2016-R-04 MASTER UTILITY SYSTEM REVENUE BOND RESOLUTION
RESOLUTION NO. 2016-R-04
TABLE OF CONTENTS
Page
SECTION 1. AUTHORITY FOR THIS RESOLUTION I
SECTION 2. DEFINITIONS
SECTION 3. FINDINGS I U
SECTION 4. AUTHORIZATION OF PROJECTS 1 I
SECTION 5. RESOLUTION TO CONSTITUTE CONTRACT 12
SECTION 6. AUTHORIZATION OF BONDS AND USE OF PROCEEDS
THEREOF 12
SECTION 7. DESCRIPTION OF BONDS 12
SECTION 8. EXECUTION OF BONDS 13
SECTION 9. NEGOTIABILITY AND REGISTRATION 13
SECTION 10. BONDS MUTILATED,DESTROYED,STOLEN OR LOST 15
SECTION 11. PROVISIONS FOR REDEMPTION 16
SECTION 12. FORM OF BONDS 17
SECTION 13. ESTABLISHMENT OF FUNDS AND ACCOUNTS AND
DISPOSITION OF GROSS REVENUES 32
SECTION 14. DISBURSEMENTS FROM PROJECT FUND 36
SECTION 15. SECURITY FOR BONDS 37
SECTION 16. COVENANTS OF THE ISSUER 38
SECTION 17. FUNDS AND ACCOUNTS 45
SECTION 18. DEFAULT AND REMEDIES 46
SECTION 19. TAX CODE; ERISA 47
SECTION 20. DEFEASANCE 48
SECTION 21. MODIFICATION OR AMENDMENT 48
SECTION 22. SEVERABILITY OF INVALID PROVISIONS 49
SECTION 23. SALE OF BONDS 49
SECTION 24. VALIDATION AUTHORIZED 49
SECTION 25. CAPITAL APPRECIATION BONDS 49
SECTION 26. SUPPLEMENTAL ORDINANCES AND RESOLUTIONS
WITHOUT THE CONSENT OF THE HOLDERS 49
SECTION 27. GOVERNMENTAL REORGANIZATION 49
SECTION 28. ADDITIONAL RIGHTS TO INSURERS 50
SECTION 29. PAYMENTS TO CREDIT FACILITY 50
SECTION 30. SEVERABILITY 50
SECTION 31. SALE OF BONDS 50
SECTION 32. REPEALING CLAUSE 50
SECTION 33. NO THIRD PARTY BENEFICIARIES 50
SECTION 34. NO PERSONAL LIABILITY 51
SECTION 35. EFFECTIVE DATE 5 1
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RESOLUTION NO. 2016-R-04
A MASTER RESOLUTION PROVIDING FOR ISSUANCE
OF UTILITY SYSTEM REVENUE BONDS, NOTES OR
OTHER EVIDENCES OF INDEBTEDNESS
(COLLECTIVELY, "BONDS") OF THE ISSUER FROM
TIME TO TIME IN ONE OR MORE SERIES FOR THE
PURPOSES OF FINANCING AND REFINANCING THE
COSTS OF ACQUIRING, CONSTRUCTING AND
EQUIPPING OF EXTENSIONS AND IMPROVEMENTS TO
THE SYSTEM AND THE PAYMENT OF COSTS OF
ISSUANCE AND OTHER COSTS ASSOCIATED WITH
SUCH BONDS; PROVIDING FOR THE PAYMENT
THEREOF; PROVIDING FOR THE RIGHTS OF THE
HOLDERS OF THE BONDS; MAKING CERTAIN OTHER
COVENANTS AND AGREEMENTS IN CONNECTION
THEREWITH; REPEALING PRIOR AUTHORITY TO
ISSUE BONDS; AND PROVIDING AN EFFECTIVE DATE.
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
EDGEWATER,FLORIDA (the "Issuer"):
SECTION 1. AUTHORITY FOR THIS RESOLUTION. This
resolution is adopted pursuant to the provisions of Chapter 166, Part II, Florida Statutes,
Chapter 180, Florida Statutes, Section 215.431, Florida Statutes, and other applicable
provisions of law(hereinafter collectively referred to as the "Act").
SECTION 2. DEFINITIONS. All terms defined herein shall
have the following meanings unless the text otherwise expressly requires. Words
importing singular number shall include the plural number in each case and vice versa,
and words importing persons shall include firms and corporations:
"Accreted Value" shall mean, as of any date of computation with respect
to any Capital Appreciation Bond, an amount equal to the principal amount of such
Capital Appreciation Bond (the principal amount at its initial offering) plus the interest
accrued on such Capital Appreciation Bond from the date of delivery to the original
purchasers thereof to the Interest Payment Date next preceding the date of computation or
the date of computation if an Interest Payment Date, such interest to accrue at a rate not
exceeding the legal rate, compounded semi-annually, plus, with respect to matters related
to the payment upon redemption or acceleration of the Capital Appreciation Bonds, if
such date of computation shall not be an Interest Payment Date, a portion of the
difference between the Accreted Value as of the immediately preceding Interest Payment
Date and the Accreted Value as of the immediately succeeding Interest Payment Date,
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calculated based on the assumption that Accreted Value accrues during any semi-annual
period in equal daily amounts on the basis of a 360 day year.
"Act" means the laws described in Section 1 hereof.
"Additional Parity Bonds" shall mean any Bonds issued pursuant to and
under the provisions of this Resolution payable from Pledged Revenues on a pari passu
basis with the Bonds originally issued under this Resolution.
"Allowable Impact Fees" shall mean, in any period and for each series of
Bonds, an amount of Impact Fees not in excess of the Impact Fee Percentage times the
aggregate Bond Service Requirements for such series of Bonds, less the amount of
Allowable Impact Fees actually used in all prior periods to pay Bond Service
Requirements on such series of Bonds and actually deposited into the Reserve Account
and previously applied to reduce the Allowable Impact Fees for such series of Bonds;
provided, that the Allowable Impact Fees in any period for each series of Bonds shall not
exceed the Bond Service Requirements for such series maturing or redeemed in such
period.
"Amortization Installment" with respect to any Term Bonds of a series,
shall mean an amount or amounts so designated which is or are established for the Term
Bonds of such series.
"Authorized Investments" shall mean any of the following if and to the
extent the same are at the time legal for investment of municipal funds:
(1) Direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of America.
including obligations issued or held in book entry form on the books of the Department
of the Treasury of the United States;
(2) Bonds, debentures, notes or other evidences of indebtedness
issued, or the principal of and interest on which are unconditionally guaranteed, by any of
the following federal agencies and provided such obligations are backed by the full faith
and credit of the United States of America:
1. U.S. Export-Import Bank: Direct obligations or fully
guaranteed certificates of beneficial ownership
2. Farmers Home Administration (FHA): Certificates of
beneficial ownership
3. Federal Financing Bank: Discount Notes, Notes and
Bonds
4. Federal Housing Administration Debentures (FHA)
5. General Services Administration: Participation
certificates
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6. Government National Mortgage Association
"GNMA"): GNMA - guaranteed mortgage-backed
bonds; GNMA - guaranteed pass-through obligations
7. New Community Debentures: U.S. government
guaranteed debentures
8. U.S. Department of Housing and Urban Development
(HUD): Project Notes and Local Authority Bonds;
9. U.S. Public Housing Notes and Bonds - U.S.
government guaranteed public housing notes and
bonds;
(3) Money market funds registered under the Federal Investment
Company Act of 1940, whose shares are registered under the Federal Securities Act of
1933, and having a rating by S&P of AAAm-G; AAAm; or AAm;
(4) Bank time deposits evidenced by certificates of deposit,
issued by any commercial bank, savings and loan association, or mutual savings bank
insured by the Federal Deposit Insurance Corporation, or the Federal Savings and Loan
Insurance Corporation or fully and continuously secured by obligations described in
paragraphs (1) or (2) of this definition, and provided the collateral is held by a third party
and the Registered Owners of the Bonds have a perfected first security interest in the
collateral;
(5) Commercial paper rated, at the time of purchase, "Prime-1"
by Moody's or "A-1" or better by S&P;
(6) Bonds issued by any state of municipality which are rated by
Moody's or S&P in one of the two highest rating categories assigned by such agencies;
(7) Federal Funds or bankers acceptances with a maximum term
of one year of any bank which has an unsecured and unguaranteed obligation rating of
"Prime-1" or "A3" or better by Moody's and "A-1" or "A" or better by S&P.
(8) Repurchase agreements which provide for the transfer of
securities from a dealer bank or securities firm (seller/borrower) to the Issuer
(buyer/lender), and the transfer of cash from the Issuer to the dealer bank or securities
firm with an agreement that the dealer bank or securities firm will repay the cash plus a
yield to the Issuer in exchange for the securities at a specified date. Repurchase
agreements must satisfy the following criteria or be approved by the Issuer:
(a) The agreement must be between the Issuer and a dealer
bank or securities firm described below:
(i) Primary dealers on the Federal Reserve
Reporting dealer list which are rated A or better by Standard & Poor's Ratings Services
and Moody's Investor Services, or
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(ii) Banks rated "A" or above by Standard & Poor's
Ratings Services and Moody's Investor Services.
(b) The written contract must include the following:
(i) Securities which are acceptance for transfer are:
(1) Direct U.S. governments, or
(2) Federal agencies backed by the full faith
and credit of the U.S. government (and FNMA & FMAC)
(ii) The term of the agreement may be up to 30
(iii) The collateral must be delivered to the Issuer
before or simultaneously with payment (perfection by possession of certificated
securities).
(iv) The securities must be valued weekly,
marketed-to marketed at current market price plus accrued interest. The value of
collateral must be equal to 104% of the amount of cash transferred by the Issuer to the
dealer bank or security film under the agreement plus accrued interest. If the value of
securities held as collateral drops below 104% of the value of the cash transferred by
municipality, then additional cash and/or acceptable securities must be transferred. If,
however, the securities used as collateral are FNMA or FMAC, then the value of the
collateral must equal 105%.
(c) A legal opinion must be delivered to the Issuer to the
effect that the repurchase agreement meets guidelines under state law for legal investment
of public funds.
(9) Investments under the "Investment of Local Government
Surplus Funds Act", being Part IV, Chapter 218, Florida Statutes.
(10) Investments not described above which are permitted under
the Issuer's Investment Policy, dated as of April 7, 2008, as modified, amended and
supplemented from time to time.
"Bond Insurance Policy" shall mean the municipal bond insurance policy
or policies issued by an Insurer guaranteeing the scheduled payment of the principal of
and interest on any series of Bonds (or any portion thereof), when due, as further
provided in the applicable Supplemental Resolution with respect to such series of Bonds.
"Bonds" shall mean bonds, notes, loans or other evidences of indebtedness
issued hereunder by the Issuer in compliance with the terms, conditions and limitations
contained herein which have an equal lien on the Pledged Funds.
"Bond Service Requirement" as of any date of calculation and with
respect to any period, as applied to the Bonds of any series, shall mean the sum of:
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(1) The amount required to pay the interest becoming due on the
Bonds of such series during such period except to the extent that such interest shall have
been provided by payments into the Sinking Fund out of Bond or Note proceeds;
(2) The amount required to pay the principal of Serial Bonds of
such series maturing in such period; and
(3) The Amortization Installment for the Term Bonds of such
series for such period.
In computing the Bond Service Requirement for any period for Bonds of any series, the
Issuer shall assume that a principal amount of Term Bonds and the Accreted Value of the
Capital Appreciation Term Bonds for such period will be retired by purchase or
redemption in such period and that on that stated maturity date, only the remaining
Amortization Installment applicable to Term Bonds and Capital Appreciation Term
Bonds in such year shall be deemed to mature in such year. In computing the Bond
Service Requirement for any period for Variable Rate Bonds of any series, the Issuer
shall assume an interest rate equal to the higher of: (i) the then current rate of interest or
(ii) the average rate of interest over the immediately preceding twelve (12) month period,
if the Variable Rate Bonds have been Outstanding for twelve (12) months or more. In
computing the Bond Service Requirement for any Bonds, 20% or more of the principal
payments of which are due in a single year, which portion of the principal is not required
to be amortized by redemption prior to such date (a "Balloon Payment") the Issuer shall
assume that the Balloon Payment is amortized from the date of the Balloon Payment over
a period of twenty (20) years on a level debt service basis at an interest rate equal to the
most recently published Revenue Bond Index (or a similar index if the Revenue Bond
Index is no longer published) as published by the Bond Buyer. The Bond Service
Requirement for any Bond Year shall be adjusted to reflect any amounts on deposit in the
Sinking Fund in excess of current requirements and available for the payment of the
Bond Service Requirement in such Bond Year. If the Bonds are Option Bonds, the date
or dates of tender shall be disregarded, unless actually tendered and not remarketed, and
the stated maturity dates thereof shall be used for the purposes of this calculation.
"Bond Year" shall mean a period of twelve months determined by the
Issuer with respect to a particular series of Bonds. If not otherwise specified by the
Issuer in a Supplemental Resolution, the Bond Year with respect to a particular Series of
Bonds shall be a twelve month period ending on a principal payment date.
"Capital Appreciation Bonds" shall mean Bonds the interest on which is
payable only at maturity or redemption, as determined by subsequent resolution.
"Capital Appreciation Term Bonds" shall mean Capital Appreciation
Bonds of a series all of which shall be stated to mature on one date, which shall be
subject to retirement by operation of the Bond Amortization Account, and the interest on
which is payable only at maturity or redemption.
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"Consulting Engineers" shall mean the qualified and recognized
consulting engineers retained by the Issuer and having a favorable repute for skill and
experience as consulting engineers with respect to facilities similar to the System, for the
purpose of performing the acts and carry out the duties as herein provided for such
Consulting Engineers. The functions of the Consulting Engineers hereunder may be
divided between or among multiple consulting engineers.
"Controlled Group" means all members of a controlled group of
corporations and all operations, trades or businesses (whether or not incorporated) under
common control which, together with the Issuer, are treated as a single employer under
Section 414 of the Code.
"Cost of Operation and Maintenance" of the System shall mean the
current expenses, paid or accrued, of operation, maintenance and repair of the System,
calculated in accordance with generally accepted accounting principles, but shall not
include any (i) reserves or renewals and replacements, (ii) extraordinary repairs, (iii) any
allowance for depreciation or amortization, (iv) reimbursement to the Issuer's general or
other funds for the cost of services provided for the benefit of the System, (v) interest on
any debt payable from Net Revenues, or (vi) expenses actually funded from sources other
than Gross Revenues.
"Credit Facility" or "Credit Facilities" shall mean individually or
collectively, as appropriate, any bond insurance policy, surety bond, letter of credit, line
of credit, guaranty, or other instrument or instruments that provide credit support or
enhancement for the Bonds.
"Credit Facility Issuer" or "Credit Facility Issuers" means the provider
or providers of the Credit Facility or Credit Facilities.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and all rules and regulations from time to time
promulgated thereunder.
"Federal Securities" shall mean:
(1) U.S. Treasury Certificates, Notes and Bonds (including State
and Local Government Series -- "SLGS").
(2) Direct obligations of the Treasury which have been stripped
by the Treasury itself, CATS, TIGRS and similar securities.
(3) Resolution Funding Corp. (REFCORP: Only the interest
component of REFCORP strips which have been stripped by request to the Federal
Reserve Bank of New York in book entry form are acceptable.
(4) Pre-refunded municipal bonds rated "Aa" by Moody's or
"AA" by S&P. If however, the issue is only rated by S&P (i.e., there is no Moody's
rating), then the pre-refunded bonds must have been pre-refunded with cash, direct U.S.
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or U.S. guaranteed obligations, or AA rated pre-refunded municipals to satisfy this
condition.
(5) Obligations issued by the following agencies which are
backed by the full faith and credit of the U.S.:
A. U.S. Export-Import Bank(Eximbank)
Direct obligations or fully guaranteed certificates of
beneficial ownership
B. Farmers Home Administration(FHA)
Certificates of beneficial ownership
C. Federal Financing Bank
D. Federal Housing Administration Debentures (FHA)
E. General Services Administration
Participation certificates
F. U.S. Maritime Administration
Guaranteed Title XI financing
G. U.S. Department of Housing and Urban Development
(HUD) Project Notes
H. Local Authority Bonds
I. New Communities Debentures - U.S. government
guaranteed debentures U.S. Public Housing Notes and
Bonds - U.S. government guaranteed public housing
notes and bonds
"Gross Revenues" shall mean all income, utility fees, or earnings derived
by the Issuer from the operation of the System or from investment income on the funds
and accounts established under this Resolution (other than the Rebate Fund), all
determined in accordance with generally accepted accounting principles, excluding (i)
Impact Fees, (ii) interest earnings on the Project Fund and the Improvement Fund and
(iii) investment earnings on all funds and accounts established hereunder except the
Project Fund and the Improvement Fund.
"Impact Fee Percentage" shall mean, for each series of Bonds that
percentage obtained by dividing the New User Facilities Portion for such series of Bonds
by the original principal amount of such series of Bonds.
"Impact Fees" shall mean the water and sewer development charges or
stormwater charges, if applicable, levied upon and collected from new users of the
System by the Issuer to the extent that such fees are legally available solely for the
construction and acquisition of New User Facilities or the financing thereof and .
administrative fees.
"Improvement Fund" shall mean the Utility System Capital Improvement
Fund created by the Issuer under this Resolution for deposit of Impact Fees.
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"Insurer" shall mean, with respect to any series of Bonds, such Person as
shall be insuring or guaranteeing the scheduled payment of principal of and interest on
such series of Bonds.
"Interest Payment Date" shall mean the date or dates set forth in a
Supplemental Resolution for the payment of interest on a Series of Bonds.
"Issuer" shall mean the City of Edgewater. Florida.
"Maturity Amount" means the amount payable upon the stated maturity
of a Capital Appreciation Bond equal to the principal amount thereof plus all accrued
interest thereon from the date of issue to the date of maturity.
"Maximum Bond Service Requirement" for all Bonds or any series of
Bonds shall mean, as of any particular date of calculation and with respect to any period,
the Bond Service Requirement as contemplated for the then current or any future period
in which such sum is the greatest.
"Multiemployer Plan" means any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA.
"Net Revenues" of the System shall mean the Gross Revenues after
deduction of the Cost of Operation and Maintenance.
"New User Facilities" shall mean improvements, extensions and additions
to the System, together with all lands or interests therein, including plants, buildings,
machinery', franchises, pipes, mains, fixtures, equipment and all property, real or
personal, tangible or intangible, heretofore or hereafter constructed or acquired in order to
meet the increased demand upon the System, whether actual or anticipated. created by
new users connecting to the System.
"New User Facilities Portion" shall mean, for each series of Bonds, that
portion of such Bonds issued hereunder, the proceeds of which are used to finance or
refinance New User Facilities.
"Option Bonds" shall mean Bonds subject to tender for payment prior to
their maturity at the option of the holder thereof.
"Outstanding" or "outstanding", when referring to Bonds or other
obligations issued hereunder, shall mean such Bonds except (i) those which have been
paid, or for which provision for payment has been made under Section 20, and (ii) those
in exchange for which new Bonds have been issued under Section 9, 10 or 11 hereof.
"Owners" or "Holders" shall mean the holders or registered owners, as
appropriate, of the Bonds, including without limitation, the owners shown on the
registration books of the Registrar.
"Paying Agent" shall mean the Clerk of the Issuer or such other paying
agent as is appointed by the Issuer from time to time to serve as paying agent hereunder.
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"Person" shall mean an individual, a corporation, a partnership, an
association, a joint stock company, a trust, any unincorporated organization or
governmental entity.
"Plan" means, at any time, an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Tax Code and is either (i)maintained by a member of a Controlled
Group for employees of any member of the Controlled Group, or (ii) maintained pursuant
to a collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which a member of the Controlled Group is
then making or accruing an obligation to make contributions or has within the preceding
five plan years made contributions.
"Pledged Funds" shall mean the Net Revenues, the Allowable Impact
Fees, and, until applied as herein provided, the proceeds of the Bonds. The definition of
"Pledged Funds" with respect to a particular series of Bonds shall also include moneys on
deposit in a subaccount of the Reserve Account or the Project Fund for which such
subaccount was established, as may be described in the applicable Supplemental
Resolution for such series of Bonds.
"Project" shall mean the actual, proposed or potential acquisition,
construction, addition, extension, supplement, replacement or improvement of the System
or joint ownership of similar properties or any interest or any right to use the capacity
from any facilities or services thereof, as shall be described in a Supplemental Resolution
for each series of Bonds to be issued under and pursuant to this Resolution, the plans and
specifications for which shall be kept on file with the Issuer, as may be revised or
supplemented from time to time.
"Rate Consultant" shall mean an engineer or other consultant having
recognized expertise in public utility finance, including projections of utility revenues
and development of utility rate studies.
"Rebate Amount" means the excess of the future value, as of a
computation date, of all receipts on nonpurpose investments (as defined in Section 1.148-
1(b) of the Income Tax Regulations) over the future value, as of that date, of all payments
on nonpurpose investments, all as provided by regulations under the Tax Code
implementing Section 148 thereof.
"Rebate Fund" shall mean the City of Edgewater Utility System Revenue
Bonds Rebate Fund established pursuant to Section 19 hereof.
"Rebate Year" shall mean, with respect to a particular series of Bonds
issued hereunder, a one-year period (or shorter period from the date of issue) that ends at
the close of business on the day in the calendar year selected by the Issuer as the last day
of a Rebate Year. The final Rebate Year with respect to a particular Series of Bonds
issued hereunder, however, shall end on the date of final maturity of that Series of Bonds.
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"Registrar" shall mean the Clerk of the Issuer or such other registrar as
shall be appointed from time to time by resolution of the Issuer.
"Reserve Requirement" shall mean the reserve requirement, if any, set
forth in a Supplemental Resolution with respect to a particular series of Bonds.
"Resolution" shall mean this resolution of the Issuer, as hereafter amended
and supplemented from time to time in accordance with the provisions hereof.
"Serial Bonds" shall mean the Bonds of a series which shall be stated to
mature in annual installments.
"Supplemental Resolution" shall mean a Supplemental Resolution of the
Issuer providing for the issuance of a series of Bonds under and pursuant to the terms of
this Resolution.
"System" shall mean the complete water, wastewater and stormwater
utility system now owned, managed and controlled by the Issuer or which is proposed to
be acquired by and operated and maintained by the Issuer and which the Issuer is or shall
be responsible for maintaining, together with any and all acquisitions, additions,
extensions and improvements thereto heretofore or hereafter constructed or acquired,
together with all lands and interests therein and property, real or personal, tangible or
intangible (including any agreements for providing utilities services).
"Tax Code" shall mean Section 103 and Part IV of Subchapter B of
Chapter I of the Internal Revenue Code of 1986, as amended, or any successor law, and
any valid and applicable rules and regulations promulgated thereunder.
"Term Bonds" shall mean the Bonds of a series all of which shall be
stated to mature on one date and which shall be subject to retirement by operation of the
Bond Amortization Account.
"Variable Rate Bonds" shall mean the Bonds of a series that bear interest
at a variable, adjustable, convertible or other similar rate which is not fixed in percentage
for the entire remaining term thereof.
SECTION 3. FINDINGS. It is hereby ascertained, determined
and declared that:
A. The Issuer now owns, operates and maintains the System and
derives Gross Revenues and Impact Fees from fees, rates, rentals and other charges made
and collected for the products, services and facilities of the System.
B. The Issuer has previously undertaken and may from time to
time in the future determine to undertake certain Projects with respect to the System in
order to preserve and protect the public health, safety, and welfare of the inhabitants of
the Issuer.
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t
C. The Net Revenues are currently pledged and encumbered for
the payment of the Issuer's Water and Sewer Revenue Notes, Series 2009 and its Water
and Wastewater System Refunding Revenue Bonds, Series 2012 collectively, the
"Existing Debt").
D. It is necessary and desirable to provide for the establishment
of this Resolution as a Master Resolution for the issuance of Bonds of the Issuer for
various Projects that the Issuer may determine from time to time to finance with the
proceeds of Bonds.
E. The principal of and interest on Bonds issued pursuant to this
Resolution and all required sinking fund, redemption, reserve and other payments shall be
payable solely from the Pledged Funds as provided herein. The Issuer shall never be
required to levy ad valorem taxes on any property therein to pay the principal of and
interest on the Bonds or to make any of the required sinking fund, reserve or other
payments and such Bonds shall not constitute a lien upon any property of, or in, the
Issuer. The Bonds shall not constitute a general indebtedness of the Issuer within the
meaning of any constitutional or statutory provision.
F. In connection with the issuance of Bonds by the Issuer to
finance projects with respect to the System, the Issuer shall adopt one or more
Supplemental Resolutions for the purposes of authorizing the issuance of one or more
i series of such Bonds.
SECTION 4. AUTHORIZATION OF PROJECTS. The
Issuer shall from time to time, adopt a Supplemental Resolution to authorize a Project
pursuant to the report of a Consulting Engineer on file with or to be filed with the Issuer.
The cost of the Project in addition to the items set forth in the plans and specifications,
may include, but need not be limited to, the acquisition of any lands, rights-of-ways or
interest therein or any other properties deemed necessary or convenient therefor;
engineering, legal and financing expenses, expenses for estimates of costs and of
revenues; expenses for plans, specifications and surveys: the fees of fiscal agents,
financial advisors or consultants: operating costs incurred during construction;
administrative expenses relating solely to the construction and acquisition of the Project;
the capitalization of interest on those Bonds attributable to the cost of the Project for a
reasonable period after the issuance of the Bonds; the creation and establishment of
reasonable reserves for debt service; the discount on the sale of the Bonds, if applicable;
repayment of interim advances and indebtedness; premiums for bond insurance or other
credit enhancement fees; and such other costs and expenses as may be necessary or
incidental to the financing herein authorized and the construction and acquisition of the
Project and the placing of same in operation.
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SECTION 5. RESOLUTION TO CONSTITUTE
CONTRACT. In consideration of the acceptance of the Bonds authorized to be issued
hereunder by those who shall own the same from time to time, this Resolution shall be
deemed to be and shall constitute a contract between the Issuer and such Owners. The
covenants and agreements herein and therein set forth to be performed by the Issuer shall
be for the equal benefit, protection and security of the Owners of any and all of the Bonds
all of which shall be of equal rank and without preference, priority or distinction of any
of the Bonds over any other thereof, except as expressly provided therein and herein.
SECTION 6. AUTHORIZATION OF BONDS AND USE OF
PROCEEDS THEREOF. The Issuer may, from time to time, authorize by
Supplemental Resolution the issuance of one or more series of Bonds of the Issuer to be
known as "Utility System Revenue Bonds" to finance all or a portion of the costs of
Projects. In addition, the Issuer may also authorize by Supplemental Resolution the
refinancing of Projects through the issuance of one or more series of refunding Bonds.
The Issuer may issue Bonds which may be secured by a Credit Facility or by a Bond
Insurance Policy all as shall be determined by Supplemental Resolution of the Issuer. All
moneys received from the sale of the Bonds shall be applied by the Issuer as set forth in
the Supplemental Resolution with respect to such series of Bonds
SECTION 7. DESCRIPTION OF BONDS. The Bonds of a
series shall be in such denominations, and shall be dated, shall bear interest, payable on
such dates, at such rate or rates not exceeding the maximum rate fixed by the Act or other
applicable law, and shall mature on such date and in such years and amounts all as shall
be determined by Supplemental Resolution of the Issuer adopted prior to the delivery
thereof.
The Bonds of a series shall be issued in fully registered form, without
coupons; shall be payable with respect to both principal and interest upon presentation
and surrender thereof on the date fixed for maturity or redemption thereof at the office of
the Bond Registrar in lawful money of the United States of America; and shall bear
interest from such date, but not earlier than the date of the Bonds, payable at such times,
all as is fixed by Supplemental Resolution of the Issuer.
Unless otherwise provided by Supplemental Resolution with respect to a
series of Bonds, interest on the Bonds which is payable prior to maturity or redemption
shall be paid by check or draft mailed to the Owners, at their addresses as they appear on
the Bond Register, at the close of business on the 15th day of the month (whether or not a
business day) next preceding the Interest Payment Date for the Bonds (the "Record
Date"), irrespective of any transfer of the Bonds subsequent to such Record Date and
prior to such Interest Payment Date, unless the Issuer shall be in default in the payment of
interest due on such Interest Payment Date. In the event of any such default, such
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defaulted interest shall be payable to the Owners at the close of business on a special
record date for the payment of defaulted interest as established by notice mailed to the
Owners in whose names such Bonds are registered at the close of business on the fifth
(5th)day preceding the date of mailing.
If the date for payment of the principal of, premium, if any, or interest on
the Bonds shall be a Saturday, Sunday, legal holiday or a day on which the banking
institutions in the city where the principal office of the Paying Agent is located are
authorized by law or executive order to close, then the date for such payment shall be the
next succeeding day which is not a Saturday, Sunday or legal holiday or a day on which
such banking institutions are authorized to close, and payment on such date shall have the
same force and effect as if made on the nominal date of payment.
SECTION 8. EXECUTION OF BONDS. The Bonds shall be
executed in the name of the Issuer by the Mayor and attested and countersigned by the City
Clerk of the Issuer, and the corporate seal of the Issuer or a facsimile thereof shall be affixed
thereto or reproduced thereon. The facsimile signatures of such officers shall be imprinted or
reproduced on the Bonds. The Certificate of Authentication of the Bond Registrar, hereinafter
described, shall appear on the Bonds, and no Bonds shall be valid or obligatory for any purpose
or be entitled to any security or benefit under this Resolution unless such certificate shall have
been duly executed on such Bond. The authorized signature for the Bond Registrar shall at all
times be a manual signature. In case any officer whose signature shall appear on any Bonds shall
cease to be such officer before the delivery of such Bonds, such signature or facsimile shall
nevertheless be valid and sufficient for all purposes the same as if he had remained in office until
such delivery. Any Bond may be signed and sealed on behalf of the Issuer by such person who
at the actual time of the execution of such Bonds shall hold the proper office with the Issuer,
although at the date of delivery of such Bonds such person may not have held such office or may
not have been so authorized.
If any series of the Bonds are validated, the validation certificate on Bonds
shall be executed with the manual or facsimile signature of the Mayor. The Issuer may
adopt and use for such purposes the facsimile signature of any person who shall have
held such office at any time on or after the date of adoption of this Resolution,
notwithstanding that he may have ceased to be such officer at the time the Bonds are
actually delivered.
SECTION 9. NEGOTIABILITY AND REGISTRATION.
A. NEGOTIABILITY. The Bonds shall be and shall have all of
the qualities and incidents of negotiable instruments under the Uniform Commercial
Code-Investment Securities of the State of Florida, and each successive Owner, in
accepting any of the Bonds shall be conclusively deemed to have agreed that such Bonds
shall be and have all of the qualities and incidents of negotiable instruments under the
Uniform Commercial Code-Investment Securities of the State of Florida.
13
B. REGISTRATION AND TRANSFER. There shall be a
Registrar for the Bonds which shall be the City Clerk or a bank or trust company located
within or without the State of Florida. The Registrar shall maintain the registration books
of the Issuer (the "Bond Register") and be responsible for the transfer and exchange of
the Bonds. The Issuer shall, prior to the proposed date of delivery of any Bonds, by
resolution designate the Registrar and Paying Agent. The Registrar shall maintain the
Bond Register for the registration of the transfer and exchange of the Bonds in
compliance with an agreement to be executed between the Issuer and such Registrar.
The Bonds may be transferred upon the Bond Register, upon delivery to the
Registrar, accompanied by a written instrument or instruments of transfer or authorization
for exchange, in form and with guaranty of signature satisfactory to the Issuer and the
Registrar duly executed by the Owner or by his duly authorized attorney, together with
written instructions as to the details for the transfer of such Bonds, along with the social
security or federal employer identification number of such transferee and, if such
transferee is a trust, the name and social security or federal employer identification
numbers of the settlor and beneficiaries of the trust, the date of the trust and the name of
the trustee. No transfer of any Bond shall be effective against the Issuer, Registrar or
Paying Agent until entered on the Bond Register maintained by the Registrar.
In all cases of the transfer of the Bonds, the Registrar shall enter the transfer
of ownership on the Bond Register and shall authenticate and deliver in the name of the
transferee or transferees a new fully registered Bond or Bonds of authorized
denominations of the same maturity and interest rate for the aggregate principal amount
which the Owner is entitled to receive at the earliest practicable time in accordance with
the provisions of this Resolution. Any Bond or Bonds shall be exchangeable for a Bond
or Bonds of the same maturity and interest rate, in any authorized denomination, but in a
principal amount equal to the unpaid principal amount of the Bond or Bonds presented
for exchange. Bonds to be exchanged shall be surrendered at the principal office of the
Registrar, and the Registrar shall deliver in exchange therefor the Bond or Bonds which
the Owner making the exchange shall be entitled to receive. The Issuer or the Registrar
may charge the Owner of such Bond for every such transfer or exchange, an amount
sufficient to reimburse them for any tax, fee, or other governmental charge required to be
paid with respect to such transfer or exchange, and may require that such charge be paid
before any such new Bond shall be delivered.
If the Issuer at any time or from time to time determines that a Book Entry
Registration System shall be used for any series of Bonds, the Issuer is authorized to
enter into an agreement with the Registrar and Paying Agent and with the Depository
Trust Company ("DTC"), or any successor thereto, or other securities depository, and
make such other provisions and perform such further acts as are necessary or appropriate
to provide for the distribution of such series of Bonds in book-entry form.
The Issuer shall issue such series of Bonds directly to beneficial Owners of
such series of Bonds other than DTC, or its nominee, in the event that:
14
(a) DTC determines not to continue to act as securities depository for
such series of Bonds: or
(b) The Issuer has advised DTC of its determination that DTC is
incapable of discharging its duties: or
(c) The Issuer determines that it is in the best interest of the Issuer not to
continue the book-entry system or that the interests of the beneficial Owners of such
series of Bonds might be adversely affected if the book-entry system is continued.
Upon occurrence of the events described in (a) or (b) above the Issuer shall
attempt to locate another qualified securities depository.
In the event the Issuer make the determination noted in (b) or(c) above (the
Issuer undertakes no obligation to make any investigation to determine the occurrence of
any events that would permit the Issuer to make any such determination) or if the Issuer
fails to locate another qualified securities depository to replace DTC upon occurrence of
the events described in (a) or (b) above, the Issuer shall mail a notice to DTC for
distribution to the beneficial Owners of such series of Bonds stating that DTC will no
longer serve as securities depository, whether a new securities depository will or can be
appointed, the procedures for obtaining the Bonds of such series and the provisions of the
Resolution which govern such series of Bonds including, but not limited to, provisions
regarding authorized denominations, transfer and exchange, principal and interest
payment and other related matters.
SECTION 10. BONDS MUTILATED, DESTROYED,
STOLEN OR LOST. In case any Bond shall become mutilated, or be destroyed,
stolen or lost, the Issuer shall issue and deliver a new Bond of like tenor as the Bond so
mutilated, destroyed. stolen or lost, in exchange and substitution for such mutilated Bond,
upon surrender and cancellation of such mutilated Bond or in lieu of and substitution for
the Bond destroyed, stolen or lost, and upon the Owner furnishing the Issuer proof of his
ownership thereof and satisfactory indemnity and complying with such other reasonable
regulations and conditions as the Issuer may prescribe and paying such expenses as the
Issuer may incur. All Bonds so surrendered shall be cancelled by the Registrar. If any
such Bonds shall have matured or be about to mature, instead of issuing a substitute
Bond, the Issuer may pay the same, upon being indemnified as aforesaid, and if such
Bond be lost, stolen or destroyed, without surrender thereof
Any such duplicate Bonds issued pursuant to this section shall constitute
original, additional contractual obligations whether or not the lost, stolen or destroyed
Bonds be at any time found by anyone, and such duplicate Bonds shall be entitled to
equal and proportionate benefits and rights as to lien on and source and security for
payment from the funds, as hereinafter pledged, to the extent as all other Bonds issued
hereunder.
15
SECTION 11. PROVISIONS FOR REDEMPTION.
A. The Bonds of each series shall be subject to mandatory
redemption by operation of the Bond Amortization Account, or at the option of the
Issuer, or upon such other terms, as provided by Supplemental Resolution of the Issuer
adopted at or prior to the sale of such series of Bonds.
B. Bonds in denominations greater than a minimum authorized
denomination (or a minimum authorized Maturity Amount in the case of Capital
Appreciation Bonds) shall be deemed to be an equivalent number of Bonds in the
denomination of a minimum authorized denomination or Maturity Amount. If a Bond is
of a denomination or Maturity Amount larger than a minimum authorized denomination
or Maturity Amount, a portion of such Bond may be redeemed, in the amount of such
minimum authorized denomination or Maturity Amount or integral multiples thereof.
C. Notice of such redemption, identifying the Bonds or portions
thereof called for redemption (i) shall be filed with the Paying Agent and Registrar: and
(ii) shall be mailed by the Paying Agent, first-class mail, postage prepaid, to all Owners
of the Bonds to be redeemed not more than forty-five (45) days and not less than thirty
(30) days prior to the date fixed for redemption at their addresses as they appear on the
Bond Register and, if any Bonds are not fully registered, by publication at least once not
more than forty-five (45) days nor less than thirty (30) days prior to the redemption date
in a financial newspaper or journal of general circulation in the City of New York, New
York. Failure to give such notice by mailing to any Owner of Bonds, or any defect
therein, shall not affect the validity of any proceeding for the redemption of other Bonds.
D. Notice having been mailed and filed in the manner and under
the conditions hereinabove provided, the Bonds or portions of Bonds so called for
redemption shall, on the redemption date designated in such notice, become and be due
and payable at the redemption price provided for redemption of such Bonds or portions of
Bonds on such date. On the date so designated for redemption, notice having been mailed
and filed and moneys for payment of the redemption price being held in separate
accounts in trust for the Owners of the Bonds or portions thereof to be redeemed, all as
provided in this Resolution, interest on the Bonds or portions of Bonds so called for
redemption shall cease to accrue, such Bonds and portions of Bonds shall cease to be
entitled to any lien, benefit or security under this Resolution, and the Owners of such
Bonds or portions of Bonds, shall have no rights in respect thereof, except the right to
receive payment of the redemption price thereof.
E. Upon surrender of any Bond for redemption in part only, the
Issuer shall issue and deliver to the Owner thereof a new Bond or Bonds of authorized
denominations or Maturity Amounts in aggregate principal amount equal to the
unredeemed portion surrendered.
16
F. In addition to the foregoing notice requirements. the Issuer
shall give notice and make redemptions in accordance with Securities and Exchange
Commission Release No. 34-3856, if then in effect, or any other release, regulation,
procedure, ruling, decision or statute modifying or superseding that release then in effect:
provided that if notice complying with Subsections C of this Section is given, neither the
failure to comply with this Subsection F nor any defect in the giving of any notice
pursuant to this Subsection F shall affect or invalidate the proceedings for such
redemption.
SECTION 12. FORM OF BONDS. The Bonds, the Capital
Appreciation Bonds, the Certificate of Authentication, and the Assignment shall be in
substantially the following form, with such omissions, insertions and variations as may be
necessary and desirable and which are herein authorized or permitted or which are
subsequently authorized or permitted by a Supplemental Resolution adopted by the Issuer
prior to the issuance of a series of Bonds.
17
(FORM OF BOND
OTHER THAN CAPITAL APPRECIATION BOND)
No. 2016-R-04 S
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF EDGEWATER
UTILITY SYSTEM REVENUE BOND, SERIES
Rate of
Interest Maturity Date Date of Issue CUSIP
Registered Owner:
Principal Amount:
KNOW ALL MEN BY THESE PRESENTS, that the City of Edgewater,
Florida (hereinafter called "Issuer"), for value received, hereby promises to pay, solely
from the Pledged Funds hereinafter mentioned, to the Registered Owner identified above,
or registered assigns, on the Maturity Date specified above, the Principal Amount shown
above, and to pay interest on said sum from the Date of Issue of this Bond or from the
most recent interest payment date to which interest has been paid, at the Rate of Interest
per annum set forth above until payment of such Principal Amount, such interest being
payable 1, and semiannually thereafter on
1 and 1, of each year. The principal of and premium, if
any, and interest payable on this Bond at maturity or redemption are payable upon
presentation and surrender hereof on the date fixed for maturity or Redemption at the
principal corporate trust office of (the "Paying Agent" and
"Registrar") in , Florida, or at the office designated for such payment of
any successor thereof The interest on this Bond, when due and payable, other than at
maturity or redemption, shall be paid by check or draft mailed to the person in whose
name this Bond is registered, at his address as it appears on the Bond Register, at the
close of business on the fifteenth day of the month (whether or not a business day) next
preceding the interest payment date (the "Record Date") or, in the case of payment after
default, a special record date, as provided in the Resolution hereinafter mentioned. All
amounts due hereunder shall be payable in any coin or currency of the United States
which is at the time of payment legal tender for the payment of public or private debts.
This Bond is one of an authorized issue of Bonds in the aggregate principal
amount of$ , of like tenor and effect, except as to [insert as appropriate]
(date, number, series, interest rate, redemption provisions, and Maturity Date), issued to
[refund (describe Bonds refunded] [finance part of the cost of the acquisition and
18
construction of extensions and improvements to the utility system (the "System") of the
Issuer (the "Project")], pursuant to the authority of and in full compliance with the
Constitution and laws of the State of Florida, including particularly Chapter 166, Part II,
and Chapter 180, Florida Statutes, and other applicable provisions of law, and a
resolution duly adopted by the Issuer on , 2016, as [amended and]
supplemented (hereinafter collectively called the "Resolution"), and is subject to all the
terms and conditions of such Resolution, the provisions of which are incorporated herein
by reference.
This Bond and the issue of Bonds of which it is a part are special
obligations of the Issuer payable solely from and secured by (1) the net revenues derived
from the operation of the System (the "Net Revenues"), (2) certain allowable impact fees
related to the System ("Allowable Impact Fees"), (3) the income on investment of funds
held in the Project Fund under the Resolution, and (4) until applied as provided in the
Resolution, the proceeds of the Bonds, all in the manner provided in the Resolution (such
sources hereinafter collectively called the "Pledged Funds").
The Bonds shall not constitute a general indebtedness or a pledge of the
faith or credit of the Issuer within the meaning of any constitutional or statutory
provision, and the Issuer shall never be required to levy ad valorem taxes on any property
to pay the principal of or interest on the Bonds or to make any of the required payments
under the Resolution, or be required or compelled to pay the same from any funds of the
Issuer except the Pledged Funds, in the manner provided in the Resolution. The
acceptance of the Bonds by the Registered Owners from time to time thereof shall be
deemed an agreement between the Issuer and each of such Registered Owners that the
Bonds and the obligations evidenced thereby shall not constitute a lien upon any property
of or in the Issuer, but shall constitute a lien only upon the Pledged Funds in the manner
provided in the Resolution.
It is hereby certified and recited that all acts, conditions and things required
to happen, exist and be performed, precedent to and in the issuance of this Bond, have
happened, exist, and have been performed in due time, form and manner as required by
the Constitution and laws of the State of Florida applicable thereto, and that the issuance
of the Bonds of this issue does not violate any constitutional or statutory limitations or
provisions.
[INSERT REDEMPTION PROVISIONS]
Bonds in denominations greater than S5,000 Principal Amount shall be
deemed to be an equivalent number of Bonds of the denomination of S5,000 Principal
Amount. In the event a Bond is of a Principal Amount larger than $5,000, a portion of
such Bond may be redeemed, but Bonds shall be redeemed only in the Principal Amount
of$5,000 or any integral multiple thereof. Notice of redemption identifying the Bonds or
portions thereof to be redeemed will be given by the Registrar by mailing a copy of the
redemption notice by first-class mail (postage prepaid) not more than forty-five (45) days
and not less then thirty (30) days prior to the date fixed for redemption to the Registered
19
Owner of each Bond to be redeemed in whole or in part at the address shown on the Bond
Register, and otherwise as provided in the Resolution. Failure to give such notice by
mailing to any Registered Owner of Bonds, or any defect therein, shall not affect the
validity of any proceeding for the redemption of other Bonds. All Bonds so called for
redemption will cease to bear interest after the specified redemption date provided funds
for their redemption are on deposit at the place of payment at that time. Upon surrender
of any Bond for redemption in part only, the Issuer shall issue and deliver to the
Registered Owner thereof, the costs of which shall be paid by the Registered Owner, a
new Bond or Bonds of authorized denominations in aggregate principal amount equal to
the unredeemed portion surrendered.
If the date for payment of the principal of, premium, if any, or interest on
this bond shall be a Saturday, Sunday. legal holiday or a day on which banking
institutions in the city where the principal corporate trust office of the Paying Agent is
located are authorized by law or executive order to close, then the date for such payment
shall be the next succeeding day which is not a Saturday, Sunday. legal holiday or a day
on which such banking institutions are authorized to close, and payment on such date
shall have the same force and effect as if made on the nominal date of payment.
[TO BE INSERTED WHERE APPROPRIATE ON FACE OF BOND:
"Reference is hereby made to the further provisions of this Bond set forth on the
reverse side hereof, and such further provisions shall for all purposes have the same
effect as if set forth on this side."]
Subject to the provisions of the Resolution regarding registration, this Bond
is and has all the qualities and incidents of a negotiable instrument under the Uniform
Commercial Code-Investment Securities of the State of Florida.
Subject to the limitations and upon payment of the charges provided in the
Resolution, Bonds may be exchanged for a like aggregate Principal Amount (Maturity
Amount of Capital Appreciation Bonds) of Bonds of the same maturity in other
authorized denominations and are transferable by the Registered Owner in person or by
his attorney duly authorized in writing at the above-mentioned office of the Registrar.
The Issuer shall deem and treat the Registered Owner hereof as the absolute
owner hereof (whether or not this Bond shall be overdue) for the purpose of receiving
payment of or on account of principal hereof and interest due hereon and for all other
purposes, and the Issuer shall not be affected by any notice to the contrary.
In and by the Resolution, the Issuer has covenanted and agreed with the
Registered Owners of the Bonds that it will fix, establish and maintain such rates and
collect such fees, rentals and other charges for the services and facilities of the System
and revise the same from time to time whenever necessary, as will always provide Gross
Revenues in each Fiscal Year sufficient to pay (1) 100% of all Costs of Operation and
Maintenance of the System in such year and 100% of the payments required to be made
into the Reserve Account and Renewal and Replacement Fund in such year, plus (2)
20
together with all other funds pledged to secure junior lien debt, 100% of all Bond Service
Requirements becoming due in such year on all outstanding obligations payable from the
Net Revenues of the System which are junior and subordinate as to lien and pledge of
such Net Revenues to the Bonds, plus (3) 115% of the Bond Service Requirement
becoming due in such year on the Bonds, plus (4) together with the Allowable Impact
Fees, 115% of the Bond Service Requirement becoming due in such year on the Bonds.
The Issuer has entered into certain other covenants and agreements respecting the Bonds,
as to which reference is made to the Resolution.
This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Resolution until the certificate of
authentication hereon shall have been executed by the Registrar.
IN WITNESS WHEREOF, the City of Edgewater, Florida, has issued this Bond
and has caused the same to be executed by the manual or facsimile signature of its Mayor and
attested and countersigned by the manual or facsimile signature of its City Clerk, and its official
seal or a facsimile thereof to be affixed, impressed, imprinted, lithographed or reproduced
hereon, all as of
CITY OF EDGEWATER, FLORIDA
Mike Ignasiak
Mayor
(SEAL)
Attested and Countersigned:
Robin L. Matusick
Interim City Clerk/Paralegal
[IF VALIDATED,FORM OF VALIDATION STATEMENT]
[VALIDATION STATEMENT
This Bond is one of an issue of Bonds which were validated by judgment of the
Circuit Court for Volusia County, Florida, rendered on .
Mike Ignasiak
Mayor
City of Edgewater, Florida
21
CERTIFICATE OF AUTHENTICATION OF REGISTRAR
This Bond is one of the Issue of the within described Bonds. The Rate of Interest,
Maturity Date, Registered Owner and Principal Amount shown above are correct in all respects
and have been recorded, along with the applicable federal taxpayer identification number and the
address of the Registered Owner, in the Bond Register maintained at the principal offices of the
undersigned.
Registrar
Authorized Signature
Date of Authentication
22
ASSIGNMENT
ASSIGNMENT FOR VALUE RECEIVED, the
undersigned
(the `Transferor"), hereby sells, assigns, and transfers unto
(Please insert name and Social Security or Federal Employer Identification number of assignee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
(the `Transferee")
as attorney to register the transfer of the within Bond on the books kept for registration thereof,
with full power of substitution in the premises.
Date:
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed
by a member firm of the New York Stock
Exchange or a commercial bank or a trust
company.
NOTICE: No transfer will be registered and
no new Bond will be issued in the name of
the Transferee, unless the signature(s) to this
assignment corresponds with the name as it
appears upon the face of the within Bond in
every particular, without alteration or
enlargement or any change whatever and the
Social Security or Federal Employer
Identification Number of the Transferee is
supplied.
23
The following abbreviations, when used in the inscription on the face of the
within Bond, shall be construed as though they were written out in full according to applicable
laws or regulations:
TEN COM as tenants in UNIF GIF MIN ACT-
common (Cust.)
TEN ENT as tenants by the Custodian for
(Minor)
JT TEN as joint tenants with under Uniform Gifts to Minors Act
right of survivor- of
ship and not as (State)
tenants in common
Additional abbreviations may also be used though not in list above.
24
(FORM OF CAPITAL APPRECIATION BONDS)
No. CA $
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF EDGEWATER
UTILITY SYSTEM REVENUE BOND, SERIES
Original
Annual Yield Principal Maturity Date of
(Approximate) Amount Date Issue Cusip
Registered Owner:
Maturity Amount:
KNOW ALL MEN BY THESE PRESENTS, that the City of Edgewater,
Florida (hereinafter called "Issuer"), for value received, hereby promises to pay, solely
from the Pledged Funds hereinafter mentioned, to the Registered Owner identified above,
or registered assigns, on the Maturity Date specified above, the Maturity Amount shown
above. The Original Principal Amount identified above will accrete from the Date of
Issue at the approximate Annual Yield identified above (subject to the rounding of the
Accreted Values), compounded on 1, and
semiannually thereafter on 1 and 1 of each
year. The Accreted Value will be paid on the Maturity Date (or upon earlier redemption)
but only upon presentation and surrender of this Bond, provided that on the Maturity
Date or upon earlier redemption hereof, the Accreted Values (per $5,000 Maturity
Amount) as set forth in the Table of Accreted Values shall determine the total amount
due (per $5,000 Maturity Amount) to the Maturity Date or date of redemption. Accreted
Value for any date not set forth in the Table of Accreted Values shall be accrued from the
immediately preceding Accreted Value in the Table in equal daily amounts on the basis
of a 360 day year. Both principal of, premium, if any, and interest on this Bond are
payable in any coin or currency of the United States which at the time of payment is legal
tender for the payment of public or private debts. The Accreted Value of this Bond shall
be payable upon presentation and surrender hereof on the Maturity Date or the date fixed
for redemption at the principal corporate trust office of (the
"Paying Agent" and "Registrar") in , Florida, or at the office designated
for such payment of any successor thereof
25
This Bond is one of a duly authorized issue in the aggregate principal
amount of $ , of like tenor and effect, except as to [insert as
appropriate] (number, date, series, redemption provisions, interest rate, and Maturity
Date), issued to [refund (describe Bonds refunded] [finance part of the cost of the
acquisition, construction, extensions and improvements to the utility system (the
"System") of the Issuer (the "Project")], pursuant to the authority of and in full
compliance with the Constitution and laws of the State of Florida, including particularly
Chapter 166, Part H, and Chapter 180, Florida Statutes, and other applicable provisions of
law, and a resolution duly adopted by the Issuer on , 2016, as [amended
and] supplemented (hereinafter collectively called the "Resolution"), and is subject to all
the terms and conditions of such Resolution, the provisions of which are incorporated
herein by reference.
This Bond and the issue of Bonds of which it is a part are special
obligations of the Issuer payable solely from and secured by (1) the net revenues derived
from the operation of the System (the "Net Revenues"), (2) certain allowable impact fees
related to the System ("Allowable Impact Fees"), (3) the income on investment of funds
held in the Project Fund under the Resolution, and (4) until applied as provided in the
Resolution, the proceeds of the Bonds, all in the manner provided in the Resolution (such
sources hereinafter collectively called the "Pledged Funds").
The Bonds shall not constitute a general indebtedness or a pledge of the
faith or credit of the Issuer within the meaning of any constitutional or statutory
provision, and the Issuer shall never be required to levy ad valorem taxes on any property
to pay the principal of or interest on the Bonds or to make any of the required payments
under the Resolution, or be required or compelled to pay the same from any funds of the
Issuer except the Pledged Funds, in the manner provided in the Resolution. The
acceptance of the Bonds by the Registered Owners from time to time thereof shall be
deemed an agreement between the Issuer and each of such Registered Owners that the
Bonds and the obligations evidenced thereby shall not constitute a lien upon any property
of or in the Issuer, but shall constitute a lien only upon the Pledged Funds in the manner
provided in the Resolution.
It is hereby certified and recited that all acts, conditions and things required
to exist, to happen and to be performed precedent to and in the issuance of this Bond
exist, have happened and have been performed in regular and due form and time as
required by the laws and Constitution of the State of Florida applicable thereto, and that
the issuance of the Bonds of this issue does not violate any constitutional or statutory
limitations or provisions.
(INSERT REDEMPTION PROVISIONS)
Bonds in Maturity Amounts greater than $5,000 shall be deemed to be an
equivalent number of Bonds of the Maturity Amount of$5,000. In the event a Bond is of
a Maturity Amount larger than $5,000, a portion of such Bond may be redeemed, but
Bonds shall be redeemed only in the Maturity Amount of$5,000 or any integral multiple
26
thereof. Notice of redemption identifying the Bonds or portions thereof to be redeemed
will be given by the Registrar by mailing a copy of the redemption notice by first-class
mail (postage prepaid) not more than forty-five (45) days and not less then thirty (30)
days prior to the date fixed for redemption to the Registered Owner of each Bond to be
redeemed in whole or in part at the address shown on the Bond Register, and otherwise as
provided in the Resolution. Failure to give such notice by mailing to any Registered
Owner of Bonds, or any defect therein, shall not affect the validity of any proceeding for
the redemption of other Bonds. All Bonds so called for redemption will cease to bear
interest after the specified redemption date provided funds for their redemption are on
deposit at the place of payment at that time. Upon surrender of any Bond for redemption
in part only, the Issuer shall issue and deliver to the Registered Owner thereof, the costs
of which shall be paid by the Registered Owner, a new Bond or Bonds of authorized
denominations in aggregate principal amount equal to the unredeemed portion
surrendered.
If the date for payment of the principal of, premium, if any, or interest on
this bond shall be a Saturday, Sunday, legal holiday or a day on which banking
institutions in the city where the principal corporate trust office of the Paying Agent is
located are authorized by law or executive order to close, then the date for such payment
shall be the next succeeding day which is not a Saturday, Sunday, legal holiday or a day
on which such banking institutions are authorized to close, and payment on such date
shall have the same force and effect as if made on the nominal date of payment.
[TO BE INSERTED WHERE APPROPRIATE ON FACE OF BOND:
"Reference is hereby made to the further provisions of this Bond set forth on the
reverse side hereof, and such further provisions shall for all purposes have the same
effect as if set forth on this side."]
Subject to the provisions of the Resolution regarding registration, this Bond
is and has all the qualities and incidents of a negotiable instrument under the Uniform
Commercial Code - Investment Securities of the State of Florida.
In and by the Resolution, the Issuer has covenanted and agreed with the
Registered Owners of the Bonds that it will fix, establish and maintain such rates and
collect such fees, rentals and other charges for the services and facilities of the System
and revise the same from time to time whenever necessary, as will always provide Gross
Revenues in each Fiscal Year sufficient to pay (1) 100% of all Costs of Operation and
Maintenance of the System in such year and 100% of the payments required to be made
into the Reserve Account and Renewal and Replacement Fund in such year, plus (2)
together with all other funds pledged to secure junior lien debt, 100% of all Bond Service
Requirements becoming due in such year on all outstanding obligations payable from the
Net Revenues of the System which are junior and subordinate as to lien and pledge of
such Net Revenues to the Bonds, plus (3) 115% of the Bond Service Requirement
becoming due in such year on the Bonds, plus (4) together with the Allowable Impact
Fees, 115% of the Bond Service Requirement becoming due in such year on the Bonds.
27
The Issuer has entered into certain other covenants and agreements respecting the Bonds,
as to which reference is made to the Resolution.
Subject to the limitations and upon payment of the charges provided in the
Resolution, Bonds may be exchanged for a like aggregate Principal Amount (Maturity
Amount for Capital Appreciation Bonds) of Bonds of the same maturity in other
authorized denominations and are transferable by the Registered Owner in person or by
his attorney duly authorized in writing, at the above-mentioned office of the Registrar.
The Issuer shall deem and treat the Registered Owner hereof as the absolute
owner hereof (whether or not this Bond shall be overdue) for the purpose of receiving
payment of or on account of principal hereof and interest due hereon and for all other
purposes, and the Issuer shall not be affected by any notice to the contrary.
This Bond shall not be valid or become obligatory for any purposes or be
entitled to any security or benefit under the Resolution until the certificate of
authentication hereon shall have been duly executed by the Registrar.
IN WITNESS WHEREOF, the City of Edgewater, Florida, has issued this Bond
and has caused the same to be executed by the manual or facsimile signature of its Mayor and
attested and countersigned by the manual or facsimile signature of its City Clerk, and its official
seal or a facsimile thereof to be affixed, impressed, imprinted, lithographed or reproduced
hereon, as all of
CITY OF EDGEWATER,FLORIDA
Mike Ignasiak
Mayor
(SEAL)
Attested and Countersigned:
Robin L.Matusick
Interim City Clerk/Paralegal
]IF VALIDATED, FORM OF VALIDATION STATEMENT]
VALIDATION STATEMENT
This Bond is one of an issue of Bonds which were validated by judgment of the
Circuit Court for Volusia County, Florida, rendered on
Mike Ignasiak, Mayor
City of Edgewater, Florida
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CERTIFICATE OF AUTHENTICATION OF REGISTRAR
This Bond is one of the Issue of the within described Bonds. The Rate of Interest,
Maturity Date, Registered Owner and Principal Amount shown above are correct in all respects
and have been recorded, along with the applicable federal taxpayer identification number and the
address of the Registered Owner, in the Bond Register maintained at the principal offices of the
undersigned.
Registrar
Authorized Signature
Date of Authentication
29
ASSIGNMENT
ASSIGNMENT FOR VALUE RECEIVED, the
undersigned
(the `Transferor"), hereby sells, assigns, and transfers unto
(Please insert name and Social Security or Federal Employer Identification number of assignee)
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
(the `Transferee")
as attorney to register the transfer of the within Bond on the books kept for registration thereof,
with full power of substitution in the premises.
Date:
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed
by a member firm of the New York Stock
Exchange or a commercial bank or a trust
company.
NOTICE: No transfer will be registered and
no new Bond will be issued in the name of
the Transferee, unless the signature(s)to this
assignment corresponds with the name as it
appears upon the face of the within Bond in
every particular, without alteration or
enlargement or any change whatever and the
Social Security or Federal Employer
Identification Number of the Transferee is
supplied.
30
The following abbreviations, when used in the inscription on the face of the
within Bond, shall be construed as though they were written out in full according to applicable
laws or regulations:
TEN COM as tenants in UNIF GIF MIN ACT-
common (Cust.)
TEN ENT as tenants by the Custodian for
(Minor)
JT TEN as joint tenants with under Uniform Gifts to Minors Act
right of survivor- of
ship and not as (State)
tenants in common
Additional abbreviations may also be used though not in list above.
31
SECTION 13. ESTABLISHMENT OF FUNDS AND
ACCOUNTS AND DISPOSITION OF GROSS REVENUES.
A. Revenue Fund. The entire Gross Revenues derived from the
operation of the System shall upon receipt thereof be deposited in the "City of Edgewater
Utility System Revenue Fund" (hereinafter called the "Revenue Fund"), hereby created
and established. The Revenue Fund shall constitute a trust fund for the purposes herein
provided, and shall be kept separate and distinct from all other funds of the Issuer and
used only for the purposes and in the manner herein provided.
B. Sinking Fund and Rate Stabilization Fund. There are
hereby created and established separate funds to be designated "City of Edgewater Utility
Revenue Bonds Sinking Fund" (hereinafter called "Sinking Fund") and the City of
Edgewater Utility Rate Stabilization Fund" (hereinafter called "Rate Stabilization Fund").
There are also hereby created and established in the Sinking Fund four accounts to be
known as the "Interest Account", "Principal Account", "Reserve Account" and "Bond
Amortization Account".
C. Disposition of Gross Revenues. All Gross Revenues at any
time remaining on deposit in the Revenue Fund shall be applied and allocated on a
monthly basis, commencing in the month immediately following the delivery of the
Bonds only in the following manner and in the following order of priority:
(1) Gross Revenues shall first be used to deposit in the
"City of Edgewater Utility System Operation and Maintenance Fund" (the "Operation
and Maintenance Fund") which fund is hereby created and established, such sums as are
necessary for payment of the Cost of Operation and Maintenance for the next ensuing
month.
(2) Gross Revenues shall next be used to deposit into the
Interest Account, such sums as will, in equal monthly installments, collectively be
sufficient to pay all interest not capitalized becoming due on the Bonds on the next
interest payment date.
(3) Gross Revenues shall next be used for deposit into the
Principal Account, in any Bond Year in which a Serial Bond matures, such sums as will,
in equal monthly installments, be sufficient to pay the principal (Maturity Amount for
Capital Appreciation Bonds) maturing on Serial Bonds in such Bond Year.
(4) (a) On a parity with required deposits under
paragraph (3) above, Gross Revenues shall next be used for deposit into the Bond
Amortization Account, in any Bond Year in which an Amortization Installment is due,
such sums as will, in equal monthly installments, be sufficient to pay the Amortization
Installment required to be made in such Bond Year. Such payments shall be credited to a
separate account for each series of Term Bonds outstanding, and if there shall be more
32
than one stated maturity for Term Bonds of a series, then into a separate special account
in the Bond Amortization Account for each such separate maturity of Term Bonds. The
funds and investments in each such separate account shall be applied to the payment of
principal of the Term Bonds of the series or maturity for which it is established, as
provided in Section 13.D herein.
(b) Upon the sale of any series of Term Bonds, the
Issuer, shall by resolution, establish the amounts and maturities of such Amortization
Installments for each series, and if there shall be more than one maturity of Term Bonds
within a series, the Amortization Installments for the Term Bonds of each maturity.
(c) Moneys on deposit in each of the separate
accounts in the Bond Amortization Account shall be used for the open market purchase
or the redemption of Term Bonds of the series or maturity of Term Bonds within a series
for which such separate account is established as provided herein.
(5) The required deposits to the Principal Account,
Interest Account and Bond Amortization Account shall be adjusted in order to take into
account the amount of money then on deposit therein or specific periodic payment
provisions set forth in any Supplemental Resolution.
(6) (a) Gross Revenues shall next be applied by the
Issuer to establish and maintain in the Reserve Account a sum equal to the Reserve
Requirement. Such sum shall be initially established and funded by deposit at the time of
issuance of any Bonds and the amount, if any, of the Reserve Requirement shall be set
forth in the applicable Supplemental Resolution with respect to such series of Bonds.
The applicable Supplemental Resolution with respect to a series of Bonds may establish a
subaccount of the Reserve Account with respect to a specific series of Bonds and may
further provide that such subaccount shall solely secure the payment of such series of
Bonds and no other Bonds.
(b) Moneys in the Reserve Account shall be used
only for the purposes of(i) the payment of maturing principal of or interest on the Bonds,
or maturing Amortization Installments, if any, when the other moneys in the Sinking
Fund are insufficient therefor, or (ii) transfers to the Revenue Fund of amounts in the
Reserve Account in excess of the Reserve Requirement.
(c) Any withdrawals from the Reserve Account
under clause (b)(i) above or any deficiency due to valuation as provided in C.(15) below
shall be subsequently restored from the first moneys available in the Revenue Fund after
all required current deposits under paragraphs (1), (2), (3) and (4) above (including all
deficiencies in prior deposits) have been made in full.
(d) Notwithstanding the foregoing provisions, in
lieu of any required deposits of Gross Revenues into the Reserve Account, the Issuer may
cause to be deposited into the Reserve Account for any series of Bonds a surety bond, a
letter of credit or an insurance policy issued by a reputable and recognized insurer for the
33
benefit of the Owners in an amount equal to the difference between the Reserve
Requirement and the sums then on deposit in the Reserve Account, if any, which surety
bond, letter of credit or insurance policy shall be payable (upon the giving of notice as
required thereunder) on any interest payment date on which a deficiency exists which
cannot be cured by funds in any other fund or account held pursuant to this Resolution
and available for such purpose. The insurer providing such surety bond or insurance
policy shall be an insurer whose municipal bond insurance policies insuring the payment,
when due, of the principal of and interest on municipal bond issues results in such issues
being rated in the two highest rating categories by either Standard & Poor's Ratings
Services or Moody's Investors Service, Inc., or their successors or any insurer who holds
one of the two highest policyholder ratings accorded insurers by A.M. Best & Co. or any
comparable service. The bank providing such letter of credit shall be a bank which is
rated in one of the two highest rating categories by either Standard & Poor's Ratings
Services or Moody's Investors Service, or their successors. If a disbursement is made
from a surety bond, letter of credit or an insurance policy provided pursuant to this
paragraph, the Issuer shall be obligated to either reinstate the maximum limits of such
surety bond, letter of credit or insurance policy immediately following such disbursement
or to deposit into the Reserve Account, as herein provided in this paragraph (6)(d) for
restoration of withdrawals from the Reserve Account, funds in the amount of the
disbursement made under such policy, or a combination of such alternatives.
(7) Upon the issuance of any Additional Parity Bonds
under the terms, limitations and conditions as are herein provided, the payments into the
several accounts in the Sinking Fund shall be increased in such amounts as shall be
necessary to make the payments for the principal of, interest on and reserves for such
Additional Parity Bonds and, if Term Bonds are issued, the Amortization Installments, on
the same basis as hereinabove provided with respect to the Bonds initially issued under
this Resolution.
(8) The Issuer shall not be required to make any further
payments into the Sinking Fund in any Bond Year when (i) the aggregate amount of
money in the Interest Account, Principal Account and Bond Amortization Account in the
Sinking Fund is at least equal to the total annual Bond Service Requirements becoming
due in such Bond Year on the Bonds then outstanding, plus the amount of redemption
premium, if any, then due and thereafter to become due in such Bond Year on such
Bonds then outstanding by operation of the Bond Amortization Account, and (ii) the full
amount of the Reserve Requirements is on deposit in the Reserve Account.
(9) Gross Revenues shall next be used to provide for
monthly payments or accruals of maturing principal of and interest on any debt of the
Issuer which is payable from Net Revenues on a junior and subordinate basis to the
Bonds.
(10) Gross Revenues shall next be deposited monthly into a
special account to be known as the "City of Edgewater Utility System Renewal and
34
Replacement Fund" (hereinafter called the "Renewal and Replacement Fund"), which
fund is hereby created and established, in an amount equal to one-twelfth (1/12) of five
per centum (5%) of the Gross Revenues of the System for the previous Fiscal Year;
provided, however, that so long as there shall be on deposit in such Renewal and
Replacement Fund a balance of at least five per centum (5%) of the value of the fixed
assets of the System, according to the most recent annual audit of the Issuer, no
additional deposits in such Fund shall be required. The moneys in the Renewal and
Replacement Fund shall be used only for the purposes of (a) paying the cost of
extensions, enlargements or additions to, or the replacement of capital assets of, the
System and emergency repairs thereto, and (b) transfers to the Reserve Account, if
necessary in order to prevent a default in the payment of the principal or Amortization
Installments of and interest on the Bonds.
(11) Gross Revenues shall next be used to transfer from the
Revenue Fund to the Rate Stabilization Fund the amount, if any, budgeted for deposit
into the Rate Stabilization Fund for then current period as set forth in the current annual
budget of the Issuer, or the amount otherwise determined by the Issuer to be credited to
the Rate Stabilization Fund for such period:
(12) Gross Revenues remaining in the Revenue Fund after
all of the above required payments have been made may be used by the Issuer for any
lawful purpose.
(13) The Operation and Maintenance Fund, the Sinking
Fund, the Renewal and Replacement Fund, the Revenue Fund, the Improvement Fund,
the Rate Stabilization Fund, and all accounts therein and any other special funds herein
established and created shall constitute trust funds for the purposes provided herein for
such funds.
(14) Monies on deposit in the Revenue Fund, the Operation
and Maintenance Fund, and the Sinking Fund (except the Reserve Account therein) may
be invested and reinvested in Authorized Investments, provided such investments either
mature or are redeemable at not less than par without penalty at the option of the Issuer
not later than the dates on which the moneys on deposit therein will be needed for the
purpose of such fund. The moneys in the Reserve Account in the Sinking Fund, in the
Rate Stabilization Fund and in the Renewal and Replacement Fund may be invested and
reinvested only in Authorized Investments in the manner provided by law, provided such
investments mature within five years of the date of purchase. All income on all such
investments shall be deposited into the Revenue Fund, except that investment income
earned in the Reserve Account shall remain therein whenever the amount on deposit
therein is less than the Reserve Requirement.
(15) Investments in the Reserve Account and the Renewal
and Replacement Fund shall be valued at their market value as of the last business day of
each Fiscal Year. In the ensuing Fiscal Year, as a result of such revaluation, (i) any
amount in the Reserve Account in excess of the Reserve Requirement may be transferred
35
to the Revenue Fund, and (ii) any deficiency in the Reserve Account shall be restored
from 12 equal monthly deposits from the Revenue Fund as provided in Subsection C(6)
hereof.
D. Operation of Bond Amortization Account. Money held
for the credit of the Bond Amortization Account, and each separate account established
therein, shall be applied to the retirement of Term Bonds as follows:
(1) The Issuer shall endeavor to purchase Term Bonds
subject to mandatory redemption in the then current Bond Year at the most advantageous
price obtainable with reasonable diligence, such price not to exceed the principal of such
Term Bonds plus the accrued interest to the date of delivery thereof, or the Accreted
Value of Capital Appreciation Term Bonds on the mandatory' redemption date. No such
purchase shall be made by the Issuer within the period of 45 days immediately preceding
any interest payment date on which Term Bonds are subject to call for mandatory
redemption.
(2) The Issuer shall call for redemption from money in the
Bond Amortization Account the amount of Term Bonds subject to mandatory
redemption, in the then current Bond Year, less the principal amount of such Term
Bonds, or Accreted Value of such Capital Appreciation Term Bonds, which have been
purchased under Subsection D(1) above.
(3) The Issuer shall pay the interest accrued on Term
Bonds (but not on Capital Appreciation Term Bonds) being purchased or redeemed to the
date of delivery or redemption from the Interest Account and the purchase or redemption
price from the Bond Amortization Account.
SECTION 14. DISBURSEMENTS FROM PROJECT FUND.
Moneys on deposit from time to time in the Project Fund shall be used to pay or reimburse
the following Project Costs:
A. Costs incurred directly or indirectly for or in connection with a
Project or a proposed or future Project or acquisition including, but not limited to, those
for preliminary planning and studies, architectural, construction management services,
legal, financial, engineering and supervisory services, labor, services, materials,
equipment, accounts receivable, acquisitions, land, rights-of-way, improvements and
installation;
B. Premiums attributable to all insurance required to be taken out and
maintained during the period of construction with respect to a Project to be acquired or
constructed, the premium on each surety bond, if any, required with respect to work on
such facilities, and taxes, assessments and other charges hereof that may become payable
during the period of construction with respect to such a Project;
C. Costs incurred directly or indirectly in seeking to enforce any
remedy against a contractor or subcontractor in respect of any default under a contract
36
relating to a Project or costs incurred directly or indirectly in defending any claim by a
contractor or subcontractor with respect to a Project;
D. Financial, legal, accounting, appraisals, title evidence and printing
and engraving fees, charges and expenses, and all other such fees, charges and expenses
incurred in connection with the authorization, sale, issuance and delivery of such series of
Bonds;
E. Capitalized interest funded from Bond proceeds, if any, for a
reasonable period of time;
F. Any other incidental and necessary costs including without
limitation any expenses, fees and charges relating to the acquisition, construction or
installation of a Project, and the making of extraordinary repairs, renewals and
replacements, decommissioning or retirement of any portion of the System, including the
cost of temporary employees of the Issuer retained to carry out duties in connection with
the acquisition, construction or erection of a Project and costs related to transition of such
Project into ownership by the Issuer;
G. Costs incurred directly or indirectly in placing any Project in
operation in order that completion of such Project may occur;
H. Costs of acquiring an existing water, wastewater or stormwater
management system from a Person, including but not limited to the costs relating to any
real estate transaction related thereto;
I. Any other costs relating to the System authorized pursuant to a
Supplemental Resolution of the Issuer and permitted under the laws of the State subject
to the prior written approval of Bond Counsel; and
J. Reimbursements to the Issuer for any of the above items
hereinbefore paid by or on behalf of the Issuer, to the extent deemed permissible by Bond
Counsel and advisable by the Financial Advisor.
Notwithstanding anything else in this Resolution to the contrary, in the
Event of Default, the trustee acting for the Holders of Bonds shall, to the extent there are
no other available funds held hereunder, use the remaining funds in each subaccount in
the Project Fund to pay principal and interest on the Series of Bonds to which it was
established.
SECTION 15. SECURITY FOR BONDS. The payment of the
principal of and interest on the Bonds shall be secured forthwith equally and ratably by a
pledge of and an irrevocable lien on the Pledged Funds. The Issuer does hereby
irrevocably pledge the Pledged Funds to the payment of the principal of and interest on
the Bonds issued pursuant to this Resolution, and to the payment therefrom into the
Sinking Fund at the times provided of the sums required to secure the payment of the
principal of and interest on the Bonds at the respective maturities of the Bonds. The
37
Bonds and interest thereon shall not be or constitute a general indebtedness of the Issuer
within the meaning of any constitutional or statutory limitation or provision, but shall be
payable solely from and secured by a lien upon and pledge of the Pledged Funds. No
Owner of any of the Bonds shall ever have the right to require or compel the exercise of
the ad valorem taxing power of the Issuer for payment of the principal of and interest on
the Bonds or the making of any sinking fund, reserve, or other payments provided for in
this Resolution. The Bonds and the obligation evidenced thereby shall not constitute a
lien upon the System, or any part thereof, or on any property of or in the Issuer, but shall
constitute a lien only on the Pledged Funds, in the manner provided herein.
SECTION 16. COVENANTS OF THE ISSUER. For as long as any
of the principal of and interest on any of the Bonds shall be outstanding and unpaid, or
until payment has been provided for as herein permitted, the Issuer covenants with the
Owners of any and all Bonds as follows:
A. Operation and Maintenance. The Issuer will maintain the
System and all parts thereof in good condition and will operate the same in an efficient
and economical manner making such expenditures for equipment and for renewals,
repairs and replacements as may be proper for the economical operation and maintenance
thereof.
B. Annual Budget. The Issuer shall annually prepare and adopt
in accordance with applicable law a detailed budget of the estimated Cost of Operation
and Maintenance of the System during each next succeeding Fiscal Year. No expenditure
for the Cost of Operation and Maintenance of the System shall be made in any Fiscal
Year in excess of the amount provided therefor in such budget without a finding and
recommendation by the duly authorized officer in charge thereof, which finding and
recommendation shall state in detail the purpose of and necessity for such increased
expenditures for the Cost of Operation and Maintenance of the System, and no such
expenditure shall be made until the governing body of the Issuer shall have approved
such finding and recommendation by resolution duly adopted. The Issuer shall, upon
request, mail copies of such annual budgets to any Owner of Bonds who shall file his
address with the Issuer and request in writing that copies of all such budgets be furnished
him, and shall make available such budgets at all reasonable times to any Owner of
Bonds or to anyone acting for and on behalf of such Owner, providing that such Owner
shall pay the reasonable cost of such documents.
C. Rate Resolution. (1) The Issuer will enact a rate resolution or
ordinance and thereby will fix, establish and maintain such rates and will collect such
fees, rentals or other charges for the services and facilities of the System and revise the
same from time to time, whenever necessary, as will always provide Gross Revenues in
each Fiscal Year sufficient to pay (a) one hundred per centum (100%) of all Costs of
Operation and Maintenance of the System in such Fiscal Year, one hundred per centum
(100%) of the payments required to be made into the Reserve Account, and Renewal and
38
Replacement Fund in such Fiscal Year, plus (b) together with all other funds pledged to
secure junior lien debt, one hundred per centum (100%) of all Bond Service
Requirements becoming due in such Fiscal Year on all outstanding obligations payable
from the Net Revenues of the System which are junior and subordinate as to lien on and
pledge of such Net Revenues to the lien and pledge securing payment of the Bonds, plus
(c) one hundred ten per cent (110%) of the Bond Service Requirement becoming due in
such year on the Bonds. The Issuer will not reduce its schedule of rates, fees, rentals and
other charges unless (i) the Issuer is not in default of any covenant or provision of this
Resolution, (ii) all required payments under this Resolution have been made in full, and
(iii) the Rate Consultant certifies that the proposed reduced schedule will provide
sufficient Gross Revenues in each Fiscal Year to comply with all covenants and required
payments under this Resolution. For the purposes of determining compliance with this
Section 16.C., transfers from the Rate Stabilization Fund to the Revenue Fund shall be
included.
(2) Whenever Gross Revenues are less in any Fiscal Year
than the amount required in Subsection G(1) above, the Issuer will promptly retain a Rate
Consultant to prepare and present to the governing body of the Issuer a rate study
recommending such revisions in rates, fees, rentals and other charges for the services and
facilities of the System as will, in the opinion of the Rate Consultant, generate Gross
Revenues sufficient to meet such requirements in each of the next five (5) full Fiscal
Years. The Issuer will implement the recommendations of the Rate Consultant or, with
the concurrence of the Rate Consultants, such other rate revisions as the Issuer may find
will generate such sufficient Gross Revenues.
D. Books and Records. The Issuer shall keep books and records
of the Pledged Funds and the financial affairs of the System which shall be kept separate
and apart from all other books, records and accounts of the Issuer, and the Owners of the
Bonds shall have the right at all reasonable times to inspect all records, accounts and data
of the Issuer relating thereto.
E. Annual Audit. The Issuer shall, at least once a year, within
120 days after the close of its Fiscal Year, cause the books, records and accounts relating
to the System to be properly audited by a recognized independent firm of certified public
accountants and shall make generally available the report of such audits to any Owner of
Bonds. Such audits shall contain a complete report of the operations of the System
including, the balance sheet, a statement of income and expense, the statement of changes
in cash flow, and a certificate by the auditors stating no default on the part of the Issuer of
any covenant herein has been disclosed by reason of the audit (or a statement specifying
such default). The auditors selected shall be changed at any time by a written request
signed by the Owners of a majority of the principal amount (Accreted Value for Capital
Appreciation Bonds) of the Bonds and Notes outstanding or their duly authorized
representatives. A copy of such annual audit shall be furnished to any rating services
maintaining a rating on the Bonds and to any Owner of any Bonds who shall have
requested in writing that a copy of such reports be furnished him.
39
F. No Mortgage or Sale of the System.
(1) The Issuer will not sell, lease, mortgage, pledge or
otherwise encumber the System, or any substantial part thereof, or any revenues to be
derived therefrom, except as herein provided.
(2) (a) The Issuer shall have and hereby reserves the
right to sell, lease or otherwise dispose of any of the property comprising a part of the
System which the Issuer shall hereafter determine, in the manner provided herein, to be
no longer necessary, useful or profitable in the operation of the System.
(b) Prior to any such sale, lease or other disposition
of said property, if the amount to be received therefor is not in excess of 550,000, the
City Manager of the Issuer or other duly authorized officer in charge thereof shall make a
finding in writing determining that such property comprising a part of the System is no
longer necessary, useful or profitable in the operation thereof
(c) If the amount to be received from such sale,
lease or other disposition of said property shall be in excess of$50,000 but not in excess
of $100,000 such City Manager or other officer shall first make a finding in writing
determining that such property comprising a part of the System is no longer necessary,
useful or profitable in the operation thereof, and the governing body of the Issuer shall,
by resolution duly adopted, approve and concur in the finding of the City Manager or
other officer, and authorize such sale, lease or other disposition of said property.
(d) If the amount to be received from such sale,
lease or other disposition of said property shall be in excess of $100,000, the City
Manager or other officer shall first make a finding in writing determining that such
property comprising a part of the System is no longer necessary, useful or profitable in
the operation thereof, and the Consulting Engineer shall make a finding that it is in the
best interest of the System that such property be disposed of, and the governing body of
the Issuer shall by resolution, duly adopted, approve and concur in the findings of the
City Manager or other officer and of the Consulting Engineer, and shall authorize such
sale, lease or other disposition of said property.
(3) The governing body of the Issuer shall have and
reserves the right to authorize the sale or other disposition of any of the property
comprising a part of the System, if the Rate Consultant shall certify that the Net
Revenues of the System will not be materially adversely affected by reason of such sale
or disposition.
(4) If the proceeds derived from any sale or other
disposition of the property of the System are in excess of 10% of the value of the fixed
assets of the System according to the most recent annual audit, such proceeds shall be
used for the retirement of Outstanding Bonds. If the proceeds derived from any such sale
or other disposition of property are less than 10% of the value of the fixed assets of the
System according to the most recent annual audit, such proceeds shall be placed in the
40
Renewal and Replacement Fund or used for the retirement of outstanding Bonds, in such
proportions as are determined by the governing body of the Issuer upon the
recommendations of the City Manager. The payment of such proceeds into the Renewal
and Replacement Fund shall not reduce the amounts required to be paid into such Fund
by Section 13.C.(10) herein.
G. Insurance. The Issuer will carry adequate fire and windstorm
insurance on all buildings and structures of the works and properties of the System which
are subject to loss through fire or windstorm, and will otherwise carry insurance of all
kinds and in the amounts normally carried in the operation of similar facilities and
properties in Florida; provided, however, that in lieu of such insurance the Issuer may
establish a qualified plan of self-insurance in accordance with the laws of the State of
Florida. Any such insurance shall be carried for the benefit of the Owners of the Bonds.
All moneys received for losses under any of such insurance, except public liability, are
hereby pledged by the Issuer as security for the Bonds and Notes, until and unless such
proceeds are used to remedy the loss or damage for which such proceeds are received,
either by repairing the property damaged or replacing the property destroyed as soon as
practicable. Any such proceeds not used for repair or replacement shall be used for the
retirement of outstanding Bonds.
H. No Free Service. The Issuer will not render or cause to be
rendered any free services of any nature by its System, nor will any preferential rates be
established for users of the same class. Whenever the Issuer, including its departments,
agencies and instrumentalities, shall avail itself of the product, facilities or services
provided by the System, or any part thereof, the same rates, fees or charges applicable to
other customers receiving like services under similar circumstances shall be charged to
the Issuer and any such department, agency or instrumentality. Such charges shall be
paid as they accrue, and the Issuer shall transfer from its general funds to the Revenue
Fund sufficient sums to pay such charges. The revenues so received shall be deemed to
be Gross Revenues derived from the operation of the System, and shall be deposited and
accounted for in the same manner as other Gross Revenues derived from such operation
of the System.
I. Mandatory Cut Off. To the extent permitted by law, upon
failure of any user to pay for services rendered by the System within not more than sixty
(60) days, the Issuer shall shut off the connection of such user and shall not furnish him
or permit him to receive from the System further service until all obligations owed by
him to the Issuer on account of services shall have been paid in full. This covenant shall
not, however, prevent the Issuer from causing the System connection to be shut off
sooner.
J. Enforcement of Collections. The Issuer will diligently
enforce and collect the rates, fees and other charges for the services and facilities of the
System herein pledged: will take all steps, actions and proceedings for the enforcement
and collection of such rates, charges and fees as shall become delinquent to the full extent
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permitted or authorized by law: and will maintain accurate records with respect thereof.
All such fees, rates, charges and revenues herein pledged shall, as collected, be held in
trust to be applied as herein provided and not otherwise.
K. Consulting Engineer.
(1) The Consulting Engineer shall provide the Issuer with
competent advice respecting the proper, efficient and economical operation and
maintenance of the System and the making of capital improvements and renewals and
replacements to the System. The Issuer shall, on an annual basis prior to completion of a
System Project, and on a triennial basis thereafter, cause to be prepared by the Consulting
Engineer a report or survey of the System, with respect to the management of the
properties thereof, the proper maintenance of the properties of the System, and the
necessity for capital improvements and recommendations therefor. Such a report or
survey shall also show any failure of the Issuer to perform or comply with the covenants
herein contained.
(2) If any such report or survey of the Consulting Engineer
shall set forth that the provisions hereof or any reasonable recommendations of such
Consulting Engineer have not been complied with, the Issuer shall immediately take such
reasonable steps as are necessary to comply with such requirements and
recommendations. Copies of each report or survey shall be placed on file with the City
Manager and shall be open to the inspection of any Owner of Bonds.
L. No Competing System. To the full extent permitted by law,
the Issuer will not hereafter grant, or cause, consent to, or allow the granting of, any
franchise or permit to any person, firm, corporation or body, or agency or instrumentality
whatsoever, for the furnishing of water or wastewater services to or within the boundaries
of the Issuer.
M. Issuance of Other Obligations. Except for the Bonds, the
Issuer will not issue any other obligations payable from the Pledged Funds nor
voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance
or other charge having priority to or being on a parity with the lien of the Bonds and the
interest thereon upon Pledged Funds, except under the conditions and in the manner
provided in Subsection R below. Any obligations issued by the Issuer other than the
Bonds herein authorized and Additional Parity Bonds provided for in Subsection R
below, payable from Pledged Funds, shall contain an express statement that such
obligations are junior and subordinate in all respects to the Bonds, as to lien on and
source and security for payment from Pledged Funds.
N. Issuance of Additional Parity Bonds. Additional Parity
Bonds, payable on a parity from the Pledged Funds with any Outstanding Bonds, may be
issued to finance Projects or for refunding purposes and upon the conditions and in the
manner herein provided:
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(1) There shall have been obtained and filed with the
Issuer a certificate of an independent certified public accountant or firm of such
accountants of suitable experience and responsibility: (a) stating that the books and
records of the Issuer relating to the collection and receipt and application of Gross
Revenues have been audited by it for the Fiscal Year immediately preceding the date of
delivery of the proposed Additional Parity Bonds, or for any twelve (12) consecutive
months period out of the eighteen (18) consecutive months immediately preceding the
date of sale of the proposed Additional Parity Bonds; (b) setting forth the amount of Net
Revenues received by the Issuer for the audited period referred to in (a) above, with
respect to which such certificate is made; (c) stating that the Net Revenues described in
(b) above, as adjusted in the manner permitted in Subsection N(2) below, equal at least
1.10 times the Maximum Bond Service Requirements coming due in any future Bond
Year on all Bonds then Outstanding and on the proposed Additional Parity Bonds with
respect to which such certificate is made. For the purposes of determining compliance
with this Section 16.N.(1), transfers from the Rate Stabilization Fund to the Revenue
Fund shall not be included.
(2) The Net Revenues for such period may be adjusted by
the Issuer (based upon the written advice of the Rate Consultants, as appropriate) as
follows: (a) to reflect for such period changes made in the rates, fees, rentals and other
charges from the operation of the System which are in effect before the date of such
certificate, as though such changes had been in effect during all of such preceding audited
period referred to in Subsection N(1) above; (b) to reflect for such period any change in
such Net Revenues caused by any new facilities of or improvements to the System having
been placed into use and operation subsequent to the date of commencement of such
period and prior to the date of such certificate provided for in Subsection N(1) above; (c)
to include for such period an amount equal to not more than 75% the Net Revenues
estimated to be derived from the operation of any facilities or improvements which will
be placed in operation within 3 years following the date of delivery of and to be acquired
or constructed out of the proceeds of such Additional Parity Bonds during the first Fiscal
Year commencing after such facilities or improvements are first placed in operation: (d)
to include for such period an amount equal to not more than 75% of the Net Revenues
estimated to be derived from the operation of any other facilities or improvements of the
System, actually under construction but which will not be placed into use and operation
until after the date of issuance (but in no event later than three years after such date) of
such Additional Parity Bonds, during the first Fiscal Year commencing after such
facilities or improvements are first placed in service; and (e) to include for such period
interest income estimated to be earned during the ensuing Fiscal Year on moneys
deposited into the Reserve Account from a portion of the proceeds of such Additional
Parity Bonds.
(3) Each ordinance or resolution authorizing the issuance
of Additional Parity Bonds shall recite that all of the covenants herein contained will be
applicable to such Additional Parity Bonds.
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(4) The Issuer shall not be in default in performing any of
the covenants and obligations assumed hereunder, and all payments herein required to
have been made into the accounts and funds, as provided hereunder, shall have been
made to the full extent required.
(5) Refunding Bonds for the purpose of refunding all of
the then outstanding Bonds may be issued without compliance with any of the above
paragraphs (1) through (4) of this Subsection N. Refunding Bonds for the purpose of
refunding all or part of any series of the then Outstanding Bonds, but less than all then
Outstanding Bonds, may be issued without compliance with paragraphs (1), (2) and (4),
above, provided that the annual Bond Service Requirement on all Bonds outstanding after
issuance of the refunding bonds, in each Bond Year in which any principal of or interest
on the Bonds outstanding immediately prior to issuance of the refunding bonds is due or
subject to mandatory redemption, is equal to or less than the annual Bond Service
Requirement in each such corresponding Bond Year prior to issuance of such refunding
bonds.
O. Creation of Superior Liens; Subordinate Liens. The Issuer
will not issue any other notes, bonds, certificates or obligations of any kind or nature or
create or cause or permit to be created any debt, lien, pledge, assignment or encumbrance
or charge payable from or enjoying a lien upon any of the Pledged Funds ranking prior
and superior to the lien created by this Resolution for the benefit of the Bonds. The
Issuer may issue notes, bonds, certificates or obligations of any kind or nature or create or
cause or permit to be created any debt, lien, pledge, assignment or encumbrance or
charge payable from or enjoying a lien upon Pledged Funds that is subordinate to the lien
on Pledged Funds securing the Bonds. Any such notes, bonds, certificates or obligations
issued by the Issuer with a subordinate lien on Pledged Funds shall expressly state that
the subordinate nature of the lien on Pledged Funds securing such notes, bonds,
certificates or obligations.
P. Compliance with Laws and Regulation. The Issuer will
perform and comply with, in every respect, any loan agreement which it might have with
any governmental agency and all applicable Federal and State laws and regulations
respecting the Bonds and the ownership and operation of the System.
Q. Fidelity Bond. The Issuer will require each employee who
may have possession of any Pledged Funds to be covered by a fidelity bond written by a
responsible indemnity company in an amount fully adequate to protect the Issuer from
loss.
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R. Rate Stabilization Fund.
(1) Each month the Issuer shall transfer from the Rate
Stabilization Fund to the Revenue Fund the amount budgeted, if any, for transfer into the
Revenue Fund for the then current month as set forth in the current annual budget or the
amount otherwise determined by the Issuer to be deposited into the Revenue Fund for the
month.
(2) At any time and from time to time the Issuer may
transfer for deposit in the Rate Stabilization Fund from any lawful source (other than
Gross Revenues) such amounts as the Issuer deems necessary or desirable; such amounts
shall be applied for purposes of the Rate Stabilization Fund in accordance with paragraph
(I) of this Subsection R.
S. Impact Fees. The Issuer shall cause its Consulting Engineer
upon the issuance of each series of Bonds, to calculate the New User Facilities Portion,
the Impact Fees Percentage and the aggregate Allowable Impact Fees for such series of
Bonds. Separate calculations shall be made for water projects and water Impact Fees, for
wastewater projects and wastewater Impact Fees, and to the extent permitted by
applicable law, for stormwater projects and stormwater Impact Fees. Impact Fees, as
received, shall first be deposited into the Utility System Capital Improvement Fund (the
"Improvement Fund"). Water Impact Fees, wastewater Impact Fees and if applicable,
stormwater Impact Fees shall be maintained in separate accounts in the Improvement
Fund. If necessary in order to make the deposits required by Subsection 13C, clauses (1)
through (7), inclusive, the Issuer shall or, if not so required, the Issuer may, in lieu of
required deposits of Gross Revenues, make monthly withdrawals from each account in
the Improvement Fund and apply such moneys to the Sinking Fund to be used solely for
the purposes of the Sinking Fund; provided that the aggregate amount of such
withdrawals from each account in the Improvement Fund in any Fiscal Year does not
exceed the sum of the Allowable Impact Fees for each series of Bonds for such Fiscal
Year. Moneys on deposit in each account in the Improvement Fund in excess of the
Allowable Impact Fees in each Fiscal Year shall be used by the Issuer for any lawful
purpose. Pending their application, all Impact Fees on deposit in the Improvement Fund
may be invested and reinvested in Authorized Investments maturing, in the case of
Allowable Impact Fees, at the times and in the amounts such moneys are required or
intended to be transferred to the Sinking Fund, and in the case of other Impact Fees, at
such time as the Issuer shall determine. The income on such investments shall remain in
the Improvement Fund and be applied for any lawful purpose.
SECTION 17. FUNDS AND ACCOUNTS. The cash required to be
accounted for in each of the funds and accounts established herein shall be deposited in
separate and segregated bank accounts, and adequate accounting records shall be
maintained to reflect and control the restricted allocation of the cash on deposit therein
for the various purposes of such funds as herein provided.
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The designation and establishment of the various funds in and by this
Resolution shall not be construed to require the establishment of any completely
independent, self-balancing funds as such term is commonly defined and used in
governmental accounting, but rather is intended solely to constitute an earmarking of
certain revenues and assets of the System for certain purposes and to establish certain
priorities for application of such revenues and assets as herein provided. The Issuer may
by Supplemental Resolution adopt one or more accounts or subaccounts with respect to
the Funds and Accounts established hereunder.
SECTION 18. DEFAULT AND REMEDIES. If:
A. the Issuer shall fail to pay the principal of or interest, or
premium, if any, on any of the Bonds as the same shall become due;
B. the Issuer shall fail in the observance or performance of any
of the applicable covenants contained herein (other than set forth in (1) above) or set
forth in a Supplemental Resolution and fails to cure the same within thirty (30) days;
C. a petition is filed by or against the Issuer relating to
bankruptcy, reorganization, arrangement or readjustment of debt of the Issuer or for any
other relief relating to the Issuer under the United States Bankruptcy Code, as amended,
or any other insolvency act or law now or hereafter existing, or if a receiver or trustee is
involuntarily appointed for the Issuer, and any such event continues undismissed or
undischarged for 90 days;
D. a default or event of default occurs with respect to any other
notes, bonds, certificates or obligations that are then Outstanding and secured by a pledge
of or lien on Pledged Funds, or the amounts due under any such notes, bonds, certificates
or obligations are accelerated; or
E. this Resolution, any Supplemental Resolution or any Bond
issued under this Resolution or any Supplemental Resolution is determined by a court of
competent jurisdiction to be invalid or unenforceable, or the Issuer shall contest the
validity or enforceability of the same;
then, in addition to any other remedies provided by Supplemental Resolution, any Owner
of Bonds may either at law or in equity, by suit, action, mandamus or other proceedings
in any court of competent jurisdiction, protect and enforce any and all rights, including
the right to the appointment of a receiver, existing under the laws of the State of Florida,
or granted and contained herein, and may enforce and compel the performance of all
duties required herein or by any applicable statutes relating to the System or the Bonds to
be performed by the Issuer or by any officer thereof and shall have such additional rights
and remedies as may be set forth in the applicable Supplemental Resolution. Nothing
herein, however, shall be construed to grant to any Owner of the Bonds any lien on the
System or any other real or tangible personal property of the Issuer.
46
SECTION 19. TAX CODE; ERISA.
A. The Issuer at all relevant times while the Bonds are
outstanding and with respect to any series of Bonds, the interest on which is excluded
from gross income for federal income tax purposes, will comply with the requirements of
the Tax Code in order that interest on the Bonds shall be excluded from gross income for
federal income tax purposes, including, in particular,the payment of any amount required
to be rebated to the U.S. Treasury pursuant to the Tax Code.
B. The Issuer covenants with the Holders of each series of
Bonds, the interest on which is excluded from gross income for federal income tax
purposes, that neither the Issuer nor any Person under its control or direction will make
any use of the proceeds of such series of Bonds (or amounts deemed to be proceeds under
the Tax Code) in any manner which would cause such series of Bonds to be "arbitrage
bonds" within the meaning of Section 148 of the Tax Code and neither the Issuer nor any
other Person shall do any act or fail to do any act which would cause the interest on such
series of Bonds to become includable in the gross income of the Holder thereof for
federal income tax purposes.
C. The Issuer may, if it so elects, issue one or more series of
taxable Bonds the interest on which is (or may be) includable in the gross income of the
Holder thereof for federal income tax purposes, so long as each Bond of such series states
in the body thereof that interest payable thereon is (or may be) subject to federal income
taxation and provided that the issuance thereof will not cause the interest on any other
Bonds theretofore issued hereunder to be or become includable in the gross income of the
Holder thereof for federal income tax purposes. The covenants set forth in paragraphs
(A) and(B) above shall not apply to any taxable Bonds.
D. There is hereby created and established a fund to be known as
the "City of Edgewater Utility System Revenue Bonds Rebate Fund" (the "Rebate
Fund"), and a separate account therein for each series of Bonds. The Issuer shall deposit
into the appropriate account in the Rebate Fund, from investment earnings on moneys
deposited in the other funds and accounts created hereunder, or from any other legally
available funds of the Issuer, an amount equal to the Rebate Amount for such Rebate
Year. The Issuer shall use such moneys deposited in the appropriate account in the
Rebate Fund only for the payment of the Rebate Amount to the United States as required
by this Section 19. In complying with the foregoing, the Issuer may rely upon any
instructions or opinions from its qualified rebate analyst.
If any amount shall remain in the Rebate Fund after payment in full
of all Bonds issued hereunder that are not taxable Bonds and after payment in full of the
Rebate Amount to the United States in accordance with the terms hereof, such amounts
shall be available to the Issuer for any lawful purpose.
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The Rebate Fund shall be held separate and apart from all other
funds and accounts of the Issuer, shall not be impressed with a lien in favor of the
Bondholders, and the moneys therein shall be available for use only as herein provided.
E. To the extent applicable to the Issuer, the Issuer: (1) has
fulfilled its obligations, if any, under the minimum funding standards of ERISA and the
Tax Code with respect to each Plan; (2) is in compliance in all material respects with the
presently applicable provisions of ERISA and the Tax Code, and has not incurred any
liability to the Pension Benefit Guaranty Corporation or a Plan under Title IV of ERISA;
(3) has not incurred any withdrawal liability with respect to any Multiemployer Plan
under Title IV of ERISA, and no such liability is expected to be incurred; and (4) has not
participated in a prohibited transaction, as defined in Section 406 of ERISA or Section
4975(c) of the Tax Code, which could subject the Issuer to any material civil penalty
under ERISA or material tax under the Tax Code.
SECTION 20. DEFEASANCE. If, at any time, the Issuer shall have
paid, or shall have made provision for payment of, the principal, interest. Amortization
Installments and redemption premiums, if any, with respect to all or any of the Bonds,
then, and in that event, with respect to the Bonds to be defeased, the pledge of and lien on
the Pledged Funds, and all other covenants and pledges made in this Resolution in favor
of the Owners of such Bonds shall no longer be in effect. For purposes of the preceding
sentence, deposit of cash and/or Federal Securities in irrevocable trust with a banking
institution or trust company, for the sole benefit of the Owners of the Bonds to be
defeased, in respect to which such Federal Securities, the principal and interest received
will be sufficient to make timely payment of the principal, interest, Amortization
Installments and redemption premiums, if any, on such Bonds, shall be considered
"provision for payment". Nothing herein shall be deemed to require the Issuer to call any
of the outstanding Bonds for redemption prior to maturity pursuant to any applicable
optional redemption provisions, or to impair the discretion of the Issuer in determining
whether to exercise any such option for early redemption.
SECTION 21. MODIFICATION OR AMENDMENT. No
modification or amendment of this Resolution or of any resolution amendatory hereof or
supplemental hereto which is materially adverse to the Owners of the Bonds may be
made without the consent in writing of the Owners of two-thirds or more in the principal
amount of the Bonds (Accreted Value for Capital Appreciation Bonds) then outstanding;
provided, however, that no modification or amendment shall permit a change in the
redemption provisions or maturity of such Bonds or a reduction in the rate of interest
thereon or in the amount of the principal obligation thereof or affecting the promise of the
Issuer to pay the principal of and interest on the Bonds as the same shall become due
from the Pledged Funds or reduce the percentage of the Owners of the Bonds required to
consent to any material modification or amendment hereof without the consent of the
Owners of all such Bonds.
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SECTION 22. SEVERABILITY OF INVALID PROVISIONS. If
any one or more of the covenants, agreements, or provisions herein contained shall be
held contrary to any express provision of law or contrary to the policy of express law,
though not expressly prohibited, or against public policy, or shall for any reason
whatsoever be held invalid, then such covenants, agreements or provisions shall be null
and void and shall be deemed separable from the remaining covenants, agreements or
provisions and shall in no way affect the validity of any of the other provisions hereof or
of the Notes and Bonds issued hereunder.
SECTION 23. SALE OF BONDS. The Bonds shall be issued and
sold in such manner and at such price or prices consistent with the Act, all at one time or
in installments from time to time, as shall be hereafter determined by Supplemental
Resolution of the governing body of the Issuer.
SECTION 24. VALIDATION AUTHORIZED. The City Attorney
and Bond Counsel for the Issuer are authorized to prepare and file proceedings to validate
the Notes and Bonds in the manner provided by law, if in their discretion the Bonds or
any series thereof should be validated.
SECTION 25. CAPITAL APPRECIATION BONDS. For the
purposes of(i) receiving payment of the redemption price if a Capital Appreciation Bond
is redeemed prior to maturity, or(ii) receiving payment of a Capital Appreciation Bond if
the principal of all Bonds is declared immediately due and payable under the provisions
of this Resolution, or (iii) computing the amount of Bonds held by the registered owner
of a Capital Appreciation Bond in giving to the Issuer any notice, consent, request or
demand pursuant to this Resolution for any purpose whatsoever, the principal amount of
a Capital Appreciation Bond shall be deemed to be its Accreted Value.
SECTION 26. SUPPLEMENTAL ORDLNANCES AND
RESOLUTIONS WITHOUT THE CONSENT OF THE HOLDERS. The Issuer may,
from time to time and at any time, adopt such ordinances or resolutions as shall not be
inconsistent with the terms and conditions of this Resolution:
A. To cure any ambiguity, defect, or omission in this Resolution;
B. To secure, extend or renew to the holders of the Bonds the pledges
made herein for the payment of the Bonds and the interest to accrue thereon; and
C. To authorize the issuance of Additional Parity Bonds.
SECTION 27. GOVERNMENTAL REORGANIZATION.
Notwithstanding any other provisions of this Resolution, this Resolution shall not prevent
any lawful reorganization of the governmental structure of the Issuer or the System,
including a merger or consolidation of the Issuer or the System with another public body
or the transfer of a public function of the Issuer to another public body, provided that any
49
reorganization which affects the System shall provide that the System shall be continued
as a single enterprise and that any public body which succeeds to the ownership and
operation of the System shall also assume all rights, powers, obligations, duties and
liabilities of the Issuer under this Resolution and pertaining to all Bonds.
SECTION 28. ADDITIONAL RIGHTS TO INSURERS. All
notices required to be given to any party hereunder shall also be given to the Insurer.
Pursuant to one or more Supplemental Resolutions, the Issuer may provide additional
rights, covenants, agreements and restrictions relating to any Insurer and any Bond
Insurance Policy.
SECTION 29. PAYMENTS TO CREDIT FACILITY. In
connection with any Bonds, the Issuer may obtain or cause to be obtained one or more
Credit Facilities and agree with any Credit Facility Issuer to reimburse such issuer
directly for amounts paid under the terms of such Credit Facility, together with interest
thereof; provided, however, that no obligation to reimburse a Credit Facility Issuer shall
be created, for purposes of this Resolution, until amounts are paid under such Credit
Facility. Such payments are referred to herein as "Reimbursement Obligations." Any
Reimbursement Obligation may be secured by a pledge of and a lien on the Pledged
Revenues as may be provided in the Supplemental Resolution for the series of Bonds to
which such Credit Facility relates.
SECTION 30. SEVERABILITY. If any one or more of the
covenants, agreements .or provisions of this Resolution should be held contrary to any
express provision of law or contrary to the policy of express law, though not expressly
prohibited or against public policy, or shall for any reason whatsoever be held invalid or
shall in any manner be held to adversely affect the validity of the Bonds, then such
covenants, agreements or provisions shall be null and void and shall be deemed separate
from the remaining covenants, agreements or provisions of this Resolution or of the
Bonds issued hereunder.
SECTION 31. SALE OF BONDS. The Bonds may be issued and
sold at public or private sale at one time or in installments from time to time and at such
price or prices as shall be consistent with the provisions of the requirements of this
Resolution and other applicable provisions of law.
SECTION 32. REPEALING .CLAUSE. All resolutions or parts
thereof of the Issuer in conflict with the provisions herein contained are, to the extent of
such conflict, hereby superseded and repealed.
SECTION 33. NO THIRD PARTY BENEFICIARIES. Except
such other Persons as may be expressly described herein, in the Bonds, nothing in this
Resolution, or in the Bonds, expressed or implied, is intended or shall be construed to
confer upon any Person, other than the Issuer and the Holders, any right, remedy or
50
claim, legal or equitable, under and by reason of this Resolution or any provision hereof,
or of the Bonds, all provisions hereof and thereof being intended to be and being for the
sole and exclusive benefit of the Issuer and the Persons who shall from time to time be
the Holders.
SECTION 34. NO PERSONAL LIABILITY. Neither the members
of the City Council of the Issuer, any Person executing the Bonds, nor any other officers
or employees of the Issuer shall be personally liable therefor or be subject to any personal
liability or accountability, by reason of the issuance thereof
SECTION 35. EFFECTIVE DATE. This Resolution shall become
effective upon the later of its adoption or the defeasance, prepayment or payment in full
of all of the outstanding Existing Debt under the Issuers prior water and wastewater bond
resolution, or the receipt of the written consent of the holders of such Existing Debt to the
exchange of bonds or evidences of indebtedness under such prior resolution for Bonds
issued under this Resolution.
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Motion to approve was made by ,—.),4...5 i.a. ,A,3 with
second by 33r...te.cr) during the City Council
meeting held this '.-) +II day of Velr-L,C4. , 2016.
AYE NAY
Mayor Mike Ignasiak
Councilwoman Christine Power N.
Councilwoman Gigi Bennington
Councilman Dan Blazi
Councilman Gary Conroy
PASSED AND DULY ADOPTED this -/I day of ‘.1:=2,nC. , 2016.
- ATTEST: CITY COUNCIL OF THE
CITY OF EDGEWATER7
LORI.
--411`Ths—`5:11—*Lcz).4..c-H' ByAL1
Robin L. atusick Mike Ignasiak
Interim City Clerk/Paralegal Mayor
AP OV TO�: ' :
Aaron R. Wolfeit. •
City Attorney
For the use and reliance only by the City of Edgewater, Approved by the City Council of the City.oqf Edgewater
Florida. Approved as to form and legality by: at a meeting held on this A--)14> day of
Aaron R.Wolfe,Esquire , 2016 under Agenda Item No
City Attorney 8
Doran,Sims,Wolfe&Ciocchetti
52