HomeMy WebLinkAboutVI (A) Resolution No. 99-04, Authorizing the Issuance of Capital Improvement Refunding Revenue Bonds, Series 1999 Agenda 1-19-99
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"CENTER OF GOOD LIVING-PRIDE OF WEST ORANGE' MAYOR•COMMISSIONER
S. SCOT) VANDERGRIFT
Ocoee COMMISSIONERS
o` CITY OF OCOEE DANNYHOWELL
O SCO'El ANDERSON
a 150 N. LAKESHORE DRIVE SCOTT A.GLASS
444...iii °COTE, FLORIDA 34761-2258 NANCY 1.PARKER
(407)656-2322
CITY MANAGER
rf4 OF,0000 ELLIS SHAPIRO
MEMORANDUM
TO: The Honorable Mayor and City Commissioners
FROM: Wanda Horton, Finance Director/v
DATE: January 13, 1999
RE: Resolution 99-04 Capital Improvement Refunding Revenue Bonds, Series
1999
Staff presented a method to finance certain capital improvement projects which was
subsequently approved by the Commission at the December 1, 1998 commission meeting.
These projects were identified as:
Municipal Pool and Bathhouse $1,100,000
Public Works Complex Improvements $1,200,000
Fire Station $1,000,000
Police Department $1,000,000
Park Land $ 500,000
Total $4,800,000
Mayor Vandergrift, Commissioners Anderson and Howell, the City Manager, City
Attorney, staff and members of the financing team made presentations to rating agencies in
New York The group presented the City's economic condition, financial policy, and
management philosophy which resulted in the following ratings for this issue:
* Fitch A
• Moody's A3
* Standard and Poor's A
Among the strengths cited by the agencies were solid growth of sales tax receipts, healthy
coverage of maximum annual debt service, a growing local economy and increasing
population base, strong financial position with increasing fund balances, adequate
planning for the eventual slowdown of growth, and limited future debt issuance planned in
conjunction with a manageable capital plan.
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Resolution 99-04 authorizes the issuance of City of Ocoee, Florida, Capital Improvement
Refunding Revenue Bonds, Series 1999 not to exceed $12,000,000. These bonds provide
for:
• Paying the costs of acquiring and constructing certain capital improvements
within the City (as detailed above)
• Refunding the outstanding principal amount of the City's Capital Improvement
Revenue Bonds, Series 1991
• Refinancing the outstanding principal amount of the City's Capital
Improvement Revenue Promissory Note, Series 1996
J, • Acquiring a surety bond in an amount equal to the reserve Requirement for the
Series 1999 Bonds
• Paying the costs of issuance of the Series 1999 Bonds, including premium on the
Municipal Bond Insurance Policy
• Authorizing certain officials and employees of the City to take all actions
required in connection with the sale, issuance and delivery of the Series 1999
Bonds
• Appointing Financial Security Assurance Inc. as Bond Insurer, and
• Pledging Half Cent Sales Tax Revenues as security
The financing method presented by the financing team and approved by the Commission
on December 1, 1998 will restructure the 1991 Capital Improvement Bond Issue and the
1996 Capital Improvement Promissory Note which will generate new funds for the
attainment of the projects listed above while maintaining the current level of debt service
payments that the City is currently making.
ACTION REQUESTED
Staff requests that the Mayor and City Commission approve Resolution 99-04 authorizing
the issuance of City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1999
and those items detailed above, authorize the Mayor, City Clerk and staff as indicated in
the resolution to execute any and all documents required, and authorize the underwriters
(SunTrust Equitable Securities and William R. Hough & Co.) to market the bonds and
present a purchase contract to the City Commission at the special meeting to be held on
January 28, 1999.
RESOLUTION NO. 99-04
A RESOLUTION AUTHORIZING THE ISSUANCE BY THE CITY OF
OCOEE, FLORIDA OF NOT TO EXCEED $12,000,000 IN AGGREGATE
PRINCIPAL AMOUNT OF CITY OF OCOEE, FLORIDA CAPITAL
IMPROVEMENT REFUNDING REVENUE BONDS, SERIES 1999 FOR THE
PURPOSE OF PAYING THE COSTS OF ACQUIRING AND
CONSTRUCTING CERTAIN CAPITAL IMPROVEMENTS WITHIN THE
CITY AND REFUNDING CERTAIN INDEBTEDNESS INCURRED BY THE
CITY; PLEDGING SALES TAX REVENUES TO SECURE PAYMENT OF
THE PRINCIPAL OF AND INTEREST ON SUCH BONDS; MAKING
CERTAIN COVENANTS AND AGREEMENTS FOR THE BENEFIT OF THE
HOLDERS OF SUCH BONDS; AUTHORIZING CERTAIN OFFICIALS AND
EMPLOYEES OF THE CITY TO TAKE ALL ACTIONS REQUIRED IN
CONNECTION WITH THE SALE, ISSUANCE AND DELIVERY OF THE
SERIES 1999 BONDS; APPOINTING AN INSURER FOR THE SERIES 1999
BONDS TO PROVIDE BOND INSURANCE AND A RESERVE ACCOUNT
SURETY; PROVIDING CERTAIN OTHER MATTERS IN CONNECTION
THEREWITH; AND PROVIDING AN EFFECTIVE DATE.
TABLE OF CONTENTS
Page No.
ARTICLE IGENERAL
SECTION 1.01. Definitions 1
SECTION 1.02. Authority for Resolution 6
SECTION 1.03. Resolution to Constitute Contract 6
SECTION 1.04. Findings 7
SECTION 1.05. Initial Project 7
ARTICLE IIAUTHORIZATION, TERMS, EXECUTIONAND REGISTRATION OF BONDS
SECTION 2.01. Authorization of Bonds 8
SECTION 2.02. Authorization and Description of Series 1999 Bonds 8
SECTION 2.03. Application of Series 1999 Bond Proceeds; Transfer of Proceeds of
Series 1996 Note 9
SECTION 2.04. Execution of Bonds 10
SECTION 2.05. Authentication 10
SECTION 2.06. Temporary Bonds 10
SECTION 2.07. Bonds Mutilated, Destroyed, Stolen or Lost 11
SECTION 2.08. Transfer 11
SECTION 2.09. Coupon Bonds 12
SECTION 2.10. Book Entry. 13
SECTION 2.11. Form of Bonds 14
ARTICLE IIIREDEMPTION OF BONDS
SECTION 3.01. Privilege of Redemption 21
SECTION 3.02. Selection of Bonds to be Redeemed 21
SECTION 3.03. Notice of Redemption 21
SECTION 3.04. Redemption of Portions of Bonds 22
SECTION 3.05. Payment of Redeemed Bonds 22
ARTICLE IVSECURITY, SPECIAL FUNDS ANDAPPLICATION THEREOF
SECTION 4.01. Bonds not to be Indebtedness of Issuer 23
SECTION 4.02. Security for Bonds 23
SECTION 4.03. Construction Fund 23
SECTION 4.04. Funds and Accounts 23
SECTION 4.05. Flow of Funds 24
SECTION 4.06. Investments 28
SECTION 4.07. Separate Accounts 28
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ARTICLE VSUBORDINATED INDEBTEDNESS,ADDITIONAL BONDS, COVENANTS OF
ISSUER, BOND INSURANCE
SECTION 5.01. Subordinated Indebtedness 29
SECTION 5.02. Issuance of Additional Bonds 29
SECTION 5.03. Bond Anticipation Notes 30
SECTION 5.04. Books and Records 30
SECTION 5.05. Annual Audit 30
SECTION 5.06. No Impairment 30
SECTION 5.07. Collection of Sales Tax Revenues 30
SECTION 5.08. Federal Income Tax Covenants; Taxable Bonds 31
SECTION 5.09. Appointment of Insurer and Supplemental Provisions Regarding Insurer
for Series 1999 Bonds 31
SECTION 5.10. Provisions Relating to Reserve Account Insurance Policy 35
ARTICLE VIDEFAULTS AND REMEDIES
SECTION 6.01. Events of Default 37
SECTION 6.02. Remedies 37
SECTION 6.03. Directions to Trustee as to Remedial Proceedings 38
SECTION 6.04. Remedies Cumulative 38
SECTION 6.05. Waiver of Default 38
SECTION 6.06. Application of Moneys After Default 38
ARTICLE VIISUPPLEMENTAL RESOLUTIONS
SECTION 7.01. Supplemental Resolutions Without Bondholders' Consent 40
SECTION 7.02. Supplemental Resolutions with Bondholders' Consent 40
SECTION 7.03. Supplemental Resolutions with Insurer's Consent in lieu of Bondholders'
Consent 42
ARTICLE VIIIMISCELLANEOUS
SECTION 8.01. Defeasance 43
SECTION 8.02. Sale of Bonds 44
SECTION 8.03. General Authority 44
SECTION 8.04. No Third Party Beneficiaries 44
SECTION 8.05. No Personal Liability 44
SECTION 8.06. Severability of Invalid Provisions 45
SECTION 8.07. Repeal of Inconsistent Resolutions 45
SECTION 8.08. Effective Date 45
EXHIBIT A - INITIAL PROJECT DESCRIPTION
EXHIBIT B - PERMITTED INVESTMENTS
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[Remainder of page intentionally left blank]
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BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE CITY,
FLORIDA:
ARTICLE 1
GENERAL
SECTION 1.01. Definitions. When used in this Resolution, the following terms shall
have the following meanings, unless the context clearly otherwise requires:
"Act" shall mean Chapter 166, Part II, and Chapter 218, Part VI, Florida Statutes, as
amended, the Constitution of the State of Florida, the City Charter of the Issuer, and other
applicable provisions of law.
"Additional Bonds" shall mean the obligations issued at any time under the provisions of
Section 5.02 hereof on a parity with the Series 1999 Bonds.
"Additional Project" shall mean the acquisition, construction or reconstruction of capital
improvements and shall include all property rights, easements, franchises and equipment relating
thereto and deemed necessary or convenient for the construction or acquisition or the operation
thereof which are financed in whole or in part with the proceeds of Additional Bonds.
"Amortization Installment" shall mean an amount designated as such by Supplemental
Resolution of the Issuer and established with respect to any Term Bonds.
"Annual Debt Service" shall mean, with respect to any Fiscal Year, the aggregate amount
of(1)all interest required to be paid on the Outstanding Bonds during such Fiscal Year,except to
the extent that such interest is to be paid from deposits in the Construction Fund or the Interest
Account made from Bond proceeds, (2) all principal of Outstanding Serial Bonds maturing in
such Fiscal Year, and (3) all Amortization Installments herein designated with respect to such
Fiscal Year.
"Authorized Issuer Officer" shall mean any person authorized by resolution of the Issuer
to perform such act or sign such document.
"Bond Amortization Account" shall mean the separate account in the Debt Service Fund
established pursuant to Section 4.04 hereof
"Bond Counsel" shall mean any attorney at law or firm of attorneys, of nationally
recognized standing in matters pertaining to the exclusion from gross income for federal income
tax purposes of interest on obligations issued by states and political subdivisions, and duly
admitted to practice law before the highest court of any state of the United States of America.
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"Bond Year" shall mean the period commencing on the day after principal on the Bonds
is due and ending on the date the following year which is the day principal on the Bonds is due.
"Bondholder" or "Holder" or "holder" or any similar term, when used with reference to a
Bond or Bonds, shall mean any person who shall be the registered owner of any Outstanding
Bond or Bonds as provided in the registration books of the Issuer.
"Bonds" shall mean the Series 1999 Bonds, together with any Additional Bonds issued
pursuant to this Resolution.
"Clerk" shall mean the City Clerk of the Issuer, or such other person as may be duly
authorized by the Issuer to act on his or her behalf.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the regulations
and rules thereunder in effect or proposed.
"Construction Fund" shall mean the City of Ocoee, Florida, Capital Improvement
Revenue Bonds Construction Fund established pursuant to Section 4.03 hereof.
"Cost" when used in connection with a Project, shall mean (1) the Issuer's cost of
physical construction; (2) costs of acquisition by or for the Issuer of such Project; (3) costs of
land and interests therein and the costs of the Issuer incidental to such acquisition; (4) the cost of
any indemnity and surety bonds and premiums for insurance during construction; (5) all interest
due to be paid on the Bonds and other obligations relating to the Project during the construction
period of such Project and for a reasonable period thereafter; (6) engineering, legal and other
consultant fees and expenses; (7) costs and expenses incidental to the issuance of the Bonds for
up to one year, including the fees and expenses of any auditors, Paying Agent, Registrar or
depository; (8) payments, when due (whether at the maturity of principal or the due date of
interest or upon redemption) on any indebtedness of the Issuer (other than the Bonds) incurred
for such Project; (9) costs of machinery or equipment required by the Issuer for the
commencement of operation of such Project; or (10) any other costs properly attributable to such
construction or acquisition, as determined by generally accepted accounting principles and shall
include reimbursement to the Issuer for any such items of Cost heretofore paid by the Issuer.
Any Supplemental Resolution may provide for additional items to be included in the aforesaid
Costs.
"Debt Service Fund" shall mean the City of Ocoee, Florida, Capital Improvement
Revenue Bonds Debt Service Fund established pursuant to Section 4.04 hereof
"Federal Securities" shall mean direct obligations of(including obligations issued or held
in book entry form on the books of) the Department of Treasury of the United States of America
and obligations fully and unconditionally guaranteed as to timely payment by the United States
of America, provided, that the full faith and credit of the United States of America must be
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pledged to any such direct obligation or guarantee and that no such obligation shall permit
redemption prior to maturity at the option of the obligor.
"Fiscal Year" shall mean the period commencing on October 1 of each year and
continuing through the next succeeding September 30, or such other period as may be prescribed
by law.
"Initial Project" shall mean the capital improvements specifically set forth on Exhibit A,
including, without limitation, all property rights, appurtenances, easements, franchises and
equipment relating thereto and deemed necessary or convenient for the acquisition, construction,
erection thereof, in accordance with certain plans on file or to be on file with the Clerk, with such
changes, substitutions, deletions, additions or modifications to the enumerated improvements,
equipment and facilities,or such other improvements as approved by the City Commission of the
Issuer in a Supplemental Resolution in accordance with the Act.
"Insurance Policy" shall mean the insurance policy issued by the Insurer guaranteeing the
scheduled payment of principal of and interest on the Bonds when due.
"Insurer" shall mean Financial Security Assurance, Inc., a New York stock insurance
company, or any successor thereto or assignee thereof.
"Interest Account" shall mean the separate account in the Debt Service Fund established
pursuant to Section 4.04 hereof.
"Interest Date" shall be such date or dates for the payment of interest on a Series of Bonds
as shall be provided by Supplemental Resolution.
"Issuer" or"City" shall mean the City of Ocoee, Florida.
"Maximum Annual Debt Service" shall mean the largest amount of Annual Debt Service
for any Fiscal Year in which Bonds shall be Outstanding, excluding all Fiscal Years which shall
have ended prior to the Fiscal Year in which Maximum Annual Debt Service shall be computed.
"Maximum Interest Rate" shall mean, with respect to any particular Variable Rate Bonds,
a numerical rate of interest, which shall be set forth in the Supplemental Resolution of the Issuer
delineating the details of such Bonds, that shall be the maximum rate of interest such Bonds may
at any time bear in the future in accordance with the terms of such Supplemental Resolution.
"Mayor" shall mean the Mayor of the Issuer, or in his or her absence, the Vice Mayor of
the Issuer, or such other person as may be duly authorized by the Mayor to act on his or her
behalf.
"Outstanding" when used with reference to Bonds and as of any particular date, shall
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describe all Bonds theretofore and thereupon being authenticated and delivered except, (1) any
Bond in lieu of which another Bond or other Bonds have been issued under an agreement to
replace lost, mutilated or destroyed Bonds, (2) any Bond surrendered by the Holder thereof in
exchange for another Bond or other Bonds under Sections 2.06 and 2.08 hereof, and (3) Bonds
canceled after purchase in the open market or because of payment at or redemption prior to
maturity.
"Paying Agent" shall mean any paying agent for Bonds appointed by or pursuant to a
Supplemental Resolution and its successors or assigns, and any other Person which may at any
time be substituted in its place pursuant to this Resolution.
"Permitted Investments" shall mean only investments authorized pursuant to the laws of
the State, as described on Exhibit B hereto.
"Person" shall mean an individual, a corporation, a partnership, an association, a joint
stock company, a trust, any unincorporated organization or governmental entity.
"Pledged Funds" shall mean (1) the Sales Tax Revenues, and (2) until applied in
accordance with the provisions of this Resolution, all moneys, including the investments thereof,
in the funds and accounts established hereunder, with the exception of the Unrestricted Revenue
Account.
"Principal Account" shall mean the separate account in the Debt Service Fund established
pursuant to Section 4.04 hereof.
"Project" shall mean the Initial Project and any Additional Project.
"Redemption Price" shall mean, with respect to any Bond or portion thereof, the principal
amount or portion thereof, plus the applicable premium, if any, payable upon redemption thereof
pursuant to such Bond or this Resolution.
"Refunded Bonds" shall mean the remaining outstanding principal amount of the Series
1991 Bonds and the Series 1996 Note.
"Registrar" shall mean any registrar for the Bonds appointed by or pursuant to a
Supplemental Resolution and its successors and assigns, and any other Person which may at any
time be substituted in its place pursuant to Supplemental Resolution.
"Reserve Account" shall mean the separate account in the Debt Service Fund established
pursuant to Section 4.04 hereof.
"Reserve Policy" shall mean, with respect to the Series 1999 Bonds, the Reserve Account
Policy issued by the Insurer, in lieu of a cash deposit, that satisfies the Reserve Account
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Requirement following the issuance of the Series 1999 Bonds.
"Reserve Account Requirement" shall mean, as of any date of calculation, an amount
equal to the lesser of(1) Maximum Annual Debt Service for all Outstanding Bonds, (2) 125% of
the average annual debt service for all Outstanding Bonds, or (3) the maximum amount allowed
under the Code in order to maintain the exclusion of interest on the Outstanding Bonds (other
than Taxable Bonds). In computing the Reserve Account Requirement in respect of any Bonds
that constitute Variable Rate Bonds, the interest rate on such Bonds shall be assumed to be the
greater of(a) 110% of the daily average interest rate on such Variable Rate Bonds during the 12
months ending with the month preceding the date of calculation, or such shorter period of time
that such Bonds shall have been Outstanding, or (b) the actual rate of interest borne by the
Variable Rate Bonds on such date of calculation.
"Resolution" shall mean this Resolution, as the same may from time to time be amended,
modified or supplemented by Supplemental Resolution.
"Restricted Revenue Account" shall mean the separate account in the Revenue Fund
established pursuant to Section 4.04 hereof.
"Revenue Fund" shall mean the City of Ocoee, Florida Capital Improvement Revenue
Bonds Revenue Fund established pursuant to Section 4.04 hereof.
"Sales Tax Revenues" shall mean all of the legally available 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.
"Serial Bonds" shall mean all of the Bonds other than the Term Bonds.
"Series" shall mean all the Bonds delivered on original issuance in a simultaneous
transaction and identified pursuant to Sections 2.01 and 2.02 hereof or a Supplemental
Resolution authorizing the issuance by the Issuer of such Bonds as a separate Series, regardless
of variations in maturity, interest rate, Amortization Installments or other provisions.
"Series 1991 Bonds" shall mean the Issuer's Capital Improvement Revenue Bonds, Series
1991, issued in the original principal amount of$2,580,000.
"Series 1996 Note" shall mean the Issuer's Capital Improvement Revenue Promissory
Note, Series 1996, issued in the original principal amount of$4,840,000.
"Series 1999 Bonds" shall mean the Issuer's Capital Improvement Refunding Revenue
Bonds, Series 1999 authorized pursuant to Section 2.02 hereof.
"State" shall mean the State of Florida.
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"Subordinated Indebtedness" shall mean that indebtedness of the Issuer, subordinate and
junior to the Bonds, issued in accordance with the provisions of Section 5.01 hereof
"Supplemental Resolution" shall mean any resolution of the Issuer amending or
supplementing this Resolution adopted and becoming effective in accordance with the terms of
Sections 7.01,7.02 and 7.03 hereof.
"Taxable Bond" shall mean any Bond which states, in the body thereof, that the interest
income thereon is includable in the gross income of the Holder thereof for federal income tax
purposes or that such interest is subject to federal income taxation.
"Term Bonds" shall mean those Bonds which shall be designated as Term Bonds hereby
or by Supplemental Resolution of the Issuer and which are subject to mandatory redemption by
Amortization Installments.
"Unrestricted Revenue Account" shall mean the separate account in the Revenue Fund
established pursuant to Section 4.04 hereof.
"Variable Rate Bonds" shall mean Bonds issued with a variable, adjustable, convertible
or other similar rate which is not fixed in percentage for the entire term thereof at the date of
issue.
The terms "herein," "hereunder," "hereby," "hereto," "hereof' and any similar terms, shall
refer to this Resolution; the term heretofore shall mean before the date of adoption of this
Resolution; and the term "hereafter" shall mean after the date of adoption of this Resolution.
Words importing the masculine gender include every other gender.
Words importing the singular number include the plural number,and vice versa.
SECTION 1.02. Authority for Resolution. This Resolution is adopted pursuant to the
provisions of the Act.
SECTION 1.03. Resolution to Constitute Contract. In consideration of the purchase and
acceptance of any or all of the Bonds by those who shall hold the same from time to time, the
provisions of this Resolution shall be a part of the contract of the Issuer with the Holders of the
Bonds and shall be deemed to be and shall constitute a contract between the Issuer and the
Holders from time to time of the Bonds. The pledge made in this Resolution and the provisions,
covenants and agreements herein set forth to be performed by or on behalf of the Issuer shall be
for the equal benefit, protection and security of the Holders of any and all of said Bonds. All of
the Bonds, regardless of the time or times of their issuance or maturity, shall be of equal rank
without preference, priority or distinction of any of the Bonds over any other thereof except as
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expressly provided in or pursuant to this Resolution.
SECTION 1.04. Findings. It is hereby ascertained, determined and declared:
(A) That the Issuer deems it necessary, desirable and in the best interests of the Issuer
and its citizens that the Initial Project be acquired, constructed and erected and that the Refunded
Bonds be refunded.
(B) That the Initial Project and the refunding of the Refunded Bonds shall be financed
with the proceeds of the Series 1999 Bonds, together with certain other legally available funds of
the
Issuer.
(C) That in order to preserve and protect the public health, safety and welfare of the
inhabitants of the Issuer, it is necessary and desirable to acquire, design and construct the Initial
Project.
(D) That the Issuer deems it necessary, beneficial and in its best interest to provide for
the refunding of the Refunded Bonds. Such refunding will be advantageous to the Issuer by
revising the terms and covenants previously made for the benefit of the holders of the Refunded
Bonds and by providing interest cost savings to the Issuer,
(E) That, prior to the issuance of the Series 1999 Bonds, the Sales Tax Revenues will not
be pledged or encumbered in any manner.
(F) That the estimated Pledged Funds will be sufficient to pay the principal of and
interest on the Series 1999 Bonds, as the same become due, and all other payments provided for
in this Resolution.
(G) That the principal of and interest on the Bonds and all other payments provided for
in this Resolution will be paid solely from the Pledged Funds; and the ad valorem taxing power
of the Issuer will never be necessary or authorized to pay the principal of and interest on the
Bonds and, except as otherwise provided herein, the Bonds shall not constitute a lien upon any
property of the Issuer.
(H) That the Issuer adopted this Resolution after a public hearing preceded by at least
seven (7) days notice of the hearing and the proposed action by publication in a newspaper of
general circulation in the City in accordance with the requirements of the City Charter of the
Issuer.
SECTION 1.05. Initial Project. The Issuer does hereby authorize the acquisition,
construction and erection of the Initial Project in accordance with Exhibit "A" attached hereto
and made a part hereof.
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[End of Article I]
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ARTICLE II
AUTHORIZATION, TERMS, EXECUTION
AND REGISTRATION OF BONDS
SECTION 2.01. Authorization of Bonds. This Resolution creates an issue of Bonds of
the Issuer to be designated as "City of Ocoee, Florida Capital Improvement Revenue Bonds"
which may be issued in one or more Series as hereinafter provided. The aggregate principal
amount of the Bonds which may be executed and delivered under this Resolution is not limited
except as is or may hereafter be provided in this Resolution or as limited by the Act or by law.
The Bonds may, if and when authorized by the Issuer pursuant to this Resolution, be
issued in one or more Series, with such further appropriate particular designations added to or
incorporated in such title for the Bonds of any particular Series as the Issuer may determine and
as may be necessary to distinguish such Bonds from the Bonds of any other Series. Each Bond
shall bear upon its face the designation so determined for the Series to which it belongs.
The Bonds shall be issued for such purpose or purposes; shall bear interest at such rate or
rates not exceeding the maximum rate permitted by law; and shall be payable in lawful money of
the United States of America on such dates; all as determined by Supplemental Resolution of the
Issuer.
The Bonds shall be issued in denominations of $5,000 or integral multiples thereof, in
such form,whether coupon or registered; shall be dated such date; shall bear such numbers; shall
be payable at such place or places; shall contain such redemption provisions; shall have such
Paying Agents and Registrars; shall mature in such years and amounts; shall provide that the
proceeds thereof be used in such manner; all as determined by Supplemental Resolution of the
Issuer.
SECTION 2.02. Authorization and Description of Series 1999 Bonds. A Series of Bonds
entitled to the benefit, protection and security of this Resolution is hereby authorized in an
aggregate principal amount of not to exceed $12,000,000 for the principal purposes of acquiring
and constructing the Initial Project, refunding the Refunded Bonds, paying the premiums
associated with the issuance of the Insurance Policy and the Reserve Account Policy, and paying
certain costs of issuance incurred with respect to such Series. Such Series shall be designated as,
and shall be distinguished from the Bonds of all other Series by the title "City of Ocoee, Florida,
Capital Improvement Refunding Revenue Bonds, Series 1999," provided the Issuer may change
such designation in the event that the total authorized amount of Series 1999 Bonds are not
issued in a simultaneous transaction or the Series 1999 Bonds are not issued in calendar year
1999.
The Series 1999 Bonds shall be dated as of the first day of the month in which occurs the
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delivery of the Series 1999 Bonds to the purchaser or purchasers thereof or such other date as
may be set forth by Supplemental Resolution of the Issuer; shall be issued as fully registered
Bonds; shall be numbered consecutively from one upward in order of maturity preceded by the
letter "R"; shall be in such denominations and shall bear interest at a rate or rates not exceeding
the maximum rate allowed by Florida law, payable in such manner and on such dates; shall
consist of such amounts of Serial Bonds, Term Bonds and Variable Rate Bonds; maturing in
such amounts or installments and in such years not exceeding forty (40) years from their date;
shall be payable in such place or places; shall have such Paying Agents and Registrars; and shall
contain such redemption provisions; all as the Issuer shall provide hereafter by Supplemental
Resolution.
The principal of or Redemption Price, if applicable, on the Series 1999 Bonds are payable
upon presentation and surrender of the Series 1999 Bonds at the designated office of the Paying
Agent. Interest payable on any Series 1999 Bond on any Interest Date will be paid by check or
draft of the Paying Agent to the Holder in whose name such Bond shall be registered at the close
of business on the date which shall be the fifteenth day (whether or not a business day) of the
calendar month next preceding such Interest Date, or, unless otherwise provided by
Supplemental Resolution, at the option of the Paying Agent, and at the request and expense of
such Holder, by bank wire transfer for the account of such Holder. In the event the interest
payable on any Series 1999 Bond is not punctually paid or duly provided for by the Issuer on
such Interest Date, such defaulted interest will be paid to the Holder in whose name such Bond
shall be registered at the close of business on a special record date for the payment of such
defaulted interest as established by notice to such Holder, not less than ten days preceding such
special record date. All payments of principal of or Redemption Price, if applicable, and interest
on the Series 1999 Bonds shall be payable 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.
SECTION 2.03. Application of Series 1999 Bond Proceeds; Transfer of Proceeds of
Series 1996 Note. Except as otherwise provided by Supplemental Resolution, the proceeds
derived from the sale of the Series 1999 Bonds, including accrued interest and premium, if any,
shall, simultaneously with the delivery of the Series 1999 Bonds to the purchaser or purchasers
thereof, be applied by the Issuer as follows:
(A) Accrued interest shall be deposited in the Interest Account and shall be used only for
the purpose of paying the interest which shall thereafter become due on the Series 1999 Bonds.
(B) A sufficient amount of the Series 1999 Bond proceeds shall be applied to the payment
of costs and expenses relating to the issuance of the Series 1999 Bonds which must be paid upon
delivery of the Series 1999 Bonds, including the premium for the Insurance Policy, the premium
for the Reserve Account Policy, and legal fees and expenses. Such amount may, at the option of
the Issuer, be deposited in and disbursed from the Construction Fund.
(C) A sum sufficient,together with the investment earnings thereon, to pay the remaining
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principal, interest and redemption premium, if any, of the Series 1991 Bonds shall be deposited
in an irrevocable escrow account established for the holders of the Series 1991 Bonds, and held
as cash or invested in Federal Securities.
(D) A sum sufficient to pay the remaining principal of and interest on the Series 1996
Note shall be transferred to the holder of the Series 1996 Note.
(E) The balance of the Series 1999 Bond proceeds shall be deposited in the Construction
Fund.
The balance of the proceeds in the approximate amount of$1,650,900 which are in the
project fund created with respect to the Series 1996 Note shall be transferred to be held pursuant
to this Resolution and used for the projects authorized pursuant to the resolutions which the
Series 1996 Note were issued.
SECTION 2.04. Execution of Bonds. The Bonds shall be executed in the name of the
Issuer with the manual or facsimile signature of the Mayor and the official seal of the Issuer shall
be imprinted thereon, attested and countersigned with the manual or facsimile signature of the
Clerk. In case any one or more of the officers who shall have signed or sealed any of the Bonds
or whose facsimile signature shall appear thereon shall cease to be such officer of the Issuer
before the Bonds so signed and sealed have been actually sold and delivered, such Bonds may
nevertheless be sold and delivered as herein provided and may be issued as if the person who
signed or sealed such Bonds had not ceased to hold such office. Any Bond may be signed and
sealed on behalf of the Issuer by such person who at the actual time of the execution of such
Bond shall hold the proper office of the Issuer, although, at the date of such Bond, such person
may not have held such office or may not have been so authorized. The Issuer may adopt and
use for such purposes the facsimile signatures of any such persons who shall have held such
offices at any time after the date of the adoption of this Resolution,notwithstanding that either or
both shall have ceased to hold such office at the time the Bonds shall be actually sold and
delivered.
SECTION 2.05. Authentication. No Bond of any Series shall be secured hereunder or be
entitled to the benefit hereof or shall be valid or obligatory for any purpose unless there shall be
manually endorsed on such Bond a certificate of authentication by the Registrar or such other
entity as may be approved by the Issuer for such purpose. Such certificate on any Bond shall be
conclusive evidence that such Bond has been duly authenticated and delivered under this
Resolution. The form of such certificate shall be substantially in the form provided in Section
2.11 hereof
SECTION 2.06. Temporary Bonds. Until the definitive Bonds of any Series are
prepared, the Issuer may execute, in the same manner as is provided in Section 2.04 hereof, and
deliver, upon authentication by the Registrar pursuant to Section 2.05 hereof, in lieu of definitive
Bonds, but subject to the same provisions, limitations and conditions as the definitive Bonds,
11
except as to the denominations thereof, one or more temporary Bonds substantially of the tenor
of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued, in
denominations authorized by the Issuer by subsequent Resolution, and with such omissions,
insertions and variations as may be appropriate to temporary Bonds. The Issuer, at its own
expense, shall prepare and execute definitive Bonds, which shall be authenticated by the
Registrar. Upon the surrender of such temporary Bonds for exchange, the Registrar, without
charge to the Holder thereof, shall deliver in exchange therefor definitive Bonds, of the same
aggregate principal amount and Series and maturity as the temporary Bonds surrendered. Until
so exchanged, the temporary Bonds shall in all respects be entitled to the same benefits and
security as definitive Bonds issued pursuant to this Resolution. All temporary Bonds
surrendered in exchange for another temporary Bond or Bonds or for a definitive Bond or Bonds
shall be forthwith canceled by the Registrar.
SECTION 2.07. Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall
become mutilated, or be destroyed, stolen or lost, the Issuer may, in its discretion, issue and
deliver, and the Registrar shall authenticate, a new Bond of like tenor as the Bond so mutilated,
destroyed, stolen or lost, in exchange and substitution for such mutilated Bond upon surrender
and cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed,
stolen or lost, and upon the Holder furnishing the Issuer and the Registrar proof of such Holder's
ownership thereof and satisfactory indemnity and complying with such other reasonable
regulations and conditions as the Issuer or the Registrar may prescribe and paying such expenses
as the Issuer and the Registrar may incur. All Bonds so surrendered or otherwise substituted
shall be canceled by the Registrar. If any of the Bonds shall have matured or be about to mature,
instead of issuing a substitute Bond, the Issuer may pay the same or cause the Bond to be paid,
upon being indemnified as aforesaid, and if such Bonds be lost, stolen or destroyed, without
surrender thereof.
Any such duplicate Bonds issued pursuant to this Section 2.07 shall constitute original,
additional contractual obligations on the part of the Issuer whether or not the lost, stolen or
destroyed Bond be at any time found by anyone, and such duplicate Bond shall be entitled to
equal and proportionate benefits and rights as to lien on the Pledged Funds to the same extent as
all other Bonds issued hereunder.
SECTION 2.08. Transfer. Bonds, upon surrender thereof at the office of the Registrar
with a written instrument of transfer satisfactory to the Registrar, duly executed by the Holder
thereof or such Holder's attorney duly authorized in writing, may, at the option of the Holder
thereof, be exchanged for an equal aggregate principal amount of registered Bonds of the same
Series and maturity of any other authorized denominations.
The Bonds issued under this Resolution shall be and have all the qualities and incidents
of negotiable instruments under the law merchant and the Uniform Commercial Code of the
State, subject to the provisions for registration and transfer contained in this Resolution and in
the Bonds. So long as any of the Bonds shall remain Outstanding, the Issuer shall maintain and
12
keep, at the office of the Registrar, books for the registration and transfer of the Bonds.
Each Bond shall be transferable only upon the books of the Issuer, at the office of the
Registrar, under such reasonable regulations as the Issuer may prescribe, by the Holder thereof in
person or by such Holder's attorney duly authorized in writing upon surrender thereof together
with a written instrument of transfer satisfactory to the Registrar duly executed and guaranteed
by the Holder or such Holder's duly authorized attorney. Upon the transfer of any such Bond, the
Issuer shall issue, and cause to be authenticated, in the name of the transferee a new Bond or
Bonds of the same aggregate principal amount and Series and maturity as the surrendered Bond.
The Issuer, the Registrar and any Paying Agent or fiduciary of the Issuer may deem and treat the
Person in whose name any Outstanding Bond shall be registered upon the books of the Issuer as
the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of
receiving payment of, or on account of, the principal or Redemption Price, if applicable, and
interest on such Bond and for all other purposes, and all such payments so made to any such
Holder or upon such Holder's order shall be valid and effectual to satisfy and discharge the
liability upon such Bond to the extent of the sum or sums so paid and neither the Issuer nor the
Registrar nor any Paying Agent or other fiduciary of the Issuer shall be affected by any notice to
the contrary.
The Registrar, in any case where it is not also the Paying Agent in respect to any Series of
Bonds, forthwith (A) following the fifteenth day prior to an Interest Date for such Series; (B)
following the fifteenth day next preceding the date of first mailing of notice of redemption of any
Bonds of such Series; and (C) at any other time as reasonably requested by the Paying Agent of
such Series, shall certify and furnish to such Paying Agent the names, addresses and holdings of
Bondholders and any other relevant information reflected in the registration books. Any Paying
Agent of any fully registered Bond shall effect payment of interest on such Bonds by mailing a
check or draft to the Holder entitled thereto or may, in lieu thereof, upon the request and at the
expense of such Holder, transmit such payment by bank wire transfer for the account of such
Holder.
In all cases in which the privilege of exchanging Bonds or transferring Bonds is
exercised, the Issuer shall execute and the Registrar shall authenticate and deliver such Bonds in
accordance with the provisions of this Resolution. Execution of Bonds by the Mayor, the Clerk
and the City Attorney for purposes of exchanging, replacing or transferring Bonds may occur at
the time of the original delivery of the Series of which such Bonds are a part. All Bonds
surrendered in any such exchanges or transfers shall be held by the Registrar in safekeeping until
directed by the Issuer to be canceled by the Registrar. For every such exchange or transfer of
Bonds, the Issuer or the Registrar may make a charge sufficient to reimburse it for any tax, fee,
expense or other governmental charge required to be paid with respect to such exchange or
transfer. The Issuer and the Registrar shall not be obligated to make any such exchange or
transfer of Bonds of any Series during the fifteen days next preceding an Interest Date on the
Bonds of such Series (other than Variable Rate Bonds), or, in the case of any proposed
redemption of Bonds of such Series, then during the fifteen days next preceding the date of the
13
first mailing of notice of such redemption and continuing until such redemption date.
SECTION 2.09. Coupon Bonds. The Issuer, at its discretion, may by Supplemental
Resolution authorize the issuance of coupon Bonds, registrable as to principal only or as to both
principal and interest. Such Supplemental Resolution shall provide for the negotiability, transfer,
interchangeability, denominations and form of such Bonds and coupons appertaining thereto.
Coupon Bonds (other than Taxable Bonds) shall only be issued if an opinion of Bond Counsel is
received to the effect that issuance of such coupon Bonds will not adversely affect the exclusion
from gross income of interest earned on such Bonds for federal income tax purposes.
SECTION 2.10. Book Entry. The Series 1999 Bonds shall be initially issued in the form
of a separate single certificated fully registered Series 1999 Bond for each of the maturities of the
Series 1999 Bonds. Upon initial issuance, the ownership of each such Series 1999 Bond shall be
registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee
of The Depository Trust Company ("DTC"). As long as the Series 1999 Bonds shall be
registered in the name of Cede & Co., all payments of principal on the Series 1999 Bonds shall
be made by the Paying Agent by check or draft or by bank wire transfer to Cede & Co., as
Holder of the Series 1999 Bonds.
With respect to Series 1999 Bonds registered in the registration books kept by the
Registrar in the name of Cede & Co., as nominee of DTC, the Issuer, the Registrar and the
Paying Agent shall have no responsibility or obligation to any participant in the DTC book-entry
program (a "Participant") or to any indirect participant. Without limiting the immediately
preceding sentence, the Issuer, the Registrar and the Paying Agent shall have no responsibility or
obligation with respect to (A)the accuracy of the records of DTC, Cede & Co. or any Participant
with respect to any ownership interest in the Series 1999 Bonds, (B) the delivery to any
Participant or any other Person other than a Series 1999 Bondholder, as shown in the registration
books kept by the Bond Registrar, of any notice with respect to the Series 1999 Bonds, including
any notice of redemption, or (C)the payment to any participant or any other Person, other than a
Series 1999 Bondholder, as shown in the registration books kept by the Registrar, of any amount
with respect to principal, interest or redemption premium, if any, of the Series 1999 Bonds. The
Issuer,the Registrar and the Paying Agent may treat and consider the Person in whose name each
Bond is registered in the registration books kept by the Registrar as the Holder and absolute
owner of such Series 1999 Bond for the purpose of payment of principal, interest or redemption
premium, if any, with respect to such Series 1999 Bond, for the purpose of giving notices of
redemption and other matters with respect to such Series 1999 Bond, for the purpose of
registering transfers with respect to such Series 1999 Bond, and for all other purposes
whatsoever. The Paying Agent shall pay all principal, interest or redemption premium, if any, of
the Series 1999 Bonds only to or upon the order of the respective Holders, as shown in the
registration books kept by the Registrar, or their respective attorneys duly authorized in writing,
as provided herein and all such payments shall be valid and effective to fully satisfy and
discharge the Issuers obligations with respect to payment of principal, interest or redemption
14
premium, if any, of the Series 1999 Bonds to the extent of the sum or sums so paid. No Person
other than a Holder, as shown in the registration books kept by the Registrar, shall receive a
redemption premium, if any, pursuant to the provisions hereof. Upon delivery by DTC to the
Issuer of written notice to the effect that DTC has determined to substitute a new nominee in
place of Cede & Co., and subject to the provisions herein with respect to transfers during the
fifteen (15) days next preceding a payment date or mailing of notice of redemption, the words
"Cede & Co." in the Resolution shall refer to such new nominee of DTC; and upon receipt of
such notice, the Issuer shall promptly deliver a copy of the same to the Registrar and the Paying
Agent.
Upon (A) receipt by the Issuer of written notice from DTC (i) to the effect that a
continuation of the requirement that all of the Outstanding Series 1999 Bonds be registered in the
registration books kept by the Registrar in the name of Cede & Co., as nominee of DTC, is not in
the best interest of the beneficial owners of the Series 1999 Bonds or(ii) to the effect that DTC is
unable or unwilling to discharge its responsibilities and no substitute depository willing to
undertake the functions of DTC hereunder can be found which is willing and able to undertake
such functions upon reasonable and customary terms, or (B) determination by the Issuer that
such book-entry only system is burdensome to the Issuer, the Series 1999 Bonds shall no longer
be restricted to being registered in the registration books kept by the Registrar in the name of
Cede & Co., as nominee of DTC,but may be registered in whatever name or names Holders shall
designate, in accordance with the provisions hereof. In such event, the Issuer shall issue and the
Registrar shall authenticate, transfer and exchange Series 1999 Bonds consistent with the terms
hereof, in denominations of$5,000 or any integral multiple thereof to the Holders thereof. The
foregoing notwithstanding, until such time as participation in the book-entry only system is
discontinued, the provisions set forth in the Letter of Representation executed by the Issuer and
the Registrar and delivered to DTC in order to induce DTC to act as securities depository for the
Series 1999 Bonds shall apply to the payment of principal, interest and redemption premium, if
any, on the Series 1999 Bonds.
SECTION 2.11. Form of Bonds. The text of the Bonds, except as otherwise provided
pursuant to Section 2.09 hereof, the form of which shall be provided by Supplemental Resolution
of the Issuer, shall be in substantially the following form with such omissions, insertions and
variations as may be necessary and/or desirable and approved by the Mayor and the Clerk prior
to the issuance thereof(which necessity and/or desirability and approval shall be presumed by
the Issuer's delivery of the Bonds to the purchaser or purchasers thereof):
[Remainder of page intentionally left blank]
15
No. R- $
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF OCOEE, FLORIDA
CAPITAL IMPROVEMENT REFUNDING REVENUE BOND
SERIES 1999
Interest Maturity Date of
Rate Date Original Issue CUSIP
0/0
Registered Holder:
Principal Amount:
KNOW ALL MEN BY THESE PRESENTS, that the City of Ocoee, Florida, a
municipality created and existing under and by virtue of the laws of the State of Florida (the
"Issuer"), for value received, hereby promises to pay, solely from the Pledged Funds hereinafter
described, to the Registered Holder identified above, or registered assigns as hereinafter
provided, on the Maturity Date identified above, the Principal Amount identified above and
interest on such Principal Amount from the Date of Original Issue identified above or from the
most recent interest payment date to which interest has been paid at the Interest Rate per annum
identified above on April 1 and October 1 of each year commencing April 1, 1999 until such
Principal Amount shall have been paid, except as the provisions hereinafter set forth with respect
to redemption prior to maturity may be or become applicable hereto.
Such Principal Amount and interest and the premium, if any, on this Bond are payable in
any coin or currency of the United States of America which, on the respective dates of payment
thereof, shall be legal tender for the payment of public and private debts. Such Principal Amount
and the premium, if any, on this Bond, are payable, upon presentation and surrender hereof, at
the designated corporate trust office of SunTrust Bank, Central Florida, National Association,
Orlando, Florida, as Paying Agent. Payment of each installment of interest shall be made to the
person in whose name this Bond shall be registered on the registration books of the Issuer
maintained by SunTrust Bank, Central Florida, National Association, Orlando, Florida, as
Registrar, at the close of business on the date which shall be the fifteenth day (whether or not a
business day) of the calendar month next preceding each interest payment date and shall be paid
by a check or draft of such Paying Agent mailed to such Registered Holder at the address
appearing on such registration books or, at the option of such Paying Agent, and at the request
and expense of such Registered Holder, by bank wire transfer for the account of such Holder. In
16
the event interest payable on this Bond is not punctually paid or duly provided for by the Issuer
on such interest payment date, payment of each installment of such defaulted interest shall be
made to the person in whose name this Bond shall be registered at the close of business on a
special record date for the payment of such defaulted interest as established by notice to such
Registered Holder, not less than ten days preceding such special record date.
This Bond is one of an authorized issue of Bonds in the aggregate principal amount of
$ (the "Bonds") of like date, tenor and effect, except as to maturity date, interest rate,
denomination and number, issued for the purpose of
under the
authority of and in full compliance with the Constitution and laws of the State of Florida,
particularly Chapter 166, Part II, and Chapter 218, Part VI, Florida Statutes, as amended, the City
Charter of the Issuer, and other applicable provisions of law (the "Act"), and a resolution duly
adopted by the City Commission of the Issuer on January 18, 1999, as may be amended and/or
supplemented (the "Resolution"), and is subject to the terms and conditions of the Resolution.
The Bonds and the interest thereon are payable solely from and secured by a lien upon
and a pledge of(1) the legally available 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 (2) until applied in accordance with the provisions of the Resolution,
all moneys, including investments thereof, in certain of the funds and accounts established by the
Resolution, all in the manner and to the extent described in the Resolution (collectively, the
"Pledged Funds"). It is expressly agreed by the Registered Holder of this Bond that the full faith
and credit of the Issuer, the State of Florida, or any political subdivision thereof, are not pledged
to the payment of the principal, premium, if any, and interest on this Bond and that such Holder
shall never have the right to require or compel the exercise of any taxing power of the Issuer, the
State of Florida, or any political subdivision thereof, to the payment of such principal, premium,
if any, and interest. This Bond and the obligation evidenced hereby shall not constitute a lien
upon any property of the Issuer, but shall constitute a lien only on, and shall be payable solely
from, the Pledged Funds.
Neither the members of the City Commission of the Issuer nor any person executing this
Bond shall be liable personally hereon or be subject to any personal liability or accountability by
reason of the issuance hereof.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
BOND SET FORTH ON THE REVERSE SIDE HEREOF AND SUCH FURTHER
PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET
FORTH IN THIS PLACE.
This Bond shall not be valid or become obligatory for any purpose until the Certificate of
Authentication hereon shall have been signed by the Registrar.
17
IN WITNESS WHEREOF, the City of Ocoee, Florida has issued this Bond and has
caused the same to be executed by the manual or facsimile signature of the Mayor, attested and
countersigned by the manual or facsimile signature of its City Clerk, and its official seal or a
facsimile thereof to be affixed or reproduced hereon, all as of the_day of , 1999.
CITY OF OCOEE, FLORIDA
(SEAL)
By:
Mayor
ATTESTED AND COUNTERSIGNED:
City Clerk
[Provisions on Reverse Side of Bond]
This Bond is transferable in accordance with the terms of the Resolution only upon the
books of the Issuer kept for that purpose at the designated corporate trust office of the Registrar
by the Registered Holder hereof in person or by such Holder's attorney duly authorized in
writing, upon the surrender of this Bond together with a written instrument of transfer
satisfactory to the Registrar duly executed by the Registered Holder or such Holder's attorney
duly authorized in writing, and thereupon a new Bond or Bonds in the same aggregate principal
amount shall be issued to the transferee in exchange therefor, and upon the payment of the
charges, if any, therein prescribed. The Bonds are issuable in the form of fully registered Bonds
in the denominations of $5,000 and integral multiples thereof, not exceeding the aggregate
principal amount of the Bonds maturing on the same date. The Issuer, the Registrar and any
Paying Agent may treat the Registered Holder of this Bond as the absolute owner hereof for all
purposes, whether or not this Bond shall be overdue, and shall not be affected by any notice to
the contrary. The Issuer and the Registrar shall not be obligated to make any exchange or
transfer of the Bonds during the fifteen days next preceding an interest payment date, or in the
case of any proposed redemption of the Bonds, then, during the fifteen days next preceding the
date of the first mailing of notice of such redemption.
]INSERT REDEMPTION PROVISIONS]
Notice of redemption, unless waived, is to be given by the Registrar by mailing an
official redemption notice by registered or certified mail at least 30 days and not more than 45
days prior to the date fixed for redemption to the Registered Holders of the Bonds to be
redeemed at such Holders' addresses shown on the registration books maintained by the Registrar
18
or at such other addresses as shall be furnished in writing by such Registered Holders to the
Registrar. Provided, however, that no defect in any such notice to any Registered Holder of
Bonds to be redeemed nor failure to give such notice to any such Registered Holder nor failure of
any such Registered Holder to receive such notice shall in any manner defeat the effectiveness of
a call for redemption as to all other Registered Holders of Bonds to be redeemed. Notice of
redemption having been given as aforesaid, the Bonds or portions of Bonds to be redeemed shall,
on the redemption date, become due and payable at the redemption price therein specified, and
from and after such date (unless the Issuer shall default in the payment of the redemption price),
such Bonds or portions of Bonds shall cease to bear interest.
It is hereby certified and recited that all acts, conditions and things required to exist, to
happen and to be performed precedent to and in the issuance of this Bond, exist, have happened
and have been performed, in regular and due form and time as required by the laws and
Constitution of the State of Florida applicable thereto, and that the issuance of the Bonds does
not violate any constitutional or statutory limitations or provisions.
[Remainder of page intentionally left blank]
19
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
Insert Social Security or Other
Identifying Number of Assignee
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
as attorneys to register the transfer of the said Bond on the books kept for registration thereof
with full power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: Signature(s) must be
guaranteed by a member firm of
the New York Stock Exchange or
a commercial bank or trust
company.
enlargement or any change whatever and the Social
Security or other identifying number of such
assignee must be supplied.
20
The following abbreviations, when used in the inscription on the face of the within Bond,
shall be construed as though they were written out in full according to applicable laws or
regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of
survivorship and not as tenants in common
UNIF TRANS MIN ACT--
(Cust.)
Custodian for
under Uniform Transfer to Minors Act of
(State)
Additional abbreviations may also be used though not in the list above.
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the issue described in the within-mentioned Resolution.
DATE OF AUTHENTICATION:
Registrar
By:
Authorized Officer
[End of Article II]
21
ARTICLE III
REDEMPTION OF BONDS
SECTION 3.01. Privilege of Redemption. The terms of this Article III shall apply to
redemption of Bonds other than Variable Rate Bonds. The terms and provisions relating to
redemption of Variable Rate Bonds shall be provided by Supplemental Resolution.
SECTION 3.02. Selection of Bonds to be Redeemed. The Bonds shall be redeemed only
in the principal amount of$5,000 each and integral multiples thereof The Issuer shall, at least
sixty (60) days prior to the redemption date (unless a shorter time period shall be satisfactory to
the Registrar) notify the Registrar of such redemption date and of the principal amount of Bonds
to be redeemed. For purposes of any redemption of less than all of the Outstanding Bonds of a
single maturity, the particular Bonds or portions of Bonds to be redeemed shall be selected not
more than forty-five (45) days prior to the redemption date by the Registrar from the
Outstanding Bonds of the maturity or maturities designated by the Issuer by such method as the
Registrar shall deem fair and appropriate and which may provide for the selection for redemption
of Bonds or portions of Bonds in principal amounts of$5,000 and integral multiples thereof.
If less than all of the Outstanding Bonds of a single maturity are to be redeemed, the
Registrar shall promptly notify the Issuer and Paying Agent (if the Registrar is not the Paying
Agent for such Bonds) in writing of the Bonds or portions of Bonds selected for redemption and,
in the case of any Bond selected for partial redemption, the principal amount thereof to be
redeemed.
SECTION 3.03. Notice of Redemption. Unless waived by any Holder of Bonds to be
redeemed, notice of any redemption made pursuant to this section shall be given by the Registrar
on behalf of the Issuer by mailing a copy of an official redemption notice by registered or
certified mail at least thirty (30) days and not more than forty-five (45) days prior to the date
fixed for redemption to each Holder of Bonds to be redeemed at the address of such Holder
shown on the registration books maintained by the Registrar or at such other address as shall be
furnished in writing by such Holder to the Registrar; provided, however, that no defect in any
notice given pursuant to this Section to any Holder of Bonds to be redeemed nor failure to give
such notice shall in any manner defeat the effectiveness of a call for redemption as to all other
Holders of Bonds to be redeemed.
Every official notice of redemption shall be dated and shall state:
(1) the redemption date,
(2) the Redemption Price,
22
(3) if less than all Outstanding Bonds are to be redeemed, the number (and, in the case of
a partial redemption of any Bond, the principal amount) of each Bond to be redeemed,
(4) that, on the redemption date, the Redemption Price will become due and payable upon
each such Bond or portion thereof called for redemption, and that interest thereon shall cease to
accrue from and after said date, and
(5) that such Bonds to be redeemed, whether as a whole or in part, are to be surrendered
for payment of the Redemption Price, plus accrued interest, at the designated office of the
Registrar.
Prior to any redemption date, the Issuer shall deposit with the Registrar an amount of
money sufficient to pay the Redemption Price, plus accrued interest, of all the Bonds or portions
of Bonds which are to be redeemed on that date.
SECTION 3.04. Redemption of Portions of Bonds. Any Bond which is to be redeemed
only in part shall be surrendered at any place of payment specified in the notice of redemption
(with due endorsement by, or written instrument of transfer in form satisfactory to, the Registrar
duly executed by, the Holder thereof or such Holder's attorney duly authorized in writing) and
the Issuer shall execute and the Registrar shall authenticate and deliver to the Holder of such
Bond, without service charge, a new Bond or Bonds, of the same interest rate and maturity, and
of any authorized denomination as requested by such Holder, in an aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the Bonds so
surrendered.
SECTION 3.05. Payment of Redeemed Bonds. Notice of redemption having been given
substantially as aforesaid, the Bonds or portions of Bonds so to be redeemed shall, on the
redemption date, become due and payable at the Redemption Price therein specified, and from
and after such date (unless the Issuer shall default in the payment of the Redemption Price) such
Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for
redemption in accordance with said notice, such Bonds shall be paid by the Registrar and/or
Paying Agent at the appropriate Redemption Price, plus accrued interest. All Bonds which have
been redeemed shall be canceled by the Registrar and shall not be reissued.
[End of Article III]
23
ARTICLE IV
SECURITY, SPECIAL FUNDS AND
APPLICATION THEREOF
SECTION 4.01. Bonds not to be Indebtedness of Issuer. THE BONDS SHALL NOT
BE OR CONSTITUTE GENERAL OBLIGATIONS OR INDEBTEDNESS OF THE ISSUER
AS "BONDS" WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY
PROVISION, BUT SHALL BE SPECIAL OBLIGATIONS OF THE ISSUER, PAYABLE
SOLELY FROM AND SECURED BY A LIEN UPON AND PLEDGE OF THE PLEDGED
FUNDS. NO HOLDER OF ANY BOND SHALL EVER HAVE THE RIGHT TO COMPEL
THE EXERCISE OF ANY AD VALOREM TAXING POWER TO PAY SUCH BOND, OR BE
ENTITLED TO PAYMENT OF SUCH BOND FROM ANY MONEYS OF THE ISSUER
EXCEPT FROM THE PLEDGED FUNDS IN THE MANNER PROVIDED HEREIN.
The Pledged Funds shall immediately be subject to the lien of this pledge without any
physical delivery thereof or further act, and the lien of this pledge shall be valid and binding as
against all parties having claims of any kind in tort,contract or otherwise against the Issuer.
SECTION 4.02. Security for Bonds. The payment of the principal of or Redemption
Price, if applicable, and interest on the Bonds shall be secured forthwith equally and ratably by a
pledge of and lien upon the Pledged Funds. The Issuer does hereby irrevocably pledge the
Pledged Funds to the payment of the principal of or Redemption Price, if applicable, and interest
on the Bonds in accordance with the provisions hereof.
SECTION 4.03. Construction Fund. The Issuer covenants and agrees to establish a
separate fund in a bank or trust company in the State, which is eligible under the laws of such
State to receive funds of the Issuer, to be known as the "City of Ocoee Capital Improvement
Revenue Bonds Construction Fund," which shall be used only for payment of the Cost of the
Project. The Issuer shall maintain in the Construction Fund separate accounts for each Series of
Bonds, and separate accounts therein for capitalized interest funded from the proceeds of any
Series of Bonds. Moneys in the Construction Fund, until applied in payment of any item of the
Cost of a Project in accordance with the provisions hereof, shall be held in trust by the Issuer and
shall be subject to a lien and charge in favor of the Holders of the Bonds and for the further
security of such Holders.
SECTION 4.04. Funds and Accounts. The Issuer covenants and agrees to establish with
a bank or trust company in the State, which is eligible under the laws of the State to receive funds
of the Issuer, separate funds to be known as the "City of Ocoee Capital Improvement Revenue
Bonds Revenue Fund" (the "Revenue Fund") and the "City of Ocoee Capital Improvement
Revenue Bonds Debt Service Fund" (the "Debt Service Fund"). The Issuer shall maintain in the
Revenue Fund two accounts: the "Restricted Revenue Account" and the "Unrestricted Revenue
24
Account." The Issuer shall maintain in the Debt Service Fund four accounts: the "Interest
Account," the "Principal Account,' the "Bond Amortization Account," and the "Reserve
Account." Moneys in the aforementioned funds and accounts, other than the Unrestricted
Revenue Account, until applied in accordance with the provisions hereof, shall be subject to a
lien and charge in favor of the Holders and for the further security of the Holders.
The Issuer shall at any time and from time to time appoint one or more depositories to
hold, for the benefit of the Bondholders, any one or more of the funds and accounts established
hereby. Such depository or depositories shall perform at the direction of the Issuer the duties of
the Issuer in depositing, transferring and disbursing moneys to and from each of such funds and
accounts as herein set forth, and all records of such depositary in performing such duties shall be
open at all reasonable times to inspection by the Issuer and its agents and employees. Any such
depositary shall be a bank or trust company duly authorized to exercise corporate trust powers
and subject to examination by federal or state authority, of good standing, and having a
combined capital, surplus and undivided profits aggregating not less than ten million dollars
($10,000,000).
SECTION 4.05. Flow of Funds.
(A) The Issuer shall deposit the Sales Tax Revenues into the Restricted Revenue Account
promptly upon receipt thereof. The moneys in the Restricted Revenue Account shall be
deposited or credited on or before the last day of each month, commencing with the month in
which delivery of the initial Series of the Bonds shall be made to the purchaser or purchasers
thereof, or such later date as hereinafter provided, in the following manner and in the following
order of priority:
(I) Interest Account. The Issuer shall deposit into or credit to the Interest
Account the sum which, together with the balance in said Account, shall equal the interest
on all Outstanding Bonds accrued and unpaid and to accrue to the end of the then current
calendar month. Moneys in the Interest Account shall be used to pay interest on the
Bonds as and when the same become due, whether by redemption or otherwise, and for
no other purpose. The Issuer shall adjust the amount of the deposit into the Interest
Account not later than the month immediately preceding any Interest Date so as to
provide sufficient moneys in the Interest Account to pay the interest on the Bonds coming
due on such Interest Date.
(2) Principal Account. Next, the Issuer shall deposit into or credit to the Principal
Account the sum which, together with the balance in said Account, shall equal the
principal amounts on all Outstanding Bonds due and unpaid and that portion of the
principal next due which would have accrued on said Bonds during the then current
calendar month if such principal amounts were deemed to accrue monthly (assuming that
a year consists of twelve equivalent calendar months of thirty days each) in equal
amounts from the next preceding principal payment due date, or, if there is no such
25
preceding principal payment due date, from a date one year preceding the due date of
such principal amount. Moneys in the Principal Account shall be used to pay the
principal of the Bonds as and when the same shall mature, and for no other purpose. The
Issuer shall adjust the amount of deposit to the Principal Account not later than the month
immediately preceding any principal payment date so as to provide sufficient moneys in
the Principal Account to pay the principal on Bonds becoming due on such principal
payment date.
(3) Bond Amortization Account. Commencing in the month which is one year
prior to any Amortization Installment due date, the Issuer shall deposit into or credit to
the Bond Amortization Account the sum which, together with the balance in said
Account, shall equal the Amortization Installments on all Bonds Outstanding due and
unpaid and that portion of the Amortization Installments of all Bonds Outstanding next
due which would have accrued on such Bonds during the then current calendar month if
such Amortization Installments were deemed to accrue monthly (assuming that a year
consists of twelve equivalent calendar months having thirty days each) in equal amounts
from the next preceding Amortization Installment due date, or, if there is no such
preceding Amortization Installment due date, from a date one year preceding the due date
of such Amortization Installment. Moneys in the Bond Amortization Account shall be
used to purchase or redeem Term Bonds in the manner herein provided, and for no other
purpose. The Issuer shall adjust the amount of the deposit into the Bond Amortization
Account not later than the month immediately preceding any date for payment of an
Amortization Installment so as to provide sufficient moneys in the Bond Amortization
Account to pay the Amortization Installments on the Bonds coming due on such date.
Payments to the Bond Amortization Account shall be on a parity with payments to the
Principal Account.
Amounts accumulated in the Bond Amortization Account with respect to any
Amortization Installment (together with amounts accumulated in the Interest Account
with respect to interest, if any, on the Term Bonds for which such Amortization Install-
ment was established) may be applied by the Issuer, on or prior to the sixtieth day
preceding the due date of such Amortization Installment (a) to the purchase of Term
Bonds of the Series and maturity for which such Amortization Installment was
established, at a price not greater than the Redemption Price at which such Term Bonds
may be redeemed on the first date thereafter on which such Term Bonds shall be subject
to redemption, or(b) to the redemption at the applicable Redemption Price of such Term
Bonds, if then redeemable by their terms. The applicable Redemption Price (or principal
amount of maturing Term Bonds) of any Term Bonds so purchased or redeemed shall be
deemed to constitute part of the Bond Amortization Account until such Amortization
Installment date, for the purposes of calculating the amount of such Account. As soon as
practicable after the sixtieth day preceding the due date of any such Amortization
Installment, the Issuer shall proceed to call for redemption on such due date, by causing
notice to be given as provided in Section 3.03 hereof, Term Bonds of the Series and
26
maturity for which such Amortization Installment was established (except in the case of
Term Bonds maturing on an Amortization Installment date) in such amount as shall be
necessary to complete the retirement of the unsatisfied balance of such Amortization
Installment. The Issuer shall pay out of the Bond Amortization Account and the Interest
Account to the appropriate Paying Agents, on or before the day preceding such
redemption date (or maturity date), the amount required for the redemption (or for the
payment of such Term Bonds then maturing), and such amount shall be applied by such
Paying Agents to such redemption (or payment). All expenses in connection with the
purchase or redemption of Term Bonds shall be paid by the Issuer from the Revenue
Fund.
(4) Reserve Account. Next, the Issuer shall deposit into or credit to the Reserve
Account a sum sufficient to maintain therein an amount equal to the Reserve Account
Requirement. Moneys in the Reserve Account shall be used only for the purpose of the
payment of maturing principal of or interest or Amortization Installments when the other
moneys in the Debt Service Fund are insufficient therefor, and for no other purpose.
However, whenever the moneys on deposit in the Reserve Account exceed the Reserve
Account Requirement, such excess shall be withdrawn and deposited into the Interest
Account.
Upon the issuance of any Additional Bonds under the terms, limitations and
conditions as herein provided, the Issuer shall, on the date of delivery of such Additional
Bonds, increase the sum required to be accumulated and maintained on deposit in the
Reserve Account to be at least equal to the Reserve Account Requirement on all
Outstanding Bonds including the Additional Bonds then issued. Such required sum may
be paid in full or in part from the proceeds of such Additional Bonds. Unless provided
otherwise in a Supplemental Resolution adopted prior to the issuance of the Additional
Bonds, such required sum may be accumulated in equal monthly payments to the Reserve
Account over a period of months from the date of issuance of the Additional Bonds,
which shall not exceed the greater of (a) twenty-four (24) months, or (b) the number of
months for which interest on such Additional Bonds has been capitalized, as determined
by Supplemental Resolution. In the event moneys in the Reserve Account are accumu-
lated as provided above, (i)the amount in said Reserve Account on the date of delivery of
the Additional Bonds shall not be less than the Reserve Account Requirement on all
Bonds Outstanding (excluding the Additional Bonds) on such date, and (ii) the
incremental difference between the Reserve Account Requirement on all Bonds
Outstanding (excluding the Additional Bonds) on the date of delivery of the Additional
Bonds and the Reserve Account Requirement on all such Bonds and the Additional
Bonds shall be fifty percent(50%)funded upon delivery of the Additional Bonds.
Notwithstanding the foregoing provisions, in lieu of the required cash deposits
into the Reserve Account, the Issuer may, at any time, cause to be deposited into the
Reserve Account a surety bond, irrevocable letter of credit, guaranty or an insurance
27
policy for the benefit of the Bondholders in an amount equal to the difference between
the Reserve Account Requirement and the sums then on deposit in the Reserve Account,
if any. Such surety bond, irrevocable letter of credit, guaranty or insurance policy shall
be payable to the Paying Agent (upon the giving of notice as required thereunder) on any
Interest Date on which a deficiency exists which cannot be cured by funds in any other
fund or account held pursuant to this Resolution and available for such purpose. The
issuer providing such surety bond, irrevocable letter of credit, guaranty or insurance
policy shall either be (a) an insurer (i) whose municipal bond insurance policies insuring
the payment, when due, of the principal of and interest on municipal bond issues results
in such issues being rated in one of the two highest rating categories (without regard to
gradations, such as "plus" or "minus" of such categories) by either Standard & Poor's
Rating Services or Moody's Investors Service, or (ii) who holds one of the two highest
policyholder ratings accorded insurers by A.M. Best & Company, or any comparable
service, or (b) a commercial bank, insurance company or other financial institution the
bonds payable or guaranteed by which have been assigned a rating by either Moody's
Investors Service or Standard & Poor's Rating Services in one of the two highest rating
categories (without regard to gradations, such as "plus" or "minus" of such categories). If
a disbursement is made from a surety bond, irrevocable letter of credit, guaranty or an
insurance policy provided pursuant to this paragraph, the Issuer shall reinstate the
maximum limits of such surety bond, irrevocable letter of credit, guaranty or insurance
policy immediately following such disbursement, or deposit into the Reserve Account,
from moneys available hereunder, funds in the amount of the disbursement made under
such investment, or a combination of such alternatives.
Whenever the amount in the Reserve Account, together with the other amounts in
the Debt Service Fund, are sufficient to fully pay all Outstanding Bonds in accordance
with their terms (including principal or applicable Redemption Price and interest there-
on), the funds on deposit in the Reserve Account may be transferred to the other accounts
of the Debt Service Fund for the payment of the Bonds.
(5) Unrestricted Revenue Account. The balance of any moneys after the deposits
required by Sections 4.05(A)(1) through 4.05(A)(4) hereof may be transferred, at the
discretion of the Issuer, to the Unrestricted Revenue Account or to any other appropriate
fund or account of the Issuer and be used for any lawful purpose.
(B) The Issuer, in its discretion, may use moneys in the Principal Account and the Interest
Account to purchase or redeem Bonds coming due on the next principal payment date, provided
such purchase or redemption does not adversely affect the Issuer's ability to pay the principal or
interest coming due on such principal payment date on the Bonds not so purchased or redeemed.
(C) At least one business day prior to the date established for payment of any principal of
or Redemption Price, if applicable, or interest on the Bonds, the Issuer shall withdraw from the
appropriate account of the Debt Service Fund sufficient moneys to pay such principal or
28
Redemption Price, if applicable, or interest and deposit such moneys with the Paying Agent for
the Bonds to be paid.
(D) In the event the Issuer shall issue Additional Bonds pursuant to this Resolution, the
Issuer may establish such separate subaccounts in the Interest Account, the Principal Account
and the Bond Amortization Account to provide for payment of the principal of and interest on
such Series; provided one Series of Bonds shall not have preference in payment from Pledged
Funds over any other Series of Bonds. The Issuer may also deposit moneys in such subaccounts
at such other times and in such other amounts from those provided in this Section 4.05 as shall be
necessary to pay the principal of and interest on such Bonds as the same shall become due, all as
provided by the Supplemental Resolution authorizing such Bonds.
SECTION 4.06. Investments. The Construction Fund, the Restricted Revenue Account
and the Debt Service Fund shall be continuously secured in the manner by which the deposit of
public funds are authorized to be secured by the laws of the State. Moneys on deposit in the
Construction Fund, the Restricted Revenue Account and the Debt Service Fund may be invested
and reinvested in Permitted Investments maturing no later than the date on which the moneys
therein will be needed. Any and all income received by the Issuer from the investment of
moneys in each account of the Construction Fund, the Interest Account, the Principal Account,
the Bond Amortization Account, the Reserve Account (but only to the extent that the amount
therein is less than the Reserve Account Requirement) and the Restricted Revenue Account shall
be retained in such respective Fund or Account unless otherwise required by applicable law. To
the extent that the amount in the Reserve Account is equal to or greater than the Reserve Account
Requirement, any and all income received by the Issuer from the investment of moneys therein
shall be transferred, upon receipt, and deposited into the Interest Account.
Nothing contained in this Resolution shall prevent any Permitted Investments acquired as
investments of or security for funds held under this Resolution from being issued or held in
book-entry form on the books of the Department of the Treasury of the United States.
SECTION 4.07. Separate Accounts. The moneys required to be accounted for in each of
the foregoing funds and accounts established herein may be deposited in a single bank account,
and funds allocated to the various funds and accounts established herein may be invested in a
common investment pool, provided that adequate accounting records are maintained to reflect
and control the restricted allocation of the moneys on deposit therein and such investments for
the various purposes of such funds and accounts as herein provided.
The designation and establishment of the various funds and accounts in and by this
Resolution shall not be construed to require the establishment of any completely independent,
self-balancing funds as such term is commonly defined and used in governmental accounting, but
rather is intended solely to constitute an earmarking of certain revenues for certain purposes and
to establish certain priorities for application of such revenues as herein provided.
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[End of Article IV]
30
ARTICLE V
SUBORDINATED INDEBTEDNESS,
ADDITIONAL BONDS, COVENANTS OF ISSUER, BOND INSURANCE
SECTION 5.01. Subordinated Indebtedness. The Issuer will not issue any other
obligations, except under the conditions and in the manner provided herein, payable from the
Pledged Funds or voluntarily create or cause to be created any debt, lien, pledge, assignment,
encumbrance or other charge having priority to or being on a parity with the lien thereon in favor
of the Bonds and the interest thereon. The Issuer may at any time or from time to time issue
evidences of indebtedness payable in whole or in part out of the Pledged Funds and which may
be secured by a pledge of the Pledged Funds; provided, however, that such pledge shall be, and
shall be expressed to be, subordinated in all respects to the pledge of the Pledged Funds created
by this Resolution. The Issuer shall have the right to covenant with the holders from time to time
of any Subordinated Indebtedness to add to the conditions, limitations and restrictions under
which any Additional Bonds may be issued pursuant to Section 5.02 hereof. The Issuer agrees to
pay promptly any Subordinated Indebtedness as the same shall become due.
SECTION 5.02. Issuance of Additional Bonds. No Additional Bonds, payable on a
parity with the Bonds then Outstanding pursuant to this Resolution, shall be issued except upon
the conditions and in the manner herein provided. The Issuer may issue one or more Series of
Additional Bonds for any one or more of the following purposes: financing the completion of
the Initial Project, financing the Cost of an Additional Project or the completion thereof, or
refunding any or all Outstanding Bonds or of any Subordinated Indebtedness of the Issuer.
No such Additional Bonds shall be issued unless the following conditions are complied
with:
(A) There shall have been obtained and filed with the Issuer a statement of an
independent certified public accountant of reasonable experience and responsibility: (I) stating
that the books and records of the Issuer relating to the Sales Tax Revenues have been audited by
him or her; (2) setting forth the amount of the Sales Tax Revenues which have been received by
the Issuer during any twelve (12) consecutive months designated by the Issuer within the thirty
(30)months immediately preceding the date of delivery of such Additional Bonds with respect to
which such statement is made; and (3) stating that the amount of the Sales Tax Revenues
received during the aforementioned twelve (12) month period equals at least 1.35 times the
Maximum Annual Debt Service of all Bonds then Outstanding and such Additional Bonds with
respect to which such statement is made.
(B) Additional Bonds shall be deemed to have been issued pursuant to this Resolution the
same as the Outstanding Bonds, and all of the other covenants and other provisions of this
Resolution (except as to details of such Additional Bonds inconsistent therewith) shall be for the
31
equal benefit, protection and security of the Holders of all Bonds issued pursuant to this
Resolution. All Bonds, regardless of the time or times of their issuance, shall rank equally with
respect to their lien on the Pledged Funds and their sources and security for payment therefrom
without preference of any Bond over any other.
(C) In the event any Additional Bonds are issued for the purpose of refunding any Bonds
then Outstanding, the conditions of Section 5.02(A) hereof shall not apply, provided that the
issuance of such Additional Bonds shall not result in an increase in the aggregate amount of
principal of and interest on the Outstanding Bonds becoming due in the current Bond Year and
all subsequent Bond Years. The conditions of Section 5.02(A) hereof shall apply to Additional
Bonds issued to refund Subordinated Indebtedness and to Additional Bonds issued for refunding
purposes which cannot meet the conditions of this paragraph.
SECTION 5.03. Bond Anticipation Notes. The Issuer may issue notes in anticipation of
the issuance of Bonds which shall have such terms and details and be secured in such manner,
not inconsistent with this Resolution, as shall be provided by resolution of the Issuer.
SECTION 5.04. Books and Records. The Issuer will keep books and records of the
receipt of the Sales Tax Revenues in accordance with generally accepted accounting principles,
and any Holder or Holders of Bonds shall have the right at all reasonable times to inspect the
records, accounts and data of the Issuer relating thereto.
SECTION 5.05. Annual Audit. The Issuer shall, immediately after the close of each
Fiscal Year, cause the financial statements of the Issuer to be properly audited by a recognized
independent certified public accountant or recognized independent firm of certified public
accountants, and shall require such accountants to complete their report on the annual financial
statements in accordance with applicable law. Such annual financial statements shall contain,
but not be limited to, a balance sheet, a statement of revenues, expenditures and changes in fund
balance, and any other statements as required by law or accounting convention, and a report by
such accountants disclosing any material default on the part of the Issuer of any covenant or
agreement herein which is disclosed by the audit of the financial statements. lie annual
financial statements shall be prepared in conformity with generally accepted accounting
principles. A copy of the audited financial statements for each Fiscal Year shall be furnished to
any Holder of a Bond who shall have furnished such Holder's address to the Clerk and requested
in writing that the same be furnished to such Holder. The Issuer shall be permitted to make a
reasonable charge for furnishing such audited financial statements.
SECTION 5.06. No Impairment. The pledging of the Pledged Funds in the manner
provided herein shall not be subject to repeal, modification or impairment by any subsequent
ordinance, resolution or other proceedings of the City Commission of the Issuer.
SECTION 5.07. Collection of Sales Tax Revenues. The Issuer will take all action
legally available to it to ensure receipt of Pledged Funds sufficient to make all payments of
32
principal of and interest on the Bonds, as and when the same become due, and all other payments
required herein, and will take no action which will impair or adversely affect its receipt of the
Pledged Funds.
SECTION 5.08. Federal Income Tax Covenants; Taxable Bonds.
(A) The Issuer covenants with the Holders of each Series of Bonds (other than Taxable
Bonds) that it shall not use the proceeds of such Series of Bonds in any manner which would
cause the interest on such Series of Bonds to be or become includable in the gross income of the
Holders thereof for federal income tax purposes.
(B) The Issuer covenants with the Holders of each Series of Bonds (other than Taxable
Bonds) that neither the Issuer nor any Person under its control or direction will make any use of
the proceeds of such Series of Bonds (or amounts deemed to be proceeds under the Code) in any
manner which would cause such Series of Bonds to be "private activity bonds" within the
meaning of Section 141 of the Code or "arbitrage bonds" within the meaning of Section 148 of
the Code, and neither the Issuer nor any other Person under its control or direction shall do any
act or fail to do any act which would otherwise cause the interest on such Series of Bonds to
become includable in the gross income of the Holders thereof for federal income tax purposes.
(C) The Issuer hereby covenants with the Holders of each Series of Bonds (other than
Taxable Bonds) that it will comply with all provisions of the Code necessary to maintain the
exclusion of interest on the Bonds from the gross income of the Holders thereof for federal
income tax purposes, including, in particular, the payment of any amount required to be rebated
to the U.S. Treasury pursuant to the Code.
(D)The Issuer may, if it so elects, issue one or more Series of Taxable Bonds the interest
on which is (or may be) includable in the gross income of the Holders thereof for federal income
tax purposes, so long as each Bond of such Series states in the body thereof that interest payable
thereon is (or may be) subject to federal income taxation and provided that the issuance thereof
will not cause the interest on any other Bonds theretofore issued hereunder to be or become
includable in the gross income of the Holders thereof for federal income tax purposes. The
covenants set forth in paragraphs(A), (B) and(C)above shall not apply to any Taxable Bonds.
SECTION 5.09. Appointment of Insurer and Supplemental Provisions Regarding Insurer
for Series 1999 Bonds. The purchase of a municipal bond insurance policy has been determined
by the City Manager to be desirable to be provided for the Series 1999 Bonds, and such Insurer
shall be Financial Security Assurance, Inc., a New York Stock insurance company, or any
successor thereto or assignee thereof(the"Insurer").
The City Manager and the Mayor of the Issuer, are each designated as agents of the Issuer
in connection with the issuance and delivery of the Insurance Policy and are authorized and
empowered, collectively or individually, upon the execution by the Issuer of the bond purchase
33
agreement with respect to the Series 1999 Bonds, to take all action and steps and to execute all
instruments, documents and contracts on behalf of the Issuer that are necessary or desirable in
connection with the execution and delivery of a Insurance Policy.
(A) Claims Upon the Insurance Policy. If, on the third business day prior to the
related scheduled interest payment date or principal payment date or the date to which a Series
1999 Bond maturity has been accelerated ("Payment Date") there is not on deposit with the
Paying Agent, after making all transfers and deposits required under the Resolution moneys
sufficient to pay the principal of and interest on the Series 1999 Bonds due on such Payment
Date, the Paying Agent shall give notice to the Insurer and to its designated agent (if any) (the
"Insurer's Fiscal Agent") by telephone or telecopy of the amount of such deficiency by 12:00
noon, New York City time, on such Business Day. If, on the second Business Day prior to the
related Payment Date, there continues to be a deficiency in the amount available to pay the
principal of and interest on the Series 1999 Bonds due on such Payment Date, the Paying Agent
shall make a claim under the Insurance Policy and give notice to the Insurer and the Insurer's
Fiscal Agent (if any) by telephone of the amount of such deficiency, and the allocation of such
deficiency between the amount required to pay interest on the Series 1999 Bonds and the amount
required to pay principal of the Series 1999 Bonds, confirmed in writing to the Insurer and the
Insurer's Fiscal Agent by 12:00 noon, New York City time, on such second Business Day by
filling in the form of Notice of Claim and Certificate delivered with the Insurance Policy.
In the event the claim to be made is for an Amortization Installment, upon receipt of the
moneys due, the Registrar shall authenticate and deliver to affected Series 1999 Bondholders
who surrender their Series 1999 Bonds a new Series 1999 Bond or Series 1999 Bonds in an
aggregate principal amount equal to the unredeemed portion of the Series 1999 Bond
surrendered. The Registrar shall designate any portion of payment of principal on the Series
1999 Bonds paid by the Insurer, whether by virtue of mandatory sinking fund redemption,
maturity or other advancement of maturity, on its books as a reduction in the principal amount of
the Series 1999 Bonds registered to the then current Series 1999 Bondholder, whether DTC or its
nominee or otherwise, and shall issue a replacement Series 1999 Bond to the Insurer, registered
in the name of Financial Security Assurance, Inc., in a principal amount equal to the amount of
principal so paid (without regard to authorized denominations); provided that the Registrar's
failure to so designate any payment or issue any replacement Series 1999 Bond shall have no
effect on the amount of principal or interest payable by the Issuer on any Bond or the subrogation
rights of the Insurer.
The Paying Agent shall keep a complete and accurate record of all funds deposited by the
Insurer into the Policy Payments Account (as described below) and the allocation of such funds
to payment of interest on and principal paid in respect of any Series 1999 Bond. The Insurer
shall have the right to inspect such records at reasonable times upon reasonable notice to the
Paying Agent.
Upon payment of a claim under the Insurance Policy, the Paying Agent shall establish a
34
separate special purpose trust account for the benefit of the Series 1999 Bondholders referred to
herein as the "Policy Payments Account" and over which the Paying Agent shall have exclusive
control and sole right of withdrawal. The Paying Agent shall receive any amount paid under the
Insurance Policy in trust on behalf of the Series 1999 Bondholders and shall deposit any such
amount in the Policy Payments Account and distribute such amount only for purposes of making
the payments for which a claim was made. Such amounts shall be disbursed by the Paying
Agent to the Series 1999 Bondholders in the same manner as principal and interest payments are
to be made with respect to the Series 1999 Bonds under the sections hereof regarding payment of
the Series 1999 Bonds. It shall not be necessary for such payments to be made by checks or wire
transfers separate from the check or wire transfer used to pay debt service with other funds
available to make such payments. However, the amount of any payment of principal of or
interest on the Series 1999 Bonds to be paid from the Policy Payments Account shall be noted as
provided herein.
Funds held in the Policy Payments Account shall not be invested by the Paying Agent
and may not be applied to satisfy any costs, expenses or liabilities of the Paying Agent or of any
other entity.
Any funds remaining in the Policy Payments Account following a Payment Date shall
promptly be remitted to the Insurer.
The Insurer shall, to the extent it makes any payment of principal of or interest on the
Series 1999 Bonds, become subrogated to the rights of the recipients of such payments in
accordance with the terms of the Insurance Policy.
The Insurer shall be entitled to pay principal or interest on the Series 1999 Bonds that
shall become Due for payment but shall be unpaid by reason of Nonpayment by the Issuer (as
such terms are defined in the Insurance Policy) and any amounts due on the Series 1999 Bonds
as a result of acceleration of the maturity thereof in accordance with this Resolution, whether or
not the Insurer has received a Notice of Nonpayment (as such terms are defined in the Insurance
Policy)or a claim upon the Insurance Policy.
(B) Authorized Investments. The provisions of Exhibit B regarding Authorized
Investments shall be applicable.
(C) Insurer. The rights granted to the Insurer under this Resolution to request, consent
to or direct any action are rights granted to the Insurer in consideration of its issuance of the
Insurance Policy. Any exercise by the Insurer of such rights is merely an exercise of the Insurer's
contractual rights and shall not be construed or deemed to be taken for the benefit or on behalf of
the Bondholders nor does such action evidence any position of the Insurer, positive or negative,
as to whether Bondholder consent is required in addition to consent of the Insurer. Amounts paid
by the Insurer under the Insurance Policy shall not be deemed paid for purposes of this
Resolution and shall remain Outstanding and continue to be due and owing until paid by the
35
Issuer in accordance with this Resolution.
The Insurer of the Series 1999 Bonds shall be deemed to be the sole holder of the Series
1999 Bonds insured by it for the purpose of exercising any voting right or privilege or giving any
consent or direction or taking any other action that the holders of the Series 1999 Bonds are
entitled to take pursuant to this Resolution.
The Insurer shall, to the extent it makes any payment of principal of or interest on the
Series 1999 Bonds, become subrogated to the rights of the recipients of such payments in
accordance with the terms of the Insurance Policy.
No contract shall be entered into nor any action taken by which the rights of the Insurer
or security for or sources of payment of the Series 1999 Bonds may be impaired or prejudiced
except upon obtaining the prior written consent of the Insurer.
(D) Reimbursement of Costs to Insurer. The Issuer hereby agrees to pay or reimburse
the Insurer any and all charges, fees, costs and expenses which the Insurer may reasonably pay or
incur in connection with (i) the administration, enforcement, defense or preservation of any
rights or security in respect of this Resolution or any other related document, (ii) the pursuit of
any remedies under this Resolution or any other related document or otherwise afforded by law
or equity, (iii) any amendment, waiver or other action with respect to, or related to, this
Resolution or any other related document whether or not executed or completed, (iv) the
violation by the Issuer of any law, rule or regulation, or any judgment, order or decree applicable
to it or (v) any litigation or other dispute in connection with this Resolution or any other related
document or the transactions contemplated thereby, other than amounts resulting from the failure
of the Insurer to honor its obligations under the Insurance Policy; costs and expenses shall
include a reasonable allocation of compensation and overhead attributable to time of employees
of the Insurer spent solely in connection with the actions described above. The Insurer reserves
the right to charge a reasonable fee as a condition to executing any amendment, waiver or
consent proposed in respect of this Resolution or any other related document.
(E) Notices and Information to the Insurer. The notice address of the Insurer is:
Financial Security Assurance Inc., 350 Park Avenue, New York, New York 10022-6022,
Attention: Managing Director-- Surveillance; Re: Policy No. Telephone: (212)
826-0100; Telecopier: (212) 339-3529. In each case in which notice or other communication
refers to an Event of Default, then a copy of such notice or other communication shall also be
sent to the attention of General Counsel and shall be marked to indicate "URGENT MATERIAL
ENCLOSED."
The Issuer hereby covenants to provide the Insurer with the following information:
(i) Annual audited financial statements within 120 days after the end of the
Issuer's fiscal year and the Issuer's annual budget within 30 days after the approval
36
thereof;
(ii) Notice of any draw upon the Debt Service Reserve Fund in the Debt
Service Fund within two Business Days after knowledge thereof other than (i)
withdrawals of amounts in excess of the amount required to be on deposit therein as the
Reserve Account Requirement and (ii) withdrawals in connection with a refunding of
Bonds;
(iii) Notice of any default known to the Paying Agent within five Business
Days after knowledge thereof;
(iv) Prior notice of the advance refunding or redemption of any of the Series
1999 Bonds, including the principal amount, maturities and CUSIP numbers thereof;
(v) Notice of the resignation or removal of the Paying Agent and Registrar
and the appointment of, and acceptance of duties by, any successor thereto;
(vi) Notice of the commencement of any proceeding by or against the Issuer
commenced under the United States Bankruptcy Code or any other applicable
bankruptcy, insolvency, receivership, rehabilitation or similar law (an "Insolvency
Proceeding");
(vii) Notice of the making of any claim in connection with any Insolvency
Proceeding seeking the avoidance as a preferential transfer of any payment of principal
of, or interest on,the Series 1999 Bonds;
(viii) Notice of any change in the security pledged under this Resolution;
(ix) A full original transcript of all proceedings relating to the execution of any
amendment or supplement to the related documents; and
(x) All reports, notices and correspondence to be delivered under the terms of
this Resolution or a Supplemental Resolution.
SECTION 5.10. Provisions Relating to Reserve Account Insurance Policy.
(a) The Issuer shall purchase the Reserve Policy for deposit to the Reserve Account
to secure the Series 1999 Bonds. The Issuer shall repay any draws under the Reserve Policy and
pay all related reasonable expenses incurred by the Insurer. Interest shall accrue and he payable
on such draws and expenses from the date of payment by the Insurer at the Late Payment Rate.
"Late Payment Rate" means the lesser of (a) the greater of (i) the per annum rate of interest,
publicly announced form time to time by The Chase Manhattan Bank at its principal office in the
City of New York, as its prime or base lending rate ("Prime Rate") (any change in such Prime
Rate to be effective on the date such change is announced by The Chase Manhattan Bank) plus
37
3% and (ii) the then applicable highest rate of interest on the Bonds and (b) the maximum rate
permissible under applicable usury or similar laws limiting interest rates. The Late Payment
Rate shall be computed on the basis of the actual number of days elapsed over a year of 360
days. In the event The Chase Manhattan Bank ceases to announce its Prime Rate publicly, Prime
Rate shall be the publicly announced prime or base lending rate of such national bank as the
Insurer shall specify.
Repayment of draws and payment of expenses and accrued interest thereon at the Late
Payment Rate (collectively "Policy Costs") shall commence in the first month following each
draw, and each such monthly payment shall be in an amount at least equal to 1/12 of the
aggregate of Policy Costs related to such draw.
Amounts in respect of Policy Costs paid to the Insurer shall be credited first to interest
due, then to the expenses due and then to principal due. As and to the extent that payments are
made to the Insurer on account of principal due, the coverage under the Reserve Policy will be
increased by a like amount, subject to the terms of the Reserve Policy.
(b) If the Issuer shall fail to pay any Policy Costs in accordance with the requirements
of paragraph (a) above, the Insurer shall be entitled to exercise any and all legal and equitable
remedies available to it, including those provided under this Resolution, as amended and
supplemented, other than (i) acceleration of the maturity of the Bonds, or (ii) remedies which
would adversely affect owners of the Bonds.
(c) In order to secure the Issuer's payment obligations with respect to the Policy Costs
there shall be granted and perfected in favor of the Insurer a security interest (subordinate only to
that of the owners of the Bonds) in all Pledged Funds pledged as security for the Bonds.
(d) The Paying Agent shall ascertain the necessity for a claim upon the Reserve
Policy and to provide notice to Insurer in accordance with the terms of the Reserve Policy at least
five business days prior to each date upon which interest or principal is due on the Bonds.
[End of Article V]
38
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. The following events shall each constitute an "Event
of Default:"
(A) Default shall be made in the payment of the principal of, Amortization Installment,
redemption premium or interest on any Bond when due.
(B) There shall occur the dissolution or liquidation of the Issuer, or the filing by the
Issuer of a voluntary petition in bankruptcy, or the commission by the Issuer of any act of bank-
ruptcy, or adjudication of the Issuer as a bankrupt, or assignment by the Issuer for the benefit of
its creditors, or appointment of a receiver for the Issuer, or the entry by the Issuer into an
agreement of composition with its creditors, or the approval by a court of competent jurisdiction
of a petition applicable to the Issuer in any proceeding for its reorganization instituted under the
provisions of the Federal Bankruptcy Act, as amended, or under any similar act in any
jurisdiction which may now be in effect or hereafter enacted.
(C) The Issuer shall default in the due and punctual performance of any other of the
covenants, conditions, agreements and provisions contained in the Bonds or in this Resolution on
the part of the Issuer to be performed, and such default shall continue for a period of thirty (30)
days after written notice of such default shall have been received from the Holders of not less
than twenty-five percent (25%) of the aggregate principal amount of Bonds Outstanding or the
Insurer of such amount of Bonds. Notwithstanding the foregoing, the Issuer shall not be deemed
in default hereunder if such default can be cured within a reasonable period of time and if the
Issuer in good faith institutes curative action and diligently pursues such action until the default
has been corrected.
SECTION 6.02. Remedies. Any Holder of Bonds issued under the provisions of this
Resolution or any trustee or receiver acting for such Bondholders may either at law or in equity,
by suit, action, mandamus or other proceedings in any court of competent jurisdiction, protect
and enforce any and all rights under the laws of the State, or granted and contained in this
Resolution, and may enforce and compel the performance of all duties required by this Resolu-
tion or by any applicable statutes to be performed by the Issuer or by any officer thereof.
The Holder or Holders of Bonds in an aggregate principal amount of not less than twenty-
five percent (25%) of the Bonds then Outstanding may by a duly executed certificate in writing
appoint a trustee for Holders of Bonds issued pursuant to this Resolution with authority to
represent such Bondholders in any legal proceedings for the enforcement and protection of the
rights of such Bondholders and such certificate shall be executed by such Bondholders or their
duly authorized attorneys or representatives, and shall be filed in the office of the Clerk. Notice
39
of such appointment, together with evidence of the requisite signatures of the Holders of not less
than twenty-five percent(25%) in aggregate principal amount of Bonds Outstanding and the trust
instrument under which the trustee shall have agreed to serve shall be filed with the Issuer and
the trustee and notice of appointment shall be given to all Holders of Bonds in the same manner
as notices of redemption are given hereunder. After the appointment of the first trust hereunder,
no further trustees may be appointed; however, the Holders of a majority in aggregate principal
amount of all the Bonds then Outstanding may remove the trustee initially appointed and appoint
a successor and subsequent successors at any time.
SECTION 6.03. Directions to Trustee as to Remedial Proceedings. The Holders of a
majority in principal amount of the Bonds then Outstanding (or any Insurer insuring any then
Outstanding Bonds) have the right, by an instrument or concurrent instruments in writing
executed and delivered to the trustee, to direct the method and place of conducting all remedial
proceedings to be taken by the trustee hereunder, provided that such direction shall not be
otherwise than in accordance with law or the provisions hereof, and that the trustee shall have the
right to decline to follow any such direction which in the opinion of the trustee would be unjustly
prejudicial to Holders of Bonds not parties to such direction.
SECTION 6.04. Remedies Cumulative. No remedy herein conferred upon or reserved to
the Bondholders is intended to be exclusive of any other remedy or remedies, and each and every
such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder
or now or hereafter existing at law or in equity or by statute.
SECTION 6.05. Waiver of Default. No delay or omission of any Bondholder 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 an acquiescence therein; and every power and
remedy given by Section 6.02 of this Resolution to the Bondholders may be exercised from time
to time, and as often as may be deemed expedient.
SECTION 6.06. Application of Moneys After Default. If an Event of Default shall
happen and shall not have been remedied, the Issuer or a trustee or receiver appointed for the
purpose shall apply all Pledged Funds as follows and in the following order:
(A) To the payment of the reasonable and proper charges, expenses and liabilities of the
trustee or receiver, Registrar and Paying Agent hereunder; and
(B) To the payment of the interest and principal or Redemption Price, if applicable, then
due on the Bonds, as follows:
(1) Unless the principal of all the Bonds shall have become due and payable, all
such moneys shall be applied:
FIRST: to the payment to the Persons entitled thereto of all installments of
40
interest then due, in the order of the maturity of such installments, and, if the amount
available shall not be sufficient to pay in full any particular installment, then to the
payment ratably, according to the amounts due on such installment, to the Persons
entitled thereto, without any discrimination or preference;
SECOND: to the payment to the Persons entitled thereto of the unpaid principal
of any of the Bonds which shall have become due at maturity or upon mandatory
redemption prior to maturity (other than Bonds called for redemption for the payment of
which moneys are held pursuant to the provisions of Section 8.01 of this Resolution), in
the order of their due dates,with interest upon such Bonds from the respective dates upon
which they became due, and, if the amount available shall not be sufficient to pay in full
Bonds due on any particular date, together with such interest, then to the payment first of
such interest, ratably according to the amount of such interest due on such date, and then
to the payment of such principal, ratably according to the amount of such principal due on
such date, to the Persons entitled thereto without any discrimination or preference; and
THIRD: to the payment of the Redemption Price of any Bonds called for optional
redemption pursuant to the provisions of this Resolution.
(2) If the principal of all the Bonds shall have become due and payable, all such
moneys shall be applied to the payment of the principal and interest then due and unpaid
upon the Bonds, with interest thereon as aforesaid, without preference or priority of
principal over interest or of interest over principal, or of any installment of interest over
any other installment of interest, or of any Bond over any other Bond, ratably, according
to the amounts due respectively for principal and interest, to the Persons entitled thereto
without any discrimination or preference.
[End of Article VI]
41
ARTICLE VII
SUPPLEMENTAL RESOLUTIONS
SECTION 7.01. Supplemental Resolutions Without Bondholders' Consent. The Issuer,
from time to time and at any time, may adopt such Supplemental Resolutions without the consent
of the Bondholders (which Supplemental Resolutions shall thereafter form a part hereof) for any
of the following purposes:
(A) To cure any ambiguity or formal defect or omission or to correct any inconsistent
provisions in this Resolution or to clarify any matters or questions arising hereunder.
(B) To grant to or confer upon the Bondholders any additional rights, remedies, powers,
authority or security that may lawfully be granted to or conferred upon the Bondholders.
(C) To add to the conditions, limitations and restrictions on the issuance of Bonds under
the provisions of this Resolution other conditions, limitations and restrictions thereafter to be
observed.
(D) To add to the covenants and agreements of the Issuer in this Resolution other
covenants and agreements thereafter to be observed by the Issuer or to surrender any right or
power herein reserved to or conferred upon the Issuer.
(E) To specify and determine the matters and things referred to in Sections 2.01, 2.02 or
2.09 hereof, and also any other matters and things relative to such Bonds which are not contrary
to or inconsistent with this Resolution as theretofore in effect, or to amend, modify or rescind
any such authorization, specification or determination at any time prior to the first delivery of
such Bonds.
(F) To authorize Additional Projects or to change or modify the description of the Initial
Project or any Additional Project.
(G) To specify and determine matters necessary or desirable for the issuance of Variable
Rate Bonds.
(H) To make any other change that, in the opinion of the Issuer, would not materially
adversely affect the security for the Bonds.
SECTION 7.02. Supplemental Resolutions with Bondholders' Consent. Subject to the
terms and provisions contained in this Section 7.02 and Section 7.01 hereof, the Holder or
Holders of not less than a majority in aggregate principal amount of the Bonds then Outstanding
shall have the right, from time to time, anything contained in this Resolution to the contrary
42
notwithstanding, to consent to and approve the adoption of such Supplemental Resolution or
resolutions hereto as shall be deemed necessary or desirable by the Issuer for the purpose of
supplementing, modifying, altering, amending, adding to or rescinding, in any particular, any of
the terms or provisions contained in this Resolution; provided, however, that if such modification
or amendment will, by its terms, not take effect so long as any Bonds of any specified Series or
maturity remain Outstanding, the consent of the Holders of such Bonds shall not be required and
such Bonds shall not be deemed to be Outstanding for the purpose of any calculation of
Outstanding Bonds under this Section 7.02. Any Supplemental Resolution which is adopted in
accordance with the provisions of this Section 7.02 shall also require the written consent of the
Insurer of any Bonds which are Outstanding at the time such Supplemental Resolution shall take
effect. No Supplemental Resolution may be approved or adopted which shall permit or require
(A) an extension of the maturity of the principal of or the payment of the interest on any Bond
issued hereunder, (B) reduction in the principal amount of any Bond or the Redemption Price or
the rate of interest thereon, (C) the creation of a lien upon or a pledge of other than the lien and
pledge created by this Resolution which adversely affects any Bondholders, (D) a preference or
priority of any Bond or Bonds over any other Bond or Bonds, or (E) a reduction in the aggregate
principal amount of the Bonds required for consent to such Supplemental Resolution. Nothing
herein contained, however, shall be construed as making necessary the approval by Bondholders
of the adoption of any Supplemental Resolution as authorized in Section 7.01 hereof.
If, at any time the Issuer shall determine that it is necessary or desirable to adopt any
Supplemental Resolution pursuant to this Section 7.02,the Clerk shall cause the Registrar to give
notice of the proposed adoption of such Supplemental Resolution and the form of consent to such
adoption to be mailed, postage prepaid, to all Bondholders at their addresses as they appear on
the registration books. Such notice shall briefly set forth the nature of the proposed
Supplemental Resolution and shall state that copies thereof are on file at the offices of the Clerk
and the Registrar for inspection by all Bondholders. The Issuer shall not, however, be subject to
any liability to any Bondholder by reason of its failure to cause the notice required by this
Section 7.02 to be mailed and any such failure shall not affect the validity of such Supplemental
Resolution when consented to and approved as provided in this Section 7.02.
Whenever the Issuer shall deliver to the Clerk an instrument or instruments in writing
purporting to be executed by the Holders of not less than a majority in aggregate principal
amount of the Bonds then Outstanding, which instrument or instruments shall refer to the
proposed Supplemental Resolution described in such notice and shall specifically consent to and
approve the adoption thereof in substantially the form of the copy thereof referred to in such
notice, thereupon, but not otherwise, the Issuer may adopt such Supplemental Resolution in
substantially such form, without liability or responsibility to any Holder of any Bond, whether or
not such Holder shall have consented thereto.
If the Holders of not less than a majority in aggregate principal amount of the Bonds
Outstanding at the time of the adoption of such Supplemental Resolution shall have consented to
and approved the adoption thereof as herein provided, no Holder of any Bond shall have any
43
right to object to the adoption of such Supplemental Resolution, or to object to any of the terms
and provisions contained therein or the operation thereof, or in any manner to question the
propriety of the adoption thereof, or to enjoin or restrain the Issuer from adopting the same or
from taking any action pursuant to the provisions thereof.
Upon the adoption of any Supplemental Resolution pursuant to the provisions of this
Section 7.02, this Resolution shall be deemed to be modified and amended in accordance
therewith, and the respective rights, duties and obligations under this Resolution of the Issuer and
all Holders of Bonds then Outstanding shall thereafter be determined, exercised and enforced in
all respects under the provisions of this Resolution as so modified and amended.
SECTION 7.03. Supplemental Resolutions with Insurer's Consent in lieu of
Bondholders' Consent. Notwithstanding any provisions of Section 7.02 above to the contrary, if
the Insurer of a particular Series of Bonds is not then in default in the performance of any of its
obligations under its Insurance Policy, the approvals, consents and notifications required by
Section 7.02 above to be given by or to the Holders of the Bonds, as the case may be, may be
given solely by or to the Insurer, as the case may be, and the instrument contemplated by Section
7.02 above shall be executed solely by the Insurer and the Holders of the Bonds subject to such
Insurance Policy shall have no right to receive such notification or give such approvals and
consents or to execute such certificate except that the adoption of Supplemental Resolutions that
would have any of the effects described in(A)through (E) in Section 7.02 above shall require the
approval and consent of all Holders of Bonds then Outstanding and the Insurer.
[End of Article VII]
44
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Defeasance. If the Issuer shall pay or cause to be paid, or there shall
otherwise be paid to the Holders of all Bonds, the principal or Redemption Price, if applicable,
and interest due or to become due thereon, at the times and in the manner stipulated therein and
in this Resolution, then the pledge of the Pledged Funds, and all covenants, agreements and other
obligations of the Issuer to the Bondholders, shall thereupon cease, terminate and become void
and be discharged and satisfied. In such event, the Paying Agents shall pay over or deliver to the
Issuer all money or securities held by them pursuant to this Resolution which are not required for
the payment or redemption of Bonds not theretofore surrendered for such payment or
redemption.
Any Bonds or interest installments appertaining thereto, whether at or prior to the
maturity or redemption date of such Bonds, shall be deemed to have been paid within the
meaning of this Section 8.01 if (A) in case any such Bonds are to be redeemed prior to the
maturity thereof, there shall have been taken all action necessary to call such Bonds for
redemption and notice of such redemption shall have been duly given or provision shall have
been made for the giving of such notice, and (B) there shall have been deposited in irrevocable
trust with a banking institution or trust company by or on behalf of the Issuer either moneys in an
amount which shall be sufficient, or Federal Securities the principal of and the interest on which
when due will provide moneys which, together with the moneys, if any, deposited with such
bank or trust company at the same time shall be sufficient, to pay the principal of or Redemption
Price, if applicable, and interest due and to become due on said Bonds on and prior to the
redemption date or maturity date thereof, as the case may be. Except as hereafter provided,
neither the Federal Securities nor any moneys so deposited with such bank or trust company nor
any moneys received by such bank or trust company on account of principal of or Redemption
Price, if applicable, or interest on said Federal Securities shall be withdrawn or used for any
purpose other than, and all such moneys shall be held in trust for and be applied to, the payment,
when due, of the principal of or Redemption Price, if applicable, of the Bonds for the payment or
redemption of which they were deposited and the interest accruing thereon to the date of maturity
or redemption; provided, however, the Issuer may substitute new Federal Securities and moneys
for the deposited Federal Securities and moneys if the new Federal Securities and moneys arc
sufficient to pay the principal of or Redemption Price, if applicable, and interest on the refunded
Bonds.
For purposes of determining whether Variable Rate Bonds shall be deemed to have been
paid prior to the maturity or redemption date thereof, as the case may be, by the deposit of
moneys, or specified Federal Securities and moneys, if any, in accordance with this Section 8.01,
the interest to come due on such Variable Rate Bonds on or prior to the maturity or redemption
date thereof, as the case may be, shall be calculated at the Maximum Interest Rate; provided,
45
however, that if on any date, as a result of such Variable Rate Bonds having borne interest at less
than the Maximum Interest Rate for any period, the total amount of moneys and specified
Federal Securities on deposit for the payment of interest on such Variable Rate Bonds is in
excess of the total amount which would have been required to be deposited on such date in
respect of such Variable Rate Bonds in order to satisfy this Section 9.01, such excess shall be
paid to the Issuer free and clear of any trust, lien, pledge or assignment securing the Bonds or
otherwise existing under this Resolution.
In the event the Bonds for which moneys are to be deposited for the payment thereof in
accordance with this Section 8.01 are not by their terms subject to redemption within the next
succeeding sixty (60) days, the Issuer shall cause the Registrar to mail a notice to the Holders of
such Bonds that the deposit required by this Section 8.01 of moneys or Federal Securities has
been made and said Bonds are deemed to be paid in accordance with the provisions of this
Section 8.01 and stating such maturity or redemption date upon which moneys are to be available
for the payment of the principal of or Redemption Price, if applicable, and interest on said
Bonds.
Nothing herein shall be deemed to require the Issuer to call any of the Outstanding Bonds
for redemption prior to maturity pursuant to any applicable optional redemption provisions, or to
impair the discretion of the Issuer in determining whether to exercise any such option for early
redemption.
SECTION 8.02. Sale of Bonds. The Bonds shall be issued and sold at public or private
sale at one time or in installments from time to time and at such price or prices as shall be
consistent with the provisions of the Act, the requirements of this Resolution and other
applicable provisions of law and as shall be approved by subsequent resolution of the Issuer.
SECTION 8.03. General Authority. The members of the City Commission of the Issuer
and the Issuer's officers, attorneys and other agents and employees are hereby authorized to
perform all acts and things required of them by this Resolution or desirable or consistent with the
requirements hereof for the full, punctual and complete performance of all of the terms,
covenants and agreements contained in the Series 1999 Bonds and this Resolution, and they are
hereby authorized to execute and deliver all documents which shall be required by Bond Counsel
or the initial purchasers of the Series 1999 Bonds to effectuate the sale of the Series 1999 Bonds
to said initial purchasers.
SECTION 8.04. No Third Party Beneficiaries. Except such other Persons as may be
expressly described herein or in the Series 1999 Bonds, nothing in this Resolution, or in the
Series 1999 Bonds, expressed or implied, is intended or shall be construed to confer upon any
Person, other than the Issuer and the Holders, any right, remedy or claim, legal or equitable,
under and by reason of this Resolution or any provision hereof, or of the Series 1999 Bonds, all
provisions hereof and thereof being intended to be and being for the sole and exclusive benefit of
the Issuer and the Persons who shall from time to time he the Holders.
46
SECTION 8.05. No Personal Liability. Neither the members of the City Commission of
the Issuer nor any person executing the Bonds shall be personally liable therefor or be subject to
any personal liability or accountability by reason of the issuance thereof.
SECTION 8.06. Severability of Invalid Provisions. If any one or more of the covenants,
agreements or provisions of this Resolution shall be held contrary to any express provision of
law or contrary to the policy of express law, though not expressly prohibited, or against public
policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or
provisions shall be null and void and shall be deemed separable from the remaining covenants,
agreements and provisions of this Resolution and shall in no way affect the validity of any of the
other covenants, agreements or provisions hereof or of the Bonds issued hereunder.
SECTION 8.07. Repeal of Inconsistent Resolutions. All Resolutions or parts thereof in
conflict herewith are hereby superseded and repealed to the extent of such conflict.
SECTION 8.08. Effective Date. This Resolution shall take effect immediately upon its
adoption.
PASSED AND ADOPTED this 19th day of January, 1999.
CITY OF OCOEE, FLORIDA
Attest:
By: By:
Name: Jean Grafton Name: S. Scott Vandergrift
Title: City Clerk Title: Mayor
FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY
BY THE CITY OF OCOEE, COMMISSION AT A MEETING HELD
APPROVED AS TO FORM AND ON JANUARY 19, 1999 UNDER
LEGALITY, THIS 19's DAY AGENDA ITEM NO.
OF JANUARY, 1999
FOLEY & LARDNER
By:
Name: Paul Rosenthal
Title: City Attorney
AND BY:
47
BRYANT, MILLER AND OLIVE, P.A.
By:
Name: Grace E. Dunlap
Title: Bond Counsel
I BONDS\C29‘aiusm wru
lunry u.1999
48
EXIIIBIT A
INITIAL PROJECT DESCRIPTION
A portion of the proceeds of the Series 1999 Bonds shall be used to fund certain capital
improvements of the City, including but not limited to the following:
Capital Improvement Amount
Improvements to Recreational Complex $ 1,100,000
Acquisition and Construction of Public Works Complex 1,200,000
Acquisition and Construction of Fire Station 1,000,000
Acquisition and Construction of Police Department 1,000,000
Acquisition of Park Land 500,000
Total $4,800,000
Capital improvements associated with the City's Recreational Complex include the
construction of an Olympic-sized swimming pool and a bath house. Capital improvements
associated with the Public Works Complex include the acquisition of adjoining land and the
construction of a vehicle fueling facility, a vehicle maintenance facility and an administration
facility. Capital improvements associated with the acquisition and construction of the Police
Department include land acquisition and building design costs. Each of the above referenced
capital improvements are located within the existing corporate limits of the City.
A-1
EXHIBIT B
QUALIFIED INVESTMENTS
l.Direct obligations (other than an obligation subject to variation in principal repayment)
of the United States of America ("United States Treasury Obligations"), (b) obligations fully and
unconditionally guaranteed as to timely payment of principal and interest by the United States of
America, (c) obligations fully and unconditionally guaranteed as to timely payment of principal
and interest by any agency or instrumentality of the United States of America when such
obligations are backed by the full faith and credit of the United States of America, or (d)
evidences of ownership of proportionate interests in future interest and principal payments on
obligations described above held by a bank or trust company as custodian, under which the
owner of the investment is the real party in interest and has the right to proceed directly and
individually against the obligor and the underlying government obligations are not available to
any person claiming through the custodian or to whom the custodian may be obligated.
2. Federal Housing Administration debentures.
3.The listed obligations of government-sponsored agencies which are not backed by the
full faith and credit of the United States of America:
-Federal Home Loan Mortgage Corporation (FHLMC)
Participation certificates (excluded are stripped mortgage securities
which are purchased at prices exceeding their principal amounts)
Senior Debt obligations
-Farm Credit Banks (formerly: Federal Land Banks, Federal
Intermediate Credit Banks and Banks for Cooperatives)
Consolidated system-wide bonds and notes
-Federal Home Loan Banks (FHL Banks)
Consolidated debt obligations
-Federal National Mortgage Association(FNMA)
Senior debt obligations
Mortgage-backed securities (excluded are stripped mortgage
securities which are purchased at prices exceeding their principal amounts)
-Student Loan Marketing Association (SLMA)
Senior debt obligations (excluded are securities that do not have a fixed
par value and/or whose terms do not promise a fixed dollar amount at
maturity or call date)
-Financing Corporation (FICO)
Debt obligations
-Resolution Funding Corporation (REFCORP)
Debt obligations
B-1
4. Unsecured certificates of deposit, time deposits, and bankers' acceptances (having
maturities of not more than 30 days) of any bank the short-term obligations of which are rated
'A-1' or better by S&P.
5. Deposits the aggregate amount of which are fully insured by the Federal Deposit
Insurance Corporation(FDIC), in banks which have capital and surplus of at least $5 million.
6. Commercial paper (having original maturities of not more than 270 days) rated
'A-l+' by S&P and 'Prime-I' by Moody's.
7. Money market funds rated 'AAm' or'AAm-G' by S&P, or better.
8. "State Obligations', which means:
A. Direct general obligations of any state of the United States of America or
any subdivision or agency thereof to which is pledged the full faith and
credit of a state the unsecured general obligation debt of which is rated
'A3' by Moody's and 'A' by S&P, or better, or any obligation fully and
unconditionally guaranteed by any state, subdivision or agency whose
unsecured general obligation debt is so rated.
B. Direct general short-term obligations of any state agency or subdivision or
agency thereof described in (A) above and rated 'A-1+' by S&P and 'MIG-
1' by Moody's.
C. Special Revenue Bonds(as defined in the United States Bankruptcy Code)
of any state, state agency or subdivision described in (A) above and rated
'AA' or better by S&P and 'Aa' or better by Moody's.
9. Pre-refunded municipal obligations rated "AAA" by S & P and "Aaa" by Moody's
meeting the following requirements:
A. The municipal obligations are (1) not subject to redemption prior to
maturity or (2) the trustee for the municipal obligations has been given
irrevocable instructions concerning their call and redemption and the
issuer of the municipal obligations has covenanted not to redeem such
municipal obligations other than as set forth in such instructions;
B. The municipal obligations are secured by cash or United States Treasury
Obligations which may be applied only to payment of the principal of,
interest and premium on such municipal obligations;
C. The principal of and interest on the United States Treasury Obligations
B-2
(plus any cash in the escrow) has been verified by the report of
independent certified public accountants to be sufficient to pay in full all
principal of, interest, and premium, if any, due and to become due on the
municipal obligations("Verification");
U. The cash or United States Treasury Obligations serving as security for the
municipal obligations are held by an escrow agent or trustee in trust for
owners of the municipal obligations;
E. No substitution of a United States Treasury Obligation shall be permitted
except with another United States Treasury Obligation and upon delivery
of a new Verification; and
F. The cash or United States Treasury Obligations are not available to satisfy
any other claims, including those by or against the trustee or escrow agent.
10. Repurchase agreements:
With (I) any domestic bank, or domestic branch of a foreign bank, the long term
debt of which is rated at least "A" by S&P and Moody's; or (2) any broker-dealer
with "retail customers" or a related affiliate thereof which broker-dealer has, or
the parent company (which guarantees the provider) of which has, long-term debt
rated at least "A" by S&P and Moody's, which broker-dealer falls under the
jurisdiction of the Securities Investors Protection Corporation; or (3) any other
entity rated "A" or better by S&P and Moody's and acceptable to the Insurer,
provided that:
A. The market value of the collateral is maintained at levels and upon such
conditions as would be acceptable to S & P and Moody's to maintain an
"A" rating in an "A" rated structured financing (with a market value
approach);
B. The Trustee or a third party acting solely as agent therefor or for the Issuer
(the "Holder of the Collateral") has possession of the collateral or the
collateral has been transferred to the Holder of the Collateral in accordance
with applicable state and federal laws (other than by means of entries on
the transferor's books);
C. The repurchase agreement shall state and an opinion of counsel shall be
rendered at the time such collateral is delivered that the Holder of the
Collateral has a perfected first priority security interest in the collateral,
any substituted collateral and all proceeds thereof (in the case of bearer
securities, this means the Holder of the Collateral is in possession);
B-3
D. All other requirements of S&P in respect of repurchase agreements shall
be met.
E. The repurchase agreement shall provide that if during its term the
provider's rating by either Moody's or S&P is withdrawn or suspended or
falls below "A-" by S&P or "A3" by Moody's, as appropriate, the provider
must, at the direction of the Issuer or the Trustee (who shall give such
direction if so directed by the Insurer), within 10 days of receipt of such
direction, repurchase all collateral and terminate the agreement, with no
penalty or premium to the Issuer or Trustee.
Notwithstanding the above, if a repurchase agreement has a term of 270 days or less (with
no evergreen provision), collateral levels need not be as specified in (A) above, so long as such
collateral levels are 103% or better and the provider is rated at least "A" by S&P and Moody's,
respectively.
11. Investment agreements with a domestic or foreign bank or corporation (other than
a life or property casualty insurance company) the long-term debt of which, or, in the case of a
guaranteed corporation the long-term debt, or, in the case of a monoline financial guaranty
insurance company, claims paying ability, of the guarantor is rated at least "AA" by S&P and
"Aa" by Moody's; provided that, by the terms of the investment agreement:
A. Interest payments are to be made to the Trustee at times and in amounts as
necessary to pay debt service (or, if the investment agreement is for the
construction fund, construction draws) on the Bonds;
B. The invested funds are available for withdrawal without penalty or
premium, at any time upon not more than seven days' prior notice; the
Issuer and the Trustee hereby agree to give or cause to be given notice in
accordance with the terms of the investment agreement so as to receive
funds thereunder with no penalty or premium paid;
C. The investment agreement shall state that is the unconditional and general
obligation of, and is not subordinated to any other obligation of, the
provider thereof or, if the provider is a bank, the agreement or the opinion
of counsel shall state that the obligation of the provider to make payments
thereunder ranks pan passu with the obligations of the provider to its other
depositors and its other unsecured and unsubordinated creditors;
D. The Issuer or the Trustee receives the opinion of domestic counsel (which
opinion shall be addressed to the Issuer and the Insurer) that such
investment agreement is legal, valid, binding and enforceable upon the
B-4
provider in accordance with its terms and of foreign counsel (if applicable)
in form and substance acceptable, and addressed to, the Insurer;
E. the investment agreement shall provide that if during its term
(i) the provider's rating by either S&P or Moody's falls below "AA-"
or "Aa3", respectively, the provider shall, at its option, within 10
days of receipt of publication of such downgrade, either (i)
collateralize the investment agreement by delivering or transferring
in accordance with applicable state and federal laws (other than by
means of entries on the provider's books) to the Issuer, the Trustee
or a third party acting solely as agent therefor (the "Holder of the
Collateral") collateral free and clear of any third-party liens or
claims the market value of which collateral is maintained at levels
and upon such conditions as would be acceptable to S & P and
Moody's to maintain an "A" rating in an "A" rated structured
financing (with a market value approach); or (ii) repay the
principal of and accrued but unpaid interest on the investment, and
(ii) the provider's rating by either S&P or Moody's is withdrawn or
suspended or falls below "A-" or "A3", respectively, the provider
must, at the direction of the Issuer or the Trustee (who shall give
such direction if so directed by the Insurer), within 10 days of
receipt of such direction, repay the principal of and accrued but
unpaid interest on the investment, in either case with no penalty or
premium to the Issuer or Trustee, and
P. The investment agreement shall state and an opinion of counsel shall be
rendered, in the event collateral is required to be pledged by the provider
under the terms of the investment agreement, at the time such collateral is
delivered, that the Holder of the Collateral has a perfected first priority
security interest in the collateral, any substituted collateral and all
proceeds thereof(in the case of bearer securities, this means the Holder of
the Collateral is in possession);
G. the investment agreement must provide that if during its term
(i) the provider shall default in its payment obligations, the provider's
obligations under the investment agreement shall, at the direction
of the Issuer or the Trustee (who shall give such direction if so
directed by the Insurer), be accelerated and amounts invested and
accrued but unpaid interest thereon shall be repaid to the Issuer or
Trustee, as appropriate, and
B-5
(ii) the provider shall become insolvent, not pay its debts as they
become due, be declared or petition to be declared bankrupt, etc.
("event of insolvency"), the provider's obligations shall
automatically be accelerated and amounts invested and accrued but
unpaid interest thereon shall be repaid to the Issuer or Trustee, as
appropriate.
B-6
. FS 1�� MUNICIPAL BOND INSURANCE COMMITMENT
FINANCIAL SECURITY ASSURANCE INC. ("Financial Security" or "FSA") hereby commits to issue its Municipal Bond
Insurance Policy(the "Policy") relating to whole maturities of the debt obligations described in Exhibit A attached hereto (the
"Bonds'), subject to the terms and conditions set forth in this Commitment, of which Commitment Exhibit A is an integrated
pan, or added hereto (the "Commitment"). To keep this Commitment in effect after the Expiration Date set forth in Exhibit A
attached hereto, a request for renewal must be submitted to Financial Security prior to such Expiration Date. Financial
Security reserves the right to refuse wholly or in pad to grant a renewal.
THE MUNICIPAL BOND INSURANCE POLICY SHALL BE ISSUED IF THE FOLLOWING CONDITIONS ARE SATISFIED:
1. The documents to be executed and delivered in connection with the issuance and sale of the Bonds shall not
contain any untrue or misleading statement of a material fact and shall not fail to state a material fact necessary in order to
make the information contained therein not misleading.
2. No event shall occur which would permit any underwriter or purchaser of the Bonds, otherwise required, not to be
required to underwrite or purchase the Bonds an the date scheduled for the issuance and delivery thereof("Closing Date").
3 There shall be no material change in or affecting the Bonds (including, without limitation, the security for the
Bonds) or the financing documents or the Official Statement (or any similar disclosure documents) to be executed and
delivered in connection with the issuance and sale of the Bonds from the descriptions or forms thereof approved by
Financial Security.
4 The Bonds shall contain no reference to Financial Security, the Policy or the insurance evidenced thereby except
as may be approved by Financial Security. BOND PROOFS SHALL HAVE BEEN APPROVED BY FINANCIAL SECURITY
PRIOR TO PRINTING. The Bonds shall bear a Statement of Insurance in the form provided by Financial Security.
5. Financial Security shall be provided with:
(a) Executed copies of all financing documents, any disclosure document (the "Official Statement") and the
various legal opinions delivered in connection with the issuance and sale of the Bonds (which shall be dated the Closing
Date and which, except for the opinions of counsel relating to the adequacy of disclosure, shall be addressed to Financial
Security or accompanied by a letter of such counsel permitting Financial Security to rely on such opinion as if such opinion
were addressed to Financial Security), including, without limitation, the approving opinion of bond counsel. Each of the
foregoing shall be in form and substance acceptable to Financial Security. Copies of all drafts of such documents prepared
subsequent to the date of the Commitment (blacklined to reflect all revisions from previously reviewed drafts) shall be
furnished to Financial Security for review and approval, Final drafts of such documents shall be provided to Financial
Security at least three (3) business days prior to the issuance of the Policy, unless Financial Security shall agree to some
shorter period.
(b) Evidence of wire Transfer in federal funds of an amount equal to the insurance premium, unless alternative
arrangements for the payment of such amount acceptable to Financial Security have been made prior to the delivery date of
the Bonds
(c) Standard & Poor's Ratings Services, Moody's Investors Service Inc. and Fitch IBCA, Inc. will separately
present bills for their respective fees relating to the Bonds. Payment of such bills should be made directly to such rating
agency. Payment of the rating fee is not a condition to release of the Policy by Financial Security.
6. Promptly after the closing of the Bonds, Financial Security shall receive three completed sets of executed
documents(one original and two photocopies).
7. The Official Statement shall contain the language provided by Financial Security and only such other references to
Financial Security or otherwise as Financial Security shall supply or approve. FINANCIAL SECURITY SHALL BE
PROVIDED WITH SIX PRINTED COPIES OF THE OFFICIAL STATEMENT.
EXHIBIT A
MUNICIPAL BOND INSURANCE COMMITMENT
TERM SHEET
Issuer: City of Ocoee, Florida
Principal Amount of Bonds Insured: Not to Exceed$11,250,000
Name of Bonds Insured: Capital Improvement Refunding Revenue Bonds,Series 1999
Date of Commitment: January 11, 1999 Expiration Date: Friday, March 12, 1999*
Premium: .35%of total debt service on the Bonds Insured
Additional Conditions:
1. The amortization schedule for, and final maturity date of, the Bonds shall be acceptable to
Financial Security.
2. See attached Exhibits B-E.
Terms used in this Commitment and not otherwise defined shall have the meanings ascribed to them in the
document authorizing the issuance of and setting forth the terms for the Bonds described above(the"Resolution").
FINANCIAL SECURITY ASSURANCE INC.
Authorized Officer
*To keep the Commitment in effect to the Expiration Date set forth above, Financial Security must receive a
duplicate of this Exhibit A executed by an appropriate officer by the earlier of the date on which the Official
Statement containing disclosure language about Financial Security is circulated and ten days from the date of this
Commitment.
The undersigned agrees that if the Bonds are insured by a policy of municipal bond insurance, such insurance shall
be provided by Financial Security in accordance with the terms of the Commitment.
CITY OF OCOEE, FLORIDA
Authorized Officer
LVegaNnunlsLstatesWL125a03 Ndoc
EXHIBIT B
Page 1 of 1
STANDARD OPINION REQUIREMENTS
1. Each of the Resolution, the Escrow Agreement and any other transaction documents (collectively, the
"Related Documents') is a legal, valid and binding obligation of the parties thereto, has been duly authorized,
executed and delivered and is enforceable in accordance with its terms.
2. There does not exist any action, suit, proceeding or investigation pending, or to the best of such counsel's
knowledge, threatened which if adversely determined, could materially adversely affect (a) the financial
position of the Issuer, (b) the ability of the Issuer to perform its obligations under the Related Documents, (c)
the security for the Bonds,or(d)the transactions contemplated by the Related Documents.
3. Nothing has come to the attention of disclosure counsel which would cause them to believe that the final
Official Statement (excluding information provided by Financial Security), as of its date and the date of
issuance of the Policy, contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made,not misleading.
L VegaNnunts\states'FU25eo3_N.tloc
EXHIBIT C
Page 1 of 4
RESOLUTION REQUIREMENTS
The Resolution shall incorporate the following requirements either in one section or article entitled "Provisions
Relating to Bond Insurance" (or the like), the provisions of which section or article shall be stated in the
Resolution to govern, notwithstanding anything to the contrary set forth in the Resolution, or individually in
the appropriate sections:
(a) "Insurance Policy"shall be defined as follows: "the insurance policy issued by the Bond Insurer guaranteeing
the scheduled payment of principal of and interest on the Bonds when due". "Insurer" shall be defined as
follows: "Financial Security Assurance Inc., a New York stock insurance company, or any successor thereto
or assignee thereof'.
(b) The prior written consent of the Insurer shall be a condition precedent to the deposit of any credit instrument
provided in lieu of a cash deposit into the Debt Service Reserve Fund.
(c) The Insurer shall be deemed to be the sole holder of the Bonds insured by it for the purpose of exercising any
voting right or privilege or giving any consent or direction or taking any other action that the holders of the
Bonds insured by it are entitled to take pursuant to Article VI (pertaining to defaults and remedies) of the
Resolution. The Paying Agent shall take no action except with the consent, or at the direction, of Financial
Security. The maturity of Bonds insured by the Insurer shall not be accelerated without the consent of the
Insurer.
(d) In the event the maturity of the Bonds is accelerated, the Insurer may elect, in its sole discretion, to pay
accelerated principal and interest accrued [or accreted, as applicable), on such principal to the date of
acceleration (to the extent unpaid by the Issuer) and the Paying Agent shall be required to accept such
amounts. Upon payment of such accelerated principal and interest accrued [or accreted, as applicable] to
the acceleration date as provided above, the Insurer's obligations under the Insurance Policy with respect to
such Bonds shall be fully discharged.
(e) No grace period for a covenant default shall exceed 30 days, nor be extended for more than 60 days, without
the prior written consent of the Insurer.
(I) The Insurer shall be granted the right to remove the Paying Agent.
(g) The Insurer shall be included as a third party beneficiary to the Resolution.
(h) No modification, amendment or supplement to the Resolution or any other transaction document (each a
"Related Document")may become effective except upon obtaining the prior written consent of the Insurer.
(i) Copies of any modification or amendment to the Resolution or any other Related Document shall be sent to
Standard&Poor's Ratings Services and Moody's Investors Service, Inc. at least 10 days prior to the effective
date thereof.
Q) Rights of the Insurer to direct or consent to Issuer, Paying Agent or Bondholder actions under the Resolution
shall be suspended during any period in which the Insurer is in default in its payment obligations under the
Insurance Policy (except to the extent of mounts previously paid by the Insurer and due and owing to the
Insurer)and shall be of no force or effect in the event the Insurance Policy is no longer in effect or the Insurer
asserts that the Insurance Policy is not in effect or the Insurer shall have provided written notice that it waives
such rights.
(k) The rights granted to the Insurer under the Resolution or any other Related Document to request, consent to
or direct any action are rights granted to the Insurer in consideration of its issuance of the Insurance Policy.
Any exercise by the Insurer of such rights is merely an exercise of the Insurer's contractual rights and shall
not be construed or deemed to be taken for the benefit or on behalf of the Bondholders nor does such action
evidence any position of the Insurer, positive or negative, as to whether Bondholder consent is required in
addition to consent of the Insurer.
LNegaNnunisLstatesWL125603_N.dac
EXHIBIT C
Page 2 of 4
(I) Only (1) cash, (2) non-callable direct obligations of the United States of America ("Treasuries"), (3)
evidences of ownership of proportionate interests in future interest and principal payments on Treasuries held
by a bank or trust company as custodian, under which the owner of the investment is the real party in interest
and has the right to proceed directly and individually against the obligor and the underlying Treasuries are not
available to any person claiming through the custodian or to whom the custodian may be obligated or (4) pre-
refunded municipal obligations rated "AAA" and"Aaa" by S&P and Moody's, respectively, or any combination
thereof, shall be authorized to be used to effect defeasance of the Bonds unless the Insurer otherwise
approves.
To accomplish defeasance the Issuer shall cause to be delivered (i) a report of an independent firm of
nationally recognized certified public accountants or such other accountant as shall be acceptable to the
Insurer ("Accountant") verifying the sufficiency of the escrow established to pay the Bonds in full on the
maturity or redemption date ("Verification'), (ii) an Escrow Deposit Agreement (which shall be acceptable in
form and substance to the Insurer), and (iii) an opinion of nationally recognized bond counsel to the effect
that the Bonds are no longer "Outstanding" under the Resolution; each Verification and defeasance opinion
shall be acceptable in form and substance, and addressed, to the Issuer, the Paying Agent and the Insurer.
In the event a forward purchase agreement will be employed in the refunding, such agreement shall be
subject to the approval of the Insurer and shall be accompanied by such opinions of counsel as may be
required by the Insurer. The Insurer shall be provided with final drafts of the above-referenced
documentation not less than five business days prior to the funding of the escrow.
Bonds shall be deemed "Outstanding" under the Resolution unless and until they are in fact paid and retired
or the above criteria are met.
(m) Amounts paid by the Insurer under the Insurance Policy shall not be deemed paid for purposes of the
Resolution and shall remain Outstanding and continue to be due and owing until paid by the Issuer in
accordance with the Resolution.
(n) The Resolution shall not be discharged unless all amounts due or to become due to the Insurer have been
paid in full or duly provided for.
(o) Claims Upon the Insurance Policy and Payments by and to the Insurer.
If, on the third business day prior to the related scheduled interest payment date or principal payment date
("Payment Date") there is not on deposit with the Paying Agent, after making all transfers and deposits
required under the Resolution, moneys sufficient to pay the principal of and interest on the Bonds due on
such Payment Date, the Paying Agent shall give notice to the Bond Insurer and to its designated agent (if
any) (the "Insurer's Fiscal Agent") by telephone or telecopy of the amount of such deficiency by 12:00 noon,
New York City time, on such Business Day. If, on the second Business Day prior to the related Payment
Date, there continues to be a deficiency in the amount available to pay the principal of and interest on the
Bonds due on such Payment Date, the Paying Agent shall make a claim under the Insurance Policy and give
notice to the Insurer and the Insurer's Fiscal Agent Of any) by telephone of the amount of such deficiency,
and the allocation of such deficiency between the amount required to pay interest on the Bonds and the
amount required to pay principal of the Bonds, confirmed in writing to the Insurer and the Insurer's Fiscal
Agent by 12:00 noon, New York City time, on such second Business Day by filling in the form of Notice of
Claim and Certificate delivered with the Insurance Policy.
In the event the claim to be made is for a mandatory sinking fund redemption installment, upon receipt of the
moneys due, the Paying Agent shall authenticate and deliver to affected Bondholders who surrender their
Bonds a new Bond or Bonds in an aggregate principal amount equal to the unredeemed portion of the Bond
surrendered. The Paying Agent shall designate any portion of payment of principal on Bonds paid by the
Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other advancement of maturity,
on its books as a reduction in the principal amount of Bonds registered to the then current Bondholder,
whether DTC or its nominee or otherwise, and shall issue a replacement Bond to the Insurer, registered in the
name of Financial Security Assurance Inc., in a principal amount equal to the amount of principal so paid
(without regard to authorized denominations); provided that the Paying Agent's failure to so designate any
payment or issue any replacement Bond shall have no effect on the amount of principal or interest payable by
the Issuer on any Bond or the subrogation rights of the Insurer.
LVegaNnunislslales\FL@5e03 N.doc
EXHIBIT C
Page 3 of 4
The Paying Agent shall keep a complete and accurate record of all funds deposited by the Insurer into the
Policy Payments Account and the allocation of such funds to payment of interest on and principal paid in
respect of any Bond. The Insurer shall have the right to inspect such records at reasonable times upon
reasonable notice to the Paying Agent.
Upon payment of a claim under the Insurance Policy the Paying Agent shall establish a separate special
purpose trust account for the benefit of Bondholders referred to herein as the"Policy Payments Account" and
over which the Paying Agent shall have exclusive control and sole right of withdrawal. The Paying Agent
shall receive any amount paid under the Insurance Policy in trust on behalf of Bondholders and shall deposit
any such amount in the Policy Payments Account and distribute such amount only for purposes of making the
payments for which a claim was made. Such amounts shall be disbursed by the Paying Agent to
Bondholders in the same manner as principal and interest payments are to be made with respect to the
Bonds under the sections hereof regarding payment of Bonds. It shall not be necessary for such payments to
be made by checks or wire transfers separate from the check or wire transfer used to pay debt service with
other funds available to make such payments.
Funds held in the Policy Payments Account shall not be invested by the Paying Agent and may not be
applied to satisfy any costs,expenses or liabilities of the Paying Agent.
Any funds remaining in the Policy Payments Account following a Bond payment date shall promptly be
remitted to the Insurer.
(p) The Insurer shall, to the extent it makes any payment of principal of (or, in the case of Capital Appreciation
Bonds, accreted value) or interest on the Bonds, become subrogated to the rights of the recipients of such
payments in accordance with the terms of the Insurance Policy.
(q) The Issuer shall pay or reimburse the Insurer any and all charges, fees, costs and expenses which the
Insurer may reasonably pay or incur in connection with (i) the administration, enforcement, defense or
preservation of any rights or security in any Related Document; (ii) the pursuit of any remedies under the
Resolution or any other Related Document or otherwise afforded by law or equity, (iii) any amendment,
waiver or other action with respect to, or related to,the Resolution or any other Related Document whether or
not executed or completed, (iv)the violation by the Issuer or the Obligor of any law, rule or regulation, or any
judgment, order or decree applicable to it or (v) any litigation or other dispute in connection with the
Resolution or any other Related Document or the transactions contemplated thereby, other than amounts
resulting from the failure of the Insurer to honor its obligations under the Insurance Policy. The Insurer
reserves the right to charge a reasonable fee as a condition to executing any amendment, waiver or consent
proposed in respect of the Resolution or any other Related Document.
(r) Payments required to be made to the Insurer shall be payable solely from the Trust Estate and shall be paid
(i) prior to an event of default, to the extent not paid from the Bond Fund, after required deposits to the Debt
Service Reserve Fund and (li) after an event of default, with respect to amounts other than principal and
interest on the Bonds, on the same priority as payments to the Paying Agent for expenses. The obligations
to the Insurer shall survive discharge or termination of the Related Documents.
(s) The Insurer shall be entitled to pay principal (or, in the case of Capital Appreciation Bonds, accreted value) or
interest on the Bonds that shall become Due for Payment but shall be unpaid by reason of Nonpayment by
the Issuer(as such terms are defined in the Insurance Policy)and any amounts due on the Bonds as a result
of acceleration of the maturity thereof in accordance with the Resolution, whether or not the Insurer has
received a Notice of Nonpayment (as such terms are defined in the Insurance Policy) or a claim upon the
Insurance Policy.
(t) The notice address of the Insurer is: Financial Security Assurance Inc., 350 Park Avenue, New York, New
York 10022-6022, Attention: Managing Director-- Surveillance; Re: Policy No. Telephone: (212)
826-0100; Telecopier: (212) 339-3529. In each case in which notice or other communication refers to an
Event of Default, then a copy of such notice or other communication shall also be sent to the attention of
General Counsel and shall be marked to indicate"URGENT MATERIAL ENCLOSED?
L:VegaNnunisl states 41t256a3 N.doc
EXHIBIT C
Page 4 of 4
(u) The Insurer shall be provided with the following information:
(i) Annual audited financial statements within 120 days after the end of the Issuer's
fiscal year and the Issuer's annual budget within 30 days after the approval thereof;
(II) Notice of any draw upon the Debt Service Reserve Fund within two Business Days
after knowledge thereof other than (i) withdrawals of amounts in excess of the Debt
Service Reserve Requirement and (ii) withdrawals in connection with a refunding of
Bonds;
(iii) Notice of any default known to the Paying Agent within five Business Days after
knowledge thereof;
(iv) Prior notice of the advance refunding or redemption of any of the Bonds, including
the principal amount, maturities and CUSIP numbers thereof;
(v) Notice of the resignation or removal of the Paying Agent, Paying Agent and Bond
Registrar and the appointment of, and acceptance of duties by, any successor
thereto;
(vi) Notice of the commencement of any proceeding by or against the Issuer or the
Obligor commenced under the United States Bankruptcy Code or any other
applicable bankruptcy, insolvency, receivership, rehabilitation or similar law (an
"Insolvency Proceeding");
(vii) Notice of the making of any claim in connection with any Insolvency Proceeding
seeking the avoidance as a preferential transfer of any payment of principal of. or
interest on,the Bonds;
(viii) A full original transcript of all proceedings relating to the execution of any amendment
or supplement to the Related Documents;and
(ix) All reports, notices and correspondence to be delivered under the terms of the
Related Documents.
(v) Funds and accounts shall be invested in Qualified Investments. Qualified Investments shall conform to the
requirements set forth in Exhibit E. Qualified Investments shall not include corporate debt other than
commercial paper rated in the highest category by the rating agencies. Investments purchased with funds on
deposit in the Debt Service Reserve Fund shall have an average aggregate weighted term to maturity not
greater than five years.
LVegarmunisl states 1RA25603_N.dac
EXHIBIT D
Page 1 of 1
REFUNDING REQUIREMENTS
1. The defeasance of the Refunded Bonds shall be accomplished by the deposit solely of cash or direct non-
callable obligations of the United States of America ('Direct Obligations") unless otherwise approved by
Financial Security. The document providing for the establishment and maintenance of the escrow to provide
such defeasance (the "Escrow Deposit Agreement') shall be in form and substance acceptable to Financial
Security. Modification of the Escrow Deposit Agreement shall not be permitted unless Financial Security shall
consent to such modification.
2. In the event a forward purchase agreement ("FPC') will be employed in the refunding, such agreement shall
be subject to the approval of Financial Security and shall be accompanied by opinions of counsel as required
by Financial Security. Financial Security shall provide its requirements for FPCs upon request.
3. At least three business days prior to the proposed date for delivery of the Policy, Financial Security shall
receive for its review and approval (i)the verification letter, of which Financial Security shall be an addressee,
by an independent firm of certified public accountants which is either nationally recognized or otherwise
acceptable to Financial Security, of the adequacy of the escrow established to provide for the payment of the
Refunded Bonds in accordance with the terms and provisions of the Escrow Deposit Agreement (the "Original
Verification")', (ii) copies of the subscription forms for the purchase and issue of U.S. Treasury Securities -
State and Local Government Series which have been stamped as received by the Bureau of Public Debt, (iii)
the form of an opinion of Bond Counsel addressed to Financial Security (or a reliance letter relating thereto)to
the effect that, upon the making of the required deposit to the escrow, the legal defeasance of the Refunded
Bonds shall have occurred and (iv) the form of an opinion of Bond Counsel addressed to Financial Security
(or a reliance letter relating thereto) to the effect that the Escrow Deposit Agreement is a valid and binding
obligation of the parties thereto enforceable in accordance with its terms. An executed copy of each of such
opinion and reliance letter, if applicable, shall be forwarded to Financial Security together with the opinion
requested by Condition 5 hereof.
In the event an FPC is employed the Original Verification should also verify the adequacy of the FPC securities to
pay the portion of debt service on the Refunded Bonds to which the FPC relates.
LVegaNminis\states\FL 25603 N.doc
EXHIBIT E
Page 1 of 4
QUALIFIED INVESTMENTS
THESE ARE BROAD GUIDELINES BASED ON S & P PARAMETERS OTHER INVESTMENTS DESIRED BY THE
OBLIGOR MAY BE INCLUDED IN THE RESOLUTION SUBJECT TO FSA APPROVAL
1. Direct obligations (other than an obligation subject to variation in principal repayment) of the United States of
America ("United States Treasury Obligations"), (b) obligations fully and unconditionally guaranteed as to
timely payment of principal and interest by the United States of America, (c) obligations fully and
unconditionally guaranteed as to timely payment of principal and interest by any agency or instrumentality of
the United States of America when such obligations are backed by the full faith and credit of the United States
of America. or (d) evidences of ownership of proportionate interests in future interest and principal payments
on obligations described above held by a bank or trust company as custodian, under which the owner of the
investment is the real party in interest and has the right to proceed directly and individually against the obligor
and the underlying government obligations are not available to any person claiming through the custodian or
to whom the custodian may be obligated. THESE MAY CONSTITUTE DEFEASANCE OBLIGATIONS.
2. Federal Housing Administration debentures.
3. The listed obligations of government-sponsored agencies which are not backed by the full faith and credit of
the United States of America:
-Federal Home Loan Mortgage Corporation (FHLMC)
Participation certificates(excluded are stripped mortgage securities
which are purchased at prices exceeding their principal amounts)
Senior Debt obligations
-Farm Credit Banks(formerly: Federal Land Banks, Federal
Intermediate Credit Banks and Banks for Cooperatives)
Consolidated system-wide bonds and notes
-Federal Home Loan Banks(FHL Banks)
Consolidated debt obligations
-Federal National Mortgage Association (FNMA)
Senior debt obligations
Mortgage-backed securities(excluded are stripped mortgage
securities which are purchased at prices exceeding their principal amounts)
-Student Loan Marketing Association (SLMA)
Senior debt obligations(excluded are securities that do not have a fixed
par value and/or whose terms do not promise a fixed dollar amount at
maturity or call date)
-Financing Corporation (FICO)
Debt obligations
-Resolution Funding Corporation (REFCORP)
Debt obligations
4. Unsecured certificates of deposit, time deposits, and bankers' acceptances (having maturities of not more
than 30 days)of any bank the short-term obligations of which are rated'A-1'or better by S&P.
5. Deposits the aggregate amount of which are fully insured by the Federal Deposit Insurance Corporation
(FDIC), in banks which have capital and surplus of at least$5 million.
• In the event an FPC is employed the Original Verification should also verify the adequacy of the FPC securities to
pay the portion of debt service on the Refunded Bonds to which the FPC relates.
L VegaNnunis\stalesWFL125503_N.doc
EXHIBIT E
Page 2 of 4
6. Commercial paper(having original maturities of not more than 270 days) rated'A-1+' by S&P and 'Prime-1' by
Moody's.
7. Money market funds rated'AAm' or'AAm-G'by S&P,or better.
8. "State Obligations",which means:
A. Direct general obligations of any state of the United States of America or any subdivision or
agency thereof to which is pledged the full faith and credit of a state the unsecured general
obligation debt of which is rated 'A3'by Moody's and 'A'by S&P, or better, or any obligation fully
and unconditionally guaranteed by any state, subdivision or agency whose unsecured general
obligation debt is so rated.
B. Direct general short-term obligations of any state agency or subdivision or agency thereof
described in(A)above and rated'A-1+'by S&P and'MIG-1'by Moody's.
C. Special Revenue Bonds (as defined in the United States Bankruptcy Code) of any state, state
agency or subdivision described in (A) above and rated 'AA'or better by S&P and 'Aa' or better
by Moody's.
9. Pre-refunded municipal obligations rated "AAA" by S & P and "Aaa" by Moody's meeting the following
requirements:
A. the municipal obligations are (1) not subject to redemption prior to maturity or(2) the trustee for
the municipal obligations has been given irrevocable instructions concerning their call and
redemption and the issuer of the municipal obligations has covenanted not to redeem such
municipal obligations other than as set forth in such instructions;
B. the municipal obligations are secured by cash or United States Treasury Obligations which may
be applied only to payment of the principal of, interest and premium on such municipal
obligations;
C. the principal of and interest on the United States Treasury Obligations (plus any cash in the
escrow) has been verified by the report of independent certified public accountants to be
sufficient to pay in full all principal of, interest, and premium, if any, due and to become due on
the municipal obligations("Verification");
D. the cash or United States Treasury Obligations serving as security for the municipal obligations
are held by an escrow agent or trustee in trust for owners of the municipal obligations;
E. no substitution of a United States Treasury Obligation shall he permitted except with another
United States Treasury Obligation and upon delivery of a new Verification; and
F. the cash or United States Treasury Obligations are not available to satisfy any other claims,
including those by or against the trustee or escrow agent.
10. Repurchase agreements:
With(1)any domestic bank, or domestic branch of a foreign bank,the long term debt of which is rated at least
"A° by S&P and Moody's; or (2) any broker-dealer with "retail customers" or a related affiliate thereof which
broker-dealer has, or the parent company (which guarantees the provider) of which has, long-term debt rated
at least "A' by S&P and Moody's, which broker-dealer falls under the jurisdiction of the Securities Investors
' In the event an FPC is employed the Original Verification should also verify the adequacy of the FPC securities to
pay the portion of debt service on the Refunded Bonds to which the FPC relates.
L:Uegal munisr stales lFLr2560 N doc
EXHIBIT E
Page 3 of 4
Protection Corporation; or(3) any other entity rated "A" or better by S&P and Moody's and acceptable to the
Insurer, provided that
A. The market value of the collateral is maintained at levels and upon such conditions as would be
acceptable to S & P and Moody's to maintain an "A" rating in an "A" rated structured financing
(with a market value approach);
B. The Paying Agent or a third party acting solely as agent therefor or for the Issuer(the "Holder of
the Collateral') has possession of the collateral or the collateral has been transferred to the
Holder of the Collateral in accordance with applicable state and federal laws (other than by
means of entries on the transferor's books);
C. The repurchase agreement shah state and an opinion of counsel shall be rendered at the time
such collateral is delivered that the Holder of the Collateral has a perfected first priority security
interest in the collateral,any substituted collateral and all proceeds thereof(in the case of bearer
securities,this means the Holder of the Collateral is in possession);
C. All other requirements of S&P in respect of repurchase agreements shall be met.
E. The repurchase agreement shall provide that if during its term the providers rating by either
Moody's or S&P is withdrawn or suspended or falls below "A-' by S&P or "A3" by Moody's, as
appropriate,the provider must, at the direction of the Issuer or the Paying Agent (who shall give
such direction if so directed by the Insurer), within 10 days of receipt of such direction,
repurchase all collateral and terminate the agreement, with no penalty or premium to the Issuer
or Paying Agent.
Notwithstanding the above, if a repurchase agreement has a term of 270 days or less (with no evergreen provision),
collateral levels need not be as specified in (A) above, so long as such collateral levels are 103%or better and the
provider is rated at least"A" by S&P and Moody's, respectively.
11. Investment agreements with a domestic or foreign bank or corporation (other than a life or properly casualty
insurance company) the long-term debt of which, or, in the case of a guaranteed corporation the long-term
debt, or, in the case of a monoline financial guaranty insurance company, claims paying ability, of the
guarantor is rated at least "AA" by S&P and "Aa" by Moody's; provided that, by the terms of the investment
agreement:
A. interest payments are to be made to the Paying Agent at limes and in amounts as necessary to
pay debt service (or, if the investment agreement is for the construction fund, construction
draws)on the Bonds;
B. the invested funds are available for withdrawal without penalty or premium, at any time upon not
more than seven days' prior notice; the Issuer and the Paying Agent hereby agree to give or
cause to be given notice in accordance with the terms of the investment agreement so as to
receive funds thereunder with no penalty or premium paid;
C. the investment agreement shall state that is the unconditional and general obligation of, and is
not subordinated to any other obligation of, the provider thereof or, if the provider is a bank, the
agreement or the opinion of counsel shall state that the obligation of the provider to make
payments thereunder ranks pari passu with the obligations of the provider to its other depositors
and its other unsecured and unsubordinated creditors;
In the event an FPC is employed the Original Verification should also verify the adequacy of the FPC securities to
pay the portion of debt service on the Refunded Bonds to which the FPC relates.
L VegaNnunisbtates1FL125603_N.doc
EXHIBIT E
Page 4 of 4
D. the Issuer or the Paying Agent receives the opinion of domestic counsel (which opinion shall be
addressed to the Issuer and the Insurer)that such investment agreement is legal, valid, binding
and enforceable upon the provider in accordance with its terms and of foreign counsel (if
applicable)in form and substance acceptable,and addressed to,the Insurer;
E. the investment agreement shall provide that if during its term
i) the provider's rating by either S&P or Moody's falls below "AA-" or "Aa3",
respectively, the provider shall, at its option, within 10 days of receipt of publication
of such downgrade, either CO collateralize the investment agreement by delivering
or transferring in accordance with applicable state and federal laws (other than by
means of entries on the providers books)to the Issuer,the Paying Agent or a third
party acting solely as agent therefor (the 'Holder of the Collateral") collateral free
and clear of any third-party liens or claims the market value of which collateral is
maintained at levels and upon such conditions as would be acceptable to S & P
and Moody's to maintain an "A" rating in an 'A" rated structured financing (with a
market value approach); or (ii) repay the principal of and accrued but unpaid
interest on the investment, and
ii) the providers rating by either S&P or Moody's is withdrawn or suspended or falls
below "A-"or"A3", respectively,the provider must, at the direction of the Issuer or
the Paying Agent (who shall give such direction if so directed by the Insurer),
within 10 days of receipt of such direction, repay the principal of and accrued but
unpaid interest on the investment, in either case with no penalty or premium to the
Issuer or Paying Agent, and
F. The investment agreement shall state and an opinion of counsel shall be rendered, in the event
collateral is required to be pledged by the provider under the terms of the investment
agreement, at the time such collateral is delivered, that the Holder of the Collateral has a
perfected first priority security interest in the collateral, any substituted collateral and all
proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in
possession);
G. the investment agreement must provide that if during its term
i) the provider shall default in its payment obligations, the provider's obligations
under the investment agreement shall, at the direction of the Issuer or the Paying
Agent (who shall give such direction if so directed by the Insurer), be accelerated
and amounts invested and accrued but unpaid interest thereon shall be repaid to
the Issuer or Paying Agent, as appropriate,and
ii) the provider shall become insolvent, not pay its debts as they become due, be
declared or petition to be declared bankrupt, etc. ("event of insolvency"), the
provider's obligations shall automatically be accelerated and amounts invested and
accrued but unpaid interest thereon shall be repaid to the Issuer or Paying Agent,
as appropriate.
• In the event an FPC is employed the Original Verification should also verify the adequacy of the FPC securities to
pay the portion of debt service on the Refunded Bonds to which the FPC relates.
L legato unis\states\FL\256O3_N.Ex
o
'� FSA
MUNICIPAL BOND DEBT SERVICE RESERVE
INSURANCE COMMITMENT
Issuer: City of Ocoee, Florida Date of Commitment: January 11, 1999
Bonds Insured: Capital Improvement Refunding Revenue Bonds,Series 1999
Premium: 2.10%of Policy Limit Expiration Date: Friday, March 12, 1999
Policy Limit: A dollar amount equal to the Reserve Account Requirement, as specified under the Resolution
FINANCIAL SECURITY ASSURANCE INC. ("Financial Security"), a stock insurance company, hereby commits to
issue its Municipal Bond Debt Service Reserve Insurance Policy(the "Reserve Policy"), in the form attached hereto
as Exhibit A, relating to the above-described debt obligations (the 'Bonds"), subject to the terms and conditions
contained herein or added hereto. All terms used herein and not otherwise defined shall have the meanings
ascribed to them in the document setting forth the security for and authorizing the issuance of the Bonds (the
'Resolution').
To keep this Commitment in effect after the Expiration Date set forth above,a request for renewal must be submitted
to Financial Security prior to such expiration date. Financial Security reserves the right to refuse wholly or in pan to
grant a renewal. To keep the Commitment in effect to the Expiration Date set forth above, Financial Security must
receive a duplicate of this Commitment executed by an appropriate officer of the Issuer by the date which is ten days
from the date of this Commitment.
THE RESERVE POLICY SHALL BE ISSUED UPON SATISFACTION OF THE FOLLOWING CONDITIONS:
1. The documents to be executed and delivered in connection with the issuance and sale of the Bonds shall not
contain any untrue or misleading statement of a material fact and shall not fail to state a material fact
necessary in order to make the information contained therein not misleading.
2. No event shall occur which would permit any purchaser of the Bonds, otherwise required, not to be required to
purchase the Bonds on the date scheduled for the issuance and delivery thereof.
3. There shall be no material change in or affecting the Bonds (including, without limitation, the security for the
Bonds) or the financing documents or the Official Statement (or any similar disclosure documents) to be
executed and delivered in connection with the issuance and sale of the Bonds from the descriptions or forms
thereof approved by Financial Security.
4. Financial Security shall be provided with:
(a) A letter from Bryant, Miller&Olive, P.A. ("Bond Counsel") addressed to Financial Security to the effect
that Financial Security may rely on the approving opinion(s) of Bond Counsel as if such opinion(s) were
addressed to Financial Security.
(b) An opinion(s) of Bond Counsel, addressed to and in form and substance satisfactory to Financial
Security, as to the(i)due authorization,validity and enforceability of the authorizing document, the Insurance
Agreement and the document which incorporates the requirements set forth in Paragraph 5 hereof and(ii)the
perfection of the security interests created thereunder.
(c) Evidence of wire transfer in federal funds in an amount equal to the insurance premium, unless
alternative arrangements for the payment of such amount acceptable to Financial Security have been made
prior to the delivery date of the Reserve Policy.
Page 1 of 3
5. The Resolution shall include the following terms and conditions and shall be in farm and substance
acceptable to Financial Security:
(a) The Issuer shall repay any draws under the Reserve Policy and pay all related reasonable expenses
incurred by Financial Security. Interest shall accrue and be payable on such draws and expenses from the
date of payment by Financial Security at the Late Payment Rate. "Late Payment Rate" means the lesser of
(a) the greater of (i) the per annum rate of interest, publicly announced from time to time by The Chase
Manhattan Bank at its principal office in the City of New York, as its prime or base lending rate("Prime Rate")
(any change in such Prime Rate to be effective on the date such change is announced by The Chase
Manhattan Bank) plus 3%, and (li) the then applicable highest rate of interest on the Bonds and (b) the
maximum rate permissible under applicable usury or similar laws limiting interest rates. The Late Payment
Rate shall be computed on the basis of the actual number of days elapsed over a year of 360 days. In the
event The Chase Manhattan Bank ceases to announce its Prime Rate publicly, Prime Rate shall be the
publicly announced prime or base lending rate of such national bank as Financial Security shall specify.
Repayment of draws and payment of expenses and accrued interest thereon at the Late Payment Rate
(collectively, "Policy Costs") shall commence in the first month following each draw, and each such monthly
payment shall be in an amount at least equal to 1/12 of the aggregate of Policy Costs related to such draw.
Amounts in respect of Policy Costs paid to Financial Security shall be credited first to interest due, then
to the expenses due and then to principal due. As and to the extent that payments are made to Financial
Security on account of principal due, the coverage under the Reserve Policy will be increased by a like
amount,subject to the terms of the Reserve Policy.
All cash and investments in the debt service reserve fund established for the Bonds (the "Reserve
Fund")shall be transferred to the debt service fund for payment of debt service on Bonds before any drawing
may be made on the Reserve Policy or any other credit facility credited to the Reserve Fund in lieu of cash
("Credit Facility). Payment of any Policy Costs shall be made prior to replenishment of any such cash
amounts. Draws on all Credit Facilities (including the Reserve Policy) on which there is available coverage
shall be made on a pro-rata basis (calculated by reference to the coverage then available thereunder) after
applying all available cash and investments in the Reserve Fund. Payment of Policy Costs and
reimbursement of amounts with respect to other Credit Facilities shall be made on a pro-rata basis prior to
replenishment of any cash drawn from the Reserve Fund.
(b) If the Issuer shall fail to pay any Policy Costs in accordance with the requirements of Paragraph 5(a)
hereof, Financial Security shall be entitled to exercise any and all legal and equitable remedies available to it,
including those provided under the Resolution other than (i) acceleration of the maturity of the Bonds or (ii)
remedies which would adversely affect owners of the Bonds.
(c) The Resolution shall not be discharged until all Policy Costs owing to Financial Security shall have
been paid in lull. The Issuers obligation to pay such amounts shall expressly survive payment in full of the
Bonds.
(d) In order to secure the Issuer's payment obligations with respect to the Policy Costs there shall be
granted and perfected in favor of Financial Security a security interest(subordinate only to that of the owners
of the Bonds) in all revenues and collateral pledged as security for the Bonds.
(e) The Resolution shall require the Trustee to ascertain the necessity for a claim upon the Reserve Policy
and to provide notice to Financial Security in accordance with the terms of the Reserve Policy at least five
business days prior to each date upon which interest or principal is due on the Bonds. Where deposits are
required to be made by the Issuer with the Trustee to the debt service fund for the Bonds more often than
semi-annually,the Trustee shall be instructed to give notice to Financial Security of any failure of the Issuer to
make timely payment in full of such deposits within two business days of the date due.
Page 2 of 3
6. The Reserve Policy shall expire on the earlier of the date the Bonds are no longer outstanding and the final
maturity dale of the Bonds.
7. The Issuer shall deliver to Financial Security an executed Insurance Agreement in substantially the farm of
Exhibit B hereto.
8. Any official statement or similar disclosure document relating to the Bonds shall contain only such references
to the Reserve Policy and Financial Security as we shall supply or approve.
9. Financial Security shall insure the Bonds pursuant to its Commitment Letter dated January 11. 1999.
10. Promptly after the issuance of the Reserve Policy, Financial Security shall receive a complete set of executed
documents implementing the requirements of this Commitment.
FINANCIAL SECURITY ASSURANCE INC.
Authorized Officer
To keep this commitment in effect to the Expiration Date set forth on the first page, Financial Security must receive
by the date which is ten days from the date of this Commitment a duplicate of this Commitment executed by an
appropriate officer of the Issuer.
The undersigned agrees that it the debt service reserve fund requirement for the Bonds is met in whole or in part by
credit instrument,such credit instrument shall be a Reserve Policy provided by Financial Security in accordance with
the terms of this Commitment. The undersigned further acknowledges and agrees that execution of the Resolution
constitutes an express instruction by the undersigned to legal counsel to deliver to Financial Security the opinions
required by paragraph 4 hereof (such instruction and opinion delivery requirements being a condition precedent to
issuance of the Reserve Policy hereunder).
Accepted as of , 1999 by City of Ocoee, Florida.
BY:
Title:
Page 3 of 3
WY%:.M�•Y:=V{i:F 'WF cis a ' y{'�M +I`M pa ,4€.1! .YV �YuV` �Y`►' a ,e .
}
5l OF
5 )£
.; U•1 FINANCIAL x
C �r� ASSURANCE.
MUNICIPAL BOND DEB -SERVICE >,
RESERVE INSURANC OLICY
'' % ISSUER: Policy No. R ,
l
:
,t t;, BONDS: $ in aggregate ptlndpal amount of /^J EReye pate: t
N 4 V (�
,r; cum $ 4.i'„
jy on Date
"i. FINANCIAL SECURITY ASSURANCE INC. ('Fnanda Secu' id- . .• received, hereby v �
(.t. I UNCONDRIONALLY AND IRREVOCABLY agrees to pay to the • -- (the -• • •r paying agent (the t t .
V':� Payingas set forth in the documentation (the "Bond r•.. nl') • • •1 , r the Issuance of and .rh'
only to Me
e Ii Ihereto),that paten of the principal naBonds, for the benefit of the Owners, nd In eresi �t of• this •-•Du Payment
but shall be unpaid by reason a Nonpayment try tlhe Issuer. �
'T Financial Security will make payment as provided In this •• I•aging Agent on the later of the " '
Business Day on whi h such t7dndpal and interest . . Due ,F'�"'a P& the Bustrhess Day red following •
al the Business Day on which Fuhehdal Scanty shall - N. onpaynient In a faro reasonably t
e h `t.5 satisfactory to IL A Notice of Nonpayment will be - on a .-y. Business Day If t Is received prior i•" i
i �I to 1:00 p.m.(New York lime)on such Business Da . otherwise, I he .-- -• received on the next Business
,(t{s Day. lf any Notice of Nonpayment retched by F . `•- Security Is •`•npiete, It shall be deemed not to have r fl ,t
\ • been received by Financial Security for . •. IT .- .- and Financial Security shall promptly 7
,,',,j{, so advise the Trustee, Paying Agent or I _ ... .. e, • may submit an amended Notice of �•�, •.�,\)
I/;j.,(fi Nonpayment Payment by Financial -. • ' I - iustee Pa •Agent for the benefit of the Owners shall,to "•/Y�� - the extent thereof,discharge the manual under this Policy. Upon such payment,Financial
/'b Security shall become entitled a.-• • t-• of the so paid (together with Merest and expenses) .I})"'4y.
t(,1•Oi pursuant to the T:••`Y
v `D The amount available under this Pol.. r .. - : •f exceed the Policy Limit The amount available at any (i
particular lime to be paid to the T - ,re :. 7 under the terms of this Percy shall automatically be
x „- reduced by any payment under after such payment,the amount available under this Policy
/; shall be reinstated h full or kin yy�y. Policy Limit to the extent of the reimbursement of such ,t})�
'� y payment(exclusive of - Staidly by or on behalf of the Issuer. Within twee r.te'��
,.-- Bus'vress Days of such I _. •. shall provide the Trustee, the Paying Agent and the N..
�(;h Issuer with notice of the . _ _ f =/
3' Payment under this P. : : .,. : with respect to (a) any Nonpayment that occurs prior to the ,.
f t 7 Effective Date or a " .0r. r . a this Policy or(b)Bonds that are not outstanding under the Bond t € +•
`3 Document If the :.y under , • Policy Is also payable wider another Insurance policy or suety bond �
Insuring the :. shall be made under Ills Policy to the extent of the amount available under this
(( 7 Policy up to • : n no event shall Financial Secretly bar duplicate lability for the same amounts ;[� r
) owing with —! ,.1 ,. am covered under this Policy and any other Insurance policy or surety bond
I that Financial h j
N. S
r- Except S. ed ,• . . •.died by an endorsement hereto,the following terms shall have the meanings
Oi a,• Policy. *Business Day'means any day other than(a)a Saturday or Sunday or rr£h g
'� 5 a . Institutions in the State a New Yak are,«the Insurer's Fiscal Agent Is, authorized or
�(;� - - �5r . order to remain dosed. 'Due for Payment'means(a)when r.fa,Ii to the principal A
� `§• of a .• .T` stated maturity date fl,erea«tlie date on write be same shall have been duty Sled t ( v'
�} } redemption and does not refer b any earlier date on which payment is due by reason .y)
%i:. of al for wawa." (other than by mandatory sinld g fund redemption),acoelemton re other advancement of
((;` mabaiy ' Seas* shall red. t: Its sole diisaetion, to pay such pdndpal due upon such !,
r accelereiorh with any r7oaued Merest win:
lima date a eaaeleatlorh and N)when refeni g to interest one z..
Bond, payable on the stated date for payment of Interest insurance Agreement' means the Insurance .'4i- ?,
I._%. ,�, '„ t. '�" h at' ,
} '` !^ A .....„.�`,:I V`W V' iS „�V' .!'�• ,7/:, „,tie• t/`I`:.�1,44 ....A tY r. ...q .,
Page 2 of
v'i Policy Noe „ y
p t €s
r Agreement dated as of the effective date hereof in respect of this Policy, as the same be amended or �.,y .,,
P(;t supplemented from time to time. 'Nonpayment" means, in respect of a Bond, the failure the Issuer to hay It}lt,
/'^-. provided sufficient funds to the Paying Agent for payment In full of all principal and interest rue for Payment .a ,,,k
r'` on such Bond. 'Nonpayment"shall also include,in respect of a Bond,any payment of •- opal o •t' ;st that is "?,
F\4 1 Due for Payment made to an Owner by or on behalf of the Issuer that has been from ' er I Sr' �"
pursuant to the United States Bankruptcy Code by a trustee In bankruptcy ,�•ance with final, k-e.ge
(Cf nonappealable order of a court having competent jurisdiction. 'Notice" means t• - ! • ' S 1 i-• notice' t
f- ?y ) subsequently confirmed in a signed writing, or written notice by registered or uer, the
� Trustee or the Paying Agent to Financial Security which notice shall specify ( the •- .• r en ng the
, ,,,- claim, (b) the Policy Number, (c) the claimed amount and (d) the date such • amoun me Due for t
Payment "Ovme.a means,in respect of a Bond,the person or entity who, •the t • Nonpa ent,is entitled .44
under the terms of such Bond to payment of principal or interest thereund• - pt that ', .hall not include
;(() the Issuer or any person or entity whose direct or Indirect obligation ••nstit ute e unde•ti g security for the f);ts 's
VVI- Bonds. "Policy LkNC shall be the dollar amount of the debt service fund req -• to •- maintained for the �'.'
✓ 34 Bonds by the Bond Document from lime to lime(the"Dolt Service R-.. rRequirenne V.but h no event shall ! 4\
+ ) the P Limit exceed 5(211. The Poi Unit shall automatically . . re• .m be red . • from lime to time by Ir ' z'
r
_ the amount of each reduction in the Debt Service Reserve Rega, �'�.• in - Bond Document ',7r'+"
-' f Financial Security a fiscal agent(the"Insurer's J rposes of t is Policy by gmng �`r
I mayrs appointt..x
� written ratite to the Trustee and the Paying Agent �•• 1 address of the Insurer's Fiscal ��....,,
- 7 Agent From and after the date of receipt of such t the Trost-. Paying Agent (a)copies of ell Pr[^g
+ �,:y,7. notices required to be delivered to Financial •'-. • this Pot• • -I be sir ✓
1\ (( Secarity . simultaneously deliveredydt d
fil theQ,) Insurer'sym ns re Agent and to made
by Security e•• shall not • _ received unto received by both and 'r
l-✓ (b)all y payments required to be made by Financial --- - under PP:y e• cy may be made directly by Financial t ( ,
�`�`,` Security or by the Insurers Fiscal Agent on behalf. Security. - Insurer's Fiscal Agent is the agent of I •
..).{�r-� Financial Security only and the Insurers Fiscal>> — - In • • liable to any Owner for any act of the '„ K,
Jr,:��Y�.� Insurer's Focal Agent or any(allure of F - to • •• . •r cause to be deposited sufficient funds to t 71 j
/ make payments due under this Policy. -.
m{ ` ! To the fWest extent per mtted by appfi•:• , law, -ndal ^ +, agrees not to assert.and hereby waives only $
\� for the benefit of each Owner,all rights ether by -• rtn, setoff or e rend defenses(including,eextentx,' _
%�'� without imitation,the defense of fro - acq - -• •rsut to n,assignment or itsobligations
otherwise,to the
v _! that such rights and defenses may • . Security to avoid payment of obligations under this ` ,°
Policy In accordance with the r slonso t • •obey. .,,,
••,;..• �!', This Policy sets forth in full , - Security,and shall not be modified,altered or affected by el ce
ram/. any other agreement or - - modification or amendment thereto. Except to the extent �„��,x;
! expressly modified by an = •- ill— any premium paid in respect of this Policy is nonrefundable for fe'€ -)
any reason whatsoever.Intl • • being made for payment of the Bonds prior to maturity j
• +ft and (b) this. Policy be 1, .�.•• or revoked. THIS POLICY IS NOT COVERED BY THE 1,
(,; ! PROPERTY/CA.S GE RRY FUND SPECIFIED IN ARTICLE 76 OF THE NEW YORK L l
INSURANCE LAW ��}) ti,\
lti(;' In wit -witness • SECURITY ASSURANCE INC. has caused this Policy to be executed on Its £ `)
YY behalfby its • r' • `>%
t [Countersi lure] FINANCIAL SECURITY ASSURANCE INC
1
x
c: By By $ su,
Authorized Officer t)�
`(.z� A su idiar)r Fin al Security Assurance Holdings Ltd. (212)826-0100 F'`�.K
l/-.; 350 Pa w York,N.Y. 10022-6022 tie t
)r: /I s
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EXHIBIT B
INSURANCE AGREEMENT
INSURANCE AGREEMENT, dated as January _, 1999 by and between City of Ocoee, Florida (the
"Issuer')and Financial Security Assurance Inc. (the"Insurer')(the"Agreement").
In consideration of the issuance by the Insurer of its Municipal Bond Debt Service Reserve Insurance Policy
(the"Reserve Policy')with respect to the Issuers Capital Improvement Refunding Revenue Bonds, Series 1999(the
"Bonds")issued under Resolution No.99- , adopted by the City Commission of the Issuer on January , 1999,
as amended and supplemented (collectively, the "Resolution") and the Issuer's payment to the Insurer of the
insurance premium for the Reserve Policy, the Insurer and the Issuer hereby covenant and agree as follows:
1. Upon any payment by the Insurer under the Reserve Policy, the Insurer shall furnish to the Issuer
written instructions as to the manner in which payment of amounts owed to the Insurer as a result
of such payment under the Reserve Policy shall be made.
2. The Issuer shall pay the Insurer the principal amount of any draws under the Reserve Policy and
pay all related reasonable expenses incurred by the Insurer and shall pay interest thereon from the
date of payment by Financial Security at the Late Payment Rate. "Late Payment Rate" means the
lesser of (a)the greater of (i) the per annum rate of interest, publicly announced from time to time
by The Chase Manhattan Bank at its principal office in the City of New York, as its prime or base
lending rate ("Prime Rate") (any change in such Prime Rate to be effective on the date such
change is announced by The Chase Manhattan Bank)plus 3%, and(li)the then applicable highest
rate of interest on the Bonds and (b) the maximum rate permissible under applicable usury or
similar laws limiting interest rates. The Late Payment Rate shall be computed on the basis of the
actual number of days elapsed over a year of 360 days. In the event The Chase Manhattan Bank
ceases to announce its Prime Rate, the Prime Rate shall be the prime or base lending rate of such
national bank as the Insurer shall designate.
3. Repayment of draws and payment of expenses and the interest accrued thereon at the Late
Payment Rate(collectively, "Policy Costs')shall commence in the first month following each draw,
and each such monthly payment shall be in an amount at least equal to 1/12th of the aggregate of
Policy Costs related to such draw.
4. Amounts in respect of Policy Costs paid to the Insurer shall be credited first to interest due,then to
the expenses due and then to principal due.
5. As and to the extent that payments are made to the Insurer on account of principal due, the
coverage under the Reserve Policy will be increased by a like amount, subject to the terms of the
Reserve Policy.
6. All cash and investments in the Reserve Fund shall be transferred to the debt service fund for
payment of debt service on the Bonds before any drawing may be made on the Reserve Policy or
on any alternative credit instrument. Payment of any Policy Costs shall be made prior to
replenishment of any such cash amounts. Draws on all alternative credit instruments (including
the Reserve Policy) on which there is available coverage shall be made on a pro rata basis
(calculated by reference to coverage then available under each such alternative credit instrument)
after applying available cash and investments in the Reserve Fund. Payment of Policy Costs and
reimbursement of amounts with respect to alternative credit instruments shall be made on a pro-
rate basis prior to replenishment of any cash drawn from the Reserve Fund.
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7. If the Issuer shall fail to pay any Policy Costs in accordance with the requirements of the
Resolution and this Agreement, the Insurer shall be entitled to exercise any and all legal and
equitable remedies available to it, including those provided under the Resolution, other than (i)
acceleration of the maturity of the Bonds or (ii) remedies which would adversely affect owners of
the Bonds.
8. The Resolution shall not be discharged until all Policy Costs owing to the Insurer shall have been
paid in full. The Issuer's obligation to pay such amounts shall expressly survive payment in full of
the Bonds.
9. In order to secure the Issuers payment obligations with respect to the Policy Costs, there is
hereby granted and perfected in favor of the Insurer a security interest(subordinate only to that of
the owners of the Bonds)in all revenues and collateral pledged as security for the Bonds.
10. The Trustee shall ascertain the necessity for a claim upon the Reserve Policy and provide notice
to the Insurer in accordance with the terms of the Reserve Policy at least five business days prior
to each date upon which interest or principal is due on the Bonds. Where deposits are required to
be made by the Issuer with the Trustee to the debt service fund for the Bonds more often than
semi-annually, the Trustee shall give notice to the Insurer of any failure of the Issuer to make
timely payment in full of such deposits within two business days of the date due.
11. Notices to the Insurer shall be sent to the following address (or such other address as the Insurer
may designate in writing): Financial Security Assurance Inc., 350 Park Avenue, New York, New
York 10022-6022 Attention: Managing Director-Surveillance.
12. This Agreement may be executed in counterparts, each of which alone and all of which together
shall be deemed one original Agreement.
13. If any one or more of the agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such agreements, provisions or terms shall be deemed
severable from the remaining agreements, provisions or terms of this Agreement and shall in no
way affect the validity or enforceability of the other provisions of this Agreement.
14. All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to
them in the Resolution.
15. This Agreement and the rights and obligations of the parties of the Agreement shall be governed
by and construed and interpreted in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have set their hands as of the date written above.
CITY OF OCOEE, FLORIDA FINANCIAL SECURITY ASSURANCE INC.
By: By:
Title: Title:
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