3 of 6 caused by Bank's gross negligence or willful misconduct. This provision shall survive the termination of this Agreement and shall be binding upon each party's successors, assigns, heirs and personal representatives. 13. AMENDMENT AND TERMINATION OF AGREEMENT 13.1 Amendment. This Agreement may be amended only by a written agreement executed by both Bank and Client. 13.2 Termination. This Agreement may be terminated at any time by written notice from one party to the other. Such termination shall be effective immediately. In addition, this Account shall terminate upon notification to the Bank of Client's incapacity or Client's death. Upon termination, Bank shall have a reasonable amount of time to transfer the Property held in the Account in accordance with the written instructions of Client or the person or entity legally entitled to receive such property. Costs related to termination, including without limitation, costs for shipping securities and other Property held in the Account and costs of re -registering securities, generating reports and accounting for disposition of cash shall be charged to the Account. 14. ENTIRE AGREEMENT This Agreement and Addendum (not Applicable) constitutes the entire Agreement between the parties. All previous agreements, whether written or oral, between the Bank and Client, are hereby superseded, except any direction to Bank prohibiting it to disclose information to issuers of securities as provided in Section 5.3. 15. SINGULAR AND PLURAL If more than one person shall execute this Agreement, then where the context permits, singular pronouns shall be deemed to be plural personal pronouns. 16. GOVERNING LAW This agreement shall be governed by, and construed under, the laws of the State of California. 17. TAXATION OF ACCOUNT 17.1 W-9 Certification. Client agrees to provide a completed W-9 or W-8 certification, as appropriate, to Bank. 17.2 Client's Tax Identification Number is: 95-6000749 17.3 Client's responsibility for Filing Tax Returns and Paying Taxes. Client is responsible for filing any and all tax returns and for paying all taxes on Property and income held in this Account. 18. NOTICES 18.1 Mailing of Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed as having been duly given on the date of service, if served personally on the party to whom notice is to be given, or on the fifth day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid, and properly addressed as follows: Client: City of National City 1243 National City Blvd. National City, CA 91950 Attn: Finance Director © Union Bank, N.A. (2009-007) 4 of 6 Bank: Union Bank, N.A. 120 S. San Pedro Street, 4th Floor Los Angeles, CA 90012 Attention: Corporate Trust Department 18.2 Change of Address. Either party may change the address at which notice may be given by giving ten (10) days prior written notice of such change to the other party. 19. EFFECTIVE DATE This Agreement shall become effective upon the date of receipt by the Bank of the securities and other property described in the attached Schedule A. BY CLIENT: By: Name and Title: Jeanette Ladrido, CPA Director of Finance Date: September 27, 2010 By: 4,7s Name and Title: rfs Zapata City Manager Date: September 27, 2010 ACCEPTED: Union Bank, N.A. By: Name and Title: Date: © Union Bank, N.A. (2009-007) 5 of 6 1243 National City Blvd. National City, CA 91950 Attn: Finance Director Bank: Union Bank, N.A. 120 S. San Pedro Street, 4th Floor Los Angeles, CA 90012 Attention: Corporate Trust Department 18.2 Change of Address. Either party may change the address at which notice may be given by giving ten (10) days prior written notice of such change to the other party. 19. EFFECTIVE DATE This Agreement shall become effective upon the date of receipt by the Bank of the securities and other property described in the attached Schedule A. BY CLIENT: By: Name and Title: Date: By: Name and Title: Date: ACCEPTED: Union Bank, N.A. By: )/ ,.�!'� %• Name and Title: Nabeel Badawi, Assistant Vice President Date: September 28, 2010 © Union Bank, N.A. (2009-007) 5 of 6 SCHEDULE A Certificates of Deposit Commercial Paper Corporate Bonds Government Agency Issues Government Bonds Mutual Funds Blackrock T-Fund Institutional Money Market © Union Bank, N.A. (2009-007) 6 of 6 EVIDENCE OF PROPERTY INSURANCE' ISSUE osTz� o THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW. THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUIING INSURER(S) AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST. PRODUCER ALLIANT INSURANCE SERVICES, INC. P.O. BOX 6450 NEWPORT BEACH, CA 92658-6450 PH (949) 756-0271 / FAX (949) 756-2713 LICENSE NO.0C36861 CODE SUB -CODE COMPANY VARIOUS PER ATTACHED SCHEDULE 3 in5L ED PUBLIC ENTITY PROPERTY INSURANCE PROGRAM (PEPIP): CITY OF NATIONAL CITY LOAN NUMBER POUCY NUMBER SEE ATTACHED 1243 NATIONAL CITY BLVD. NATIONAL CITY, CA 91950 EFFECTIVE DATE (MMIDDM') 07/01/10 EXPIRATION DATE (MMIDO(Y) 07/01111 CONT. UNTIL TERMINATED IF CHECKED THIS REPLACES PRIOR EVIDENCE DATED: PROPERTY INFORMATIONIY,,. ...� .. ..., ...,., . ,;:. .,. , tit,R .,}: ..,,,,_.efiZ.k �.., ,. LOCATION! DESCRIPTION .. e. �,zT �: $3,200,000 LEASE REVENUE REFUNDING BONDS, SERIES 1998 (POLICE FACILITY PROJECT) POLICE FACILITY, 1200 NATIONAL CITY BLVD., NATIONAL CITY, CA 92050. BOND REVENUE PAYMENTS REFLECT 24 MONTHS. THIS CERTIFICATE CANCELS AND REPLACES CERTIFICATE ISSUED 06/30/10 TO CHANGE BOND AMOUNT AND CERTHOLDER FROM UNION BANK OF CALIFORNIA. COVERAGEINFOFIMATIONY9a< .: :, „, .: ,.. , e; .. dw, -,taw aka , r,;x COVERAGE I PERILS I FORMS AMOUNT OF INSURANCE DEDUCTIBLE LL RISK OF DIRECT PHYSICAL LOSS OR DAMAGE EXCLUDING EARTHQUAKE INCLUDING FLOOD AT SPECIFIED LOCATIONS PER SCHEDULE ON FILE WITH COMPANY. COVERAGE INCLUDES REAL AND PERSONAL PROPERTY, RENTAL INCOME INCLUDING BOND REVENUE REQUIREMENTS, BUSINESS INTERRUPTION, EXTRA EXPENSE AND ALL EXTENSIONS AND SUBLIMITS OF COVERAGE AS SHOWN ON MANUSCRIPT POLICY FORM. REPAIR OR REPLACEMENT COST VALUATION $1,000,000,000 LOSS LIMIT PER OCCURRENCE FLOOD 830,000,000 PER OCCURRENCE AND ANNUAL AGGREGATE BOILER & MACHINERY $100,000,000 SEE BELOW THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABO VE FOR THE POLICY PER IOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDI TION OF ANY CONTRACT OR OTHER DO CUMENT W ITH RESPECT TOW HICH THIS EVIDENCE OF PROPERTY INSURANCE MAY BE ISSU ED OR MAY PERTAIN, THE INSURANCE AFFORDE D BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. REMARK5IINCLUowe SPEEIA4.cONDmoNs1L ,. DEDUCTIBLES: VEHICLES: ALL RISK: $5,000 $5,000 COMPREHENSIVE AND COLLISION FLOOD: $250,000 FLOOD ZONES A & V OTHER: $100,000 ALL OTHER FLOOD ZONES $5,000 CONTRACTOR EQUIPMENT BOILER & MACHINERY: $10,000- HIGHER DED APPLY BASED ON SPECIFIC OBJECT/SIZE/PERIL 1 . CANCELLATIOIiw SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POUCY PROVISIONS. ADDITIONAL. INTEREST/:. NAME AND ADDRESS ' NATURE OF INTEREST MORTGAGEE ADDITIONAL INSURED BANK OF AMERICA, N.A. MAIL CODE GA3-003-04-01 2059 NORTHLAKE PKWY. X LOSS PAYEE 4388FU (OTHER) TUCKER, GA 30084-5321 SIGNATURE OF 0 AGENT F COMPANY ' ISSUE DATE (MM/DO/YY) CERTIFICATE: OF INSURANCE 09/21/10 PRODUCER ALLIANT INSURANCE SERVICES, INC. P.O. Box 6450 Newport Beach, CA 92658-6450 Ph (949) 756-0271 / Fax (949) 756-2713 License No. 0C36861 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. COMPANIES AFFORDING COVERAGE INSURED SAN DIEGO POOLED INSURANCE PROGRAM AUTHORITY AND MEMBER CITY OF NATIONAL CITY NATIONAL CITY BLVD. NATIONAL CITY, CA 91950 COMPANY LETTER A INS. CO OF THE STATE OF PA C°R MPB LETTE1243 COMPANY LETTER C COMPANY D LETTER COMPANY E LETTER COVERAGES .. I.i f Y6l f q THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO AU. THE TERMS, EXCLUSION AND CONDITIONS OF SUCH POUCIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. CO LTR TYPE OF INSURANCE POLICY NUMBER POUCY EFFECTIVE DATE IMMIDO/YY) POUCY EXPIRATION DATE (MMIDD/YY) LIMITS GENERAL LIABILITY COMMERCIAL GENERAL LIABILITY r GENERAL AGGREGATE PRODUCTS-COMP/OP AGG. .a iy CLAIMS OCCUR MADE PERSONAL & ADV. INJURY OWNERS & CONTRACTOR'S MAT EACH OCCURRENCE FIRE DAMAGE (My on. In) MED. EXPENSE (My one person) AUTOMOBILE UABIUTY ANY AUTO ALL OWNED AUTOS SCHEDULED AUTOS HIRED AUTOS NON -OWNED AUTOS GARAGE LIABILITY COMBINED SINGLE LIMIT BODILY INJURY (Per parson) BODILY INJURY (Per accident) PROPERTY DAMAGE A EXCESS LIABILITY UMBRELLA FORM OTHER THAN UMBRELLA FORM sr 6907993 07/01/10 07/01/11 , EACH OCCURRENCE S1.000,000 _II AGGREGATE $1 000 000 X WORKER'S COMPENSATION AND EMPLOYER'S LIABILITY STATUTORY LIMITS EACH ACCIDENT DISEASE -POLICY LIMIT DISEASE -EACH EMPLOYEE OTHER DESCRIPTION OF OPERATIONSILOCATIONSNEHICLESISPECIAL ITEMS $3,200,000 LEASE REVENUE REFUNDING BONDS, SER ES 1998 (POLICE FACILITY PROJECT) POLICE FACILITY, 1200 NATIONAL CITY BLVD., NATIONAL CITY, CA 92050 THIS CERTIFICATE CANCELS AND REPLACES CERTIFICATE ISSUED 06/21/40 TO CHANGE BOND AMOUNT AND CERTHOLDER FROM UNION BANK OF CALIFORNIA. SUBJECT TOPOLICY TERMS. CONDITIONS AND EXCLUSIONS. CERTIFICATE HOLDEN;:. CANCELLATION),r:. BANK OF AMERICA, N.A. MAIL CODE GA3-003-04-01 2059 NORTHLAKE PKVVY. TUCKER, GA 30084-5321 . ISHOULD ANY OF THE ABOVE DESCRIBED POUCIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO MAIL a DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR . LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES AUTHORIZED REPRESENT - 1- _ /J I t} `/`�W�4lLt� a GUPUNITSANDPIPASD-LIAB-CER' SD-XS-PRI MEMORANDUM OF INSURANCE ISSUE DATE 9/21/2010 ALLIANT INSURANCE SERV CES, INC. P.O. BOX 6450 NEWPORT BEACH, CA 92658-6450 Ph (949) 756-0271 / Fax (949) 756-2713 License No. 0C36861 THIS MEMORANDUM IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE MEMORANDUM HOLDER. THIS MEMORANDUM DOES NOT AMEND, EXTEND, OR ALTER THE COVERAGE SHOWN BELOW. * INSURED SAN DIEGO POOLED INSURANCE COVERAGE AFFORDED BY PROGRAM AUTHORITY AND MEMBER AGENCY OF: LETTER A: INDIVIDUAL CITY'S SELF -INSURED RETENTION CITY OF NATIONAL CITY 1243 NATIONAL CITY BLVD. NATIONAL CITY, CA 91950 LETTER B: "San Diego Pooled Insurance Program Authority, A Public Agency." ' MEMBER AGENCY OF THE SAN DIEGO POOLED INSURANCE PROGRAM AUTHORITY COVERAGE PER CA. GOVERNMENT CODE SECTION 990.4(a), 990.8(c) THIS IS TO CERTIFY THAT A MEMORANDUM OF INSURANCE BELOW HAS BEEN ENTERED INTO BY INSURED NAMED ABOVE AS AUTHORIZED BY CALIFORNIA GOVERNMENT CODE SECTION 990.4(a) AND 990.8(c) FOR THE PERIOD INDICATED NOTWITHSTANDING ANY RE QUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS MEMORANDUM MAY BE ISSUED OR MAY PERTAIN. THE COVERAGE AFFORDED BY THE CONTRA CT DESCRIBED HERE IS SUBJ ECT TO ALL THE TERMS, EXCLUSIONS, AND CONDITIONS OF THE SUCH CONTRACT. MEMORANDUM MEMORANDUM MEMORANDUM LIABILITY LIMITS LTR TYPE OF COVERAGE NUMBER EFFECTIVE DATE EXPIRATION DATE EACH OCCURRENCE AGGREGATE A GENERAL AND AUTOMOBILE LIABILITY INCLUDING: ALL OWNED, HIRED AND SELF INSURED 07/01/10 07/01/11 BI & PD COMBINED 250,000 N/A NON -OWNED AUTOS PERSONAL INJURY INCL. B EXCESS LIABILITY" SDC 0025 07/01/10 07/01/11 BI & PD COMBINED 1,750,000 * * THE ABOVE NOTED MEMORANDUM OF INSURANCE IS A CLAIMS -MADE CONTRACT DESCRIPTION OF OPERATIONS I LOCATIONS / VEHICLES I SPECIAL ITEMS $3,200,000 LEASE REVENUE REFUNDING BONDS, SERIES 1998 (POLICE FACILITY PROJECT) POLICE FACILITY, 1200 NATIONAL CITY BLVD., NATIONAL CITY, CA 92050 THIS CERTIFICATE CANCELS AND REPLACES CERTIFICATE ISSUED 06/21/10 TO CHANGE BOND AMOUNT AND CERTHOLDER FROM UNION BANK OF CALIFORNIA. SUBJECT TO POLICY TERMS, CONDITIONS AND EXCLUSIONS. Al MEMORANDUM HOLDER CANCELLATION BANK OF AMERICA, N.A. SHOULD ANY OF THE ABOVE DESCRIBED CONTRACTS BE CANCELLED BEFORE THE EXPIRATION D ATE T HEREOF, THE AU THORITY W ILL ENDEAVOR T 0 M AIL 30 DAYS' WRITTEN NOT ICE T 0 T HE HOL DER NA MED HE REON B UT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE N 0 OBUGAT ION OR LIABILITY OF AN Y KIN D U PON T HE AUTHORITY, OR IT S REPRESENTATIVES. EX CEPT 10 D AYS FOR N ON -PAYMENT OF PREMIUM. MAIL CODE GA3-003-04-01 2059 NORTHLAKE PKWY. AUTHORIZED SIGNATURE TUCKER, GA 30084-5321 (.997:,..././04"-------- G:_Client FIIea\San Diego Pooled Insurance Program Authority(SANDPIPA)1SandpipatSd-Liabilily1Sd.Liebcer,_sd Pool Limb Cert-PnAoe Y ENDORSEMENT NO.10 This endorsement, effective 12:01 AM: July 1, 2010 Forms a part of policy no.: 6907993 Issued to: SAN DIEGO POOLED INSURANCE PROGRAM (SANDPIPA) By: THE INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA BLANKET ADDITIONAL INSURED ENDORSEMENT This Policy is hereby amended as follows: Item 1. of the Declarations is modified by the following: Any person or entity to whom the Named Insured is obligated by virtue of a contract to provide insurance solely as respect to Personal Injury and Property Damage such as afforded by this Policy, unless such contract is outside the normal course of the Insured's operations, said person or entity shall be covered only to the extent of such obligation of the Insured or of facilities used by the Insured. All other terms, definitions, conditions, and exclusions of this policy remain unchanged. Christooher G. Kooser Authorized Representative wr ww..wawrwlw..wa..ra A..Mwrw e.o.m.. • ..A I... IweA i ■ ■ ■ i ■ ■ ■ ■ ■ ■ ■ • ■ ■ ■ I 11 1 I I I I I 14 11 I I I I CLTA Standard Coverage Policy —1990 POLICY OF TITLE INSURANCE ISSUED BY stewart. .title guaranty company Order Number: 335516 1111.111 SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS AND STIPULATIONS, STEWART TITLE GUARANTY COMPANY, a Texas corporation, herein called the Company, insures, as of Date of Policy shown in Schedule A, against loss or damage, not exceeding the Amount of Insurance stated in Schedule A, sustained or incurred by the insured by reason of: 1. Title to the estate or interest described in Schedule A being vested other than as stated therein; 2. Any defect in or lien or encumbrance on the title; 3. Unmarketability of the title; 4. Lack of a right of access to and from the land; and in addition, as to an insured lender only: 5. The invalidity or unenforceability of the lien of the insured mortgage upon the title; 6. The priority of any lien or encumbrance over the lien of the insured mortgage; said mortgage being shown in Schedule B in the order of its priority; 7. The invalidity or unenforceability of any assignment of the insured mortgage, provided the assignment is shown in Schedule B, or the failure of the assignment shown in Schedule B to vest title to the insured mortgage in the named insured assignee free and clear of all liens. The Company will also pay the costs, attorneys' fees and expenses incurred in defense of the title or the lien of the insured mortgage, as insured, but only to the extent provided in the Conditions and Stipulations. In witness whereof, Stewart Title Guaranty Company has caused this policy to be signed and sealed by its duly authorized officers as of Date of Policy shown in Schedule A. Countersigned by: V Authorized Countersignature STEWART TITLE OF CALIFORNIA, INC. MO MOM Stewart title guaranty company Serial No. 0-2228-392508 Page 1 of 13 1, . . r 1111 Senior Chairman of the Board Chairman of the Board President pr. giv �: 1 ■ 1 I III 1 \I ►1 11 ►1 11 11 11 1 1 1 1 111 ►1 11 1I 11 11 11 11 CLTA Standard Coverage Policy —1990 Order Number: 335516 EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees are expenses which arise by reason of: 1. (a) Any law, ordinance or governmental regulations (including but not limited to building or zoning laws, ordinances, or regulations) restricting, regulating, prohibiting or relating to (i) the occupancy, use, or enjoyment of the land; (ii) the character, dimensions or location of any improvement now or hereafter erected on the land; (iii) a separation in ownership or a change in the dimensions or area of the land or any parcel of which the land is or was a part; or (iv) environmental protection, or the effect of any violation of these laws, ordinances or governmental regulations, except to the extent that a notice of the enforcement thereof or a notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. (b) Any governmental police power not excluded by (a) above, except to the extent that a notice of the exercise thereof or a notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. 2. Rights of eminent domain unless notice of the exercise thereof has been recorded in the public records at Date of Policy, but not excluding from coverage any taking which has occurred prior to Date of Policy which would be binding on the rights of a purchaser for value without knowledge. 3. Defects, liens, encumbrances, adverse claims or other matters: (a) whether or not recorded in the public records at Date of Policy, but created, suffered, assumed or agreed to by the insured claimant; (b) not known to the Company, not recorded in the public records at Date of Policy, but known to the insured claimant and not disclosed in writing to the Company by the insured claimant prior to the date the insured claimant became an insured under this policy; (c) resulting in no loss or damage to the insured claimant; (d) attaching or created subsequent to Date of Policy; or (e) resulting in loss or damage which would not have been sustained if the insured claimant had paid value for the insured mortgage or for the estate or interest insured by this policy. 4. Unenforceability of the lien of the insured mortgage because of the inability or failure of the insured at Date of Policy, or the inability or failure of any subsequent owner of the indebtedness, to comply with the applicable doing business laws of the state in which the land is situated. 5. Invalidity or unenforceability of the lien of the insured mortgage, or claim thereof, which arises out of the transaction evidenced by the insured mortgage and is based upon usury or any consumer credit protection or truth in lending law. 6. Any claim, which arises out of the transaction vesting in the insured the estate of interest insured by this policy or the transaction creating the interest of the insured lender, by reason of the operation of federal bankruptcy, state insolvency or similar creditors' rights laws. CONDITIONS AND STIPULATIONS I. Definition of Terms. The following terms when used in this policy mean: (a) "insured": the insured named in Schedule A, and, subject to any rights or defenses the Company would have had against the named insured, those who succeed to the interest of the named insured by operation of law as distinguished from purchase including, but not limited to, heirs, distributees, devisees, survivors, personal representatives, next of kin, or corporate or fiduciary successors. The term "insured" also includes: (i) the owner of the indebtedness secured by the insured mortgage and each successor in ownership of the indebtedness except a successor who is an obligor under the provisions of Section 12(c) of these Conditions and Stipulations (reserving, however, all rights and defenses as to any successor that the Company would have had against any predecessor insured, unless the successor acquired the indebtedness as a purchaser for value without knowledge of the asserted defect, lien, encumbrance, adverse claim or other matter insured against by this policy as affecting title to the estate or interest in the land); (ii) any governmental agency or governmental instrumentality which is an insurer or guarantor under an insurance contract or guaranty insuring or guaranteeing the indebtedness secured by the insured mortgage, or any part thereof, whether named as an insured herein or not; (iii) the parties designated in Section 2(a) of these Conditions and Stipulations. (b) "insured claimant": an insured claiming loss or damage. (c) "insured lender": the owner of an insured mortgage. (d) "insured mortgage": a mortgage shown in Schedule B, the owner of which is named as an insured in Schedule A. (e) "knowledge" or "known": actual knowledge, not constructive knowledge or notice which may be imputed to an insured by reason of the public records as defined in this policy or any other records which impart constructive notice of matters affecting the land. (f) "land": the land described or referred to in Schedule [A] [C], and improvements affixed thereto which by law constitute real property. The term "land" does not include any property beyond the lines of the area described or referred to in Schedule [A] [C], nor any right, title, interest, estate or easement in abutting streets, roads, avenues, alleys, lanes, ways or waterways, but nothing herein shall modify or limit the extent to which a right of access to and from the land is insured by this policy. (g) "mortgage": mortgage, deed of trust, trust deed, or other security instrument. (h) "public records": records established under state statutes at Date of Policy for the purpose of imparting constructive notice of matters relating to real property to purchasers for value and without knowledge. Serial No. 0-2228-392508 Page 2 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 (i) "unmarketability of the title": an alleged or apparent matter affecting the title to the land, not excluded or excepted from coverage, which would entitle a purchaser of the estate or interest described in Schedule A or the insured mortgage to be released from the obligation to purchase by virtue of a contractual condition requiring the delivery of marketable title. 2. Continuation of Insurance (a) After Acquisition of Title by Insured Lender. If this policy insures the owner of the indebtedness secured by the insured mortgage, the coverage of this policy shall continue in force as of Date of Policy in favor of (i) such insured lender who acquires all or any part of the estate or interest in the land by foreclosure, trustee's sale, conveyance in lieu of foreclosure, or other legal manner which discharges the lien of the insured mortgage; (ii) a transferee of the estate or interest so acquired from an insured corporation, provided the transferee is the parent or wholly -owned subsidiary of the insured corporation, and their corporate successors by operation of law and not by purchase, subject to any rights or defenses the Company may have against any predecessor insureds; and (iii) any governmental agency or governmental instrumentality which acquires all or any part of the estate or interest pursuant to a contract of insurance or guaranty insuring or guaranteeing the indebtedness secured by the insured mortgage. (b) After Conveyance of Title by an Insured. The coverage of this policy shall continue in force as of Date of Policy in favor of an insured only so long as the insured retains an estate or interest in the land, or holds an indebtedness secured by a purchase money mortgage given by a purchaser from the insured, or only so long as the insured shall have liability by reason of covenants of warranty made by the insured in any transfer or conveyance of the estate or interest. This policy shall not continue in force in favor of any purchaser from an insured of either (i) an estate or interest in the land, or (ii) an indebtedness secured by a purchase money mortgage given to an insured. (c) Amount of Insurance. The amount of insurance after the acquisition or after the conveyance by an insured lender shall in neither event exceed the least of (i) The amount of insurance stated in Schedule A; (ii) The amount of the principal of the indebtedness secured by the insured mortgage as of Date of Policy, interest thereon, expenses of foreclosure, amounts advanced pursuant to the insured mortgage to assure compliance with laws or to protect the lien of the insured mortgage prior to the time of acquisition of the estate or interest in the land and secured thereby and reasonable amounts expended to prevent deterioration of improvements, but reduced by the amount of all payments made; or (iii) The amount paid by an governmental agency or governmental instrumentality, if the agency or the instrumentality is the insured claimant, in the acquisition of the estate or interest in satisfaction of its insurance contract or guaranty. 3. Notice of Claim to be Given by Insured Claimant. An insured shall notify the Company promptly in writing (i) in case of any litigation as set forth in 4(a) below, (ii) in case knowledge shall come to an insured hereunder of any claim of title or interest which is adverse to the title to the estate or interest or the lien of the insured mortgage, as insured, and which might cause loss or damage for which the Company may be liable by virtue of this policy, or (iii) if title to the estate or interest or the lien of the insured mortgage, as insured, is rejected as unmarketable. If prompt notice shall not be given to the Company, then as to that insured all liability of the Company shall terminate with regard to the matter or matters for which prompt notice is required; provided, however, that failure to notify the Company shall in no case prejudice the rights of any insured under this policy unless the Company shall be prejudiced by the failure and then only to the extent of the prejudice. 4. Defense and Prosecution of Actions; Duty of Insured Claimant to Cooperate. (a) Upon written request by an insured and subject to the options contained in Section 6 of these Conditions and Stipulations, the Company, at its own cost and without unreasonable delay, shall provide for the defense of such insured in litigation in which any third party asserts a claim adverse to the title or interest as insured, but only as to those stated causes of action alleging a defect, lien or encumbrance or other matter insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of such insured to object for reasonable cause) to represent the insured as to those stated causes of action and shall not be liable for and will not pay the fees of any other counsel. The company will not pay any fees, costs or expenses incurred by an insured in the defense of those causes of action which allege matters not insured against by this policy. (b) The Company shall have the right, at its own cost, to institute and prosecute any action or proceeding or to do any other act which in its opinion may be necessary or desirable to establish the title to the estate or interest or the lien of the insured mortgage, as insured, or to prevent or reduce loss or damage to an insured. The Company may take any appropriate action under the terms of this policy, whether or not it shall be liable hereunder, and shall not thereby concede liability or waive any provision of this policy. If the Company shall exercise its rights under this paragraph, it shall do so diligently. (c) Whenever the Company shall have brought an action or interposed a defense as required or permitted by the provisions of this policy, the Company may pursue any litigation to final determination by a court of competent jurisdiction and expressly reserves the right, in its sole discretion, to appeal from any adverse judgment or order. (d) In all cases where this policy permits or requires the Company to prosecute or provide for the defense of any action or proceeding, an insured shall secure to the Company the right to so prosecute or provide defense in the action or proceeding, and all appeals therein, and permit the Company to use, at its option, the name of such insured for this purpose. Whenever requested by the Company, an insured, at the Company's expense, shall give the Company all reasonable aid (i) in any action or proceeding, securing evidence, obtaining witnesses, prosecuting or defending the action or proceeding, or effecting settlement, and (ii) in any other lawful act which in the opinion of the Company may be necessary or desirable to establish the title to the estate or interest or the lien of the insured mortgage, as insured. If the Company is prejudiced by the failure of an insured to furnish the required cooperation, the Company's obligations to such insured under the policy shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, with regard to the matter or matters requiring such cooperation. 5. Proof of Loss or Damage. In addition to and after the notices required under Section 3 of these Conditions and Stipulations have been provided the Company, a proof of loss or damage signed and sworn to by each insured claimant shall be furnished to the Company within 90 days after the insured claimant shall ascertain the facts giving rise to the loss or damage. The proof of loss or damage shall describe the defect in, or lien or encumbrance on the title, or other matter insured against by this policy which constitutes the basis of loss or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage. If the Company is prejudiced by the failure of an insured claimant to provide the required proof of loss or damage, the Company's obligations to such insured under the policy shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, with regard to the matter or matters requiring such proof of loss or damage. In addition, an insured claimant may reasonably be required to submit to examination under oath by any authorized representative of the Company and shall produce for examination, inspection and copying, at such reasonable times and places as may be designated by any authorized representative of the Company, all records, books, ledgers, checks, correspondence and memoranda, whether bearing a date before or after Date of Policy, which reasonably pertain to the loss or damage. Further, if requested by any authorized representative of the Company, the insured claimant shall grant its permission, in writing, for any authorized representative of the Company to examine, inspect and copy all records, books, ledgers, checks, correspondence and Serial No. 0-2228-392508 Page 3 of 13 CLTA Standard Coverage Policy — 1990 Order Number: 335516 memoranda in the custody or control of a third party, which reasonably pertain to the loss or damage. All information designated as confidential by an insured claimant provided to the Company pursuant to this Section shall not be disclosed to others unless, in the reasonable judgment of the Company, it is necessary in the administration of the claim. Failure of an insured claimant to submit for examination under oath, produce other reasonably requested information or grant permission to secure reasonably necessary information from third parties as required in this paragraph, unless prohibited by law or governmental regulation, shall terminate any liability of the Company under this policy as to that insured for that claim. 6. Options to Pay or Otherwise Settle Claims; Termination of Liability. In case of a claim under this policy, the Company shall have the following additional options: (a) To Pay or Tender Payment of the Amount of Insurance or to Purchase the Indebtedness. (i) to pay or tender payment of the amount of insurance under this policy together with any costs, attorneys' fees and expenses incurred by the insured claimant, which were authorized by the Company, up to the time of payment or tender of payment and which the Company is obligated to pay; or (ii) in case loss or damage is claimed under this policy by the owner of the indebtedness secured by the insured mortgage, to purchase the indebtedness secured by the insured mortgage for the amount owning thereon together with any costs, attorneys' fees and expenses incurred by the insured claimant which were authorized by the Company up to the time of purchase and which the Company is obligated to pay. If the Company offers to purchase the indebtedness as herein provided, the owner of the indebtedness shall transfer, assign, and convey the indebtedness and the insured mortgage, together with any collateral security, to the Company upon payment therefor. Upon the exercise by the Company of the option provided for in paragraph a(i), all liability and obligations to the insured under this policy, other than to make the payment required in that paragraph, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, and the policy shall be surrendered to the Company for cancellation. Upon the exercise by the Company of the option provided for in paragraph a(ii) the Company's obligation to an insured Lender under this policy for the claimed loss or damage, other than the payment required to be made, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation. (b) To Pay or Otherwise Settle with Parties Other than the Insured or With the Insured Claimant. (i) to pay or otherwise settle with other parties for or in the name of an insured claimant any claim insured against under this policy, together with any costs, attorneys' fees and expenses incurred by the insured claimant which were authorized by the Company up to the time of payment and which the Company is obligated to pay; or (ii) to pay or otherwise settle with the insured claimant the loss or damage provided for under this policy, together with any costs, attorneys' fees and expenses incurred by the insured claimant which were authorized by the Company up to the time of payment and which the Company is obligated to pay. Upon the exercise by the Company of either of the options provided for in paragraphs b(i) or b(ii), the Company's obligations to the insured under this policy for the claimed loss or damage, other than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation. 7. Determination and Extent of Liability. This policy is a contract of indemnity against actual monetary loss or damage sustained or incurred by the insured claimant who has suffered loss or damage by reason of matters insured against by this policy and only to the extent herein described. (a) The liability of the Company under this policy to an insured lender shall not exceed the least of: (i) the Amount of Insurance stated in Schedule A, or, if applicable, the amount of insurance as defined in Section 2 (c) of these Conditions and Stipulations; (ii) the amount of the unpaid principal indebtedness secured by the insured mortgage as limited or provided under Section 8 of these Conditions and Stipulations or as reduced under Section 9 of theses Conditions and Stipulations, at the time the loss or damage insured against by this policy occurs, together with interest thereon; or (iii) the difference between the value of the insured estate or interest as insured and the value of the insured estate or interest subject to the defect, lien or encumbrance insured against by this policy. (b) In the event the insured lender has acquired the estate or interest in the manner described in Section 2(a) of these Conditions and Stipulations or has conveyed the title, then the liability of the Company shall continue as set forth in Section 7(a) of these Conditions and Stipulations. (c) The liability of the Company under this policy to an insured owner of the estate or interest in the land described in Schedule A shall not exceed the least of: (i) the Amount of Insurance stated in Schedule A; or, (ii) the difference between the value of the insured estate or interest as insured and the value of the insured estate or interest subject to the defect, lien or encumbrance insured against by this policy. (d) The Company will pay only those costs, attorneys' fees and expenses incurred in accordance with Section 4 of these Conditions and Stipulations. 8. Limitation of Liability. (a) If the Company establishes the title, or removes the alleged defect, lien or encumbrance, or cures the lack of a right of access to or from the land, or cures the claim of unmarketability of title, or otherwise establishes the lien of the insured mortgage, all as insured, in a reasonably diligent manner by any method, including litigation and the completion of any appeals therefrom, it shall have fully performed its obligations with respect to that matter and shall not be liable for any loss or damage caused thereby. (b) In the event of any litigation, including litigation by the Company or with the Company's consent, the Company shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals therefrom, adverse to the title, or, if applicable, to the lien of the insured mortgage, as insured. (c) The Company shall not be liable for loss or damage to any insured for liability voluntarily assumed by the insured in settling any claim or suit without the prior written consent of the Company. (d) The Company shall not be liable to an insured lender for: (i) any indebtedness created subsequent to Date of Policy except for advances made to protect the lien of the insured mortgage and secured thereby and reasonable amounts expended to prevent deterioration of improvements; or (ii) construction loan advances made subsequent to Date of Policy, except construction loan advances made subsequent to Date of Policy for the purpose of financing in whole or in part the construction of an improvement to the land which at Date of Policy were secured by the insured mortgage and which the insured was and continued to be obligated to advance at and after Date of Policy. 9. Reduction of Insurance; Reduction or Termination of Liability. (a) All payments under this policy, except payments made for costs, attorneys' fees. and expenses, shall reduce the amount of insurance pro tanto. However, as to an insured lender, any payments made prior to the acquisition of title to the estate or interest as provided in Section 2(a) of these Serial No. 0-2228-392508 Page 4 of 13 CLTA Standard Coverage Policy — 1990 Order Number: 335516 Conditions and Stipulations shall not reduce pro tanto the amount of insurance afforded under this policy as to any such insured, except to the extent that the payments reduce the amount of the indebtedness secured by the insured mortgage. (b) Payment in part by any person of the principal of the indebtedness, or any other obligation secured by the insured mortgage, or any voluntary partial satisfaction or release of the insured mortgage, to the extent of the payment, satisfaction or release, shall reduce the amount of insurance pro tanto. The amount of insurance may thereafter be increased by accruing interest and advances made to protect the lien of the insured mortgage and secured thereby, with interest thereon, provided in no event shall the amount of insurance be greater than the Amount of Insurance stated in Schedule A. (c) Payment in full by any person or the voluntary satisfaction or release of the insured mortgage shall terminate all liability of the Company to an insured lender except as provided in Section 2(a) of these Conditions and Stipulations. 10. Liability Noncumulative. It is expressly understood that the amount of insurance under this policy shall be reduced by any amount the Company may pay under any policy insuring a mortgage to which exception is taken in Schedule B or to which the insured has agreed, assumed, or taken subject, or which is hereafter executed by an insured and which is a charge or lien on the estate or interest described or referred to in Schedule A, and the amount so paid shall be deemed a payment under this policy to the insured owner. The provisions of this Section shall not apply to an insured lender, unless such insured acquires title to said estate or interest in satisfaction of the indebtedness secured by an insured mortgage. 11. Payment of Loss. (a) No payment shall be made without producing this policy for endorsement of the payment unless the policy has been lost or destroyed, in which case proof of loss or destruction shall be furnished to the satisfaction of the Company. (b) When liability and the extent of loss or damage has been definitely fixed in accordance with these Conditions and Stipulations, the loss or damage shall be payable within 30 days thereafter. 12. Subrogation Upon Payment or Settlement. (a) The Company's Right of Subrogation Whenever the Company shall have settled and paid a claim under this policy, all right of subrogation shall vest in the Company unaffected by any act of the insured claimant. The Company shall be subrogated to and be entitled to all rights and remedies which the insured claimant would have had against any person or property in respect to the claim had this policy not been issued. If requested by the Company, the insured claimant shall transfer to the Company all rights and remedies against any person or property necessary in order to perfect this right of subrogation. The insured claimant shall permit the Company to sue, compromise or settle in the name of the insured claimant and to use the name of the insured claimant in any transaction or litigation involving these rights or remedies. If a payment on account of a claim does not fully cover the loss of the insured claimant, the Company shall be subrogated (i) as to an insured owner, to all rights and remedies in the proportion which the Company's payment bears to the whole amount of the loss; and (ii) as to an insured lender, to all rights and remedies of the insured claimant after the insured claimant shall have recovered its principal, interest, and costs of collection. If loss should result from any act of the insured claimant, as stated above, that act shall not void this policy, but the Company, in that event, shall be required to pay only that part of any losses insured against by this policy which shall exceed the amount, if any, lost to the Company by reason of the impairment by the insured claimant of the Company's right of subrogation. (b) The Insured's Rights and Limitations. Notwithstanding the foregoing, the owner of the indebtedness secured by an insured mortgage, provided the priority of the lien of the insured mortgage or its enforceability is not affected, may release or substitute the personal liability of any debtor or guarantor, or extend or otherwise modify the terms of payment, or release a portion of the estate or interest from the lien of the insured mortgage, or release any collateral security for the indebtedness. When the permitted acts of the insured claimant occur and the insured has knowledge of any claim of title or interest adverse to the title to the estate or interest or the priority or enforceability of the lien of an insured mortgage, as insured, the Company shall be required to pay only that part of any losses insured against by this policy which shall exceed the amount, if any, lost to the Company by reason of the impairment by the insured claimant of the Company's right of subrogation. (c) The Company's Rights Against Non-insured Obligors. The Company's right of subrogation against non-insured obligors shall exist and shall include, without limitation, the rights of the insured to indemnities, guaranties, other policies of insurance or bonds, notwithstanding any terms or conditions contained in those instruments which provide for subrogation rights by reason of this policy. The Company's right of subrogation shall not be avoided by acquisition of an insured mortgage by an obligor (except an obligor described in Section 1(a)(ii) of these Conditions and Stipulations) who acquires the insured mortgage as a result of an indemnity, guarantee, other policy of insurance, or bond and the obligor will not be an insured under this policy, notwithstanding Section 1(a)(i) of these Conditions and Stipulations. 13. Arbitration. Unless prohibited by applicable law, either the Company or the insured may demand arbitration pursuant to the Title Insurance Arbitration Rules of the American Arbitration Association. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the insured arising out of or relating to this policy, any service of the Company in connection with its issuance or the breach of a policy provision or other obligation. All arbitrable matters when the Amount of Insurance is $1,000,000 or less shall be arbitrated at the option of either the Company or the insured. All arbitrable matters when the Amount of Insurance is in excess of $1,000,000 shall be arbitrated only when agreed to by both the Company and the insured. Arbitration pursuant to this policy and under the Rules in effect on the date the demand for arbitration is made or, at the option of the insured, the Rules in effect at Date of Policy shall be binding upon the parties. The award may include attorneys' fees only if the laws of the state in which the land is located permit a court to award attorneys' fees to a prevailing party. Judgment upon the award rendered by the Arbitrator(s) may be entered in any court having jurisdiction thereof. The law of the sites of the land shall apply to an arbitration under the Title Insurance Arbitration Rules. A copy of the Rules may be obtained from the Company upon request. 14. Liability Limited to This Policy; Policy Entire Contract. (a) This policy together with all endorsements, if any, attached hereto by the Company is the entire policy and contract between the insured and the Company. In interpreting any provision of this policy, this policy shall be construed as a whole. (b) Any claim of loss or damage, whether or not based on negligence, and which arises out of the status of the lien of the insured mortgage or of the title to the estate or interest covered hereby or by any action asserting such claim, shall be restricted to this policy. Serial No. 0-2228-392508 ' Page 5 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 (c) No amendment of or endorsement to this policy can be made except by a writing endorsed hereon or attached hereto signed by either the President, a Vice President, the Secretary, an Assistant Secretary, or validating officer or authorized signatory of the Company. 15. Severability. In the event any provision of the policy is held invalid or unenforceable under applicable law, the policy shall be deemed not to include that provision and all other provisions shall remain in full force and effect. 16. Notices, Where Sent. All notices required to be given the Company and any statement in writing required to be furnished the Company shall include the number of this policy and shall be addressed to the Company at P.O. Box 2029, Houston, Texas 77252-2029, and identify this policy by its printed policy serial number which appears on the bottom of the front of the first page of this policy. STEWART TITLE GUARANTY COMPANY Serial No. 0-2228-392508 Page 6 of 13 CLTA Standard Coverage Policy —1990 SCHEDULE A Order No.: 335516 Amount of Insurance: $3,115,000.00 Date of Policy: September 28, 2010 at 8:00 AM 1. Name of Insured: Order Number: 335516 Prepared by: California Regional Production Center Title Officer: Frank Green Policy No.: 0-2228-392508 Premium: $5,396.00 the City of National City and Bank of America, N.A., a national banking association 2. The estate or interest in the land which is covered by this policy is: A leasehold estate as created by that certain lease for the term and upon and subject to all of the provisions contained in said document, and in said lease, dated September 1, 2010, executed by National City Joint Powers Financing Authority, a joint powers authority duly organized and existing under the Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, and the laws of the State of California (the "Authority"), as lessor, and City of National City, a city and municipal corporation duly organized and existing under the Constitution and laws of the State of California, as lessee, as referenced in the instrument recorded September 28. 2010 as Instrument/File No. 2010-0514247 of Official Records. 3. Title to the estate or interest in the land is vested in: City of National City 4. The land referred to in this policy is described as follows: (See Attached Legal Description) Serial No. 0-2228-392508 Page 7 of 13 CLTA Standard Coverage Policy —1990 LEGAL DESCRIPTION Order Number: 335516 The land referred to herein is situated in the State of California, County of San Diego, City of National City, and described as follows: PARCEL A: PARCEL(S) 1 AND 2 OF PARCEL MAP NO. 4027, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY AUGUST 21, 1975 AS FILE NO. 75-224074 OF OFFICIAL, RECORDS. PARCEL B: THE WEST 33-1/3 FEET OF LOTS 7 TO 10, INCLUSIVE, IN BLOCK 13 OF THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP NO. 348, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL C: THE WESTERLY 33 1/3 FEET OF THE EASTERLY 66 2/3 FEET OF LOTS 7 TO 10 INCLUSIVE IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL D: THE EASTERLY 33 1/3 FEET OF LOTS 7, 8, 9 AND 10 OF BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL E: THE SOUTHERLY 100 FEET OF LOT 11 AND THE SOUTHERLY 100 FEET OF THE WESTERLY EIGHT AND ONE-THIRD FEET OF LOT 12 EN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL F: LOTS 13 THROUGH 17 IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL G: Serial No. 0-2228-392508 Page 8 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 LOT 6, THE NORTH 25 PEST OF LOTS 11 AND 12 AND THE EAST 16 2/3 FEET OF SOUTH 100 FEET OF LOT 12, ALL IN BLOCK 13 OF NATIONAL CITY, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 348 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, OCTOBER 2, 1882. PARCEL H: A. PERMANENT EASEMENT AND RIGHT-OF-WAY TO CONSTRUCT, RECONSTRUCT, MAINTAIN, OPERATE AND REPAIR AN UNDERGROUND EMERGENCY GENERATOR FUEL TANK, DESCRIBED AS FOLLOWS: ALL THAT PORTION OF 12TH STREET, LYING NORTHERLY OF BLOCK 13 OF MAP NUMBER 348, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWESTERLY CORNER OF SAID BLOCK 13, BEING ALSO THE NORTHWESTERLY CORNER OF PARCEL 1 OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF PARCEL MAP NUMBER 4027; THENCE EASTERLY, ALONG THE NORTHERLY LINE OF SAID PARCEL 1, 75 FEET TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING EASTERLY ALONG SAID NORTHERLY LINE, SIGHT FEET; THENCE LEAVING SAID NORTHERLY LINE, AT RIGHT ANGLES, NORTH SIX FEET; THENCE WESTERLY, PARALLEL WITH THE NORTHERLY LINE OF SAID PARCEL 1, EIGHT FEET; THENCE AT RIGHT ANGLES, SOUTH, SIX FEET TO THE TRUE POINT OF BEGINNING, CONTAINING 48 SQUARE FEET. APN: 560-013-07; 560-013-08; 560-013-02; 560-013-03; 560-013-04; 560-013-05; 560-013-06; 560-013-09 (End of Legal Description) Serial No. 0-2228-392508 Page 9 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 SCHEDULE B PART I EXCEPTIONS FROM COVERAGE This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) which arise by reason of: 1. Taxes or assessments which are not shown as existing liens by the records of the taxing authority that levies taxes or assessments on real property or by the public records. Proceeding by a public agency which may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the public records. 2. Any facts, rights, interests or claims which are not shown by the public records but which could be ascertained by an inspection of the land or by making inquiry of persons in possession thereof. 3. Easements, liens or encumbrances, or claims thereof, which are not shown by the public records. 4. Discrepancies, conflicts in boundary lines, shortage in area, encroachments, or other facts which a correct survey would disclose, and which are not shown by the public records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b) or (c) are shown by the public records. Serial No. 0-2228-392508 Page 10 of 13 CLTA Standard Coverage Policy — 1990 SCHEDULE B PART II Order Number: 335516 A. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-07. Affects: A portion of the land described herein. B. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-08. Affects: A portion of the land described herein. C. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-02. Affects: A portion of the land described herein. D. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-03. Affects: A portion of the land described herein. E. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-04. Affects: A portion of the land described herein. F. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-05. Affects: A portion of the land described herein. G. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-06. Affects: A portion of the land described herein. Serial No. 0-2228-392508 Page 11 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 H. General and special city and/or county taxes, bonds or assessments which may become due on said land, if and when title to said land is no longer vested in a governmental or quasi -governmental agency. Tax parcel(s) for said land are currently shown as APN 560-013-09. Affects: A portion of the land described herein. I. Assessments, if any, for Community Facilities Districts or a Mello -Roos District affecting said land which may exist by virtue of assessment maps or notices filed by said districts. Said assessments are collected with the County Taxes. J. The lien of supplemental taxes, if any, assessed pursuant to the provisions of Chapter 3.5 (commencing with Section 75) of the Revenue and Taxation Code of the State of California. 1. Rights of the public in and to any portion of the property herein described lying within roads, streets or highways. 2. Easements and rights of way for road and public utilities and incidental purposes, over, under, along and across those easement parcels herein described, as conveyed and reserved by various deeds of record. 3. An easement for the purpose shown below and rights incidental thereto as set forth in a document: Grantee: Purpose: Recorded: Affects: 4. An easement for the Grantee: Purpose: Recorded: Affects: City of National City street purposes December 21, 1922 in Book 920, Page 150, of Deeds Parcel G purpose shown below and rights incidental thereto as set forth in a document: San Diego Gas and Electric Company transmission and distribution of electricity October 8, 1974, as Instrument No. 74-269956, Official Records the easterly 4.50 feet of the southerly 14.00 feet of said Lot 13 5. The effect of instruments declaring said land to be within the National City Downtown Redevelopment Project Redevelopment Plan, and that redevelopment proceedings have been instituted under Sections 33020 and 33071 of the California Community Redevelopment Law, recorded December 4, 1981 as instrument Nos. 81-381663, 81-381664 and 81-381665; December 9, 1981 as Instrument No. 81-386833 and recorded December 18, 1992 as File No. 1992-0812909, July 19, 1995 as File No. 1995-0306927 and recorded September 13, 2007 as File No. 2007-0602599, all of Official Records. Reference is hereby made to said documents for full particulars. 6. An easement for the purpose shown below and rights incidental thereto as set forth in a document: Grantee: The City of National City Purpose: the permanent right at any time, or from time to time, pursuant to any franchise or renewal thereof, for and on behalf of Cox Cable Company and Pacific Bell for maintenance of existing cable and telephone facilities Recorded: January 15, 1992, as Instrument No. 1992-0022228, Official Records Affects: said land Serial No. 0-2228-392508 Page 12 of 13 CLTA Standard Coverage Policy —1990 Order Number: 335516 Said easement is also described on Resolution No. 92-3 recorded January 15, 1992 as Instrument/File No. 1992-0022229 of Official Records. 7. An easement for the purpose shown below and rights incidental thereto as set forth in a document: Grantee: San Diego Gas & Electric Company Purpose: public utilities easement Recorded: June 18, 1992, as Instrument No. 1992-0378901, Official Records Affects: Parcel A The exact location of the easement is not disclosed by the instrument. 8. An easement for the purpose shown below and rights incidental thereto as set forth in a document: Grantee: San Diego Gas & Electric Company Purpose: meter access Recorded: June 18, 1992, as Instrument No. 1992-0378911, Official Records Affects: Parcel A The exact location of the easement is not disclosed by the instrument. 9. A Lease Agreement by and between the National City Joint Powers Financing Authority, a joint powers authority duly organized and existing under the Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, and the laws of the State of California (the "Authority"), as lessor, and City of National City, a city and municipal corporation duly organized and existing under the Constitution and laws of the State of California as lessee, on the terms and conditions contained therein. Dated as of September 1, 2010 and recorded September 28, 2010 as File No. 2010-0514247 of Official Records. 10. Matters contained in an instrument entitled "Assignment Agreement" by and between the National City Joint Powers Financing Authority, a joint powers authority duly organized and existing under the Joint Powers Agreement, dated as of April 16, 1991 by and between the City of National City and the Community Development Commission of the City of National City, and the laws of the State of California (the "Authority")and Bank of America, N.A., a national banking association organized and existing under the laws of the United States of America, upon the terms and conditions and covenants therein provided. Dated as of September 1, 2010 and recorded September 28, 2010 as File No. 2010-0514248 of Official Records. 11. Any failure to comply with the terms and conditions and provisions of the leases referred to herein. (End of Exceptions) lw October 19, 2010 Serial No. 0-2228-392508 Page 13 of 13 CLTA Form 112.2 (Revised 06-03-05) Bondholder, Joint Powers Transaction CLTA — Lender or Bondholder ENDORSEMENT ATTACHED TO POLICY No. 0-2228-392508 ISSUED BY Stewart® ...title guaranty company HEREIN CALLED THE COMPANY Order No.: 7034-335516 Fee: $0.00 Endorsement Number: E-2599-3821844 Paragraph 1 of the Conditions and Stipulations of this policy is hereby amended by deleting therefrom subparagraph (a) and substituting in lieu thereof the following: (a) "insured": the party or parties named as insured in Schedule A, together with each successor in ownership of any of the bonds referred to in Schedule A of this policy (reserving, however, all rights and defenses as to any such successor that the Company would have had against any predecessor insured, unless the successor acquired the bond or bonds as a purchaser for value without knowledge of the asserted defect, lien, encumbrance, adverse claim or other matter insured against by this policy as affecting title to the estate or interest referred to in Schedule A in the land). Paragraph 1 of the Conditions and Stipulations of this policy is further hereby amended by adding subparagraph (j) thereto to read as follows: (j) "bond" or "bonds": the bonds referred to in Schedule A of this policy. Paragraph 6 of the Conditions and Stipulations of said policy is hereby amended by deleting the printed text thereof and substituting in lieu thereof the following: 6. Options to Pay or Otherwise Settle Claims: Termination of Liability. In case of a claim under this policy, the Company shall have the following additional options: (a) To Pay or Tender Payment of the Amount of Insurance or to Purchase the Bonds. (i) to pay or tender payment of the Amount of Insurance under this policy together with any costs, attorneys' fees and expenses incurred by the insured claimant, which were authorized by the Company, up to the time CLTA Form 112.2 (Rev. 06-03-05) CLTA - Lender or Bondholder Page 1 of 3 of payment or tender of payment and which the Company is obligated to pay; or (ii) in case loss or damage is claimed under this policy by an insured owner or legal holder of any of the bonds referred to in Schedule A, to purchase such bond or bonds for the amount owing thereon together with any costs, attorneys' fees and expenses incurred by the insured claimant, which were authorized by the Company, up to the time of purchase and which the Company is obligated to pay. If the Company offers to purchase said bond or bonds as herein provided, such insured shall transfer, assign and deliver said bond or bonds, together with any collateral securing the same, to the Company upon payment therefor. Upon the exercise by the Company of the options provided for in paragraph a(i), all liability and obligations to the insured under this policy, other than to make the payment required in that paragraph, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation, and the policy shall be surrendered to the Company for cancellation. Upon the exercise by the Company of the option provided for in paragraph a(ii), the Company's obligation to an insured owner or legal holder of said bond or bonds for the claimed loss or damage, other than the payment required to be made, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation. (b) To Pay or Otherwise Settle With Parties Other than the Insured or With the Insured Claimant. (i) to pay or otherwise settle with other parties for or in the name of an insured claimant any claim insured against under this policy, together with any costs, attorneys' fees and expenses incurred by the insured claimant which were authorized by the Company up to the time of payment and which the Company is obligated to pay; or (ii) to pay or otherwise settle with the insured claimant the loss or damage provided for under this policy, together with any costs, attorneys' fees and expenses incurred by the insured claimant which were authorized by the Company up to the time of payment and which the Company is obligated to pay. Upon the exercise by the Company of either of the options provided for in paragraphs b(i) or (ii), the Company's obligations to the insured under this policy for the claimed loss or damage, other than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation. Any loss under this policy shall be payable to the insured as their respective interests may appear. If payment is made to any owner or legal holder of any of said bonds, such payment shall be made ratably with other bondholders. Payment by the Company to any owner or legal holder of any of said bonds CLTA Form 112.2 (Rev. 06-03-05) CLTA - Lender or Bondholder Page 2 of 3 shall reduce pro tanto the liability of the Company under this policy to such owner or legal holder. This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements. Dated: September 28, 2010 In witness whereof, Stewart Title Guaranty Company has caused this policy to be signed and sealed by its duly authorized officers as of Date of Policy shown in Schedule A. Countersigned by: Authorized Countersignature STEWART TITLE OF CALIFORNIA, INC. SteWart title guaranty company Senior Chairman of the Board Chairman of the Board frbe/40/21dio__ President CLTA Form 112.2 (Rev. 06-03-05) CLTA - Lender or Bondholder Page 3 of 3 CLTA Form 119.5 (01-17-04) (Leasehold, Owners) ALTA Endorsement Form 13 ALTA or CLTA — Owner ENDORSEMENT ATTACHED TO POLICY NO. 0-2228-392508 ISSUED BY stewart ►title guaranty company HEREIN CALLED THE COMPANY Order No.: 7034-335516 Fee: $0.00 Endorsement Number: E-2677-3764594 1. As used in this endorsement, the following terms shall mean: a. "Evicted" or "Eviction": (a) the lawful deprivation, in whole or in part, of the right of possession insured by this policy, contrary to the terms of the Lease or (b) the lawful prevention of the use of the land or the Tenant Leasehold Improvements for the purposes permitted by the Lease, in either case, as a result of a matter covered by this policy. b. "Lease": the lease agreement described in Schedule A. c. "Leasehold Estate": the right of possession for the Lease Term. d. "Lease Term": the duration of the Leasehold Estate, including any renewal or extended term if a valid option to renew or extend is contained in the Lease. e. "Personal Property": chattels located on the land and property which, because of their character and manner of affixation to the land, can be severed from the land without causing appreciable damage to themselves or to the land to which they are affixed. f. "Remaining Lease Term": the portion of the Lease Term remaining after the insured has been Evicted as a result of a matter covered by this policy. g. "Tenant Leasehold Improvements": Those improvements, including landscaping, required or permitted to be built on the land by the Lease that have been built at the insured's expense or in which the insured has an interest greater than the right to possession during the Lease Term. 2. The provisions of subsection (b) of Section 7 of the Conditions and Stipulations shall not apply to any Leasehold Estate covered by this policy. 3. Valuation of Estate or Interest Insured Page 1 of 3 ALTA FORM 119.5 (Leasehold, Owner) (01-17-04) If, in computing loss or damage, it becomes necessary to value the estates or interests of the insured as the result of a covered matter that results in an Eviction, then that value shall consist of the value for the Remaining Lease Term of the Leasehold Estate and any Tenant Leasehold Improvements existing on the date of the Eviction. The insured claimant shall have the right to have the Leasehold Estate and the Tenant Leasehold Improvements valued either as a whole or separately. In either event, this determination of value shall take into account rent no longer required to be paid for the Remaining Lease Term. 4. Additional items of loss covered by this endorsement: If the insured is Evicted, the following items of loss, if applicable, shall be included in computing loss or damage incurred by the insured, but not to the extent that the same are included in the valuation of the estates or interests insured by this policy. a. The reasonable cost of removing and relocating any Personal Property that the insured has the right to remove and relocate, situated on the land at the time of Eviction, the cost of transportation of that Personal Property for the initial one hundred miles incurred in connection with the relocation, and the reasonable cost of repairing the Personal Property damaged by reason of the removal and relocation. b. Rent or damages for use and occupancy of the land prior to the Eviction which the insured as owner of the Leasehold Estate is obligated to pay to any person having paramount title to that of the lessor in the Lease. c. The amount of rent that, by the terms of the Lease, the insured must continue to pay to the lessor after Eviction with respect to the portion of the Leasehold Estate and Tenant Leasehold Improvements from which the insured has been Evicted. d. The fair market value, at the time of the Eviction, of the estate or interest of the insured in any lease or sublease made by the insured as lessor of all or part of the Leasehold Estate or the Tenant Leasehold Improvements. e. Damages that the insured is obligated to pay to lessees or sublessees on account of the breach of any lease or sublease made by the insured as lessor of all or part of the Leasehold Estate or the Tenant Leasehold Improvements caused by the Eviction f. Reasonable costs incurred by the insured to secure a replacement leasehold equivalent to the Leasehold Estate. g. If Tenant Leasehold Improvements are not substantially completed at the time of Eviction, the actual cost incurred by the insured, less the salvage value, for the Tenant Leasehold Improvements up to the time of Eviction. Those costs include costs incurred to obtain land use, zoning, building and occupancy permits, architectural and engineering fees, construction management fees, costs of environmental testing and reviews, landscaping costs and fees, costs and interest on loans for the acquisition and construction. This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. ALTA FORM 119.5 (Leasehold, Owner) (01-17-04) Page 2 of 3 Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements. Dated: September 28, 2010 In witness whereof, Stewart Title Guaranty Company has caused this policy to be signed and sealed by its duly authorized officers as of Date of Policy shown in Schedule A. Countersigned by: stewart Authorized Countersignature STEWART TITLE OF CALIFORNIA, INC. title guaranty company Senior Chairman of tote Board Chairman of the Board ./)///e.44'a__ President Page 3 of 3 ALTA FORM 119.5 (Leasehold, Owner) (01-17-04) To: Union Bank, N.A. $3,115,900 City of National City and National City .Joint Powers Financing Authority Lease Financing with Rank of America, N.A. Requisition of the City of National City (Costs of Issuance Account) Request No.: COI-1 Amount to be paid: S=12.920.09 Name and address of party to whom payment is to be made: (See Exhibit A) Purpose for which the obligation was incurred: fSee Exhibit Al Dated: September 28, 2010 CITY OF NATIONAL CITY By: Jehnette Ladfido Director of Finance J ;3152094 I Item Number 1. 2. 3. 4. 5. 6. EXHIBIT A COSTS OF ISSUANCE Payee Name Urban Futures Southwest Securities Nixon Peabody LLP Union Bank, N.A. Stewart Title Miscellaneous Purpose of Obligation Financial Advisory Placement Agent Legal Counsel Trustee Title Insurance CDIAC fees and other costs Not to Exceed Amount $10,000.00 8,000.00 17,500.00 750.00 6,000.00 670.09 13152094.1 bUnionBank CERTIFICATE OF INCUMBENCY 1, Alison T. Braunstein, do hereby certify that I am the duly qualified and appointed Assistant Secretary of Union Bank, N.A. I further certify that the following is a true and correct specimen signature of said named employee and their signing authority as designated by the Institutional Services Executive Officer of Union Bank, N. A., and defined in the accompanying resolution. NAME TITLE CLASS Nabeel Badawi Assistant Vice President A, D, E SIGNATURE )/1,,07/ IN WITNESS WHEREOF, I have set my hand of this Association this 28th day of September, 2010. Corporate Trust Division 120 South San Pedro Street, 4th Floor Los Angeles, CA 90012 A member of MUFG, a global financial group Tel. 213 972 5660 Fax 213 972 5694 By: A ison T. Braunstein Assistant Secretary Union Bank, N.A. April 22, 2009 TRUST SERVICES RESOLUTION OF AUTHORITY WHEREAS, the Bank is duly authorized and empowered to act as trustee, executor, personal representative, administrator, guardian or conservator of estates, assignee, receiver, custodian, escrow agent, agent or in any other fiduciary capacity permitted by law (hereinafter referred to collectively as "Trust Services"); WHEREAS, it is the Board's intention to authorize and empower the officers/employees designated in this Resolution, in the Bank's name and on its behalf, at such times and under such circumstances and on such terms and conditions as such officers/employees may deem proper, under the Bank's seal, as necessary, to execute and deliver such documents and perform such acts as shall be necessary for the Bank to provide Trust Services; and WHEREAS, it is the Board's further intention to authorize and empower the Institutional Services Executive Officer and the Wealth Management Executive Officer as designated by the President and Chief Executive Officer or his/her designee to designate in writing the identity of and the manner in which such officers/employees may execute and deliver such documents and perform such actions. A. General Trust Services RESOLVED that any employee designated in writing as a Class A signer by the Institutional Services Executive Officer or the Wealth Management Executive Officer is authorized and empowered as hereinabove set forth to sign, execute and deliver: 1. Any instruments or other documents by which the Bank agrees or declines to or resigns from performing Trust Services and to execute such further instruments and documents and to perform any other act necessary to implement such acceptance, declination or resignation; 2. Any instruments or other documents and to perform any other act necessary to discharge its duties and obligations in performing Trust Services, including, but not limited to: a. Proxies to vote corporation stock or shares standing in the name of the Bank, as Fiduciary, or to attend and vote at any meeting such stock or shares; b. Any instruments, documents or agreements relating to insurance affecting any property, business or security held by the Bank, in its performance of Trust Services; c. Petitions, accountings, reports and returns of sale, and all other pleadings, declarations and documents filed in probate or other court proceedings by the Bank, in its performance of Trust Services; d. Checks against Trust funds, drafts and official checks issued by this Bank, the amount of which does not exceed the signing authority limit of the signer(s); e. Guaranties of signatures to various documents (other than assignments of stock certificates, bonds and other securities which are covered by separate authorization through the Securities Transfer Agents Medallion Program). No signer is authorized to guarantee the signer's own signature; f. Documents necessary to purchase, endorse, transfer, sell, assign, pledge, encumber, hypothecate, lease, release, convey, deliver or request payment or reissue of any and all certificates for shares of stock of corporations, bonds, stock warrants and rights, deposit receipts for stocks and bonds, promissory notes, warrants for irrigation and reclamation districts, debentures, voting trust certificates, money market instruments, commercial paper, repurchase agreements and banker's acceptances, investment agreements, and any and all other documents or instruments representing or evidencing any equity or debt interest in corporations, governmental entities or in personal property, standing in the name of or owned or to be purchased by the Bank in its performance of Trust Services; and g. Any other instruments, documents or agreements necessary to and connected with the provision of general Trust Services. B. Trust Real Estate Activities RESOLVED that, with regard to any interest in real property to which the Bank holds title in its performance of Trust Services, or which it manages in its performance of Trust Services, any employee designated in writing as a Class B signer by the Wealth Management Executive Officer is authorized and empowered as hereinabove set forth to sign, execute and deliver: 1. Grant deeds, mineral deeds, quit claim deeds, fiduciary's warranty deeds, statutory warranty deeds, fulfillment deeds, secured or unsecured notes upon the real property, leases or extensions, modifications or amendments thereof, construction contracts, property management agreements, or purchase sale agreements; 2. Requests to any trustee or trustees named in any deed of trust for a full or partial reconveyance of the property covered by such deed of trust; 3. Trust checks, escrow instructions, closing settlement statements, property management agreements, construction contracts, indemnification letters, petitions and depositions in legal actions, multiple listing agreements, excise tax affidavits, tax appeals, forfeiture documents, notices to vacate; and 4. Any other legal document or instrument not heretofore enumerated which is required in the management, as specified by each trust or agency agreement, of such real property. C. Global Custody Activities RESOLVED that any officer designated in writing as a Class C signer by the Institutional Services Executive Officer is authorized and empowered as hereinabove set forth: 1 To accept and transact foreign exchange contracts related to clients' account activities; 2. To sign any documents or instruments as may be required to conduct business with a sub -custodian bank or foreign tax authority; 3. To authorize electronic transmission of data and information; and 4. To sign, execute and deliver any other legal document or instrument not heretofore enumerated which is required in the conduct of global custody activities. D. Trust Operations Activities RESOLVED that any employee designated in writing as a Class D signer by the Institutional Services Executive Officer is authorized and empowered as hereinabove set forth to sign, execute and deliver: 1. Trust checks, certifications of balances or asset holding; and 2. Any other documents, instruments, or contracts as may be required to participate in any securities depository for securities held by the Bank, in its performance of Trust Services, and to provide cash management and accounting services to trust clients. E. Trust Security Services Activities RESOLVED that any officer designated in writing as a Class E signer by the Institutional Services Executive Officer is authorized and empowered as hereinabove set forth to sign, execute and deliver: 1. Documents necessary to purchase, endorse, transfer, sell, assign, pledge, encumber, hypothecate, lease, release, convey, deliver or request payment or reissue of any and all certificates for shares of stock of corporations, bonds, stock warrants and rights, deposit receipts for stocks and bonds, promissory notes, warrants for irrigation and reclamation districts, debentures, voting trust certificates, money market instruments, commercial paper, repurchase agreements and banker's acceptances, investment agreements, and any and all other documents or instruments representing or evidencing any equity or debt interest in corporations, governmental entities or in personal property, standing in the name of or owned or to be purchased by the Bank in its performance of Trust Services; 2. To sign certificates for securities deposited, interim certificates and other certificates for or on behalf of this Bank as depositary or agent; and To sign, countersign, certify, register, authenticate and identify all bonds, notes, interim certificates, share certificates, certificates of stock, voting trust certificates, depository receipts, warrants, participation certification or similar instruments for or in respect of which the Bank may be acting as trustee, agent or custodian. F. Mutual Fund Support Services and Activities RESOLVED that any officer designated in writing as a Class F signer by the Institutional Services Executive Officer is authorized and empowered as hereinabove set forth to sign, execute and deliver: 1. Any instrument, trust, contract or other document by which the Bank agrees or declines to act or resigns as custodian, transfer agent, fund accountant or other service provider 2. to registered or unregistered investment companies or other collective investment entities ("mutual fund support services"); 3. Any instrument, or other document and to perform any other act necessary or desirable to comply with applicable law and regulation in the provision of mutual fund support services, including but not limited to: a. Any registration, application, filing, update, amendment or other document necessary to commence or continue operation of mutual fund support services permissible under applicable law and regulation; and b. Any regulatory filings, accountings, reports, mailings, exemptive applications, requests for advice or rulings required by or desirable under applicable law to be prepared in connection with the provision of mutual fund support services. G. Tax Activities RESOLVED that any officer designated in writing as a Class G signer by the Wealth Management Executive Officer is authorized and empowered as hereinabove set forth to sign, execute, and submit local, state and federal tax returns or other filings, applications, extensions, requests for rulings or reports by the Bank as may be necessary or desirable in its performance of Trust Services or as a sponsor of a common trust fund or collective investment fund_ H. Securities Transfer Agents Medallion Program ("STAMP") RESOLVED that any officer designated in writing as a Class H signer by the Institutional Services Executive Officer or Wealth Management Executive Officer is authorized and empowered as hereinabove set forth to guarantee signatures on securities and stock or bond powers as a participant in the Securities Transfer Agents Medallion Program ("STAMP"), except that no signer is authorized to utilize this authority for signature or endorsement guarantees on other documents or to guarantee the signer's own signature. Trade Order Entry Activities RESOLVED that any officer designated in writing as a Class I signer by the Institutional Services Executive Officer or Wealth Management Executive Officer is authorized and empowered as herein above set forth to electronically enter security trades, to purchase or sell securities held in all types of accounts, using the SEI Trade Order Entry (TOE) system in its performance of Trust Services. FURTHER RESOLVED that the Institutional Services Executive Officer and the Wealth Management Executive Officer empowered in this Resolution to designate employees and officers to carry out various activities on behalf of the Bank may delegate, in writing, his/her authority to so designate to a senior officer(s) with the Institutional Services or Wealth Management Divisions, as appropriate. Such delegations of authority are to be filed with the Corporate Secretary and are to be reviewed as appropriate. FURTHER RESOLVED that this Resolution of Authority shall be effective as of April 22, 2009 and that, effective as of that date, the Trust Services Resolution of Authority adopted by this Board on May 22, 2008 is hereby superseded. I certify that the foregoing resolution was adopted by the Board of Directors of Union Bank, N.A. at the Regular Meeting of said Board held on April 22, 2009. I further certify that the foregoing resolution now stands on the records of the books of the Bank and has not been modified, repealed or set aside in any manner whatsoever and is now in full force and effect. Dated: Sepi-embcf 6$ 26i o Assil tant Secretary $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. CERTIFICATE OF TRUSTEE The undersigned hereby states and certifies: (i) that the undersigned is an authorized officer of Union Bank, N.A. ("Union Bank"), as trustee for the National City Joint Powers Financing Authority (San Diego County, California) Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), issued pursuant to the Trust Indenture, dated as of October 1, 1998, by and between Union Bank, as trustee, and National City Joint Powers Financing Authority, and as such, is familiar with the facts herein certified and is authorized and qualified to certify the same; (ii) that Union Bank is a national banking association duly organized, validly existing and in good standing under the laws of the United States of America, having full power and being qualified and duly authorized to perform the duties and obligations of Union Bank under and pursuant to the Irrevocable Refunding Instructions, dated as of September 28, 2010 (the "Instructions"), given to it by the City of National City; (iii) that the Instructions constitute the legal, valid and binding obligations of Union Bank, enforceable against Union Bank in accordance with their terms, subject to laws relating to bankruptcy, insolvency or other laws affecting the enforcement of creditors' rights generally and the application of equitable principles if equitable remedies are sought; (iv) that Union Bank has all necessary powers required to perform its duties and obligations under the Instructions; (v) that the acceptance by Union Bank of the duties and obligations of Union Bank under the Instructions and compliance with the provisions thereof will not conflict with or constitute a breach of or default under any law, administrative regulation, consent decree or any agreement or other instrument to which Union Bank is subject; and (vi) that Union Bank has not been served in any action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, governmental agency, public board or body, no such action is pending, nor, to the best of the knowledge of Union Bank, is any such action, suit, proceeding, inquiry or investigation threatened against Union Bank affecting the existence of Union Bank, or the titles of its officers to their respective offices or in any way contesting the powers of Union Bank or its authority to perform its obligations under the Instructions, wherein an unfavorable decision, ruling or finding would materially adversely affect the validity or enforceability of the Instructions. [Signature Page Follows] 131457423 IN WITNESS WHEREOF, the undersigned has executed this Certificate this 28th day of September, 2010. UNION BANK, N.A., as Trustee By: 13145742 Authorized Officer (Certificate of Trustee) $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. TRUSTEE'S RECEIPT OF FUNDS FOR DEPOSIT IN THE BOND FUND The undersigned, an authorized officer of Union Bank, N.A. ("Union Bank"), hereby certifies that as of the date hereof: (a) Union Bank is trustee for the National City Joint Powers Financing Authority (San Diego County, California) Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project) (the "Bonds"), issued pursuant to the Trust Indenture, dated as of October 1, 1998 (the "Indenture"), by and between the Union Bank and National City Joint Powers Financing Authority (the "Authority"); (b) Union Bank has accepted the Irrevocable Refunding Instructions, dated as of September 28, 2010 (the "Instructions"), given to it by the City of National City for the purpose of providing for the payment and prepayment of the Bonds and discharging the Bonds and the obligations represented thereby; (c) Union Bank deposited in the Bond Fund an amount of $3,357,079.91 in immediately available funds, such amount being derived from (i) an amount of $3,072,079.91 provided by Bank of America, N.A. under that certain Assignment Agreement, dated as of September 1, 2010, between Bank of America, N.A. and the Authority and (ii) an amount of $285,000 deposited with the Trustee by the City; and (d) Union Bank will use the amounts described in paragraph (c) as directed pursuant to the terms of the Instructions. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Instructions. [Signature Page Follows] 13145742 IN WITNESS WHEREOF, the undersigned has executed this Receipt this 28th day of September, 2010. UNION BANK, N.A., as Trustee By: 13145742 [Trustee's Receipt] �- CALIFORNIA -� Mayor Ron Morrison Council Members Alejandra Sotelo-Solis Jess Van Deventer Rosalie Zarate September 28, 2010 NATIONAL L CITY tNCORPOAATED Office of the City Attorney Bank of America, N.A. 555 California Street, 4th Floor San Francisco, California 94104 City Attorney Claudia Gacitua Silva Legal Counsel George H. Eiser, Ill Senior Assistant City Attorney Jodi L. Doucette Re: $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. Ladies and Gentlemen: I am the City Attorney of the City of National City (the "City"), and as such, have acted as General Counsel to the National City Joint Powers Financing Authority (the "Authority") in connection with the refunding of the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), which were originally issued and delivered in the aggregate principal amount of $6,255,000, and the prepayment of the City's lease payments under the Amended and Restated Lease Agreement, dated as of October 1, 1998, by and between the Authority, as lessor, and the City, as lessee. In that connection, I have examined the documents listed below (collectively, the "Authority Documents") and such additional documents and information as I have deemed necessary in to render this opinion: (a) Termination Agreement, dated as of September 1, 2010, among the Authority, the City, and the Trustee; (b) Lease Agreement, dated as of September 1, 2010, between the Authority, as lessor, and the City, as lessee; (c) Assignment Agreement, dated as of September 1, 2010, between the Authority, as assignor, and Bank of America, N.A, as assignee; and (d) Irrevocable Refunding Instructions, dated as of September 28, 2010, executed by the City and accepted by the Authority. 1243 National City Boulevard; National City, California 91950-4301 Tel.: (619) 336.4220 Fax: (619) 336.4327 Bank of America, N.A. September 28, 2010 Page 2 of 2 Based upon the foregoing, I am of the opinion, as of the date hereof, that: 1. The Authority is a joint exercise of powers agency duly organized and validly existing under the Constitution and laws of the State of California. 2. Resolution No. 2010 — 2 entitled "Resolution of the National City Joint Powers Financing Authority (1) Terminating the 1998 Lease Agreement between the National City Joint Powers Financing Authority, the City of National City,w and Union Bank of California; (2) Approving the New Lease Agreement between the City and the National City Joint Powers Financing Authority; and, (3) Approving the Assignment Agreement between the Authority and the Lender. With this Refinance, the General Fund will realize a direct savings of $137,000 in FY 10-11" (the "Authority Resolution") has been duly adopted, and the Authority Resolution is in full force and effect and has not been modified, amended or rescinded. 3. The Authority Documents have been duly authorized, executed and delivered by the Authority and, assuming due authorization, execution and delivery thereof by the respective other parties thereto, constitute legal, valid and binding obligations of the Authority enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, reorganization, insolvency, moratorium and other laws affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by the application of equitable principles if equitable remedies are sought. 4. To the best of my knowledge, the execution and delivery of the Authority Documents, the adoption of the Authority Resolution, and compliance by the Authority with the provisions thereof do not and will not conflict with or constitute a breach of or a default under, the Authority's duties under said documents or any law, administrative regulation, court decree, resolution, charter, bylaws or other agreement know the them to which the Authority is subject or by which it is bound. ctfully submit` audia G. ilv Esq. City Attorn ity of National City and General Counsel, National City Joint Powers Financing Authority CALIFORNIA Mayor Ron Morrison Council Members Alejandra Sotelo-Solis Jess Van Deventer Rosalie Zarate September 28, 2010 NATIONAL CITY &I. E INCORPORATE Office of the City Attorney Bank of America, N.A. 555 California Street, 4th Floor San Francisco, California 94104 City Attorney Claudia Gacitua Silva Legal Counsel George H. Eiser, III Senior Assistant City Attorney Jodi L. Doucette RE: $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. Ladies and Gentlemen: I am the City Attorney of the City of National City (the "City"), and have acted as such in connection with the refunding of the National City Joint Powers Financing Authority Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), which were originally issued and delivered in the aggregate principal amount of $6,255,000, and the prepayment of the City's lease payments under the Amended and Restated Lease Agreement, dated as of October 1, 1998, by and between the National City Joint Powers Financing Authority (the "Authority"), as lessor, and the City, as lessee. In that connection, I have examined the documents listed below (collectively, the "City Documents") and such additional documents and inforniation as I have deemed necessary in to render this opinion: (a) Termination Agreement, dated as of September 1, 2010, among the Authority, the City, and the Trustee; (b) Lease Agreement, dated as of September 1, 2010 (the "Lease Agreement"), between the Authority, as lessor, and the City, as lessee; and (c) Irrevocable Refunding Instructions, dated as of September 28, 2010, executed by the City and accepted by the Authority. Based upon the foregoing, I am of the opinion, as of the date hereof, that: 1. The City is a general law city duly organized and existing under the laws of the State of California with full legal right, power and authority to enter into and perform all of its obligations under the City Documents and all other applicable agreements. 2. Resolution No. 2010-217 entitled "Resolution of the City Council of the City of National City (1) Authorizing Proceedings to Refinance $3,280,000 Outstanding 1998 Lease Revenue Bonds; (2) Terminating the 1998 Lease Agreement between the City, the National City Joint Powers Financing Authority, and Union Bank of California; (3) Approving the New Lease 1243 National City Boulevard; National City, California 91950-4301 Tel.: (619) 336.4220 Fax: (619) 336.4327 Bank of America, N.A. September 28, 2010 Page 2 of 3 Agreement between the City and the National City Joint Powers Financing Authority; (4) Approving the Assignment Agreement between the Authority and the Lender; and (5) Approving the Irrevocable Refunding instructions given by the City to the 1998 Trustee. With this Refinance, the General Fund will Realize a Direct Savings of $137,000 in FY 10-11" (the "City Resolution"), has been duly adopted, and the City Resolution is in full force and effect and has not been modified, amended or rescinded. 3. The City has duly authorized, executed and delivered the City Documents and, assuming due authorization, execution and delivery thereof by the respective other parties thereto, the City Documents constitute legal, valid and binding agreements of the City enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium and other laws affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by the application of equitable principles if equitable remedies are sought. 4. No action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body, is pending or threatened in any way affecting the existence of the City or the titles of its officers to their respective offices, or in any way contesting or affecting the validity or enforceability of the City Resolution, the City Documents or any other applicable agreements or any action of the City contemplated by any of said documents, or in any way contesting the powers of the City or its authority with respect to the City Resolution, the City Documents, or any other applicable agreement, or any action on the part of the City contemplated by any of said documents, or contesting or affecting or in any way seeking to enjoin or restrain the City from acquiring, operating, maintaining, and paying Lease Payments (as defined in the Lease), or which if determined adversely to the City would have a material and adverse effect upon the City's ability to make the Lease Payments, nor to my knowledge is there any basis therefor. 5. The City is not in breach of or default under any law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either of thereof, or any applicable court or administrative decree or order or any loan agreement, note, bond, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound and which would materially impair the ability of the City to perform its obligations under the City Documents. 6. The adoption of the City Resolution and the execution and delivery of the City Documents, any other applicable agreements and the other instruments contemplated by any of such documents to which the City is a party, and compliance with the provisions of each thereof, do not and will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State of California, the United States of America, or of any department, division, agency or instrumentality of either thereof', or any applicable court or administrative decree or order or any loan agreement, note, bond, resolution, indenture, contract, agreement or other instrument to which the City is a party or is otherwise subject or bound. Bank of America, N.A. September 28, 2010 Page 3 of 3 7. All approvals, consents, authorizations, elections and orders of or filings or registrations with any governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to or the absence of which would materially adversely affect, the performance by the City of its obligations under the City Resolution, the City Documents, and any other applicable agreements, have been obtained and are in full force and effect. s . ectfully s itted, l Ji �1a G. S .q. City Attorney, of National City and General Cou sel, National City Joint Powers Financing Authority REPORT OF PROPOSED DEBT ISSUANCE California Debt and Investment Advisory Commission 915 Capitol Mall, Room 400, Sacramento, CA 95814 P.O. Box 942809, Sacramento, CA 94209-0001 Tel.: (916) 65J-3269 FAX: (916) 654-7440 RECEIVED By jfield at 1:47 pm, Sep 27, 2010 Completion and timely submittal of this form to the California Debt and Investment Advisory Commission (CDIAC) at the above address will assure your compliance with existing California State law and will assist in the maintenance of a complete database of public debt in California. Thank you for your cooperation.' ISSUER NAME: National City Joint Powers Financing Authority For Office Use Only CDIAC 4: (If pool bond, list participants) ISSUE NAME: Lease Financing with Bank of America, N.A. Please specify type/name of project: Refunding PROPOSED SALE DATE: 09/28/2010 PRINCIPAL TO BE SOLD: S 3,115,000.00 IS ANY PORTION OF THE DEBT FOR REFUNDING91 No roposed amount for refunding $ 3,357,079.91 Issuer Contact: Name: Jeanette Ladrido Title: Finance Director Address: 1243 National City Blvd., National City, CA 91950 Phone: (619) 336-4331 E-mail: Jladrido@nationalei ca. ov tY 9 Issuer Located In San Diego County Filing Contact: Name of Individual (representing: (3,ond Counsel Issuer, Financial Advisor, or Lead Underwriter) who completed this form and may be contacted for information: Name: Charles C. Wolf, Esq. Firm/Agency: Nixon Peabody LLP Address: Gas Company Tower, 555 W. Fifth Street, 46th Floor, Los Angeles, CA 90013 Phone: (213) 629-6066 E-mail: cwolf@nixonpeabody.com Send acknowledgement/copies to: Lois J. Broussard E-mail: lroussard®nixonpeabody.com FINANCING PARTICIPANTS: BOND COUNSEL: Nixon Peabody LLP FINANCIAL ADVISOR: Urban Futures, Inc. UNDERWRITERIPURCHASER: Bank of America, N.A. IS THE INTEREST ON THE DEBT TAXABLE? Under State law: Under Federal law: If the issue is federally tax-exempt, is interest a specific preference item for the purpose of alternative minimum tax? Yes, preference item No, not a preference item TYPE OF SALE: Competitive Negotiated YES (taxable) YES (taxable) Section 10i55(k1 of the California Government (:ode requires the issuer of any proposed new public debt issue to give written notice of the proposed sole to the C151A( no later than 3!1 days prior to the sale. (hider ('adjornta Government ('ode Section NN55(l), "The issuer of an). new public debt issue shall, not later than 45 days after the signing al the hood purchase contract in a negotiated or private financing or after /hr acceptance of a bid to a competitive offering, submit a report of final sale and official statement to the Commission. The Commission may require information to he submitted in the report of final sale that is considered appropriate. " Section 53583(c)l2)(B) of the California Government Code requires that any local agency selling refunding bonds at private sale or on a negotiated hays shall send a written rtutenienl, within two weeks after the bonds are sold, to the CDIAC explaining the reasons why the local agency determined to .sell the bonds at private sale or on a negotiated ham. instead of at public sale. CDIAC: Report of Proposed Debt Issuance TYPE OF DEBT INSTRUMENT NOTE Bond anticipation (BAN) Grant anticipation (GAN) Other note (Please specify below.) (OTHN) Revenue anticipation (RAN) Tax allocation (TALN) Tax and revenue anticipation (TRAN) Tax anticipation (TAN) Commerci �aper(CP ertificates of participation/leases (COPL Othe Please specify if "Other note/Other bond/Other" was checked: SOURCE(S) OF REPAYMENT Bond eneral fund of issuing jurisdiction (GNF—I: Grant sTrD"""— Intergovernmental transfers other than grants (ITGV) Local obligations (LOB) Private obligor payments (POP) Other (Please specify.) (OTHS): Paee 2 BOND Conduit revenue (Private obligor) (CRB) General obligation (GOB) Limited tax obligation (LTOB) Other bond (Please specify below.) (OTHB) Public lease revenue (PLRB) Revenue (Pool) (RB) Revenue (Public enterprise) (PERB) Sales tax revenue (STRB) Special assessment (SAB) Tax allocation (TAB) PURPOSE(S) OF FINANCING Cash flow, interim financing (CFIF) Project, interim financing (PIF) College/university housing (CUH) Multifamily housing (MFH) Single-family housing (SFH) Health care facilities (HCF) Hospital (HOSP) Other/multiple health care purposes (equipment; etc.)(OMHC) College/university facility (CUF) K-I2 school facility (KSCH) Other/multiple education uses (equipment, etc.)(OMED) Student loans (SLC) Redevelopment, multiple uses (RD) Commercial development (CMDV) Industrial development (INDV) Pollution control (PC) Property tax revenues (PRTX) Public enterprise revenues (PER) Sales tax revenues (SATR) Special assessments (SA) Special tax revenues (SPTR) Tax -increment (TI) Airport (APRT) Bridges and highways (BRHI) Convention center (CCTR) Equipment (EQUP) Flood control/storm drainage (FLDS) Multiple capital improvements and public works (MCAP) Other capital improvements and public works (OCAP) Parking (PRKG) Parks/open space (PRKO) Ports and marinas (PRTS) Power generation/transmission (PWR) Prisons/jails/correctional facilities (PRSN) Public building (PB) Public transit (PTR) Recreation and sports facilities (RCSP) Seismic safety improvements/repair (SSI) Solid waste recovery facilities (SWST) Street construction and improvements (SCI) Wastewater collection and treatment (WSTW ) Water supply/storage/distribution (WTR) Insurance/,-, '.I .ids IPF) Please specify type/name of project if different from above: Refinance of Lease Payments and Prepayment of the Bonds STATE OF CALIFORNIA Bill Lockyer State Treasurer and Chair CALIFORNIA DEBT AND INVESTMENT ADVISORY COMMISSION 915 CAPITOL MALL ROOM 400 PO BOX 942809 SACRAMENTO CA 94209-0001 TELEPHONE: (916) 653-3269 FAX: (916) 654-7440 TO: Lois J Broussard Nixon Peabody LLP 555 W Fifth St 46th FI Gas Company Tower Los Angeles, CA 90013-1025 FROM: M pbell, Executive Director September 28, 2010 RE: ACKNOWLEDGEMENT OF REPORT OF PROPOSED DEBT ISSUANCE California Government Code Section 8855 requires written notice to be given to the California Debt and Investment Advisory Commission (CDIAC) no later than 30 days prior to the proposed sale of any public agency debt issue. CDIAC acknowledges receipt of your notice of the following proposed debt issuance: CDIAC Number: 2010-1273 Issuer: National City Joint Powers Financing Authority Project: Other purpose Proposed Amount: $3,115,000 Proposed Sale Date: September 28, 2010 Date Notice Recieved: September 23, 2010 Issuers may electronically file the Report of Final Sale through CDIAC's website, using the following information: CDIAC Number: 2010-1273 Password: 214800 A CDIAC Number and Password will be provided for each electronic filing of the Report of Proposed Debt Issuance. This information is unique to this filing and must be used for any subsequent reporting under this CDIAC Number. Please submit the Report of Final Sale and the Official Statement/Offering Memorandum or other Bond Documents in accordance with Government Code Section 8855 on this issue within 45 days of the signing of the bond purchase contract or the acceptance of a bid to purchase the debt, to www.treasurer.ca.gov/cdiac/reporting.asp under the heading "Reporting Forms". Official Statements/Offering Memorandums or other Bond Documents can be sent by e-mail to CDIAC_issuance@treasurer.ca.gov. Any questions regarding reporting requirements may be directed to CDIAC's Data Unit at (916) 653-3269. Cc: Jeanette H Ladrido Financial Services Officer 4- 4 REPORT OF FINAL SALE California Debt and Investment Advisory Commission 915 Capitol Mall, Room 400, Sacramento, CA 95814 P.O. Box 942809, Sacramento, CA 94209-0001 Tel.: (916) 653-3269 FAX: (916) 654-7440 - tinder California Government Code Section 8855(i), "The issuer of any new public debt issue shall, not later than 45 days after the signing of the bond purchase contract in a negotiated or private financing, or after the acceptance of a bid in a competitive offering. submit a report of final sale and official statement to the Commission. The Commission may require information to be submitted in the report of final sale that is considered appropriate." ISSUER NAME: National City Joint Powers Financing Authority For Office Use Only Received by CDIAC on 10/01/10 CDIAC #: 2010-1273 (II pool bond, list participants) ISSUE NAME: Lease Financing with Bank of America, N.A. IF THIS IS A POOLED FINANCING, WHICH ISSUANCE STATUTE IS IT AUTHORIZED UNDER? I) Marks -Roos Local Bond Pooling Act 2) JPA Law 3) Installment Sales Agreement, Lease... 4) Housing Revenue Bond Law & Industrial Development Bond Law 5) Other - WILL A VALIDATION ACTION BE PURSUED: Yes Unknown ACTUAL SALE DATE: 09/28/2010 PRINCIPAL SOLD: $ 3,115,000.00 IS ANY PORTION OF THE DEBT FOR REFUNDING?' No t i funding amount (including costs) $ 3,357,079.91 Issuer Contact: Name: Jeanette Ladrido Title: Finance Director Address: 1243 National City Blvd., National City, CA 91950 Phone: (619) 336-4331 E-Mail: jladrido@nationalcityca.gov Issuer Located in San Diego County Filing Contact: Name of Individual (representing: t`Rond CounsjD Issuer, Financial Advisor, or Lead Underwriter) who completed this form and may be contacted for information: Name: Charles C. Wolf, Esq. Firm/Agency: Nixon Peabody LLP Address: Gas Company Tower, 555 W. Fifth Street, 46th Floor, Los Angeles, CA 90013 Phone: (213) 629-6066 Send acknowledgement/copies to: Lois J. Broussard E-Mail: cwolf@n ixon peabody. corn F,-mail: Iroussard@nixonpeabody. corn Name of individual to whom an invoice for the CDIAC issue fee should be sent:' Name: Nabeel Badawi, Assistant Vice President Firm: Union Bank Address: 120 S. San Pedro Street, Suite 400, MC 4-102-080, Los Angeles, CA 90012 Phone: (213) 972-5665 CDIAC: Report of Final Sale Pace 2 Secton 33583(c)(2)(B) of the California Government Code requires that any local agency selling refunding bonds at private sale or on a negotiated basis shall send a written statement, within two weeks after the bonds are sold to the CDI.4C explaining the reasons why the local agency determined to sell the bonds at a private sole or on a negotiated basis instead of ar public sale. This fee is authorized by Section 8856 of the California Government Code and is charged to the lead underwriter or purchaser of the issue. The fee is administratively set by the Commission. The current fee schedule may be obtained from CDIAC M1 FINANCING PARTICIPANTS (Firm name) FINANCIAL ADVISOR: Urban Futures, Inc. LEAD UNDERWRITER/PURCHASER: Bank of America, N.A. BOND COUNSEL: Nixon Peabody LLP TRUSTEE/PAYING AGENT: Union Bank MATURITY SCHEDULE Cttache) Included in Official Statement MATURITY STRUCTURE Term (T) Serial and term bonds or two or more term (B) FINAL MATURITY DATE: 10/01/2017 FIRST OPTIONAL CALL DATE: N/A SENIOR/SUBORDINATE STRUCTURE Yes No OFFICIAL STATEMENT/OFFERING MEMORANDUM: Enclosed .None prepared WAS THE ISSUE INSURED OR GUARANTEED? No Bond Insurance (I) Letter of Credit (L) State Intercept Program (T) @her (0� GUARANTOR: Stewart Title of Califomia, Inc. (Title Insurance Policy) ENHANCEMENT EXPIRATION DATE: INDICATE CREDIT RATING: (For example, "AAA" or "Aaa") Nol Rated') Rated Standard & Poor's: Fitch: Moody's: Other: N/A REASON FOR NEGOTIATED REFUNDINGS If the issue is a negotiated refunding, indicate the reason(s) why the bonds were issued at a private or negotiated versus a competitive sale. Ill Timing of the sale provided more flexibility than a public sale (2) More cost savings were expected to be realized than a public sale 13) More Ilexibiliry in debt structure was available than a public sale 14) Issuer able to work with participants familiar with issue/r than a public OFFICE LOCATION (City/State) Orange, CA Scottsdale, AZ Los Angeles, CA Los Angeles, CA IS THE INTEREST ON THE DEBT TAXABLE? Under State Law: No (tax-exem.t Yes (taxable) Under Federal Law: Yes (taxable) If the issue is federally tax-e, - . , Is interest a specific preferenc item for the purpose of alternative minimum tax? Yes f INTEREST TYPE: NIC INTEREST COST: 3.00 Variable CAPITAL APPRECIATION BOND: ISSUANCE COSTS AND FEES: A) Management Fee $ Yes B) Total Takedown $ C) Underwriter Expenses $ Underwriter Spread or Discount $ D) Bond Counsel $ 17,500.00 E) Disclosure Counsel $ F) Financial Advisor 0) Rating Agency $ H) Credit Enhancement $ I) Trustee Fee $ 750.00 1) Other Expenses $ 14,670.09 Total Issuance Costs $ 42,920, 09 K) ORIGINAL ISSUE PREMIUM $ LI ORIGINAL ISSUE DISCOUNT $ M) NET ORIGINAL ISSUE DISCOUNT/PREMIUM $ $ 10,000,00 FOR OFFICE USE ONLY FEE: $ CLOSING MEMORANDUM $3,115,000 City of National City and National City Joint Powers Financing Authority Lease Financing with Bank of America, N.A. Preclosing: Monday, September 27 2010 at 1:00 p.m. (PDT) Closing: Tuesday, September 28, 2010 at 9:30 a.m. (PDT) This Memorandum sets forth the documents required for prepaying the National City Joint Powers Financing Authority (San Diego County, California) Lease Revenue Refunding Bonds, Series 1998 (Police Facilities Project), which are currently outstanding in the aggregate principal amount of $3,280,000, and the related lease payments. List of Parties City of National City National City Joint Powers Financing Authority Claudia G. Silva, Esq., as City Attorney and General Counsel to the Authority Urban Futures, Inc., as Financial Advisor Southwest Securities, as Placing Agent Union Bank, N.A., as Trustee Bank of America, N.A. Nixon Peabody LLP, as Underwriter's Counsel Stewart Title of California, Inc., as Title Insurer "City" "Authority" "City Attorney" and "General Counsel" "UF" "SS" "Trustee" "BofA" "NP„ "Stewart Title" 13145742.3 Responsible Parties I. BASIC LEGAL DOCUMENTS Signatories 1. Resolution No. 2010-217 entitled "Resolution of the City, NP City Clerk City Council of the City of National City (1) Authorizing Proceedings to Refinance $3,280,000 Outstanding 1998 Lease Revenue Bonds; (2) Terminating the 1998 Lease Agreement between the City, the National City Joint Powers Financing Authority, and Union Bank of California; (3) Approving the New Lease Agreement between the City and the National City Joint Powers Financing Authority; (4) Approving the Assignment Agreement between the Authority and the Lender; and (5) Approving the Irrevocable Refunding Instructions given by the City to the 1998 Trustee. With this Refinance, the General Fund will Realize a Direct Savings of $137,000 in FY 10-11" adopted on September 21, 2010, as certified by the City Clerk. 2. Resolution No. 2010 — 2 entitled "Resolution of the National City Joint Powers Financing Authority (1) Terminating the 1998 Lease Agreement between the National City Joint Powers Financing Authority, the City of National City, and Union Bank of California; (2) Approving the New Lease Agreement between the City and the National City Joint Powers Financing Authority; and, (3) Approving the Assignment Agreement between the Authority and the Lender. with this Refinance, the General Fund will Realize a direct Savings of $137,000 in FY 10-11" adopted on September 21, 2010, as certified by the Secretary of the Authority. Authority, NP Secretary of the Authority 13145742,3 2 3. Termination Agreement, dated as of September 1, 2010, among the Authority, the City and the Trustee (to be recorded with the San Diego County Recorder). 4. Lease Agreement, dated as of September 1, 2010, between the Authority and the City (to be recorded with the San Diego County Recorder). 5. Assignment Agreement, dated as of September 1, 2010, between the Authority, as assignor, and Bank of America, N.A., as assigee (to be recorded with the San Diego County Recorder). II. AUTHORITY DOCUMENTS NP NP NP Chairman of the Authority (notarized) and approved as to form by General Counsel and Secretary; Mayor of the City (notarized) and approved as to form by City Attorney and City Clerk; Trustee (notarized) Chairman of the Authority (notarized) and approved as to form by General Counsel and Secretary; Mayor of the City (notarized) and approved as to form by City Attorney and City Clerk Chairman of the Authority (notarized) and approved asto form by General Counsel and Secretary; BofA (notarized) 6. Initial Notice as to a Joint Powers Agreement, NP N/A including any and all amendments thereto, as certified by the California Secretary of State. 13145742.3 3 7. Statement of Facts Roster of Public Agencies Filings, as certified by the California Secretary of State. 8. Certificate Regarding Effectiveness of Joint Exercise of Powers Agreement, together with Joint Exercise of Powers Agreement, dated as of April 1, 1991, by and between the City and the Community Development Commission, and any and all amendments thereto. 9. Certificate Regarding Effectiveness of Rules and Regulations, together with Rules and Regulations and any and all amendments thereto. NP N/A NP NP Chairman of the Authority Chairman of the Authority 10. Officer's Certificate of the Authority. NP Chairman of the Authority; Secretary of the Authority 11. Internal Revenue Service Form 8038-G. NP Director of Finance 12. Notice of Redemption. City / Authority Trustee III. CITY DOCUMENTS 13. Officer's Certificate of the City. NP Mayor of the City; City Manager; Director of Finance; City Clerk 14. Irrevocable Refunding Instructions, dated as of NP Mayor of the City; September 28, 2010. approved as to form by City Attorney and City Clerk, accepted by Trustee 15. Custody Agreement, executed by the City and accepted by the Trustee. Trustee Authorized Officer of the City; Trustee 13145742.3 4 16. Evidence of, or commitment to provide, insurance, as City N/A required by Sections 5.3, 5.4, 5.5 and 5.6 of the Lease Agreement, together with letter regarding sufficiency of same. 17. CLTA Title Insurance Policy insuring the Assignee's City, Stewart Title Stewart Title interest in the estate, issued by Stewart Title Insurance Company, pursuant to Section 5.7 of the Lease Agreement. IV. TRUSTEE DOCUMENTS 18. Incumbency Certificate of the Trustee, together with certified general signing resolution. 19. Certificate of Trustee. 20. Trustee's Receipt of Funds for Deposit in the Bond Fund. V. LEGAL OPINIONS 21. Opinion of General Counsel to the Authority. 22. Opinion of City Attorney. VI. MISCELLANEOUS Trustee Trustee NP NP NP, General Counsel Trustee Trustee General Counsel NP, City Attorney City Attorney 23. Report of Proposed Debt Issuance to the California NP N/A Debt and Investment Advisory Commission; Confirmation, together with confirmation, and Final Notice to the California Debt and Investment Advisory Commission. 13145742.3 5