NO 2001-08 08 2001 RESOLUTION NO.

RESOLUTION

RESOLUTION OF OF INDIO, INDIO RESOLUTION OF THE THE INDIO INDIO WATER WATER AUTHORITY AUTHORITY,OF OF THE THE CITY CITY OF A IN THE THE PRINCIPAL ISSUANCE OF AUTHORIZING NOTE CALIFORNIA, AUTHORIZING THE ISSUANCE OF A NOTE IN THE PRINCIPAL CALIFORNIA CERTAIN FIVE MILLION MILLION DOLLARS AND TAKING TAKING CERTAIN DOLLARS ($5,000,000) AMOUNT AMOUNT OF OF FIVE 000 AND 5 000 IN CONNECTION OTHER OTHER ACTIONS ACTIONS IN CONNECTION THEREWITH
Indio (the the Indio Water Water Authority Authority the (the Authority "Authority") and and the the City City of of Indio WHEREAS WHEREAS, the the dated into that certain 2001 Lease have entered "City") have previously entered into that certain Lease Agreement, dated May 22, 2001 22 May previously Agreement City amended by the First Amendment Amendment to (as by the the First to Lease Lease, dated dated as as of of September 17, 2001 2001, the September 17 as amended the Authority leased to the "Lease"), pursuant pursuantto to which which the the City City leased to the substantially all all of of the Lease Authority substantially of water used or or useful service within useful in in the the provision certain the City water service within certain assets of assets of the City used provision of Boundaries and boundaries of of the the City (the and the "System System Boundaries");

to the the Lease, the Authority Authority is is obligated obligated to to pay pay to to the the City Lease the WHEREAS WHEREAS, pursuant City pursuant to on November 1, an up an up-front lease lease payment payment of of $10,000,000 2001; and and 000 on 10 1 2001 front
the Lease be as provided WHEREAS, as provided in in the Lease, the the Authority Authority has has determined determined that that it it will will be WHEREAS unable to sell lease lease revenue revenue bonds unable to sell bonds for for the the full full amount amount of of the the first first lease lease payment payment under the and the Lease Lease; and

WHEREAS, pursuant to the the Lease, the Authority Authority intends intends to to issue issue a a note (the Lease the WHEREAS pursuant to the of in towards the the 2001 amount rent under the "Note") in the principal amount of $5,000,000 towards the 2001 rent payment under the 0 5 000 00 payment principal Note of which and has been obtained the Lease, acceptance of which has been obtained from from the the City City; and Lease the acceptance
Note will secured by WHEREAS, the the Note will be be secured by a a pledge pledge of of net net revenues revenues of of the the System WHEREAS System

(as as

defined in in the defined the

and Lease); and Lease

Board of Directors the Authority Directors (the has duly WHEREAS, the Board of the HEREAS the the "Board") duly Board of Authority has

considered in the the considered such such transaction transaction and and wishes wishes at at this this time time to to approve approve said said transaction transaction in
interest of the public interest the Authority Authority.

DOES HEREBY FIND, INDIO WATER NOW NOW, THEREFORE THEREFORE, THE THE INDIO WATER AUTHORITY AUTHORITY, DOES FIND FOLLOWS DETERMINE DETERMINE AND AND RESOLVE RESOLVE AS AS FOLLOWS:
The Board Board hereby Section 1 form Section 1. The hereby approves approves the the Note, substantially in in the the form Note substantially annexed hereto Exhibit A annexed hereto, marked "Exhibit A". other Responsible Executive Director, President, the Executive or any President the Director or any other Responsible authorized and directed is Authority, them, to execute execute Authority them is hereby hereby authorized and directed to and deliver and deliver any any and and all all documents documents and and instruments instruments and and to to do do and and cause cause to to be be done done any any for and out the and transactions or all acts and all acts and things necessary or proper proper for carrying carrying out the transactions things necessary Resolution contemplated by by this this Resolution. contemplated Officer Officer the the and of and each each of Section 2 Section 2. The The

Section 3

The

Secretary

shall

certify

to the

adoption

of this

thenceforth and thereafter the

same

shall be in full force and effect

Resolution and Notwithstanding the

foregoing such certification and any of the other duties and responsibilities assigned to the Secretary pursuant to this Resolution may be performed by a Deputy Secretary with the same force and effect as if performed by the Secretary hereunder
PASSED APPROVED following vote
AND ADOPTED this

17t day

of

September

2001

by

the

MELA

IE

FESMIRE

PRESIDENT

ATTEST

C S

THIA HERNANDEZ CRETARY

1
w

CERTIFICATION

I Cynthia Hernandez Secretary to the Indio Water Authority do hereby certify 08 adopted by forgoing to be a full true and correct copy of Resolution No 2001
Eoard of

the the
on

Commissioners
2001

of

the

Indio

ater N

Authority

at

regular meeting

September 17

this Hernandez

Secretary

EXHIBIT A

PROMISSORY NOTE

000 5 000

Interest Rate 00 6

Maturity Date
November

Dated Date

2026

November 1 2001

Registered

Owner

CITY OF

INDIO

CALIFORNIA

Principal

Sum

Five Million Dollars and No Cents

The T NDIO WATER and

AUTHORITY

public body corporate

and

politic duly organized

validly existing under and pursuant to the laws of the State of California the Authority for value received hereby promises to pay in lawful money of the United States ofAmerica but only out of the Net Revenues hereinafter referred to to the registered owner identified above or registered assigns principal and interest on this Note in the amounts and on the dates set forth on
Exhibit A attached hereto This Note may be prepaid in full at any time without penalty by paying outstanding principal amount of the Note together with accrued interest thereon to the date of prepayment Definitions Unless the context
r

clearly
J t

otherwise Inrrl7e

requires
O 7

or

unless otherwise

defined
777
zic

innY liv ivsl

6G t LC L bIGG

fn rv v7 777 c LJ GG b76

co 7L 6 J

i77 f

YII n C

1YVLG

lbl LGb Iiuv

1470 6icc

7l0 YNO C t7110 1177777 T C ir an iva iica a ut sc

ifio no Jcvw vv

1170

hTerein thTe
1 OIYCO Lva v z

v o

lii

YI

addition the following terms defined respective meanings herein specified

Allocated Costs
means

below

shall for

all purposes

of this Note

shall have the

payable to the City pursuant to that certain a Reimbursement Agreement dated as of July 1 2001 and entered into by and between the City and the Authority and b Employee Lease Agreement dated July 17 2001 and entered into by and between the City and the Authority
amount

Direct Costs

means

the

reasonable

and

operating the System including particularly described in Paragraph 2 b 3 management and repair and other costs and expenses necessary to maintain and preserve the System in good repair and working order and c the reasonable administrative costs of the Authority attributable to the operation and maintenance of the System but in all cases excluding i debt service payable on obligations incurred by the Authority with respect to the System ii depreciation replacement and obsolescence charges or reserves therefor and iii amortization of intangibles or other bookkeeping entries of a similar nature
maintaining
more

the

necessary costs and expenses paid for but not limited to a the costs and expenses of the Lease b the reasonable expenses of

of all gross charges received for and all other gross income and receipts derived by the Authority from the lease and operation of the System or otherwise arising from the System including but not limited to investment earnings thereon Gross Revenues
means

the

sum

Lease

means

the

Lease

dated

May 22 2001

as

amended by

and between the

Authority

and the

City

Net Revenues means with respect to any time period an amount equal to all of the Grass Revenue minus the amount required to pay all Direct Costs and Allocated Costs for such time

period
Pledge of 1V et
evenues

hereby irrevocably pledged charged and assigned by the Authority to the punctual payment of principal and interest on this Note and the Net Revenues shall not be used for any other purposes except capital improvements including debt service on bonded indebtedness or other obligations incurred by the Authority in connection with the System and other lawful purposes related to the System so long as any amount due with respect Such pledge charge and assignment shall constitute a first lien on to this Note remain unpaid the Net Revenues for the payment of principal and interest on this Note in accordance with the
All of the Net Revenues
are

terms hereof

Additional Terms and Conditions

Authority shall default in the payment when due of any installment becoming due under this Note then or at any time thereafter the entire principal of this Note irrespective of the maturity date specified in this Note together with the then accrued interest and to the extent permitted by law together with interest after the date of such default whether resulting from
If the acceleration become
or

not

at the same rate

as

the rate

on

this Note shall at the election of the

City

immediately

due and

payable
and

This Note shall be of California

governed by

interpreted

in accordance with the laws of the State

This Note may not be amended modified or changed nor shall any waiver of any provisions of this Note be effective except by an instrument in writing signed by the party

against
sought

whom enforcement of any

waiver amendment change

modification

or

discharge

is

Upon receipt
destruction
or

of evidence

reasonably satisfactory
and in the

to the

Authority

of the

case of any such loss theft to the Authority or in the case of any satisfactory delivery indemnity agreement reasonably such mutilation upon surrender and cancellation of this Note the Authority will execute and deliver to the City in lieu thereof a replacement note dated as of the date of this Note identical

mutilation of this

Note

or

loss theft destruction upon

of an

in form and substance to this Note The

Authority acknowledges

that this Note falls within the definition set forth in Section

c of the 6585

California Government Code

Y has WHEREOF, the the INDIO INDIO WATER WATER AUTHORIT AUTHORITY has caused caused this this Note Note to to WFIEREOF the manual of its on its its President manual signature its behalf President and behalf by be and executed in and on name and be executed in its its name signature of by the countersigned by the the manual manual signature signature of of its its Secretary Secretary, and and has has caused causedthis thisNote Noteto to be be dated dated as as of of countersigne d by the the above original issue issue date date specified specified above. original INDIO Y INDIO WATER WATER AUTHORIT AUTHORITY

WITNESS IN IN WITNESS

By
President President ATTEST ATTEST:

Secretary Secretary