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CITY OF SOUTH EUCLID. OHIOOctober 26- 2OO9

ORDINANCE NO. : 50-09INTRODUCED BY: RomeoREQUESTED BY: Ma-vorAN ORDTNANCE

AN ORDTNANCE PROVIDINC FOR THE ISSUANCE AND SALE OF SI ,SOO,OOOOTES. INANTICIPATION OF THE ISSUANCE OF BONDS. FOR THE PURPOSE OF PAYTNG COSTSOF ACQUIRING CERTAIN REAL PROPERTY AND CLEARING AND OTHER\VISEIMPROVINC THE SITE THEREOF TO PROVIDE OR ASSIST TN PROVIDING HOUSTNC.AND DECLARING AN EMERGENCY.WHEREAS, the City is authorized and emporvered by virtue of the laws of the State of Ohio,including, without limitation, Section l6 of Article VIII of the Ohio Constirution and Section133.51 of the Ohio Revised Code. among other things, (a ) to issue bond anticipation notes andbonds for the purpose of providing or assisting in providing housing; (b) to secure such notes andbonds by nontax revenues, as provided herein; and (c) to enact this Ordinance, upon tl-le erms andconditions provided herein; an dWHEREAS, for the purpose of providing or assisting in providing housing, the City, pursuant toOrdinance No. 8l-06 passed on November 13,20O6 purchased, pursuant to Article VtlI, Section16 oF the Ohio Constirution, certain real estate and the buildings thereon, and cleared andotherwise improved the site thereof, in order, as presently intended by the City, to make it suitablefor sale or lease to a developer or developers for deve lopment of residentia l facil ities, therebyenhancing the availability of adequate housing in, and improving the econornic and general well-being of the residen ts ot-, the City; andWHEREAS, pursuant to Ordinance No. 59-07 passed November 12,2OQ7 a note in arrticipationof the issuance of bonds in the arnount of Sl,8OO,OOO, ated Decernber 20,2OO7, was issued fo rthat purpose as stated n Section 2, to mature on Dec ernber 18, 2OO8 th e Outstanding Note); an dWHEREAS, this Council finds and detennines that the City should retire the Outstanding Notewitl'r the proceeds of the notes described in Section 3; andWHEREAS, the Director of Finance, as t-rscaloft-rcer of this City, has certified to this Council thatthe estimated life or period of usefulness of the project described in Section 2 is at least five years,the estimated maximum maturity of the bonds described in Section 2 is at least twenty years, andthe maximum marurity of the notes described in Section 3, to be issued in anticipation of thebonds, is Decernber 27, 2Q26'.

NOW, THEREFORE, BE IT ORDAINED by the Courncil of the City of SouthEr.rclid, County of Cuyahoga, State of Ohio, that:Section l: tn addition to the words and terms defined elsewhere in this Ordinance, unless th econtext or use clearly indicates another meaning or intent:

"Holder" means the Original Purchaser as the initial owner of the Notes (as defined inSection 3 ) or, in the event of transfer thereof, any subsequent person who is the owner of the Notes."Nonta-\ Revenues" means all moneys of the City which are not moneys raised bytaxation, to the extent available fbr the purpose of paying Note service charges. including, but notlimited to the tbllowing: (a) proceeds from the sale or lease of all or a portion of the Project Site;(b) grants frorn the United States of America and the State; (c) t-rnes and forfeitures which aredeposited in the City's General Fund; (d) fees deposited in the City's General Fund for servicesprovided and l}om properly imposed licenses and permits; (e) inveshnent earnings on the City'sGeneral Fund; (t) investment eamings on other funds of the City that are credited to the City'sCeneral Fund; (g) proceeds frorn the sale of assets rvhich are deposited in the City's GeneralFund: (l-r) gifts and donations; (i ) all rental payments which are deposited in the City's CeneralFund; and () rny moneys in the fund for the Project into which the proceeds of the Notes aredeposited and which are not needed to pay costs of the Project."Note service charges" rneans, for any period of time, the principal of and inte;estrequired to be paid by the City on the Notes (as defined in Section 3) for such time period."Original Purchaser" means KeyBank National Association, or such other entity orentities as may be designated by the Director of Finance in the Certificate of Award.

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- 2 -. "Proj_ect" lrteans acquiring. clearing and otherwise improving the Project Site, fbr saleor lease o a developer or developers tbr development of residentiat t-acit it ies. -*Project Site" means that certain real estate and the buildings thereon as described inOrdinance No. 8l-06 passed by tl-reCouncil on Novernber 13,20O6 authorizing th e purchasethereof pursuant to Article VIII. Section l6 of the Ohio Constirution.

Any reference herein to th e City. to this Council, or to any officer or member ofeither, irrcludes entit ies or oft icials succeeding to their respective functions, dr.rt ies orresponsibil it ies pursuant to or by operation of la',voi larvftrl ly perfonning their functions.Any ret-erence o a section or provision of th e Constitution of the State, or to asection, pro.vision or chapter of the Ohio Revised Code, includes that section, provision or chapteras atnended, modified,.Levised, sttpplemented or superseded fiorn tirne to t irne: provided, thai nosuch amendmentr rnodif-rcation, evision. supplement or superseding section, provision or chaptershall-b-e pplica_ble olely by reason of this provision if it constitutes in any wiy an irnpairmeni ofthe rights or obligations of the City or the Holder of the Notes under this Ordinance, the Notes orany other instrument or docurnent entered into ir-rconnection with any of the foregoing, including,without limitation, any alteration of the obligation to pa y the Note sbrvice charges in the amountand manner, at the times and from the sources provided in this Ordinance, except as pennittedherein.

Secti.on2: This Council determines that (i ) the Project is consistent with th e purposes of Sectionl6 of Article VIII of the Ohio Constitution an d (ii) i i is necessary o issue bonds oTthis City in the6 of Article VIII of the Ohio Constitution an d (ii) i i is necessary o issue of this City in theaggregateprincipal amount of S ,8O0,OOOth e Bonds) for the purpose of paying costs of acquiringggregate pnnclpal amount ot $ I ,800,000 (the Bonds) for the purpose of paying costs of acquir ingcertain. real propeny and clearing and otherwise irrrproving tl're site thereot--to provide or assist inerraun- real pr()perly ancl creanng arlo otnerwlse [nprovrng the slte thereot to provlcle or assrst rnproviding housing. The Bonds shall be dated approxirnately Decernber 1,2OO9, shall bear interestat tlle now estimated,rate

of 8%o per year, payable on June I and December I of each year.comtnencing June l,20lO, until th e principal amount is paid, and are estirnated to matuie in_ , - tBonds in anv yeSr in which principal is payable is substantially equal. The first principalcomlrlenctng June I, rutu, untll In e pnnclpal amount ls palcl, and are estlmated to mature rntwenty .annual _principal installments such that the total principal and interest pa)ments on theBonds in any fiscal year in which principal is oavable is substantiallv eoual. The first nrirrcina linstallment is estimated to be made on December l, 20 I O.Section 3: It is necessqy to issue and this Council determines that notes in th e aggregateprincipal arlount of $ I,8OO,OOOth e Notes) shall be issued in anticipation of the issuance ot--theBonds and to retire the Outstanding Note. The Notes shall bear int-erest at a rate or rates not toexceed 89/o per year (cornputed on th e basis of a 360-day year consisting of twelve 30-daymonths), payable at maturity or at any date of earlier prepayment as provided for in Section 4 anduntil, the principal amount is paid or pay'rnent is provided for. lf requested by the OriginalPurchaser, tl're Notes ryay provide that, in the event the City does not pay or make provision tbrpayment at maturity of the debt charges on the Notes, the principal amount of the Noies shall bearinterest at a different rate or rates not to exceed l}-l /2o/oper year from the maturity date until theCity pays or makes provision to pay that principal amount. The rate or rates of interest on theNotes shall be determined by the Director of Finance in the certif icate awarding the Notes inaccordance with Section 6 (the Certif icate of Award). The Notes shall be designated "HousingDevelopment Special Obligation Notes, Series 2OO8" or such other designation as rnay be settbrth in the Certit icate of Award. The Notes shall be dated the date of issuance and shali matureon e year frorn the date of issuance, provided that the Director of Finance rnay, if it is detenninedto be -necessaryor advisable to the sale of the Notes, establish a maturity date that is up to sevendays less than one year tiom the date of issuance by setting forth that rnatrrrity dbte in theCertif icate of Award.Sgction4: The debt charges on the Notes shall be payable in lawful moneyof the United Statesof America, or in Federal Reserve funds of the United States of Arnerica as deterrnined by th eDirector of Finance in the Certif icate of A'"vard, and shall be payable, without deductioir forservices of the City's paylng agent, at the main oft-rce of KeyBank National Association.Cleveland, Ohio, or at the office of a bank or trust company designated by the Director of Financein the Certit'icate of Award after detennining that the payment ai that bank or trust company lvillnot endanger the funds or securities of the City and that proper procedures and safeguards areavailable fbr that purpose, or at the office of th e Director of Finance if agreed to by the Director ofFinance and the Origjnal Purchaser (the Paying Agent). If agreed to by the Original Purchaser andset forth in the Certif icate of Award, the Notes shall be prepayable withor-rtpenalty or premium atthe option of the City at any time prior to maturity as provided in this Ordinance. Prepa5rmentprior to maturity shall be made by deposit rvith the Paying Agent of the principal arnoLlntof theNotes together with interest accrued thereon to the date of prepa) Tlent. The City's right ofprepqrnent shatl be exercised by mailir-rg a notice of prepayrnent, stating the date of prepaynentand tl-re narne and address of the Paying Agent, by certified or registered mail to the OriginalPurchaser of th e Notes not less than seven days prior to the date of that deposit, unless that noticeis waived by the Original Purchaser of the Notes. If money fo r prepayment is on deposit with th ePaytng Agent on the specified prepayment date following th e giving of that notice (unless th erequ.irement of that notice is rvaived as stated above), interest on th e principal amount prepaidshall cease to accrue on the prepayment date, and upon the request of the Director of Finahce the

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- 3 -Original P.urchaserof the Notes shall arrange for the delivery of the Notes at the designated officeof the Paying Agent fbr prepaymenr and surrender and cancejlation.F-Eelienl: The Notes shall be signed by the Mayor and the Director of Finance, in the name ofthe City and in rtreir ottlcial capacities, provided lhat one of those signatr-rresmay be a facsimile.The Notes shall be issued in the denominations and numbers aJ requested by the OriginalPurchaser,and approved by the Director of Finance, provided that no such denomination shaTl beless than St0O,0OO and proviclei further that the entiie principal amount may be represented by asingle note. The entire principal amount may be represented by a single note. The Notes shall nothave coupons attached, shall be numbered'as det-ermined bythe D-irector of Finance and shallexpress u.pon their faces- h_epfrpose, in summary terrns, for-which they are issued and that theyar e issued pLlrsuant o this Ordinance.

Section 6: The Notes shall be sold at not less than par at private sale by the Director of Financeto the Original Purchaser in accordance with law and the provisions of this Ordinance. TheDirector of Finance shall sign the Certificate of Award referred to in Section 3 evidencing thatsale, cause the Notes.to be prepar-ed,and have the Notes signed and delivered, together with i truetranscript of proceejlilS.s ryit! reference to the issuance of-the Notes if requested by the OriginalPurchaser, to the Original_ Purcha.ser upon payrnent of the purchase price. The Mayo{ theDirector of Finance, the Clerk of Council and other City dfficials, as appropriate, aie eachauthorized and directed to sigl any transcript certificaies, financial st'aiernents and otherdocuments and instruments and to take suc[r actions as are necessary or appropriate toconsumrrlate the transactions contemplated by this Ordinance.S,eclign 7: The proceeds from the sale of the Notes, except any premiurn and accrued interest,shall be paid into the proper ftrnd or funds and those procedas are appropriated and shall be rrseclfor tl'r.e urpose for which the Notes are being issued.

-Anyportion ofthose proceeds representingpremium and accrued interest shall be paid into the Bond Retirement Fund. -

Eection8': Th e Notes.and any Bonds issued to retire the Notes shall be special obligations of th eCity, and the Note service charges on the Notes and the debt charges on any Bonds issued to retirethe Notes shall be payable solely frorn the Nontax Revenues, and the pdyment of Note servicecharges is secured by a pledge of and lien on the Nontax Revenues on depoiit in the Note Fund, asdescribed below. The Notes and any Bonds issued to retire the Notes are not and shall not besecured by 1n obligation or pledge of'any money raised by taxation. The Notes and any Bondsissued to retire the Notes do not and shall not represent or constirute a debt or pledge of ihe faittrand credit or taxing power of the City, and the Holder or Holders thereof have-andlhall have noright to have taxes levied by the City for the paynent of Note service charges on the Notes or debtcharges on any Bonds issued to retire the Notes.The City covenants and agrees that while the Notes are outstanding, it willappropriate and maintain Nontax Revenues at such times arrd in such amounts ai will besufficient, together with the proceeds of any Bonds issued to retire the Notes or renewal notes

issled in anticipation of such Bonds available for the purpose (collectively, "renewalobligations"), to pay the Note service charges on the Notes when due and will so iestrict otherobligations payable from Nontax Revenues prior to or on a parity with the Note service charges onth e Notes as will ensure the continuing availabil ity for appropriation of sufficient N-ontaxRevenues to pay Note service charges when due.The par value to be received frorn the sale of any Bonds issued to retire the Notes orof any renewal notes and any excess funds resulting from the issuance of the Notes shall, to theeKtent necessary, be used to pay the Note service charges at marurity and are pledged for thatpurpose. Nothing in this Ordinance shall prevent the City fi'om retiring all or any portion of theNotes with th e proceeds from the sale or lease of all or a portion of the Project Site, with otheravailable cash, with the proceeds of bond anticipation notes, or with the proceeds of bonds orother obligations containing terrns different than those described in this Ordinance.There is created by the City a separate fund or account designated as the "HousingDevelopment Special Obligation Note Retirement Fund" (the "Note Fund") into which NontaxRevenues shall be deposited on or prior to the date of maturity of the Notes in an amountsufficient to pay Note service charges.Nothing herein shall be con strLled as requiring the City to use or apply to thepa) Tlent of Note service charges on the Notes any funds or revenues fiorn any source other thanNontax Revenues and the proceeds of any renewal obligations. Nothing herein, however, shallbe deerned to prohibit th e City, of its orvn volit ion, from using, to the extent that it is authorizedby law to do so, any other resources tbr the fulf i lhnent of any of the tenns, conditions orobligations of this Ordinance or of the Notes.

Section 9: In addition to otl ler representations and warranties of th e City contained in thisOrdinance, the City covenants and agrees that:(a) Pavment of Note Service Charees. The City will, solely frorn the NontaxRevenue and the pr-oceedsof any renewal obligations, pay or cause to be paid the Note service

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charges on the dates, at the places an d in the manner provided herein and in the Notes. Fo r thatpurpose, in each year lvhile th e Notes are outstanding, this Council, after providing for thepa) nent of debt c-harges payable on the City's general obligation securities in that year frornsources available for that purpose, will appropriate Nontax Revenues and th e proceeds oF anyrenewal obligations required to pay, and for the purpose of paying, the Note service charges due ihthat ye-ar..Furtl-rer, hi s Council wil l give effect to such appropriations in all ordinances it passesthereafter in that year appropriating money tbr expenditui

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- 5 -exc.essearnings as rebate, or obviating those amounts or pa) nents, as detennined by that ot.t-icer,which action shall be in writ ing an g iigned by th e offic6r,-(-b) to take any and all 6ther actior-rs.make or obtain calcu.lation^s, qakg payments, and make or give reports, covenallts andcertif ications of and on behalf of th e Citv, -asmay be appropriate to a-ssurehe exclusion of interestfrorn gross income and the intended iax status of^ the'Notes, and (c) to give one or moreappropri-ate-certificates of .the City, for inclusion in the transcript of pioceedings for the Notes,setting.forth -the, reason-able expectations of the Ciry regarding the imount utid ,.rs" of al l tl-reproceeds of the Notes, the facts, circumstances and eitim-ates oi which they are based, and otherfacts and circumstances relevant to the tax treatment of the interest o.t ani the tax status of theNotes.

Each covenant made in this section rvith respect to the Notes is also made rvithrespect-to all issues any portion of the debt serv'ice on which is paid frorr proceeds of tl-reNotes(and, if dift'erent, the original issue and any refunding issues in a series bf refundings). to theextent such_comPli:nce is necessary to assure exclusion of interest on the Notes fiom grossincotne for federal income tax purposes, and the officers identified above are authorized to-takeactions with respect to those issues as they are authorized in this section to take with respect to theNotes.E-esli-al1--ll: n connection with the issuance. of the Notes, the legal services of Squire, Sanders &pgSnseV L.!.P..as bond co_unsel,are retained pursuant to an e*ngagement etter'which has beendelivered to th^e_Citybythat frnn. Thal engagement letter, and theExEcution thereof bythe Mayor,the Director of Finance, the Director of La*, or any one ot'them, are hereby authorizedl ratit-redLndapproved. In -rend_ering.those egal services, as arr independent contractor and in an attorney-clientr: latio-nship, that f irm shall not exercise any administrative discretion on behalf of this Cit! in th eformulation 9f- prlblic policy, expenditure of public funds, enforcsrnent of laws, ruies andr-egulationsof the State, any county, municipality or other polit ical subdivision, or of ihis City, o.th e execution of public trusts.Qection l2: The Clerk of Council is directed to deliver a certif ied copy of this Ordinance to th eCounty Auditor.Sgslign-l]j This Council determines that al l acts and conditions necessary to be done or performeclby the City or !g laY.e been met precedent to and in the issuing of the Noies in order to rnake themlegal, valid.and binding general obligations of the City have bEen perfbrmed and have been met, orwill at the time of delivery of the !-.{otgshave been pe*brmed and 6ave been rnet, in regr,rlarand due9.a3t required-by-lar'v; that the full faith and credit and taxing power (as described in3ection 9) ofth e City.are.pledged.for.the timely.payrnent of the debt chargEs on theNotes; an d that no statutoryor constitutional l imitation of indebtedness or taxation will have been exceeded in the issuance o-fth e Notes.Sgctlon l4: [t is lTereby&yld an d determined that al l fonnal actions of this Council conceming an dr.el.qling o the p-as_sgge_ofhis Ordinance were taken in an open rneeting of this Council, and th-at alldeliberations of this Council and of any committees that iesulted inlsuch formal aciion rvere inTeeli-ngs_open o th e public in compliance with all legal requirements, including Section 121.22 ofth e Ohio Revised Code.Section l5: This Ordinance is declared to be an emergency measure necessary for the irnmediatep_reservation of the public peacL',health and safety of the City, and for the furiher reason that thisOrdinance is required to be immediately eFtbctive in order to issue and sell the Notes. which isnecessary to-enab_le-theCityto t imely retire th e Outstanding Note an d thereby preserve'its credit;wherefore, this Ordinance slrall be in full force and effeit imrnediately upon its passage andapproval by the Mayor.

Passed this _ day of

Attest:

Keith A. Benjamin, Clerk of CouncilApproved as to fonn:

2009

Approved:Georgine Welo, Mayor