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2017-R-21
CITY OF EDGEWATER, FLORIDA $2,000,000 CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 June 19, 2017 INDEX OF CLOSING DOCUMENTS BASIC DOCUMENTS: 1. Certified Copy of Resolution No. 2017-R-21, adopted on June 15, 2017 2. Capital Improvement Revenue Note, Series 2017 3. Loan Agreement 4. Opinion of Broad and Cassel, Bond Counsel 5. Opinion of Doran Sims Wolfe & Ciocchetti, Issuer's Counsel DELIVERIES BY THE CITY: 6. Certificate as to Signatures, No Litigation, Incumbency and Other Matters 7. Certificate as to Public Meetings 8. Certificate of Delivery, Payment and Application of Proceeds 9. IRS Form 8038-G 10. Tax Certificate 11. Bank Qualified Certificate DELIVERIES BY THE BANK: 12. Receipt for Note 13. Disclosure Letter 14. Bank's Certificate MISCELLANEOUS DOCUMENTS: 15. Notice of Sale to Division of Bond Finance 16. Bond Finance Forms 2003 and 2004-B 17. Closing Memorandum Distribution: (1) City of Edgewater, Florida (1) Doran Sims Wolfe & Ciocchetti (1) Broad and Cassel (1) Branch Banking and Trust Company (1) Edwards Cohen (1) First Southwest, Orlando CERTIFICATE AS TO RESOLUTION I, Robin L. Matusick, City Clerk of the City of Edgewater, Florida (the "City"), DO HEREBY CERTIFY that attached hereto as Exhibit A is a copy of Resolution No. 2017-R-21, adopted at a meeting of the City Council of the City duly called and held on June 15, 2017, at which meeting a quorum was present and acting throughout, which resolution is a true, complete and correct copy thereof, and said resolution has been duly adopted and has not been modified, amended or repealed and is in full force and effect on and as of the date hereof in the form attached hereto. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City as of this 19th day of June, 2017. (SEAL) 4849-8836-6666.2 43699/0009 CITY OF EDGEWATER, FLORIDA By: Robin L. Matusick, City Clerk EXHIBIT A RESOLUTION NO. 2017-R-21 [Attached] 4849-8836-6666.2 43699/0009 RESOLUTION NO. 2017-R-21 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EDGEWATER, FLORIDA, AUTHORIZING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT WITH BRANCH BANKING AND TRUST COMPANY, A NORTH CAROLINA STATE BANKING CORPORATION, TO PROVIDE THE CITY WITH A LOAN IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $2,000,000 TO FINANCE THE ACQUISITION OF APPROXIMATELY 27 ACRES OF LAND FOR THE CONSTRUCTION OF A PUBLIC WATERFRONT PARK AND RELATED AMENITIES; AUTHORIZING THE ISSUANCE OF A CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $21000,000 TO SECURE THE REPAYMENT OF SAID LOAN; PROVIDING FOR PAYMENT OF PRINCIPAL AND INTEREST ON SAID NOTE FROM PLEDGED REVENUES; DESIGNATING THE NOTE AS A QUALIFIED TAX-EXEMPT OBLIGATION WITHIN THE MEANING OF THE INTERNAL REVENUE CODE; MAKING CERTAIN OTHER COVENANTS AND AGREEMENTS IN CONNECTION WITH SAID LOAN; PROVIDING GENERAL AUTHORITY AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF EDGEWATER, FLORIDA: SECTION 1. AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted pursuant to the authority of Chapter 166, Florida Statutes, as amended, and other applicable provisions of law (collectively, the "Act"). SECTION 2. FINDINGS. It is hereby ascertained, detennined and declared: (A) The City of Edgewater, Florida (the "City"), deems it necessary, desirable and in the best interests of the City that the City undertake the acquisition of approximately 27 acres of land for the purpose of constructing a public waterfront park, including a boat ramp, playground, fishing piers and related amenities, and pay related costs of issuance of the Note, as hereinafter defined (collectively the "Project"). (B) On June 5, 2017, the City approved the proposal for a loan in the not to exceed amount of $2,000,000 (the "Loan") from Branch Banking and Trust, a North Carolina state banking corporation (the "Bank"), the proceeds of which will be applied to finance the cost of the Project. (C) The Loan will be evidenced by the Loan Agreement, as hereinafter defined, pursuant to which the City will issue its not to exceed $2,000,000 Capital Improvement Revenue Note, Series 2017 (the "Note") to secure the repayment of the Loan and to finance the Project. (D) The City issued a request for proposals ("RFP") to provide the Loan, advertised notice of the RFP in a newspaper of general circulation in the City, analyzed the responses received with the City's financial advisor and selected the financial institution providing the most competitive proposal and lowest interest rate for the Note and, accordingly, the City Council finds and determines that it is in the best financial interest of the City that the sale of the Note be awarded pursuant to this competitive process. (E) Debt service on the Note will be paid from the proceeds of the "local government half -cent sales tax," as defined and described in, and distributed to the City under Chapter 218, Part VI, Florida Statutes as amended and supplemented from time to time (the "Pledged Revenues"). The Pledged Revenues are expected to be sufficient to pay the principal and interest on the Note, as the same becomes due. (F) The Note shall not be or constitute a general indebtedness of the City 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 Revenues. No owner of the Note shall ever have the right to require or compel the exercise of the ad valorem taxing power of the City for payment of the principal of and interest on the Note, or other payments provided for in this Resolution. The Note and the obligation evidenced thereby shall not constitute a lien upon the Project or any property of or in the City, except the Pledged Revenues, and shall constitute a lien only on the Pledged Revenues, in the manner provided herein and in the Loan Agreement. (G) The City has not and does not reasonably expect to issue (including issues "on behalf of the City, as determined under Section 265(b)(3)(E) of the Internal Revenue Code of 1986, as amended (the "Code")) tax-exempt obligations (excluding certain obligations of the City issued for the sole purpose of currently refunding the outstanding amount of an existing obligation) in excess of $10,000,000 aggregate face amount during the 2017 calendar year. SECTION 3. AUTHORIZATION OF THE PROJECT. The City does hereby authorize the Project. SECTION 4. AUTHORIZATION OF LOAN AGREEMENT. The Loan and the repayment of the Loan by the City shall be pursuant to the terms and provisions of a Loan Agreement between the City and the Bank (the "Loan Agreement"). The City hereby authorizes the Mayor or the Vice Mayor of the City (the "Mayor") and the City Clerk or the Assistant City Clerk of the City (the "City Clerk'') to execute and deliver on behalf of the City the Loan Agreement, substantially in the form attached hereto as Exhibit A, with such changes, insertions and additions as they may approve, their execution thereof being conclusive evidence of such approval. SECTION 5. AUTHORIZATION OF NOTE TO FINANCE THE COST OF THE PROJECT. Subject and pursuant to the provisions of this Resolution and the Loan Agreement, -2- an obligation of the City to be known as the "City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017" (the "Note") is hereby authorized to be issued in the principal amount of not to exceed $2,000,000 for the purpose of providing the City with sufficient funds to finance the cost of the Project. The Mayor, the City Clerk the City Manager and the Assistant City Manager (collectively, the "Authorized Officers") are hereby authorized to execute, seal and deliver on behalf of the City, the Note and other documents, instruments, agreements and certificates necessary or desirable to effectuate the Loan as provided in the Loan Agreement. The Note shall be in substantially the fonn attached to the Loan Agreement, with such changes, insertions and additions as the Mayor and City Clerk may approve, their execution thereof being conclusive evidence of such approval. The Note shall be issued in the aggregate principal amount not to exceed $2,000,000, shall bear interest at the fixed interest rate of 2.47%, subject to adjustment as described therein, shall have a final maturity date of June 1, 2032 and shall have such other terns, all as set forth in the Loan Agreement and the Note authorized herein and executed and delivered in connection with the Loan. SECTION 6. SECURITY FOR THE NOTE. The payment of the principal of and interest on the Note shall be secured forthwith equally and ratably by a pledge of and an irrevocable prior lien on the Pledged Revenues. The City does hereby irrevocably pledge the Pledged Revenues to the payment of the principal and interest on the Note issued pursuant to this Resolution and the Loan Agreement, at the times provided and in the sums required to secure the payment of the principal and interest on the Note. The Pledged Revenues shall immediately be subject to the lien of this pledge without any physical delivery thereof or further act. SECTION 7. DESIGNATION OF THE NOTE AS A QUALIFIED TAX-EXEMPT OBLIGATION. The City hereby designates the Note as a "qualified tax-exempt obligation" under Section 265(b)(3) of the Code. This designation is based upon the findings of the City set forth in Section 2(G) of this Resolution. Any one or more Authorized Officers are hereby authorized to certify such finding in connection with the issuance of the Note. The City acknowledges that any action which adversely impacts the status of the Note as a "qualified tax-exempt obligation" will result in an upward adjustment to the interest rate on such Note. SECTION 8. GENERAL AUTHORIZATION. Each Authorized Officer and other employees or agents of the City are authorized to execute and deliver such documents, instruments and contracts, and are hereby authorized and directed to do all acts and things required hereby as may be necessary for the full, punctual and complete performance of all the terns, covenants, provisions and agreements herein contained or in the Loan Agreement, or as otherwise may be necessary or desirable to effectuate the purpose and intent of this Resolution. SECTION 9. REPEAL OF INCONSISTENT DOCUMENTS. All ordinances, resolutions or parts thereof in conflict herewith are hereby superseded and repealed to the extent of such conflict. SECTION 10. VALIDITY OF REMAINING PORTIONS. If any section, subsection, sentence, clause, phrase, or portion of this Resolution, or application hereof, is for any reason held invalid or unconstitutional by any Court, such portion or application shall be deemed a -3- separate, distinct, and independent provision, and such holding shall not affect the validity of the remaining portions or applications hereof. SECTION 11. EFFECTIVE DATE. This Resolution shall take effect immediately upon its adoption. After Motion to approve by l.- 41-1.., ,��`` (P X-h� F- k, „ ..E _ ; and second by ������ , the vote on this resolution was as follows: AYE NAY Mayor Michael Ignasiak Councilwoman Christine Power aV Councilwoman Amy Vogt Councilman Dan Blazi -"' Councilman Gary Conroy -4- PASSED, APPROVED AND ADOPTED this day of June, 2017, ATTEST Rollin L. Matusick, City Clerk/Paralegal For the use and reliance only by the City of Edgewater, Florida. Approved as to form and legality by Aaron R. Wolfe, Esq ire City Attorney Doran Sims Wolfe & Ciocchetti CITY COUNCIL OF THE CITY OF EDGE AT R, FL DA Michael Ignasiak Mayor Approved by the City Council of the City of Edgewater at a meeting held on this ifs day of.. 2017 under Agenda Item No. :�. -5- Exhibit A Loan Agreement A-1 LOAN AGREEMENT Dated as of June 19, 2017 By and Between CITY OF EDGEWATER, FLORIDA (the "City") AND BRANCH BANKING AND TRUST COMPANY (the "Bank") Relating to: $2,000,000 CITY OF EDGEWATER, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 TABLE OF CONTENTS Page ARTICLE I DEFINITION OF TERMS......................................................................................1 Section 1.01 Definitions.......................................................................................1 Section 1.02 Interpretation.................................................................................3 Section 1.03 Titles and Headings........................................................................3 ARTICLE 11 REPRESENTATIONS AND WARRANTIES OF THE PARTIES ..................3 Section 2.01 Representations and Warranties of City.....................................3 ARTICLE III THE NOTE ............................................................................................................4 Section3.01 The Note..........................................................................................4 Section 3.02 Compliance with Section 215.84 ...................................................4 Section 3.03 Conditions Precedent to Purchase of Note..................................4 Section 3.04 Registration of Transfer; Assignment of Rights of Bank ........... 6 Section 3.05 Ownership of the Note...................................................................7 Section 3.06 Use of Proceeds of Note Permitted Under Applicable Law .......7 Section 3.07 Prepayment Option........................................................................7 ARTICLE IV COVENANTS OF THE CITY.............................................................................8 Section 4.01 Performance of Covenants............................................................8 Section 4.02 Payment of the Note.......................................................................8 Section 4.03 Pledged Revenues...........................................................................8 Section 4.04 Tax Covenant.................................................................................8 Section 4.05 Financial Covenant........................................................................9 Section 4.06 Budget and Other Financial Information....................................9 ARTICLE V EVENTS OF DEFAULT AND REMEDIES........................................................9 Section 5.01 Events of Default............................................................................9 1 Section 5.02 Exercise of Remedies...................................................................10 Section 5.03 Remedies Not Exclusive...............................................................11 Section 5.04 Waivers, Etc..................................................................................11 Section 5.05 Waiver of Jury Trial....................................................................11 ARTICLE VI MISCELLANEOUS PROVISIONS..................................................................11 Section 6.01 Covenants of City, Etc.; Successors............................................11 Section 6.02 Term of Agreement......................................................................11 Section 6.03 Notice of Changes in Fact............................................................11 Section 6.04 Amendments and Supplements..................................................12 Section6.05 Notices...........................................................................................12 Section 6.06 Benefits Exclusive.........................................................................12 Section6.07 Severability...................................................................................12 Section 6.08 Payments Due on Saturdays, Sundays and Holidays ...............12 Section 6.09 Counterparts................................................................................13 Section 6.10 Applicable Law.............................................................................13 Section 6.11 No Personal Liability...................................................................13 Section 6.12 Incorporation by Reference........................................................13 EXHIBIT A FORM OF NOTE............................................................................................... A-1 2 LOAN AGREEMENT This LOAN AGREEMENT (this "Agreement"), made and entered into this 19th day of June, 2017, by and between the CITY OF EDGEWATER, FLORIDA (the "City"), a municipal corporation created and existing pursuant to the Constitution and the laws of the State of Florida, and BRANCH BANKING AND TRUST COMPANY, a North Carolina state banking corporation (the "Bank"). WITNESSETH: WHEREAS, capitalized terms used in these recitals and not otherwise defined shall have the meanings specified in Article I of this Agreement; and WHEREAS, the City, pursuant to Article VIII, Section 2 of the Constitution of the State of Florida, Chapter 166, Florida Statutes, as amended and supplemented, the Charter of the City, and any other applicable provisions of law (all of the foregoing, collectively, the "Act"), and Resolution No. 2017-R-21, adopted by the City on June 15, 2017, subject to certain limitations, is authorized to borrow money, issue bonds, notes or other obligations to finance and/or refinance the Project; and WHEREAS, the City has requested proposals for the financing of the Project and has determined that the proposal from the Bank contains the terms most favorable -to the City; WHEREAS, the Bank has agreed to purchase the City's Capital Improvement Revenue Note, Series 2017, in the principal amount of $2,000,000 upon the terms and conditions of this Agreement; NOW, THEREFORE, the parties hereto agree as follows: ARTICLE I. DEFINITION OF TERMS Section 1.01 Definitions. Capitalized terms used in this Agreement and not otherwise defined shall have the respective meanings as follows: "Act" shall have the meaning assigned to that term in the recitals hereof. "Agreement" shall mean this Loan Agreement and all modifications, alterations, amendments and supplements hereto made in accordance with the provisions hereof. "Bank" shall mean Branch Banking and Trust Company, a North Carolina state banking corporation, and/or its successors or assigns. "Business Day" shall mean any day other than a Saturday, a Sunday, or a day on which the payment office of Bank is lawfully closed. "City" shall mean the City of Edgewater, Florida. "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and the applicable rules and regulations promulgated thereunder. "Determination of Taxability" shall mean (i) the issuance by the Internal Revenue Service of a statutory notice of deficiency or other written notification which holds in effect that the interest payable on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code, which notice or notification is not contested by either the City or the Noteholder, or (ii) a determination by a court of competent jurisdiction that the interest payable on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code, which detennination either is final and non-appealable or is not appealed within the requisite time period for appeal, or (iii) the admission in writing by the City to the effect that interest on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code. "Event of Default" shall mean an Event of Default as defined in Section 5.01 of this Agreement. "Final Maturity Date" shall mean the date on which all principal and all unpaid interest accrued on the Note shall be due and payable in full, which date shall be, if not earlier due to prepayment, June 1, 2032. "Fiscal Year" shall mean the twelve-month period commencing October 1 of each year and ending on the succeeding September 30, or such other twelve-month period as the City may designate as its "fiscal year" as permitted by law. "Note" shall mean the City's $2,000,000 Capital Improvement Revenue Note, Series 2017, issued pursuant to the Resolution and this Agreement. "Note Counsel" shall mean, initially, Broad and Cassel LLP, Orlando, Florida or any other attorney at law or firm of attorneys of nationally recognized standing in matters pertaining to the federal tax exemption of interest on obligations issued by states and political subdivisions as approved by the City. "Note Rate" shall mean a fixed rate of 2.47% per annum, subject to adjustment as described herein and in the Note, calculated on the basis of a 360-day year, consisting of twelve (12) thirty (3 0) day months. "Noteholder" shall mean the Bank as the holder of the Note and any subsequent registered holder of the Note. "Pledged Revenues" shall mean the proceeds of the "local government half-cent sales tax" as defined and described in, and distributed to the City under Chapter 218, Part VI, Florida Statutes, as amended and supplemented from time to time. 2 "Project" shall mean the acquisition of approximately 27 acres of real property which will be financed with the proceeds of the Note, for the purpose of constructing a public water front park, including a boat ramp, playground, fishing piers and related amenities, and paying related costs of issuance in connection with the issuance of the Note. "Resolution" shall mean, collectively, Resolution No. 2017-R-21 adopted by the City on June 15, 2017. "Taxable Rate" means the interest rate payable after any Determination of Taxability, subject to a full gross -up modification, as reasonably detennined by the Bank and its counsel, to provide the Bank the same after-tax yield, effective retroactively to the date on which the Detennination of Taxability was deemed to have occurred which rate, together with the calculation of such rate, shall be provided in writing to the City. Section 1.02 Interpretation. Unless the context clearly requires otherwise, words of masculine gender shall be construed to include correlative words of the feminine and neutral genders and vice versa, and words of the singular number shall be construed to include correlative words of the plural number and vice versa. Any capitalized terms used in this Agreement not herein defined shall have the meaning ascribed to such terms in the Resolution. This Agreement and all the terms and provisions hereof shall be construed to effectuate the purpose set forth herein and to sustain the validity hereof. Section 1.03 Titles and Headings. The titles and headings of the Articles and Sections of this Agreement, which have been inserted for convenience of reference only and are not to be considered a part hereof, shall not in any way modify or restrict any of the terns and provisions hereof, and shall not be considered or given any effect in construing this Agreement or any provision hereof or in ascertaining intent, if any question of intent should arise. ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE PARTIES Section 2.01 Representations and Warranties of City. The City represents and warrants to the Bank as follows: (a) Existence. The City is a municipal corporation of the State of Florida, duly created and validly existing under the laws of the State of Florida, with full legal right, power and authority to adopt the Resolution, to enter into this Agreement, to perform its obligations hereunder and to issue and deliver the Note to the Bank. The adoption of the Resolution, the making, execution and perfonnance of this Agreement on the part of the City and the issuance and delivery of the Note have been duly authorized by all necessary action on the part of the City and will not violate or conflict with the Act, or any agreement, indenture or other instrument by which the City or any of its material properties is bound. (b) Validity, Etc. This Agreement, the Note and the Resolution are valid and binding obligations of the City enforceable against the City in accordance with their respective terms, except to the extent that enforceability may be subject to valid bankruptcy, insolvency, financial emergency, reorganization, moratorium or similar laws relating to or from time to time affecting 3 the enforcement of creditors' rights and except to the extent that the availability of certain remedies may be precluded by general principles of equity. (c) No Financial Material Adverse Change. There has been no material adverse change in the financial condition of the City since the date of its last published audited financial statements. Except as may be noted in the financial statements, letters to the City's auditors, or as disclosed separately by the City to the Bank, there are no actions, proceedings or investigations pending against the City or affecting the City (or any basis therefor known to the City) which, either in any case or in the aggregate, are likely to result in any material adverse change in the financial condition, business, prospects, affairs or operations of the City, or in any material impainnent of the right or ability of the City to carry on its operations as now conducted or proposed to be conducted, or in any material liability on the part of the City and none which questions the validity of this Agreement, the Note or the Resolution or of any action taken or to be taken in connection with the transactions contemplated hereby or thereby. (d) Powers of City. The City has the legal power and authority to pledge the Pledged Revenues for the repayment of the Note as described herein. (e) Advice. The City has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, teens and similar matters) with respect to the proposed issuance of the Note from its financial, legal and other advisors (and not the Bank or any of its affiliates) to the extent that the City desired to obtain such advice. The City acknowledges that neither the Bank nor any of its affiliates shall act as a fiduciary for the City or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor with respect to the proposed issuance of the Note and neither the Bank nor any of its affiliates has provided, and will not provide, financial, legal, tax, accounting or other advice to or on behalf of the City with respect to the proposed issuance of the Note. ARTICLE III. THE NOTE Section 3.01 The Note. The Note shall be in substantially the form set forth as Exhibit "A" to this Agreement. Section 3.02 Compliance with Section 215.84. The City represents, warrants, and covenants that the Note Rate, as currently calculated in accordance with Section 215.84, Florida Statutes, is in compliance with Section 215.84, Florida Statutes. Section 3.03 Conditions Precedent to Purchase of Note. Prior to or simultaneously with the delivery of the Note by the City there shall be filed with the Bank the following, each in fonn and substance reasonably acceptable to the Bank and its counsel: (a) an opinion of the City's counsel to the City and the Bank for the exclusive reliance by the addressees, to the effect that (i) the Resolution has been duly adopted and this Agreement has been duly authorized, executed and delivered by the City and each constitutes a valid, binding and enforceable agreement of the City in accordance with its terns, except to the extent that the enforceability of the rights and remedies set forth therein and herein may be limited by bankruptcy, insolvency, financial emergency or other laws affecting creditors' rights generally or 11 by usual equity principles; (ii) the City's adoption of the Resolution, execution, delivery and perfonnance of this Agreement and execution and issuance of the Note are not subject to any authorization, consent, waiver, approval or review of any other governmental body, public officer or regulatory authority not heretofore obtained or effected; (iii) the execution, issuance and delivery of the Note have been duly and validly authorized by the City, and the Note constitutes a valid and binding limited obligation of the City enforceable in accordance with its terms; (iv) the City (A) is a municipal corporation duly organized and validly existing under the laws of the State of Florida, and (B) has power and authority to execute and deliver this Agreement to consummate the transactions contemplated hereby; (v) to the best of such Counsel's knowledge, the adoption of the Resolution, execution, delivery and performance of the Note and this Agreement, and compliance with the terns thereof and hereof, under the circumstances contemplated hereby, do not and will not in any material respect conflict with, or constitute on the part of the City a breach or default under, any indenture, mortgage, deed of trust, agreement or other instrument to which the City or to which its properties are subject or conflict with, violate or result in a breach of any existing law, administrative rule or regulation, judgment, court order or consent decree to which the City or its properties are subject; (vi) to the best of such counsel's knowledge, there is no claim, action, suit, proceeding, inquiry, investigation, litigation or other proceeding, at law or in equity, pending or threatened in any court or other tribunal, state or federal (A) restraining or enjoining, or seeking to restrain or enjoin, the issuance, sale, execution or delivery of the Note, (B) in any way questioning or affecting the validity or enforceability of any provision of this Agreement, the Note, or the Resolution, (C) in any way questioning or affecting the validity of any of the proceedings or authority for the authorization, sale, execution or delivery of the Note, or of any provision made or authorized for the payment thereof, or (D) questioning or affecting the organization or existence of the City or the right of any of its officers to their respective offices; (vii) the City has the legal power to pledge the Pledged Revenues to the repayment of the Note as described herein and in the Resolution; (viii) the issuance of the Note and the transactions arising from this Agreement are not subject to the payment of documentary taxes, and (ix) all conditions contained in the ordinances and resolutions of the City precedent to the issuance of the Note have been complied with. City counsel will not render an opinion concerning the Determination of Taxability of the Note; the federal and State of Florida tax-exempt status of the interest income on the Note and this transaction; and any matters assigned to Note Counsel pursuant to this Agreement. The opinion of the City counsel will be based on the facts in existence and laws in effect on the date of the opinion letter and will disclaim any obligation to update the opinion regardless of whether changes in such facts or laws come to the counsel's attention after the delivery hereof. The opinion will be limited to the law of the State of Florida and will not express an opinion with respect to the laws of any other state or jurisdiction and will not render an opinion concerning securities laws of the State of Florida and the federal government. The opinion of the City counsel will assume that the execution, delivery and performance of the loan documents are within the power of the Bank, and will not violate or result in a breach of any tern or provision of any agreement, judgment, non -Florida Statute, decree or administrative order to which the Bank is subject and will assume that the loan documents, in the exact forn as reviewed by the City counsel, will be duly authorized, completed, executed and delivered by the City and the Bank. 5 (b) an opinion of Note Counsel stating, among other things, that such counsel is of the opinion that: (i) assuming compliance by the City with certain covenants relating to requirements contained in the Code (a) interest on the Note is excluded from gross income for purposes of federal income taxation, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations, and (b) the Note constitutes a qualified tax exempt obligation under Section 265(b)(3) of the Code, (ii) the Resolution and this Agreement constitute valid and legally binding obligations of the City enforceable in accordance with the laws of the State of Florida, and the Note is a valid and legally binding limited obligation of the City, and (iii) the Note is exempt from registration under the Securities Act of 1933, as amended, and the Resolution is exempt from qualification under the Trust Indenture Act of 1939 as amended. (c) a copy of a completed and executed Forn 8038-G to be filed with the Internal Revenue Service by the City; and (d) such other documents as the Bank reasonably may request (including, without limitation, appropriate Florida Division of Bond Finance forms). When the documents and items mentioned in clauses (a) through (d), inclusive, of this Section shall have been filed with the Bank, and when the Note shall have been executed as required by this Agreement, and all conditions of the Resolution and this Agreement have been met, the City shall deliver the Note to or upon the order of the Bank, but only against and upon the City's receipt of the purchase price of the Note, by wire transfer. Section 3.04 Registration of Transfer; Assignment of Rights of Bank. The City shall keep at the office of the City Clerk in the City's records the registration of the Note and the registration of transfers of the Note as provided in this Agreement. Subject to the restriction set forth in the fourth paragraph of this Section, the transfer of the Note may be registered only upon the books kept for the registration of the Note and registration of transfer thereof upon surrender thereof to the City together with an assignment duly executed by the Bank or its attorney or legal representative in the form of the assigmnent set forth on the form of the Note attached as Exhibit A to this Agreement; provided, however, that the Note may be transferred only in whole and not in part. In the case of any such registration of transfer, the City shall execute and deliver in exchange for the applicable Note a new Note registered in the name of the transferee. In all cases in which the Note shall be transferred hereunder, the City shall execute and deliver at the earliest practicable time a new Note in accordance with the provisions of this Agreement. The City may make a charge for every such registration of transfer of the Note sufficient to reimburse it for any tax or other governmental charges imposed by governmental bodies other than the City required to be paid with respect to such registration of transfer, but no other charge shall be made for registering the transfer hereinabove granted. The Note shall be issued in fully registered form and shall be payable in any coin or currency of the United States. The registration of transfer of the Note on the registration books of the City shall be deemed to affect a transfer of the rights and obligations of the Bank under this Agreement to the transferee. Thereafter, such transferee shall be deemed to be the Bank under this Agreement and 0 shall be bound by all provisions of this Agreement that are binding upon the Bank. The City and the transferor shall execute and record such instruments and take such other actions as the City and such transferee may reasonably request in order to confirm that such transferee has succeeded to the capacity of Bank under this Agreement and the Note. In the event any Note is mutilated, lost, stolen, or destroyed, the City shall execute a new Note of like date and denomination as that mutilated, lost, stolen or destroyed; provided that, in the case of any mutilated Note, such mutilated Note shall first be surrendered to the City, and in the case of any lost, stolen, or destroyed Note, there first shall be furnished to the City evidence of such loss, theft or destruction together with an indemnity satisfactory to it. The registered owner of the Note is hereby granted power to transfer absolute title thereof by assignment thereof to a bona fide purchaser for value (present or antecedent) without notice of prior defenses or equities or claims of ownership enforceable against such owner's assignor or any person in the chain of title and before the maturity of such Note; provided, however, that the Note may be transferred only in whole and not in part and provided further, that no transfer shall be permitted absent the City's (and the Bank's) receipt of a letter in form and substance similar to the one delivered by the Bank pursuant to Section 218.385, Florida Statutes from such proposed transferee. Every prior registered owner of the Note shall be deemed to have waived and renounced all of such owner's equities or rights therein in favor of every such bona fide purchaser, and every such bona fide purchaser shall acquire absolute title thereto and to all rights represented thereby. Section 3.05 Ownership of the Note. The person in whose naive the Note is registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of such Note shall be made only to the registered owner thereof or such owner's legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon the Note, and interest thereon, to the extent of the sun or sums so paid. Section 3.06 Use of Proceeds of Note Permitted Under Applicable Law. The City represents, warrants and covenants that the proceeds of the Note will be used solely to finance the Project and will be spent in accordance with the terms and provisions contained in the Tax Certificate executed by the City in connection with the delivery of the Note. The City shall establish an account to be designated as the "Series 2017 Project Fund" (the "Project Fund") for the purpose of holding the proceeds of the Note until expended on the Project. Section 3.07 Prepayment Option. The Note may be prepaid in whole, but not in part, any time, without penalty; provided, that the City shall provide the Bank with five Business Days prior notice of the City's election to prepay the Note. Upon prepayment in full or maturity of the Note, notwithstanding anything herein or in the Note to the contrary, the Bank shall not be required to surrender or cancel the Note until it has received payment in full of all amounts due hereunder and under the Note. 7 ARTICLE IV. COVENANTS OF THE CITY Section 4.01 Performance of Covenants. The City covenants that it will perform faithfully at all times its covenants, undertakings and agreements contained in the Resolution, this Agreement and the Note. The City further covenants to keep accurate records with respect to the use of proceeds. Section 4.02 Payment of the Note. (a) The City covenants that it will promptly pay the principal of and interest on the Note at the place, on the dates and in the manner provided herein and in the Note, in accordance with the terms thereof. (b) The Note will be a limited obligation of the City secured solely by the Pledged Revenues is payable from the Pledged Revenues as provided in the Resolution and this Agreement. The Note will not constitute a general debt, liability or obligation of the City or the State of Florida or any political subdivision thereof within the meaning of any constitutional or statutory provision. Neither the faith and credit nor the taxing power of the City or of the State of Florida or any political subdivision thereof is pledged to the payment of the principal of or interest on the Note and the Noteholder shall never have the right to compel any exercise of any ad valorem taxing power of the City or of the State of Florida or any political subdivision thereof, directly or indirectly to enforce such payment. The Note shall not constitute a lien upon any property of the City except upon the Pledged Revenues. Section 4.03 Pledged Revenues. The payment of principal of and interest on the Note shall be secured equally and ratably by a pledge of and an irrevocable prior lien on the Pledged Revenues. Pursuant to the Resolution and this Agreement, the City has irrevocably pledged the Pledged Revenues to the payment of principal of and interest on the Note. The City covenants to do all things necessary on its part to maintain its eligibility to participate in the distribution of funds from the Local Government Half -cent Sales Tax Clearing Trust Fund as described in Chapter 218, Part VI, Florida Statutes, as amended. The City will at all times comply with all of the requirements and conditions of Chapter 218, Part Vl, Florida Statutes, as amended, and take every necessary action to remain qualified to receive distribution of the Pledged Revenues; and the City will not take any action which will jeopardize its eligibility for receipt of such funds which may adversely affect is undertakings as provided in the Resolution and this Agreement. The City will not take any action or enter into any agreement that shall result in reducing the level of Pledged Revenues distributed to the City from that prevailing at the time the City takes such action or enters into such agreement. Section 4.04 Tax Covenant. The City covenants that the City will not snake any use of the proceeds of the Note at any time during the terin of the Note which, if such use had been reasonably expected on the date the Note was issued, would have caused the Note to be an "arbitrage bond" within the meaning of the Code. The City will comply with the requirements of the Code and any valid and applicable rules and regulations promulgated thereunder necessary to ensure the exclusion of interest on the Note from the gross income of the holders thereof for purposes of federal income taxation. Section 4.05 Financial Covenant. The City covenants that it shall not issue additional obligations secured by the Pledged Revenues unless the aggregate amount of the Pledged Revenues received during any twelve (12) consecutive months designated by the City within twenty four (24) months immediately preceding the date of delivery of such additional obligations equals at least 1.35 times the maximum annual debt service on all debt secured or payable from the Pledged Revenues, including debt service on the proposed additional obligations to be issued. Section 4.06 Budget and Other Financial Information. During the term of this Agreement, the City shall: (a) Within two hundred and seventy (270) days following the end of each Fiscal Year of the City, provide the Bank with a copy of the City's audited financial statements for the preceding Fiscal Year. (b) Provide the Bank with a copy of its resolution adopting its annual budget within sixty (60) days of the adoption of the same, a completed budget book upon the completion of the same, and such other financial information regarding the City as the Bank may reasonably request. (c) Pay the reasonable costs and fees of the Bank, including without limitation, attorneys' fees, in connection with the issuance and purchase of the Note by the Bank. (d) Take all reasonable legal action within its control in order to maintain its existence until all amounts due and owing from the City to the Bank under this Agreement and the Note have been paid in full. (e) Maintain all books and records and agrees that any and all records of the City with respect to the Note shall be open to inspection by the Bank or its representatives at reasonable times at the offices of the City, including financial statements, reports, accountant's letters, budgets, officers' certificates and any other information reasonably requested by the Bank. (f) Promptly inform the Bank in writing of any material events, actual or potential contingent liabilities or defaults or pending or threatened litigation of any amount that could reasonably be expected to have a material and adverse effect upon the financial condition of the City or upon the ability of the City to perform its obligations hereunder or under the Note. ARTICLE V. EVENTS OF DEFAULT AND REMEDIES Section 5.01 Events of Default. Each of the following is hereby declared an "Event of Default:" G (a) payment of the principal of and interest on the Note is not made when the same shall become due and payable; or (b) the City shall default in the due and punctual performance of any other of the covenants, conditions, agreements and provisions contained in the Note or in this Agreement and such default shall continue for thirty (30) days after written notice shall have been received by the City from the Bank specifying such default and requiring the same to be remedied; provided, however, that if, in the reasonable judgment of the Bank, the City shall proceed to take such curative action which, if begun and prosecuted with due diligence, cannot be completed within a period of thirty (30) days, then such period shall be increased to such extent as shall be necessary to enable the City to diligently complete such curative action; or (c) the filing of a petition by or against the City relating to bankruptcy, reorganization, arrangement or readjustment of debt of the City or for any other relief relating to the City under the United States Bankruptcy Code, as amended, or any other insolvency act or law now or hereafter existing, or the involuntary appointment of a receiver or trustee for the City, where such event continues for at least 120 days undismissed or undischarged. Section 5.02 Exercise of Remedies. Upon the occurrence and during the continuance of an Event of Default, the Bank may, by a notice in writing to the City, proceed to protect and enforce its rights under the laws of the State of Florida or under this Agreement by such suits, actions or special proceedings in equity or at law, or by proceedings in the office of any board or officer having jurisdiction, either for the specific performance of any covenant or agreement contained herein or in aid or execution of any power herein granted or for the enforcement of any proper legal or equitable remedy, as the Bank shall deem most effective to protect and enforce such rights. Without limiting the generality of the foregoing, the Bank shall have the right to bring a mandamus action to require the City to perform its obligations under Article IV of this Agreement. In the enforcement of any remedy under this Agreement, to the extent permitted by law, the Bank shall be entitled to sue for, enforce payment of and receive any and all amounts then or during any default becoming, and at any time remaining, due from the City for principal, interest or otherwise under any of the provisions of this Agreement or of the Note then unpaid, together with any and all costs and expenses of collection and of all proceedings hereunder and under the Note (including, without limitation, reasonable legal fees in all proceedings, including administrative, appellate and bankruptcy proceedings), without prejudice to any other right or remedy of the Bank, and to recover and enforce any judgment or decree against the City, but solely as provided herein and in the Note, for any portion of such amounts remaining unpaid and interest, costs, and expenses as above provided, and to collect in any manner provided by law, the monies adjudged or decreed to be payable. Notwithstanding anything contained herein to the contrary, upon the occurrence of an Event of Default, the maturity of, or the principal and interest payments due on, the Note shall not be subject to acceleration. In addition, any amounts due under the Note or this Agreement not paid when due shall bear interest at a default rate equal to the interest rate on the Note plus 2% per annum from and after five days after the date due. 10 Section 5.03 Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Bank is intended to be exclusive of any other remedy or remedies herein provided, and each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder. Section 5.04 Waivers, Etc. No delay or omission of the Bank to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or any acquiescence therein; and every power and remedy given by this Agreement to the Bank may be exercised from time to time and as often as may be deemed expedient. The Bank may waive any default which in its opinion shall have been remedied before the entry of final judgment or decree in any suit, action or proceeding instituted by it under the provisions of this Agreement or before the completion of the enforcement of any other remedy under this Agreement, but no such waiver shall be effective unless in writing and no such waiver shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. Section 5.05 Waiver of Jury Trial. THE PARTIES IRREVOCABLY AND VOLUNTARILY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY DISPUTE HEREUNDER. ARTICLE VI. MISCELLANEOUS PROVISIONS Section 6.01 Covenants of City, Etc.; Successors. All of the covenants, stipulations, obligations and agreements contained in this Agreement shall be deemed to be covenants, stipulations, obligations and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations and agreements shall be binding upon the successor or successors thereof from time to time, and upon any officer, board, commission, authority, agency or instrumentality to whom or to which any power or duty affecting such covenants, stipulations, obligations and agreements shall be transferred by or in accordance with law. Section 6.02 Term of Agreement. This Agreement shall be in full force and effect from the date hereof until the Note and all other sums payable to the Bank hereunder have been paid in full and shall survive the tennination of this Agreement in relation to those provisions that deal with retroactive cost increases for the Bank in relation to the tax-exempt status of the Note. Section 6.03 Notice of Changes in Fact. Promptly after the City becomes aware of the same, to the extent such materially and substantially impairs the City's ability to honor its obligations under this Agreement or the Note, the City will notify the Bank of (a) any changes in any material fact or circumstance represented or warranted by the City in this Agreement or in connection with the issuance of the Note, and (b) any default under this Agreement, specifying in each case the nature thereof and what action the City has taken, is taking and/or proposes to take with respect thereto. 11 Section 6.04 Amendments and Supplements. This Agreement may be amended or supplemented from time to time only by a writing duly executed by each of the City and the Bank. Section 6.05 Notices. Any notice, demand, direction, request or other instrument authorized or required by this Agreement to be given to or filed with the City or the Bank, shall be deemed to have been sufficiently given or filed for all purposes of this Agreement if and when sent by certified mail, return receipt requested: As to the City: City of Edgewater, Florida Attention: Finance Director 104 N. Riverside Drive Edgewater, Florida 32132 As to Bank Branch Banking and Trust Company Attention: Governmental Finance 5130 Parkway Plaza Blvd, Building No. 9 Charlotte, North Carolina 28217 Either party may, by notice sent to the other, designate a different or additional address to which notices under this Agreement are to be sent. Section 6.06 Benefits Exclusive. Except as herein otherwise provided, nothing in this Agreement, expressed or implied, is intended or shall be construed to confer upon any person, firm or corporation, other than the City and the Bank, any right, remedy or claim, legal or equitable, under or by reason of this Agreement or any provision hereof, this Agreement and all its provisions being intended to be and being for the sole and exclusive benefit of the City and the Bank. Section 6.07 Severability. In case any one or more of the provisions of this Agreement, any amendment or supplement hereto or of the Note shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this Agreement, any amendment or supplement hereto or the Note, but this Agreement, any amendment or supplement hereto and the Note shall be construed and enforced at the time as if such illegal or invalid provisions had not been contained therein, nor shall such illegality or invalidity or any application thereof affect any legal and valid application thereof from time to time. In case any covenant, stipulation, obligation or agreement contained in the Note or in this Agreement shall for any reason be held to be in violation of law, then such covenant, stipulation, obligation, or agreement shall be deemed to be the covenant, stipulation, obligation or agreement of the City to the full extent from time to time permitted by law. Section 6.08 Payments Due on Saturdays, Sundays and Holidays. In any case where the date of maturity of interest on or principal of the Note or the date fixed for prepayment of the Note shall be a day which is not a Business Day, then payment of such interest or principal shall be made on the next succeeding day which is a Business Day; provided that interest on any such principal amount shall accrue until payment is received by the Bank. 12 Section 6.09 Counterparts, This Agreement may be executed in any number of counterparts, each of which when so executed and delivered, shall be an original; but such counterparts shall together constitute but one and the same Agreement, and, in making proof of this Agreement, it shall not be necessary to produce or account for more than one such counterpart. Section 6.10 Applicable Law. This Agreement and any other documents related thereto shall be governed exclusively by and construed in accordance with the applicable laws of the State of Florida. Section 6.11 No Personal Liability. Notwithstanding anything to the contrary contained herein or in the Note, or in any other instrument or document executed by or on behalf of the City in connection herewith, no stipulation, covenant, agreement or obligation of any present or future member of the City Council, officer, attorney, employee or agent of the City, or officer, employee or agent of a successor to the City, shall be made in any such person's individual capacity, and no such person, in his or her individual capacity, shall be liable personally for any breach or non -observance of or for any failure to perform, fulfill or comply with any such stipulations, covenants, agreements, liability, debt, judgment or obligations, nor shall any recourse be had for the payment of the principal of or interest on any Note or for any claim based thereon or on any such stipulation, covenant, agreement, liability, debt, judgment or obligation, against any such person, in his or her individual capacity, either directly or through the City or any successor to the City, under any rule or law or equity, statute or constitution or by the enforcement of any assessment or penalty or otherwise and all such liability of any such person, in his or her individual capacity, is hereby expressly waived and released. Section 6.12 Incorporation by Reference. All of the terms and obligations of the Resolution and the Exhibits hereto are hereby incorporated herein by reference as if all of the foregoing were fully set forth in this Agreement. All recitals appearing at the beginning of this Agreement are hereby incorporated herein by reference. 13 [Signature Page to the Loan Agreement] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first set forth herein. [SEAL] CITY OF EDGEWATER, FLORIDA Michael Ignasiak, Mayor ATTEST: Robin L. Matusick, City Clerk/Paralegal S-1 [Signature Page to Loan Agreement] BRANCH BANKING AND TRUST COMPANY Name: Andrew G. Smith Title: Senior Vice President S-2 EXHIBIT A FORM OF NOTE CITY OF EDGEWATER, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 Principal Sum Maturity Date Date of Issuance $2,000,000 June 1, 2032 June 19, 2017 KNOW ALL MEN BY THESE PRESENTS that the CITY OF EDGEWATER, FLORIDA (the "City"), for value received, hereby promises to pay to the order of BRANCH BANKING AND TRUST COMPANY, a North Carolina state banking corporation, or its assigns (the "Holder"), the Principal Sum stated above as hereinafter provided pursuant to that certain Loan Agreement by and between the Holder and the City, dated as of June 19, 2017 (the "Agreement"), together with interest thereon as hereinafter provided until the date the principal amount of this Note is paid in full in the manner hereinafter set forth in any coin or currency of the United States of America which, at the time of payment, is legal tender for the payment of public and private debts, which payments shall be made to the Holder hereof by direct debit or otherwise as the City and the Holder may agree. Capitalized terms used in this Note and not otherwise defined shall have the meanings given to them in the Agreement. This Note shall bear interest at a fixed rate equal to 2.47% per annum (the "Note Rate"), which shall be calculated on the basis of a 360 day year, consisting of twelve (12) thirty (30) day months, subject to adjustment as provided herein. Upon the occurrence of any Determination of Taxability, this Note shall bear interest from the date when such Determination of Taxability is deemed to have occurred at the Taxable Rate. The Note Rate shall also be further adjusted as set forth herein and in the Agreement. The Holder shall provide to the City such documentation to evidence any adjustment to the Note Rate and the calculations made in connection with any such adjustment. Interest shall be paid semiannually during the tern of this Note on each June 1, and December 1, commencing December 1, 2017. Principal shall be paid annually on each June 1, commencing June 1, 2018, as set forth in Schedule I attached hereto. On June 1, 2032, the entire unpaid principal and interest described herein shall be due and payable. The amortization schedule for payments of principal of and interest in the Note is set forth in Schedule I attached hereto, and by reference herein, such Schedule I shall be incorporated by reference into the body of this Note. In addition, the City agrees to pay to the Holder subject to such Detennination of Taxability the Additional Amount upon demand. "Additional Amount" means (i) the difference between (a) interest on this Note for the period commencing on the date on which the interest on the Note ceased to be excludable from gross income for federal income tax purposes or the Note ceased to be a "qualified tax exempt obligation", as the case may be, and ending on the earlier of the date this Note ceased to be outstanding or such adjustment is no longer applicable to this A-1 Note (the "Taxable Period") at a rate per annum equal to the Taxable Rate, and (b) the aggregate amount of interest paid on this Note for the Taxable Period under the provisions of this Note without considering the Determination of Taxability, plus (ii) any penalties and interest paid or payable by such Holder to the Internal Revenue Service by reason of such Detennination of Taxability. Upon the occurrence of an Event of Default, the City shall be obligated to pay as part of the indebtedness evidenced by this Note, all costs of collection and enforcement hereof, including such fees as may be incurred on appeal or incurred in any proceeding under bankruptcy laws as they now or hereafter exist, including specifically but without limitation, claims, disputes and proceedings seeking adequate protection or relief from the automatic stay. In addition, any amount due hereunder not paid when due shall bear interest at a default rate equal to the interest rate on this Note plus 2% per annum. from and after five (5) days after the date due. Anything provided in this Note or the Agreement to the contrary notwithstanding, in no event shall this Note bear interest in excess of the maximum rate permitted by a law (the "Maximum Rate"). In the event the interest rate on this Note exceeds the Maximum. Rate, this Note shall continue to bear interest at the Maximum Rate regardless of the reduction of the interest rate to a rate less than the Maximum Rate until such time as interest shall accrue on this Note in an amount (the "Excess Interest") that would have accrued thereon had the interest rate not been limited by the Maximum Rate. Upon the Maturity Date stated above, in consideration for the limitation of the rate of interest otherwise payable on this Note, the City shall pay to the Holder a fee equal to the amount of all unpaid deferred Excess Interest remaining unpaid as of the Maturity Date. The Note may be prepaid in whole, but not in part, at any time, without penalty; provided, that the City shall provide the Bank with five Business Days prior notice of the City's election to prepay the Note. Upon prepayment in full or maturity of the Note, notwithstanding anything herein or in the Agreement to the contrary, the Holder shall not be required to surrender or cancel the Note until it has received payment in full of all amounts due hereunder and under the Agreement. All payments made by the City hereon shall apply first to accrued interest, then to other charges due the Holder, and the balance thereof shall apply to the principal amount then due on this Note. This Note is authorized to be issued in the outstanding principal amount equal to the Principal Sum under the authority of and in full compliance with the Constitution and statutes of the State of Florida, including, particularly, Chapter 166, Florida Statutes, as amended and supplemented, and other applicable provisions of law, the City's Resolution No. 2017-R-21 adopted on June 15, 2017 (the "Resolution"), and is subject to all ten -ns and conditions of the Resolution and the Agreement. The principal of and interest on this Note do not constitute a general obligation or indebtedness of the City, and the Holder shall never have the right to require or compel the levy A-2 of ad valorem taxes on any property of or in the City for the payment of the principal of and interest on or for any other matter under or relating to this Note. The principal of and interest on this Note are not secured by a lien upon any property of or in the City, except the Pledged Revenues, and are secured solely by the Pledged Revenues in the manner provided in the Resolution and the Agreement. Reference is made to the Resolution and the Agreement for the provisions relating to the security for payment of this Note and the duties and obligations of the City hereunder. The City has designated this Note as a "qualified tax-exempt obligation" pursuant to Section 265(b)(3) of the Code. The City hereby waives presentment, demand, protest and notice of dishonor. This Note is governed and controlled by the Resolution and the Agreement and reference is hereby made thereto regarding interest rate adjustments, and other matters. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] A-3 IN WITNESS WHEREOF, the City Council of the City of Edgewater, Florida has caused this Note to be executed in its name by the manual signature of its Mayor and attested by the manual signature of its City Clerk, and its seal to be impressed hereon, and this Note to be dated the Date of Issuance set forth above. [SEAL] ATTEST: Robin L. Matusick, City Clerk/Paralegal CITY OF EDGEWATER, FLORIDA By: Michael Ignasiak, Mayor ASSIGNMENT FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto (please print or typewrite name, address and tax identification number of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints (Name of Attorney) to transfer the within Note on the books kept for registration thereof, with full power of substitution in the premises. Name of Noteholder: By: SCHEDULEI BOND DEBT SERVICE City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 BB&T Bank Rate of 2.47% 15 Year Amortization Final Numbers Period Ending Principal Coupon Interest Debt Service Annual Debt Service 12/01/2017 22,230.00 22,230.00 06/01/2018 107,0D0 2.470% 24,700.00 131,700.00 153,930.00 12/01/2018 23,378.55 23,378.55 06/01/2019 115,000 2.47091. 23,378.55 138,378.55 161,757.10 12/01/2019 21,958.30 21,958.30 06/01/2020 118,ODO 2.470% 21,958.30 139,958.30 161,916.60 12/01/2020 20,501.00 20,501.00 06/01/2021 121,0DO 2.470% 20,501.00 141,501.00 162,002.00 12/01/2021 19,OD6.65 19,006.65 06/01/2022 123,000 2.4705v. 19,OD6.65 142,006.65 161,013.30 12/01/2022 17,487.60 17,487.60 06/01/2023 127,000 2.470% 17,487.60 144,487.60 161,97510 12/01/2023 15,919.15 15,919.15 06/01/2024 130,000 2.4701/6 15,919.15 145,919.15 161,838.30 12/01/2024 14,313.65 14,313.65 06/01/2025 133,ODO 2.470% 14,313.65 147,313.65 161,627.30 12/01/2025 12,671.10 12,671.10 06/01/Z026 136,ODO 2.470% 12,671.10 148,671.10 161,342.20 12/01/2026 10,991_50 10,991.50 06/01/2027 139,000 2.4709'0 10,99150 149,991.50 160,983.00 12/01/ZO27 9,274.85 9,274.85 06101/2028 143,ODO 2.470% 9,274.85 152,274.85 161,549.70 12101/2028 7,508.80 7,508.80 06/01/2029 146,000 2.47094 7,508.80 153,508.80 161,017.60 12/01/2029 5,705.70 5,705.70 06/01/2030 150,000 2.470% 5,705.70 155,705.70 161,411.40 12/01/2030 3,853.20 3,853.20 06/01/2031 154,000 2.470% 3,853.20 157,853.20 161,706.40 12/01/2031 1,951.30 1,951.30 06/01/2032 158,000 2.470% 1,951.30 159,951.30 161,902.60 2,000,000 415,972.70 2,415,972.70 2,415,972.70 A-5 CITY OF EDGEWATER, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 Principal Sum Maturity Date Date of Issuance $2,000,000 June 1, 2032 June 19, 2017 KNOW ALL MEN BY THESE PRESENTS that the CITY OF EDGEWATER, FLORIDA (the "City"), for value received, hereby promises to pay to the order of BRANCH BANKING AND TRUST COMPANY, a North Carolina state banking corporation, or its assigns (the "Holder"), the Principal Sum stated above as hereinafter provided pursuant to that certain Loan Agreement by and between the Holder and the City, dated as of June 19, 2017 (the "Agreement"), together with interest thereon as hereinafter provided until the date the principal amount of this Note is paid in full in the manner hereinafter set forth in any coin or currency of the United States of America which, at the time of payment, is legal tender for the payment of public and private debts, which payments shall be made to the Holder hereof by direct debit or otherwise as the City and the Holder may agree. Capitalized terms used in this Note and not otherwise defined shall have the meanings given to them in the Agreement. This Note shall bear interest at a fixed rate equal to 2.47% per annum (the "Note Rate"), which shall be calculated on the basis of a 360 day year, consisting of twelve (12) thirty (30) day months, subject to adjustment as provided herein. Upon the occurrence of any Determination of Taxability, this Note shall bear interest from the date when such Determination of Taxability is deemed to have occurred at the Taxable Rate. The Note Rate shall also be further adjusted as set forth herein and in the Agreement. The Holder shall provide to the City such documentation to evidence any adjustment to the Note Rate and the calculations made in connection with any such adjustment. Interest shall be paid semiannually during the term of this Note on each June 1, and December 1, commencing December 1, 2017. Principal shall be paid annually on each June 1, commencing June 1, 2018, as set forth in Schedule I attached hereto. On June 1, 2032, the entire unpaid principal and interest described herein shall be due and payable. The amortization schedule for payments of principal of and interest in the Note is set forth in Schedule I attached hereto, and by reference herein, such Schedule I shall be incorporated by reference into the body of this Note. In addition, the City agrees to pay to the Holder subject to such Determination of Taxability the Additional Amount upon demand. "Additional Amount" means (i) the difference between (a) interest on this Note for the period commencing on the date on which the interest on the Note ceased to be excludable from gross income for federal income tax purposes or the Note ceased to be a "qualified tax exempt obligation", as the case may be, and ending on the earlier of the date this Note ceased to be outstanding or such adjustment is no longer applicable to this Note (the "Taxable Period") at a rate per annum equal to the Taxable Rate, and (b) the aggregate amount of interest paid on this Note for the Taxable Period under the provisions of this Note without considering the Determination of Taxability, plus (ii) any penalties and interest paid or payable by such Holder to the Internal Revenue Service by reason of such Determination of Taxability. Upon the occurrence of an Event of Default, the City shall be obligated to pay as part of the indebtedness evidenced by this Note, all costs of collection and enforcement hereof, including such fees as may be incurred on appeal or incurred in any proceeding under bankruptcy laws as they now or hereafter exist, including specifically but without limitation, claims, disputes and proceedings seeking adequate protection or relief from the automatic stay. In addition, any amount due hereunder not paid when due shall bear interest at a default rate equal to the interest rate on this Note plus 2% per annum from and after five (5) days after the date due. Anything provided in this Note or the Agreement to the contrary notwithstanding, in no event shall this Note bear interest in excess of the maximum rate permitted by a law (the "Maximum Rate"). In the event the interest rate on this Note exceeds the Maximum Rate, this Note shall continue to bear interest at the Maximum Rate regardless of the reduction of the interest rate to a rate less than the Maximum Rate until such time as interest shall accrue on this Note in an amount (the "Excess Interest") that would have accrued thereon had the interest rate not been limited by the Maximum Rate. Upon the Maturity Date stated above, in consideration for the limitation of the rate of interest otherwise payable on this Note, the City shall pay to the Holder a fee equal to the amount of all unpaid deferred Excess Interest remaining unpaid as of the Maturity Date. The Note may be prepaid in whole, but not in part, at any time, without penalty;. provided, that the City shall provide the Bank with five Business Days prior notice of the City's election to prepay the Note. Upon prepayment in full or maturity of the Note, notwithstanding anything herein or in the Agreement to the contrary, the Holder shall not be required to surrender or cancel the Note until it has received payment in full of all amounts due hereunder and under the Agreement. All payments made by the City hereon shall apply first to accrued interest, then to other charges due the Holder, and the balance thereof shall apply to the principal amount then due on this Note. This Note is authorized to be issued in the outstanding principal amount equal to the Principal Sum under the authority of and in full compliance with the Constitution and statutes of the State of Florida, including, particularly, Chapter 166, Florida Statutes, as amended and supplemented, and other applicable provisions of law, the City's Resolution No. 2017-R-21 adopted on June 15, 2017 (the "Resolution"), and is subject to all terms and conditions of the Resolution and the Agreement. The principal of and interest on this Note do not constitute a general obligation or indebtedness of the City, and the Holder shall never have the right to require or compel the levy of ad valorem taxes on any property of or in the City for the payment of the principal of and interest on or for any other matter under or relating to this Note. The principal of and interest on this Note are not secured by a lien upon any property of or in the City, except the Pledged Revenues, and are secured solely by the Pledged Revenues in the manner provided in the Resolution and the Agreement. Reference is made to the Resolution and the Agreement for the provisions relating to the security for payment of this Note and the duties and obligations of the City hereunder. The City has designated this Note as a "qualified tax-exempt obligation" pursuant to Section 265(b)(3) of the Code. The City hereby waives presentment, demand, protest and notice of dishonor. This Note is governed and controlled by the Resolution and the Agreement and reference is hereby made thereto regarding interest rate adjustments, and other matters. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] IN WITNESS WHEREOF, the City Council of the City of Edgewater, Florida has caused this Note to be executed in its name by the manual signature of its Mayor and attested by the manual signature of its City Clerk, and its seal to be impressed hereon, and this Note to be dated the Date of Issuance set forth above. CITY OF EDGEWATER, FLORIDA [SEAL] By. Michael Ignasiak, Ma r ATTEST: Robin L. Matusick, City Clerk/Paralegal ASSIGNMENT FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto (please print or typewrite name, address and tax identification number of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints (Name of Attorney) to transfer the within Note on the books kept for registration thereof, with full power of substitution in the premises. Name of Noteholder: IN SCHEDULEI BOND DEBT SERVICE City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 BB&T Bank Rate of 2.470A 15 Year Amortization Final Numbers Period Ending Principal Coupon Interest Debt Service Annual Debt Service 12/01/2017 22,230.00 22,230.00 06/01/2018 107,000 2.470% 24,7DO.00 131,700.00 153,930.00 12/01/2018 23,378.55 23,378.55 06/01/2019 115,000 2.47091 23,378.55 138,378.55 161,757.10 12/01/2019 21,958.30 21,958.30 06/01/2020 118,000 2.470% 21,958.30 139,958.30 161,916.60 12/01/2020 20,501.00 20,501.00 06/01/2021 121,000 2.470% 20,501.00 141,501.OD 162,002.00 12/01/2021 19,006.65 19,006.65 06/01/2022 123,000 2.470% 19,006.65 142,006.65 161,013.30 12/01/2022 17,487.60 17,487.60 06/01/2023 127,OD0 2.47091. 17,487.60 144,487.60 161,975.20 12/01/2023 15,919.15 15,919.15 06/01/2024 130,000 2.470% 15,919.15 145,919.15 161,838.30 12/01/2024 14,313.65 14,313.65 06/01/2025 133,000 2.470% 14,313.65 147,313.65 161,627.30 12/01/2025 12,671.10 12,671.10 06/01/2026 136,000 2.47091. 12,671.10 148,671.10 161,342.20 12/01/2026 10,991.50 10,991.50 06/01/2027 139,000 2.47091 10,991.50 149,991.50 160,983.00 12/01/2027 9,274.85 9,274.85 06/01/2028 143,060 2.470% 9,274.85 152,274.85 161,549.70 12/01/2028 7,508.80 7,508.80 06/01/2029 146,000 2.47091. 7,508.80 153,508.80 161,017.60 12/01/2029 5,705.70 5,705.70 06/01/2030 150,000 2.4709e. 5,705.70 155,705.70 161,411.40 12/01/2030 3,853.20 3,853.20 06/01/2031 154,000 2.470% 3,853.20 157,853.20 161,706.40 12/01/2031 1,951.30 1,951.30 06/01/2032 158,000 2.470% 1,951.30 159,951.30 161,902.60 2,000,000 415,972.70 2,415,972.70 2,415,972.70 LOAN AGREEMENT Dated as of June 19, 2017 By and Between CITY OF EDGEWATER, FLORIDA (the "City") AND BRANCH BANKING AND TRUST COMPANY (the "Bank") Relating to: $2,000,000 CITY OF EDGEWATER, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 TABLE OF CONTENTS Page ARTICLEI DEFINITION OF TERMS......................................................................................1 Section1.01 Definitions.......................................................................................1 Section1.02 Interpretation.................................................................................3 Section1.03 Titles and Headings........................................................................3 ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE PARTIES ..................3 Section 2.01 Representations and Warranties of City.....................................3 ARTICLEIII THE NOTE............................................................................................................4 Section3.01 The Note..........................................................................................4 Section 3.02 Compliance with Section 215.84 ...................................................4 Section 3.03 Conditions Precedent to Purchase of Note..................................4 Section 3.04 Registration of Transfer; Assignment of Rights of Bank ........... 6 Section3.05 Ownership of the Note...................................................................7 Section 3.06 Use of Proceeds of Note Permitted Under Applicable Law .......7 Section 3.07 Prepayment Option........................................................................7 ARTICLE IV COVENANTS OF THE CITY.............................................................................8 Section4.01 Performance of Covenants............................................................8 Section 4.02 Payment of the Note.......................................................................8 Section 4.03 Pledged Revenues...........................................................................8 Section4.04 Tax Covenant.................................................................................8 Section 4.05 Financial Covenant........................................................................9 Section 4.06 Budget and Other Financial Information....................................9 ARTICLE V EVENTS OF DEFAULT AND REMEDIES........................................................9 Section5.01 Events of Default............................................................................9 1 Section 5.02 Exercise of Remedies...................................................................10 Section5.03 Remedies Not Exclusive...............................................................11 Section5.04 Waivers, Etc..................................................................................11 Section5.05 Waiver of Jury Trial....................................................................11 ARTICLE VI MISCELLANEOUS PROVISIONS..................................................................11 Section 6.01 Covenants of City, Etc.; Successors............................................11 Section6.02 Term of Agreement......................................................................11 Section 6.03 Notice of Changes in Fact............................................................11 Section6.04 Amendments and Supplements..................................................12 Section6.05 Notices...........................................................................................12 Section 6.06 Benefits Exclusive.........................................................................12 Section 6.07 Severability...................................................................................12 Section 6.08 Payments Due on Saturdays, Sundays and Holidays ...............12 Section6.09 Counterparts................................................................................13 Section 6.10 Applicable Law.............................................................................13 Section 6.11 No Personal Liability...................................................................13 Section6.12 Incorporation by Reference........................................................13 EXHIBIT A FORM OF NOTE............................................................................................... A-1 2 LOAN AGREEMENT This LOAN AGREEMENT (this "Agreement"), made and entered into this 19th day of June, 2017, by and between the CITY OF EDGEWATER, FLORIDA (the "City"), a municipal corporation created and existing pursuant to the Constitution and the laws of the State of Florida, and BRANCH BANKING AND TRUST COMPANY, a North Carolina state banking corporation (the "Bank"). WITNESSETH: WHEREAS, capitalized terms used in these recitals and not otherwise defined shall have the meanings specified in Article I of this Agreement; and WHEREAS, the City, pursuant to Article VIII, Section 2 of the Constitution of the State of Florida, Chapter 166, Florida Statutes, as amended and supplemented, the Charter of the City, and any other applicable provisions of law (all of the foregoing, collectively, the "Act"), and Resolution No. 2017-R-21, adopted by the City on June 15, 2017, subject to certain limitations, is authorized to borrow money, issue bonds, notes or other obligations to finance and/or refinance the Project; and WHEREAS, the City has requested proposals for the financing of the Project and has determined that the proposal from the Bank contains the terms most favorable to the City; WHEREAS, the Bank has agreed to purchase the City's Capital Improvement Revenue Note, Series 2017, in the principal amount of $2,000,000 upon the terms and conditions of this Agreement; NOW, THEREFORE, the parties hereto agree as follows: ARTICLE I. DEFINITION OF TERMS Section 1.01 Definitions. Capitalized terms used in this Agreement and not otherwise defined shall have the respective meanings as follows: "Act" shall have the meaning assigned to that term in the recitals hereof. "Agreement" shall mean this Loan Agreement and all modifications, alterations, amendments and supplements hereto made in accordance with the provisions hereof. "Bank" shall mean Branch Banking and Trust Company, a North Carolina state banking corporation, and/or its successors or assigns. "Business Day" shall mean any day other than a Saturday, a Sunday, or a day on which the payment office of Bank is lawfully closed. "City" shall mean the City of Edgewater, Florida. "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and the applicable rules and regulations promulgated thereunder. "Determination of Taxability" shall mean (i) the issuance by the Internal Revenue Service of a statutory notice of deficiency or other written notification which holds in effect that the interest payable on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code, which notice or notification is not contested by either the City or the Noteholder, or (ii) a determination by a court of competent jurisdiction that the interest payable on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code, which determination either is final and non -appealable or is not appealed within the requisite time period for appeal, or (iii) the admission in writing by the City to the effect that interest on the Note is includable for federal income tax purposes in the gross income of the Noteholder or that the Note is not a "qualified tax exempt obligation" under Section 265(b)(3) of the Code. "Event of Default" shall mean an Event of Default as defined in Section 5.01 of this Agreement. "Final Maturity Date" shall mean the date on which all principal and all unpaid interest accrued on the Note shall be due and payable in full, which date shall be, if not earlier due to prepayment, June 1, 2032. "Fiscal Year" shall mean the twelve-month period commencing October 1 of each year and ending on the succeeding September 30, or such other twelve-month period as the City may designate as its "fiscal year" as permitted by law. "Note" shall mean the City's $2,000,000 Capital Improvement Revenue Note, Series 2017, issued pursuant to the Resolution and this Agreement. "Note Counsel" shall mean, initially, Broad and Cassel LLP, Orlando, Florida or any other attorney at law or firm of attorneys of nationally recognized standing in matters pertaining to the federal tax exemption of interest on obligations issued by states and political subdivisions as approved by the City. "Note Rate" shall mean a fixed rate of 2.47% per annum, subject to adjustment as described herein and in the Note, calculated on the basis of a 360 -day year, consisting of twelve (12) thirty (30) day months. "Noteholder" shall mean the Bank as the holder of the Note and any subsequent registered holder of the Note. "Pledged Revenues" shall mean the proceeds of the "local government half -cent sales tax" as defined and described in, and distributed to the City under Chapter 218, Part VI, Florida Statutes, as amended and supplemented from time to time. 2 "Project" shall mean the acquisition of approximately 27 acres of real property which will be financed with the proceeds of the Note, for the purpose of constructing a public water front park, including a boat ramp, playground, fishing piers and related amenities, and paying related costs of issuance in connection with the issuance of the Note. "Resolution" shall mean, collectively, Resolution No. 2017-R-21 adopted by the City on June 15, 2017. "Taxable Rate" means the interest rate payable after any Determination of Taxability, subject to a full gross -up modification, as reasonably determined by the Bank and its counsel, to provide the Bank the same after-tax yield, effective retroactively to the date on which the Determination of Taxability was deemed to have occurred which rate, together with the calculation of such rate, shall be provided in writing to the City. Section 1.02 Interpretation. Unless the context clearly requires otherwise, words of masculine gender shall be construed to include correlative words of the feminine and neutral genders and vice versa, and words of the singular number shall be construed to include correlative words of the plural number and vice versa. Any capitalized terms used in this Agreement not herein defined shall have the meaning ascribed to such terms in the Resolution. This Agreement and all the terms and provisions hereof shall be construed to effectuate the purpose set forth herein and to sustain the validity hereof. Section 1.03 Titles and Headings. The titles and headings of the Articles and Sections of this Agreement, which have been inserted for convenience of reference only and are not to be considered a part hereof, shall not in any way modify or restrict any of the terms and provisions hereof, and shall not be considered or given any effect in construing this Agreement or any provision hereof or in ascertaining intent, if any question of intent should arise. ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE PARTIES Section 2.01 Representations and Warranties of City. The City represents and warrants to the Bank as follows: (a) Existence. The City is a municipal corporation of the State of Florida, duly created and validly existing under the laws of the State of Florida, with full legal right, power and authority to adopt the Resolution, to enter into this Agreement, to perform its obligations hereunder and to issue and deliver the Note to the Bank. The adoption of the Resolution, the making, execution and performance of this Agreement on the part of the City and the issuance and delivery of the Note have been duly authorized by all necessary action on the part of the City and will not violate or conflict with the Act, or any agreement, indenture or other instrument by which the City or any of its material properties is bound. (b) Validity. This Agreement, the Note and the Resolution are valid and binding obligations of the City enforceable against the City in accordance with their respective terms, except to the extent that enforceability may be subject to valid bankruptcy, insolvency, financial emergency, reorganization, moratorium or similar laws relating to or from time to time affecting 3 the enforcement of creditors' rights and except to the extent that the availability of certain remedies may be precluded by general principles of equity. (c) No Financial Material Adverse Change. There has been no material adverse change in the financial condition of the City since the date of its last published audited financial statements. Except as may be noted in the financial statements, letters to the City's auditors, or as disclosed separately by the City to the Bank, there are no actions, proceedings or investigations pending against the City or affecting the City (or any basis therefor known to the City) which, either in any case or in the aggregate, are likely to result in any material adverse change in the financial condition, business, prospects, affairs or operations of the City, or in any material impairment of the right or ability of the City to carry on its operations as now conducted or proposed to be conducted, or in any material liability on the part of the City and none which questions the validity of this Agreement, the Note or the Resolution or of any action taken or to be taken in connection with the transactions contemplated hereby or thereby. (d) Powers of City. The City has the legal power and authority to pledge the Pledged Revenues for the repayment of the Note as described herein. (e) Advice. The City has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms and similar matters) with respect to the proposed issuance of the Note from its financial, legal and other advisors (and not the Bank or any of its affiliates) to the extent that the City desired to obtain such advice. The City acknowledges that neither the Bank nor any of its affiliates shall act as a fiduciary for the City or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor with respect to the proposed issuance of the Note and neither the Bank nor any of its affiliates has provided, and will not provide, financial, legal, tax, accounting or other advice to or on behalf of the City with respect to the proposed issuance of the Note. ARTICLE III. THE NOTE Section 3.01 The Note. The Note shall be in substantially the form set forth as Exhibit "A" to this Agreement. Section 3.02 Compliance with Section 215.84. The City represents, warrants, and covenants that the Note Rate, as currently calculated in accordance with Section 215.84, Florida Statutes, is in compliance with Section 215.84, Florida Statutes. Section 3.03 Conditions Precedent to Purchase of Note. Prior to or simultaneously with the delivery of the Note by the City there shall be filed with the Bank the following, each in form and substance reasonably acceptable to the Bank and its counsel: (a) an opinion of the City's counsel to the City and the Bank for the exclusive reliance by the addressees, to the effect that (i) the Resolution has been duly adopted and this Agreement has been duly authorized, executed and delivered by the City and each constitutes a valid, binding and enforceable agreement of the City in accordance with its terms, except to the extent that the enforceability of the rights and remedies set forth therein and herein may be limited by bankruptcy, insolvency, financial emergency or other laws affecting creditors' rights generally or 11 by usual equity principles; (ii) the City's adoption of the Resolution, execution, delivery and performance of this Agreement and execution and issuance of the Note are not subject to any authorization, consent, waiver, approval or review of any other governmental body, public officer or regulatory authority not heretofore obtained or effected; (iii) the execution, issuance and delivery of the Note have been duly and validly authorized by the City, and the Note constitutes a valid and binding limited obligation of the City enforceable in accordance with its terms; (iv) the City (A) is a municipal corporation duly organized and validly existing under the laws of the State of Florida, and (B) has power and authority to execute and deliver this Agreement to consummate the transactions contemplated hereby; (v) to the best of such Counsel's knowledge, the adoption of the Resolution, execution, delivery and performance of the Note and this Agreement, and compliance with the terms thereof and hereof, under the circumstances contemplated hereby, do not and will not in any material respect conflict with, or constitute on the part of the City a breach or default under, any indenture, mortgage, deed of trust, agreement or other instrument to which the City or to which its properties are subject or conflict with, violate or result in a breach of any existing law, administrative rule or regulation, judgment, court order or consent decree to which the City or its properties are subject; (vi) to the best of such counsel's knowledge, there is no claim, action, suit, proceeding, inquiry, investigation, litigation or other proceeding, at law or in equity, pending or threatened in any court or other tribunal, state or federal (A) restraining or enjoining, or seeking to restrain or enjoin, the issuance, sale, execution or delivery of the Note, (B) in any way questioning or affecting the validity or enforceability of any provision of this Agreement, the Note, or the Resolution, (C) in any way questioning or affecting the validity of any of the proceedings or authority for the authorization, sale, execution or delivery of the Note, or of any provision made or authorized for the payment thereof, or (D) questioning or affecting the organization or existence of the City or the right of any of its officers to their respective offices; (vii) the City has the legal power to pledge the Pledged Revenues to the repayment of the Note as described herein and in the Resolution; (viii) the issuance of the Note and the transactions arising from this Agreement are not subject to the payment of documentary taxes, and (ix) all conditions contained in the ordinances and resolutions of the City precedent to the issuance of the Note have been complied with. City counsel will not render an opinion concerning the Determination of Taxability of the Note; the federal and State of Florida tax-exempt status of the interest income on the Note and this transaction; and any matters assigned to Note Counsel pursuant to this Agreement. The opinion of the City counsel will be based on the facts in existence and laws in effect on the date of the opinion letter and will disclaim any obligation to update the opinion regardless of whether changes in such facts or laws come to the counsel's attention after the delivery hereof. The opinion will be limited to the law of the State of Florida and will not express an opinion with respect to the laws of any other state or jurisdiction and will not render an opinion concerning securities laws of the State of Florida and the federal government. The opinion of the City counsel will assume that the execution, delivery and performance of the loan documents are within the power of the Bank, and will not violate or result in a breach of any term or provision of any agreement, judgment, non -Florida Statute, decree or administrative order to which the Bank is subject and will assume that the loan documents, in the exact form as reviewed by the City counsel, will be duly authorized, completed, executed and delivered by the City and the Bank. W1 (b) an opinion of Note Counsel stating, among other things, that such counsel is of the opinion that: (i) assuming compliance by the City with certain covenants relating to requirements contained in the Code (a) interest on the Note is excluded from gross income for purposes of federal income taxation, and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations, and (b) the Note constitutes a qualified tax exempt obligation under Section 265(b)(3) of the Code, (ii) the Resolution and this Agreement constitute valid and legally binding obligations of the City enforceable in accordance with the laws of the State of Florida, and the Note is a valid and legally binding limited obligation of the City, and (iii) the Note is exempt from registration under the Securities Act of 1933, as amended, and the Resolution is exempt from qualification under the Trust Indenture Act of 1939 as amended. (c) a copy of a completed and executed Form 8038-G to be filed with the Internal Revenue Service by the City; and (d) such other documents as the Bank reasonably may request (including, without limitation, appropriate Florida Division of Bond Finance forms). When the documents and items mentioned in clauses (a) through (d), inclusive, of this Section shall have been filed with the Bank, and when the Note shall have been executed as required by this Agreement, and all conditions of the Resolution and this Agreement have been met, the City shall deliver the Note to or upon the order of the Bank, but only against and upon the City's receipt of the purchase price of the Note, by wire transfer. Section 3.04 Registration of Transfer; Assignment of Rights of Bank. The City shall keep at the office of the City Clerk in the City's records the registration of the Note and the registration of transfers of the Note as provided in this Agreement. Subject to the restriction set forth in the fourth paragraph of this Section, the transfer of the Note may be registered only upon the books kept for the registration of the Note and registration of transfer thereof upon surrender thereof to the City together with an assignment duly executed by the Bank or its attorney or legal representative in the form of the assignment set forth on the form of the Note attached as Exhibit A to this Agreement; provided, however, that the Note may be transferred only in whole and not in part. In the case of any such registration of transfer, the City shall execute and deliver in exchange for the applicable Note a new Note registered in the name of the transferee. In all cases in which the Note shall be transferred hereunder, the City shall execute and deliver at the earliest practicable time a new Note in accordance with the provisions of this Agreement. The City may make a charge for every such registration of transfer of the Note sufficient to reimburse it for any tax or other governmental charges imposed by governmental bodies other than the City required to be paid with respect to such registration of transfer, but no other charge shall be made for registering the transfer hereinabove granted. The Note shall be issued in fully registered form and shall be payable in any coin or currency of the United States. The registration of transfer of the Note on the registration books of the City shall be deemed to affect a transfer of the rights and obligations of the Bank under this Agreement to the transferee. Thereafter, such transferee shall be deemed to be the Bank under this Agreement and rol shall be bound by all provisions of this Agreement that are binding upon the Bank. The City and the transferor shall execute and record such instruments and take such other actions as the City and such transferee may reasonably request in order to confirm that such transferee has succeeded to the capacity of Bank under this Agreement and the Note. In the event any Note is mutilated, lost, stolen, or destroyed, the City shall execute a new Note of like date and denomination as that mutilated, lost, stolen or destroyed; provided that, in the case of any mutilated Note, such mutilated Note shall first be surrendered to the City, and in the case of any lost, stolen, or destroyed Note, there first shall be furnished to the City evidence of such loss, theft or destruction together with an indemnity satisfactory to it. The registered owner of the Note is hereby granted power to transfer absolute title thereof by assignment thereof to a bona fide purchaser for value (present or antecedent) without notice of prior defenses or equities or claims of ownership enforceable against such owner's assignor or any person in the chain of title and before the maturity of such Note; provided, however, that the Note may be transferred only in whole and not in part and provided further, that no transfer shall be permitted absent the City's (and the Bank's) receipt of a letter in form and substance similar to the one delivered by the Bank pursuant to Section 218.385, Florida Statutes from such proposed transferee. Every prior registered owner of the Note shall be deemed to have waived and renounced all of such owner's equities or rights therein in favor of every such bona fide purchaser, and every such bona fide purchaser shall acquire absolute title thereto and to all rights represented thereby. Section 3.05 Ownership of the Note. The person in whose name the Note is registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of such Note shall be made only to the registered owner thereof or such owner's legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon the Note, and interest thereon, to the extent of the sum or sums so paid. Section 3.06 Use of Proceeds of Note Permitted Under Applicable Law. The City represents, warrants and covenants that the proceeds of the Note will be used solely to finance the Project and will be spent in accordance with the terms and provisions contained in the Tax Certificate executed by the City in connection with the delivery of the Note. The City shall establish an account to be designated as the "Series 2017 Project Fund" (the "Project Fund") for the purpose of holding the proceeds of the Note until expended on the Project. Section 3.07 Prepayment Option. The Note may be prepaid in whole, but not in part, any time, without penalty; provided, that the City shall provide the Bank with five Business Days prior notice of the City's election to prepay the Note. Upon prepayment in full or maturity of the Note, notwithstanding anything herein or in the Note to the contrary, the Bank shall not be required to surrender or cancel the Note until it has received payment in full of all amounts due hereunder and under the Note. 7 ARTICLE IV. COVENANTS OF THE CITY Section 4.01 Performance of Covenants. The City covenants that it will perform faithfully at all times its covenants, undertakings and agreements contained in the Resolution, this Agreement and the Note. The City further covenants to keep accurate records with respect to the use of proceeds. Section 4.02 Payment of the Note. (a) The City covenants that it will promptly pay the principal of and interest on the Note at the place, on the dates and in the manner provided herein and in the Note, in accordance with the terms thereof. (b) The Note will be a limited obligation of the City secured solely by the Pledged Revenues is payable from the Pledged Revenues as provided in the Resolution and this Agreement. The Note will not constitute a general debt, liability or obligation of the City or the State of Florida or any political subdivision thereof within the meaning of any constitutional or statutory provision. Neither the faith and credit nor the taxing power of the City or of the State of Florida or any political subdivision thereof is pledged to the payment of the principal of or interest on the Note and the Noteholder shall never have the right to compel any exercise of any ad valorem taxing power of the City or of the State of Florida or any political subdivision thereof, directly or indirectly to enforce such payment. The Note shall not constitute a lien upon any property of the City except upon the Pledged Revenues. Section 4.03 Pledged Revenues. The payment of principal of and interest on the Note shall be secured equally and ratably by a pledge of and an irrevocable prior lien on the Pledged Revenues. Pursuant to the Resolution and this Agreement, the City has irrevocably pledged the Pledged Revenues to the payment of principal of and interest on the Note. The City covenants to do all things necessary on its part to maintain its eligibility to participate in the distribution of funds from the Local Government Half -cent Sales Tax Clearing Trust Fund as described in Chapter 218, Part VI, Florida Statutes, as amended. The City will at all times comply with all of the requirements and conditions of Chapter 218, Part VI, Florida Statutes, as amended, and take every necessary action to remain qualified to receive distribution of the Pledged Revenues; and the City will not take any action which will jeopardize its eligibility for receipt of such funds which may adversely affect is undertakings as provided in the Resolution and this Agreement. The City will not take any action or enter into any agreement that shall result in reducing the level of Pledged Revenues distributed to the City from that prevailing at the time the City takes such action or enters into such agreement. Section 4.04 Tax Covenant. The City covenants that the City will not make any use of the proceeds of the Note at any time during the term of the Note which, if such use had been reasonably expected on the date the Note was issued, would have caused the Note to be an "arbitrage bond" within the meaning of the Code. The City will comply with the requirements of the Code and any valid and applicable rules and regulations promulgated thereunder necessary to ensure the exclusion of interest on the Note from the gross income of the holders thereof for purposes of federal income taxation. Section 4.05 Financial Covenant. The City covenants that it shall not issue additional obligations secured by the Pledged Revenues unless the aggregate amount of the Pledged Revenues received during any twelve (12) consecutive months designated by the City within twenty four (24) months immediately preceding the date of delivery of such additional obligations equals at least 1.35 times the maximum annual debt service on all debt secured or payable from the Pledged Revenues, including debt service on the proposed additional obligations to be issued. Section 4.06 Budget and Other Financial Information. During the term of this Agreement, the City shall: (a) Within two hundred and seventy (270) days following the end of each Fiscal Year of the City, provide the Bank with a copy of the City's audited financial statements for the preceding Fiscal Year. (b) Provide the Bank with a copy of its resolution adopting its annual budget within sixty (60) days of the adoption of the same, a completed budget book upon the completion of the same, and such other financial information regarding the City as the Bank may reasonably request. (c) Pay the reasonable costs and fees of the Bank, including without limitation, attorneys' fees, in connection with the issuance and purchase of the Note by the Bank. (d) Take all reasonable legal action within its control in order to maintain its existence until all amounts due and owing from the City to the Bank under this Agreement and the Note have been paid in full. (e) Maintain all books and records and agrees that any and all records of the City with respect to the Note shall be open to inspection by the Bank or its representatives at reasonable times at the offices of the City, including financial statements, reports, accountant's letters, budgets, officers' certificates and any other information reasonably requested by the Bank. (f) Promptly inform the Bank in writing of any material events, actual or potential contingent liabilities or defaults or pending or threatened litigation of any amount that could reasonably be expected to have a material and adverse effect upon the financial condition of the City or upon the ability of the City to perform its obligations hereunder or under the Note. ARTICLE V. EVENTS OF DEFAULT AND REMEDIES Section 5.01 Events of Default. Each of the following is hereby declared an "Event of Default:" 6 (a) payment of the principal of and interest on the Note is not made when the same shall become due and payable; or (b) the City shall default in the due and punctual performance of any other of the covenants, conditions, agreements and provisions contained in the Note or in this Agreement and such default shall continue for thirty (30) days after written notice shall have been received by the City from the Bank specifying such default and requiring the same to be remedied; provided, however, that if, in the reasonable judgment of the Bank, the City shall proceed to take such curative action which, if begun and prosecuted with due diligence, cannot be completed within a period of thirty (30) days, then such period shall be increased to such extent as shall be necessary to enable the City to diligently complete such curative action; or (c) the filing of a petition by or against the City relating to bankruptcy, reorganization, arrangement or readjustment of debt of the City or for any other relief relating to the City under the United States Bankruptcy Code, as amended, or any other insolvency act or law now or hereafter existing, or the involuntary appointment of a receiver or trustee for the City, where such event continues for at least 120 days undismissed or undischarged. Section 5.02 Exercise of Remedies. Upon the occurrence and during the continuance of an Event of Default, the Bank may, by a notice in writing to the City, proceed to protect and enforce its rights under the laws of the State of Florida or under this Agreement by such suits, actions or special proceedings in equity or at law, or by proceedings in the office of any board or officer having jurisdiction, either for the specific performance of any covenant or agreement contained herein or in aid or execution of any power herein granted or for the enforcement of any proper legal or equitable remedy, as the Bank shall deem most effective to protect and enforce such rights. Without limiting the generality of the foregoing, the Bank shall have the right to bring a mandamus action to require the City to perform its obligations under Article IV of this Agreement. In the enforcement of any remedy under this Agreement, to the extent permitted by law, the Bank shall be entitled to sue for, enforce payment of and receive any and all amounts then or during any default becoming, and at any time remaining, due from the City for principal, interest or otherwise under any of the provisions of this Agreement or of the Note then unpaid, together with any and all costs and expenses of collection and of all proceedings hereunder and under the Note (including, without limitation, reasonable legal fees in all proceedings, including administrative, appellate and bankruptcy proceedings), without prejudice to any other right or remedy of the Bank, and to recover and enforce any judgment or decree against the City, but solely as provided herein and in the Note, for any portion of such amounts remaining unpaid and interest, costs, and expenses as above provided, and to collect in any manner provided by law, the monies adjudged or decreed to be payable. Notwithstanding anything contained herein to the contrary, upon the occurrence of an Event of Default, the maturity of, or the principal and interest payments due on, the Note shall not be subject to acceleration. In addition, any amounts due under the Note or this Agreement not paid when due shall bear interest at a default rate equal to the interest rate on the Note plus 2% per annum from and after five days after the date due. 10 Section 5.03 Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Bank is intended to be exclusive of any other remedy or remedies herein provided, and each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder. Section 5.04 Waivers, Etc. No delay or omission of the Bank to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or any acquiescence therein; and every power and remedy given by this Agreement to the Bank may be exercised from time to time and as often as may be deemed expedient. The Bank may waive any default which in its opinion shall have been remedied before the entry of final judgment or decree in any suit, action or proceeding instituted by it under the provisions of this Agreement or before the completion of the enforcement of any other remedy under this Agreement, but no such waiver shall be effective unless in writing and no such waiver shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. Section 5.05 Waiver of Jury Trial. THE PARTIES IRREVOCABLY AND VOLUNTARILY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY DISPUTE HEREUNDER. ARTICLE VI. MISCELLANEOUS PROVISIONS Section 6.01 Covenants of City, Etc.; Successors. All of the covenants, stipulations, obligations and agreements contained in this Agreement shall be deemed to be covenants, stipulations, obligations and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations and agreements shall be binding upon the successor or successors thereof from time to time, and upon any officer, board, commission, authority, agency or instrumentality to whom or to which any power or duty affecting such covenants, stipulations, obligations and agreements shall be transferred by or in accordance with law. Section 6.02 Term of ALrreement. This Agreement shall be in full force and effect from the date hereof until the Note and all other sums payable to the Bank hereunder have been paid in full and shall survive the termination of this Agreement in relation to those provisions that deal with retroactive cost increases for the Bank in relation to the tax-exempt status of the Note. Section 6.03 Notice of Changes in Fact. Promptly after the City becomes aware of the same, to the extent such materially and substantially impairs the City's ability to honor its obligations under this Agreement or the Note, the City will notify the Bank of (a) any changes in any material fact or circumstance represented or warranted by the City in this Agreement or in connection with the issuance of the Note, and (b) any default under this Agreement, specifying in each case the nature thereof and what action the City has taken, is taking and/or proposes to take with respect thereto. 11 Section 6.04 Amendments and Supplements. This Agreement may be amended or supplemented from time to time only by a writing duly executed by each of the City and the Bank. Section 6.05 Notices. Any notice, demand, direction, request or other instrument authorized or required by this Agreement to be given to or filed with the City or the Bank, shall be deemed to have been sufficiently given or filed for all purposes of this Agreement if and when sent by certified mail, return receipt requested: As to the City: City of Edgewater, Florida Attention: Finance Director 104 N. Riverside Drive Edgewater, Florida 32132 As to Bank: Branch Banking and Trust Company Attention: Governmental Finance 5130 Parkway Plaza Blvd, Building No. 9 Charlotte, North Carolina 28217 Either party may, by notice sent to the other, designate a different or additional address to which notices under this Agreement are to be sent. Section 6.06 Benefits Exclusive. Except as herein otherwise provided, nothing in this Agreement, expressed or implied, is intended or shall be construed to confer upon any person, firm or corporation, other than the City and the Bank, any right, remedy or claim, legal or equitable, under or by reason of this Agreement or any provision hereof, this Agreement and all its provisions being intended to be and being for the sole and exclusive benefit of the City and the Bank. Section 6.07 Severability. In case any one or more of the provisions of this Agreement, any amendment or supplement hereto or of the Note shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this Agreement, any amendment or supplement hereto or the Note, but this Agreement, any amendment or supplement hereto and the Note shall be construed and enforced at the time as if such illegal or invalid provisions had not been contained therein, nor shall such illegality or invalidity or any application thereof affect any legal and valid application thereof from time to time. In case any covenant, stipulation, obligation or agreement contained in the Note or in this Agreement shall for any reason be held to be in violation of law, then such covenant, stipulation, obligation, or agreement shall be deemed to be the covenant, stipulation, obligation or agreement of the City to the full extent from time to time permitted by law. Section 6.08 Payments Due on Saturdays, Sundays and Holidays. In any case where the date of maturity of interest on or principal of the Note or the date fixed for prepayment of the Note shall be a day which is not a Business Day, then payment of such interest or principal shall be made on the next succeeding day which is a Business Day; provided that interest on any such principal amount shall accrue until payment is received by the Bank. 12 Section 6.09 Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered, shall be an original; but such counterparts shall together constitute but one and the same Agreement, and, in making proof of this Agreement, it shall not be necessary to produce or account for more than one such counterpart. Section 6.10 Applicable Law. This Agreement and any other documents related thereto shall be governed exclusively by and construed in accordance with the applicable laws of the State of Florida. Section 6.11 No Personal Liability. Notwithstanding anything to the contrary contained herein or in the Note, or in any other instrument or document executed by or on behalf of the City in connection herewith, no stipulation, covenant, agreement or obligation of any present or future member of the City Council, officer, attorney, employee or agent of the City, or officer, employee or agent of a successor to the City, shall be made in any such person's individual capacity, and no such person, in his or her individual capacity, shall be liable personally for any breach or non -observance of or for any failure to perform, fulfill or comply with any such stipulations, covenants, agreements, liability, debt, judgment or obligations, nor shall any recourse be had for the payment of the principal of or interest on any Note or for any claim based thereon or on any such stipulation, covenant, agreement, liability, debt, judgment or obligation, against any such person, in his or her individual capacity, either directly or through the City or any successor to the City, under any rule or law or equity, statute or constitution or by the enforcement of any assessment or penalty or otherwise and all such liability of any such person, in his or her individual capacity, is hereby expressly waived and released. Section 6.12 Incorporation by Reference. All of the terms and obligations of the Resolution and the Exhibits hereto are hereby incorporated herein by reference as if all of the foregoing were fully set forth in this Agreement. All recitals appearing at the beginning of this Agreement are hereby incorporated herein by reference. 13 [Signature Page to the Loan Agreement] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first set forth herein. [SEAL] CITY OF EDGEWATER, FLORIDA By: A, �1'41-/ - Michael Ignasiak, MaVor ATTEST: By. `r �u Qac tc Robin L. Matusick, City Clerk/Paralegal S-1 [Signature Page to Loan Agreement] BRANCH BANKING A D ' 'R e`OMPANY By: Name: Andrew G. Smith Title: Senior Vice President S-2 EXHIBIT A FORM OF NOTE CITY OF EDGEWATER, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2017 Principal Sum Maturity Date of Issuance $2,000,000 June 1, 2032 June 19, 2017 KNOW ALL MEN BY THESE PRESENTS that the CITY OF EDGEWATER, FLORIDA (the "City"), for value received, hereby promises to pay to the order of BRANCH BANKING AND TRUST COMPANY, a North Carolina state banking corporation, or its assigns (the "Holder"), the Principal Sum stated above as hereinafter provided pursuant to that certain Loan Agreement by and between the Holder and the City, dated as of June 19, 2017 (the "Agreement"), together with interest thereon as hereinafter provided until the date the principal amount of this Note is paid in full in the manner hereinafter set forth in any coin or currency of the United States of America which, at the time of payment, is legal tender for the payment of public and private debts, which payments shall be made to the Holder hereof by direct debit or otherwise as the City and the Holder may agree. Capitalized terms used in this Note and not otherwise defined shall have the meanings given to them in the Agreement. This Note shall bear interest at a fixed rate equal to 2.47% per annum (the "Note Rate"), which shall be calculated on the basis of a 360 day year, consisting of twelve (12) thirty (30) day months, subject to adjustment as provided herein. Upon the occurrence of any Determination of Taxability, this Note shall bear interest from the date when such Determination of Taxability is deemed to have occurred at the Taxable Rate. The Note Rate shall also be further adjusted as set forth herein and in the Agreement. The Holder shall provide to the City such documentation to evidence any adjustment to the Note Rate and the calculations made in connection with any such adjustment. Interest shall be paid semiannually during the term of this Note on each June 1, and December 1, commencing December 1, 2017. Principal shall be paid annually on each June 1, commencing June 1, 2018, as set forth in Schedule I attached hereto. On June 1, 2032, the entire unpaid principal and interest described herein shall be due and payable. The amortization schedule for payments of principal of and interest in the Note is set forth in Schedule I attached hereto, and by reference herein, such Schedule I shall be incorporated by reference into the body of this Note. In addition, the City agrees to pay to the Holder subject to such Determination of Taxability the Additional Amount upon demand. "Additional Amount" means (i) the difference between (a) interest on this Note for the period commencing on the date on which the interest on the Note ceased to be excludable from gross income for federal income tax purposes or the Note ceased to be a "qualified tax exempt obligation", as the case may be, and ending on the earlier of the date this Note ceased to be outstanding or such adjustment is no longer applicable to this A-1 Note (the "Taxable Period") at a rate per annum equal to the Taxable Rate, and (b) the aggregate amount of interest paid on this Note for the Taxable Period under the provisions of this Note without considering the Determination of Taxability, plus (ii) any penalties and interest paid or payable by such Holder to the Internal Revenue Service by reason of such Determination of Taxability. Upon the occurrence of an Event of Default, the City shall be obligated to pay as part of the indebtedness evidenced by this Note, all costs of collection and enforcement hereof, including such fees as may be incurred on appeal or incurred in any proceeding under bankruptcy laws as they now or hereafter exist, including specifically but without limitation, claims, disputes and proceedings seeking adequate protection or relief from the automatic stay. In addition, any amount due hereunder not paid when due shall bear interest at a default rate equal to the interest rate on this Note plus 2% per annum from and after five (5) days after the date due. Anything provided in this Note or the Agreement to the contrary notwithstanding, in no event shall this Note bear interest in excess of the maximum rate permitted by a law (the "Maximum Rate"). In the event the interest rate on this Note exceeds the Maximum Rate, this Note shall continue to bear interest at the Maximum Rate regardless of the reduction of the interest rate to a rate less than the Maximum Rate until such time as interest shall accrue on this Note in an amount (the "Excess Interest") that would have accrued thereon had the interest rate not been limited by the Maximum Rate. Upon the Maturity Date stated above, in consideration for the limitation of the rate of interest otherwise payable on this Note, the City shall pay to the Holder a fee equal to the amount of all unpaid deferred Excess Interest remaining unpaid as of the Maturity Date. The Note may be prepaid in whole, but not in part, at any time, without penalty; provided, that the City shall provide the Bank with five Business Days prior notice of the City's election to prepay the Note. Upon prepayment in full or maturity of the Note, notwithstanding anything herein or in the Agreement to the contrary, the Holder shall not be required to surrender or cancel the Note until it has received payment in full of all amounts due hereunder and under the Agreement. All payments made by the City hereon shall apply first to accrued interest, then to other charges due the Holder, and the balance thereof shall apply to the principal amount then due on this Note. This Note is authorized to be issued in the outstanding principal amount equal to the Principal Sum under the authority of and in full compliance with the Constitution and statutes of the State of Florida, including, particularly, Chapter 166, Florida Statutes, as amended and supplemented, and other applicable provisions of law, the City's Resolution No. 2017-R-21 adopted on June 15, 2017 (the "Resolution"), and is subject to all terms and conditions of the Resolution and the Agreement. The principal of and interest on this Note do not constitute a general obligation or indebtedness of the City, and the Holder shall never have the right to require or compel the levy A-2 of ad valorem taxes on any property of or in the City for the payment of the principal of and interest on or for any other matter under or relating to this Note. The principal of and interest on this Note are not secured by a lien upon any property of or in the City, except the Pledged Revenues, and are secured solely by the Pledged Revenues in the manner provided in the Resolution and the Agreement. Reference is made to the Resolution and the Agreement for the provisions relating to the security for payment of this Note and the duties and obligations of the City hereunder. The City has designated this Note as a "qualified tax-exempt obligation" pursuant to Section 265(b)(3) of the Code. The City hereby waives presentment, demand, protest and notice of dishonor. This Note is governed and controlled by the Resolution and the Agreement and reference is hereby made thereto regarding interest rate adjustments, and other matters. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] ".1W IN WITNESS WHEREOF, the City Council of the City of Edgewater, Florida has caused this Note to be executed in its name by the manual signature of its Mayor and attested by the manual signature of its City Clerk, and its seal to be impressed hereon, and this Note to be dated the Date of Issuance set forth above. [SEAL] ATTEST: Robin L. Matusick, City Clerk/Paralegal CITY OF EDGEWATER, FLORIDA wo Michael Ignasiak, Mayor ASSIGNMENT FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto (please print or typewrite name, address and tax identification number of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints (Name of Attorney) to transfer the within Note on the books kept for registration thereof, with full power of substitution in the premises. Name of Noteholder: SCHEDULEI BOND DEBT SERVICE City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 BB&T Bank Rate of 2.47% 15 Year Amortization Final Numbers Period Ending Principal Coupon Interest Debt Service Annual Debt Service 12/01/2017 22,230.00 22,230.00 06/01/2018 107,000 2.470Ya 24,700.00 131,700.00 153,930.00 12/01/2018 23,378.55 23,378.55 06/01/2029 115,000 2.4709/6 23,378.55 138,378.55 161,757.10 12/01/2019 21,958.30 21,958.30 06/01/2020 118,000 2.470% 21,958.30 139,958.30 161,916.60 12/01/2020 20,501.00 20,501.00 06/01/2021 121,OD0 2.470% 20,501.00 141,501.00 162,002.00 12/01/2021 19,006.65 19,006.65 06/01/2022 123,000 2.470% 19,006.65 142,006.65 161,013.30 12/01/2022 17,487.60 17,487.60 06/01/2023 127,000 2.47094. 17,487.60 144,487.60 161,975.20 12/01/2D23 15,919.15 15,919.15 06/01/2024 130,000 2.470% 15,919.15 145,919.15 161,838.30 12/01/2024 14,313.65 14,313.65 06/01/2025 133,000 2.470% 14,313.65 147,313.65 161,627.30 12/01/2025 12,671.10 12,671.10 06/01/2026 136,000 2.470% 12,671.10 148,671.10 161,342.20 12/01/2026 10,991.50 10,991.50 06/01/2027 139,000 2.470Yo 10,991.50 149,991.50 160,983.00 12/01/2027 9,274.85 9,274.85 06/01/2028 143,000 2.470% 9,274.85 152,274.85 161,549.70 12/01/2028 7,508.80 7,508.80 06/01/2029 146,000 2.470% 7,508.80 153,508.80 161,017.60 12/01/2029 5,705.70 5,705.70 06/01/2030 150,000 2.470Yn 5,705.70 155,705.70 161,411.40 12/01/2030 3,853.20 3,853.20 06/01/2031 154,000 2.470% 3,853.20 157,853.20 161,706.40 12/01/2031 1,951.30 1,951.30 06/01/2032 158,000 2.470% 1,951.30 159,951.30 161,902.60 2,000,000 415,972.70 2,415,972.70 2,415,972.70 A-5 ic BROAD AND CASSEL ATTORNEYS AT LAW June 19, 2017 Members of the City Council of the City of Edgewater, Florida Edgewater, Florida Branch Banking and Trust Company Charlotte, North Carolina 390 NORTH ORANGE AVENUE SUITE 1400 ORLANDO, FLORIDA 32801 P.O. Box 4961 (32802-4961) TELEPHONE: 4 07.83 9.4200 FACSIMILE: 4 0 7.42 5.83 7 7 www.broadandeassel.com JOSEPH STANTON EMAIL: jstanton@broadandcassel.com Re: $2,000,000 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 We have served as Note Counsel in connection with the issuance by the City of Edgewater, Florida (the "Issuer"), of its Capital Improvement Revenue Note, Series 2017, dated June 19, 2017, in the principal amount of $2,000,000 (the "Note"), payable to Branch Banking and Trust Company, a North Carolina state banking corporation (the "Bank"), and evidencing a loan in an equal principal amount made by the Bank to the Issuer on the date hereof pursuant to the terms of that certain Loan Agreement dated as of the date hereof, between the Issuer and the Bank (the "Agreement"). The Note is being issued pursuant to the Constitution and laws of the State of Florida, particularly Chapter 166, Part II, Florida Statutes, and other applicable provisions of law, and Resolution No. 2017-R-21 adopted by the Issuer on June 15, 2017 (the "Resolution"), for the purposes of financing the cost of the Project (as defined in the Resolution). The Note is a limited obligation of the City. The City has irrevocably pledged the proceeds of the "local government half -cent sales tax" as defined and described in, and distributed to the Issuer under, Chapter 218, Part VI, Florida Statutes, as amended and supplemented from time to time (the "Pledged Revenues") to the payment of the principal and interest on the Note pursuant to the Resolution and the Agreement, at the times provided and in the sums required to secure the payment of the principal and interest on the Note. For purposes of this opinion we have examined: (a) executed counterparts of the Resolution, the Note, the Agreement, and the Issuer's Tax Certificate dated the date hereof, (b) the opinion of even date herewith of Doran Sims Wolfe & Ciocchetti (the "Issuer Counsel Opinion"), in its capacity as counsel to the Issuer, and (c) such certified proceedings and other agreements, documents, certificates and papers as we have considered necessary and appropriate to render this opinion. BOCA RATON • DESTIN • FT. LAUDERDALE • MIAMI • ORLANDO • TALLAHASSEE • TAMPA • WEST PALM BEACH 4849-0753-8249.2 43699/0009 City of Edgewater, Florida Branch Banking and Trust Company Page 2 We have also relied upon the Issuer's Counsel Opinion with respect to various matters concerning the Issuer, including but not limited to: (i) the authority of the Issuer to enter into and perform its respective obligations under the Resolution, the Agreement and the Note, and (ii) the due authorization, execution and delivery of the Resolution, the Agreement and the Note by the Issuer. As to questions of fact material to our opinion, we have relied upon representations and covenants made on behalf of the Issuer in the Resolution, the Agreement and the Tax Certificate, certificates of officials of the Issuer (including certifications as to the use of Note proceeds and the operation and use of the property financed thereby), without undertaking to verify the same by independent investigation. We have not passed upon any matters relating to the business, affairs or condition (financial or otherwise) of the Issuer and no inference should be drawn that we have expressed any opinion on matters relating to the ability of the Issuer to perform its obligations under the contracts described herein. Based upon this examination, we are of the opinion that, under existing law: 1. The Resolution and the Agreement each constitutes a valid and binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms. 2. The Note constitutes a valid and binding obligation of the Issuer enforceable in accordance with its terms, payable from and secured by Pledged Revenues. 3. The interest on the Note is excluded from gross income for federal income tax purposes under Section 103(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and is not treated as an item of tax preference under Section 57 of the Code for purposes of the alternative minimum tax imposed on individuals and corporations; however, such interest is taken into account in determining adjusted current earnings for purposes of computing the alternative minimum tax on corporations. 4. The Note constitutes a "qualified tax-exempt obligation" within the meaning of Section 265(b)(3)(B) of the Code. In rendering this opinion, we have relied on the representations and certifications of the Issuer set forth in the Resolution and the closing certificates delivered in connection with the issuance of the Note. 5. The Note is exempt from registration under the Securities Act of 1933, as amended, and the Resolution is exempt from qualification as an indenture under the Trust Indenture Act of 1939, as amended. In giving the foregoing opinions, we have assumed and relied upon compliance with the covenants of the Issuer and the accuracy, which we have not independently verified, of the representations and certifications of the Issuer contained in the Resolution, the Agreement, the BOCA RATON • DESTIN • FT. LAUDERDALE • MIAMI • ORLANDO • TALLAHASSEE • TAMPA • WEST PALM BEACH City of Edgewater, Florida Branch Banking and Trust Company Page 3 Note and the financing documents. The accuracy of those representations and certifications, and compliance by the Issuer with those covenants, may be necessary for the interest on the Note to be and to remain excluded from gross income for federal income tax purposes and for certain of the other tax effects stated above. Failure to comply with certain of those covenants subsequent to issuance of the Note could cause interest thereon to be included in gross income for federal income tax purposes retroactively to the date of the issuance of the Note. This opinion should not be construed as offering material, an offering circular, prospectus or official statement relating to the Note and is not intended in any way to be a disclosure statement used in connection with the sale or delivery of the Note. Our opinions expressed herein are predicated upon present laws and interpretations thereof. We assume no affirmative obligation with respect to any change of circumstances or law occurring after the date hereof that may adversely affect the exclusion from gross income for federal income tax purposes of interest on the Note. It is to be understood that the rights of the owners of the Note and the enforceability of the Note, the Resolution, the Agreement and the Tax Certificate may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted to the extent constitutionally applicable and that their enforcement may also be subject to the exercise of judicial discretion in appropriate cases. Respectfully submitted, BROAD AND CASSEL LLP By: Joseph B. Stanton, P.A. BOCA RATON - DESTIN • FT. LAUDERDALE • MIAMI • ORLANDO • TALLAHASSEE • TAMPA • WEST PALM BEACH June 19, 2017 Members of the City of Edgewater, Florida City Council Edgewater, Florida Branch Banking and Trust Company Charlotte, North Carolina Broad and Cassel LLP Orlando, Florida Re: $2,000,000 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 (the "Note") Ladies and Gentlemen: I have acted as counsel to the City of Edgewater, Florida (the "Issuer") in connection with the authorization and delivery of the above -captioned Note, pursuant to Resolution No. 2017-R-21, duly adopted by the Issuer on June 15, 2017 (the "Resolution"), for the purpose. of financing the Project as described in the Resolution. Capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Resolution or that certain Loan Agreement, dated as of June 19, 2017, (the "Loan Agreement"), by and between the Issuer and Branch Banking and Trust Company, a North Carolina state banking corporation (the "Bank"). I am of the opinion that: 1. The Issuer is a municipal corporation, duly organized and validly existing under the laws of the State of Florida (the "State") and has all requisite power and authority to adopt the Resolution, execute and deliver the Loan Agreement, issue the Note and consummate the transactions contemplated thereby. 2. The Resolution has been duly adopted, and the Loan Agreement and the Note have been duly authorized, executed and delivered by the Issuer; and the Resolution, the Loan Agreement and the. Note are in Rill force and effect and constitute valid and binding obligations of the Issuer, enforceable in accordance with their respective terms, except to the extent that the enforceability of the rights and remedies set forth therein may be limited by bankruptcy laws, insolvency, financial emergency or other laws affecting creditors' rights generally or by usual equity principles. City of Edgewater, Florida Branch Banking and Trust Company Broad and Cassel LLP Page 2 of 3 3. To the best of my knowledge, there are no claims, actions, suits, proceedings, inquiries, investigations or litigation or other proceedings, at law or in equity, pending or threatened against or affecting the Issuer in any court or other tribunal, state or federal: (a) restraining or enjoining, or seeking to restrain or enjoin, the issuance, sale, execution or delivery of the Note; (b) in any way questioning or affecting the validity or enforceability of any provision of the Loan Agreement, the Note, or the Resolution; (c) in any way questioning or affecting the validity of any of the proceedings or authority for the authorization, sale, execution or delivery of the Note, or of any provision made or authorized for the payment thereof, or (d) questioning or affecting the organization. or existence of the Issuer or the right of any of its officers to their respective offices. 4. To the vest of my knowledge, the adoption of the Resolution, the execution, delivery and performance of the Note and the Loan Agreement, and compliance with the terms thereof, under the circumstances contemplated thereby, do not and will not in any material respect conflict with, or constitute on the part of the Issuer a breach or default under, any indenture, mortgage, deed of trust, agreement or other instrument to which the Issuer or to which its properties are subject or conflict with, violate or result in a breach of any existing law, administrative rule or regulation, judgment, court order or consent decree to which the Issuer or its properties are subject. 5. The City's adoption of the Resolution, execution, delivery and performance of tine Loan Agreement and issuance of the Note are not subject to any authorization, consent, waiver, approval or review of any other goverinnental body, public officer or regulatory authority not heretofore obtained or effected. 6. Tile execution, issuance and delivery of tine Note have been duly and validly authorized by the City, and the Note constitutes a valid and binding limited obligation of the City enforceable in accordance with its terms. 7. The Issuer has the legal power to pledge the Pledged Revenues to provide for the repayment of the Note, as described in the Resolution and the Loan Agreement. 8. The issuance of the Note and the transactions arising from the Loan Agreement are not subject to the payment of documentary taxes. 9. All conditions contained in the ordinances and resolutions of the Issuer precedent to the issuance of the Note have been complied with. Notwithstanding the matters set forth in this letter, no opinions or representations are being made by the undersigned with respect to the Determination of Taxability of the Note, the federal and State of Florida tax-exempt status of the interest income on the Note, or securities laws of the State of Florida and the federal government, or the applicability or impact of such Office of the City Attorney P.O. Box 100. Edg water, FL 32132-0100 City of Edgewater, Florida Branch Banking and Trust Company _ Broad and Cassel LLP Page 3 of 3 laws on the Resolution, the Loan Agreement; the Note, and any other documents executed by the Issuer in furtherance of the transactions contemplated by such instruments. The opinions expressed herein are limited to the laws of the State of Florida and no opinion is expressed with respect to the laws of any other state or jurisdiction or with respect to the securities laws of the State of Florida and the federal government. The opinions expressed herein assunle that the execution, delivery and performance of the loan documents are within the power of the Bank, and will not violate or result in a breach of any term or provision of any agreement, judgment, non -Florida Statute, decree or administrative order to ,vhich the Batik is subject. The opinions expressed herein are predicated upon present law, facts and circumstances, and the undersigned assumes no affirmative obligation to update the opinions expressed herein if such laws, facts or circumstances change after the date hereof. Sincerely, Aaron R. Wolf City Attorney Office of the City Altdrnek P.O. Box 100 • Edgewater, FL 32.132-0100 (336) 424-2400. Ext: •1 101 'o Fax MM 424-2410 CERTIFICATE AS TO SIGNATURES, NO LITIGATION, INCUMBENCY AND OTHER MATTERS The undersigned, Michael Ignasiak, Mayor of the City of Edgewater, Florida (the "Issuer") and Robin L. Matusick, City Clerk, in connection with the issuance this day by the Issuer of the following described Note (the "Note"): $2,000,000 City of Edgewater, Capital Improvement Revenue Note, Series 2017, consisting of one fully -registered Note dated June 19, 2017, bearing interest at a fixed rate of 2.47% per annum, and maturing on June 1, 2032. DO HEREBY CERTIFY to the best of our knowledge, after reasonable investigation, that: I. The following terms in this Certificate shall have the following meanings (terms not defined herein shall have the meanings set forth in the Resolution): "Agreement" means the Loan Agreement, dated as of June 19, 2017, between the Bank and the Issuer. "Bank" means Branch Banking and Trust Company, a North Carolina state banking corporation. "Note" means the obligation described above. "Resolution" means that certain Resolution No. 2017-R-21, duly adopted by the City Council of the Issuer on June 15, 2017. II. Except as has otherwise been disclosed to the Bank, no litigation or other proceedings are pending or, to our knowledge, threatened against the Issuer in any court or other tribunal of competent jurisdiction, state or federal, in any way (i) restraining or enjoining the issuance, execution or delivery of the Note, or (ii) questioning or affecting the validity of the Note, the Agreement, or the Resolution, or (iii) questioning or affecting the validity of any of the proceedings for the authorization, sale, execution, issuance or delivery of the Note. 1 The following is a correct list of the names of the members of the City Council and of the dates of commencement and expiration of their respective terms of office: IV. The Issuer has complied with all agreements and has satisfied all conditions on its part to be observed or satisfied under the Resolution and the Agreement. The Issuer is not in default in performing any of the covenants and obligations assumed under the Resolution and the Agreement, and all payments therein required to have been made unto the accounts and funds, as provided thereunder, have been made to the full extent required. All necessary authorizations, approvals, licenses, permits, consents, waivers and orders of any governmental authority which are required to be obtained by the Issuer as a condition precedent to the due authorization, approval, execution and delivery of the Resolution, the Agreement and the Note have been obtained. V. The Resolution, the Agreement and the Note have been duly authorized, executed and delivered and constitute binding obligations of the Issuer enforceable in accordance with their respective terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy laws or other laws effecting creditors' rights and to the exercise of judicial discretion. The Resolution has not been repealed, revoked, rescinded or altered in any manner. VI. The Issuer is not in default, and has not been in default at any time as to principal of and interest on any of its indebtedness. VII. The Note is duly signed with the manual signatures of the undersigned Mayor and City Clerk of the Issuer. The undersigned Clerk does hereby certify that the signature set forth below of Michael Ignasiak, Mayor of the Issuer, is a true and correct specimen of his signature, and the undersigned Mayor does hereby certify that the signature set forth below of Robin L. Matusick, City Clerk of the Issuer, is a true and correct specimen of her signature, and the signatures appearing on said Note are the true and lawful signatures of the Mayor and City Clerk of the Issuer. 2 BEGINNING OF EXPIRATION OF OFFICE OFFICER TERM TERM Mayor Michael Ignasiak December 2014 December 2018 Councilwoman Christine Power December 2014 December 2018 Councilwoman Amy Vogt December 2016 December 2020 Councilman Daniel Blazi December 2014 December 2018 Councilman Gary Conroy December 2016 December 2020 IV. The Issuer has complied with all agreements and has satisfied all conditions on its part to be observed or satisfied under the Resolution and the Agreement. The Issuer is not in default in performing any of the covenants and obligations assumed under the Resolution and the Agreement, and all payments therein required to have been made unto the accounts and funds, as provided thereunder, have been made to the full extent required. All necessary authorizations, approvals, licenses, permits, consents, waivers and orders of any governmental authority which are required to be obtained by the Issuer as a condition precedent to the due authorization, approval, execution and delivery of the Resolution, the Agreement and the Note have been obtained. V. The Resolution, the Agreement and the Note have been duly authorized, executed and delivered and constitute binding obligations of the Issuer enforceable in accordance with their respective terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy laws or other laws effecting creditors' rights and to the exercise of judicial discretion. The Resolution has not been repealed, revoked, rescinded or altered in any manner. VI. The Issuer is not in default, and has not been in default at any time as to principal of and interest on any of its indebtedness. VII. The Note is duly signed with the manual signatures of the undersigned Mayor and City Clerk of the Issuer. The undersigned Clerk does hereby certify that the signature set forth below of Michael Ignasiak, Mayor of the Issuer, is a true and correct specimen of his signature, and the undersigned Mayor does hereby certify that the signature set forth below of Robin L. Matusick, City Clerk of the Issuer, is a true and correct specimen of her signature, and the signatures appearing on said Note are the true and lawful signatures of the Mayor and City Clerk of the Issuer. 2 VIII. We certify that to our knowledge no two or more members of the Issuer, meeting together, reached any prior conclusion as to whether the actions taken by the Issuer, with respect to the Note, the security therefor and the application of the proceeds thereof, should or should not be taken by the Issuer or should be recommended as an action to be taken or not to be taken by the Issuer, except at public meetings of the Issuer held after due notice to the public was given in the manner required by law and custom of the Issuer. IX. The authorization, execution, delivery, receipt and performance by the Issuer of the Note, the Agreement, the Resolution and all agreements, instruments and documents provided for or contemplated thereby do not violate the Act (as that term is defined in the Resolution) or any applicable judgment or order of any court and, to the knowledge of the Issuer, do not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, agreement or other instrument to which the Issuer is a party or is otherwise subject, nor do such actions result in any violation of the provisions of any resolution or indenture of the Issuer or any order, rule or regulation applicable to the Issuer of any court or of any federal, state or other regulatory issuer or governmental body having jurisdiction over the Issuer or any federal or state statute, order, rule or regulation applicable to the Issuer or any other provision of law. X. The seal which has been impressed upon this Certificate is the legally enacted, proper and only official seal of the Issuer and such seal has been imprinted upon the Note. Xl. In accordance with the provisions of Florida Statutes, Section 215.84(3), as of the date hereof, the Interest Rate on the Note does not exceed an average net interest cost rate, computed by adding 300 basis points to The Bond Buyer "20 Bond Index" published immediately preceding the first day of the calendar month in which the Note was issued. [Intentionally Left Blank — Signature Page Follows] 3 WITNESS, our hand and said official seal as of the 19"' day of June, 2017. (SEAL) SIGNATURE 2 OFFICIAL TITLE Michael Ignasiak, Mayor City of Edgewater, Florida Robin L. Matusick City Clerk/Paralegal City of Edgewater, Florida CERTIFICATE AS TO PUBLIC MEETINGS Each of the undersigned members of the City of Edgewater, Florida (the "City") does hereby certify as follows in connection with the authorization and issuance of that certain $2,000,000 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 (the "Note"): That he or she has no personal knowledge that two or more members of the City Council, meeting together reached any prior conclusion regarding the authorization or issuance of the Note or the delivery of the Note to Branch Banking and Trust Company, a North Carolina state banking corporation (the "Bank") to evidence a loan by the Bank to the City, except at public meetings of the City Council held after due notice given in the manner required. The undersigned further certify that he or she has no employment or direct commercial relationship with the Bank. Signed this y/19th�day of Ju , 2017 Michael Ay asiak, Ma istine Power, Councilwoman Amy Vogt, Councilwoman CERTIFICATE OF DELIVERY, PAYMENT AND APPLICATION OF PROCEEDS I, the undersigned, Mayor of the City of Edgewater, Florida, (the "Issuer"), DO HEREBY CERTIFY: 1. On June 19, 2017, the Issuer delivered to Branch Banking and Trust Company, a North Carolina state banking corporation (the "Bank"), its City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017, dated June 19, 2017, in the original principal amount of $2,000,000 (the "Note") in return for the receipt and availability of $2,000,000 from the Bank. 2. The proceeds of the Note in the amount of $2,000,000 are being used to provide funds to finance the Project. No proceeds advanced pursuant to the Note are being used for any private business use and no proceeds advanced pursuant to the Note are being loaned directly or indirectly to any entity other than the Issuer. All terms used herein in capitalized form and not otherwise defined herein shall have the same meanings as ascribed to them in Resolution No. 2017-R-21 relating to the Note, adopted by the City Council of Issuer on June 15, 2017. IN WITNESS WHEREOF, I have hereunto set my hand as of this 19th day of June, 2017. CITY OF EDGEWATER, FLORIDA By: /�C� � Michael Ignasiak, Mayor ATTEST: By: 2Z71;c:1C Robin L. Matusick, City Clerk Ci�'=_BROADAND ASSEL ATTORNEYS AT LAW June 19, 2017 VIA FEDERAL EXPRESS Internal Revenue Service 1973 N. Rulon White Blvd. Ogden, UT 84404 BANK OF AMERICA CENTER 390 NORTH ORANGE AVENUE SUITB 1400 ORLANDO, FL 32801 TELEPHONE: 407,839.4200 FAX 407.425, 8377 W WW.BROADANDCASSEL. COM JOSEPH STANTON,P.A. DIRECT LINE: 407.839,4210 EMAIL: JSTANTONQBROADANDCASSEL,COM Re: $2,000,000 City of Edgewater, Capital Improvement Revenue Note, Series 2017 Ladies and Gentlemen: On behalf of City of Edgewater, Florida, I have enclosed for filing Form 8038-G for the above -reference transaction. Thank you for your assistance. Sincerely, Joseph Stanton, P.A. Partner Enclosure BOCA RATON • DESTIN • FT. LAUDERDALE • JACKSONVILLE • MIAMI • ORLANDO • TALLAHASSEE • TAMPA • WEST PALM BEACH BROAD AND CASSEL LLP 4948-4425-9914.1 43 699/0009 JSTANTON RP Form 8038-G Information Return for Tax -Exempt Governmental Obligations 0 -Under Internal Revenue Code section 149(e) (Rev. September 2011) OMB No. 1545-0720 lo -See separate Instructions. Department of the Treasury Caution: If the issueprice is under $100,000, use Form 8038 -GC Internal Revenue Service - Reporting Authority If Amended Return, check here ► ❑ 1 Issuer's name 2 Issuer's employer Identification number (EIN) City of Edgewater, Florida 59-6000314 3a Name of person (other than issuer) with whom the IRS may communicate about this return (see Instructions 3b Telephone number of other person shown on 3a Joseph B. Stanton 407-838-4200 4 Number and street (or P.O. box If mall Is not delivered to street address) Room/Suite 5 Report number For IRS Use Only) . 390 N. Orange Ave., Suite 1400 15 13 ?ta��'�F I; ,5`,,i I�� ,• };t 6 City, town, or post office, state, and ZIP code 7 Date of Issue Orlando, Florida 32801 June 19, 2017 8 Name of issue 9 CUSIP number Capital Improvement Revenue Note, Series 2017 N/A 10a Name and title of officer or other employee of the Issuer whom the IRS may call for more information (see lob Telephone number of officer or other employee Instructions shown on 10a John McKinney, Assistant City Manager 386-424-2400 ext. 1302 (a) Final maturity date I ype of Issue (enter the issue price) bee Instructions and attach schedule (c) Stated redemption price at maturity (d) Weighted average maturity (e) Yield 11 12 13 14 15 16 17 18 19 20 Education: ............................................................................................................................................. Health and hospital............................................................................................................................... Transportation....................................................................................................................................... Public safety..; ....................................................................................................................................... Environment (including sewage bonds)................................................................................................ Housing................................................................................................................................................. Utilities.................................................................................................................................................. Other. Describe ► Parks and Recreation If obligations are TANs or RANs, check only box 19a ....................................................... ► ❑ If obligations are BANS, check only box 19b................................................................... ► ❑ If obligations are in .the form of a lease or installment sale, check box ...........................:..... ► ❑3 11 8.4205 years 12 13 14 15 16 17 18 $2,000,000 aY :far ',,: _ , a.`:;�<..k Description of Obligations Complete for the entire issue for which this form is being filed. (a) Final maturity date (b) Issue Price (c) Stated redemption price at maturity (d) Weighted average maturity (e) Yield 21 06/1/2032 $2,000,000 $2,000,000 8.4205 years 2.4701% Uses of Proceeds of Issue (includina underwriters' discount) 22 Proceeds used for accrued interest............................................................................................................ 22 0 23 Issue price of entire issue (enter amount from line 21, column (b))............................................................ 23 $2,000,000 24 Proceeds used for bond issuance costs (including underwriters' discount) ........... 24 $ 0� 25 Proceeds used for credit enhancement .............. 26 Proceeds allocated to reasonably required reserve or replacement fund .............. 26 M` 27 Proceeds used to currently refund prior issues ...................................................... 27 t 28 Proceeds used to advance refund prior issues ...................................................... 28�, 29 Total (add lines 24 through 28)................................................................................................................... 29 $ 0 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) ....................... 30 $2,000,000 Description of Refunded Bonds (Complete this part only for refunding bonds.) 31 Enter the remaining weighted average maturity of the bonds to be currently refunded ....................... ► 32 Enter the remaining weighted average maturity of the bonds to be advance refunded ........................ ► 33 Enter the last date on which the refunded bonds will be called(MM/DD/YYYY).................................. ► 34 Enter the date(s) the refunded bonds were issued ► (MM/DD/YYYY) For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773S years Form 8038-G (Rev. 9-2011) Form 8038-G (Rev. 9-2011 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) .......................... 35 N/A 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract �fflg N/A (GIC) (see instructions)..................................................................................................................... 36a b Enter the final maturity date of the GIC 0- .% `fr, c Enter the name of the GIC provider 0-�y 37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans to fl, N/A othergovernmental units........................................................................................................ 37 38a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► ❑ and enter the following information: b Enter the date of the master pool obligation ► c enter the EIN of the issuer of the master pool obligation ► d Enter the name of the issuer of the master pool obligation ► 39 If the issuer has designated the issue under section 265(b)(3)(13)(i)(III) (small issuer exception), check box ............................. 0-0 40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box.........................................................................►❑ 41a If the issuer has identified a hedge, check box here 0,- El and enter the following information: b Name of hedge provider 0- c c Type of hedge 0- d d Term of hedge 0- 42 42 If the issuer has superintegrated the hedge, check box-----------------------------------------------------------------------------------------------►❑ 43 If the issuer has established written procedures to ensure that all nonqualified bonds of the issue are remediated according to the requirement under the Code and Regulation (see instruction), check box - -- - --------------------------------------------------------------•,►0 44 If the issuer has established written procedures to monitor the requirements of section 148, check box --...•..• __________________►E1 45a If some portion of the proceeds was used to reimburse expenditures, check here ► and enter amount of reimbursement ► b Enter the date the official intent was adopted 0 - Under Under penalties of per)ury, I declare that I have examined this return, and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. I further declare that I consent to the IRS's disclosure of the issuer's return Information, as necessary Signature to process thl retur to the pers that I have authorized above. and Consent ➢ / ➢ John McKinney, Assistant City Manager Sig ure o suer's authorized re resentative Date Tvoe or orint name and title Print/Type preparer's name Pr are ' ignature Date PTIN Paid Joseph B. Stanton .4. r June 19, 2017 Check If P01695167 Iter Self-employed ❑ Preparer's Use Only Firms Name ► Broad and Cas el I EIN ► 59-3389783 Firms Address ► 390 N. Orange Ave., Suite 1400, Orlando, FL 32801 1 Phone no. 407-839-4200 Form 8038-G (Rev. 9-2011) Page 2 of 2 FedEx,,, Shipment Receipt Address Information Ship to: Select or enter Internal Revenue Service 1973 North Rulon White Boulevard OGDEN, UT 84404 US 801 626 0753 Ship from: Rachel Pritchard BROAD 390 North Orange Avenue Suite 1400 Orlando, FL 32801 US 4074815214 Shipment Information: Tracking no.: 779435592367 Ship date: 06/19/2017 Estimated shipping charges: 23.69 USD Package Information Pricing option: FedEx Standard Rate Service type: Priority Overnight Package type: FedEx Pak Number of packages: 1 Total weight: 1 LBS Declared Value: 0.00 USD Special Services: Pickup/Drop-off: Use an already scheduled pickup at my location Billing Information: Bill transportation to: BROAD & CASSEL-480 Your reference: 43699/0009/1292 P.O. no.. Invoice no.: Department no.: Thank you for shipping online with FedEx ShfpManager at fedex.com. 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TAX CERTIFICATE The undersigned, John McKinney, as Assistant City Manager of the City of Edgewater, Florida (the "City"), hereby certifies the following with respect to the $2,000,000 principal amount of the City's Capital Improvement Revenue Note, Series 2017 (the "Series 2017 Note") being issued on the date hereof pursuant to Chapter 166, Part II, Florida Statutes, and the following resolution: Resolution No. 2017-R-21 adopted by the City on June 15, 2017, which, among other things, authorized the execution and delivery of this Agreement and the issuance of the Note (the "Resolution"). Capitalized terms used herein shall have the respective meanings set forth in the Resolution and that certain Loan Agreement, dated as of the date hereof, by and between the City and the Lender (defined herein). 1. Purpose of the Series 2017 Note. The Series 2017 Note is being issued to purchase approximately twenty-seven (27) acres of land within the City limits, for the purposes of constructing a public water front park, including a boat ramp, playground, fishing piers and related amenities, and related costs of issuance in connection with the issuance of the Note (the "Project"). 2. Proceeds of the Series 2017 Note. The City reasonably expects the following with respect to the use of the proceeds of the Series 2017 Note: (a) The sale proceeds received by the City from the sale of the Series 2017 Note are $2,000,000 (the "2017 Sale Proceeds") which is the aggregate principal amount of the Series 2017 Note will be deposited into the Project Fund. (b) The 2017 Sale Proceeds will not exceed the amount necessary for the governmental purposes of the Series 2017 Note. 3. Payment of the Series 2017 Note. In accordance with the terms of the Resolution, the Series 2017 Note is secured by a pledge of and lien upon the funds distributed to the City from the Local Government Half -Cent Sales Tax Clearing Trust Fund, as defined in Part VI of Chapter 218, Florida Statutes. 4. Yield on the Series 2017 Note. (a) The yield on the Series 2017 Note (determined as the semiannual discount rate at which the present value of payments of principal and interest on the Series 2017 Note equals the issue price of the Series 2017 Note) has been determined by the financial advisor to be 2.4701% (the "Note Yield"). For purposes of this calculation, the issue price of the Series 2017 Note is $2,000,000, representing the aggregate principal amount of the Series 2017 Note. A certificate of the financial advisor regarding the Note Yield is attached as Exhibit A. (b) The Series 2017 Note has been issued by the City to Branch Bank and Trust Company (the "Lender") in an amount equal to the principal amount of the loan provided by the Lender to the City, which loan was entered into pursuant to an arm's length negotiation between the parties. Certificates of the Lender with respect to the Series 2017 Note are provided in the transcript of proceedings. 5. Arbitrage Rebate. The 2017 Loan Proceeds are expected to be spent on or before 24 months of the date hereof and are therefore expected to be eligible for a spending exception from rebate provided under applicable Treasury Regulation as described below: Six Month Exception to the General Rule. If all 2017 Loan Proceeds (including earnings thereon) are spent within six months of today, other than amounts deposited in a reasonably required reserve fund or a bona fide debt service fund, no rebate is required except as described below in the case of an issue secured by a reasonably required reserve fund or in the case of unexpected gross proceeds arising after today. If all proceeds (including earnings thereon) required to be spent are so spent within this six-month period, except for 5% of the Bond proceeds, and the 5% (plus earnings thereon) are spent within one year from today, no rebate is required except as described below in the case of an issue secured by a reasonably required reserve fund. If the issue is secured by a reasonably required reserve fund, rebate is required on the reserve fund from the date the Bonds are issued, but not on the other funds. To qualify for the six-month exception, there must be no collateral having an investment yield (as contrasted with a mortgage of real property) pledged to, or otherwise available for, the payment of the Series 2017 Note other than a reasonably required reserve or replacement fund or a bona fide debt service fund. Even if Series 2017 Note proceeds qualify for this exception, there may be required rebate with respect to any amounts that arise or are pledged to the payment of the Series 2017 Note at a later date. Eighteen -Month New Money Bond Exception to the General Rule. If all 2017 Loan Proceeds, other than those in a reasonably required reserve or replacement fund, or a bona fide debt service fund, are expended in accordance with the spend -down requirements set forth below, then rebate will only be required with respect to a reasonably required reserve or replacement fund or unexpected gross proceeds arising after today, if any. PERIOD SPEND -DOWN REQUIREMENT 6 months 15% 12 months 60% 18 months 100% (except for reasonable retainages up to 5%) 30 months all reasonable retainages must be spent To test these percentages for the six-month and 12 -month periods, earnings reasonably expected at closing are used to calculate the total to which the percentages are applied. Actual earnings are used for the 18 -month period test. If the Borrower exercises due diligence to complete the Project and an amount not exceeding the lesser of three percent of the issue price of the Series 2017 Note or $250,000 remains unspent as of the 18th month, the final expenditure requirement will be met. If the issue is secured by a reasonably required reserve fund, rebate is required on the reserve fund from the date the Series 2017 Note is issued, but not the other funds. To qualify for the 18 -month exception, there must be no collateral having an investment yield (as contrasted with a mortgage of real property) pledged to, or otherwise available for, the payment of the Series 2017 Note other than a reasonably required reserve or replacement fund or a bona fide debt service fund. Even if new money bond proceeds qualify for this exception, there may be 2 required rebate with respect to any amounts that arise or are pledged to the payment of the Series 2017 Note at a later date. Two -Year New Money Bond Construction Expenditure Exception to the General Rule. Rebate can also be avoided in the case of a new money bond issue 75% of the "available construction proceeds" of which are reasonably expected to be used for construction expenditures (with respect to property that is owned by a governmental unit or a 501(c)(3) organization) and the proceeds of which are spent in accordance with the spend -down requirements set forth below, except as described below. In general, amounts in a reasonably required reserve fund are subject to rebate as of the earlier of substantial completion of construction or the date two years from the date of issuance of the Bonds. A number of elections, which are required to be made today, affect how this exception works. The Issuer may elect to exclude the earnings on a reasonably required reserve fund from construction proceeds. In that event, all earnings on the reasonably required reserve fund will be subject to rebate. PERIOD SPEND -DOWN REQUIREMENT 6 months 10% 12 months 45% 28 months 75% 24 months 100% (except for reasonable retainages up to 5%) 36 months all reasonable retainages must be spent In addition, if the Borrower exercises due diligence to complete the Project, an amount not exceeding the lesser of three percent of the issue price of the issue or $250,000 may be disregarded in testing compliance with the 24 month spend -down requirement if the reasonable retainage is not used, or the 36 month spend -down requirement if the reasonable retainage is used. Gross proceeds used to pay costs of issuance are not available construction proceeds and expenditures for costs of issuance do not count towards meeting the spending requirements. If, however, the requirements are met, and all costs of issuance are paid within two years, no rebate is required on amounts used to pay such costs. Available construction proceeds include earnings on other available construction proceeds. For the first three periods the Issuer and the Borrower must use reasonable expectations regarding future investment earnings in calculating such expenditure requirements. The Issuer has not elected to use actual facts rather than reasonable expectations as to future earnings. The Issuer has not elected to base the 75% construction rule on actual facts rather than reasonable expectations as of the date of issuance. Even if New Money Bond proceeds qualify for this exception, there may be required rebate with respect to any amounts that arise or are pledged to the payment of the Bonds at a later date. The City agrees to comply with the Arbitrage Rebate Covenants attached as 3 Exhibit B to this Certificate with respect to any amounts not excepted from the rebate requirement. 6. Private Activity Bond Tests. (a) The City reasonably expects that the Series 2017 Note will not meet the private business test of section 141(b) of the Code for the entire term of the Series 2017 Note (the "private business test"). The private business test under section 141(b) is met if. (i) more than 10% of the proceeds of the Series 2017 Note is to be used for any private business use (the "private use test"); and (ii) the payment of principal of or interest on more than 10% of the proceeds of the Series 2017 Note is (under the terms of such issue or any underlying arrangement) directly or indirectly (1) secured by any interest in property used or to be used for a private business use, or payments in respect of such property, or (2) to be derived from payments (whether or not to the issuer) in respect of property, or borrowed money, used or to be used for a private business use (the "private payment test"). The 10% limit described above is reduced to 5% if the private business use is unrelated or disproportionate to the governmental use. (b) The City does not expect to meet the private loan financing test of section 141(c) of the Code. (c) The City will be the owner of the Project for federal income tax purposes for the term of the Series 2017 Note. Except as otherwise advised by nationally recognized bond counsel, during the period that the Series 2017 Note is outstanding, the City will not enter into any lease with, or otherwise grant special legal entitlements to, any entity other than a governmental entity, or enter into any management or service contract with any entity other than a governmental entity for the operation of any portion of the Project unless the management or service contract complies with the guidelines provided in Revenue Procedure 2017-13 or such other authority as may control at the time. (d) The City represents that the Project will be owned and operated in a manner which complies with the requirements set forth in this section, and reasonably expects that the Project will continue to be so owned and operated throughout the term of the Series 2017 Note. The City will not change the ownership or use of all or any portion of the Project in a manner that fails to comply with the requirements of this section unless it receives an opinion of nationally recognized bond counsel that such change of ownership or use will not adversely affect the exclusion from gross income of interest on the Series 2017 Note for federal income tax purposes. 7. Other Tax Representations. (a) Other than the Series 2017 Note, there are no other obligations of the City which have been or will be sold within 15 days of the date hereof, sold pursuant to the same plan of financing, and that are expected to be paid from substantially the same source of funds. M (b) The payment of principal and interest with respect to the Series 2017 Note will not be guaranteed (in whole or in part) by the United States or any agency or instrumentality of the United States. The proceeds of the Series 2017 Note, or amounts treated as proceeds of the Series 2017 Note, will not be invested (directly or indirectly) in federally insured deposits or accounts, except to the extent such proceeds (i) may be so invested for an initial temporary period until needed for the purpose for which the Series 2017 Note is being issued, (ii) may be so used in making investments of a bona fide debt service fund, or (iii) may be invested in obligations issued by the United States Treasury. (c) The weighted average maturity of the Series 2017 Note is 8.4205 years which does not exceed 120 percent of the average reasonably expected remaining useful life of the Project. (d) The Series 2017 Note is not a "hedge bond" within the meaning of section 149(g) of the Code and Treasury Regulation §1.149(g)-1 because: (i) the City reasonably expects that 85% of the spendable proceeds of the Series 2017 Note will be used to carry out the governmental purpose of the Series 2017 Note within the three-year period beginning on the date of issuance of the Series 2017 Note and not more than 50% of the proceeds of the Series 2017 Note will be invested in nonpurpose investments having a substantially guaranteed yield for four years or more. The Series 2017 Note is not being issued to hedge against future increases in interest rates. (e) The City agrees to maintain copies of all leases, management contracts, service contracts or similar agreements that provide preferential use arrangements regarding use of the Project with entities who are not governmental entities for the term of the Series 2017 Note (including any notes or bonds issued to refund the Series 2017 Note) and for a period of three years thereafter. (f) The City has designated the Series 2017 Note as a "qualified tax- exempt obligation" within the meaning of Section 265(b)(3)(B) of the Code, based on its determination that: (a) the aggregate face amount of all currently outstanding "tax-exempt" bonds or other "tax-exempt" obligations (other than private activity bonds as defined in Section 141(a) of the Code), including the Series 2017 Note, issued by the City (and any subordinate entities thereof and any issuer of "tax-exempt" debt that issues "on behalf of' the City) during calendar year 2017 does not exceed $10,000,000; and (b) based upon reasonable investigation, it is not reasonably expected that the City and any subordinate entities thereof and any issuer of "tax exempt" debt that issues "on behalf of the City) will issue in excess of $10,000,000 of tax- exempt debt during calendar year 2017. [Signature page follows on next page.] 5 To the best of my knowledge, information and belief, the expectations stated in this Certificate are reasonable. WITNESS my hand this 19th day of June, 2017. CITY OF EDGEWATER, FLORIDA By: John Kc Kinney Assistant City Manager [Signature page of Tax Certificate] EXHIBIT A CERTIFICATE OF FINANCIAL ADVISOR The undersigned, as Financial Advisor to the City of Edgewater, Florida in connection with the sale of its $2,000,000 Capital Improvement Revenue Note, Series 2017 (the "Series 2017 Note"), hereby represents that we have calculated the yield on the Series 2017 Note to be 2.4701 percent and the weighted average maturity of the Series 2017 Note as 8.4205 years, as set forth in the Arbitrage and Tax Certificate executed on this date by the City. FIRST SOUTHWEST, a Division of Hilltop Securities Inc. l By: Name: M&v' l P Com. v Title: I,Y P c Q A-1 EXHIBIT B ARBITRAGE REBATE COVENANTS The City hereby agrees to the following procedures in order to ensure that the Series 2017 Note will comply with the Code and Regulations (as defined below) with respect to certain restrictions on arbitrage. ARTICLE I Definitions Section 101. Terms not otherwise defined in Section 102 hereof shall have the meanings given to them in the Arbitrage and Tax Certificate delivered today by the City in connection with the issuance of the Series 2017 Note. Section 102. The following terms shall have the following meanings: Note Counsel's Opinion shall mean an opinion signed by an attorney or firm of attorneys of nationally recognized standing in the field of law relating to municipal bonds selected by the City. Note Year shall mean each one-year period beginning on the day after the expiration of the preceding Note Year. The first Note year shall begin on the date of issue of the Series 2017 Note and shall end on the date selected by the City, provided that the first Note Year shall not exceed one calendar year. The last Note Year shall end on the date of retirement of the Series 2017 Note. Note Yield is 2.4701 % percent. Note Yield shall be recomputed if required by Regulations section 1.148-4(b)(4) or 4(h)(3). Note Yield shall mean the discount rate that produces a present value equal to the present value of the Issue Price of all unconditionally payable payments of principal, interest and fees for qualified guarantees within the meaning of Regulations section 1.148-4(f) and amounts reasonably expected to be paid as fees for qualified guarantees in connection with the Series 2017 Note as determined under Regulations section 1.148-4(b). The present value of all such payments shall be computed as of the date of issue of the Series 2017 Note and using semi-annual compounding on the basis of a 360 -day year. Code shall mean the Internal Revenue Code of 1986, as amended, and any successor provisions thereto. Gross Proceeds shall mean: (a) any amounts actually or constructively received by the City from the sale of the Series 2017 Note but excluding amounts used to pay accrued interest on the Series 2017 Note within one year of the date of issuance of the Series 2017 Note; (b) transferred proceeds of the Series 2017 Note under Regulations section 1.148-9; (c) any amounts actually or constructively received from investing amounts described in (a), (b) or this (c); and (d) replacement proceeds of the Series 2017 Note within the meaning of Regulations section 1.148-1(c). Replacement proceeds include amounts reasonably expected to be used directly or indirectly to pay debt service on the Series 2017 Note, pledged amounts where there is reasonable assurance that such amounts will be available to pay principal or interest on the Series 2017 Note in the event the City encounters financial difficulties and other replacement proceeds within the meaning of Regulations section 1.148-1(c)(4). Whether an amount is Gross Proceeds is determined without regard to whether the amount is held in any fund or account established under the Resolution. Investment Property shall mean any security, obligation (other than a tax-exempt bond within the meaning of Code section 148(b)(3)(A)), annuity contract or investment -type property within the meaning of Regulations section 1.148-1(b). Issue Price is $2,000,000, which is equal to the aggregate principal amount of the loan by the Lender to the City. Issue price shall be determined as provided in Regulations section 1.148-1(b). Nonpurpose Investment shall mean any Investment Property acquired with Gross Proceeds, and which is not acquired to carry out the governmental purposes of the Series 2017 Note. Payment shall mean any payment within the meaning of Regulations section 1.148- 3(d)(1) with respect to a Nonpurpose Investment, Rebate Requirement shall mean at any time the excess of the future value of all Receipts over the future value of all Payments. For purposes of calculating the Rebate Requirement the Note Yield shall be used to determine the future value of Receipts and Payments in accordance with Regulations section 1.148-3(c). The Rebate Requirement is zero for any Nonpurpose Investment meeting the requirements of a rebate exception under section 148(f)(4) of the Code or Regulations section 1.148-7. Receipt shall mean any receipt within the meaning of Regulations section 1.148-3(d)(2) with respect to a Nonpurpose Investment. Regulations shall mean the sections 1.148-1 through 1.148-11 and section 1.150-1 of the regulations of the United States Department of the Treasury promulgated under the Code, including any amendments thereto or successor regulations. Yield shall mean the discount rate that, when used in computing the present value as of the date the Nonpurpose Investment is first allocated to the Series 2017 Note of all unconditionally payable receipts from the Nonpurpose Investment, produces an amount equal to the present value of all unconditionally payable payments for the Nonpurpose Investment, using the same compounding interval and financial convention used to compute the Note Yield. The purchase price of a Nonpurpose Investment is the amount of Gross Proceeds directly used to M. purchase the investment (including brokerage commissions and other qualified administrative costs within the meaning of Regulations section 1.148-5(e)(2)) or, if not so directly purchased, its value (as determined under Regulations section 1.148-5(d)) on the date it becomes a Nonpurpose Investment. ARTICLE II Rebate Payments Section 201. The City shall pay to the United States of America: (a) not later than 60 days after the end of the fifth Note Year and every fifth Note Year thereafter, an amount which, when added to the future value of all previous rebate payments with respect to the Series 2017 Note (determined as of the last day of such Note Year), is equal to at least 90% of the Rebate Requirement (determined as of the last day of such Note Year); and (b) not later than 60 days after the retirement of the Series 2017 Note, an amount which, when added to the future value of all previous rebate payments with respect to the Series 2017 Note (determined as of the date of retirement of the last Series 2017 Note), is equal to 100% of the Rebate Requirement (determined as of the date of retirement of the last Series 2017 Note). Each payment required to be made under this Section shall be filed with the Internal Revenue Service, Ogden Submission Processing Center, Ogden, Utah 84201, on or before the date such payment is due, and shall be accompanied by IRS Form 8038-T. ARTICLE III Investments Section 301. No Nonpurpose Investment shall be acquired for an amount in excess of its fair market value. No Nonpurpose Investment shall be sold or otherwise disposed of for an amount less than its fair market value. Section 302. For purposes of Section 301, whether a Nonpurpose Investment has been purchased or sold or disposed of for its fair market value shall be determined as follows: (a) The fair market value of a Nonpurpose Investment generally shall be the price at which a willing buyer would purchase the Nonpurpose Investment from a willing seller in a bona fide arm's length transaction. Fair market value shall be determined on the date on which a contract to purchase or sell the Nonpurpose Investment becomes binding. (b) Except as provided in Section 303 and 304, a Nonpurpose Investment that is not of a type traded on an established securities market, within the meaning of Code section 1273, is rebuttably presumed to be acquired or disposed of for a price that is not equal to its fair market value. (c) If a United States Treasury obligation is acquired directly from or sold or disposed of directly to the United States Treasury, such acquisition or sale or disposition shall be treated as establishing the fair market value of the obligation. Section 303. The purchase price of a certificate of deposit that has a fixed interest rate, a fixed payment schedule and a substantial penalty for early withdrawal is considered to be its fair market value if the yield on the certificate of deposit is not less than: (a) the yield on reasonably comparable direct obligations of the United States; (b) the highest yield that is published or posted by the provider to be currently available from the provider on reasonably comparable certificates of deposit offered to the public. Section 304. A guaranteed investment contract shall be considered acquired and disposed of for an amount equal to its fair market value if (a) A bona fide solicitation in writing for a specified guaranteed investment contract, including all material terms, is timely forwarded to all potential providers. The solicitation must include a statement that the submission of a bid is a representation that the potential provider did not consult with any other potential provider about its bid, that the bid was determined without regard to any other formal or informal agreement that the potential provider has with the City or any other person (whether or not in connection with the Series 2017 Note), and that the bid is not being submitted solely as a courtesy to the City or any other person for purposes of satisfying the requirements in the Regulations that the City receive bids from at least one reasonably competitive provider and at least three providers that do not have a material financial interest in the Series 2017 Note. (b) All potential providers have an equal opportunity to bid, with no potential provider having the opportunity to review other bids before providing a bid. (c) At least three reasonably competitive providers (i.e. having an established industry reputation as a competitive provider of the type of investments being purchased) are solicited for bids. At least three bids must be received from providers that have no material financial interest in the Series 2017 Note (e.g., a lead underwriter within 15 days of the issue date of the Series 2017 Note or a financial advisor with respect to the investment) and at least one of such three bids must be from a reasonably competitive provider. If the City uses an agent to conduct the bidding, the agent may not bid. (d) The highest -yielding guaranteed investment contract for which a qualifying bid is made (determined net of broker's fees) is purchased. (e) The determination of the terms of the guaranteed investment contract takes into account as a significant factor the reasonably expected deposit and drawdown schedule for the amounts to be invested. I (f) The terms for the guaranteed investment contract are commercially reasonable (i.e., have a legitimate business purpose other than to increase the purchase price or reduce the yield of the guaranteed investment contract). (g) The provider of the investment contract certifies the administrative costs (as defined in Regulations section 1.148-5(e)) that it pays (or expects to pay) to third parties in connection with the guaranteed investment contract. (h) The City retains until six years after the Series 2017 Note is retired, (i) a copy of the guaranteed investment contract, (ii) a receipt or other record of the amount actually paid for the guaranteed investment contract, including any administrative costs paid by the City and a copy of the provider's certification described in (g) above, (iii) the name of the person and entity submitting each bid, the time and date of the bid, and the bid results and (iv) the bid solicitation form and, if the terms of the guaranteed investment contract deviates from the bid solicitation form or a submitted bid is modified, a brief statement explaining the deviation and stating the purpose of the deviation. ARTICLE IV Further Assurances Section 401. The City shall take all necessary and desirable steps to comply with the requirements hereunder in order to ensure that interest on the Series 2017 Note is excluded from gross income for federal income tax purposes under the Code; provided, however, compliance with any such requirement shall not be required in the event the City receives a Note Counsel's Opinion that either: (i) compliance with such requirement is not required to maintain the exclusion from gross income of interest on the Series 2017 Note, or (ii) compliance with some other requirement will meet the requirements of the Code. In the event the City receives such a Note Counsel's Opinion, the City agrees to amend these Covenants to conform to the requirements set forth in such opinion. Section 402. If for any reason any requirement hereunder is not complied with, the City shall take all necessary and desirable steps to correct such noncompliance within a reasonable period of time after such noncompliance is discovered is discovered or should have been discovered with the exercise of reasonable diligence and the City shall pay any required interest or penalty under Regulations section 1.148-3(h). BANK QUALIFIED CERTIFICATE Broad and Cassel Orlando, Florida The undersigned, Assistant City Manager of the City of Edgewater, Florida (the "Issuer"), does hereby certify on behalf of the Issuer in connection with the issuance of its Capital Improvement Revenue Note, Series 2017, in the principal amount of $2,000,000 (the "Note") as follows: 1. I have reviewed financial information of the Issuer and have determined that the aggregate face amount of all currently outstanding "tax-exempt" bonds or other "tax-exempt" obligations (other than private activity bonds as defined in Section 141(a) of the Internal Revenue Code of 1986, as amended (the "Code")), including the Note, issued by the Issuer (and any subordinate entities thereof and any issuer of "tax-exempt" debt that issues "on behalf of' the Issuer) during calendar year 2017 does not exceed $10,000,000. Based upon reasonable investigation, it is not reasonably expected that the Issuer (and any subordinate entities thereof and any issuer of "tax exempt" debt that issues "on behalf of the Issuer) will issue in excess of $10,000,000 of tax-exempt debt during calendar year 2017. 2. Pursuant to Resolution No. 2017-R-21 adopted by the City Council of the Issuer on June 15, 2017, the Issuer has designated the Note as a "qualified tax-exempt obligation" within the meaning of Section 265(b)(3)(B) of the Code. Based on the factual representations set forth in this certificate, Note Counsel is rendering its opinion regarding the status of the Note as a "qualified tax-exempt obligation" under Section 265(b)(3) of the Code. EXECUTED as of this 10 day of June, 2017. CITY OF EDGEWATER, FLORIDA (SEAL) By: Jo cKinney, Assistant City Manager RECEIPT FOR NOTE RECEIPT IS HEREBY ACKNOWLEDGED of the following described obligation of the City of Edgewater, Florida (the "Issuer"): $2,000,000 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017, consisting of one fully -registered Note dated June 19, 2017, bearing interest at a fixed rate of 2.47%, per annum, and maturing on June 1, 2032. Dated this 19`x' day of June, 2017. BRANCH BANKING AND TRUST COMPANY B: Y Name: Andrew G. Smith Title: Senior Vice President 4813-4015-2905.1 436990009 DISCLOSURE LETTER In connection with the proposed issuance by the City of Edgewater, Florida (the "Issuer") of its City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 in the principal amount of $2,000,000 (the "Series 2017 Note"), Branch Banking and Trust Company (the "Bank") has agreed to purchase the Series 2017 Note upon the terms and conditions as are set forth in that certain Loan Agreement dated as of June 19, 2017 between the Issuer and the Bank (the "Loan Agreement"). Prior to the issuance of the Series 2017 Note, the following information is hereby furnished to the Issuer: 1. Set forth immediately below is an itemized list of the nature and estimated amounts of expenses to be incurred for services rendered to the Bank in connection with the issuance of the Series 2017 Note (such fees and expenses to be paid by the Issuer): Bank Counsel Fees: $5,000.00 2. (a) No fee, bonus or other compensation is estimated to be paid by the Bank in connection with the issuance of the Series 2017 Note to any person not regularly employed or retained by the Bank (including any "finder" as defined in Section 218.386(1)(a), Florida Statutes), except as described in paragraph 1 above. (b) No person has entered into an understanding with the Bank, or to the knowledge of the Bank, with the Issuer, for any paid or promised compensation or valuable consideration, directly or indirectly, expressly or implied, to act solely as an intermediary between the Issuer and the Bank or to exercise or attempt to exercise any influence to effect any transaction in the purchase of the Series 2017 Note. 3. No underwriting spread will be realized by the Bank. 4. No management fee will be charged by the Bank. 5. Truth -in -Bonding Statement: The Series 2017 Note is being issued to fund the cost of the Project (as defined in the hereinafter described Resolution). Unless earlier redeemed, the Series 2017 Note is expected to be repaid by June 1, 2032. At an annual interest rate of 2.470%, total interest paid over the life of the Series 2017 Note is estimated to equal $415,972.70. The Series 2017 Note will be payable solely from the Pledged Revenues (as defined in the Resolution) in the manner and to the extent described in Resolution No. 2017-R-21, adopted by the Issuer on June 15, 2017 (the "Resolution"). 6. The name and address of the Bank is as follows: Branch Banking and Trust Company Attention: Governmental Finance 4842-1076-0777.2 43699/0009 5130 Parkway Plaza Blvd., Building No. 9 Charlotte, North Carolina 28217 IN WITNESS WHEREOF, the undersigned has executed this Disclosure Letter on behalf of the Bank this 19°i day of June, 2017. BRANCH BANKING AND TRUST COMPANY ell01 By: Name: And ew G. Smith Title: Senior Vice President BANK'S CERTIFICATE This is to certify that Branch Banking and Trust Company, a North Carolina state banking corporation (the "Bank") has not required the City of Edgewater, Florida (the "Issuer") to deliver any offering document and has conducted its own investigation, to the extent it deems satisfactory or sufficient, into matters relating to business affairs or conditions (either financial or otherwise) of the Issuer in connection with the issuance of the $2,000,000 City of Edgewater, Florida, Capital Improvement Revenue Note, Series 2017 (the "Note") and no inference should be drawn that the Bank, in the acceptance of the Note, is relying on Broad and Cassel LLP (the "Note Counsel") or Doran Sims Wolfe & Ciocchetti (the "City Attorney") as to any such matters other than the legal opinions rendered by Note Counsel and by the City Attorney. Any capitalized undefined terms used herein not otherwise defined shall have the meaning set forth in Resolution No. 2017-R-21 adopted by the Issuer on June 15, 2017 (the "Resolution"). We are in possession or have access to all material information concerning the Note, and, as a result, thereof, we are thoroughly familiar with the nature and risks of an investment in the Note. We have been afforded access to all material information and have had sufficient opportunity to discuss the business of the Issuer and the Project to be financed with the proceeds of the Note, with the Issuer's officers, employees and others, and we have been permitted to make an investigation of the Issuer and its operations. We do not require any further information or data concerning the Issuer. We have knowledge and experience in financial and business matters, particularly in tax- exempt obligations, and we are capable of evaluating the merits and risks of our investment, and we have determined that we can bear the economic risk of our investment in the Note. We acknowledge and understand that the Resolution is not being qualified under the Trust Indenture Act of 1939, as amended, and is not being registered in reliance upon the exemption from registration under Section 3(a)(2) of the Securities Act of 1933, Section 517.051(1), Florida Statutes, and/or Section 517.061(7), Florida Statutes, and that neither the Issuer, the Note Counsel nor the City Attorney shall have any obligation to effect any such registration or qualification. We acknowledge that the Loan will not have a CUSIP number associated with it, and there will be no credit rating obtained on the Loan. We are not acting as a broker or other intermediary, and are purchasing the Note as an investment for our own account and not with a present view to a resale or other distribution to the public. We are a bank as contemplated by Section 517.061(7), Florida Statutes. We are not purchasing the Note for the direct or indirect promotion of any scheme or enterprise with the intent of violating or evading any provision of Chapter 517, Florida Statutes. We acknowledge and understand that the Note is issued in a single denomination equal to the aggregate principal amount of the Loan, and may not be transferred except in whole, and will not be transferred to any kind of trust under any circumstances. The Note will only be sold to a Permitted Lender, with the Issuer's consent. For purposes of this Certificate, a "Permitted Lender" means any bank, trust company, savings institution or insurance company that is engaged as a regular part of its business in making loans authorized to do business in the State of Florida. Neither we nor any of our affiliates shall act as a fiduciary for the Issuer or in the capacity of broker, dealer, municipal securities underwriter or municipal advisor with respect to the proposed issuance of the Note. Neither we nor any of our affiliates has provided, and will not provide, financial, legal, tax, accounting or other advice to or on behalf of the Issuer with respect to the proposed issuance of the Note. The Issuer has represented to us that it has sought and obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms and similar matters) with respect to the proposed issuance of the Note from its financial, legal and other advisors (and not us or any of our affiliates) to the extent that the Issuer desired to obtain such advice. DATED this 19th day of June, 2017. BRANCH BANKING AND TRUST COMPANY By: Nam : Andrew G. Smith Title: Senior Vice President Notice Of Sale Printed On: 6/13/2017 2:46:48PM Bond issue name: City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Sale date: 06/19/2017 Closing date: 06/19/2017 Submitted by: rpritchard@broadandcassel.com Submission date: 06/13/2017 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Submit Date: 6/19/2017 Issuer Name of Governmental Unit: City of Edgewater Mailing Address of Governmental Unit or its Manager: 104 North Riverside Drive Address 2: [blank] City: State: Zip Code: Edgewater FL 32132 Counties in which governmental unit has jurisdiction: Volusia Type of Issuer: City Is the Issuer a Community Development District? No Printed On: 6/19/2017 3:25:18PM Bond Information Bond Issue Detail(s): Name of Bond Issue Amount Issued Interest Calculation Yield City of Edgewater, Florida $2,000,000 Capital $2,000,000.00 True Interest Cost Rate 2.4701 Improvement Revenue Note, Series 2017 Amount Authorized: $2,000,000.00 Dated Date: 06/19/2017 Sale Date: 06/19/2017 Delivery Date: 06/19/2017 Legal Authority For Issuance: Other Other Legal Authority for Issuance: Chapter 166, Part II Type Of Issue: Revenue Is this a Private Activity Bond? No Specific Revenue(s) Pledged: Primary: Other Secondary: None Other: Local Government Half -Cent Sales Tax, ch,218-VI Purpose(s) of the Issue: Primary: Other Secondary: None Page 1 of 5 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Submit Date: 6/19/2017 Printed On: 6/19/2017 3:25:18PM Other: Parks and Recreation Is this a Refunding Issue? No Bond Refunding Issue Detail(s): Name of Refundina Issue [blank] Type of sale: Negotiated Private Placement Insurance/Enhancements: No Credit Enhancement Rating(s): Moody's: NR S&P. NR Fitch: N R Other: [blank] Debt Service schedule provided by: Email Optional Redemption Provisions provided by: Email Dated Date Oriqinal Par Value Par Value Refunded Participants Provide the name and address of the Senior Managing Underwriter or Sole Purchaser. Underwriter: Branch Banking and Trust Company Mailing Address of Underwriter: 5130 Parkway Plaza Boulevard Address 2: Building No. 9 City: State: Zip Code: Charlotte NC 28217 Co -Underwriter: None Provide the names and addresses of any attorneys who advised the unit of local government with respect to the bond issue. Bond Counsel: Broad and Cassel Mailing Address of Bond Counsel: 390 North Orange Avenue Address 2: Suite 1400 City: State: Postal Code: Orlando FL 32801 Co -Bond Counsel: None Page 2 of 5 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Submit Date: 6/19/2017 Printed On: 6/19/2017 3:25:18PN Provide the names and addresses of any municipal advisor who advised the unit of local government with respect to the bond issue. Municipal Advisor: FirstSouthwest, a Division of Hilltop Securities, Inc. Mailing Address of Municipal Advisor: 450 South Orange Avenue Address 2: Suite 460 City: State: Zip Code: Orlando FL 32801 Co -Municipal Advisor: None Other Professionals: Issuer's Counsel Mailing Address of Other Professionals: Doran Sims Wolfe & Ciocchetti Address 2: 1020 W. International Speedway Blvd City: State: Zip Code: Daytona Beach FL 32114 Paying Agent: Clerk Of The Issuer Registrar: Clerk Of The Issuer Fees Has any fee, bonus, or gratuity been paid by any underwriter or municipal advisor, in connection with the bond issue, to any person not regularly employed or engaged by such underwriter or advisor? Company Name Fee Paid Service provided or function served [blank] Have any other fees been paid by the unit of local government with respect to the bond issue, including any fee paid to attorneys of municipal advisors? Total Bond Counsel Fees Paid: $0.00 Total Municipal Advisor Fees Paid: $0.00 Other Fees Paid: Page 3 of 5 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Submit Date: 6/19/2017 Printed On: 6/19/2017 3:25:18PM Company Name Fee Paid Service Provided or Function Served Broad and Cassel $15,000.00 Note Counsel First Southwest $15,500.00 Financial Advisor to Issuer Edwards Cohen $5,000.00 Bank Counsel Doran Sims Wolfe & Ciocchetti $1,230.00 Issuer's Counsel Filing of this form has been authorized by the official of the issuer identified below: Name: John McKinney Title: Governmental Officer primarily responsible for coordinating issuance of the bonds Fees charged by Underwriter: Management Fee (per thousand par value): $0.00 OR Private Placement Fee: $0.00 Underwriter's expected gross spread (per thousand par value): $0.00 Respondent For additional information, the Division of Bond Finance should contact: Name: Joseph B. Stanton Title: Partner Phone: 407-839-4210 Company: Broad and Cassel Mailing Address of Respondent: 390 North Orange Avenue Address 2: Suite 1400 City: State: Zip Code: Orlando FL 32801 Page 4 of 5 City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Submit Date: 6/19/2017 Printed On: 6/19/2017 3:25:18PM Information relating to party completing this form (if different from above): Name: [blank] Title: [blank] Phone: [blank] Company: [blank] Mailing Address: [blank] Address 2: [blank] City: State: Zip Code: [blank] [blank] [blank] Continuing Disclosure Is the issuer required to provide continuing disclosure information in accordance with SEC Rule 15C2-127 No Page 5 of 5 Is: C Rachel Pritchard From: Rachel Pritchard Sent: Monday, June 19, 2017 3:26 PM To: 'Williams Sharon' Subject: City of Edgewater, Florida Capital Improvement Revenue Note, Series 2017 Attachments: Specimen Note.pdf Good Afternoon Sharon, The Bond Information Form has been submitted successfully for the above -referenced issue. The Debt Service Schedule and Optional Redemption Provisions are provided in the attached Specimen Note. Please let us know if you have any questions or need any additional information. Thank you. HOME VCARD Rachel Pritchard LEGAL SECRETARY 390 NORTH ORANGE AVENUE SUITE 1400 ORLANDO, FL 32801-4961 ]31zmo ,.,m C ASSEL TELEPHONE: 407.839.4200 AI I. X411,1 A, _AI FACSIMILE: 407.425.8377 DIRECT LINE: 407.481.5214 DIRECT FACSIMILE: 407.425.8377 E-MAIL: RPRITCHARD@BROADANDCASSEL.COM BROAD AND CASSEL LLP www.broadandcassel.com 1 , 't and the Holder may agree � Capi. a iw, erms used iii this Note and not otherWzse de`f�ned;shall have t N f ;; S',`?,?'f.".f`",a}\f,"iL 1. , i Y',i 1\,s J�.rt..x^>> h ,si4.yx =the MP 14 S gzijen to thein tri tha Ag'reemerit f � j 't mss.,, „�s {x • r ><+ =a F k_;- �4,u >.. ��;d !�,ty'. y tg.. ��F t �L�.� m'f'?t;4Yis'a`.. �^t"=3Yc R?c. -,7\. 2'r lvi Ss.t 4 "C: i 3. �:: 1 r \Tt. s o``. >x$�`is r>\ y i'fv .1Y ,o X r a 4 1' F �i rl,F.tfr}µ�s� ?','���+�c 1 n to xi> aF xltp5� This:Note shall bear interest at a fixed rate equal'to 2,47 /o p.er atulttmz(the , 1�Tote Rate ), bzch" hal�:be calculated on the baszs'of a 360 da ear; cassung otwelve`Lt`ath�iG'0) day w X y onths, Subj p" a ct od}ustent xtas pz o�ided h. ( , Yt Y !kat tti4 ^��\i i<< �5Sys A <yYt %�,1>�4}i \tF'�si 55`r n�t?vc \.a`91t@, •_�? ,..,s ��c,t• on?the accurzeiee of ani I�eteimiziatian of Iaability$ this Note shah bear znterest=from Taxably l ate >fhe date when sue; Determination of Taxability is deemed tome occurred at tl� Nate Rate'shall also"be further ad1usted as set,forth 17erezn and in'the A�ry�lyeeeizt Th' Halder Jl 1.: `=. (shall provzde�ta the City such docuzxi rztation to evidence:any adlustrrient to the N®fie Rate and the ?�l ,j .1.',•l .ri <dC�✓zn..i',anE'.Ct�.iJn ,�'�rltd d.:a 'slziill, all•:ustrl.�ent C'q cu a is s %iz y �.. ., ,, t { e . s✓r ? ' h { > '��,� ` � i{Y� js` '\Njor tit � i• �� p y g i s Interest shall be aid semiannuall duan the term of this Note on each Jtirie 1 aid ,> Demrrienczng December 1, 2017, Pz.mczpal shall' be paid aixiivaly on eacli June' 1, 'r�� cbmmenczng:June 1, 2018, as set fortli m Schedule I attached hereto `_ On June 1, 2032, tlxe entire .\ 11S .\ �� l�lgY �. r SY' zV xf, 5 ; unpaid principal and mtei est desciibecl herein shall be dtie and pad able. The an iortizat1, schedule inerts of rzncz al of and interest in the Noie zs "set forth;in ScleduleI attackzed hereta, slid =;<by reference herein, such Schedule I sha11 bo zncoiporated by zoterenc rnto the bady ofthzs Noie _`; 1£xt t-� In addition, the City agrees to pay to; the Holder subJecfito such Iaeterrrzinatzon of Zaxability file Additional Amount upon demand "Additional Amount" deans (i) the dzft`ereuce bareen,(a) yY,' ,�'nterest on flus Nate for the period con=enczng;on the: date on whXch the znterest fith, Note ceasedao be:excludable from gross income,fol federal income tax purposes or the Note eeased,to be a "qualified tax exempt obligatzoi�", as the case ixzay be, slid ending an tlxe earner of the date ;r ty this Note ceased to be outstanding or suchadjuatment is nc longer applicable to this Note (the ' ' "i'= "Taxable Period" ata rate er annum' e ual' o the Taxable Rate and;.'(b) the a� e ate a nount_of rest paidoe r ;the Taxable Period under theproviszons of this Note without inten this Notfo considering the Determination of Taxability; plus (ii) any penalties and interest paid or payable by such Holder to the Internal Revenue Service by reason of such Deterrzination of'T'axability eventt:-s A r [REMAINDER OF PAGE INTENTIONALLY LEF f Mi h';JI"; ":;Cki Clerk/Para e, J. 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BF2003 BOND INFORMATION FORM PART 1. ISSUER INFORMATION 1. NAME OF GOVERNMENTAL UNIT: City of Edgewater, Florida 2. MAILING ADDRESS OF GOVERNMENTAL UNIT OR ITS MANAGER: 104 N. Riverside Drive. Edgewater. Florida 32132 3. COUNTY(IES) IN WHICH GOVERNMENTAL UNIT HAS JURISDICTION: Volusia 4. TYPE OF ISSUER: COUNTY X CITY DEPENDENT SPECIAL DISTRICT INDEPENDENT SPECIAL DISTRICT SCHOOL DISTRICT OTHER SPECIFY OTHER 5. IS THE ISSUER A COMMUNITY DEVELOPMENT DISTRICT? YES X NO PART II. BOND ISSUE INFORMATION 1. NAME OF BOND ISSUE: City of Edgewater, Florida $2,000,000 Capital Improvement Revenue Note, Series 2017 2. AMOUNT ISSUED: $2,000,000 3. AMOUNT AUTHORIZED: $2,000,000 4. BASIS OF INT. RATE CALCULATIONS: ARBITRAGE YIELD NET INTEREST COST RATE x TRUE INTEREST COST RATE _ VARIABLE _ OTHER 5. YIELD: 2.4701% 6 DATED DATE: June 192017 7. SALE DATE: June 19, 2017 8. DELIVERY DATE: June 19, 2017 9. LEGAL AUTHORITY FOR ISSUANCE: FLORIDA STATUTES Chapter 166, Part II SPECIAL ACTS OTHER 10. TYPE OF ISSUE: GENERAL OBLIGATION SPECIAL ASSESSMENT SPECIAL OBLIGATION X REVENUE COP (CERTIFICATE OF PARTICIPATION) LEASE -PURCHASE BANK LOAN/LINE OF CREDIT 11. A. IS THIS A PRIVATE ACTIVITY BOND (PAB)? YES X NO B. 1. IF YES, DID THIS ISSUE RECEIVE A PAB ALLOCATION? YES NO 2. IF YES, AMOUNT OF ALLOCATION: 4825-4262-9450.2 12 SPECIFIC REVENUE(S) PLEDGED: (Choose from the list below) (1) PRIMARY: (2) SECONDARY: (a) Ad Valorem Taxes (b) Annual Appropriation (c) Communications Services Tax (d) 20% Constitutional Gas Tax (e) ConventionfFourist/Resort Tax (f) Direct Pay Letter of Credit (g) Facility/Revenue/User Fees (h) Guaranteed Entitlement (i) Lease Revenue 0) Loan Payments (k) Local Option Gas Tax (1) Local Option Sales Tax (m) Other Excise Taxes (n) Other Shared Revenue (o) Public Service Tax (p) Regulatory Fees & Charges (q) Special Assessment (r) Tax Increment (s) Utility Tax (t) Other (specify on # 3 below) (3) OTHER(S):.Proceeds of the Local Government Half -Cent Sales Tax, as defined and described in, and distributed to the City pursuant to Chapter 218, Part VI, Florida Statutes 13. A. PURPOSE(S) OF THE ISSUE: (Choose from the list below) (1) PRIMARY (dd) Parks and Recreation (2) SECONDARY (a) Administration (i.e. City Hall/Court house (b) Bond Pool/Loans or Grants to local Govt. (c) Retirement/Nursing/Assisted Living (d) Env. Sensitive Land Purchase (e) Hospital Healthcare Facility (f) Mental Health Drug Treatment (g) Operations (i.e. working capital, pension) (h) Water Control/Drainage/Storm water (3) OTHER(S) (i) Airport 0) Corrections Facility (k) Education (1) Electric Utilities (m) Equipment (n) Gas Utilities (o) Industrial/Manufacturing (p) Multi -Family Housing (q) Parking (r) Convention/Civic Center (s) Public Museum, Library (t) Public Safety (u) Recreational Facility (v) Port/Marina (w) Redevelopment (x) Road and Bridge Projects (y) Sewer/Waste Water (z) Refunding (aa) Single Family Housing (bb) Voting System (cc) Water (dd) Other (specify on #3 below) B. IF PURPOSE IS REFUNDING. COMPLETE THE FOLLOWING: (COMPLETE REFUNDING INFO (1) FOR EACH ISSUE REFUNDED LIST: (a) NAME OF ISSUE; (b) DATED DATE; (c) ORIGINAL PAR VALUE (PRINCIPAL AMOUNT) OF ISSUE; (d) AMOUNT OF PAR VALUE (PRINCIPAL AMOUNT) REFUNDED. (2) REFUNDED DEBT HAS BEEN: _ RETIRED OR _ DEFEASED (3) A. DID THE REFUNDING ISSUE CONTAIN NEW MONEY? YES NO B. IF YES, APPROXIMATELY WHAT PERCENTAGE OF PROCEEDS IS NEW MONEY? % 14. TYPE OF SALE: COMPETITIVE BID NEGOTIATED X NEGOTIATED PRIVATE PLACEMENT 15. INSURANCE/ENHANCEMENTS: AGIC AMBAC CGIC CLIC _ HUD —MBIA _ NGM _ LOC (LETTER OF CREDIT) SPECIFY OTHER X NO CREDIT ENHANCEMENT 16. LIST RATING(S) SCORE: _ OTHER SPECIFY OTHER 17. DEBT SERVICE SCHEDULE: MOODY'S FGIC FSA S & P FITCH X NOT RATED ATTACH COMPLETE COPY OF SCHEDULE PROVIDING THE FOLLOWING INFORMATION: (see Specimen Note) MATURITY DATES (MO/DAY/YR): COUPON/INTEREST RATES: ANNUAL INTEREST PAYMENTS: PRINCIPAL (PAR VALUE) PAYMENTS: MANDATORY TERM AMORTIZATION: 18. LIST OR ATTACH OPTIONAL REDEMPTION PROVISIONS: (see Specimen Note) 19. PROVIDE THE NAME AND ADDRESS OF THE SENIOR MANAGING UNDERWRITER OR SOLE PURCHASER. SOLE PURCHASER: Branch Banking and Trust Company 5130 Parkway Plaza Blvd., Building No. 9 Charlotte, North Carolina 28217 20. PROVIDE THE NAME(S) AND ADDRESS(ES) OF ANY ATTORNEY OR FINANCIAL CONSULTANT WHO ADVISED THE UNIT OF LOCAL GOVERNMENT WITH RESPECT TO THE BOND ISSUE. NO BOND COUNSEL _ NO FINANCIAL ADVISOR NO OTHER PROFESSIONALS BOND/NOTE COUNSEL(S): Broad and Cassel 390 N. Orange Avenue, Suite 1400 Orlando, Florida 32801 FINANCIAL ADVISOR(S)/CONSULTANT(S): First Southwest, a division of Hilltop Securities, Inc. 450 S. Orange Avenue, Suite 460 Orlando, FL 32801 OTHER PROFESSIONALS: ISSUER'S COUNSEL: Doran Sims Wolfe & Ciocchetti 1020 W. International Speedway Boulevard Suite 100 Daytona Beach, Florida 32114 21. PAYING AGENT Clerk of the Issuer 22. REGISTRAR Clerk of the Issuer 23. COMMENTS: PART Ill. RESPONDENT INFORMATION FOR ADDITIONAL INFORMATION, THE DIVISION SHOULD CONTACT: Name and Title Joseph B. Stanton Phone 407-839-4210 Company Broad and Cassel INFORMATION RELATING TO PARTY COMPLETING THIS FORM (If different from above): Name and Title Company Date Report Submitted: _ Phone BF2004-A and BF2004-B NOTE: The following items are required to be completed in full for all bond issues except those sold pursuant to Section 154 Part III; Sections 159 Parts II, III or V; or Section 243 Part II, Florida Statutes. 24 25 ANY FEE, BONUS, OR GRATUITY PAID BY ANY UNDERWRITER OR FINANCIAL CONSULTANT, IN CONNECTION WITH THE BOND ISSUE, TO ANY PERSON NOT REGULARLY EMPLOYED OR ENGAGED BY SUCH UNDERWRITER OR CONSULTANT: X NO FEE, BONUS OR GRATUITY PAID BY UNDERWRITER OR FINANCIAL CONSULTANT (1) COMPANY NAME FEE PAID: $ SERVICE PROVIDED or FUNCTION SERVED: (2) COMPANY NAME FEE PAID: $ SERVICE PROVIDED or FUNCTION SERVED: (3) COMPANY NAME FEE PAID: $ SERVICE PROVIDED or FUNCTION SERVED: (4) COMPANY NAME FEE PAID: $ SERVICE PROVIDED or FUNCTION S ANY OTHER FEES PAID BY THE UNIT OF LOCAL GOVERNMENT WITH RESPECT TO THE BOND ISSUE, INCLUDING ANY FEE PAID TO ATTORNEYS OR FINANCIAL CONSULTANTS: NO FEES PAID BY ISSUER (1) COMPANY NAME Broad and Cassel FEE PAID: $15,000.00 SERVICE PROVIDED or FUNCTION SERVED: Note Counsel (2) COMPANY NAME First Southwest FEE PAID: $15,500.00 SERVICE PROVIDED or FUNCTION SERVED: Financial Advisor to Issuer (3) COMPANY NAME Edwards Cohen FEE PAID: $ 5,000.00 SERVICE PROVIDED or FUNCTION SERVED: Bank Counsel (4) COMPANY NAME Doran Sims Wolfe & Ciocchetti FEE PAID: $ 1,230.00 SERVICE PROVIDED or FUNCTION SERVED: Issuer's Counsel (UNLESS YOU ARE EXEMPT FROM FILING A BF2004),PLEASE PROVIDE THE SIGNATURE OF EITHER THE CHIEF EXECUTIVE OFFICER OF THE GOVERNING BODY OF THE UNIT OF LOCAL GOVERNMENT OR THE GOVERNMENTAL OFFICER PRIMARILY RESPONSIBLE FOR COORDINATING THE ISSUANCE OF THE BONDS: NAME (Typed/Printed): John McKinney SIGNATUR TITLE: Assistant City Manager DATE: June 19, 2017 BF2004-B ITEMS 26 AND 27 MUST BE COMPLETED FOR ALL BONDS SOLD BY NEGOTIATED SALE 26. MANAGEMENT FEE CHARGED BY UNDERWRITER: $ PER THOUSAND PAR VALUE. 161Z 11101 -119:8»-01O ,rWk1� X NO MANAGEMENT FEE OR PRIVATE PLACEMENT FEE 27. UNDERWRITER'S EXPECTED GROSS SPREAD: X NO GROSS SPREAD PART IV. CONTINUING DISCLOSURE INFORMATION PER THOUSAND PAR VALUE. In order to better serve local governments, the Division of Bond Finance will remind issuers as their deadlines approach for fling continuing disclosure information required by SEC Rule 15c2-12, based on the following information: 28. Is the issuer required to provide continuing disclosure information in accordance with SEC Rule 15c2-12? Yes X No 29. If yes, on what date is the continuing disclosure information required to be filed? 30. Provide the following information regarding the person(s) responsible for filing continuing disclosure information required by SEC Rule 15d2-12 and the continuing disclosure agreement (including other obligated parties, if appropriate). Name: Title: Mailing Address: Telephone Number: FAX Number: E-mail address (if e-mail notification is requested): PART V. RETURN THIS FORM AND THE FINAL OFFICIAL STATEMENT, IF ONE WAS PREPARED, TO: Courier Deliveries: Division of Bond Finance State Board of Administration 1801 Hermitage Blvd., Suite 200 Tallahassee, FL 32308 Phone: 850/413-1304 or 413-1305 FAX: 850/413-1315 Mailing Address: Division of Bond Finance State Board of Administration P. O. Drawer 13300 Tallahassee, FL 32317-3300 REVISED Dec. 9, 2002 / bfcombo lw FirstSouthwest A Division of Hilltop Securities_ Marls P. Galvin Director Date: June 13, 2017 (Closing Date; June 19, 2017) To: Distribution List Memorandum Subject: City of Edgewater, Florida $2,000,000.00 Capital Improvement Revenue Note, Series 2017 This memorandum will outline information for the closing of the $2,000,000.00 Capital Improvement Revenue Note, Series 2017 (the "Series 2017 Note) and summarizes the money transfers necessary for closing. Unless otherwise noted, all funds will be delivered in Federal Funds. I. PRE-CLOSING Date: Thursday, June 15, 2017 Time: Immediately following the Special Meeting Place: City of Edgewater 104 N. Riverside Drive Edgewater, FL 32132 John McKinney, Finance Director (386) 424-2400 ext. 1202 II. CLOSING Date: Monday, June 19, 2017 III. DELIVERY AND AUTHENTICATION OF THE NOTE Broad & Cassel ("Bond Counsel") will prepare one Series 2017 Note in the aggregate principal amount of $2,000,000.00 registered in the name of Branch Banking and Trust Company (the "Bank"). The Series 2017 Note shall bear interest at a fixed rate of 2.47% per annum. Hilltop Securities Inc. direct 407.426.9611 450 South Orange Ave fax 407.426.7835 Suite 460 mark.galvin@hilltopsecurities.com Orlando, Florida 32801 HilltopSecurities.com IV. SOURCES AND USES OF FUNDS V. Sources: Bond Proceeds: Par Amount 2,000,000.00 2,000,000.00 Uses: Project Fund Deposits: Project Fund 2,000,000.00 2,000,000.00 SETTLEMENTS FROM THE BANK The Note Proceeds transfer from the Bank is as follows: Par Amount $ 2,000,000.00 Total Transfer Amount S 2,000,000.00 The Note Proceeds will be applied as follows: Project Fund $ 2,000,000.00 Total Transfer Amount S 2,000,000 00 On the morning of June 19, 2017 and after all note documents have been executed, the Bank will wire transfer $2,000,000.00 of funds to the City for deposit to the Project Fund. Wire instructions are below. 1. To the City for the Project Fund Amount: Receiving Bank Name Receiving Bank ABA Number: Beneficiary Acct Number: Beneficiary Name: Beneficiary Physical Address 2 $2,000,000.00 SunTrust Bank, N.A. 303 Peachtree Street, NE Atlanta, GA 30308 061000104 1000156134867 City of Edgewater Operating Account 104 N. Riverside Drive Edgewater, FL 32131 VI. RECEIPT OF FUNDS AND CLOSING Upon confirmation of the receipt of the wire transfer and the execution, and delivery of all closing documents and legal opinions, Bond Counsel shall contact the City and release the Series 2017 Note to the Bank and the financing will then be closed. VII. POST -CLOSING Upon successful closing, the City will disburse funds to pay issuance costs associated with the issuance and delivery of the Series 2017 Note. Approved and Accepted by: City of Edgewater, Florida John PcKinney, Finan e Director