AGENDA MEMORANDUM

Meeting Date: July 14, 2008

From: Fred Morrison, City Attorney

Subject: Resolution authorizing LRMC Refunding Bond Issue 2008

Staff Recommendation:

Staff recommends approval of a resolution authorizing the issuance of refunding bonds as requested by Leesburg Regional Medical Center.

Analysis:

The attached Resolution authorizes the issuance of not to exceed $25,000,000 City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 2008 (the "Series 2008 Bonds"), for the purpose of refunding the City's Auction Rate Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 2001 (the "Series 2001 Bonds"). The City originally issued the Series 2001 Bonds as auction rate securities secured by Ambac Assurance Corporation. However, due to market turmoil, it is in the City's and the hospital’s best interest to refund the Series 2001 Bonds with the proceeds of the Series 2008 Bonds. The Series 2008 Bonds will be issued as variable rate demand bonds, initially bearing a weekly rate of interest, secured by an irrevocable, direct pay letter-of-credit from Regions Bank (the "Letter of Credit"). Upon the issuance of the Series 2008 Bonds, all of the Series 2001 Bonds will be redeemed. The Resolution authorizes the negotiated sale of the Series 2008 Bonds to RBC Capital Markets Corporation and the execution and delivery of a Contract of Purchase related thereto. The Resolution also authorizes the execution and delivery of: (i) a Tenth Supplemental Indenture of Trust between the City and The Bank of New York Mellon Trust Company, N.A., as trustee, authorizing and providing the terms governing the issuance of the Series 2008 Bonds; (ii) a Tenth Supplemental Financing Agreement, between the City and Leesburg Regional Medical Center, Inc., LRMC Home Health Services, Inc. and The Villages Tri-County Medical Center, Inc. (collectively, referred to herein as the "Restricted Group"), whereby the Restricted Group will covenant to make bond payments to the City sufficient to pay debt service on the Series 2008 Bonds; (iii) an Official Statement in connection with the sale and issuance of the Series 2008 Bonds; (iv) a Tax Regulatory Agreement between the City and the Restricted Group providing for the terms and conditions for preserving the exclusion from gross income for federal income tax purposes of interest on the Series 2008 Bonds; and (v) an Escrow Deposit Agreement among the City, the Restricted Group and The Bank of New York Mellon Trust Company, N.A., as escrow agent, providing for the refunding of the Series 2001 Bonds.

The Series 2008 Bonds will not be deemed to constitute a general debt, liability, or obligation, or a pledge of the faith and credit or taxing power of the City, the State of Florida or any political subdivision thereof. The Series 2008 Bonds will be solely payable from the loan payments received from the Restricted Group and funds drawn on the Letter of Credit. The City will not be obligated to repay the bonds under any circumstances and is underwriting the bonds only for the benefit of, and at the request of, LRMC.

Options:

Approve the resolution, or
Such other action as the Commission deems appropriate.

Fiscal Impact: Because the bonds are payable only from proceeds generated by LRMC and are not debts or obligations of the City, there is no fiscal impact to the City from the transaction. LRMC is paying all costs of issuing the 2008 bonds.

Submission Date and Time: 7/9/08 3:08 PM____

Department: __City Attorney______

Prepared by: __Fred Morrison ____

Attachments: Yes_ X__ No ______

Advertised: ____Not Required ______

Dates: __________________________

Newspapers:

_________________________________

Revised 6/10/04

Reviewed by: Dept. Head ________

Finance Dept. _______JB________

Deputy C.M. ________EFS________

Submitted by:

City Manager ___________________

Account No. _________________

Project No. ___________________

WF No. ______________________

Budget ______________________

Available _____________________

RESOLUTION NO. _____

A RESOLUTION OF THE CITY OF LEESBURG, FLORIDA, AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $25,000,000 CITY OF LEESBURG, FLORIDA, HOSPITAL REVENUE REFUNDING BONDS (LEESBURG REGIONAL MEDICAL CENTER PROJECT), SERIES 2008a FOR THE PURPOSE OF FINANCING THE CURRENT REFUNDING OF THE OUTSTANDING CITY OF LEESBURG, FLORIDA AUCTION RATE HOSPITAL REVENUE BONDS (LEESBURG REGIONAL MEDICAL CENTER PROJECT) SERIES 2001; PROVIDING THAT SUCH BONDS SHALL NOT CONSTITUTE A GENERAL OBLIGATION OF THE CITY OF LEESBURG OR THE STATE OF FLORIDA OR ANY POLITICAL SUBDIVISION THEREOF BUT SHALL BE PAYABLE SOLELY FROM REVENUES HEREIN PROVIDED; authorizing and approving a TENTH SUPPLEMENTAL FINANCING AGREEMENT BETWEEN THE CITY AND LEESBURG REGIONAL MEDICAL CENTER, INC., LRMC HOME HEALTH SERVICES, INC. and The Villages Tri-County Medical Center, Inc., and a TENTH Supplemental INDENTURE OF TRUST BETWEEN THE CITY AND THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., AS SUCCESSOR TRUSTEE; AUTHORIZING THE MAYOR OR MAYOR PRO TEM TO AWARD THE SALE OF SAID BONDS TO RBC Capital Markets CORPORATION, ON A NEGOTIATED BASIS AND APPROVING THE CONDITIONS OF SUCH SALE; APPROVING THE FORM AND AUTHORIZING THE EXECUTION AND DELIVERY OF A CONTRACT of PURCHASE WITH RESPECT TO SUCH BONDS; APPROVING THE FORM OF AND AUTHORIzing THE EXECUTION AND DELIVERY OF AN OFFICIAL STATEMENT; APPROVING THE FORM AND AUTHORIZING THE EXECUTION AND DELIVERY OF A TAX REGULATORY AGREEMENT AMONG THE CITY, LEESBURG REGIONAL MEDICAL CENTER, INC., LRMC HOME HEALTH SERVICES, INC. and The Villages Tri-County Medical Center, Inc., AND THE TRUSTEE; APPROVING THE FORM AND AUTHORIZING THE EXECUTION AND DELIVERY OF An ESCROW DEPOSIT AGREEMENT AMONG THE CITY, LEESBURG REGIONAL MEDICAL CENTER, INC., LRMC HOME HEALTH SERVICES, INC. and The Villages Tri-County Medical Center, Inc., AND THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.; PROVIDING CERTAIN FINDINGS WITH RESPECT TO THE FOREGOING; PROVIDING AN EFFECTIVE DATE FOR THIS RESOLUTION; AND PROVIDING CERTAIN OTHER DETAILS WITH RESPECT THERETO.

BE IT RESOLVED by the City Commission of the City of Leesburg, Florida, that:

AUTHORITY.

This Resolution is adopted pursuant to the Constitution of the State of Florida, Chapter 166, Florida Statutes, Part II of Chapter 159, Florida Statutes, and other applicable provisions of law (collectively, the "Act").

DEFINITIONS.

All terms used herein in capitalized form, unless otherwise defined herein, shall have the same meaning as ascribed to them in the Indenture of Trust (the "Original Indenture"), dated as of June 1, 1988, between the City of Leesburg, Florida (the "Issuer"), and The Bank of New York Mellon Trust Company, N.A., formerly, The Bank of New York Trust Company, N.A., as successor to Barnett Bank of Tampa, successor by merger to First Florida Bank, N.A., as trustee (the "Trustee"), as supplemented and amended by the First Supplemental Indenture of Trust (the "First Supplemental Indenture") dated as of November 1, 1991, between the Issuer and the Trustee, the Second Supplemental Indenture of Trust (the "Second Supplemental Indenture") dated as of May 1, 1993 between the Issuer and the Trustee, the Third Supplemental Indenture of Trust (the "Third Supplemental Indenture") dated as of October 1, 1993 between the Issuer and the Trustee, and the Fourth Supplemental Indenture of Trust (the "Fourth Supplemental Indenture") dated as of March 15, 1996 between the Issuer and the Trustee, the Fifth Supplemental Indenture of Trust (the "Fifth Supplemental Indenture") dated as of January 1, 2001 between the Issuer and the Trustee, and the Sixth Supplemental Indenture of Trust (the "Sixth Supplemental Indenture") dated as of August 1, 2002 between the Issuer and the Trustee, the Seventh Supplemental Indenture of Trust (the "Seventh Supplemental Indenture") dated as of June 1, 2003 between the Issuer and the Trustee, the Eighth Supplemental Indenture of Trust dated as of June 1, 2006, as supplemented and amended by the First Supplement to Eighth Supplemental Indenture dated as of January 1, 2008 (the "Eighth Supplemental Indenture") between the Issuer and the Trustee, the Ninth Supplemental Indenture of Trust (the “Ninth Supplemental Indenture”) dated as of March 1, 2006, between the Issuer and the Trustee, and as to be further supplemented and amended by the Tenth Supplemental Indenture of Trust (the “Tenth Supplemental Indenture”) between the Issuer and the Trustee, a proposed form of which is attached hereto as Exhibit "A," or in the Financing Agreement (the "Original Agreement"), dated as of June 1, 1988, among the Issuer, Leesburg Regional Medical Center, Inc. ("LRMC"), and LRMC North, Inc. (which was subsequently merged into LRMC), as supplemented and amended by the First Assumption Agreement and Supplemental Financing Agreement (the "First Supplemental Agreement") between LRMC and LRMC Home Health Services, Inc. ("HHS"), dated as of April 24, 1991, the Second Supplemental Financing Agreement (the "Second Supplemental Agreement") dated as of November 1, 1991 between the Issuer and LRMC and HHS, the Third Supplemental Financing Agreement (the "Third Supplemental Agreement") dated as of May 1, 1993 between the Issuer and LRMC and HHS, the Fourth Supplemental Financing Agreement (the "Fourth Supplemental Agreement") dated as of October 1, 1993 between the Issuer and LRMC and HHS, the Fifth Supplemental Financing Agreement (the "Fifth Supplemental Agreement") dated as of March 15, 1996 between the Issuer and LRMC and HHS, the Sixth Supplemental Financing Agreement (the "Sixth Supplemental Agreement") dated as of January 1, 2001 between the Issuer and LRMC and HHS, the Seventh Supplemental Financing Agreement (the "Seventh Supplemental Agreement") dated as of August 1, 2002 between the Issuer and LRMC and HHS, the Eighth Supplemental Financing Agreement (the "Eighth Supplemental Agreement") dated as of June 1, 2003 between the Issuer and LRMC and HHS, the Ninth Supplemental Financing Agreement (the “Ninth Supplemental Agreement”) dated as of January 1, 2006 among the Issuer and LRMC, HHS and The Villages Tri-County Medical Center, Inc. (“TVRH”), the Amendment to the Financing Agreement and the Sixth Supplemental Financing Agreement (the “Amendment to the Financing Agreement and Sixth Supplemental Agreement”) dated as of March 1, 2006 between the Issuer and the Trustee, and as to be further supplemented and amended by the Tenth Supplemental Financing Agreement (the "Tenth Supplemental Agreement") between the Issuer, LRMC, HHS and TVRH, a proposed form of which is attached hereto as Exhibit "B" to be entered into between the Issuer and LRMC, HHS and TVRH. The Original Indenture as supplemented and amended by the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture, the Fifth Supplemental Indenture, the Sixth Supplemental Indenture, the Seventh Supplemental Indenture, the Eighth Supplemental Indenture, the Ninth Supplemental Indenture and the Tenth Supplemental Indenture is referred to herein as the "Indenture." The Original Agreement as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement, the Fifth Supplemental Agreement, the Sixth Supplemental Agreement, the Seventh Supplemental Agreement, the Eighth Supplemental Agreement, the Ninth Supplemental Agreement, the Amendment to the Financing Agreement and Sixth Supplemental Agreement, and the Tenth Supplemental Agreement is referred to herein as the "Agreement."

FINDINGS.

The Issuer, acting through its City Commission, has found and determined and does hereby declare that:

The Issuer has previously issued its $9,530,000 City of Leesburg, Florida, Refunding and Capital Improvement Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 1988A (the "1988A Bonds") and its $30,465,000 City of Leesburg, Florida, Refunding and Capital Improvement Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 1988B (the "1988B Bonds," and together with the 1998A Bonds collectively referred to herein as the "1988 Bonds") pursuant to the Original Indenture and the Original Agreement for the purpose of making a loan to LRMC and LRMC North, Inc. to finance the cost of the acquisition, construction and installation of certain improvements to the hospital facility known as Leesburg Regional Medical Center (the "1988 Project") and refunding certain outstanding indebtedness.

LRMC North, Inc. was subsequently merged into LRMC. Pursuant to the First Supplemental Agreement, HHS was added to the Restricted Group and became an obligor under the Agreement.

The Original Indenture permits the issuance from time to time of Additional Bonds of the Issuer secured equally and ratably with the 1988 Bonds outstanding under the Original Indenture on the terms and conditions set forth therein.

The Issuer has previously issued its $20,760,000 City of Leesburg, Florida, Capital Improvement Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 1991A (the "1991A Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, and the Original Agreement, as supplemented and amended by the First Supplemental Agreement and the Second Supplemental Agreement, to finance certain renovations and improvements to the hospital facilities known as Leesburg Regional Medical Center (the "LRMC Hospital Facilities"), and to purchase certain equipment therefor, as more particularly described in the Second Supplemental Agreement (the "1991A Project").

The Issuer has also previously issued its $29,020,000 City of Leesburg, Florida, Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 1993A (the "1993A Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture and the Second Supplemental Indenture, and the Original Agreement, as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement and the Third Supplemental Agreement, to finance the refunding of the 1988B Bonds maturing on July 1, 2018 and its $22,730,000 City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 1993B (the "1993B Bonds") pursuant to the Original Indenture as so supplemented and amended and as further supplemented and amended by the Third Supplemental Indenture and the Original Agreement, as so supplemented and amended and as further supplemented and amended by the Fourth Supplemental Agreement, to finance the refunding of the 1991A Bonds maturing July 1, 2011 and July 1, 2021.

The Issuer has also previously issued its $12,515,000 City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 1996A (the "1996A Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture and the Fourth Supplemental Indenture and the Original Agreement, as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement and the Fifth Supplemental Agreement for the purpose of refunding the outstanding 1988A Bonds maturing on or after July 1, 1997 and the outstanding 1988B Bonds maturing on July 1, 2008.

The Issuer has also previously issued its $27,150,000 City of Leesburg, Florida Auction Rate Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 2001 (the "2001 Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture and the Fifth Supplemental Indenture and the Original Agreement, as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement, the Fifth Supplemental Agreement and the Sixth Supplemental Agreement to finance the acquisition, construction and equipping of certain improvements to and renovation of the LRMC Hospital Facilities, as more particularly described in the Sixth Supplemental Agreement (the "2001 Project").

The Issuer has also previously issued its $33,060,000 City of Leesburg, Florida Hospital Revenue Bonds (Leesburg Regional Medical Center Project), Series 2002 (the "2002 Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture, the Fifth Supplemental Indenture and the Sixth Supplemental Indenture and the Original Agreement, as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement, the Fifth Supplemental Agreement, the Sixth Supplemental Agreement and the Seventh Supplemental Agreement to finance the acquisition, construction and equipping of certain improvements to and renovations of the LRMC Hospital Facilities, as more particularly described in the Seventh Supplemental Agreement (the "2002 Project").

The Issuer also previously issued its $43,415,000 City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 2003 (the "2003 Bonds") pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture, the Fifth Supplemental Indenture, the Sixth Supplemental Indenture and the Seventh Supplemental Indenture and the Original Agreement, as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement, the Fifth Supplemental Agreement, the Sixth Supplemental Agreement, the Seventh Supplemental Agreement and the Eighth Supplemental Agreement for the purpose of currently refunding the 1993A Bonds and the 1993B Bonds maturing on or after July 1, 2004.

The Issuer has also previously issued its $75,000,000 City of Leesburg, Florida Hospital Revenue Bonds (The Villages Regional Hospital Project), Series 2006 (the “2006 Bonds”) pursuant to the Original Indenture, as supplemented and amended by the First Supplemental Indenture, the Second Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture, the Fifth Supplemental Indenture, the Sixth Supplemental Indenture, the Seventh Supplemental Indenture, and the Eighth Supplemental Indenture and the Original Agreement as supplemented and amended by the First Supplemental Agreement, the Second Supplemental Agreement, the Third Supplemental Agreement, the Fourth Supplemental Agreement, the Fifth Supplemental Agreement, the Sixth Supplemental Agreement, the Seventh Supplemental Agreement, the Eighth Supplemental Agreement, the Ninth Supplemental Agreement and the Amendment to the Financing Agreement and the Sixth Supplemental Agreement to finance (i) the current refunding of the Sumter County Industrial Development Authority Adjustable Rate Demand Revenue Bonds, Series 2001 (The Villages Tri-County Medical Center, Inc. Project) and (ii) the acquisition, construction and equipping of improvements and expansion to The Villages Regional Hospital (the “2006 Project”).

Pursuant to the Ninth Supplemental Agreement, TVRH was added as a Member of the Restricted Group and became an obligor under the Financing Agreement. The Original Indenture was further supplemented and amended by the Ninth Supplemental Indenture, which deleted provisions requiring deposits to a Depreciation Reserve Fund.

LRMC, HHS and TVRH (referred to herein collectively as the "Borrower") have requested the Issuer to issue its City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project"), Series 2008A (the "2008A Bonds") in an aggregate principal amount of not to exceed $25,000,000, as Additional Bonds under the Indenture for the purpose of making a loan to the Borrower to finance the current refunding of the outstanding 2001 Bonds (the "Refunded Bonds"), which initially financed the 2001 Project. The LRMC Hospital Facilities and TVRH Hospital Facilities are collectively referred to herein as the "Hospital Facilities".

It is in the best interest of the inhabitants of the Issuer to issue the 2008A Bonds as Additional Bonds under the Indenture for the purpose of financing the current refunding of the Refunded Bonds.

The Issuer is authorized under the Act to issue the 2008A Bonds to finance the current refunding of the Refunded Bonds and to issue revenue bonds payable from the sale, operation or leasing of the Hospital Facilities.

Adequate provision has been made in the Agreement and the Indenture for the refunding and redemption of the Refunded Bonds, and for the operation, repair and maintenance of the Hospital Facilities at the expense of the Borrower, and for the payment by the Borrower of amounts sufficient to pay the principal of and interest and, if any, premium on the 2008A Bonds and all costs and expenses relating thereto in the amounts and at the times required.

The 2008A Bonds will initially be additionally secured by a direct pay letter of credit (the “Credit Facility”) issued by Regions Bank.

The Borrower is financially responsible based on the criteria established by the Act, and is fully capable and willing to fulfill its obligations under the Agreement, including the obligation to make payments in installments, in the amounts and at the times required, sufficient to timely discharge the debt service on the 2008A Bonds, the obligation to operate, repair and maintain the Hospital Facilities at the Borrower's own expense and such other obligations and responsibilities as are imposed under the Agreement. The payments to be made by the Borrower to the Issuer and the other security provided by the Agreement, and by the Indenture and the Credit Facility are adequate within the meaning of the Act for the security of the 2008A Bonds.

The Issuer is not obligated to pay the 2008A Bonds except from the proceeds derived from the installment payments made by the Borrower pursuant to the Agreement, proceeds of draws under the Credit Facility or from other amounts or collateral pledged therefor and neither the faith and credit nor the taxing power of the Issuer or of the State of Florida or any political subdivision thereof is pledged to the payment of the principal of, the premium, if any, or the interest on the 2008A Bonds.

The Borrower will not discriminate among its patients due to race, religion or national origin.

RBC Capital Markets Corporation, (the "Original Purchaser") has indicated an intent to offer to purchase the 2008A Bonds pursuant to a Contract of Purchase, in substantially the form attached hereto as Exhibit "C" (the "Purchase Contract").

A negotiated sale of the 2008A Bonds is necessary and is in the best interest of the Issuer for the following reasons: the 2008A Bonds will be special and limited obligations of the Issuer, the debt service of which and other costs and expenses related to the 2008A Bonds shall be payable out of moneys derived by the Issuer from payments to be received under the Agreement; the Borrower will be required to pay all costs of the Issuer in connection with the refunding of the Refunded Bonds which are not paid out of the proceeds of the 2008A Bonds or otherwise and to operate and maintain the Hospital Facilities at its own expense; the cost of issuance of the 2008A Bonds, which must be borne directly or indirectly by the Borrower, is likely to be greater and the time until issuance longer if the 2008A Bonds are sold at public sale by competitive bids than if the 2008A Bonds are sold at negotiated sale, and there is no basis, considering prevailing market conditions, for any expectation that the terms and conditions of a sale of the 2008A Bonds at public sale by competitive bids would be more favorable than at negotiated sale; hospital revenue bonds having the characteristics of the 2008A Bonds are typically sold at negotiated sale under prevailing market conditions; and the Borrower has undertaken substantial negotiations with the Original Purchaser of the 2008A Bonds.

It is in the best interest of the Issuer to authorize the acceptance of the expected offer of the Original Purchaser to purchase the 2008A Bonds in the aggregate principal amount of not to exceed $25,000,000 at a negotiated sale. Prior to the sale of the 2008A Bonds, the Original Purchaser will provide the Issuer with a disclosure statement containing the information required by Section 218.385(6), Florida Statutes. The Purchase Contract shall contain a truth-in-bonding statement required pursuant to Section 218.385, Florida Statutes.

To help facilitate the current refunding of the Refunded Bonds, it is in the best interest of the Issuer to enter into the Escrow Deposit Agreement among the Issuer, the Borrower, and The Bank of New York Mellon Trust Company, N.A. (the “Escrow Deposit Agreement”), a proposed form of which is attached hereto as Exhibit “F.”

Neither the Trustee nor the 2008A Bondholders shall have the right directly or indirectly to require the Issuer to levy ad valorem taxes to pay the 2008A Bonds or to fund the operations of the Hospital Facilities.

The Borrower has represented to the Issuer that no certificates of need from the Agency for Health Care Administration of the State of Florida are required in accordance with Sections 408.031‑.045, Florida Statutes, and Chapter 59C‑1 of the Florida Administrative Code in connection with the issuance of the 2008A Bonds or the refunding of the Refunded Bonds.

AUTHORIZATION AND APPROVAL OF 2008A Bonds.

Subject and pursuant to the provisions hereof and of the Indenture and the Agreement, for the purpose of financing the current refunding of the Refunded Bonds, the issuance of revenue bonds of the Issuer under the authority of the Act as Additional Bonds under the Indenture in the principal amount not to exceed $25,000,000, is hereby authorized.

The Mayor or Mayor Pro Tem is hereby authorized to award the sale of the 2008A Bonds, as requested by the Borrower, provided that the aggregate principal amount of the 2008A Bonds shall not exceed $25,000,000, the 2008A Bonds shall mature not later than July 1, 2031, the 2008A Bonds shall initially bear interest at a Weekly Interest Rate with an initial interest rate of not exceed 5.00%, and the purchase price shall not be less than 98% of the principal amount of the 2008A Bonds, all as approved by the Borrower and set forth in the Purchase Contract.

Such Bonds shall be designated "City of Leesburg, Florida Hospital Revenue Refunding Bonds (Leesburg Regional Medical Center Project), Series 2008A," and shall be subject to payment as provided in the Indenture. Notwithstanding anything contained herein to the contrary, the 2008A Bonds shall not be issued until the conditions precedent to the issuance thereof as Additional Bonds under Article IV of the Original Indenture have been complied with and upon issuance, the 2008A Bonds shall constitute Additional Bonds under the Indenture entitled to the security and benefits thereof.

The 2008A Bonds shall be dated the date of original issuance thereof, shall bear interest from the dated date thereof at rates determined in the manner provided in and payable at the times and in the manner provided in the Tenth Supplemental Indenture. The 2008A Bonds shall mature and be subject to optional and mandatory redemption and optional and mandatory tender for purchase, shall be issued in registered form without coupons, shall be in the denomination or denominations, shall be payable at the place or places and in the manner, shall be executed, authenticated and delivered, shall otherwise be in such form, and subject to such terms and conditions, all as provided in the Purchase Contract, the Official Statement (hereafter defined) and the Indenture.

The 2008A Bonds and the premium, if any, and interest thereon shall not be deemed to constitute a general debt, liability or obligation of the Issuer or a debt, liability or obligation of the State of Florida or any political subdivision thereof, or a pledge of the faith and credit or taxing power of the Issuer, the State of Florida or any political subdivision thereof, but shall be payable solely from the revenues and other collateral provided and pledged therefor in the manner and to the extent provided in the Indenture. The Issuer shall not be obligated to pay the 2008A Bonds or any premium or interest thereon except from the revenues, collateral and proceeds pledged therefor as provided in the Indenture. Neither the Issuer, nor the State of Florida, nor any political subdivision thereof shall be directly, indirectly or contingently obligated to levy or pledge any form of taxation whatsoever for the payment of the 2008A Bonds or to make any appropriation for the payment thereof.

AUTHORIZATION AND APPROVAL OF tenth SUPPLEMENTAL AGREEMENT.

As authorized by and in conformity with the Act, the Original Indenture and the Original Agreement, to provide for additional Bond Payments by the Borrower sufficient to pay the principal of, premium, if any, and interest on the 2008A Bonds and certain other amounts provided therein, to provide certain additional covenants of the Borrower with respect to the 2008A Bonds, the execution and delivery of the Tenth Supplemental Agreement between the Issuer and the Borrower is hereby authorized. The form of the Tenth Supplemental Agreement attached hereto as Exhibit "B" is hereby approved, subject to such changes, insertions and omissions and such filling of blanks as may be made in such form of Tenth Supplemental Agreement and approved by the Borrower and either of the officers of the Issuer executing the same, such execution and delivery to be conclusive evidence of such approval. The Mayor or Mayor Pro Tem of the Issuer and the City Clerk or Assistant City Clerk of the Issuer or their duly authorized alternate officers are hereby authorized and empowered to execute and deliver the Tenth Supplemental Agreement in substantially the form attached hereto, subject to such changes, insertions and omissions and filling of blanks therein as authorized hereby.

APPROVAL AND AUTHORIZATION OF TENTH SUPPLEMENTAL INDENTURE.

In order to provide for the issuance of the 2008A Bonds and the terms thereof, and to supplement and amend the Original Indenture, the execution and delivery of the Tenth Supplemental Indenture between the Issuer and the Trustee is hereby authorized. The form of the Tenth Supplemental Indenture attached hereto as Exhibit "A" is hereby approved, subject to such changes, insertions and omissions and such filling of blanks therein as may be made in such form of Tenth Supplemental Indenture and approved by the Trustee and either of the officers of the Issuer executing the same, such execution and delivery to be conclusive evidence of such approval. The Mayor or Mayor Pro Tem of the Issuer and the City Clerk or Assistant City Clerk of the Issuer or their duly authorized alternate officers are hereby authorized and empowered to execute and deliver the Tenth Supplemental Indenture in substantially the form attached hereto, subject to such changes, insertions and omissions and filling of blanks therein as authorized hereby.

ASSIGNMENT OF tenth SUPPLEMENTAL AGREEMENT.

The Issuer's interest in the Tenth Supplemental Agreement, other than certain reserved rights, shall be assigned by the Issuer to the Trustee under the terms of the Indenture and the Agreement.

APPROVAL OF PURCHASE CONTRACT; DELEGATION OF AUTHORITY.

The form of the Purchase Contract attached hereto as Exhibit "C" is hereby approved, subject to such changes, insertions and omissions and filling of blanks therein, not inconsistent with the terms hereof, as may be made in such form and approved by the officers of the Issuer executing the same, the Borrower and the Original Purchaser, such execution to be conclusive evidence of such approval. Upon receipt from the Original Purchaser of a disclosure statement required pursuant to Section 218.385(6), Florida Statutes, the Mayor or Mayor Pro Tem of the Issuer is hereby authorized to accept the offer of the Original Purchaser to purchase the 2008A Bonds in an aggregate principal amount of not to exceed $25,000,000, subject to the conditions provided in Section 4 above, upon the terms and conditions set forth in the Purchase Contract. The Mayor or Mayor Pro Tem of the Issuer is hereby authorized to execute and deliver the Purchase Contract in substantially the form attached hereto as Exhibit "C," subject to such changes, insertions, omissions and filling of blanks therein, not inconsistent with the terms hereof, as may be approved by the Mayor or Mayor Pro Tem, such execution to be conclusive evidence of such approval, for and on behalf of the Issuer.

APPROVAL OF OFFICIAL STATEMENT; EXECUTION AND DELIVERY OF OFFICIAL STATEMENT.

The Issuer hereby approves the form and content of the Official Statement attached hereto as Exhibit "D." The Mayor or Mayor Pro Tem of the Issuer is hereby authorized to execute, on behalf of the Issuer, the final Official Statement, and in the Mayor's or Mayor Pro Term's sole discretion, may approve any changes, insertions, omissions and filling of blanks therein, such execution to be conclusive evidence of such approval, and such Official Statement is hereby authorized to be used and distributed in connection with the marketing and sale of the 2008A Bonds.

APPROVAL AND AUTHORIZATION OF TAX REGULATORY AGREEMENT.

To provide for and preserve the exclusion from gross income for federal income tax purposes of interest on the 2008A Bonds, the execution and delivery of a Tax Regulatory Agreement among the Issuer, the Borrower and the Trustee in substantially the form attached hereto as Exhibit "E" are hereby authorized and approved. The form of the Tax Regulatory attached hereto as Exhibit "E" is hereby approved, subject to such changes, insertions and omissions and such filling of blanks therein as may be approved by the officers of the Issuer executing the same, such execution to be conclusive evidence of such approval. The Mayor or Mayor Pro Term of the Issuer and the City Clerk or the Assistant City Clerk or their duly authorized alternate officers are hereby authorized and empowered to execute and deliver the Tax Regulatory Agreement in substantially the form attached hereto, subject to such changes, insertions and omissions and filling of blanks therein as either of such officers may approve, such execution and delivery to be conclusive evidence of such approval.

APPOINTMENT OF ESCROW AGENT AND APPROVAL OF ESCROW DEPOSIT AGREEMENT.

The Bank of New York Mellon Trust Company, N.A. is hereby designated as the Escrow Agent for the current refunding of the Refunded Bonds, the execution and delivery of the Escrow Deposit Agreement is hereby authorized. To provide for the refunding and redemption of the Refunded Bonds the form of the Escrow Deposit Agreement attached hereto as Exhibit “F” is hereby approved, subject to such changes, insertions and omissions and such filling of blanks therein as may be approved by either of the officers of the Issuer executing the same, the execution and delivery thereof to be conclusive evidence of such approval. The Mayor or Mayor Pro Tem of the Issuer and the City Clerk or Assistant City Clerk of the Issuer, or their duly authorized alternate officers are hereby authorized and empowered to execute and deliver the Escrow Deposit Agreement in substantially the form attached hereto, subject to such changes, insertions and omissions and filling of blanks therein authorized hereby.

APPLICATION OF PROCEEDS.

The proceeds from the sale of the 2008A Bonds shall be disposed of in the manner provided in Section 5.01 of the Tenth Supplemental Indenture and as provided by a certificate of the Issuer delivered at or prior to the delivery of the 2008A Bonds.

AUTHORIZATIONS.

The Mayor or the Mayor Pro Tem and the City Clerk or any Assistant City Clerk of the Issuer are hereby authorized and directed to execute the 2008A Bonds as provided herein and in the Indenture, and the Mayor or the Mayor Pro Tem of the Issuer or the City Clerk or any Assistant City Clerk of the Issuer is hereby authorized and directed upon the execution of the 2008A Bonds to deliver such Bonds in the amount authorized to be issued hereunder or such lesser amount as provided in the Purchase Contract, to the Trustee for authentication and delivery to or upon the order of the Original Purchaser pursuant to the Purchase Contract, upon payment of the purchase price therefor and upon compliance by the Original Purchaser with the terms of the Purchase Contract.

The Mayor or the Mayor Pro Tem and the City Clerk or any Assistant City Clerk of the Issuer and the Issuer's Attorney, and such other officers and employees of the Issuer as may be designated by the Mayor or the Mayor Pro Tem, are each designated as agents of the Issuer in connection with the issuance and delivery of the 2008A Bonds, and are authorized and empowered, collectively or individually, to take all action and steps and to execute all instruments, documents and contracts whether or not expressly contemplated hereby, and to execute and do all acts and things required by the provisions of this Resolution and by the provisions of the 2008A Bonds, the Tax Regulatory Agreement, the Escrow Deposit Agreement, the Purchase Contract, the Indenture and the Agreement, as may be necessary for the full, punctual and complete performance of all the terms, covenants, provisions and agreements herein and therein contained, or as otherwise may be necessary or desirable to effectuate the purpose and intent of this Resolution. The Mayor or Mayor Pro Tem and the City Clerk or any Assistant City Clerk of the Issuer are hereby designated as the primary officers of the Issuer charged with the responsibility of issuing the 2008A Bonds.

REPEAL OF INCONSISTENT PROVISIONS.

All resolutions or parts thereof in conflict herewith are to the extent of such conflict superseded and repealed.

INVALIDITY.

In case any one or more of the provisions of this Resolution, the Indenture, the Agreement, the 2008A Bonds, the Tax Regulatory Agreement, the Escrow Deposit Agreement or the Purchase Contract shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provisions of this Resolution, the Indenture, the Agreement, 2008A Bonds, the Tax Regulatory Agreement, the Escrow Deposit Agreement and the Purchase Contract and each such document shall be construed and enforced as if such illegal or invalid provision had not been contained herein or therein. The 2008A Bonds are issued and this Resolution is adopted and the Tax Regulatory Agreement, Purchase Contract, Escrow Deposit Agreement, Indenture and Agreement shall be executed with the intent that the laws of the State of Florida shall govern their construction.

HEADINGS NOT PART OF RESOLUTION.

Any heading preceding the text of the several sections of this Resolution shall be solely for convenience of reference and shall not constitute a part of this Resolution, nor shall such headings affect the meaning, construction or effect of this Resolution.

EFFECTIVE DATE.

This Resolution shall become effective immediately upon its passage.