Loading...
HomeMy Public PortalAboutResolution - 03-09- 20030312 - 2003 Promissory Notes MIDPENINSULA REGIONAL OPEN SPACE DISTRICT RESOLUTION NO. 03-09 A RESOLUTION OF THE BOARD OF DIRECTORS OF MIDPENINSULA REGIONAL OPEN SPACE DISTRICT PROVIDING FOR THE ISSUANCE AND DELIVERY OF THE MIDPENINSULA REGIONAL OPEN SPACE DISTRICT 2003 PROMISSORY NOTE I WHEREAS, the Board of Directors (the "Board") of the Midpeninsula Regional Open Space District (the"District") has found and determined that it is necessary and proper for i the purpose of implementing the District's plan to acquire necessary and proper lands and facilities for open space purposes of the District that the District acquire certain land more particularly described in Exhibit A attached hereto and incorporated herein (the "Land") currently owned by P. Michael Hunt and Sherry L. Hunt, as co-trustees of the Hunt Living Trust dated February 14, 1996 (the "Sellers"), by the purchase on contract of the Land from the Sellers; and WHEREAS, Section 5544.2 of the Public Resources Code of the State of California authorizes the issuance and delivery by the District of a promissory note to evidence the indebtedness to be incurred by the District for the purchase on contract of the Land from the Sellers, and the Board has determined to issue and deliver to the Sellers, and the Sellers have agreed to accept from the District, a promissory note (the "Note") issued under such section in the principal amount of one million five hundred thousand dollars ($1,500,000) to evidence the indebtedness to be incurred by the District for the purchase on contract of the Land from the Sellers; and I WHEREAS, it is necessary and proper for the District to adopt this resolution in order to provide the conditions and terms under and pursuant to which the Land will be purchased on contract by the District and the Note will be issued and delivered by the District to the Sellers; 1. I NOW, TBEREFORE, BE IT RESOLVED by the Board of Directors of S Mid peninsula Regional Open ace District as follows: p g P P Section 1. The Board has reviewed all heretofore taken relative to proceedings the purchase on contract of the Land from the Sellers and the issuance and delivery to the Sellers of the Note to evidence the indebtedness to be incurred for the purchase on contract of the Land i from the Sellers, and the Board has found, as a result of such review, and hereby finds and i determines that all acts, conditions and things required by law to exist, happen and be performed precedent to the purchase on contract of the Land from the Sellers and the issuance and delivery to the Sellers of the Note to evidence the indebtedness to be incurred for the purchase on contract i of the Land from the Sellers have existed, happened and been performed in regular and due time, form and manner as required by law, and the District is now duly authorized to purchase on contract the Land from the Sellers and to issue and deliver to the Sellers the Note to evidence the indebtedness to be incurred for the purchase on contract of the Land, all as provided in this resolution. Section 2. The District determines to issue and deliver to the Sellers the Note to evidence such indebtedness, which Note shall be numbered R-1, shall be designated the "Midpeninsula Regional Open Space District 2003 Promissory Note," shall be dated April 1, 2003, shall mature (subject to prior redemption as hereinafter provided) on April 1, 2023, and shall bear interest at the rate of five and one-half per cent (5-1/2%) per annum from the date of delivery of the Note until April 1, 2013, or the prior redemption of the Note(if redeemed prior to such date), and thereafter at the rate of five per cent (5%) per annum from such date until the maturity or the prior redemption of the Note, payable on October 1, 2003, and semiannually thereafter on April I and October I of each year and on the maturity or prior redemption of the Note. All interest on the Note shall be computed on the basis of a 360-day year of twelve (12)thirty-day calendar months and shall be payable in lawful money of the United States of America by the Treasurer of the District (the "Treasurer") at the office of the District in Los Altos, California, by check mailed by such officer on each interest payment date payable to the order of the Sellers, or registered assigns, except that the final payment of such interest shall be payable only on presentation and surrender of the Note to the Treasurer at the office of the District in Los Altos, California, at the maturity or the prior redemption of the Note, and the principal of the Note shall be payable in like lawful money on the maturity date or prior redemption date thereof upon surrender of the Note to the Treasurer at the office of the District in Los Altos, California. The registered owners of the Note may, at their option, require the District to prepay the Note in full on any date on or after April 1, 2008, upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of the Note, plus the accrued interest thereon, less a discount of nine-tenths of one per cent (9/10 of 1%) of the outstanding principal amount of the Note for each whole year remaining between the date of redemption and April 1, 2013 (and prorated for any partial year remaining in such period) if the redemption is on or prior to April 1, 2013, or with no discount if the redemption is after April 1, 2013; provid , that if at any time the interest payable on the Note is determined not to be excluded from gross income for federal income tax purposes or to be a specific preference item for purposes of federal income taxes under the Internal Revenue Code of 1986 (the "Code") or not to be exempt from State of California personal income taxes by any federal or state court or any ruling or regulation (final, temporary or proposed) or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or state authority affecting the federal or state tax status of the District or the interest on municipal bonds or notes, the registered owners of the Note may, at their sole option, require the District to prepay the Note in full on any date upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of the Note, plus the accrued interest thereon. The Note, together with the accrued interest thereon, shall become due and payable on any date designated by the registered owners of the Note not earlier than ten (10) days after notice thereof is given by the registered owners of the Note to the District, upon the occurrence of either of the following two events: (a) a default by the District in the payment of any interest on or principal of the Note when due which has not been cured within ten (10) days of written notice of such default by the registered owners of the Note to the District; or (b) a default in the performance by the District of any obligation or covenant of the District contained in the Note which has not been cured within ten (10) days of written notice of such default by the registered owners of the Note to the District; and in any such event, such delinquent payments shall bear interest from the date they became due until paid at the then applicable rate of interest on the Note, plus five per cent (5%) per annum. Section 3. The Note and the registration endorsement to appear thereon shall each be in substantially the following forms, the blanks in said forms to be filled in with appropriate words or figures, namely: [FORM OF NOTE] UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTIES OF SANTA CLARA, SAN MAT'EO,AND SANTA CRUZ MIDPENINSULA REGIONAL OPEN SPACE DISTRICT 2003 PROMISSORY NOTE No.R-1 $1,500,000 Dated: April 1,2003 Date of Delivery: April__,2003 The MIDPENINSULA REGIONAL OPEN SPACE DISTRICT, a regional open space district located in the Counties of Santa Clara, San Mateo and Santa Cruz, State of California (the "District"), hereby acknowledges itself indebted and for value received promises to pay to the order of P. Michael Hunt and Sherry L. Hunt, as co-trustees of the Hunt Living Trust dated February 14, 1996, or registered assigns, on April 1, 2023 (subject to prior redemption as hereinafter provided), the principal sum of ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000) together with interest thereon at the rate of five and one-half per cent (5-1/2%) per annum from the date of delivery hereof until April 1, 2013, or the prior redemption hereof(if redeemed prior to such date), and thereafter at the rate of five per cent (5%) per annurn from such date until the maturity or the prior redemption hereof, payable on October 1, 2003, and semiannually thereafter on April I and October I of each year and on the maturity or prior redemption of this Note. All interest on this Note shall be computed on the basis of a 360-day year of twelve (12) thirty-day calendar months and shall be payable in lawful money of the United States of America by the Treasurer of the District (the"Treasurer") at the office of the District in Los Altos, California, by check mailed by such officer on each interest payment date payable to the order of the registered owners hereof, or registered assigns, except that the final payment of such interest is payable only on presentation and surrender of this Note to the Treasurer at the office of the District in Los Altos, California, at the maturity or the prior redemption hereof, and the principal of this Note is payable in like lawful money on the maturity date or prior redemption date hereof upon surrender of this Note to the Treasurer at the office of the District in Los Altos, California. This Note is the sole note of a duly authorized issue of promissory notes of the District aggregating one million five hundred thousand dollars ($1,500,000), and is authorized to be issued pursuant to the conditions and terms of a resolution adopted by the affirmative vote of at least two-thirds (2/3) of the members of the Board of Directors of the District duly and regularly passed and adopted on March 12, 2003, under and by authority of Section 5544.2 of the Public Resources Code of the State of California. The registered owners of this Note may, at their option, require the District to prepay this Note in full on any date on or after April 1, 2008, upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of this Note, plus the accrued interest thereon, less a discount of nine-tenths of one per cent (9/10 of 1%) of the outstanding principal amount of this Note for each whole year remaining between the date of redemption and April 1, 2013 (and prorated for any partial year remaining in such period) if the redemption is on or prior to April 1, 2013, or with no discount if the redemption is after April 1, 2013; Pnvid , that if at any time the interest payable on this Note is determined not to be excluded from gross income for federal income tax purposes or to be a specific preference item for purposes of federal income taxes under the Internal Revenue Code of 1986 or not to be exempt from State of California personal income taxes by any federal or state court or any ruling or regulation (final, temporary or proposed)or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or state authority affecting the federal or state tax status of the District or the interest on municipal bonds or notes, the registered owners of this Note may, at their sole option, require the District to prepay this Note in full on any date upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the principal amount of this outstanding principal amount of this Note, plus the accrued interest thereon. This Note, together with the accrued interest thereon, shall become due and payable on any date designated by the registered owners of this Note not earlier than ten (10) days after notice thereof is given by the registered owners of this Note to the District, upon the occurrence of either of the following two events: (a) a default by the District in the payment of any interest on or principal of this Note when due which has not been cured within ten (10) days of written notice of such default by the registered owners of this Note to the District; or (b) a default in the performance by the District of any obligation or covenant of the District contained herein which has not been cured within ten (10) days of written notice of such default by the registered owners of this Note to the District; and in any such event, such delinquent payments shall bear interest from the date they became due until paid at the then applicable rate of interest on this Note, plus five per cent (5%) per annum. It is hereby certified, recited and declared that this Note is issued and delivered in strict conformity with the Constitution and laws of the State of California now in force and with the proceedings of the Board of Directors of the District authorizing the same, and that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance and delivery of this Note have existed, happened and been performed in regular and due time, form and manner as required by law, and that this Note, together with all indebtedness and obligations of the District, does not exceed any limit prescribed by the Constitution or statutes of the State of California, and that the interest on and principal of this Note is payable from limited ad valorem property taxes levied upon all taxable property within the District by the Board of Supervisors of Santa Clara County and by the Board of Supervisors of San Mateo County that are allocated to the District under applicable law; provided, that the repayment of this Note shall be junior and subordinate to all outstanding and subsequent notes, bonds, leases or other obligations secured by property tax revenues of the District or subsequent pledges of revenues created by the District for the purpose of financing the District's purposes or operations. IN WITNESS WBEREOF, the District has caused this Note to be signed by the President of its Board of Directors and attested by the Secretary of its Board of Directors, and has caused the seal of the District to be affixed thereto, and has caused this Note to be dated April 1, 2003. P sident of the Bo of Directors of Midpeninsula Regional Open Space District SEAL Attest: Secretary of the Board of Directors of Midpeninsula Regional Open Space District I i II [FORM OF ASSIGNMENT TO APPEAR ON NOTE] For value received the undersigned do hereby sell, assign and transfer unto the within Note and do hereby irrevocably constitute and appoint attorney to transfer the same on the note register of the District, with full power of substitution in the premises. Dated: SIGNATURE GUARANTEED BY: Note: The signatures to this Assignment must correspond with the names as written on the face of the within Note in every particular, without alteration or enlargement or any change whatsoever, and the signatures must be guaranteed by an eligible guarantor institution. Social Security Numbers, Taxpayer Identification Numbers or other identifying number of Assignees: Section 4. The President of the Board is hereby authorized and directed to manually execute the Note, and the Secretary of the Board is hereby authorized and directed to manually attest such execution of the Note and to affix the seal of the District thereto. Such signing, attesting and sealing as herein provided shall be a sufficient and binding execution of the Note by the District, and if either officer of the Board whose signature appears on the Note ceases to be such officer before the delivery of the Note, the signature of such officer appearing on the Note shall be valid and sufficient for all purposes to the same extent as if such officer had remained in office until the delivery of the Note. Section 5. For the purpose of paying the interest on and the principal of the Note, the District shall, until the interest on and the principal of the Note shall have been paid in full or until there is a sum in the treasury of the District set apart for that purpose sufficient to meet all payments of the interest on and the principal of the Note as they shall become due and payable, annually set aside a portion of the limited ad valorem taxes levied upon all taxable property within the District by the Board of Supervisors of Santa Clara County and by the Board of Supervisors of San Mateo County that are allocated to the District under applicable law (or other available funds of the District), sufficient to pay such interest and principal that will become due before the proceeds of a tax levied at the next general tax levy will be available; provided, that the repayment of the Note shall be junior and subordinate to all outstanding and subsequent notes, bonds, leases or other obligations secured by property tax revenues of the District or subsequent pledges of revenues created by the District for the purpose of financing the District's purposes or operations. Such taxes(or other available funds of the District) shall be deposited by the Treasurer in a special account maintained by him which shall be designated the "Midpeninsula Regional Open Space District 2003 Promissory Note Account" (the "Note Account"), and all money in the Note Account shall be used solely for the payment of the interest on and the principal of the Note. All money in the Note Account shall, pending its disbursement and consistent with Section 6 hereof, be deposited or invested as permitted by law so as to obtain the highest yield that the Treasurer deems practicable, having due regard for the safety of such deposits and j investments; provided that all such deposits and investments shall be withdrawable or shall mature, as the case may be, to coincide as nearly as practicable with the time when such money is required for disbursement hereunder, and any proceeds thereof shall be deposited in the Note Account. When the interest on and principal of the Note has been paid, any balance of money then remaining in the Note Account shall be used for any lawful District purpose. Section 6. The District will not take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of the interest on the Note pursuant to Section 103 of the Code, and specifically the District will not directly or indirectly use or make any use of the proceeds of the Note or any other funds of the District or take or omit to take any action that would cause the Note to be an "arbitrage bond" subject to federal income taxation by reason of Section 148 of the Code or a "private activity bond" subject to federal income taxation by reason of Section 141(a) of the Code or an obligation subject to federal income taxation because it is "federally guaranteed" as provided in Section 149(b) of the Code; and to that end the District, with respect to the proceeds of the Note and such other funds, will comply with all requirements of such sections of the Code (and all regulations of the United States Department of the Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect); rop vided, that if the District shall obtain an opinion of nationally recognized bond counsel to the effect that any action required under this section is no longer required to maintain the exclusion from gross income of the interest on the Note pursuant to Section 103 of the Code, the District may rely conclusively on such opinion in complying with the provisions hereof; and provide d further, that in the event that at any time the Board is of the opinion that for purposes of this section it is necessary to restrict or limit the yield on the investment of any moneys held by the District hereunder or otherwise, the Board shall so instruct the Treasurer in writing, and the Treasurer shall take such action as may be necessary in accordance with such instructions. Without limiting the generality of the foregoing, the District will pay from time to time all amounts required to be rebated to the United States of America pursuant to Section 148(f) of the Code and all regulations of the United States Department of Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect, which obligation shall survive payment in full or defeasance of the Note, and to that end, there is hereby established in the treasury of the District a fund to be known as the "Midpeninsula Regional Open Space District 2003 Promissory Note Rebate Fund" to be held and administered h r visions of the Tax Certificate wit h by the Treasurer. The District will comply with the pro respect to making deposits in the Rebate Fund, and all money held in the Rebate Fund is pledged to provide payments to the United States of America as provided herein and in the Tax Certificate and no other person shall have claim to such money except as provided in the Tax Certificate. Section 7. The Secretary of the Board is directed to cause the Note to be prepared to comply with the provisions hereof, and to procure its execution by the proper officers of the Board, and to deliver it, when so executed, to the Treasurer, who shall deliver it on or after its date to the Sellers at the time that the District purchases on contract the Land from the Sellers. The President of the Board and the Secretary of the Board are further authorized and directed to make, execute and deliver to the Sellers a signature certificate in the form customarily required by purchasers of notes of public districts, certifying to the genuineness and due execution of the Note, and the Treasurer is hereby authorized and directed to obtain from the Sellers at the time of the purchase on contract of the Land a receipt for the Note in the form customarily required from purchasers of notes of public districts, evidencing the delivery of the Note, which receipt shall be conclusive evidence that the Note has been duly delivered; and Sellers and any subsequent registered owners of the Note are hereby authorized to rely upon and shall be justified in relying upon any such signature certificate and any such receipt with respect to the Note issued and delivered pursuant to the authority of this resolution. Section 8. This resolution shall take effect from and after its passage and approval. PASSED AND ADOPTED this 12th day of March , 2003, by the following vote: AYES: N. Hanho, P. Siemenz, L. H"zett, M. Davey, J. Cyn, K. N4'tz, D. L.-ttfe NOES: none ABSENT: none APPROVED: P sident of the Board of Directors of Midpeninsula Regional Open Space District i'TEaT: Sec ary of the Boar of Dire ors of �Ifdpeninsula Regional pen Space District i SECRETARY'S CERTIFICATE 1, Kenneth C. Nitz Secretary of the Board of Directors of Midpeninsula Regional Open Space District, do hereby certify that the foregoing is a full, true and correct copy of a resolution duly adopted at a regular meeting of the Board of Directors of said District duly and regularly and legally held at the regular meeting place thereof on the 12th day of March, 2003, by the affirmative vote of at least two-thirds of the members of said Board, of which meeting all of the members of said Board had due notice and at which meeting at least two-thirds thereof were present and acted; that at said meeting said resolution was, upon motion of Director J. Clftt , seconded by Director D. Littee , adopted by the following vote: AYES: N. Hanho, J. Cytc, L. Hazsett, hf. Davey, P. Siemens, K. N,itz, D. Litt-fe NOES: none ABSENT: none I do hereby further certify that I have carefully compared the same with the original minutes of said meeting on file and of record in my office, and that said resolution is a full, true and correct copy of the original resolution adopted at said meeting and duly entered of record in said minutes, and that said resolution has not been amended, modified or rescinded since the date of its adoption and the same is now in full force and effect. WITNESS my hand this 12th day of March, 2003. ;tdpeninsula tary of the Board of rectors of Regional Q&n Space District EXHIBIT A [L.egal Description of the Land] All that certain real property situate in the unincorporated area of Santa Clara County, California, described as follows" PARCEL ONE: The North half of the Southwest quarter of Section 8, Township 9 South, Range 1 West, Mount Diablo Base and Meridian, according to the United States Goverment Survey therof. EXCEPTING THEREFROM the following described parcels of land: A: Beginning at a 3/4" iron pipe found at the South East corner of Parcel C, as shown on that certain Parcel Map recorded on July 17, 1973 in Book 326 of Maps at page 43, Santa Clara County Recorded; Thence North 83 Degrees 44 Minutes 00 Seconds West a distance of 20.07 feet to the true Point of Beginning of this Exception; thence South 43 Degrees 49 Minutes 48 Seconds East a distance of 28.33 feet thence South 02 Degrees 47 Minutes 22 Seconds East a distance of 108.09 feet; thence North 82 Degrees 36 Minutes 00 Seconds West a distance of 120.00 feet; thence North 50 Degrees 47 Minutes 39 Seconds West a distance of 87.83 feet; thence North 23 Degrees 23 Minutes 22 Seconds West a distance of 67.12 feet; thence South 88 Degrees 44 Minutes 00 Seconds East a distance of 188.87 feet; to the True Point of Beginning of this Exception. B: Beginning at the Southeasterly corner of Parcel. A, as shown on the certain Parcel Map recored July 17th 1973 in book 326 of Maps at page 43, Santa Calra County Records; thence along the South line of that certain 1 .53 acre tract of land as described in the Deed recorded in Book K 444 page 200, official records of Santa Clara County, South 88 Degrees 44 Minutes 00 Seconds East a distance of 291.33 feet; thence South 10 Degrees 21 Minutes 00 Seconds West a distance of 250.25 feet; thence South 74 Degrees 12 Minutes 00 Seconds West a distance of 265.40 feet; thence North 01 Degrees 36 Minutes 00 Seconds East a distance of 325.00 feet to the point of begining of Parcel 3 as described in Certifacar-e of Compliance recorded October 21, 1997, under Recorder's Series No. 1390408c, Official Records. C: Beginning at the Southeast corner of the Northeast quarter of the Southwest quarter of Section 8, Township 9 South, Range 1 West, M.D.B.&M., thence West 256 feet; thence North 6' 45' West a disance of 700 feet; thence North 59' 20' East, a distance 101 feet; thence North 1' 10' East a distance of 188 feet; thence North 77' 30' East a distance of 254 feet; thence South a distance cf 993 feet to the point of beginning. (544-35-35) TOGETHER WTTE the following Parcel: Beginning at a 3/4" iror, pipe found in C'he cerl--er line of Cul-de-sac of old We1j. Road said point also being the most Northerly corner of Parcel C, as shown cn that certain parcel Map recorded on July 17, 1973 in Book 326 of Maps at page 43, Santa Clara County Records. Thence South 05 Degrees 58 Minutes 03 Seconds West a distance of 42.00 feet; thence South 43 Degrees 19 Minutes 27 Seconds West a distance of 53.23 feet; thence South 53 Degrees 03 Minutes 39 Seconds West a distance of 102.88 feet; thence South 57 Degrees 22 Minutes 48 Seconds West a distance of 139.52 feet; thence South 13 Degrees 30 Minutes 46 Seconds West a distance of 192. 14 feet; thence South 17 Degrees 35 Minutes 58 Seconds East a distance of 84.31 feet; thence North 88 Degrees 44 Minutes 00 Seccnds West a distance of 75.00 feet' ta a -found 3/4" ircn pipe; thence North 13 Degrees 31, min,,;tes 45 Seconds East a distance of 291- 14 feet to a found 3/4" iron pipe; thence *forth 53 Degrees 09 Minutes 56 seconds East a distance of 333-58 feet to the point of Beginning of this portion of land described herein, as described on the Certificate recorded August 23, 1995 in Book N970, Official Records, Page 2043. MTDPENTNSULA REGIONAL OPEN SPACE DISTRICT RESOLUTION NO. 03-09 A RESOLUTION OF THE BOARD OF DIRECTORS OF MIDPENINSULA REGIONAL OPEN SPACE DISTRICT PROVIDING FOR THE ISSUANCE AND DELIVERY OF THE MIDPENINSULA REGIONAL OPEN SPACE DISTRICT 2003 PROMISSORY NOTE WHEREAS, the Board of Directors (the "Board") of the Midpeninsula Regional Open Space District (the"District") has found and determined that it is necessary and proper for the purpose of implementing the District's plan to acquire necessary and proper lands and facilities for open space purposes of the District that the District acquire certain land more particularly described in Exhibit A attached hereto and incorporated herein (the "Land") currently owned by P. Michael Hunt and Sherry L. Hunt, as co-trustees of the Hunt Living Trust dated February 14, 1996 (the "Sellers"), by the purchase on contract of the Land from the Sellers; and WHEREAS, Section 5544.2 of the Public Resources Code of the State of California authorizes the issuance and delivery by the District of a promissory note to evidence the indebtedness to be incurred by the District for the purchase on contract of the Land from the Sellers, and the Board has determined to issue and deliver to the Sellers, and the Sellers have agreed to accept from the District, a promissory note (the 'Note") issued under such section in the principal amount of one million five hundred thousand dollars ($1,500,000) to evidence the indebtedness to be incurred by the District for the purchase on contract of the Land from the Sellers; and WHEREAS, it is necessary and proper for the District to adopt this resolution in order to provide the conditions and terms under and pursuant to which the Land will be purchased on contract by the District and the Note will be issued and delivered by the District to the Sellers; NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of Midpeninsula Regional Open Space District as follows: Section 1. The Board has reviewed all proceedings heretofore taken relative to the purchase on contract of the Land from the Sellers and the issuance and delivery to the Sellers of the Note to evidence the indebtedness to be incurred for the purchase on contract of the Land from the Sellers, and the Board has found, as a result of such review, and hereby finds and determines that all acts, conditions and things required by law to exist, happen and be performed precedent to the purchase on contract of the Land from the Sellers and the issuance and delivery to the Sellers of the Note to evidence the indebtedness to be incurred for the purchase on contract of the Land from the Sellers have existed, happened and been performed in regular and due time, form and manner as required by law, and the District is now duly authorized to purchase on contract the Land from the Sellers and to issue and deliver to the Sellers the Note to evidence the indebtedness to be incurred for the purchase on contract of the Land, all as provided in this resolution. Section 2. The District determines to issue and deliver to the Sellers the Note to evidence such indebtedness, which Note shall be numbered R-1, shall be designated the "Midpeninsula Regional Open Space District 2003 Promissory Note," shall be dated April 1, 2003, shall mature (subject to prior redemption as hereinafter provided) on April 1, 2023, and shall bear interest at the rate of five and one-half per cent (5-1/2%) per annurn from the date of delivery of the Note until April 1, 2013, or the prior redemption of the Note(if redeemed prior to such date), and thereafter at the rate of five per cent (5%) per annurn from such date until the maturity or the prior redemption of the Note, payable on October 1, 2003, and semiannually thereafter on April I and October I of each year and on the maturity or prior redemption of the Note. All interest on the Note shall be computed on the basis of a 360-day year of twelve (12)thirty-day calendar months and shall be payable in lawful money of the United States of America by the Treasurer of the District (the "Treasurer") at the office of the District in Los Altos, California, by check mailed by such officer on each interest payment date payable to the order of the Sellers, or registered assigns, except that the final payment of such interest shall be payable only on presentation and surrender of the Note to the Treasurer at the office of the District in Los Altos, California, at the maturity or the prior redemption of the Note, and the principal of the Note shall be payable in like lawful money on the maturity date or prior redemption date thereof upon surrender of the Note to the Treasurer at the office of the District in Los Altos, California. The registered owners of the Note may, at their option, require the District to prepay the Note in full on any date on or after April 1, 2008, upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of the Note, plus the accrued interest thereon, less a discount of nine-tenths of one per cent (9/10 of 1%) of the outstanding principal amount of the Note for each whole year remaining between the date of redemption and April 1, 2013 (and prorated for any partial year remaining in such period) if the redemption is on or prior to April 1, 2013, or with no discount if the redemption is after April 1, 2013; provided, that if at any time the interest payable on the Note is determined not to be excluded from gross income for federal income tax purposes or to be a specific preference item for purposes of federal income taxes under the Internal Revenue Code of 1986 (the "Code") or not to be exempt from State of California personal income taxes by any federal or state court or any ruling or regulation (final, temporary or proposed) or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or state authority affecting the federal or state tax status of the District or the interest on municipal bonds or notes, the registered owners of the Note may, at their sole option, require the District to prepay the Note in full on any date upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of the Note, plus the accrued interest thereon. The Note, together with the accrued interest thereon, shall become due and payable on any date designated by the registered owners of the Note not earlier than ten (10) days after notice thereof is given by the registered owners of the Note to the District, upon the occurrence of either of the following two events: (a) a default by the District in the payment of any interest on or principal of the Note when due which has not been cured within ten (10) days of written notice of such default by the registered owners of the Note to the District; or (b) a default in the performance by the District of any obligation or covenant of the District contained in the Note which has not been cured within ten (10) days of written notice of such default by the registered owners of the Note to the District; and in any such event, such delinquent payments shall bear interest from the date they became due until paid at the then applicable rate of interest on the Note, plus five per cent (5%) per annum. Section 3. The Note and the registration endorsement to appear thereon shall each be in substantially the following forms, the blanks in said forms to be filled in with appropriate words or figures, namely: [FORM OF NOTE] UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTIES OF SANTA CLARA, SAN MATEO AND SANTA CRUZ MIDPENINSULA REGIONAL OPEN SPACE DISTRICT 2003 PROMISSORY NOTE No.R-1 $1,500,000 Dated: April 1,2003 Date of Delivery: April_,2003 The MIDPENINSULA REGIONAL OPEN SPACE DISTRICT, a regional open space district located in the Counties of Santa Clara, San Mateo and Santa Cruz, State of California (the "District"), hereby acknowledges itself indebted and for value received promises to pay to the order of P. Michael Hunt and Sherry L. Hunt, as co-trustees of the Hunt Living Trust dated February 14, 1996, or registered assigns, on April 1, 2023 (subject to prior redemption as hereinafter provided), the principal sum of ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,000) together with interest thereon at the rate of five and one-half per cent (5-1/2%) per annurn from the date of delivery hereof until April 1, 2013, or the prior redemption hereof(if redeemed prior to such date), and thereafter at the rate of five per cent (5%) per annurn from such date until the maturity or the prior redemption hereof, payable on October 1, 2003, and semiannually thereafter on April I and October I of each year and on the maturity or prior redemption of this Note. All interest on this Note shall be computed on the basis of a 360-day year of twelve (12) thirty-day calendar months and shall be payable in lawful money of the United States of America by the Treasurer of the District(the"Treasurer") at the office of the District in Los Altos, California, by check mailed by such officer on each interest payment date payable to the order of the registered owners hereof, or registered assigns, except that the final payment of such interest is payable only on presentation and surrender of this Note to the Treasurer at the office of the District in Los Altos, California, at the maturity or the prior redemption hereof, and the principal of this Note is payable in like lawful money on the maturity date or prior redemption date hereof upon surrender of this Note to the Treasurer at the office of the District in Los Altos, California. This Note is the sole note of a duly authorized issue of promissory notes of the District aggregating one million five hundred thousand dollars ($1,500,000), and is authorized to be issued pursuant to the conditions and terms of a resolution adopted by the affirmative vote of at least two-thirds (2/3) of the members of the Board of Directors of the District duly and regularly passed and adopted on March 12, 2003, under and by authority of Section 5544.2 of the Public Resources Code of the State of California. The registered owners of this Note may, at their option, require the District to prepay this Note in full on any date on or after April 1, 2008, upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the outstanding principal amount of this Note, plus the accrued interest thereon, less a discount of nine-tenths of one per cent (9/10 of 1%) of the outstanding principal amount of this Note for each whole year remaining between the date of redemption and April 1, 2013 (and prorated for any partial year remaining in such period) if the redemption is on or prior to April 1, 2013, or with no discount if the redemption is after April 1, 2013; provided, that if at any time the interest payable on this Note is determined not to be excluded from gross income for federal income tax purposes or to be a specific preference item for purposes of federal income taxes under the Internal Revenue Code of 1986 or not to be exempt from State of California personal income taxes by any federal or state court or any ruling or regulation (final, temporary or proposed)or official statement on behalf of the United States Treasury Department, the Internal Revenue Service or other federal or state authority affecting the federal or state tax status of the District or the interest on municipal bonds or notes, the registered owners of this Note may, at their sole option, require the District to prepay this Note in full on any date upon thirty (30) days' prior written notice delivered to the Treasurer at the office of the District in Los Altos, California, at a price of one hundred per cent (100%) of the principal amount of this outstanding principal amount of this Note, plus the accrued interest thereon. This Note, together with the accrued interest thereon, shall become due and payable on any date designated by the registered owners of this Note not earlier than ten (10) days after notice thereof is given by the registered owners of this Note to the District, upon the occurrence of either of the following two events: (a) a default by the District in the payment of any interest on or principal of this Note when due which has not been cured within ten (10) days of written notice of such default by the registered owners of this Note to the District; or (b) a default in the performance by the District of any obligation or covenant of the District contained herein which has not been cured within ten (10) days of written notice of such default by the registered owners of this Note to the District; and in any such event, such delinquent payments shall bear interest from the date they became due until paid at the then applicable rate of interest on this Note, plus five per cent (5%) per annum. It is hereby certified, recited and declared that this Note is issued and delivered in strict conformity with the Constitution and laws of the State of California now in force and with the proceedings of the Board of Directors of the District authorizing the same, and that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance and delivery of this Note have existed, happened and been performed in regular and due time, form and manner as required by law, and that this Note, together with all indebtedness and obligations of the District, does not exceed any limit prescribed by the Constitution or statutes of the State of California, and that the interest on and principal of this Note is payable from limited ad valorem property taxes levied upon all taxable property within the District by the Board of Supervisors of Santa Clara County and by the Board of Supervisors of San Mateo County that are allocated to the District under applicable law; provided, that the repayment of this Note shall be junior and subordinate to all outstanding and subsequent notes, bonds, leases or other obligations secured by property tax revenues of the District or subsequent pledges of revenues created by the District for the purpose of financing the District's purposes or operations. IN WITNESS WHEREOF, the District has caused this Note to be signed by the President of its Board of Directors and attested by the Secretary of its Board of Directors, and has caused the seal of the District to be affixed thereto, and has caused this Note to be dated April 1, 2003. P �ident of the Board of Directors of Midpeninsula Regional Open Space District [SEAL] Attest: Secretary of the Board of Directors of Midpeninsula Regional Open Space District [FORM OF ASSIGNMENT TO APPEAR ON NOTE] For value received the undersigned do hereby sell, assign and transfer unto the within Note and do hereby irrevocably constitute and appoint attorney to transfer the same on the note register of the District, with full power of substitution in the premises. Dated: SIGNATURE GUARANTEED BY: Note: The signatures to this Assignment must correspond with the names as written on the face of the within Note in every particular, without alteration or enlargement or any change whatsoever, and the signatures must be guaranteed by an eligible guarantor institution. Social Security Numbers, Taxpayer Identification Numbers or other identifying number of Assignees: Section 4. The President of the Board is hereby authorized and directed to manually execute the Note, and the Secretary of the Board is hereby authorized and directed to manually attest such execution of the Note and to affix the seal of the District thereto. Such signing, attesting and sealing as herein provided shall be a sufficient and binding execution of the Note by the District, and if either officer of the Board whose signature appears on the Note ceases to be such officer before the delivery of the Note, the signature of such officer appearing on the Note shall be valid and sufficient for all purposes to the same extent as if such officer had remained in office until the delivery of the Note. Section 5. For the purpose of paying the interest on and the principal of the Note, the District shall, until the interest on and the principal of the Note shall have been paid in full or until there is a sum in the treasury of the District set apart for that purpose sufficient to meet all payments of the interest on and the principal of the Note as they shall become due and payable, annually set aside a portion of the limited ad valorem taxes levied upon all taxable property within the District by the Board of Supervisors of Santa Clara County and by the Board of Supervisors of San Mateo County that are allocated to the District under applicable law(or other available funds of the District), sufficient to pay such interest and principal that will become due before the proceeds of a tax levied at the next general tax levy will be available; provided, that the repayment of the Note shall be junior and subordinate to all outstanding and subsequent notes, bonds, leases or other obligations secured by property tax revenues of the District or subsequent pledges of revenues created by the District for the purpose of financing the District's purposes or operations. Such taxes (or other available funds of the District) shall be deposited by the Treasurer in a special account maintained by him which shall be designated the "Midpeninsula Regional Open Space District 2003 Promissory Note Account" (the "Note Account"), and all money in the Note Account shall be used solely for the payment of the interest on and the principal of the Note. All money in the Note Account shall, pending its disbursement and consistent with Section 6 hereof, be deposited or invested as permitted by law so as to obtain the highest yield that the Treasurer deems practicable, having due regard for the safety of such deposits and investments; provided that all such deposits and investments shall be withdrawable or shall mature, as the case may be, to coincide as nearly as practicable with the time when such money is required for disbursement hereunder, and any proceeds thereof shall be deposited in the Note Account. When the interest on and principal of the Note has been paid, any balance of money then remaining in the Note Account shall be used for any lawful District purpose. Section 6. The District will not take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of the interest on the Note pursuant to Section 103 of the Code, and specifically the District will not directly or indirectly use or make any use of the proceeds of the Note or any other funds of the District or take or omit to take any action that would cause the Note to bean "arbitrage bond" subject to federal income taxation by reason of Section 148 of the Code or a "private activity bond" subject to federal income taxation by reason of Section 141(a) of the Code or an obligation subject to federal income taxation because it is "federally guaranteed" as provided in Section 149(b) of the Code; and to that end the District, with respect to the proceeds of the Note and such other funds, will comply with all requirements of such sections of the Code (and all regulations of the United States Department of the Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect); provided, that if the District shall obtain an opinion of nationally recognized bond counsel to the effect that any action required under this section is no longer required to maintain the exclusion from gross income of the interest on the Note pursuant to Section 103 of the Code, the District may rely conclusively on such opinion in complying with the provisions hereof, and provided furt her, that in the event that at any time the Board is of the opinion that for purposes of this section it is necessary to restrict or limit the yield on the investment of any moneys held by the District hereunder or otherwise, the Board shall so instruct the Treasurer in writing, and the Treasurer shall take such action as may be necessary in accordance with such instructions. Without limiting the generality of the foregoing, the District will pay from time to time all amounts required to be rebated to the United States of America pursuant to Section 148(f) of the Code and all regulations of the United States Department of Treasury issued thereunder to the extent that such regulations are, at the time, applicable and in effect, which obligation shall survive payment in full or defeasance of the Note, and to that end, there is hereby established in the treasury of the District a fund to be known as the "Nudpeninsula Regional Open Space District 2003 Promissory Note Rebate Fund" to be held and administered by the Treasurer. The District will comply with the provisions of the Tax Certificate with respect to making deposits in the Rebate Fund, and all money held in the Rebate Fund is pledged to provide payments to the United States of America as provided herein and in the Tax Certificate and no other person shall have claim to such money except as provided in the Tax Certificate. Section 7. The Secretary of the Board is directed to cause the Note to be prepared to comply with the provisions hereof, and to procure its execution by the proper officers of the Board, and to deliver it, when so executed, to the Treasurer, who shall deliver it on or after its date to the Sellers at the time that the District purchases on contract the Land from the Sellers. The President of the Board and the Secretary of the Board are further authorized and directed to make, execute and deliver to the Sellers a signature certificate in the form customarily required by purchasers of notes of public districts, certifying to the genuineness and due execution of the Note, and the Treasurer is hereby authorized and directed to obtain from the Sellers at the time of the purchase on contract of the Land a receipt for the Note in the form customarily required from purchasers of notes of public districts, evidencing the delivery of the Note, which receipt shall be conclusive evidence that the Note has been duly delivered; and Sellers and any subsequent registered owners of the Note are hereby authorized to rely upon and shall be justified in relying upon any such signature certificate and any such receipt with respect to the Note issued and delivered pursuant to the authority of this resolution. Section S. This resolution shall take effect from and after its passage and approval. PASSED AND ADOPTED this 12th day of March, 2003, by the following vote: AYES: N. Hanko, P. Simms, D. L ttte, J. Cytc, M. Davey, L. Hazzett, K. Nitz NOES: none AB : none APPROVED: P esident of the Board of Directors of Midpeninsula Regional Open Space District A ST. Secr ary of the Board f Dire s of peninsula Regional Open Space District 4 i SECRETARY'S CERTIFICATE I, Kenneth C.Aitz Secretary_ of the Board of Directors of Midpeninsula Regional Open Space District, do hereby certify that the foregoing is a full, true and correct copy of a resolution duly adopted at a regular meeting of the Board of Directors of said District duly and regularly and legally held at the regular meeting place thereof on the 12th day of March, 2003, by the affirmative vote of at least two-thirds of the members of said Board, of which meeting all of the members of said Board had due notice and at which meeting at least two-thirds thereof were present and acted; that at said meeting said resolution was, upon motion of Director J. Ctj't , seconded by Director D. Litt e , adopted by the following vote: AYES: N. Hanko, L. Hazsett, M. Davey, J. Cytc, P. Siemen6, D. Lithe, K. N,ctz NOES: none ABSENT: none I do hereby further certify that I have carefully compared the same with the original minutes of said meeting on file and of record in my office, and that said resolution is a full, true and correct copy of the original resolution adopted at said meeting and duly entered of record in said minutes, and that said resolution has not been amended, modified or rescinded since the date of its adoption and the same is now in full force and effect. WITNESS my hand this 12thday of March, 2003. Secre of the Board ofDire ors of peninsula Regional Open pace District EXHIBIT A [Legal Description of the Land] All that certain real property situate in the unincorporated area of Santa Clara County, California, described as follows" PARCEL ONE: The North half of the Southwest quarter of Section 8, Township 9 South, Range 1 West, Mount Diablo Base and Meridian, according to the United States Government Survey therof. EXCEPTING THEREFROM the following described parcels of land: A: Beginning at a 3/4" iron pipe found at the South East corner of Parcel C, as shown on that certain Parcel Map recorded on July 17, 1973 in Book 326 of Maps at page 43, Santa Clara County Recorded; Thence North 83 Degrees 44 Minutes 00 Seconds West a distance of 20.07 feet to the true Point of Beginning of this Exception; thence South 43 Degrees 49 Minutes 43 Seconds East a distance of 28.33 feet thence South 02 Degrees 47 Minutes 22 Seconds East a distance of 105.09 feet; thence North 82 Degrees 36 Minutes 00 Seconds West a distance of 120.00 feet; thence North 50 Degrees 47 Minutes 39 Seconds West a distance of 87.83 feet; thence North 23 Degrees 23 Minutes 22 Seconds West a distance of 67.12 feet; thence South 88 Degrees 44 Minutes CO Seconds East a distance of 188.87 feet; to the True Point of Beginning of this Exception. B: Beginning at the Southeasterly corner cf Parcel. A, as shown on the certain Parcel Map recored July 17th 1973 in book 326 of Maps at page 43, Santa Calra County Records; thence along the South line of that certain 1.53 acre tract of land as described in the Deed recorded in Book K 444 page 200, official records of Santa Clara County, South 88 Degrees 44 Minutes 00 Seconds East a distance of 291.33 feet; thence South 10 Degrees 21 Minutes 00 Seconds West a distance of 250.25 feet; thence South 714 Degrees 12 Minutes 00 Seconds West a distance of 265.40 feet; thence North Cl Degrees 36 Minutes 00 Seconds East a distance of 325.00 feet to the point of begining of Parcel 3 as described in Certifacal:e of Compliance recorded October 21, 1997, under Recorder's Series No. 13904080, Official Records. C: Beginning at the Southeast corner of the Northeast quarter of the Southwest quarter of Section 8, Township 9 South, Range I West, M.D.B.&M., thence West 256 feet; thence North V 45' West a disance of 700 feet; thence North 53' 201 East, a distance 101 feet; thence North 1' 10' East a distance of 188 feet; thence North 77' 30' East a distance of 254 feet; thence South a distance of '393 feet to the point of beginning. (544-33-35) TOGETHER WITH the following Parcel: Beginning at a 3/4" iron pipe o-und In the ctn'-er liae of cu!-,-Ie-sat:: o: cizi We.._I Road said point also being the most Northerly corner of Parcel C, as shown on that certain parcel Map recorded on July 17, 1973 in Book 326 of Maps at page 43, Santa Clara County Records. Thence South 05 Degrees 58 Minutes 03 Seconds West a distance of 42.00 feet; thence South 43 Degrees 19 Minutes 27 Seconds West a distance of 53,23 feet; thence South 53 Degrees 03 Minutes 39 Seconds West a distance of 102.88 feet; thence South 57 Degrees 22 Minutes 48 Seconds West a distance of 139.52 feet; thence South 13 Degrees 30 Minutes 46 Seconds West a distance of 192.14 feet; thence South 17 Degrees 35 Minutes 58 Seconds East a distance of 84.31 feet; thence North 88 Degrees 44 Minutes 00 S ac:,-.ds W as z- a distance of 75.00 feet' to a found 3/4" -Jrcn pipe; thence North 13 Degrees 3.1 min�;tes 45 Seconds East a distance of 291-14 feet to a found 3/4" iron pipe; thence North 53 Degrees 09 Minutes 56 seconds East a distance of 333 .58 feet to the Point of Beginning of this portion of land described herein, as described on the Certificate recorded August 23, 1995 in Book N970, Official Records, Page 2043.