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9.b -ZI Jones Hall Draft 10/24/03 NEW ISSUE - BOOK -ENTRY ONLY RATING: Moody's: Standard & Poor's: ( Insured) See "RATING" herein. In the opinion ofNossaman, Guthner, Knox & Elliott, LLP, Irvine, California ("Bond Counsel"), under existlnh statutes, regulations. rulings and Judicial decisions, and assuming certain representations and compliance with certain covenants and requirements described herein, interest on the Bonds Is excluded from gross income for federal income tax purposes and is not an item of tax preference for purp oses of calculating the federal alternative minimum tax imposed on individuals and corporations. In the further opinion ofBond Counsel, interest on the Bonds is exempt from State of pson eral income tax In addition, the difference between the Issue price of a Bond (the first price at which a substantial amount of the Bonds of a maturity is to 6e sold to the public) and the stated redemption price at matur►ty with respect to the Bond constitutes original issue discount and the amount of original Issue discount that amves to the owner of the nd Is excuded from gross income of such owner for federal income taz purposes, is not on Item of taxpreference for purposes of the federal alternative minimum lax imposed on individuals and corporations, and !s exempt from State of Caltfornla personal income tax See "TAX EXEMPIION" herein with respect to tax consequences with respect to the Bonds. $13.500,000'" City of Redwood City Public Firianc ft Authority Lease Revenue Bands Series 2003 Dated: Date of Delivery Due. January 15, as shown beknv The $13,500,000' City of Redwood City Public Financing Authority Lease Revenue Bonds. Series 2003 (the "Bonds") are being issued by the City of Redwood City Public Financing Authority (the "Authority") to provide funds to (1) refund the Authority's remaining outstanding 1991 Loral Agency Revenue Bonds, Series A (the "1991 Bonds "), (B) finance the acquisition and construction of certain infrastructure improvements, (iii) establish a reserve fund, and (iv) pay certain costs incurred in connection with execution and delivery of the Bonds. Interest represented by the Bonds is payable semiannually on each January 15 and July 15, commencing July 15, 2004. The Bonds are special obligations of the Authority, payable from and secured by Revenues (as defined herein) of the Authority consisting primarily of payments to be made by the City of Redwood City (the "City "). for the right to the use of certain real property and improvements thereon (the "Leased Property ") pursuant to a Subordinate Lease Agreement dated November 1, 2003 (the "Lease Agreement "), by and between the City, as lessee, and the Authority as lessor. The City has covenanted in the Lease Agreement to make the Lease Payments for the Leased Property as provided for therein, to include all such Lease Payments in each of its budgets and to make the necessary annual appropriations for all such Lease Payments. The Bonds will be initially delivered only in book -entry form, registered to Cede & Co. as nominee of The Depository Trust Company, New York, New York ( "DTC "), which will act as securities depository of the Bonds. Interest and principal represented by the Bonds are payable by BNY Western Trust Company, Los Angeles, California, as Trustee, to DTC which remits such payments to its Participants for subsequent distribution to the beneficial owners of the Bonds. See "APPENDIX E - DTC and the Book -Entry System" and "THE BONDS - General." The Bonds are subject to redemption prior to maturity as described herein See "THE BONDS - Redemption." Payment of the principal of and interest with respect to the Bonds when due will be insured by a Municipal Bond Insurance policy to be issued by simultaneously with delivery of the Bonds. [INSURER LOGO] The obligation of the City to make the Lease Payments does not constitute a debt of the City or the State of California or of any political subdivision thereof within the meaning of any Mnstltutional or statutory debt limit or restriction, and does not constitute an obligation for which the City or the State of California is obligated to levy or pledge any form of taxation or for which the City or the State of California has Levied or pledged any forest of taxation. This cover page contains information for reference only. Investors must read the entire Official Statement to obtain information essential in making an informed investment decision. See "RISK FACTORS" for a discussion of factors that should be considered, in addition to the other matters set forth herein, in evaluating the investment quality of the Bonds.