HomeMy WebLinkAboutResolution 98-13
RESOLUTION NO. 98-13
A RESOLUTION OF THE CITY COMMISSION OF THE CITY
OF OCOEE, FLORIDA, PROVIDING FOR THE
CONSTRUCTION AND ACQUISITION OF CERTAIN
IMPROVEMENTS TO THE TRANSPORTATION SYSTEM OF
THE CITY OF OCOEE, FLORIDA; PROVIDING FOR THE
REFUNDING OF CERTAIN OF THE CITY'S
TRANSPORTATION REFUNDING AND IMPROVEMENT
REVENUE BONDS, SERIES 1990, AUTHORIZING THE
ISSUANCE BY THE CITY OF NOT TO EXCEED $19,500,000
TRANSPORTATION REFUNDING AND IMPROVEMENT
REVENUE BONDS, SERIES 1998, TO FINANCE THE COST
THEREOF; PLEDGING REVENUES DERIVED FROM THE
LOCAL OPTION GAS TAX, THE PUBLIC SERVICE TAXES
AND CERTAIN INVESTMENT EARNINGS TO SECURE
PAYMENT OF THE PRINCIPAL OF AND INTEREST ON SUCH
SERIES 1998 BONDS ON PARITY WITH THE CITY'S
OUTSTANDING PARITY BONDS; AMENDING CERTAIN
TERMS RELATING TO THE RELEASE OF THE LIEN ON THE
PUBLIC SERVICE TAX; AUTHORIZING THE EXECUTION OF
A CONTINUING DISCLOSURE CERTIFICATE; MAKING
CERTAIN COVENANTS AND AGREEMENTS FOR THE
BENEFIT OF THE HOLDERS OF SUCH BONDS; PROVIDING
FOR SEVERABILITY OF INVALID PROVISIONS;
AUTHORIZING THE PREPARATION OF A PRELIMINARY
OFFICIAL STATEMENT; DESIGNATING MBIA INSURANCE
CORPORATION AS THE BOND INSURER FOR THE SERIES
1998 BONDS; PROVIDING FOR THE REPEAL OF ANY
RESOLUTIONS IN CONFLICT WITH THE PROVISIONS OF
TillS RESOLUTION; PROVIDING CERTAIN OTHER MATTERS
IN CONNECTION THEREWITH; AND PROVIDING AN
EFFECTIVE DATE.
BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE,
FLORIDA:
ARTICLE I
GENERAL
SECTION 1.01. Authority for this Resolution. This Resolution is adopted pursuant
to the provisions of the Constitution of the State of Florida, the Charter of the City ofOcoee, Chapter
166, Part n, Florida Statutes, Resolution 90-08, as amended and supplemented by Resolution 90-11
of the City ofOcoee, and other applicable provisions of law.
SECTION 1.02. Definitions. When used in this Resolution, capitalized terms not
otherwise defined shall be as defined in Resolution 90-08, as amended and supplemented by
Resolution 90-11 of the Issuer, and the following terms shall have the following meanings, unless the
context clearly otherwise requires.
"Additional 1998 Project" shall mean the acquisition, construction or reconstruction of rights-
of-way, design, construction, paving and improvement of certain streets, intersections and drainage
improvements within and without the corporate limits of the Issuer 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 is financed from the Series 1998 Bonds,
as more fully described in the plans on file with the Issuer.
"Bond Insurer" shall mean, with respect to the Series 1998 Bonds, l\1BIA Insurance
Corporation, a stock insurance company.
"Continuing Disclosure Certificate" shall mean that certain Continuing Disclosure Certificate
related to the Series 1998 Bonds to be executed by the Issuer prior to the time the Issuer delivers the
Series 1998 Bonds to the underwriter or underwriters, as it may be amended from time to time in
accordance with the terms thereof, whereby the Issuer undertakes to assist the underwriter or
underwriters in complying with the continuing disclosure requirements of the Continuing Disclosure
Rule, in substantially the form attached hereto as Exhibit B.
"Continuing Disclosure Rule" shall mean the continuing disclosure requirements of Rule 15c2-
12 of the United States Securities and Exchange Commission, as amended.
"Escrow Agent" shall mean a bank with trust powers or a trust company selected and named
by the City Manager as a party to the Escrow Deposit Agreement prior to the sale of the Series 1998
Bonds, together with any successors and assigns.
"Escrow Deposit Agreement" shall mean an agreement or agreements by and between the
Issuer and an Escrow Agent, the purpose of which is to provide for the payment of the Refunded
Series 1990 Bonds. Such agreement shall be in substantially the form attached hereto as Exhibit A
and incorporated herein by reference.
"Municipal Bond Insurance Policy" shall mean the municipal bond insurance policy issued by
the Bond Insurer insuring the payment when due of the principal of and interest on the Series 1998
Bonds as provided therein.
"Original Instrument" shall mean Resolution No. 90-08 adopted by the City Commission on
August 21, 1990, as supplemented and amended by Resolution No. 90-11 adopted by the City
Commission on August 30, 1990.
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"Outstanding Series 1990 Bonds" shall mean the portion of the Issuer's Transportation
Refunding and Improvement Revenue Bonds, Series 1990, which remain outstanding as Parity Bonds
after the issuance of the Series 1998 Bonds.
"Parity Bonds" shall mean the Outstanding Series 1990 Bonds.
"Preliminary Official Statement" shall mean the Preliminary Official Statement relating to the
Series 1998 Bonds attached hereto as Exhibit C.
"Refunded Series 1990 Bonds" shall mean the portion of the Issuer's Transportation
Refunding and Improvement Revenue Bonds, Series 1990 refunded with the proceeds of the Series
1998 Bonds.
"Reserve Requirement" means with respect to the Series 1998 Bonds the lesser of (i) the
Maximum Bond Service Requirement, (ii) 125% of the average annual Bond Service Requirement
or (iii) the maximum amount as shall not adversely effect the exclusion of interest on any Bonds from
Federal income tax purposes, to the extent the interest thereon was intended to be excluded for such
purposes.
"Series 1998 Bonds" shall mean the Series 1998 Bonds, herein authorized to be issued on
parity with the Outstanding Series 1990 Bonds.
"Supplemental 1998 Resolution" shall mean this resolution of the Issuer supplementing the
Original Instrument adopted and becoming effective in accordance with the terms of Section 26(F)
of the Original Instrument.
"Surety Bond" shall mean the surety bond issued by the Bond Insurer for the Series 1998
Bonds, guaranteeing certain payments into the Reserve Account with respect to the Series 1998
Bonds as provided therein and subject to the limitations set forth therein.
SECTION 1.03. Resolution to Constitute Contract. In consideration of the purchase
and acceptance of any or all of the Series 1998 Bonds by those who shall hold the same from time
to time, the provisions of this Resolution and the Original Instrument shall be deemed to be and shall
constitute a contract between the Issuer and the Holders from time to time of the Series 1998 Bonds.
The pledge made in this Resolution and the provisions, covenants and agreements herein set forth and
in the Original Instrument 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 Series 1998 Bonds. All of the Series
1998 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 Series 1998 Bonds over any other thereof
except as expressly provided in or pursuant to this Resolution.
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SECTION 1.04.
Findings. It is hereby ascertained, determined and declared that:
(A) The Issuer owns and maintains certain streets, roads, and associated transportation
facilities within its corporate limits.
(B) The Issuer deems it necessary, desirable and in the best interests of the Issuer and the
residents thereof that the Additional 1998 Project be acquired, constructed and erected.
(C) The Additional 1998 Project shall be financed with the proceeds of the Series 1998
Bonds, together with certain other legally available funds ofthe Issuer.
(D) No portion of the Public Service Taxes and Local Option Gas Tax are pledged or
encumbered in any manner, except with respect to the payment of the Parity Bonds.
(E) 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 Additional 1998
Project.
(F) The Issuer deems it necessary, beneficial and in its best interest to provide for the
refunding of the Refunded Series 1990 Bonds. Such refunding will be advantageous to the Issuer
because it will allow the Issuer to provide for debt service savings.
(G) The estimated sum required for the refunding of the Refunded Bonds will be derived
from a portion of the proceeds of the sale of the Series 1998 Bonds, together with certain other
legally available funds of the Issuer.
(H) A portion of the proceeds of the Series 1998 Bonds shall be deposited with the Escrow
Agent pursuant to the Agreement, in amounts which, together with earnings thereon, will be sufficient
to make timely payments of the interest on and outstanding principal of the Refunded Bonds to their
scheduled redemption date. Such funds shall be invested pursuant to the Agreement in such
investments as will be sufficient to pay such principal and interest.
(I) The principal of and interest on the Series 1998 Bonds and all other payments provided
for in this Resolution will be paid solely from the Public Service Taxes and Local Option Gas Tax;
and the ad valorem taxing power of the Issuer will never be necessary or authorized to pay the
principal of, premium, if any, and interest on the Series 1998 Bonds and the Series 1998 Bonds shall
not constitute a lien upon any property of the Issuer other than the Pledged Funds.
(1) 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 in accordance with the requirements of the Charter of the Issuer.
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SECTION 1.05. Additional 1998 Project; Refunding of Refunded Series 1990
Bonds. The Issuer does hereby authorize the acquisition, construction and erection of the Additional
1998 Project and the refunding of the Refunded Series 1990 Bonds in accordance herewith.
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ARTICLE II
AUTHORIZATION, TERMS, EXECUTION
AND REGISTRATION OF SERIES 1998 BONDS
SECTION 2.01. Authorization of Series 1998 Bonds. This Resolution creates an issue
of Series 1998 Bonds of the Issuer to be designated as "City of Ocoee, Florida, Transportation
Refunding and Improvement Revenue Bonds". The aggregate principal amount of the Series 1998
Bonds which maybe executed and delivered under this Resolution shall not exceed $19,500,000. The
Series 1998 Bonds are issued as Additional Parity Obligations on parity with Parity Bonds and are
entitled to the full benefit and security of the Original Instrument as Bonds issued thereunder.
The Series 1998 Bonds 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. In no event shall the rate of interest
on the Series 1998 Bonds exceed the maximum rate permitted by law.
The Series 1998 Bonds shall be dated such date; 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.
The Series 1998 Bonds shall be issued in fully registered form without coupons; may be issued
as Term and/or Serial Bonds; may be Term Capital Appreciation Bonds and/or Current Interest
Bonds; shall be numbered consecutively from R-1 upward if Current Interest Bonds; shall be
numbered from CABR-1 upward if Capital Appreciation Bonds; shall be in the denomination of
$5,000 each, or integral multiples thereof for the Current Interest Bonds and in $5,000 maturity
amounts for the Capital Appreciation Bonds or in $5,000 multiples thereof, or such other
denominations as shall be approved by the Issuer in a supplemental resolution prior to the delivery
of the Series 1998 Bonds; and shall mature on such dates in such years and amounts as will be fixed
by supplemental resolution of the Issuer prior to or upon the sale of the Series 1998 Bonds.
Each Series 1998 Current Interest Bond shall bear interest from the interest payment date next
preceding the date on which it is authenticated, unless authenticated on an interest payment date, in
which case it shall bear interest from such interest payment date, or, unless authenticated prior to the
first interest payment date, in which case it shall bear interest from its date; provided, however, that
if on the date of authentication payment of any interest which is due and payable has not been made,
such Series 1998 Current Interest Bond shall bear interest from the date which interest has been paid.
Any Series 1998 Capital Appreciation Bonds shall bear interest only at maturity or upon
redemption prior to maturity in the amount determined by reference to the Compounded Amounts.
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The principal of and the interest and redemption premium, if any, on the Series 1998 Bonds
shall be payable in any coin or currency of the United States of America which on the respective dates
of payment thereof is legal tender for the payment of public and private debts. The interest on the
Series 1998 Current Interest Bonds shall be payable by the Paying Agent on each interest payment
date to the person appearing, as of the fifteenth day of the calendar month immediately preceding
such interest payment date (the "Record Date"), on the registration books of the Issuer hereinafter
provided for as the Holder thereof, by check or draft mailed to such Holder at his address as it
appears on such registration books, or at the request and expense ofa registered owner of$I,OOO,OOO
or more of Series 1998 Bonds, by wire transfer or other medium acceptable to the Issuer and Paying
Agent. Payment of the principal of all Series 1998 Current Interest Bonds and the Compounded
Amount with respect to the Series 1998 Capital Appreciation Bonds shall be made upon the presen-
tation and surrender at the office of the Paying Agent of such Series 1998 Bonds as the same shall
become due and payable.
SECTION 2.02. Application of Series 1998 Bond Proceeds. Except as otherwise
provided by supplemental resolution of the Issuer, the proceeds derived from the sale of the Series
1998 Bonds, including accrued interest and premium, if any, shall, simultaneously with the delivery
of the Series 1998 Bonds to the purchaser or purchasers thereof, be applied by the Issuer as follows:
(A) Accrued interest, ifany, 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 1998 Bonds.
(B) A sufficient amount of the Series 1998 Bond proceeds shall be applied to the payment
of reasonable and necessary costs and expenses relating to delivery of the Series 1998 Bonds,
including the premium for municipal bond insurance and the Surety Bond to the Bond Insurer.
(C) Unless otherwise provided in a supplemental resolution of the Issuer prior to the issuance
of the Series 1998 Bonds, the Reserve Requirement for the Series 1998 Bonds shall be established
and deposited in a subaccount in the Reserve Account for the benefit of the Series 1998 Bonds by
the deposit of the Surety Bond as permitted by Section 18 B.(1)(d) of the Original Instrument.
(D) A sum as specified by a supplemental resolution of the Issuer shall, together with other
legally available funds of the Issuer, if any, be used to defease the Refunded Series 1990 Bonds by
depositing such sums of money for investment in appropriate Acquired Obligations pursuant to the
Escrow Deposit Agreement so as to produce sufficient funds to make all the payments described in
such Escrow Deposit Agreement. At the time of execution of such Escrow Deposit Agreement, the
Issuer shall furnish to the Escrow Agent named therein appropriate documentation to demonstrate
that the sums being deposited and the investment to be made will be sufficient for such purposes.
Simultaneously with the issuance of the Series 1998 Bonds, the Issuer shall enter into an Escrow
Deposit Agreement substantially in the form attached hereto as Exhibit A with the Escrow Agent.
Such escrowed funds shall be kept separate and apart from all other funds of the Issuer and the
moneys on deposit under the Escrow Deposit Agreement shall be withdrawn, used and applied by the
Escrow Agent solely for the purposed set forth in the Escrow Deposit Agreement.
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(E) The remainder of the proceeds of the Series 1998 Bonds after providing for the payments
required by (A), (B), (C) and (D) above shall be deposited into the "City ofOcoee Transportation
Refunding and Improvement Revenue Bond Construction Fund" which fund is hereby created and
established and shall be used to acquire, construct and erect the Additional 1998 Project.
SECTION 2.03 Funds and Accounts Secure Holders of the Series 1998 Bonds;
Reserve Fund; Surety Bond. The funds and accounts created pursuant to Section 18 of the Original
Instrument shall be for the equal benefit and use of the Series 1998 Bonds as Additional Parity
Obligations, provided, however, that the account in the Reserve Account established for a particular
Series of Bonds solely secures such Series of Bonds. The deposits required in Section 18 of the
Original Instrument shall be calculated commencing with the month in which the Series 1998 Bonds
are delivered to provide for such deposits to reflect the issuance of the Series 1998 Bonds.
To the extent funds are deposited in the account of the Reserve Account such moneys shall
be invested in Investment Securities maturing not later than the maturity date of the Series 1998
Bonds, and such securities shall be valued at cost.
SECTION 2.04. Execution of Series 1998 Bonds. The Series 1998 Bonds shall be
signed by or bear the facsimile signatures of the Mayor and the Clerk and a facsimile or an original
impression of the official seal of the Issuer shall be imprinted on the Series 1998 Bonds.
In case any officer whose signature or a facsimile of whose signature shall appear on any
Series 1998 Bond shall cease to be such officer before the delivery of such Series 1998 Bond, such
signature or such facsimile shall nevertheless be valid and sufficient for all purposes the same as ifhe
has remained in office until such delivery. Any Series 1998 Bond may bear the original or facsimile
signature of such persons who, on the date of the execution of such Series 1998 Bond, shall be the
proper officers to sign such Series 1998 Bond although on the delivery date of such Series 1998 Bond
such persons may not have been such officers.
SECTION 2.05. Authentication. Only such of the Series 1998 Bonds as shall have
endorsed thereon a certificate of authentication substantially in the form hereinbelow set forth, duly
executed by the Registrar, as authenticating agent, shall be entitled to any benefit or security under
this Resolution and the Original Instrument. No Series 1998 Bond shall be valid or obligatory for any
purpose unless and until such certificate of authentication shall have been duly executed by the
Registrar, and such certificate of the Registrar upon any such Series 1998 Bond shall be conclusive
evidence that such Series 1998 Bond has been duly authenticated and delivered under this Resolution.
The Registrar's certificate of authentication on any Series 1998 Bond shall be deemed to have been
duly executed if signed by an authorized officer of the Registrar, but it shall not be necessary that the
same officer sign the certificate of authentication of all of the Series 1998 Bonds that may be issued
hereunder at anyone time.
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SECTION 2.06. Privilege of Redemption. The Issuer shall have the right to redeem
any or all of the Series 1998 Bonds in whole or in part, as shall be determined by supplemental
resolution of the Issuer prior to the issuance of the Series 1998 Bonds.
SECTION 2.07. Form of Series 1998 Bonds. The text of the Series 1998 Bonds,
together with the certificate of authentication, shall be in substantially the form of the Series 1990
Bonds as set forth in Section 15 of the Original Instrument with such omissions, insertions and
variations as may be necessary and/or desirable to recite the details of the Series 1998 Bonds as
Additional Parity Obligations and approved by the Mayor prior to the issuance thereof (which
necessity and/or desirability and approval shall be presumed by the Issuer's delivery of the Series 1998
Bonds to the purchaser or purchasers thereof).
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ARTICLE III
REGISTRAR, PAYING AGENT, INSURER,
AND ACCOUNTANT MATTERS
SECTION 3.01. Registrar and Paying Agent for the Series 1998 Bonds. The
Registrar and Paying Agent for the Series 1998 Bonds shall be appointed by the City Manager prior
to the issuance of the Series 1998 Bonds; and the Mayor and the Clerk are hereby authorized to
execute and deliver on behalf of the Issuer a registrar and paying agency agreement in a form which
shall be approved by the Issuer's attorney.
SECTION 3.02. Preparation of Accountant's Certificate. Prior to the issuance of
the Series 1998 Bonds, the accounting firm of McDirmit, Davis, Lauteria & Co., as independent
certified public accountants shall prepare and file the certificates required by Section 18 D (1) and (2)
of the Original Instrument, in order to issue the Series 1998 Bonds as Additional Parity Obligations
under the Original Instrument.
SECTION 3.03. Appointment of Bond Insurer for Series 1998 Bonds. The Bond
Insurer for the Series 1998 Bonds shall be MBIA Insurance Corporation.
SECTION 3.04. Purchase of Bond Insurance and Surety Bond. The purchase ofa
Municipal Bond Insurance Policy from the Bond Insurer to irrevocably guarantee the payment of
principal and interest on the Series 1998 Bonds is hereby authorized in accordance with the terms of
the Commitment for the Municipal Bond Insurance Commitment attached hereto as Exhibit D. The
purchase of the Surety Bond from the Bond Insurer is hereby authorized.
The Issuer is hereby authorized and directed to purchase a Surety Bond from the Bond
Insurer (the "Surety Bond") relating to the Series 1998 Bonds to be deposited in the subaccount of
the Reserve Account, and payment for such Surety Bond to the Bond Insurer is hereby authorized
from Series 1998 Bond proceeds. The Issuer hereby authorizes the execution of the Reserve Fund
Guaranty Agreement with the Bond Insurer (the "Reserve Fund Agreement") in the form attached
as Exhibit E relating to the issuance of the Surety Bond for the Reserve Fund in conjunction with the
issuance of the Series 1998 Bonds and to deliver said Reserve Fund Agreement to the Bond Insurer,
and does hereby direct the execution and delivery of said Reserve Fund Agreement. All of the
provisions of said Reserve Fund Agreement, when executed and delivered by the Issuer as authorized
herein and when duly authorized, executed and delivered by the Bond Insurer, shall be deemed to be
a part of this Resolution as fully and to the same extent as if incorporated verbatim in the appropriate
sections. The terms and conditions contained in the Original Instrument relating to the surety bond
issued by the Bond Insurer for the Series 1990 Bonds, including the provisions of Section 18B( 1)( d)
shall also apply to the Surety Bond for the Series 1998 Bonds deposited pursuant to the terms hereof.
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SECTION 3.05. Terms Regarding Series 1998 Bonds In Policy. The Issuer hereby
covenants, represents, and expressly agrees to the following terms and provisions as such are
necessary and desirable in order to obtain the Municipal Bond Insurance Policy:
A. Consent of the Bond Insurer. Any provision of this Resolution or the Original
Instrument expressly recognizing or granting rights in or to the Bond Insurer may not be amended
in any manner which affects the rights of the Bond Insurer hereunder without the prior written
consent of the Bond Insurer.
B. Consent of the Bond Insurer in Addition to Bondholder Consent. Unless otherwise
provided in this Section, the Bond Insurer's consent shall be required in addition to Bondholder
consent for the following purposes: (i) execution and delivery of any supplemental resolution or any
amendment, supplement, change to or modification of this Resolution, (ii) removal of the Paying
Agent and selection and appointment of any successor paying agent for the Series 1998 Bonds; and
(iii) initiation or approval of any action not described in (i) or (ii) above which requires Bondholder
consent.
C. Consent of the Bond Insurer in the Event of Insolvency. Any reorganization or
liquidation plan with respect to the Issuer must be acceptable to the Bond Insurer. In the event of
any reorganization or liquidation, the Bond Insurer shall have the right to vote on behalf of all Series
1998 Bondholders who hold the Series 1998 Bonds which are insured by the Bond Insurer, absent
a default by the Bond Insurer under the applicable Municipal Bond Insurance Policy insuring such
Series 1998 Bonds or under the Surety Bond deposited in the Reserve Fund.
D. Consent of the Bond Insurer upon Default. Anything in this Resolution to the contrary
notwithstanding, upon the occurrence and continuance of an event of default as defined in the
Original Instrument, the Bond Insurer shall be entitled to control and direct the enforcement of all
rights and remedies granted to the Series 1998 Bondholders for the benefit of the Series 1998
Bondholders under this Resolution and Original Instrument.
E. Notification and Documents to be Furnished. While the Municipal Bond Insurance
Policy is in effect, the Issuer shall furnish to the Bond Insurer (to the attention of the Surveillance
Department, unless otherwise indicated) with a copy to Standard & Poor's Rating Services:
(i) as soon as practicable after the filing thereof, a copy of any financial statement of the
Issuer and a copy of any audit and annual report of the Issuer;
(ii) a copy of any notice to be given to the registered owners of the Series 1998 Bonds,
including, without limitation, notice of any redemption or defeasance of the Series 1998 Bonds, and
any certificate rendered pursuant to this Resolution or relating to the security for the Series 1998
Bonds;
(iii) such additional information it may reasonably request;
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(iv) notice of any failure of the Issuer to provide relevant notices, certificates, etc.; and
(v) immediate notification if, at any time (a) there are insufficient moneys to make any
payments of principal of or interest on the Series 1998 Bonds, as required, and (b) upon the
occurrence of any event of default.
F. Access to Issuer Information. The Issuer will permit the Bond Insurer to discuss the
affairs, financings and accounts of the Issuer or any information the Bond Insurer may reasonably
request regarding the security for the Series 1998 Bonds with appropriate officers of the Issuer. The
Issuer will permit the Bond Insurer to have access to the Additional 1998 Project and to have access
to and make copies of all books and records relating to the Series 1998 Bonds at any reasonable time.
G. Right to Direct an Accounting. The Bond Insurer shall have the right to direct an
accounting at the Issuer's expense, and the Issuer's failure to comply with such direction within thirty
(30) days after receipt of written direction from the Bond Insurer shall be deemed a default hereunder;
provided, however, that if compliance cannot occur within such period, then such period will be
extended so long as compliance is begun within such period and diligently pursued, but only if such
extension would not materially adversely affect the interests of any registered owner of the Series
1998 Bonds.
I. Payment Procedure. As long as the Municipal Bond Insurance Policy shall be in full
force and effect, the Issuer and the Paying Agent agree to comply with the following provisions:
(a) At least one (1) business day prior to all interest payment dates, the Paying Agent will
determine whether there will be sufficient funds in the funds and accounts to pay the principal of or
interest on the Series 1998 Bonds on such interest payment date. If the Paying Agent determines that
there will be insufficient funds in such funds or accounts, the Paying Agent shall so notify the Bond
Insurer. Such notice shall specify the amount of the anticipated deficiency, the Series 1998 Bonds
to which such deficiency is applicable and whether such Series 1998 Bonds will be deficient as to
principal, or interest, or both. The Bond Insurer will make payments of principal or interest due on
the Series 1998 Bonds on or before the first (1st) day next following the date on which the Bond
Insurer shall have received notice of nonpayment from the Paying Agent.
(b) The Paying Agent shall, after giving notice to the Bond Insurer as provided in (a)
above, make available to the Bond Insurer and, at the Bond Insurer's direction, to the United States
Trust Company of New York, as insurance trustee for the Bond Insurer or any successor insurance
trustee (the "Insurance Trustee"), the registration books of the Issuer maintained by the Paying Agent
and all records relating to the funds and accounts maintained under the Original Instrument or this
Resolution.
(c) The Paying Agent shall provide the Bond Insurer and the Insurance Trustee with a list
of registered owners of Series 1998 Bonds entitled to receive principal or interest payments from the
Bond Insurer under the terms of the Municipal Bond Insurance Policy, and shall make arrangements
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with the Insurance Trustee (i) to mail checks or drafts to the registered owners of Series 1998 Bonds
entitled to receive full or partial interest payments from the Bond Insurer and (ii) to pay principal
upon Series 1998 Bonds surrendered to the Insurance Trustee by the registered owners of Series
1998 Bonds entitled to receive full or partial principal payments from the Bond Insurer.
(d) The Paying Agent shall, at the time it provides notice to the Bond Insurer pursuant
to ( a) above, notify registered owners of Series 1998 Bonds entitled to receive the payment of
principal or interest thereon from the Bond Insurer (i) as to the fact of such entitlement, (ii) that the
Bond Insurer will remit to them all or a part of the interest payments next coming due upon proof of
Bondholder entitlement to interest payments and delivery to the Insurance Trustee, in form
satisfactory to the Insurance Trustee, of an appropriate assignment of the registered owner's right to
payment, (iii) that should they be entitled to receive full payment of principal from the Bond Insurer,
they must surrender their Series 1998 Bonds (along with an appropriate instrument of assignment in
form satisfactory to the Insurance Trustee to permit ownership of such Series 1998 Bonds to be
registered in the name of the Bond Insurer) for payment to the Insurance Trustee, and not the Paying
Agent, and (iv) that should they be entitled to receive partial payment of principal from the Bond
Insurer, they must surrender their Series 1998 Bonds for payment thereon first to the Paying Agent
who shall note on such Series 1998 Bonds the portion of the principal paid by the Paying Agent, if
any, and then, along with an appropriate instrument of assignment in form satisfactory to the
Insurance Trustee, to the Insurance Trustee, which will then pay the unpaid portion of principal.
( e) In the event that the Paying Agent has notice that any payment of principal of or
interest on a Series 1998 Bond which has become due for payment and which is made to a
Bondholder by or on behalf of the Issuer has been deemed a preferential transfer and theretofore
recovered from its registered owner pursuant to the United States Bankruptcy Code by a trustee in
bankruptcy in accordance with the final, nonappealable order of a court having competent
jurisdiction, the Paying Agent shall, at the time the Bond Insurer is notified pursuant to (a) above,
notify all registered owners that in the event that any registered owner's payment is so recovered, such
registered owner will be entitled to payment from the Bond Insurer to the extent of such recovery if
sufficient funds are not otherwise available, and the Paying Agent shall furnish to the Bond Insurer
its records evidencing the payments of principal of and interest on the Series 1998 Bonds which have
been made by the Paying Agent and subsequently recovered from registered owners and the dates on
which such payments were made.
(t) In addition to those rights granted to the Bond Insurer under this Resolution and the
Original Instrument, the Bond Insurer shall, to the extent it makes payment of principal of or interest
on Series 1998 Bonds, become subrogated to the rights of the recipients of such payments in
accordance with the terms of the Municipal Bond Insurance Policy, and to evidence such subrogation
(i) in the case of subrogation as to claims for past due interest, the Paying Agent shall note the Bond
Insurer's rights as subrogee on the registration books of the Issuer maintained by the Paying Agent
upon receipt from the Bond Insurer of proof of the payment of interest thereon to the registered
owners of the Series 1998 Bonds, and (ii) in the case of subrogation as to claims for past due
principal, the Paying Agent shall note the Bond Insurer's rights as subrogee on the registration books
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of the Issuer maintained by the Paying Agent upon surrender of the Series 1998 Bonds by the
registered owners thereof together with proof of the payment of principal thereof
K. The Bond Insurer as Third Party Beneficiary. To the extent that the Resolution or the
Original Instrument confers upon or gives or grants to the Bond Insurer any right, remedy or claim
under or by reason of this Resolution or the Original Instrument, the Bond Insurer is hereby explicitly
recognized as being a third-party beneficiary and may enforce any such right, remedy or claim
conferred, given or granted.
L. Parties Interested Herein. Nothing in this Resolution or expressed or implied is
intended or shall be construed to confer upon, or to give or grant to, any person or entity, other than
the Issuer, the Bond Insurer, the Paying Agent, and the registered owners of the Bonds, any right,
remedy or claim under or by reason of this Resolution or any covenant, condition or stipulation
hereof, and all covenants, stipulations, promises and agreements in this Resolution or the Original
Instrument contained by and on behalf of the Issuer shall be for the sole and exclusive benefit of the
Issuer, the Bond Insurer, the Paying Agent and the registered owners of the Series 1998 Bonds.
M. Defeasance Provisions. Notwithstanding anything in the Resolution to the contrary,
in the event that the principal and/or interest due on the Series 1998 Bonds shall be paid by the Bond
Insurer pursuant to the Municipal Bond Insurance Policy, the Series 1998 Bonds shall remain
Outstanding for all purposes, not be defeased or otherwise satisfied and not be considered paid by
the Issuer, and the assignment and pledge of the security for the Series 1998 Bonds and all covenants,
agreements and other obligations of the Issuer to the registered owners shall continue to exist and
shall run to the benefit of the Bond Insurer, and the Bond Insurer shall be subrogated to the rights
of such registered owners.
SECTION 3.06.
Federal Income Tax Covenants.
(A) The Issuer covenants with the Holders of the Series 1998 Bonds (other than taxable
bonds), that it shall not use the proceeds of such Series 1998 Bonds in any manner which would cause
the interest on such Series 1998 Bonds to be or become includable in the gross income of the Holder
thereof for federal income tax purposes.
(B) The Issuer covenants with the Holders of the Series 1998 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 the Series 1998 Bonds (or amounts deemed to be proceeds under the Code) in any
manner which would cause the Series 1998 Bonds to be "arbitrage bonds" within the meaning of
Section 148 of the Code and neither the Issuer nor any other Person shall do any act or fail to do any
act which would cause the interest on the Series 1998 Bonds to become includable in the gross
income of the Holder thereof for federal income tax purposes.
(C) The Issuer hereby covenants with the Holders of the Series 1998 Bonds (other than
taxable bonds) that it will comply with all provisions of the Code necessary to maintain the exclusion
14
of interest on the Series 1998 Bonds from the gross income of the Holder 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.
15
ARTICLE IV
AMENDMENT TO ORIGINAL INSTRUMENT
SECTION 4.01. Amendment to Original Instrument. Notwithstanding the provisions
of Section 18(K) of the Original Instrument, the Issue shall not be entitled to exercise any right to
release the lien on the Public Service Taxes unless or until the Issuer's right to levy and receive the
Local Option Gas Tax shall be extended to at least the maturity date of all Bonds then outstanding.
16
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Preliminary Official Statement. The preparation of a Preliminary
Official Statement in the form attached as Exhibit C relating to the Series 1998 Bonds is hereby
authorized in such form and substance as shall be approved by the Mayor of the Issuer. The Mayor
and the City Manager are hereby authorized to deem such Preliminary Official Statement as "final"
within the meaning of Rule 15c-2-12 of the Securities and Exchange Commission, except for certain
"permitted omissions" as defined in such rule.
SECTION 5.02. Continuing Disclosure. The Issuer hereby covenants and agrees that,
in order to assist the underwriter or underwriters in complying with the Continuing Disclosure Rule
with respect to the Series 1998 Bonds, it will comply with and carry out all of the provisions of the
Continuing Disclosure Certificate to be executed by the Issuer prior to the time the Issuer delivers
the Series 1998 Bonds to the underwriter or underwriters, as it may be amended from time to time
in accordance with the terms thereof The Continuing Disclosure Certificate, substantially in the form
attached hereto as Exhibit B, is hereby approved and ratified. Notwithstanding any other provision
of this Resolution, failure of the Issuer to comply with such Continuing Disclosure Certificate shall
not be considered an Event of Default hereunder. However, the Continuing Disclosure Certificate
shall be enforceable by the Series 1998 Bondholders in the event that the Issuer fails to cure a breach
thereunder within a reasonable time after written notice from a Series 1998 Bondholder to the Issuer
that a breach exists. Any rights of the Series 1998 Bondholders to enforce the provisions of the
covenant shall be on behalf of all Series 1998 Bondholders and shall be limited to a right to obtain
specific performance of the Issuer's obligations thereunder.
SECTION 5.03. Severability of Invalid Provisions. If anyone 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, or shall in any manner adversely affect the
validity of the Series 1998 Bonds, 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 Series 1998 Bonds issued hereunder.
17
SECTION 5.04. Effective Date. This Resolution shall take effect immediately upon
its adoption.
DUL Y ADOPTED this (~~ day of September, 1998.
CITY COMMISSION OF THE CITY
OF OCOEE, FLORIDA
(SEAL)
c::::"?
By: ;:)
Name: S. Scott Vandergrift
Title: Mayor
ATTEST:
FOR USE AND RELIANCE ONLY
BY THE CITY OF OCOEE,
APPROVED AS TO FORM AND
LEGALITY, THIS I S ~
DAY OF SEPTEMBER, 1998
APPROVED BY THE OCOEE CITY
COMMISSION AT A MEETING HELD
ON SEPTEMBER tL 1998 UNDER
AGENDA ITEM NO. VI Ii
FOLEY & LARDNER
FOR USE AND RELIANCE ONLY
BY THE CITY OF OCOEE,
APPROVED AS TO FORM AND
LEGALITY, THIS \ S~
DAY OF SEPTEMBER, 1998.
By (/J~~
Name: P oJ I ~, (to SGt'\ ~,
Title: City Attorney
BRYANT, MILLER AND OLIVE, P.A.
J :\BONDS\4203\RES03.wPD
September 9. 1998
By:J)~ ?~
Grace E. Dunlap
Bond Counsel
18
EXHffiIT A
ESCROW DEPOSIT AGREEMENT
ESCROW DEPOSIT AGREEMENT
THIS ESCROW DEPOSIT AGREEMENT, dated as of 1, 1998, by and
between the CITY OF OCOEE, FLORIDA (the "Issuer"), and
, a national banking association organized under the laws of the United
States of America, as Escrow Agent, and its successors and assigns (the "Escrow Agent");
WIT N E SSE T H:
WHEREAS, the Issuer has previously authorized and issued Transportation Refunding and
Improvement Revenue Bonds, Series 1990 outstanding as of the date of delivery of the Bonds (as
hereinafter defined) in the principal amount of $ which mature in the years _ through
(the "Refunded Bonds"), as to which the Total Debt Service for the Refunded Bonds (as
hereinafter defined) is set forth on Schedule A; and
WHEREAS, the Issuer has determined to provide for payment of the Total Debt Service for
the Refunded Bonds by depositing with the Escrow Agent an amount which, together with investment
earnings thereon, is at least equal to such Total Debt Service for the Refunded Bonds; and
WHEREAS, in order to obtain the funds needed for such purpose, the Issuer has authorized
and is, concurrently with the delivery of this Agreement, issuing its Transportation Refunding and
Improvement Revenue Bonds, Series 1998; and
WHEREAS, the execution of this Escrow Deposit Agreement and full performance of the
provisions hereof shall defease and discharge the Issuer's obligations relating to the Refunded Bonds;
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the Issuer and the Escrow Agent agree as follows:
SECTION 1. Definitions. As used herein, the following terms mean:
(a) "Agreement" means this Escrow Deposit Agreement.
(b) "Annual Debt Service" means the principal, interest, and redemption premium, if any, on
the Refunded Bonds coming due in a particular year as shown on Schedule A attached hereto and
made a part hereof.
(c) "Bonds" means the $ City ofOcoee, Florida, Transportation Refunding and
Improvement Revenue Bonds, Series 1998, issued under the Resolution.
(d) "Escrow Account" means the account hereby created and entitled Escrow Account
established and held by the Escrow Agent pursuant to this Agreement in which cash and investments
will be held for payment of the principal, interest, and redemption premium, if any, on the Refunded
Bonds as they become due and payable.
(e) "Escrow Agent" means
corporate trust office in
, having its designated
, Florida, and its successors and assigns.
(t) "Federal Securities" means any bonds or other obligations which, as to principal and
interest, constitute direct obligations of, or are unconditionally guaranteed as to full and timely
payment by, the United States of America, none of which permit redemption or prepayment at the
option of the United States of America prior to the dates on which such Federal Securities are
scheduled to mature pursuant to Schedule C attached hereto. The term "Federal Securities" shall not
include money market funds or mutual funds invested in obligations described in this definition.
(g) "Issuer" means the City of Ocoee, Florida, and its successors and assigns.
(h) "Refunded Bonds" means the Issuer's Transportation Refunding and Improvement
Revenue Bonds, Series 1990 outstanding as of the delivery date of the Bonds in the principal amount
of $ maturing in the years _ through _'
(i) "Resolution" means Resolution No. 90-08, as amended and supplemented by Resolution
No. 90-11 and Resolution No. 98-_, authorizing the issuance of the Bonds.
(j) "Total Debt Service for the Refunded Bonds" means, as of any date, the sum of the
principal of, redemption premium, if any, and interest remaining unpaid with respect to the Refunded
Bonds in accordance with Schedule A attached hereto.
SECTION 2. Deposit of Funds. The Issuer hereby deposits $ with the
Escrow Agent for deposit into the Escrow Account, in immediately available funds, which funds the
Escrow Agent acknowledges receipt of, to be held in irrevocable escrow by the Escrow Agent
separate and apart from other funds of the Escrow Agent and applied solely as provided in this
Agreement. $ of such funds are being derived from proceeds of the Bonds.
of such funds are being derived from the Reserve Account (as that term is defined in
the Resolution) related to the Refunded Bonds. The Issuer represents that the Federal Securities, the
interest to be earned thereon, and the cash deposited to the Escrow Account (i) are at least equal to
the Total Debt Service for the Refunded Bonds as of the date of such deposit, and (ii) are sufficient
to pay principal, interest and redemption premium on the Refunded Bonds as they become due and
payable in accordance with Schedule A attached hereto.
SECTION 3. Use and Investment of Funds. The Escrow Agent acknowledges receipt of the
sum described in Section 2 and agrees:
(a) to hold the funds and investments purchased pursuant to this Agreement in irrevocable
escrow during the term of this Agreement for the sole benefit of the holders of the Refunded Bonds;
(b) to immediately invest $ of such funds derived from the proceeds of the
Bonds and other legally available funds of the Issuer in the Federal Securities set forth on Schedule
2
C attached hereto and to hold such securities and $ of such funds in cash in accordance with the
terms of this Agreement;
( c) in the event the securities described on Schedule C cannot be purchased, substitute
securities may be purchased with the consent of the Issuer but only upon receipt of verification from
an independent certified public accountant that the Federal Securities, the interest to be earned
thereon, and the cash deposited in the Escrow Account will not be less than the Total Debt Service
for the Refunded Bonds, and only upon receipt of an opinion of Bryant, Miller and Olive, P.A. that
such securities constitute Federal Securities for purposes of this Agreement; and
(d) there will be no investment offunds except as set forth in this Section 3 and except as set
forth in Section 5.
SECTION 4. Payment of Bonds and Expenses.
(a) Refunded Bonds. On the dates and in the amounts set forth on Schedule A, the Escrow
Agent shall transfer to , the Paying Agent for the Refunded Bonds
(the "Paying Agent"), in immediately available funds solely from amounts available in the Escrow
Account, a sum sufficient to pay that portion of the Annual Debt Service for the Refunded Bonds
coming due on such dates, as shown on Schedule A.
(b) Expenses. The Issuer shall pay the fees and expenses of the Escrow Agent as set forth
on Schedule B attached hereto.
( c) Surplus. After making the payments from the Escrow Account described in Subsections
4(a) and (b) above, the Escrow Agent shall retain in the Escrow Account any remaining cash in the
Escrow Account in excess of the Total Debt Service for the Refunded Bonds until the termination
of this Agreement pursuant to the terms of Section 13 hereof, and shall then pay any remaining funds
to the Issuer.
(d) Priority of Payments. The holders of the Refunded Bonds shall have an express first
priority security interest in the funds and Federal Securities in the Escrow Account until such funds
and Federal Securities are used and applied as provided in this Agreement.
SECTION 5. Reinvestment. (a) Except as provided in Section 3 and in this Section, the
Escrow Agent shall have no power or duty to invest any funds held under this Agreement or to sell,
transfer or otherwise dispose of or make substitutions of the Federal Securities held hereunder.
(b) At the written request of the Issuer and upon compliance with the conditions hereinafter
stated, the Escrow Agent shall sell, transfer or otherwise dispose of any of the Federal Securities
acquired hereunder and shall substitute other Federal Securities and reinvest any excess receipts in
Federal Securities. The Issuer will not request the Escrow Agent to exercise any of the powers
described in the preceding sentence in any manner which will cause interest on the Bonds to be
3
included in the gross income of the holders thereof for purposes of Federal income taxation. The
transactions may be effected only if (i) an independent certified public accountant selected by the
Issuer shall certify or opine in writing to the Issuer and the Escrow Agent that Federal Securities,
interest to be earned thereon, and cash remaining on hand after the transactions are completed will,
assuming no reinvestment or any earnings, be not less than the Total Debt Service for the Refunded
Bonds, and that reinvestment in such Federal Securities will not postpone the anticipated transfer of
moneys from the Escrow Account to the Paying Agent pursuant to Section 4(a) hereof, and (ii) the
Escrow Agent shall receive an opinion from a nationally recognized bond counsel acceptable to the
Issuer to the effect that the transactions, in and by themselves, will not cause interest on such Bonds
or the Refunded Bonds to be included in the gross income of the holders thereof for purposes of
Federal income taxation and such substitution is in compliance with this Agreement. Subsection 4(c)
above notwithstanding, cash in excess of the Total Debt Service for the Refunded Bonds caused by
substitution of Federal Securities shall, as soon as practical, be paid to the Issuer. Notwithstanding
any provision of this Agreement to the contrary, no forward purchase agreement relating to the future
reinvestment of cash held hereunder shall be executed unless the following condition is met: to the
extent either Moody's Investors Service, Inc., Fitch IBCA, Inc., and/or Standard & Poor's Ratings
Services have an outstanding rating on the Refunded Bonds, at least one of such rating agencies must
give written confirmation that it will not lower or withdraw the rating as a result of the Issuer's
execution of such forward purchase agreement. In the event of any inconsistency between the terms
and conditions of such forward purchase agreement and this Agreement, the terms and conditions of
this Agreement shall control.
SECTION 6. Redemption or Acceleration of Maturity. The Issuer will not accelerate the
maturity of, or exercise any option to redeem before maturity, any Refunded Bonds, except as set
forth on Schedule A attached hereto.
SECTION 7. Indemnity. To the extent permitted by law and without waiving sovereign
immunity, the Issuer hereby assumes liability for, and hereby agrees to indemnify, protect, save and
keep harmless, the Escrow Agent and its respective successors, assigns, agents and servants, from
and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs,
expenses and disbursements (including reasonable legal fees and disbursements) of whatsoever kind
and nature which may be imposed on, incurred by, or asserted against at any time, the Escrow Agent
(whether or not also indemnified against the same by the Issuer or any other person under any other
agreement or instrument) and in any way relating to or arising out of the execution and delivery of
this Agreement, the establishment of the Escrow Account established hereunder, the acceptance of
the funds and securities deposited therein, the purchase of the Federal Securities, the retention of the
Federal Securities or the proceeds thereof and any payment, transfer or other application of funds or
securities by the Escrow Agent in accordance with the provisions of this Agreement; provided, how-
ever, that the Issuer shall not be required to indemnify the Escrow Agent against its own negligence
or willful misconduct. In no event shall the Issuer be liable to any person by reason of the trans-
actions contemplated hereby other than to the Escrow Agent as set forth in this Section. The
indemnities contained in this Section shall survive the termination of this Agreement. The Escrow
Agent shall not be liable for any deficiencies in the amounts necessary to pay the Total Debt Service
4
for the Refunded Bonds. Furthermore, the Escrow Agent shall not be liable for the accuracy of the
calculation as to the sufficiency of moneys and the principal amount of Federal Securities and the
earnings thereon to pay the Total Debt Service for the Refunded Bonds.
SECTION 8. Responsibilities of Escrow Agent. The Escrow Agent and its respective
successors, assigns, agents and servants shall not be held to any personal liability whatsoever, in tort,
contract, or otherwise, in connection with the execution and delivery of this Agreement, the
establishment of the Escrow Account, the acceptance of the funds deposited therein, the purchase of
the Federal Securities, the retention of the Federal Securities or the proceeds thereof or for any
payment, transfer or other application of moneys or securities by the Escrow Agent in accordance
with the provisions of this Agreement or by reason of any non-negligent or non-willful act, omission
or error of the Escrow Agent made in good faith in the conduct of its duties. The Escrow Agent
shall, however, be responsible for its negligent or willful failure to comply with its duties required
hereunder, and its negligent or willful acts, omissions or errors hereunder. The duties and obligations
of the Escrow Agent may be determined by the express provisions of this Agreement. The Escrow
Agent may consult with counsel, who mayor may not be counsel to the Issuer, at the Issuer's
expense, and in reliance upon the opinion of such counsel, shall have full and complete authorization
and protection in respect of any action taken, suffered or omitted by it in good faith in accordance
therewith. Whenever the Escrow Agent shall deem it necessary or desirable that a matter be proved
or established prior to taking, suffering or omitting any action under this Agreement, such matter may
be deemed to be conclusively established by a certificate signed by an authorized officer of the Issuer.
SECTION 9. Resignation of Escrow Agent. The Escrow Agent may resign and thereby
become discharged from the duties and obligations hereby created, by notice in writing given to the
Issuer, any rating agency then providing a rating on either the Refunded Bonds or the Bonds, and the
Paying Agent for the Refunded Bonds not less than sixty (60) days before such resignation shall take
effect. Such resignation shall not take effect until the appointment of a new Escrow Agent hereunder.
SECTION 10. Removal of Escrow Agent.
(a) The Escrow Agent may be removed at any time by an instrument or concurrent
instruments in writing, executed by the holders of not less than fifty-one percentum (51 %) in
aggregate principal amount of the Refunded Bonds then outstanding, such instruments to be filed with
the Issuer, and notice in writing given by such holders to the original purchaser or purchasers of the
Bonds and published by the Issuer once in a newspaper of general circulation in the territorial limits
of the Issuer, and in a daily newspaper or financial journal of general circulation in the City of New
y ork, New York, not less than sixty (60) days before such removal is to take effect as stated in said
instrument or instruments. A photographic copy of any instrument filed with the Issuer under the
provisions of this paragraph shall be delivered by the Issuer to the Escrow Agent.
(b) The Escrow Agent may also be removed at any time for any breach of trust or for acting
or proceeding in violation of, or for failing to act or proceed in accordance with, any provisions of
this Agreement with respect to the duties and obligations of the Escrow Agent by any court of
5
competent jurisdiction upon the application of the Issuer or the holders of not less than five
percentum (5%) in aggregate principal amount of the Bonds then outstanding, or the holders of not
less than five percentum (5%) in aggregate principal amount of the Refunded Bonds then outstanding.
( c ) The Escrow Agent may not be removed until a successor Escrow Agent has been
appointed in the manner set forth herein.
SECTION 11. Successor Escrow Agent.
(a) If, at any time hereafter, the Escrow Agent shall resign, be removed, be dissolved or
otherwise become incapable of acting, or shall be taken over by any governmental official, agency,
department or board, the position of Escrow Agent shall thereupon become vacant. If the position
of Escrow Agent shall become vacant for any of the foregoing reasons or for any other reason, the
Issuer shall immediately appoint an Escrow Agent to fill such vacancy and, upon such appointment,
all assets held hereunder shall be transferred to such successor. The Issuer shall either (i) publish
notice of any such appointment made by it once in each week for four (4) successive weeks in a
newspaper of general circulation published in the territorial limits of the Issuer and in a daily
newspaper or financial journal of general circulation in the City ofN ew York, New York, or (ii) mail
a notice of any such appointment made by it to the holders of the Refunded Bonds within thirty (30)
days after such appointment.
(b) At any time within one year after such vacancy shall have occurred, the holders of a
majority in principal amount of the Bonds then outstanding or a majority in principal amount of the
Refunded Bonds then outstanding, by an instrument or concurrent instruments in writing, executed
by either group of such bondholders and filed with the governing body of the Issuer, may appoint a
successor Escrow Agent, which shall supersede any Escrow Agent theretofore appointed by the
Issuer. Photographic copies of each such instrument shall be delivered promptly by the Issuer, to the
predecessor Escrow Agent and to the Escrow Agent so appointed by the Bondholders. In the case
of conflicting appointments made by the Bondholders under this paragraph, the first effective
appointment made during the one year period shall govern.
( c) If no appointment of a successor Escrow Agent shall be made pursuant to the foregoing
provisions of this Section, the holder of any Refunded Bonds then outstanding, or any retiring Escrow
Agent, may apply to any court of competent jurisdiction to appoint a successor Escrow Agent. Such
court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint
a successor Escrow Agent.
(d) Any corporation or association into which the Escrow Agent may be converted or
merged, or with which it may be consolidated, or to which it may sell or transfer its corporate trust
business and assets as a whole or substantially as a whole, or any corporation or association resulting
from any such conversion, sale, merger, consolidation or transfer to which it is a party, ipso facto,
shall be and become successor Escrow Agent hereunder and vested with all the trust, powers,
discretions, immunities, privileges and all other matters as was its predecessor, without the execution
6
or filing of any instrument or any further act, deed or conveyance on the part of any parties hereto,
anything herein to the contrary notwithstanding, provided such successor shall have reported total
capital and surplus in excess of$15,000,000, provided that such successor Escrow Agent assumes
in writing all the trust, duties and responsibilities of the Escrow Agent hereunder.
SECTION 12. Payment to Escrow Agent. The Escrow Agent hereby acknowledges that it
has agreed to accept compensation under the Agreement pursuant to the terms of Schedule B
attached hereto for services to be performed by the Escrow Agent pursuant to this Agreement, plus
out-of-pocket expenses to be reimbursed at cost from legally available funds of the Issuer. The
Escrow Agent shall not be compensated from amounts on deposit in the Escrow Account, and the
Escrow Agent shall have no lien or claim against funds in the Escrow Account for payment of
obligations due it under this Section.
SECTION 13. Term. This Agreement shall commence upon its execution and delivery and
shall terminate when the Refunded Bonds have been paid and discharged in accordance with the
proceedings authorizing the Refunded Bonds, except as provided in Section 7.
SECTION 14. Severability. If any one or more of the covenants or agreements provided in
this Agreement on the part of the Issuer or the Escrow Agent to be performed should be determined
by a court of competent jurisdiction to be contrary to law, notice of such event shall be sent to the
municipal bond insurer(s) for the Refunded Bonds, if any, as well as Moody's Investors Service, Inc.,
Fitch mCA, Inc. and Standard & Poor's Ratings Services (but only to the extent such agencies have
a rating outstanding on any of the Refunded Bonds), and while such covenant or agreements herein
contained shall be null and void, they shall in no way affect the validity of the remaining provisions
of this Agreement.
SECTION 15. Amendments to this Agreement. This Agreement is made for the benefit of
the Issuer and the holders from time to time of the Refunded Bonds and the Bonds and it shall not
be repealed, revoked, altered or amended in whole or in part without the written consent of all
holders of Refunded Bonds, the Escrow Agent and the Issuer; provided, however, that the Issuer and
the Escrow Agent may, without the consent of, or notice to, such holders, enter into such agreements
supplemental to this Agreement as shall not adversely affect the rights of such holders and as shall
not be inconsistent with the terms and provisions of this Agreement, for anyone or more of the
following purposes:
(a) to cure any ambiguity or formal defect or omission in this Agreement;
(b) to grant to, or confer upon, the Escrow Agent, for the benefit of the holders of the Bonds
and the Refunded Bonds any additional rights, remedies, powers or authority that may lawfully be
granted to, or conferred upon, such holders or the Escrow Agent; and
( c) to subject to this Agreement additional funds, securities or properties.
7
The Escrow Agent shall, at its option, be entitled to request, at the Issuer's expense, and rely
exclusively upon an opinion of nationally recognized attorneys on the subject of municipal bonds
acceptable to the Issuer with respect to compliance with this Section, including the extent, if any, to
which any change, modification, addition or elimination affects the rights of the holders of the
Refunded Bonds, or that any instrument executed hereunder complies with the conditions and
provisions of this Section. Prior written notice of such amendments, together with proposed copies
of such amendments, shall be provided to Moody's Investors Service, Inc., Fitch mCA, Inc., and
Standard & Poor's Ratings Services (but only to the extent such agencies have a rating outstanding
on any of the Refunded Bonds).
SECTION 16. Counterparts. This Agreement may be executed in several counterparts, all
or any of which shall be regarded for all purposes as one original and shall constitute and be but one
and the same instrument.
SECTION 17. Governing Law. This Agreement shall be governed by and construed under
the laws of the State of Florida.
[Remainder of page intentionally left blank]
8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their duly authorized officers and their corporate seals to be hereunto affixed and attested as of the
date first above written.
CITY OF OCOEE, FLORIDA
(SEAL)
ATTEST:
By:
Name: S. Scott Vandergrift
Title: Mayor
By:
Name: Jean Grafton
Title: Clerk
FOR USE AND RELIANCE ONLY
BY THE CITY OF OCOEE, APPROVED
AS TO FORM AND LEGALITY:
FOLEY & LARDNER
By:
Name:
Title: City Attorney
as Escrow Agent
(SEAL)
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
J :\BONDS\4203\EDAl.WPD
September 9.1998
9
Date
Principal
SCHEDULE A
TOTAL DEBT SERVICE
Redemption
Premium
Interest
Total Debt
Service
SCHEDULE B
PAYMENTS TO BE MADE TO ESCROW AGENT
One time upfront fee of $_ at closing plus out-of-pocket expenses not to exceed
$
Maturity Date
SCHEDULE C
SCHEDULE OF FEDERAL SECURITIES
Principal Amount
Interest Rate
~
EXHffiIT B
FORM OF CONTINUING DISCLOSURE CERTIFICATE
EXHffiIT C
PRELIMINARY OFFICIAL STATEMENT
PRELIMINARY OFFICIAL STATEMENT DATED AS OF SEPTEMBER -' 1998
NEW ISSUE
RATINGS: S&P: "_"
Fitch: " "
(MBIA Insured)
(See "Ratings" herein)
In the opinion of Bond Counsel, assuming compliance by the City with certain covenants in the herein
described Resolution, interest on the Seri~ 1998 Bonds is excluded from gross income for purposes of Federal income
taxation and the Series 1998 Bonds are exempt from all present intangible personal property taxes imposed pursuant
to Chapter 199, Florida Statutes. See, however, "TAX EXEMPTION" herein for a description of certain Federal
minimum and other special taxes that may affect the tax treatment of interest on the Series 1998 Bonds.
$
CITY OF OCOEE, FLORIDA
Transportation Refunding and Improvement Revenue Bonds,
Series 1998
.
Dated: October 1, 1998
Due: October 1
(See inside cover)
The City of Ocoee, Florida Transportation Refunding and Improvement Revenue Bonds, Series 1998 (the
"Series 1998 Bonds") are being issued by the City of Ocoee, Florida (the "City") in fully registered form, without
coupons, in denominations of $5,000 or integral multiples thereof. The principal and the premium, if any, on the
Series 1998 Bonds will be payable upon surrender of the Series 1998 Bonds at the designated corporate office of
, , Florida, as Registrar and Paying Agent, or its successors. Interest on
the Series 1998 Bonds is payable semi-annually beginning on April 1, 1999 and on each October 1 and April 1
thereafter by check or draft mailed by the Paying Agent to the registered owners thereof at the addresses as shown
on the registration books maintained by the Registrar at the close of business on the fifteenth day of the calendar
month immediately preceding such interest payment date or, at the written request and expense of a registered owner
of $1,000,000 or more of Series 1998 Bonds, by wire transfer or other medium acceptable to the City and the Paying
Agent.
The Series 1998 Bonds are being issued pursuant to the Constitution and the laws of the State of Florida,
particularly Chapter 166, Part II, Florida Statutes and other applicable provisions of law, the Charter of the City
of Ocoee, Resolution No. 90-08, adopted by the City Commission of the City on August 21, 1990, as amended and
supplemented (collectivdy, the "Resolution"), in particular as amended and supplemented by Resolution No. 98-_,
adopted by the City Commission of the City on September 15, 1998 authorizing the Series 1998 Bonds.
Certain of the Series 1998 Bonds are subject to optional and mandatory redemption prior to maturity
as set forth in this Official Statement.
The Series 1998 Bonds are being issued, together with other legally available funds, to: (a) refund a portion
of the City's Transportation Refunding and Improvement Revenue Bonds, Series 1990, outstanding in the aggregate
principal amount of $6,215,000 (the "Series 1990 Bonds"), (b) finance the Project (as defined herein), consisting of
the acquisition of rights-of-way and the design, construction, paving and improvement of certain roads and related
drainage improvements within the City, (c) acquire a bond in an amount equal to the Reserve Requirement for the
.
Preliminary, subject to change
Q:\03198\pos.3.wpd
September 10. 1998
Series 1998 Bonds for deposit into a special subaccount in the Reserve Account established for the benefit of the
Series 1998 Bonds, and (d) pay the costs of issuance of the Series 1998 Bonds, including the municipal bond insurance
policy premium.
The Series 1998 Bonds and the interest thereon are payable solely from and secured by a prior lien on and
pledge of: (a) monies received by the City from (i) the Local Option Gas Tax and (u) the Public Service Taxes, until
released as more fully described herein and in the Resolution, and (b) until applied in accordance with the provisions
of the Resolution, certain moneys, including investments thereof, in certain of the funds and accounts established
by the Resolution (collectively, the "Pledged Revenues"). Such prior lien on and pledge of the Pledged Revenues is
on a parity with the lien and pledge granted to the holders of the Series 1990 Bonds that will remain outstanding and
any Additional Parity Obligations subsequently issued pursuant to the Resolution.
The Series 1998 Bonds and the interest thereon do not constitute a general indebtedness or general
obligation of the City within the meaning of any constitutional, statutory or charter provision or limitation,
and the City has not pledged its full faith and credit for the payment of the principal of, redemption premium,
if any, and interest on the Series 1998 Bonds or the making of any reserve or other payments provided for in
the Resolution. No Series 1998 Bondholder shall ever have the right to require or compel the exercise of the
ad valorem taxing power of the City or taxation in any form on any real or personal property of or in the
City, or to use any other funds of the City other than the Pledged Revenues, for the payment of the principal
of, redemption premium, if any, and interest on the Series 1998 Bonds or the making of any reserve or other
payments in connection therewith.
Payment of the principal of and interest, when due, on the Series 1998 Bonds will be insured by a municipal
bond insurance policy to be issued by MBIA Insurance Corporation simultaneously with the delivery of the Series
1998 Bonds. For a discussion of the terms and provisions of such policy, including the limitations thereof, see
"MUNICIPAL BOND INSURANCE" herein and APPENDIX F . "SPECIMEN COPY OF MUNICIPAL BOND
INSURANCE POLICY" attached hereto.
[MBIA's LOGO]
This cover page contains certain information for quick reference only. It is not a summary of the Series
1998 Bonds. Investors must read the entire Official Statement to obtain information essential to the making of an
informed investment decision regarding the Series 1998 Bonds.
The Series 1998 Bonds are offered when, as, and if issued and received by the Underwriter and subject to
the receipt of an opinion as to the validity of the Series 1998 Bonds and certain other matters by Bryant, Miller and
Olive, P.A., Tampa, Florida, Bond Counsel. Certain legal matters incident to the issuance and delivery of the Series
1998 Bonds will be passed upon for the City by its counsel, Foley & Lardner, Orlando, Florida, and for the
Underwriters by their counsel, Nabors, Giblin & Nickerson, P.A., Orlando, Florida. The City has retained First
Union Capital Markets, A division of Wheat First Securities, Inc., Orlando, Florida, as its financial advisor with
respect to the issuance of the Series 1998 Bonds. It is expected that the Series 1998 Bonds in definitive form will be
available for delivery in New York, New York on or about October ,1998.
WILLIAM R. HOUGH & CO.
SUNTRUST EQUITABLE SECURITIES
Dated: October _,1998
[Red Herring: This Preliminary Official Statement and any information contained herein are subject to completion
and amendment. The Series 1998 Bonds may not be sold and offers to buy may not be accepted prior to the time
the Official Statement is delivered in final form. Under no circumstances may this Preliminary Official Statement
Q:\03198\pos.3.wpd
September 10, 1998
constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 1998 Bonds
in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of such jurisdiction.]
Q:\03198\pos.3.wpd
September 10. 1998
MATURITIES, PRINCIPAL AMOUNTS, INTEREST RATES
AND PRICES OR YIEIDS
Principal
Maturity Amount
Interest
Rate
$
$
$
$
Serial Bonds
Xidd
Principal
Amount
Maturity
%
$
%
% Term Bonds Due
1,20_ - Price
% Term Bonds Due
1,20_ - Price
(Accrued interest to be added)
Interest
Rate
Xidd
%
%
%
%
Q:\03198\pos.3.wpd
September 10, 1998
CITY OF OCOEE, FLORIDA
150 North Lakeshore Drive
Ocoee, Florida 34761
(407) 656-2322
MAYOR
S. Scott Vandergrift
COMMISSIONERS
Scott A. Glass
Scott Anderson
Nancy J. Parker
Danny Howell
CITY MANAGER
Ellis Shapiro
CITY CLERK
Jean Grafton
FINANCE DIRECTOR
Wanda Horton
CITY ATTORNEYS
Foley & Lardner
Orlando, Florida
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
McDirmit, Davis, Lauteria, Puckett, Vogel & Company, P.A.
Orlando, Florida
CONSULTING ENGINEER
PEC/Professional Engineering Consultants, Inc.
Orlando, Florida
BOND COUNSEL
Bryant, Miller and Olive, P.A.
Tampa, Florida
FINANCIAL ADVISOR
First Union Capital Markets,
A division of Wheat First Securities~ Inc.
Orlando, Florida
Q:\03198\pos.3.wpd
September 10, 1998
No dealer, broker, salesman or other person has been authorized to give any information or to
make any representations, other than as contained in the Official Statement, in connection with
the offering of the Series 1998 Bonds described herein, and if given or made, such information or
representations must not be relied upon as having been authorized by the City or the
Underwriters. This Official Statement does not constitute an offer to sell nor the solicitation of
an offer to buy the Series 1998 Bonds, nor shall there be any sale of the Series 1998 Bonds by any
person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation
or sale.
The information set forth herein has been furnished by the City and by other sources
which are believed to be reliable, but such information is not guaranteed as to completeness and
accuracy and is not to be construed as a representation or contract, by the Underwriters. The
information and expressions of opinion stated herein are subject to change without notice, and
neither the delivery of this Official Statement nor any sale made hereunder shall, under any
circumstances create any implication that there has been no change in the information or opinions
set forth herein after the date of this Official Statement.
IN CONNECTION WITH THE OFFERING OF THE SERIES 1998 BONDS, THE
UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH
STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH SERIES 1998 BONDS
OFFERED HEREBY AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
THE SERIES 1998 BONDS HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF
1933, AS AMENDED, NOR HAS THE RESOLUTION BEEN QUALIFIED UNDER THE
TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON
EXEMPTIONS CONTAINED IN SUCH ACTS. THE REGISTRATION OR
QUALIFICATION OF THE SERIES 1998 BONDS IN ACCORDANCE WITH
APPLICABLE PROVISIONS OF THE SECURITIES LAWS OF THE STATES, IF ANY, IN
WHICH THE SERIES 1998 BONDS HAVE BEEN REGISTERED OR QUALIFIED AND
THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN CERTAIN
OTHER STATES CANNOT BE REGARDED AS A RECOMMENDATION THEREOF.
NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HA VE PASSED UPON
THE MERITS OF THE SERIES 1998 BONDS OR THE ACCURACY OR COMPLETENESS
OF THIS OFFICIAL STATEMENT. ANY REPRESENTATIONS TO THE CONTRARY
MAY BE A CRIMINAL OFFENSE.
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September to, 1998
TABLE OF CONTENTS
~
SUMMARY STATEMENT .................................................. I
The City ............................................................... I
The Series 1998 Bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I
Purpose of the Series 1998 Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I
Security and Sources of Payment for the Bonds ................................ II
Reserve Account ........................................................ II
Parity Obligations ....................................................... ill
Municipal Bond Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ill
Historical and Projected Coverage of the Maximum Bond Service Requirement . . . . . . . ill
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS ....... 2
General ................................................................ 2
Local Option Gas Tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Public Service Taxes ...................................................... 5
Release of Lien on Public Service Tax .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Additional Covenants of the City . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Historical and Projected Coverage of the Maximum Bond Service Requirement . . . . . . . . 7
Municipal Bond Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Reserve Account ......................................................... 8
Additional Parity Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Issuance of Public Service Tax Obligations .................................... 10
Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
MUNICIPAL BOND INSURANCE . . . . .. . . .. . . . .. .. .. .. . . . . .. . . . . . .. . . . . . . .. 11
Bond Insurance Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Debt Service Reserve Surety Bond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
THE REFUNDING PROGRAM ............................................ 15
THE SERIES 1998 BONDS.................................................. 15
General ............................................................... 15
Optional Redemption ............................ ~ . . . . . . . . . . . . . . . . . . . . . . . 16
Mandatory Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . '-'. . . . . . . . . . . . . . . . . . 18
Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Transfer and Exchange ................................................... 19
ESTIMATED SOURCES AND USES OF FUNDS .............................. 21
SCHEDULED DEBT SERVICE FOR THE SERIES 1998 BONDS . . . . . . . . . . . . . . . . . . 22
THE CITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
History and Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
THE PROJECT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Maguire Road Project .................................................... 23
(i)
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September 10, 1998
Professional Parkway Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Main Street Project ...................................................... 24
Additional Projects ...................................................... 24
LITIGATION ............................................................ 24
LEGAL MA TIERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
TAX EXEMPTION ....................................................... 25
General ............................................................... 25
Tax Treatment of Original Issue Discount .................................... 26
VERIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
UNDERWRITING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
CONTINUING DISCLOSURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
YEAR 2000 COMPUTER REMEDIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
RATINGS ............................................................... 28
FINANCIAL STATEMENTS ............................................... 28
FINANCIAL ADVISOR ................................................... 29
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS. . . . . . . . . . . . 29
ENFORCEABILITY OF REMEDIES ......................................... 29
MISCELLANEOUS ....................................................... 29
CERTIFICATE AS TO OFFICIAL STATEMENT. . . . . ... . . . . . . ..... ... . . . .. .. .30
APPENDIX A GENERAL INFORMATION CONCERNING THE CITY OF OCOEE
AND ORANGE COUNTY
APPENDIX B AUDITED FINANCIAL STATEMENTS OF THE CITY
APPENDIX C SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION
APPENDIX D FORM OF BOND COUNSEL'S LEGAL OPThHON
APPENDIX E FORM OF CONTINUING DISCLOSURE CER TIFICA TE
APPENDIX F SPECIMEN COPY OF MUNICIPAL BOND INSURANCE POLICY
(ii)
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September 10. 1998
SUMMARY STATEMENT
This Summary Statement, being part of the Official Statement, is subject to the more
complete information contained herein and should not be considered to be a complete statement
of the facts material to making an investment decision. The offering of the City of Ocoee, Florida
Transportation Refunding and Improvement Revenue Bonds, Series 1998 (the "Series 1998
Bonds"), to potential investors is made only by means of the entire Official Statement. No person
is authorized to detach this Summary Statement from the Official Statement or otherwise use it
without the entire Official Statement. Capitalized terms used but not defined in this Summary
Statement shall have the same meanings as in the Resolution, unless the context would clearly
indicate otherwise. See "APPENDIX C - SUMMARY OF CERTAIN PROVISIONS OF THE
RESOLUTION" attached hereto.
The City
The City of Ocoee, Florida (the "City") was incorporated in 1925. It is bounded on the
west by Winter Garden, Florida, and on the south by Windermere, Florida, and has a land area
of approximately 20.5 square miles, making it the second largest city in land area of the thirteen
cities located in Orange County (the "County"). As of April, 1998, the population of the City
was estimated at 21,007, which ranks the City third in population of the cities located in Orange
County. See "APPENDIX A - GENERAL INFORMA nON CONCERNING THE CITY
OF OCOEE AND ORANGE COUNTY" attached hereto.
The Series 1998 Bonds
The Series 1998 Bonds are issuable only in fully registered form, without coupons, in
denominations of $5,000 or any integral multiples thereof. Interest on the Series 1998 Bonds is
payable semi-annually, beginning on April 1, 1998 and on each October 1 and April 1 thereafter
until maturity or earlier redemption as more fully described herein.
, Florida is serving as Registrar and Paying Agent for the Series 1998 Bonds.
Purpose of the Series 1998 Bonds
The Series 1998 Bonds are being issued pursuant to the Constitution and laws of the State
of Florida, particularly Chapter 166, Part n, Florida Statutes and other applicable provisions of
law, the Charter of the City of Ocoee (the "Act"), Resolution No. 90-08, adopted by the City
Commission of the City on September 15, 1990, as amended and supplemented (collectively, the
"Resolution"), in particular as amended and supplemented by Resolution No. 98-_, adopted by
the City Commission of the City on , 1998, to provide funds to: (a) refund a portion
ofthe City's Transportation Refunding and Improvement Revenue Bonds, Series 1990 (the "Series
1990 Bonds"), which will be outstanding in the aggregate principal amount of $1,540,000
following the issuance of the Series 1998 Bonds, (b) finance the Project (as defined herein),
I
Q:\03198\pos.3.wpd
September 10. 1998
cons1stmg of the acqu1S1t10n of rights-of-way and the design, construction, paving and
improvement of certain roads and related drainage improvements within the City, (c) acquire a
surety bond in an amount equal to the Reserve Requirement for the Series 1998 Bonds for deposit
into a special subaccount in the Reserve Account established for the benefit of the Series 1998
Bonds, and (d) pay the costs of issuance of the Series 1998 Bonds, including the municipal bond
insurance policy premium.
Security and Sources of Payment for the Bonds
The Series 1998 Bonds and the interest thereon are payable solely from and secured by a
prior lien on and pledge of: (a) monies received by the City from (i) the Local Option Gas Tax
and (ii) the Public Service Taxes, until released as more fully described herein and in the
Resolution, and (b) until applied in accordance with the provisions of the Resolution, certain
moneys, including investments thereof, in the Debt Service Fund and the Construction Fund
established by the Resolution (collectively, the "Pledged Revenues"). Such prior lien on and
pledge of the Pledged Revenues is on a parity with the lien and pledge granted to the holders of
the Series 1990 Bonds and any Additional Parity Obligations subsequently issued pursuant to the
Resolution.
The Series 1998 Bonds and the interest thereon shall not be or constitute a general
indebtedness or general obligation of the City within the meaning of any constitutional, statutory
or charter provision or limitation, and the City has not pledged its full faith and credit for the
payment of the principal of, redemption premium, if any, and interest on the Series 1998 Bonds
or the making of any reserve or other payments provided for in the Resolution. No Series 1998
Bondholder shall ever have the right to require or compel the exercise of the ad valorem taxing
power of the City or taxation in any form on any real or personal property of or in the City for
the payment of the principal of, redemption premium, if any, and interest on the Series 1998
Bonds or the making of any reserve or other payments in connection therewith. See
"SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS" herein.
Reserve Account
The Resolution provides for the establishment and maintenance of a special subaccount
in the Reserve Account for each Series of Bonds issued pursuant to the Resolution. Upon
delivery of the Series 1998 Bonds, the City shall deposit a surety bond in an amount equal to the
Reserve Requirement into such subaccount established for the benefit of the Series 1998 Bonds.
See "MUNICIPAL BOND INSURANCE - Debt Service Reserve Surety Bond" herein for a
description of such surety bond. .
II
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September 10, 1998
Parity Obligations
Pursuant to certain requirements set forth in the Resolution, the City may issue
Additional Parity Obligations payable from and secured by the Pledged Revenues (other than
amounts on deposit in each subaccount in the Reserve Account which amounts are pledged only
for the payment of the principal of, interest on and redemption premium, if any, on the series of
Bonds for which such subaccount was established) on a parity with the Series 1998 Bonds.
Pursuant to the Resolution, the City may also issue Public Service Tax Obligations payable from
and secured by Public Service Taxes on a parity with the Series 1998 Bonds. See "SECURITY
AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS - Additional Parity
Obligations" and "-Issuance of P~blic Service Tax Obligations" herein.
Municipal Bond Insurance
MBIA Insurance Corporation ("MBIA ") has committed to issue a policy of municipal
bond insurance (the "Policy") which will insure the timely payment of the principal of and
interest on the Series 1998 Bonds at the stated maturity, mandatory sinking fund redemption and
payment dates thereof. The insurance extends for the term of the Series 1998 Bonds and cannot
be canceled by the Insurer. Payment under the Policy is subject to the conditions described under
the caption "MUNICIPAL BOND INSURANCE - Bond Insurance Policy" herein.
Historical and Projected Coverage of the Maximum Bond Service Requirement
The historical Local Option Gas Tax and Public Service Tax Revenues for the Fiscal Years
ending September 30, 1993 through 1997, the estimated Local Option Gas Tax and Public Service
Tax Revenues for the Fiscal Year ended September 30, 1998 and the historical and projected
coverage afforded thereby based on the Maximum Bond Service Requirement for the Bonds are
set forth in "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS -
Historical and Projected Coverage of the Maximum Bond Service Requirement."
The amounts and the availability of any of the sources of Pledged Revenues are subject to
change (including reduction or elimination) as a result of changes in State or federal law or such
factors as changing economic conditions, reduction in gas consumption resulting from a shortage
in supply or an increase in the price of oil, changing physical or social characteristics of the City,
and other future conditions or events not presently ascertainable.
[REMAINDER OF THIS P AGE INTENTIONALLY LEFT BLANK]
III
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September 10, 1998
OFFICIAL STATEMENT
$
CITY OF OCOEE, FLORIDA
Transportation Refunding and Improvement Revenue Bonds,
Series 1998
.
INTRODUCTION
The purpose of this Official Statement, including the cover page, the Summary Statement
and all appendices, is to set forth certain information in connection with the sale by the City of
Ocoee, Florida (the "City") of its $ * aggregate principal amount of Transportation
Refunding and Improvement Revenue Bonds, Series 1998 (the "Series 1998 Bonds").
The Series 1998 Bonds are being issued pursuant to the Constitution and Laws of the State
of Florida, including Chapter 166, Part II, Florida Statutes and other applicable provisions of law
(the "Act"), the Charter of the City of Ocoee, Resolution No. 90-08, adopted by the City
Commission of the City on August 21, 1990, as amended and supplemented (collectively, the
"Resolution"), in particular as amended and supplemented by Resolution No. 98- _, adopted by
the City Commission of the City on September 15, 1998.
The Series 1998 Bonds are being issued, together with other legally available funds to:
(a) refund a portion of the City's Transportation Refunding and Improvement Revenue Bonds,
Series 1990 (the "Series 1990 Bonds"), which will be outstanding in the aggregate principal amount
of $1,540,000 following the issuance of the Series 1998 Bonds, (b) finance the Project (as defined
herein), consisting of the acquisition of rights-of-way and the design, construction, paving and
improvement of certain roads and related drainage improvements within the City, (c) acquire a
surety bond in an amount equal to the Reserve Requirement for the Series 1998 Bonds for deposit
into the Reserve Account established for the benefit of the Series 1998 Bonds, and (d) pay the
costs of issuance of the Series 1,998 Bonds, including the municipal bond insurance policy
premium. For additional information concerning the use of the proceeds of the Series 1998
Bonds, see "ESTIMATED SOURCES AND USES OF FUNDS" herein.
The Series 1998 Bonds and the interest thereon are payable solely from and secured by a
prior lien upon and a pledge of: (a) monies received by the City from (i) the Local Option Gas
Tax, and (ii) the Public Service Taxes, until released as more fully set forth herein and in the
Resolution, and (b) until applied in accordance with the provisions of the Resolution, certain
moneys, including investments thereof, in the Debt Service Fund and the Construction Fund
established by the Resolution, collectively the "Pledged Revenues"). Such prior lien on and pledge
.Preliminary, subject to change.
Q:\03198\pos.3.wpd
September 10, 1998
of the Pledged Revenues is on a parity with the lien and pledge granted to the holders of the Series
1990 Bonds and any Additional Parity Obligations subsequently issued pursuant to the
Resolution (together with the Se.ries 1998 Bonds, collectively, the "Bonds"). The lien of and
pledge of Public Service Taxes is also on a parity with the lien and pledge granted to the holders
of any Public Service Tax Obligations subsequently issued pursuant to the Resolution. For
additional information concerning the security for and source of payment of the Series 1998
Bonds, see "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS"
herein.
This Official Statement speaks only as of its date and the information contained herein is
subject to change.
Capitalized terms used but not defined in this Official Statement have the same meanings
as used in the Resolution, unless the context clearly indicates otherwise. Complete descriptions
of the terms and conditions of the Series 1998 Bonds are set forth in the Resolution, a summary
of certain provisions of which is attached to this Official Statement as APPENDIX C. The
description of the Series 1998 Bonds, the documents authorizing and securing the same, and the
information from various reports and statements contained herein are not comprehensive or
definitive. All references herein to such documents, reports and statements are qualified by the
entire, actual content of such documents, reports and statements. Copies of such documents,
reports and statements referred to herein that are not included in their entirety in this Official
Statement may be obtained, after payment of applicable copying and mailing costs, from the City
of Ocoee, at 150 North Lakeshore Drive, Ocoee, Florida 34761, Attention: City Manager.
SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1998 BONDS
General
The Series 1998 Bonds are payable solely from and secured by a prior lien upon and pledge
of: (a) monies received by the City from (i) the Local Option Gas Tax and (ii) the Public Service
Taxes, until released as more fully described herein and in the Resolution, and (b) until applied
in accordance with the provisions of the Resolution, certain moneys, including investments
thereof, in the Debt Service Fund and the Construction Fund established by the Resolution
(collectively, the "Pledged Revenues"). In the Resolution, the City irrevocably pledges the
Pledged Revenues to the payment of the principal of, redemption premium, if any, and interest
on the Bonds and all other payments required under the Resolution.
The Series 1998 Bonds and the interest thereon do not constitute a general
indebtedness or general obliga~ion of the City within the meaning of any constitutional,
statutory or charter provision or limitation, and the City has not pledged its full faith and
credit for the payment of the principal of, redemption premium, if any, and interest on the
2
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September 10. 1998
Series 1998 Bonds or the making of any reserve or other payments provided for in the
Resolution. No Series 1998 Bondholder shall ever have the right to require or compel the
exercise of the ad valorem taxing power of the City or taxation in any form on any real or
personal property of or in the City, or to use any other funds of the City other than the
Pledged Revenues, for the payment of the principal of, redemption premium, if any, and
interest on the Series 1998 Bonds or the making of any reserve or other payments in
connection therewith.
The Resolution establishes the Revenue Fund, the Debt Service Fund (which includes the
Principal Account, the Interest Account, the Redemption Account and the Reserve Account), the
Construction Fund and the Public Service Taxes Fund. All such funds and accounts will be held
by the City as trust funds, but no independent trustee has been appointed to hold the moneys in
such funds for the benefit of the Holders of the Series 1998 Bonds. For information on all funds
and accounts and the disposition and flow of revenues, see APPENDIX C - "SUMMARY OF
CERTAIN PROVISIONS OF THE RESOLUTION - Funds and Accounts; Flow of Funds"
attached hereto.
The designation and establishment of the various funds and accounts by the Resolution
does not require the establishment of any completely independent, self-balancing funds as such
term is commonly defined and used in government accounting, but rather is intended solely to
constitute an earmarking of certain Pledged Revenues for certain purposes and to establish certain
priorities for application of such revenues, as provided in the Resolution.
Local Option Gas Tax
Pursuant to the Resolution, Local Option Gas Tax revenues distributed to the City,
including any local option gas taxes that are levied in excess of such taxes currently authorized,
are pledged on a parity basis to the repayment of any Bonds issued pursuant to the Resolution,
including the Series 1998 Bonds.
The Local Option Gas Taxis received by the City under the authority of Florida Statutes,
Chapter 336. Pursuant to Section 336.025 (l)(a), Florida Statutes, each county in the State is
authorized to levy a local option fuel tax of up to six cents (in whole penny increments) per gallon
on every gallon of motor fuel and diesel fuel sold in the county (the "Local Option Gas Tax"), and
distribute such tax among itself and the municipalities in the county. The Local Option Gas Tax
may be levied by an ordinance adopted by a majority vote of the governing body of the county
or by referendum. The Local Option Gas Tax may be levied by a county for a period not to
exceed 30 years and must be levied before July 1 of each year to be effective on January 1 of the
following year.
The State Department of Revenue collects and deposits the tax into the Local Option Gas
Tax Trust Fund (the "Gas Tax Fund"). Monies in the Gas Tax Fund, net of service charges and
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September 10, 1998
fees collected by State agencies pursuant to law, are distributed monthly by the State to each
county. Local Option Gas Tax revenues are distributed by the county amongst itself and the
municipalities in the county based on either an interlocal agreement between the county and one
or more municipalities representing a majority of the population of the incorporated area within
the county, or historical transportation expenditures.
Disbursements from the Gas Tax Fund may be used only for the following programs:
(a) public transportation operations and maintenance; (b) roadway and rights-of-way maintenance
and equipment and structures used primarily for the storage and maintenance of such equipment;
(c) roadway and rights-of-way drainage; (d) street lighting; (e) traffic signs, traffic engineering,
signalization and pavement markings; (~ bridge maintenance and operation; and (g) debt service
and current expenditures for transportation capital projects including road construction and
reconstruction.
The County, pursuant to Ordinance No. 83-26, adopted by the board of county
commissioners (the "Board") of the County on June 20, 1983 and Ordinance No. 85-22, adopted
by the Board on July 24, 1985, currently imposes a Local Option Gas Tax of six cents per gallon
for a 30 year period ending in 2015. Local Option Gas Tax revenues are currently distributed by
the County amongst itself and the municipalities within the County pursuant to that certain
Orlando-Orange County 1997lnterlocal Agreement on Local Fuel (Gas) Tax Distribution, dated
April _' 1997 (the "Interlocal Agreement"), between the County and the City of Orlando
("Orlando"). Pursuant to the Interlocal Agreement, Local Option Gas Tax revenues are
distributed during an initial four year transition period (fiscal years 1998 through 2001) based on
percentages set forth in an exhibit to the Interlocal Agreement described in the next paragraph.
After such four year transition period, Local Option Gas Tax revenues will be distributed based
on the percentage of the County's and each municipality's respective estimated population in
comparison to the total estimated population of the County. The Interlocal Agreement contains
a covenant between Orlando, the County and to the other municipalities described in the
Interlocal Agreement (including the City), to take no action which would impair the rights of any
party under contracts entered into by such entities which anticipate the distribution and receipt
of the Local Option Gas Tax proceeds.
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September 10. 1998
Pursuant to the Interlocal Agreement, the following percentages of Local Option Gas Tax
revenues will be disbursed to the City for the initial four year period covered by the lnterlocal
Agreement:
Fiscal Year Percentage
1998 2.57%
1999 2.63
2000 2.68
2001 2.81
Following the initial four year period, Local Option Gas Tax revenues will be distributed to the
City based on the percentage of total estimated County population represented by the total
estimated population of the City as of April 1 of the preceding fiscal year. The City's April, 1998
estimated population constituted _ % of the estimated total population of the County.
Public Service Taxes
Pursuant to the Resolution, Public Service Taxes levied by the City are pledged on a parity
basis to the repayment of: (a) any Bonds issued pursuant to the Resolution, including the Series
1998 Bonds, and (b) Public Service Tax Obligations issued pursuant to the Resolution. Public
Service Taxes are levied and collected by the City pursuant to Section 166.231, Florida Statutes,
and Ordinance No. 330 duly enacted by the City on December 20,1955 and Ordinance No. 542
duly enacted by the City on October 19, 1971 (collectively the "Public Service Tax Ordinance").
The lien on Public Service Taxes shall be released and extinguished under the circumstances
described herein under "SECURITY AND SOURCES OFPA YMENTFOR THE SERIES 1998
BONDS - Release of Lien on Public Service Tax."
Florida Statutes, Section 166.231 authorizes municipalities to impose a tax on purchases
of electricity, metered natural gas, metered or bottled liquified petroleum natural gas, metered or
bottled manufactured gas, water service and telecommunications service delivered in the corporate
limits of the City. The tax is in an amount equal to ten percent (10%) of all payments received
by the seller of any such service, except for telecommunications services which originate and
terminate within the State, in which case the tax is limited to seven percent. A municipality may
levy a public service tax on other competitive services as defined in the ordinance imposing the
tax on a comparable based and at the same rates, provided however, that fuel oil shall be taxed at
a rate not to exceed four cents per gallon. The tax is collected by the provider of the service and
remitted to the municipality in the manner prescribed by ordinance, less one percent of the
amount of tax collected, which the service provider is allowed to retain.
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September 10, 1998
Pursuant to the Public Service Tax Ordinance it is the duty of every seller of [electricity,
water service, metered or bottled gas, whether naturalliquified petroleum gas or manufactured,
fuel oil, telephone service and telegraph service] within the geographic boundaries of the City,
to collect from the purchaser, for the use of said City, the tax levied pursuant to the Public Service
Tax Ordinance, at the time of collecting the selling price thereof, and to report and pay over, on
or before the 10th day of each calendar month, unto the City all such taxes levied and collected
during the preceding month.
The Public Service Tax Ordinance provides that the sale of natural gas to a public or
private utility, including a utility operated by the City or other municipal corporation, and rural
electric cooperative associations, either for resale or for use as a fuel in the generation of electricity
is not deemed to be a utility service and purchasers thereof under such circumstances shall be
exempt from the payment of the Public Service Taxes.
All federal, State of Florida, county and municipal governments and their commissions
and agencies and all public schools are exempt from the payment of the Public Service Taxes.
Release of Lien on Public Service Tax
The lien of the holders of outstanding Bonds on the Public Service Taxes shall be released
and extinguished upon receipt by the City of a certificate or an opinion of an independent
certified public accountant which ~ertifies or opines, as applicable, that the Local Option Gas Tax
received by the City during each of the two preceding complete fiscal years shall have been equal
to not less than 135% of the Maximum Bond Service Requirement on the Outstanding Bonds as
of the date of such certificate or opinion, provided however, that such lien shall not be released
unless the applicable laws with respect to the Local Option Gas Taxes are amended to extend the
period that such taxes may be imposed to a date which equals or exceeds the final maturity date
of the Series 1998 Bonds. See "SECURITY AND SOURCE OF PAYMENT FOR THE 1998
BONDS - Release of Lien on Public Service Tax" herein.
Additional Covenants of the City
Pursuant to the Resolution, the City has covenanted that it will diligently enforce and
collect the Pledged Revenues and will take steps, actions and proceedings for the enforcement and
collection of such Pledged Revenues as shall become delinquent to the full extent permitted or
authorized by law; and will maintain accurate records with respect thereof; and will not repeal
or adversely amend its Charter, ordinances, resolutions or interlocal agreements relating to the
Pledged Revenues so as to impair the power and obligations of the City to collect such Pledged
Revenues. The City further covenants that it shall not repeal or adversely amend its Charter,
ordinances, resolutions or interlocal agreements relating to the Pledged Revenues so as to impair
the power and obligations of the City to collect such Pledged Revenues.
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September 10, 1998
Historical and Projected Coverage of the Maximum Bond Service Requirement
Historical Local Option Gas Taxes and Public Service Taxes collected for the Fiscal Years
ending September 30, 1993 through 1997, projected Local Option Gas Taxes and Public Service
Taxes collected for the Fiscal Year ended September 30, 1998 and the historical and projected
coverage afforded thereby based on the Maximum Bond Service Requirement for the Bonds are
set forth below:
Coverage Based
on Maximum
Local Option T otaI Local Option Debt Service
Fiscal Years Ending Gas Tax Public Service Gas Tax and Public Requirements
September 30 collected Taxes collected Service Taxes For the Bonds(l)
1993 $329,621 $1,003,064 $1,332,685 2.14%
1994 329,968 1,158,359 1,488,327 2.39
1995 339,910 1,285,064 1,624,974 2.61
1996 361,581 1,487,498 1,849,079 2.97
1997 386,850 1,729,244 2,116,094 3.39
1998 718,000 1,798,200 2,516,200 1.71
The amounts and the availability of the Local Option Gas Taxes and the Public Service
Taxes are subject to change (including reduction or elimination) as a result of changes in State or
Federal law or such factors as changing economic conditions, reduction in gas consumption
resulting from a shortage in supply or an increase in the price of oil, changing physical or social
characteristics of the City, and other future conditions or events not presently ascertainable.
Subject to certain conditions set forth in the Resolution, the lien of the Bonds on Public Service
Taxes may be released and discharged as described in "SECURITY AND SOURCE OF
PAYMENT FOR THE 1998 BONDS - Release of Lien on Public Service Tax" herein and the
Local Option Gas Tax currently expires in 2015. The City is unaware of any State or federal laws
that are currently pending which would reduce or eliminate the amounts and availability of any
of the sources of Pledged Revenues.
Coverage for Fiscal Years ending September 30, 1993 through 1997 was calculated based
on the maximum debt service requirements for the Series 1990 Bonds ($623,302). For
Fiscal Year 1998, coverage was calculated based on the sum of the approximate maximum
debt service requirements on the Series 1998 Bonds ($1,303,508) and the unrefunded
ponion of the Series 1990 Bonds ($165,505) or $1,469,013.
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September 10, 1998
Municipal Bond Insurance
MBIA has committed to issue the Policy which will insure the timely payment of the
principal of and interest on the Series 1998 Bonds at the stated maturity, mandatory sinking fund
redemption and payment dates thereof. The insurance extends for the term of the Series 1998
Bonds and cannot be canceled by MBIA. Payment under the Policy is subject to the conditions
described under the caption "MUNICIPAL BOND INSURANCE."
Reserve Account
The Resolution provides for the establishment and maintenance of a separate subaccount
in the Reserve Account for each Series of Bonds issued pursuant to the Resolution. Upon
delivery of the Series 1998 Bonds, the City shall deposit a surety bond issued by MBIA in an
amount equal to the Reserve Requirement to the Reserve Account established for the benefit of
the Series 1998 Bonds. Pursuant to the Resolution, the "Reserve Requirement" is defined as the
lesser of: (i) the Maximum Debt Service Requirement, (ii) one and one-quarter times the Average
Annual Debt Service Requirement, or (iii) such amount as will not adversely affect the exclusion
of interest on the Series 1998 Bonds from the gross income of the holders of the Series 1998 Bonds
for purposes of Federal income taxation.
Proceeds of the surety bonds on deposit in the subaccount of the Reserve Account
established for the Series 1998 Bonds shall be applied in accordance with the provisions of the
Resolution solely for the purpose of the payment of principal of, or interest on the Series 1998
Bonds for which such account was established and for no other Series of Bonds.
Any withdrawals from the Reserve Account shall be subsequently restored from the first
moneys available in the Revenue Fund, on a pro rata basis as to all reserve accounts, after all
required current applications and allocations to the Debt Service Fund, including all deficiencies
for prior payments, have been made in full. Notwithstanding the foregoing, in no event shall the
City be required to deposit into any reserve account established under the Resolution (including
the Reserve Account) an amount greater than that amount necessary to ensure that the difference
between the Reserve Requirement for the Series of Bonds for which such account was established
and the amounts on deposit in such account on the date of calculation shall be restored not later
than 60 months after the date of such deficiency (assuming equal monthly payments into such
account for such 60 month period).
Upon the issuance of any Additional Parity Obligations under the terms, limitations and
conditions as provided in the Resolution, any additional deposit to the Reserve Account shall be
in such amount as shall be determined by a resolution of the City adopted prior to the issuance
of such Additional Parity Obligations.
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September 10. 1998
Additional Parity Obligations
Additional Parity Obligations, payable from Pledged Revenues on a parity with the Series
1998 Bonds, may be issued under the Resolution upon satisfaction of the following conditions:
(1) An independent certified public accountant shall certify or opine at the time
of the issuance of the Additional Parity Obligations that no Event of Default exists under
the Resolution.
(2) Such independent certified public accountant shall certify or opine at the
time of the issuance of the Additional Parity Obligations that the Local Option Gas Tax,
together with the Public Service Taxes (unless the lien on the Public Service Taxes is
previously released pursuant to the provisions of the Resolution), adjusted as provided
below, received by the City during (i) the Fiscal Year immediately preceding the Fiscal
Year in which the Additional Parity Obligations are to be issued or (ii) during two of the
last three full Fiscal Years immediately preceding the Fiscal Year in which the Additional
Parity Obligations are proposed to be issued shall have been equal to not less than 135%
of the Maximum Bond Service Requirement on the Outstanding Bonds and the proposed
Additional Parity Obligations during any Fiscal Year in which the Additional Parity
Obligations to be issued will be outstanding.
The Local Option Gas Taxes and, if not previously released from the lien of the
Resolution, the Public Service Taxes for such period may be adjusted to include the estimated
Local Option Gas Taxes or Public Service Taxes, as certified or opined to by an independent
certified public accountant, that the City would have received from areas that the City has
annexed prior to the issuance of the Additional Parity Obligations and which are not fully
reflected in such period.
The Local Option Gas Taxes and, if not previously released from the lien of the
Resolution, the Public Service Taxes for such period may also be adjusted to include the estimated
Local Option Gas Taxes or Public Service Taxes, as certified or opined to by an independent
certified public accountant, that the City would have received during such period due to increase
in the rate or rates or a modification in the method of distribution of such taxes effected during
such period and not fully reflected in such period.
The resolution authorizing the issuance of the Additional Parity Obligations shall recite
that all of the covenants contained in the Resolution will be applicable to such Additional Parity
Obligations, except as otherwise provided in the Resolution.
No Additional Parity Obligations with interest payable at a variable rate may be issued
without the consent of MBIA so long as the Policy with respect to the Series 1998 Bonds shall be
in effect and MBlA shall not be in default thereunder.
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September 10, 1998
Issuance of Public Service Tax Obligations
The City may issue Public Service Tax Obligations under the Resolution, which shall be
payable on a parity with Public Service Taxes required to be deposited to the Debt Service Fund
under the Resolution, upon the conditions and in the manner provided herein:
(1) There shall be obtained and filed with the City an opinion or a certificate
of an independent certified public accountant to the effect that the historical Local Option
Gas Taxes and Public Service Taxes (adjusted as provided below) received by the City
during (i) the Fiscal Year immediately preceding the Fiscal Year in which the Public
Service Tax Obligations are proposed to be issued or (ii) two of the last three full Fiscal
Years immediately preceding the Fiscal Year in which the Public Service Tax Obligations
are proposed to be issued shall have been equal to not less than 135% of the Maximum
Bond Service Requirement on all Outstanding Bonds.
(2) There shall be obtained and filed with the City an opinion or a certificate
of an independent certified public accountant to the effect that the portion of the historical
Public Service Taxes adjusted as provided below received by the City during (i) the Fiscal
Year immediately preceding the Fiscal Year in which the Public Service Tax Obligations
are proposed to be issued or (ii) two of the last three Fiscal Years immediately preceding
the Fiscal Year in which the Public Service Tax Obligations are proposed to be issued and
not required to be used to provide the coverage requirements set forth in (1) above shall
have been equal to not less than 120% of the maximum annual debt service requirement
on any outstanding Public Service Tax Obligations and the Public Service Tax Obligations
with respect to which such certificate is made.
The Local Option Gas Tax and the Public Service Taxes for such period may be adjusted
to include the estimated Local Option Gas Tax or Public Service Taxes, as applicable, as certified
or opined to by an independent certified public accountant, that the City would have received
from areas that the City has annexed prior to the issuance of the Public Service Tax Obligations
and not fully reflected in such period.
The Local Option Gas Tax and the Public Service Taxes for such period may also be
adjusted to include the estimated Local Option Gas Tax or Public Service Taxes, as applicable,
as certified or opined to by an independent certified public accountant, that the City would have
received during such period due to an increase in the rate or rates or a modification in the method
of distribution of such taxes effected during such period and not fully reflected in such period.
An independent certified public accountant shall certify or opine at the time of issuance
of the Public Service Tax Obligations that no Event of Default exists under the Resolution.
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September 10, 1998
No Public Service Tax Obligations with interest payable at a variable rate may be issued
without the consent of MBIA so long as the Policy with respect to the Series 1998 Bonds shall be
in effect and MBIA shall not be in default thereunder. Additionally, no Public Service Tax
Obligations may be issued which include the power to accelerate the principal of and the
redemption premiums, if any, on such Public Service Tax Obligations for so long as Bonds shall
be Outstanding under the Resolution.
Upon the release and extinguishment of the lien on the Public Service Taxes, as set forth
in the Resolution, the above restrictions on the City. s ability to issue Public Service Tax
Obligations shall be of no further force and effect.
Investment
Money on deposit in the Construction Fund, the Revenue Fund, the Public Service Taxes
fund and the Debt Service Fund, excluding the Reserve Account, may be invested and reinvested
in Investment Securities which mature not later than the dates on which the moneys on deposit
therein will be needed for the purpose of such fund. Moneys in each subaccount in the Reserve
Account, if any, may be invested and reinvested in Investment Securities maturing not later than
the latest maturity date of any Bond for which such subaccount was established. All income on
such investments, except for income on investments in the Reserve Account and the Construction
Fund, shall be deposited in the respective funds and accounts from which such investments were
made and be used for the purposes thereof unless and until the amount required to be on deposit
is on deposit therein, and thereafter shall be deposited in the Revenue Fund. Investment income
on each subaccount in the Reserve Account shall be deposited and credited as determined by
subsequent resolution of the Issuer adopted prior to the series of Bonds for which such
subaccount is established. Investment income earned on the Construction fund shall remain on
deposit in the construction Fund and shall be used solely for the purposes set forth in the
Resolution.
MUNICIPAL BOND INSURANCE
Bond Insurance Policy
The following information has been furnished by MBIA for use in this Official
Statement. Reference is made to Appendix F herein for a specimen of MBIA's policy.
MBIA's policy unconditionally and irrevocably guarantees the full and complete payment
required to be made by or on behalf of the County to the Paying Agent or its successor of an
amount equal to (i) the principal of (either at the stated maturity or by an advancement of
maturity pursuant to a mandatory sinking fund payment) and interest on, the Series 1998 Bonds
as such payments shall become due but shall not be so paid (except that in the event of any
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September 10, 1998
acceleration of the due date of such principal by reason of mandatory or optional redemption or
acceleration resulting from default or otherwise, other than any advancement of maturity
pursuant to a mandatory sinking fund payment, the payments guaranteed by MBIA's Policy shall
be made in such amounts and at such times as such payments of principal would have been due
had there not been any such acceleration); and (ii) the reimbursement of any such payment which
is subsequently recovered from any owner of the Series 1998 Bonds pursuant to a final judgment
by a court of competent jurisdiction that such payment constitutes an avoidable preference to
such owner within the meaning of any applicable bankruptcy law (a "Preference").
MBIA's policy does not insure against loss of any prepayment premium which may at any
time be payable with respect to any Series 1996 Bond. MBIA's Policy does not, under any
circumstance, insure against loss relating to: (i) optional or mandatory redemptions (other than
mandatory sinking fund redemptions); (ii) any payments to be made on an accelerated basis;
(iii) payments of the purchase price of Series 1998 Bonds upon tender by an owner thereof; or
(iv) any Preference relating to (i) through (iii) above. MBIA' s policy also does not insure against
nonpayment of principal of or interest on the Series 1998 Bonds resulting from the insolvency,
negligence or any other act or omission of the Paying Agent or any other paying agent for the
Series 1998 Bonds.
Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in
writing by registered or certified mail, or upon receipt of written notice by registered or certified
mail, by MBIA from the Paying Agent or any owner of a Series 1998 Bond the payment of an
insured amount for which is then due, that such required payment has not been made, MBIA on
the due date of such payment or within one business day after receipt of notice of such
nonpayment, whichever is later, will make a deposit of funds, in an account with State Street
Bank and Trust Company, N.A., in New York, New York, or its successor, sufficient for the
payment of any such insured amounts which are then due. Upon presentment and surrender of
such Series 1998 Bonds or presentment of such other proof of ownership of the Series 1998 Bonds,
together with any appropriate instruments of assignment to evidence the assignment of the
insured amounts due on the Series 1998 Bonds as are paid by MBIA, and appropriate instruments
to effect the appointment of MBIA as agent for such owners of the Series 1998 Bonds in any legal
proceeding related to payment of insured amounts on the Series 1998 Bonds, such instruments
being in a form satisfactory to State Street Bank and Trust Company, N.A., State Street Bank and
Trust Company, N.A. shall disburse to such owners or the Paying Agent payment of the insured
amounts due on such Series 1998 Bonds, less any amount held by the Paying Agent for the
payment of such insured amounts and legally available therefor.
MBIA is the principal operating subsidiary of MBIA Inc., a New York Stock Exchange
listed company (the "Company"). MBIA Inc. is not obligated to pay the debts of or claims against
MBIA. MBIA is domiciled in the State of New York and licensed to do business in and subject
to regulation under the laws of all 50 states, the District of Columbia, the Commonwealth of
Puerto Rico, the Commonwealth of the Northern Mariana Islands, the Virgin Islands of the
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September 10, 1998
United States and the Territory of Guam. MBIA has two European branches, one in the
Republic of France and the other in the Kingdom of Spain. New York has laws prescribing
minimum capital requirements, limiting classes and concentrations of investments and requiring
the approval of policy rates and forms, State laws also regulate the amount of both the aggregate
and individual risks that may be insured, the payment of dividends by MBIA, changes in control
and transactions among affiliates. Additionally, MBIA is required to maintain contingency
reserves on its liabilities in certain amounts and for certain periods of time.
Effective February 17, 1998, the Company acquired all of the outstanding stock of Capital
Markets Assurance Corporation ("CMAC") through a merger with its parent CapMAC Holdings
Inc. Pursuant to a reinsurance agreement, CMAC has ceded all of its net insured risks (including
any amounts due but unpaid from third party reinsurers), as well as its unearned premiums and
contingency reserves to MBIA. The Company is not obligated to pay the debts of or claims
against CMAC.
As of December 31, 1997, MBIA had admitted assets of $5.3 billion (audited), total
liabilities of $3.5 billion (audited), and total capital and surplus of $1.8 billion (audited)
determined in accordance with statutory accounting practices prescribed or permitted by
insurance regulatory authorities. As of June 30, 1998, MBIA had admitted assets of $6.0 billion
(unaudited), total liabilities of $4.0 billion (unaudited), and total capital and surplus of $2.0 billion
(unaudited) determined in accordance with statutory accounting practices prescribed or permitted
by insurance regulatory authorities.
Furthermore, copies ofMBIA's year end financial statements prepared in accordance with
statutory accounting practices are available from MBIA. A copy of the Annual Report on Form
10-K of MBIA Inc. is available from MBIA or the Securities and Exchange Commission. The
address of MBIA is 113 King Street, Armonk, New York 10504. The telephone number is
(914) 273-4545.
Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. rates
the claims-paying ability of MBIA "_,"
Fitch mCA, Inc. (formerly known as Fitch Investors Service, L.P.) rates the claims paying
ability of MBIA "_."
Each rating of MBIA should be evaluated independently. The ratings reflect the respective
rating agency's current assessment of the creditworthiness of MBIA and its ability to pay claims
on its policies of insurance. Any further explanation as to the significance of the above ratings
may be obtained only from the applicable rating agency.
The above ratings are not recommendations to buy, sell or hold the Series 1998 Bonds, and
such ratings may be subject to revision or withdrawal at any time by the rating agencies. Any
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September 10, 1998
downward revision or withdrawal of either or both ratings may have an adverse effect on the
market price of the Series 1998 Bonds. MBIA does not guarantee the market price of the Series
1998 Bonds nor does it guarantee that the ratings on the Series 1998 Bonds will not be reversed
or withdrawn.
The insurance provided by this Policy is not covered by the Florida Insurance Guaranty
Association created under Chapter 631, Florida Statutes.
Debt Service Reserve Surety Bond
Application has been made to the MBIA for a commitment to issue a surety bond (the
"Debt Service Reserve Fund Surety Bond"). The Debt Service Reserve Fund Surety Bond will
provide that upon notice from the Paying Agent to MBIA to the effect that insufficient amounts
are on deposit in the Debt Service Fund to pay the principal of (at maturity or pursuant to
mandatory redemption requirements) and interest on the Series 1998 Bonds, MBIA will promptly
deposit with the Paying Agent an amount sufficient to pay the principal of and interest on the
Series 1998 Bonds or the available amount of the Debt Service Reserve Fund Surety Bond,
whichever is less. Upon the later of: (i) three (3) days after receipt by MBIA of a Demand for
Payment in the form attached to the Debt Service Reserve Fund Surety Bond, duly executed by
the Paying Agent, or (ii) the payment date of the Seris 1998 Bonds as specified in the Demand for
Payment presented by the Paying Agent to MBIA, MBIA will make a deposit of funds in an
account with the State Street Bank and Trust Company, N.A., in New York, New York, or its
successor, sufficient for the payment to the Paying Agent, of amounts which are then due to the
Paying Agent (as specified in the Demand for Payment) subject to the Surety Bond Coverage.
The available amount of the Debt Service Reserve Fund Surety Bond is the initial face
amount of the Debt Service Reserve Fund Surety Bond less the amount of any previous deposits
by MBIA with the Paying Agent which have not been reimbursed by the County. The City and
MBIA have entered into a Financial Guaranty Agreement dated October _, 1998 (the
"Agreement"). Pursuant to the Agreement, the City is required to reimburse MBIA, within one
year of any deposit, the amount of such deposit made by MBIA with the Paying Agent under the
Debt Service Reserve Fund Surety Bond. Such reimbursement shall be made only after all
required deposits to the Operation and Maintenance Fund and the Deb Service Fund have been
made.
Under the terms of the Agreement, the Paying Agent is required to reimburse MBIA, with
interest, until the face amount of the Debt Service Reserve Fund Surety Bond is reinstated before
any deposit is made to the General Fund. No optional redemption of the Series 1998 Bonds may
be made until MBIA' s Debt Service Reserve Fund Surety Bond is reinstated. The Debt Service
Reserve Fund Surety Bond will be held by the Paying Agent in the Debt Service Reserve Fund
and is provided as an alternative to the City depositing a part of the funds equal to the Debt
Service Requirement for outstanding Series 1998 Bonds. The Debt Service Reserve Fund Surety
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September 10, 1998
Bond will be issued in the face amount equal to the Maximum Annual Debt Service for the Series
1998 Bonds and the premium therefore will be fully paid by the City at the time of delivery of
the Series 1998 Bonds.
THE REFUNDING PROGRAM
Certain of the proceeds of the Series 1998 Bonds and other legally available funds of the
City shall be deposited irrevocably with , , Florida, or any
successor (the "Escrow Agent") in trust in the escrow account under the terms and provisions of
the Escrow Deposit Agreement (the "Escrow Deposit Agreement"), by and between the City and
the Escrow Holder. Under the Escrow Deposit Agreement, the Escrow Agent will invest such
proceeds in [bonds or other obligations] which as to principal and interest constitute direct
obligations of, or are unconditionally guaranteed by, the United States of America ("Federal
Securities"), none of which permit redemption at the option of the United States of America prior
to the dates on which such Federal Securities shall be applied pursuant to the Escrow Deposit
Agreement in the manner set forth in the Escrow Deposit Agreement], which investments shall
mature at such times and in such amounts as shall be sufficient to pay the principal of and interest
on the Refunded Bonds, as the same shall become due and payable. Bond Counsel will opine at
the time of the delivery of the Series 1998 Bonds that the lien on the Pledged Revenues of that
portion of the Series 1990 Bonds refunded is no longer in effect. Following the delivery of the
Series 1998 Bonds, the Series 1990 Bonds shall be outstanding in the aggregate principal amount
of $1,540,000.
THE SERIES 1998 BONDS
General
The Series 1998 Bonds shall be issued in fully registered form, without coupons, in the
denomination of $5,000 each, or integral multiples thereof, shall be dated, shall bear interest
computed on the basis of a 36O-day year of twelve 30-day months at the rates and shall mature on
the dates and in the amounts shown on the cover page hereof.
The Series 1998 Bonds sh~ll bear interest from the interest payment date next preceding
the date on which it is authenticated, unless authenticated on an interest payment date, in which
case it shall bear interest from such interest payment date, or unless authenticated prior to the first
interest payment date, in which case it shall bear interest from its date. However, if at the time
of authentication payment of any interest which is due and payable has not been made, such
Series 1998 Bond shall bear interest from the date to which interest shall have been paid.
15
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September 10, 1998
The interest on the Series 1998 Bonds shall be payable by the Paying Agent, by check or
draft on each interest payment date, to the registered owner thereof at the address as shown on
the registration books kept by the Registrar at the close of business on the fifteenth day of the
calendar month immediately preceding such interest payment date (the "Record Date"). At the
written request and expense of a registered owner of $1,000,000 or more of Series 1998 Bonds,
interest may be paid to such registered owner by wire transfer or other medium acceptable to the
City and the Paying Agent. Payment of the principal of all Series 1998 Bonds shall be made,
when due, upon the presentation and surrender of such Series 1998 Bonds at the office of the
Paying Agent as the same shall become due and payable.
Only Series 1998 Bonds which have endorsed thereon a certificate of authentication duly
executed by the Registrar, as authenticating agent, shall be entitled to any benefit or security
under the Resolution. No Series 1998 Bond shall be valid or obligatory for any purpose unless
such certificate of authentication shall have been duly executed by the Registrar. The Registrar
shall keep books for the registration of and for the registration of transfers of Series 1998 Bonds
as provided in this Resolution.
In case any Series 1998 Bond shall become mutilated, or be destroyed, stolen or lost, the
City may in its discretion cause to be executed, and the Registrar shall authenticate and deliver,
a new Series 1998 Bond of like maturity, date and tenor as the Bond so mutilated, destroyed,
stolen or lost in exchange and substitution for such mutilated Series 1998 Bond upon surrender
and cancellation of such mutilated Series 1998 Bond or in lieu of and substitution for the Bond
destroyed, stolen or lost, and upon the Holder furnishing the City and the Registrar proof of his
ownership thereof and satisfactory indemnity and complying with such other reasonable
regulations and conditions as the City and the Registrar may prescribe and paying such expenses
as the City and the Registrar may 'incur. All Series 1998 Bonds so surrendered shall be cancelled
by the Registrar. If any of the Series 1998 Bonds shall have matured or be about to mature, instead
of issuing a substitute Series 1998 Bond, the Paying Agent may pay the same, upon the City and
Registrar being indemnified as aforesaid, and if such Series 1998 Bond be lost, stolen or destroyed,
without surrender thereof.
Any such duplicate Series 1998 Bonds issued pursuant to this Section shall constitute
original, additional contractual obligations on the part of the City whether or not the lost, stolen
or destroyed Series 1998 Bonds be at any time found by anyone, and such duplicate Series 1998
Bonds shall be entitled to equal and proportionate benefits and rights as to lien on and source and
security for payment from the Pledged Revenues, to the same extent as all other Series 1998 Bonds
issued hereunder.
Optional Redemption
The Series 1998 Bonds maturing on or prior to October 1, 2006 are not subject to
redemption prior to their respective maturities. The Series 1998 Bonds maturing on or after
16
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September 10, 1998
October 1, 2007 are subject to redemption prior to maturity on or after October 1,2006, at the
option of the City, in whole at any time or in part on any interest payment date in such manner
as shall be determined by the City and by lot within a maturity if less than a full maturity from
any legally available moneys at a redemption price (expressed as a percentage of the principal
amount) as set forth in the following table, plus accrued interest to the redemption date.
Period During Which Redeemed
(aoth dates inclusive)
Redemption
Price
October 1, _ through September 30, _
October 1, _ through September 30, _
October 1, and thereafter
%
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September 10, 1998
Mandatory Redemption
The Series 1998 Bonds which mature on October 1, _ are subject to mandatory
redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal
amount thereof plus interest accrued to the redemption date, beginning on October 1, _' and
on each October 1 thereafter, in the following principal amounts in the years specified:
.~
Principal
Amount
$
*
*Maturity
The Series 1998 Bonds which mature on October 1, _ are subject to mandatory
redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal
amount thereof plus interest accrued to the redemption date, beginning on October 1, _' and
on each October 1 thereafter, in the following principal amounts in the years specified:
~
Principal
Amount
$
*
* Maturity
Notice of Redemption
The Series 1998 Bonds are subject to redemption prior to maturity as herein above
provided. Notice of such redemption shall, at least thirty (30) days prior to the redemption date,
be filed with the Registrar, and mailed, first class mail, postage prepaid, to all Holders of Bonds
to be redeemed at their addresses as they appear on the registration books hereinbefore provided
for, but failure to mail such notice to one or more Holders of Bonds shall not affect the validity
of the proceedings for such redemption with respect to Holders of Bonds to which notice was
duly mailed hereunder. Each such notice shall set forth the date fixed for redemption, the
redemption price to be paid and, if less than all of the Series 1998 Bonds of one maturity are to
be called, the distinctive numbers of such Series 1998 Bonds to be redeemed and in the case of
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September 10, 1998
Series 1998 Bonds to be redeemed'in part only, the portion of the principal amount thereof to be
redeemed.
In addition to the mailing of the notice described above, each notice of redemption shall
(i) be sent at least 35 days before the redemption date and to the extent possible, at least two days
prior to the general date of mailing by registered or certified mail or overnight delivery service
or telecopy to all registered securities depositories then in the business of holding substantial
amounts of obligations of types comprising the Series 1998 Bonds (such depositories now being
The Depository Trust Company, New York, New York, and Midwest Securities Trust
Company, Chicago, lllinois), and to two or more national information services that disseminate
notices of redemption of obligations such as the Series 1998 Bonds, and (ii) be published one time
in The Bond Buyer, New York, New York or, if such publication is impractical or unlikely to
reach a substantial number of the holders of the Series 1998 Bonds to be redeemed, in some other
financial newspaper or journal which regularly carries notices of redemption of other obligations
similar to the Series 1998 Bonds, such publication to be made at least 30 days prior to the date
fixed for redemption; provided, however, that failure of such notice or payment to comply with
the terms of this paragraph shall not in any manner defeat the effectiveness of a call for
redemption if notice thereof is given as otherwise prescribed above in this section. Upon the
payment of the redemption price of Series 1998 Bonds being redeemed, each check or other
transfer of funds issued for such purpose shall bear the CUSIP number identifying, by issue and
maturity, the Series 1998 Bonds being redeemed with the proceeds of such check or other transfer.
A second notice of redemption shall be mailed in the manner provided above to any Bondholder
who has not tendered Series 1998 Bonds that have been called for redemption within sixty (60)
days after the applicable redemption date.
Upon surrender of any Series 1998 Bond for redemption in part only, the Registrar shall
authenticate and deliver to the Bondholder thereof, the cost of which shall be paid by the City,
a new Series 1998 Bond of the same maturity and type and of an authorized denomination equal
to the unredeemed portion of the Series 1998 Bond surrendered.
Transfer and Exchange
The transfer of any Series 1998 Bonds may be registered only upon such books and only
upon surrender thereof to the Registrar together with an assignment duly executed by the
Bondholder or his attorney or legal representative in such form as shall be satisfactory to the
Registrar. Upon any such registration or transfer the City shall execute and the Registrar shall
authenticate and deliver in exchange for such Series 1998 Bond, a new Series 1998 Bond or Series
1998 Bonds registered in the name of the transferee, of the same maturity and type and in an
aggregate principal amount equal to the principal amount of such Series 1998 Bond or Series 1998
Bonds so surrendered.
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Any Series 1998 Bond, upon surrender thereof at the principal corporate trust office of the
Registrar (or if the Clerk is the Registrar, at the office of the Clerk), together with an assignment
duly executed by the Bondholder or his attorney or legal representative in such form as shall be
satisfactory to the Registrar, may, at the option of the Bondholder, be exchanged for an aggregate
principal amount of Series 1998 Bonds equal to the principal amount and of the same type of the
Series 1998 Bond or Series 1998 Bonds so surrendered. The Registrar shall make provision for
the exchange of Bonds at the principal corporate trust office of the Registrar (or if the Clerk is the
Registrar, at the office of the Clerk).
In all cases in which Series 1998 Bonds shall be exchanged, the City shall execute and the
Registrar shall authenticate and deliver, at the earliest practicable time, a new Series 1998 Bond
or Series 1998 Bonds of the same maturity and of the same type in accordance with the provisions
of the Resolution. All Bonds surrendered in any such exchange shall forthwith be canceled by
the Registrar. The City or the Registrar may make a charge for every such exchange of Series
1998 Bonds sufficient to reimburse it for any tax or other governmental charge required to be paid
with respect to such exchange, but no other charge shall be made to any Bondholder for the
privilege of exchanging Series 1998 Bonds under the provisions of the Resolution. Neither the
City nor the Registrar shall be required to make any such exchange of Series 1998 Bonds after the
Record Date.
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September 10, 1998
ESTIMATED SOURCES AND USES OF FUNDS
The proceeds to be received from the sale of the Series 1998 Bonds, including accrued
interest on the Series 1998 Bonds to the date of delivery, are expected to be applied as follows:
Sources of Funds
Principal Amount of Series 1998 Bonds ................... $
Less: Original Issue Discount . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plus: Accrued Interest ................................
Total Sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Uses of Funds
Deposit to Construction Fund (1) ........................ $
Deposit to Escrow Account under the Escrow
Deposit Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deposit of Accrued Interest to Interest Account ............
Costs of Issuance(2) ...................................
Total Uses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ~
(1)
(2)
Moneys used to fund a portion of the Project.
Includes underwriter's discount, costs of issuance and bond insurance and surety bond
premIUms.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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September 10. 1998
SCHEDULED DEBT SERVICE FOR THE SERIES 1998 BONDS
Series 1998 Bonds
Bond Year
Ending
October 1
Principal(l)
Interest
Aggregate
Debt Service
Series 1990 Bonds
Debt Service(2)
Total
Debt Service
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
TOTAL
$164,042.50
160,592.50
162,092.50
163,215.00
163,835.00
164,090.00
163,980.00
163,505.00
162,625.00
161,250.00
164,500.00
162,000.00
164,125.00
160,500.00
161,500.00
161,750.00
161,250.00
$2.764.852.50
(I)
(2)
Includes Amortization Installments for Term Bonds.
Only includes estimated debt service on the Series 1990 Bonds that will remain outstanding following the
issuance of the Series 1998 Bonds.
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September 10, 1998
THE CITY
The City of Ocoee, Florida was incorporated in 1925. It is bounded on the west by
Winter Garden, Florida, and on the south by Windermere, Florida, and has a land area of
approximately 20.5 square miles, making it the second largest city in land area of the thirteen
cities in Orange County. As of April 1998, the population of the City was estimated at 21,007,
which ranks the City third in population of the cities in Orange County.
The City is governed by a Commission-Manager form of government. The four City
Commissioners and the Mayor are elected on staggered two-year terms of office, who in turn
appoint the City Manager.
History and Organization
The City of Ocoee, Florida, is a municipal corporation created under the laws of the State
of Florida. The current Mayor and commissioners, the years in which their terms expire, and
their principal occupations are as follows:
Commissioner
Expiration of Term
Occupation
S. Scott Vandergrift, Mayor
Danny Howell
Nancy J. Parker
Scott A. Glass
Scott Anderson
March, 1999
March, 1999
March, 2000
March, 1999
March, 2000
Real Estate
Construction
Secretary
Attorney
Pilot
For additional information concerning the City, see APPENDIX A - "GENERAL
INFORMATION CONCERNING THE CITY OF OCOEE AND ORANGE COUNTY"
attached hereto.
THE PROJECT
A portion of the proceeds of the Series 1998 Bonds shall be used to fund certain proposed
roadway projects for the City, including but not limited to Maguire Road, Professional Parkway
and Main Street (collectively, the "Project"), each of which is described below. A map depicting
the proposed Project is included on the first page of this Official Statement.
Maguire Road Project
The City is undertaking the improvement of a 1.5 mile segment of Maguire Road that
extends from 1200 feet south of the intersection of Roberson and Moore Roads in a south-north
direction to State Road 50 ("SR 50") due to the increase in projected traffic volumes. Maguire
Road is functionally classified as a collector road. The existing road is a two lane rural section
(open drainage) that overpasses the Florida Turnpike within these limits. The proposed roadway
23
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September 10. 1998
improvement project has been divided into three phases and the total construction cost for this
roadway project is estimated at $8,300,000.
Professional Parkway Project
The City proposes to improve the segment of Professional Parkway that extends from
Maguire Road east to Old Winter Garden Road. The existing road is a two lane rural typical
section with 12 foot lanes, an open drainage system and an existing right-of-way width of 60 feet.
The total length of this roadway project is 0.50 miles and the estimated construction cost
excluding right-of-way costs is $2,400,000.
Main Street Project
Main Street is presently a historical two lane brick road. In order to maintain this road
as a historical preservation site, the City has proposed to realign 0.52 miles of the road from
Chicago Avenue to Maguire Road and to pave 0.28 miles of existing dirt road from Chicago
Avenue to Blackwood Avenue for a total roadway improvement length of 0.80 miles. The
construction cost for this roadway project, excluding right-of-way costs, is estimated to be
$2,100,000.
Additional Projects
To the extent available, the proceeds of the Series 1998 Bonds may also be expended on
certain additional roadway projects of the City, as may be approved by the Commission.
LITIGATION
There is not now pending any litigation restraining or enjoining the issuance or delivery
of the Series 1998 Bonds or the pledge of the Pledged Revenues or questioning or affecting the
validity of the Series 1998 Bonds .or the pledge of the Pledged Revenues or the proceedings and
authority under which they are to be issued and the Pledged Revenues are pledged. Neither the
creation, organization or existence of the City, nor the title of the present Mayor or
commissioners or other officials of the City to their respective offices is being contested.
The City experiences routine litigation and claims incidental to the conduct of its affairs
and the operating of the System. The City carries substantial insurance for these exposures, and
pending claims are defended by and, if necessary, are anticipated to be paid by the insurance
carriers. There is no cause either pending or, to the best knowledge of the City, threatened
against the City which may materially adversely affect the ability of the City to pay the Series
1998 Bonds or adversely affect the general financial condition of the City.
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September 10, 1998
LEGAL MA TIERS
Certain legal matters incident to the validity of the Series 1998 Bonds and the issuance
thereof by the City are subject to the approval of Bryant, Miller and Olive, P .A., Tampa, Florida,
Bond Counsel, whose approving opinion will be printed on the Series 1998 Bonds. Certain legal
matters will be passed upon for the City by Foley & Lardner, Orlando, Florida, City Attorney.
Certain legal matters will be passed upon for the Underwriter by its counsel, Nabors, Giblin &
Nickerson, P .A., Orlando, Florida.
TAX EXEMPTION
General
The Internal Revenue Code of 1986, as amended, establishes certain requirements which
must be met subsequent to the issuance and delivery of the Series 1998 Bonds in order that
interest on the Series 1998 Bonds be and remain excluded from gross income for purposes of
Federal income taxation. Non-compliance may cause interest on the Series 1998 Bonds to be
included in Federal gross income retroactive to the date of issuance of the Series 1998 Bonds,
regardless of the date on which such non-compliance occurs or is ascertained. These requirements
include, but are not limited to, provisions which prescribe yield and other limits within which
the proceeds of the Series 1998 Bonds and the other amounts are to be invested and require that
certain investment earnings on the foregoing must be rebated on a periodic basis to the Treasury
Department of the United States. The City has covenanted in the Resolution to comply with
such requirements in order to maintain the exclusion from Federal gross income of the interest
on the Series 1998 Bonds.
In the opinion of Bond Counsel, assuming compliance with the aforementioned covenants,
under existing laws, regulations, judicial decisions and rulings, interest on the Series 1998 Bonds
is excluded from gross income for purposes of Federal income taxation. Interest on the Series
1998 Bonds is not an item of tax preference for purposes of the Federal alternative minimum tax
imposed on individuals or corporations; however, interest on the Series 1998 Bonds may be
subject to the alternative minimum tax when any Series 1998 Bond is held by a corporation. The
alternative minimum taxable income of a corporation must be increased by 75% of the excess of
such corporation's adjusted current earnings over its alternative minimum taxable income (before
this adjustment and the alternative tax net operating loss deduction). "Adjusted current earnings"
will include interest on the Series 1998 Bonds. The Series 1998 Bonds are exempt from all present
intangible personal property taxes imposed pursuant to Chapter 199, Florida Statutes.
Except as described above, Bond Counsel will express no opinion regarding the Federal
income tax consequences resulting from the ownership of, receipt or accrual of interest on, or
disposition of Series 1998 Bonds. Prospective purchasers of Series 1998 Bonds should be aware
that the ownership of Series 1998 Bonds may result in collateral Federal income tax consequences,
including (1) the denial of a deduction for interest on indebtedness incurred or continued to
purchase or carry Series 1998 Bonds, (2) the reduction of the loss reserve deduction for property
25
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September 10, 1998
and casualty insurance companies by 15% of certain items, including interest on the Series 1998
Bonds, (3) for taxable years beginning before January 1, 1996, the inclusion of interest on Series
1998 Bonds in "modified alternative minimum taxable income" for purposes of the environmental
tax imposed on corporations, (4) the inclusion of interest on the Series 1998 Bonds in earnings of
certain foreign corporations doing business in the United States for purposes of a branch profits
tax, (5) the inclusion of interest on Series 1998 Bonds in passive income subject to Federal income
taxation of certain Subchapter S corporations with Subchapter C earnings and profits at the close
of the taxable year, and (6) the inclusion of interest on the Series 1998 Bonds in "modified adjusted
gross income" by recipients of certain Social Security and Railroad Retirement benefits for
purposes of determining whether such benefits are included in gross income for Federal income
tax purposes.
PURCHASE, OWNERSHIP, SALE OR DISPOSITION OF THE SERIES 1998
BONDS AND THE RECEIPT OR ACCRUAL OF THE INTEREST THEREON MAY
HAVE ADVERSE FEDERAL TAX CONSEQUENCES FOR CERTAIN INDIVIDUAL
AND CORPORATE BONDHOLDERS. PROSPECTIVE BONDHOLDERS SHOULD
CONSULT WITH THEIR TAX SPECIAUSTS FOR INFORMATION IN THAT REGARD.
During recent years legislative proposals have been introduced in Congress, and in some
cases enacted, that altered certain Federal tax consequences resulting from the ownership of
obligations that are similar to the Series 1998 Bonds. In some cases these proposals have contained
provisions that altered these consequences on a retroactive basis. Such alteration of Federal tax
consequences may have affected the market value of obligations similar to the Series 1998 Bonds.
From time to time, legislative proposals are pending which could have an effect on both the
Federal tax consequences resulting from ownership of Series 1998 Bonds and their market value.
No assurance can be given that legislative proposals will not be introduced or enacted that would
or might apply to, or have an adverse effect upon, the Series 1998 Bonds.
Tax Treatment of Original Issue Discount
Under the Code, the difference between the maturity amounts of the Series 1998 Bonds
maturing in the years 2000 through 2010, inclusive, and in the years 2016 and 2026 and the initial
offering price to the public, excluding bond houses, brokers or similar persons or organizations
acting in the capacity of underwriters or wholesalers, at which price a substantial amount of Series
1998 Bonds of the same maturity was sold is "original issue discount." Original issue discount
will accrue over the term of such Series 1998 Bonds at a constant interest rate compounded
periodically. A purchaser who acquires such Series 1998 Bonds in the initial offering at a price
equal to the initial offering price thereof to the public will be treated as receiving an amount of
interest excludable from gross income for federal income tax purposes equal to the original issue
discount accruing during the period he holds such Series 1998 Bonds, and will increase his
adjusted basis in such Series 1998 Bonds by the amount of such accruing discount for purposes
of determining taxable gain or loss on the sale or other disposition of such Series 1998 Bonds.
The Federal income tax consequences of the purchase, ownership and sale or other disposition
of Series 1998 Bonds which are not purchased in the initial offering at the initial offering price
may be determined according to rules which differ from those above. Owners of such Series 1998
26
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September 10, 1998
Bonds should consult their own tax advisors with respect to the precise determination for Federal
income tax purposes of interest accrued upon sale or other disposition of Series 1998 Bonds and
with respect to the state and local tax consequences of owning and disposing of Series 1998 Bonds.
VERIFICATION
The accuracy of the mathematical computations of the adequacy of the maturing principal
amounts and interest on escrow securities and initial cash balances to pay all principal of, interest
on, and redemption premium and accrued interest on the Refunded Bonds through their
redemption dates will be verified by ". Such
verification will be based upon information provided by the Underwriter and the Financial
Advisor.
UNDERWRITING
The Underwriters have agreed, subject to certain conditions, to purchase the Series 1998
Bonds from the City at an aggregate discount of $ , from the initial public offering prices
set forth on the cover page of this Official Statement. The initial public offering prices set forth
on the cover page of this Official Statement include aggregate original issue discount of
$ . The Underwriters' obligation is subject to certain conditions precedent, and they will
be obligated to purchase all of the 'Series 1998 Bonds if any Series 1998 Bonds are purchased. The
Series 1998 Bonds may be offered and sold to certain dealers (including dealers depositing such
Series 1998 Bonds into investment trusts) at prices lower than the public offering prices stated on
the cover page hereof, and such public offering prices may be changed from time to time by the
Underwriter.
CONTINUING DISCLOSURE
The City has covenanted for the benefit of Series 1998 Bondholders to provide certain
financial information and operating data relating to the City and the Series 1998 Bonds in each
year (the "Annual Report"), and to provide notices of the occurrence of certain enumerated
material events. Such covenant shall only apply so long as the Series 1998 Bonds remain
outstanding under the Resolution. The covenant shall also cease upon the termination of the
continuing disclosure requirements of SEC Rule 1 5c2-12 (b) (5) (the "Rule") by legislative, judicial
or administration action. The Annual Report will be filed by the City with each Nationally
Recognized Municipal Securities Information Repository (the "NRMSIRs") described in
"APPENDIX E - FORM OF CONTINUING DISCLOSURE CER TIFICA TE" attached hereto,
as well as any state information depository that is subsequently established in the State of Florida
(the "SID"). The notices of material events will be filed by the City with the NRMSIRs or the
Municipal Securities Rulemaking Board, and with the SID. The specific nature of the information
to be contained in the Annual Report and the notices of material events are described in
"APPENDIX E - FORM OF CONTINUING DISCLOSURE CERTIFICATE," which shall
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September 10, 1998
be executed by the City at the time of issuance of the Series 1998 Bonds. These covenants have
been made in order to assist the Underwriter in complying with the Rule.
With respect to the Series 1998 Bonds, no party other than the City is obligated to
provide, nor is expected to provide, any continuing disclosure information with respect to the
aforementioned Rule. It is the intent of the City that specific performance be the sole remedy for
an event of default under the Continuing Disclosure Certificate.
YEAR 2000 COMPUTER REMEDIATION
[As the year 2000 approaches, computer systems worldwide will undergo a date
transition that may cause majOJ; problems and errors if corrective measures are not taken.
The problem arises in those systems in software programs which use 2-digit date codes.
These codes will recognize the year 2000 as the year 1900, causing many of the systems to
malfunction or fail. The City is currently in the process of evaluating its computer and
information systems and programs (non-financial application) and will take the necessary
steps to modify and test those systems and programs to insure that they are year 2000
compliant prior to January 1,2000. The City cannot, and does not, provide any assurance
that vendors, paying agents and other third parties providing services to the City have or
are effectively dealing with year 2000 issues as the year 2000 approaches.]
RATINGS
It is anticipated that Standard & Poor's Ratings Group, a division of the McGraw Hill
Companies Inc. ("S&P") and Fitch mCA, Inc. ("Fitch") shall assign municipal bond ratings of
"AAA" and "AAA," respectively, to this issue of Series 1998 Bonds with the understanding that
upon delivery of the Series 1998 Bonds, a policy insuring the timely payment of the principal of
and interest on the Series 1998 Bonds will be issued by MBIA Insurance Corporation. In
addition, Fitch is expected to assign an underlying rating of "_" to the Series 1998 Bonds.
Such ratings reflect only the views of the rating agencies, and an explanation of the significance
of such ratings may be obtained from the applicable rating agency. There is no assurance that
such ratings will continue for any given period of time or that they will not be revised or
withdrawn entirely by such rating agencies, if in their judgment, circumstances so warrant. Any
downward revision or withdrawal of such ratings may have an adverse effect upon the market
price of the Series 1998 Bonds.
FINANCIAL STATEMENTS
The audited financial statements of the City for the Fiscal Years ended September 30, 1997
and September 30, 1996, including the audit report, dated November ,1997, of McDirmit,
Davis, Lauteria, Puckett, Vogel & Company, P.A., independent accountants, are set forth in
APPENDIX B hereto. The unaudited financial statements of the City for the nine month period
ended June 30, 1998 and 1997 are also set forth in APPENDIX B hereto
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September 10, 1998
FINANCIAL ADVISOR
The City has retained First Union Capital Markets, A division of Wheat First Securities,
Inc.. ("First Union"), Orlando, Florida, as financial advisor with respect to the issuance of the
Series 1998 Bonds. First Union is not obligated to undertake and has not undertaken to make an
independent verification or to assume responsibility for the accuracy, completeness, or fairness
of the information contained in the Official Statement.
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS
Florida law requires the City to make a full and fair disclosure of any bonds or other
obligations which it has issued or guaranteed and which are or have been in default as to principal
or interest at any time after December 31, 1975 (including bonds or other debt obligations for
which it has served as a conduit issuer). The City is not and has not been in default as to principal
and interest on non-conduit bonds or other debt obligations which it has issued or guaranteed.
The City has not served as a conduit issuer for bonds or other debt obligations.
ENFORCEABILITY OF REMEDIES
The remedies available to the owners of the Series 1998 Bonds upon an event of default
under the Resolution and any policy of insurance referred to herein are in many respects
dependent upon judicial actions which are otten subject to discretion and delay. Under existing
constitutional and statutory law and judicial decisions, including specifically the federal
bankruptcy code, the remedies specified by the Resolution, the Series 1998 Bonds and any policy
of insurance referred to herein may not be readily available or may be limited. The various legal
opinions to be delivered concurrently with the delivery of the Series 1998 Bonds (including Bond
Counsel's approving opinion) will be qualified, as to the enforceability of the remedies provided
in the various legal instruments, by limitations imposed by bankruptcy, reorganization,
insolvency or other similar laws affecting the rights of creditors enacted before or after such
delivery.
MISCELLANEOUS
Any statements made in this Official Statement involving matters of opinion or of
estimates, whether or not so expressly stated, are set forth as such and not as representations of
fact, and no representation is made that any of the estimates will be realized. Neither this Official
Statement nor any statement that may have been made verbally or in writing is to be construed
as a contract with the owners of the Series 1998 Bonds.
The information contained above is neither guaranteed as to accuracy or completeness nor
to be construed as a representation by the City or the Underwriter. The information and
29
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September 10, 1998
expressions of opinion herein are subject to change without notice and neither the delivery of this
Official Statement nor any sale made hereunder is to createt under any circumstancest any
implication that there has been no change in the affairs of the City from the date hereof.
This Official Statement is submitted in connection with the sale of the securities referred
to herein and may not be reproduced or usedt as a whole or in partt for any other purpose. Any
statements in this Official Statement involving matters of opiniont whether or not expressly so
stated are intended as such and not as representations of fact. This Official Statement is not to
be construed as a contract or agreement between the City and the purchasers or the Holders of
any of the Series 1998 Bonds.
CERTIFICATE AS TO OFFICIAL STATEMENT
The execution and delivery of this Official Statement has been duly authorized by the City
Commission of the City. At the time of delivery of the Series 1998 Bonds to the Underwritert
the City will provide to the Underwriter a certificate (which may be included in a consolidated
closing certificate of the CitY)t signed by the City official who signed this Official Statementt
relating to the accuracy and completeness of certain materials in this Official Statement and to its
being a "final official statement" in the judgment of the City Commission for the purpose of SEC
Rule 15c2-12(b)(3).
CITY OF OCOEE, FLORIDA
By:
Mayor
30
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September 10, 1998
APPENDIX A
GENERAL INFORMATION CONCERNING THE CITY OF OCOEE
AND ORANGE COUNTY, FLORIDA
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September 10, 1998
APPENDIX A
GENERAL INFORMATION CONCERNING THE
CITY OF OCOEE AND ORANGE COUNTY, FLORIDA
THE FOLLOWING INFORMATION CONCERNING THE CITY OF
OCOEE, FLORIDA, ORANGE COUNTY, FLORIDA AND THE ORLANDO
METROPOLITAN STATISTICAL AREA IS INCLUDED ONLY FOR THE
PURPOSE OF PROVIDING GENERAL BACKGROUND INFORMATION. THE
INFORMATION HAS BEEN COMPILED ON BEHALF OF THE CITY AND
SUCH COMPILATION INVOLVED ORAL AND WRITTEN COMMUNICATION
WITH THE VARIOUS SOURCES INDICATED. THE INFORMATION IS
SUBJECT TO CHANGE, ALTHOUGH EFFORTS HAVE BEEN MADE TO
UPDATE THE INFORMA nON WHERE PRACTICABLE.
THE SERIES 1998 BONDS ARE NOT GENERAL OBLIGATIONS OF THE
STATE OF FLORIDA OR ANY POLITICAL SUBDIVISION THEREOF,
INCLUDING THE CITY OF OCOEE.
General Description and Location
The City of Ocoee, Florida (the "City") is a residential community in the western part of
Orange County, Florida (the "County") and was incorporated in 1925. It is bounded on the west
by Winter Garden, and on the south by Windermere, and has a land area of approximately 20
square miles, thus making it the second largest city in land area of the thirteen cities in Orange
County. State Roads 50, 437 and 438 are major roads providing easy access to City residents. The
Florida Turnpike, the East-West Expressway and State Road 50 all pass through the City limits.
The Western Beltway will also be accessible within the City limits. As of April, 1998, the
population of the City was estimated at 21,007. The City ranks third in population of the cities
in Orange County. The average household income, as estimated by the West Orange Chamber
of Commerce for West Orange County, is $ 47,900 and the median age of an Orange County
resident is 32.5 years of age.
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September 10, 1998/gst
Population
The following table sets forth historical and projected population trends in the City of
Ocoee, Orange County, and the State of Florida from years 1960 through 2010:
Yw Population Change Population Change Population Change
1996 19,261 777,556 14,411,563
1995 18,578 45.4% 758,962 12.0% 14,149,317 9.4%
1990 12,778 63.8 677,491 43.9 12,938,071 32.7
1980 7,803 98.2 470,865 36.8 9,746,424 43.5
1970 3,937 57.5 344,311 30.6 6,791,418 37.2
1960 2,500 263,540 4,951,560
Source: U.S. Census Bureau; Population Studies Population Program, Bureau of Economic
and Business Research, University of Florida; City of Ocoee.
Government
The City is governed by a Commission-Manager form of government. The four City
Commissioners and the Mayor are elected on staggered two-year terms of office, who in turn
appoint the City Manager. Listed below are the current Mayor and City Commissioners and
their respective term expiration dates:
Members
S. Scott Vandergrift, Mayor
Danny Howell, Commissioner
Nancy J. Parker, Commissioner
Scott A. Glass, Commissioner
Scott Anderson, Commissioner
Term Expires
March 1999
March 1999
March 2000
March 1999
March 2000
Police and Fire Protection
Approximately 53 law enforcement personnel and 44 fire protection personnel provide
24-hour police and fire protection.
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Recreation
The City has ten parks and an 18-hole public golf course. Major public recreational
facilities include tennis courts, outdoor basketball courts, a football field and baseball fields, as
well as several picnic areas, playground equipment, walking trails and boat launching facilities.
A new multi-purpose recreational complex is being constructed and will include a full-size
gymnasium, soccer and basebalV softball fields, a municipal swimming pool and nature trails. The
City has an active summer recreation program for children and many other organized sporting
and leisure activities for all its citizenry.
Budget Preparation
Pursuant to Florida law, on July 1, the Property Appraiser of Orange County certifies the
tax roll. On July 31, the City submits to the Property Appraiser the proposed millage as well as
the date, time, and place of the first public hearing. The first public hearing on the budget is held
by mid-September, at which time the City Commission reviews the recommended budget,
making adjustments as it deems appropriate. By September 30, the budget is adopted by
ordinance, and the millage rate and other revenues are set to fund the operating budget.
Employee's Defined Pension Plan and Trust - [Update]
The City contributes to a defined benefit pension plan and trust. As of September 30,
1995, the plan was amended by separating the program into separate plans for general employees,
police officers and firefighters. The assets were allocated as follows:
General Employees
Police Officers and Firefighters
$1,228,539
$1,384,589
City Employees of the City are required to contribute 7.4% of salary to the plan and
police and firefighters contribute 7.6% of salary to the plan. The normal retirement benefit is 2%
of average final compensation for each year of credited services. The normal retirement age is 60.
Average compensation is based on the highest five (5) years of last ten (10) years of service.
Benefits fully vest on reaching five (5) years of service. The plan provides death but not disability
benefits. These benefit provisions and all other requirements are established by City ordinance.
A-3
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September 10, 1998/gst
Employment
ECONOMIC SUMMARY
Prior to 1967, the Orlando Metropolitan Statistical Area ("MSA") economy was based
upon agricultural and citrus products, tourism, light manufacturing and industries relating to the
space program at the Kennedy Space Center at Cape Canaveral. Since 1967, construction of Walt
Disney World, EPCOT Center, Pisney-MGM Studios, Sea World, Universal Studios Florida and
other tourist attractions, together with increasing convention activity, have played an important
part in the local economy. This has resulted in a larger percentage of total employment in the
Orlando MSA consisting of trade and service jobs as compared to the national average.
Calendar
Year
1998
1997
1996
1995
1994
1993
1992
Orange County Labor Force Estimates
1992-1998
Civilian U neII\Ployment Rate
Labor Orange State of United
Force Employed Unemployed County Florida ~
470,017 455,960 14,057 3.0 4.3 4.2
448,998 434,490 14,508 3.2 4.7 4.7
437,031 420,210 16,821 3.8 5.3 5.5
443,472 422,602 20,870 4.7 5.5 5.2
426,155 401,471 24,684 5.8 6.6 6.1
410,216 384,758 25,458 6.2 7.0 6.8
398,327 368,940 29,387 7.4 8.2 7.4
Sources:
1990-1994: Florida' Statistical Abstract~; 1995-1998: Florida Department of Labor
and Employment Security, Division of Jobs and Benefits, Bureau of Labor and
Market Performance Information.
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Largest Employers in Orlando MSA Area - 1998
Name of Employer
# of Employees
1. Walt Disney World Co.
2. Orange County Public Schools
3. Florida Hospital
4. Publix Supermarkets, Inc.
5. Orange County Government
6. Orlando Regional Healthcare System
7. Seminole County Public Schools
8. Winn Dixie Stores
9. Universal Studios
10. Lockheed Martin
11. AT&T Information Systems
40,000
22,000
11,597
9,515
8,608
8,100
6,456
6,270
6,000
5,920
5,000
Source:
Economic Development Commission of Mid-Florida, Inc.
Largest Employers in the City of Ocoee, Florida - 1998
Name of Employer
# of Employees
1. Health Central
2. Sysco Foods, Inc.
3. Florida Auto Auction
4. Publix Supermarkets, Inc.
5. Dillard's
6. Gayfer's
7. Sears
8. JCPenney's
9. Winn Dixie Stores
10. Wal-Mart
529
500
426
325
305
283
232
190
180
170
Source:
City of Ocoee, Florida.
In the City there are several major employers, including Health Central Hospital, Sysco
Foods, Inc., the Florida Auto Auction, Publix Supermarkets, and the West Oaks Mall. The City's
industrial base is diverse, ranging from stained glass artistry to casket and burial vault production.
A-5
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September 10, 1998/gst
Personal Income Per Capita
1990-1995
Yw
1995
1994
1993
1992
1991
1990
Orange County
$21,868
State of Florida
$22,764
21,677
20,650
19,664
19,180
18,692
19,570
18,861
18,154
17,916
Sources:
1990-1993: 1995 Florida Statistical Abstract
1994-1995: 1997 Florida Statistical Abstract.
Effective Buying Income
January 1, 1996
Orange County
State of Florida
Average Household EBI
Median Household EBI
Per Capita EBI
Less Than 20,000
20,000 - 34,999
35,000 - 49,999
50,000 and over
$40,787
$30,830
$16,036
30.9%
25.3%
17.8%
26.0%
$43,671
$34,614
$16,418
25.0%
25.6%
19.6%
29.8%
United States
$21,979
21,809
20,800
20,137
19,163
18,696
United States
$42,191
$33,482
$15,555
30.0%
22.9%
18.0%
29.1%
Source:
Market Statistics, 1996 Demographics USA - County Edition.
Sales and Marketing Management, 1998 Survey of Buying Power
Education
The Orlando area has four major institutions of higher learning: University of Central
Florida (a four-year state university with an enrollment of 28,500 full and part-time students);
Rollins College (the oldest four-year institution of higher learning in Florida, an independent,
coeducational, liberal arts college with an enrollment of more than 1,400 day-time students and
3,356 total students); Seminole Community College (a two-year undergraduate institution with
approximately 35,000 students annually); and Valencia Community College (the fourth largest
of Florida's 28 community colleges, a two-year undergraduate institution covering six campuses
with over 60,000 full and part-time students).
A-6
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September 10, 1998/gst
Public School enrollment'for the 1996-1997 school year in Orange County was 235,879
(from County School Board 1996-1997 School Year Statistics).
Source:
Economic Development Commission of Mid-Florida, Inc., 1996 Opportunity
Orlando.
Transportation
The Orlando MSA is primarily served by Orlando International Airport ("OIA"), which
is the 16th busiest domestic airport facility and the 24th busiest world airport facility. OIA is the
largest port of entry for international passengers and fastest growing major international airport
in the world, accommodating more than 2.5 million passengers on international flights from
Europe, Mexico, Canada, the Caribbean and Central and South America. Air passengers have
increased from 18.4 million in 1991 to 26.7 million in 1998. OIA is the third largest airport in
the country in terms of property size.
Eighty-Six scheduled carriers serve OIA with 1,050 departures and arrivals daily,
including direct and international flights. More than 100 U.S. and international cities are served
by direct and nonstop flights from OIA, the most of any airport in Florida. In addition to
scheduled airlines, more than 30 scheduled charter companies serve the Orlando MSA.
The Orlando MSA is also served by three general aviation airports: Orlando Executive
Airport, Orlando Sanford Airport and Kissimmee Municipal Airport.
The Orlando MSA is also served by 35 common-carrier truck lines, most of which have
local terminals and several parcel delivery and package express services covering Orange County
and neighboring communities. Greyhound, Gray Line, Superior and Trailways Bus Lines offer
charter, express and passenger services. Both passenger and freight rail systems provide service
to the area. Amtrak currently operates two trains daily between New York and South Florida
which travel through Metro Orlando. Amtrak stops at four stations in the area: Sanford, Winter
Park, Orlando and Kissimmee. Rail passenger stations in the area are among the busiest in the
southeast, with approximately 400 Amtrak passengers arriving and departing daily. CSX
Transportation moves freight between north and south Atlantic points and connects with all
major rail lines in the United States.
Three major limited-access highways bisect the area: (1) Interstate 4 runs east and west
across Florida from Daytona Beach and Interstate 95 on the Atlantic coast of Florida to Tampa
and Interstate 75 near the Gulf coast of Florida; (2) Florida's Turnpike runs north and south from
Interstate 75 near Ocala, Florida to Miami; and (3) Interstate 75, which extends through Georgia
and the midwestern part of the United States. Other highways serving the area include U.S.
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September 10, 1998/gst
Highways 441, 17-92,27 and 192, as well as numerous state roadways and toll roads. The Bee
Line Expressway (State Road 528) provides direct limited access to Kennedy Space Center, Port
Canaveral and the beaches along the Atlantic coast of Florida. The East-West Expressway (State
Road 408) expedites traffic through the metropolitan Orlando and is connected by full
interchanges with Interstate 4 and with Florida's Turnpike. To address road transportation needs,
four mid-Florida county governments have combined efforts to construct a 100-mile, limited-
access beltway encircling metropolitan Orlando called the Central Florida Greeneway (the
"GreeneWay").
[REMAINDER OF P AGE INTENTIONALLY LEFT BLANK]
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September 10, 1998/gst
Public transportation is provided by 235 Lynx buses, run by the nationally recognized
transportation system serving Orange, Seminole and Osceola Counties. Included in its regularly
served 47 routes are stops at shopping centers, government complexes, schools, financial
institutions, industrial and commercial centers and tourist attractions. The FreeBee, a no-cost bus
service for those getting around in downtown Orlando, is also available. Another transit route,
the " Lymmo, " provides free ridership in downtown Orlando through a 3-mile loop in the urban
core of the City.
Source:
Economic Development Commission of Mid-Florida, Inc., 1998 Opportunity
Orlando and the City of Ocoee, Florida.
Levy of Taxes
Each year the County Property Appraiser is required to certify to each taxing authority,
the aggregate taxable value of all property within the jurisdiction of the taxing authority, as well
as the prior year's tax revenues, for use in connection with determination of the forthcoming
budget and millage levy. In connection with such determination, the taxing authority must hold
a public hearing in connection with the adoption of a tentative budget and millage levy and
another hearing relating to adoption of the final budget and millage levy.
City of Ocoee, Florida
Property Tax Rates and Tax Levies
Direct and Overlapping Governments
1993-1997
Millage Rates (per $1,000 of taxable value)
Fiscal City of Orange School
~ Ocoee County ~ Total
1997 4.00 5.2889 9.077 18.4650
1996 4.00 5.2889 9.375 18.6630
1995 4.00 5.2889 9.324 18.6129
1994 4.00 5.2889 8.930 18.2189
1993 4.00 5.2889 8.930 18.2189
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September 10, 1998/gst
Fiscal
Ym
1998
1997
1996
1995
1994
1993
Source:
Taxes Levied and Collected
City of Ocoee, Florida
1993-1998
Taxable Total
Assessed Tax Total Tax
Valuation Levy Collections Delinq.uent
$751,226,256 $2,981,477 N/A N/A
546,637,911 2,329,421 $2,243,488 $1,388
505,656,888 [2,022,628] 2,173,162 2,247
469,310,003 1,877,240 1,803,405
424,437,664 1,697,751 1,647,742 1,753
375,807,867 1,503,231 1,455,968 4,941
% of Total
Collections
to Levy
96.31 %
96.07
97.05
96.86
1993-1995: Comprehensive Annual Financial Report of the City of Ocoee, Florida
for the Fiscal Year Ended September 30, 1995.
1996-1998: City of Ocoee, Florida.
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September 10, 1998/gst
. City of Ocoee, Florida
Schedule of Ten Largest Taxpayers
, 199_
T axpc\yer
1. GGP/Homart Inc.
2. Merchantile Properties, Inc.
3. Manhein Remarketing, L.P.
4. Oak Forest Partners, Ltd.
5. Dillard Department Stores, Inc.
6. Good Homes Plaza
7. Sears Roebuck & Co.
8. West Orange Health Care District
9. Lake Olympia Square Partnership
10. Westlake Partners, Ltd.
Type of Business
West Oaks Mall
Developer
Developer
Developer
Retail Sales
Shopping Center
Retail Sales
Health Care
Shopping Center
Developer
Total Taxable Assessed Value of ~O Largest Taxpayers
T otal Taxable Assessed Value of Other Taxpayers
Total Taxable Value of All Taxpayers
[1997 Orange County Tax Roll].
Source:
A-ll
Valuation
$64,187,905
11,302,187
10,701,814
10,458,431
10,457,550
9,564,599
8,088,499
7,890,085
6,653,105
6.545.421
145,849,596
623r050.514
~768.900.11Q
Percentage
8.3%
1.5
1.4
1.4
1.4
1.2
1.1
1.0
0.9
Q.2
19.0
...8.1.Q
~%
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September 10, 1998/gst
:fur
1997
1996
1995
1994
1993
1992
City of Ocoee, Florida
Construction Property Value and Bank Deposits
1992-1997
Residential Construction (1)
Number of Units
Single- Multi-
Family Family
497 0
366 0
331 0
402 0
411 0
438 0
Bank Deposits(2)
(in thousan~
Savings
& Loans
793,849
859,921
828,351
1,078,501
1,133,135
2,936,546
Property
Value
44,475,342
33,871,752
28,836,036
35,211,374
36,188,257
36,622,069
Banks
7,128,190
6,937,918
6,147,414
5,874,598
5,743,997
5,614,174
(1) Source: City of Ocoee Building Department
(2) Source: Florida Bankers Association. Figures represent deposits for Orange County as of
September 30 of such year.
A-12
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September 10, 1998/gst
City of Ocoee, Florida
Debt Statement
September 30, 1997
Direct City Debt
General
Obligation
Debt
Capital Improvement Revenue Bonds,
Series 1991 due 10/1/2011
Transportation Refunding and
Improvement Revenue Bonds,
Series 1990 due 10/1/2015
Stormwater Utility Bonds, Series 1996
Water and Sewer System Refunding
and Improvement Bonds, Series
1993 due 10/1/2017
Capital Improvement Revenue
Promissory Note, Series 1996
Due 01/01/2012
Total Direct Debt
$ -0-
Overlapping Debt - Orange County
Library District Library Refunding
Bonds, Series 1993
$9,205.000
Total Overlapping Debt
$9,205,000
% City's Share of Overlapping Debt
City's Share of Overlapping Debt
1.43%
$ 131,632
Total Direct and Overlapping Debt
1.Ul.632
Sources:
City of Ocoee and Orange County, Florida.
A-13
Non-Self
Supporting
Debt
$2,205,000
6,215,000
$8,420,000
$8,420.000
Self-
Supporting
Debt
$ 2,200,000
7,850,000
4.610.000
$14,660,000
111.660.000
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September 10, 1998/gst
City of Ocoee, Florida
Comparative Ratios of Bonded Debt
September 30, 1997
1. 1997 Population
20,560
2. 1997 Total Assessed Valuation
$745,369,179
3. 1997 Taxable Assessed Valuation
$654,450,087
4. Direct and Overlapping General Obligation Debt Per Capita
$6.41
5. Direct and Overlapping General Obligation Debt and Self-Supporting Debt
Per capita
As a percent of total assessed valuation
As a percent of taxable assessed valuation
$713.04
1.97%
2.24%
6. Direct and Overlapping General Obligation Debt and Non-Self Supporting Revenue Debt
Per capita $415.94
As a percent of total assessed valuation 1.15%
As a percent of taxable assessed valuation 1.31 %
Source: City of Ocoee, Florida.
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September 10, 1998/gst
APPENDIX B
AUDITED AND UNAUDITED FINANCIAL STATEMENTS OF THE CITY
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September 10, 1998
APPENDIX C
SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION
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September 10, 1998
APPENDIX D
FORM OF BOND COUNSEL'S LEGAL OPINION
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September 10, 1998
APPENDIX E
FORM OF CONTINUING DISCLOSURE CERTIFICATE
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September 10, 1998
APPENDIX E
CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and
delivered by the City of Ocoee, Florida (the "City") in connection with the issuance of its
$ Transportation Refunding and Improvement Revenue Bonds, Series 1998
(the "Series 1998 Bonds"). The Series 1998 Bonds are being issued pursuant to the City's
Resolution No. 90-08, adopted by the City Commission of the City on August 21, 1990, as
amended and supplemented by Resolution No. 98-_, adopted by the City Commission of
the City on September 15, 1998 (collectively, the "Resolution"). The City covenants and
agrees as follows:
SECTION 1. PURPOSE OF DISCLOSURE CERTIFICATE. This Disclosure
Certificate is being executed and delivered by the City for the benefit of the Series 1998
Bondholders and in order to assist the original underwriter of the Series 1990 Bonds in
complying with Rule 15c2-12(b)(5) promulgated by the Securities and Exchange
Commission ("SEC") pursuant to the Securities Exchange Act of 1934 (the "Rule").
SECTION 2. PROVISION OF ANNUAL INFORMATION. Except as otherwise
provided herein, the City shall provide to all of the nationally recognized municipal
securities information repositories described in Section 4 hereof (the "NRMSIRs"), and to
any state information depository that is established within the State of Florida (the "SID")
on or before April 30 of each y~ar, commencing April 30, 1999, the information set forth
below in this Section 2. Notwithstanding the immediately preceding sentence, to the extent
any such information does not become available to the City before on April 30 of any year,
the City shall provide such information when it becomes available, but no later than one year
following the end of the City's Fiscal Year.
(A) the City's Comprehensive Annual Financial Report for the immediately
preceding Fiscal Year (the "CAFR"), which shall include the audited financial statements
of the City for the immediately preceding Fiscal Year prepared in accordance with Generally
Accepted Accounting Principles, as modified by applicable State of Florida requirements
and the governmental accounting standards promulgated by the Government Accounting
Standards Board; provided, however, if the audited financial statements of the City are not
completed prior to on April 30 of any year, the City shall provide unaudited financial
statements on such date and shall provide the audited fmancial statements within 30 days of
the completion of such audited financial statements; and
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September 10, 1998
(B) to the extent not set forth in the CAFR, additional financial information and
operating data of the type included with respect to the City in the final official statement
prepared in connection with the sale and issuance of the Series 1998 Bonds (as amended,
the "Official Statement"), as set forth below:
1. Updates of information set forth in the Official Statement relating to:
[TO COME]
2. Description of any indebtedness payable in whole or in part from the
Pledged Funds (as defined in the Official Statement).
3. Description of any material litigation which would have been disclosed
in the Official Statement if such litigation had occurred and been ongoing at the time
the Official Statement is dated.
4. Any other financial information or operating data of the type included
in the Official Statement which would be material to a holder or prospective holders
of the Series 1998 Bonds.
For purposes of this Disclosure Certificate, "Fiscal Year" means the period
commencing on October 1 and ending on September 30 of the next succeeding year, or such
other period oftime provided by applicable law.
SECTION 3. REPORTING SIGNIFICANT EVENTS. The City shall provide
to the NRMSIRs or the Municipal Securities Rulemaking Board (the "MSRB") and to the
SID, on a timely basis, notice of any of the following events, if such event is material with
respect to the Series 1998 Bonds or the City's ability to satisfy its payment obligations with
respect to the Series 1998 Bonds:
(A) Principal and interest payment delinquencies;
(B) Non-payment related defaults;
(C) Unscheduled draws on the debt service reserve fund reflecting financial
difficulties;
(D) Unscheduled draws on credit enhancement reflecting financial difficulties;
(E) Substitution of credit or liquidity providers, or their failure to perform;
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September 10, 1998
(F) Adverse tax opinions or events affecting the tax-exempt status of the Series
1998 Bonds;
(G) Modifications to rights of Series 1998 Bondholders;
(H) Calls on the Series 1998 Bonds;
(I) Defeasance of the Series 1998 Bonds;
(J) Release, substitution, or sale of property securing repayment of the Series 1998
Bonds;
(K) Rating changes; and
(L) Notice of any failure on the part of the City or any other Obligated Person (as
dermed herein) to meet the requirements of Section 2 hereof.
The City may from time to time, in its discretion, choose to provide notice of the
occurrence of certain other events, in addition to those listed in this Section 3, if, in the
judgment of the City, such other events are material with respect to the Series 1998 Bonds,
but the City does not specifically undertake to commit to provide any such additional notice
of the occurrence of any material event except those events listed above.
Whenever the City obtains knowledge of the occurrence of a significant event
described in this Section 3, the City shall as soon as possible determine ifsuch event would
be material under applicable federal securities law to holders of Series 1998 Bonds,
provided. that any event under clauses (D), (E), (F), (K) or (L) above will always be deemed
to be material.
SECTION 4. NRMSIRs. The NRMSIRs to which the City shall provide the
information described in Sections 2 and 3 above, to the extent required, shall be the
following organizations, their successors and assigns:
(A) Bloomberg MuniCipal Repository
P.O. Box 840
Princeton, New Jersey 08542-0840
Phone: 609/279-3200
Fax: 609/279-5962
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September 10, 1998
(B) Thomson NRMSIR
Attn: Municipal Disclosure
395 Hudson Street, 3rd Floor
New York, New York 10014
Phone: 212/807-5001
Fax: 212/989-2078
(C) Disclosure, Inc.
5161 River Road
Bethesda, Maryland 20816
Attn: Document Acquisitions/Municipal Securities
Phone: 301/951-1450 (City-related questions)
800/638-8241 (for purchase of documents)
Fax: 301/718-2329
(D) Moody's NRMSIR
Public Finance Information Center
99 Church Street
New York, New York 10007
Phone: 212/553-0300
Fax: 212/553-1460
(E) Kenny Information Systems, Inc.
65 Broadway, 16th Floor
New York, New York 10006
Phone: 212/770-4595
Fax: 212/797-7994
(F) Donnelley Financial
Municipal Securities Disclosure Archive
559 Main Street
Hudson, Massachusetts 01749
Phone: 800/580-3670
Fax: 508/562-1969
(G) Any NRMSIRs that are established subsequently and approved by the SEC.
(H) A list of the names and addresses of all designated NRMSIRs as of any date
may currently be obtained by calling the SEC's Fax on Demand Service at 202/942-8088 and
requesting document number 0206.
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September 10, 1998
SECTION 5. NO EVENT OF DEFAULT. Notwithstanding any other provision
in the Resolution to the contrary, failure of the City to comply with the provisions of this
Disclosure Certificate shall not be considered an event of default under the Resolution;
provided, however, any Series 1998 Bondholder may take such actions as may be necessary
and appropriate, including pursuing an action for mandamus or specific performance, as
applicable, by court order, to cause the City to comply with its obligations hereunder. For
purposes of this Disclosure Certificate, "Series 1998 Bondholder" shall mean any person
who (A) has the power, directly or indirectly, to vote or consent with respect to, or to dispose
of ownership of, any Series 1998 Bonds (including persons holding Series 1998 Bonds
through nominees, depositories or other intermediaries), or (B) is treated as the owner of any
Series 1998 Bond for federal income tax purposes. It is the City's intent that specific
performance be the sole remedy for an event of default under this Disclosure Certificate.
SECTION 6. INCORPORATION BY REFERENCE Any or all of the
information required herein to be disclosed may be incorporated by reference from other
documents, including official statements or debt issues of the City of related public entities,
which have been submitted to each of the NRMSIRs and the SID, if any, or the SEC. If the
document incorporated by reference is a final official statement, it must be available from
the MSRB. The City shall clearly identifY each document incorporated by reference.
SECTION 7. DISSEMINATION AGENTS. The City may, from time to time,
appoint or engage a dissemination agent to assist it in carrying out its obligations under this
Disclosure Certificate, and may discharge any such agent, with or without appointing a
successor dissemination agent.
SECTION 8. TERMINATION. The City's obligations under this Disclosure
Certificate shall terminate upon (A) the legal defeasance, prior redemption or payment in full
of all of the Series 1998 Bonds, or (B) the termination of the continuing disclosure
requirements of the Rule by legislative, judicial or administrative action.
SECTION 9. AMENDMENTS. Notwithstanding any other provision of this
Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision
may be waived, if such amendment or waiver is supported by an opinion of counsel that is
nationally recognized in the area of federal securities laws, to the effect that such amendment
or waiver would not, in and of Itself, cause the undertakings herein to violate the Rule if
such amendment or waiver had been effective on the date hereof but taking into account any
subsequent change in or official interpretation of the Rule.
SECTION 10. ADDITIONAL INFORMATION. Nothing in this Disclosure
Certificate shall be deemed to prevent the City from disseminating any other information,
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September 10, 1998
using the means of dissemination set forth in this Disclosure Certificate or any other means
of communication, or including any other information in its annual information described
in Section 2 hereof or notice of occurrence of a significant event described in Section 3
hereof, in addition to that which is required by this Disclosure Certificate. If the City
chooses to include any information in its annual information or notice of occurrence of a
significant event in addition to that which is specifically required by this Disclosure
Certificate, the City shall have no obligation under this Disclosure Certificate to update such
information or include it in its future annual information or notice of occurrence of a
significant event.
SECTION 11. OBLIGATED PERSONS. If any person, other than the City,
becomes an Obligated Person (as defmed in the Rule) relating to the Series 1998 Bonds, the
City shall use its best efforts to require such Obligated Person to comply with all provisions
of the Rule applicable to such Obligated Person.
Dated:
CITY OF OCOEE, FLORIDA
By:
S. Scott Vandergrift, Mayor
Executed on:
, 1998
ATTEST:
Jean Grafton, City Clerk
(SEAL)
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September 10, 1998
APPENDIX F
SPECIMEN COpy OF MUNICIPAL BOND INSURANCE POLICY
Q:\03198\pos.3.wpd
September 10, 1998
EXHffiIT D
MUNICIPAL BOND INSURANCE COMMITMENT
MBIA
Exhibit D
COMMITMENT TO ISSUE A
FINANCIAL GUARANTY INSURANCE POLICY
Application No.: 1998-007701-01
Sale Date: August 1998 (T)
Program Type: Negotiated DP
Re: $18,000,000 (Est.) City of Ocoee, Florida, Transportation Refunding and Improvement
Revenue Bonds, Series 1998
(the "Obligations")
This commitment to issue a financial guaranty insurance policy (the "Commitment")
dated August 21, 1998, constitutes an agreement between CITY OF OCOEE, FLORIDA the
("Applicant") and MBIA Insurance Corporation (the "Insurer"), a stock insurance company
incorporated under the laws of the State of New York.
Based on an approved application dated August 19, 1998, the Insurer agrees, upon
satisfaction of the conditions herein, to issue on the earlier of (i) 120 days of said approval date
or (ii) on the date of delivery of and payment for the Obligations, a financial guaranty insurance
policy (the "Policy") for the Obligations, insuring the payment of principal of and interest on the
Obligations when due. The issuance of the Policy shall be subject to the following terms and
conditions:
1. Payment by the Applicant, or by the Trustee on behalf of the Applicant, on the date
of delivery of and payment for the Obligations, of a nonrefundable premium in the amount of
.475% (premium rate) of total debt service, premium rounded to the nearest thousand. The
premium set out in this paragraph shall be the total premium required to be paid on the Policy
issued pursuant to this Commitment.
2. The Obligations shall have received the unqualified opinion of bond counsel with
respect to the tax-exempt status of interest on the Obligations.
3. There shall have been no material adverse change in the Obligations or the
Resolution, Bond Ordinance, Trust Indenture or other official document aut40rizing the issuance
of the Obligations or in the [mal official statement or other similar document, including the
financial statements included therein. .
4. There shall have been no material adverse change in any information submitted to
the Insurer as a part of the application or subsequently submitted to be a part of the application
to the Insurer.
5. No event shall have occurred which would allow any underwriter or any other
purchaser of the Obligations not to be required to purchase the Obligations at closing.
6. A Statement of Insurance satisfactory to -'the Insurer shall be printed on the
Obligations. "
7. Prior to the delivery of and payment for the Obligations, none of the information or
documents submitted as a part of the application to the Insurer shall be determined to contain
any untrue or misleading statement of a material fact or fail to state a material fact required to
be stated therein or necessary in order to make the statements contained therein not misleading.
.MBIA
8. No material adverse change affecting any security for the Obligations shall have
occurred prior to the delivery of and payment for the Obligations.
9. This Commitment may be signed in counterpart by the parties hereto.
10. The Local Option Gas Tax received by the City must be extended beyond the
maturity of the bonds before the public service tax release test can be applied. The release test
requirement is as follows: during each of the two preceding complete fiscal years, the local
option gas tax revenue must be at least equal to 1.3 5x MADS on existing and proposed bonds.
11. Compliance with the Insurer's General Document Provisions (see attached).
12. Compliance with the Insurer's Standard Conditions for Refundings (see attached).
Dated this 21st day of August, 1998.
MBIA Insurance Corporation
~(~@L_
By
Assistant Secretary
CITY OF OCOEE, FLORIDA
By:
Title:
.MSIA
GENERAL DOCUMENT PROVISIONS
A. Notice to the Insurer The basic legal documents must provide that any notices required to
be given by any party should also be given to the Insurer, Attn: Insured Portfolio
Management.
B. Amendments. In the basic legal document, there are usually two methods of amendment.
The first, which typically does not require the consent of the bondholders, is for
amendments which will cure ambiguities, correct formal defects or add to the security of
the fmancing. The second, in which bondholder consent is a prerequisite, covers the more
substantive types of amendments. For all financings, the Insurer must be given notice of
any amendments that are of the first type and the Insurer's consent must be required for all
amendments of the second type. All documents must contain a provision which requires
copies of any amendments to such documents which are consented to by the Insurer to be
sent to Standard & Poor's.
C. Supplemental Legal Document. If the basic legal document provides for a supplemental
legal document to be issued for reasons other than (1) a refunding to obtain savings; or (2)
the issuance of additional bonds pursuant to an additional bonds test, there must be a
requirement that the Insurer's consent also be obtained prior to the issuance of any
additional bonds and/or execution of such supplemental legal document.
D. Events of Default and Remedies. All documents normally contain provisions which define
the events of default and which prescribe the remedies that may be exercised upon the
occurrence of an event of default. At a minimum, events of default will be defmed as
follows:
1. the issuer/obligor fails to pay principal when due;
2. the issuer/obligor fails to pay interest when due;
3. the issuer/obligor fails to observe any other covenant or condition of the document
and such failure continues for 30 days and
4. the issuer/obligor declares bankruptcy.
The Insurer, acting alone, shall have the right to direct all remedies in the event of a default. The
Insurer shall be recognized as the registered owner of each bond which it insures for the purposes
of exercising all rights and privileges available to bondholders. For bonds which it insures, the
Insurer shall have the right to institute any suit, action, or proceeding at law or in equity under
the same terms as a bondholder in accordance with applicable provisions of the governing
documents. Other than the usual redemption provisions, any acceleration of principal payments
must be subject to the Insurer's prior written consent.
E. Defeasance requires the deposit of:
1. Cash
2. U.S. Treasury Certificates, Notes and Bonds (including State and Local Government
Series -- " SLGs")
MElL4
3. Direct obligations of the Treasury which have been stripped by the Treasury itself,
CATS, TIGRS and similar securities
4. Resolution Funding Corp. (REFCORP) Only the interest component of REFCORP
strips which have been stripped by request to the Federal Reserve Bank of New York in
book entry form are acceptable.
5. Pre-refunded municipal bonds rated "Aaa" by Moody's and "AAA" by S&P. If
however, the issue is only rated by S&P (i.e., there is no Moody's rating), then the pre-
refunded bonds must have been pre-refunded with cash, direct U.S. or U.S. guaranteed
obligations, or AAA rated pre-refunded municipals to satisfy this condition.
6. Obligations issued by the following agencies which are backed by the full faith and
credit of the U.S.:
a. U.S. Export-Import Bank (Eximbank)
Direct obligations or fully guaranteed certificates of beneficial ownership
. -
b. Farmers Home Administration (FmHA)
Certificates of beneficial ownership
c. Federal Financing Bank
d. General Services Administration
Participation certificates
e. U.S. Maritime Administration
Guaranteed Title XI financing
f. U.S. Department of Housing and Urban Development (HUD)
Project Notes
Local Authority Bonds
New Communities Debentures - U.S. government guaranteed debentures
U.S. Public Housing Notes and Bonds - U.S. government guaranteed public
housing notes and bonds
F. Agents:
1. In transactions where there is an agent/enhancer (other than the Insurer), the trustee,
tender agent (if any), and paying agent (if any) must be commercial banks with trust
powers.
2. The remarketing agent must have trust powers if they are responsible for holding
moneys or receiving bonds. As an alternative, the documents may provide that if the
remarketing agent is removed, resigns or is unable to perform its duties, the trustee
must assume the responsibilities of remarketing agent until a substitute acceptable to
the Insurer is appointed.
MBLA
STANDARD CONDITIONS FOR REFUNDINGS
A. Receipt by the Insurer of the final debt service schedule on the issue within three business
days from the sale date.
B. Receipt, satisfactory review and subsequent oral approval by the Insurer at least ten days
in advance of closing of draft copies of:
1. a verification by an independent CPA firm of the sufficiency of the escrow to
timely retire the refunded bonds;
2. the escrow securities purchase contracts of SLG subscription forms or open
market confirmations; and,
3. the escrow agreement
-
Final and signed copies of all the above documents to be sent via overnight mail from
closing.
An independent CPA firm is defined as a licensed CPA firm acting at arms length of the
transaction on behalf of the bondholders. It may not be the underwriter, bond counsel or
financial adviser for the refunding issue. The firm must carry errors and omissions
insurance. The Insurer reserves the right to review the provider of the verification on a deal
by deal basis.
C. Receipt by the Insurer at least five business days prior to closing of a draft opinion from
Bond Counsel (or Special Tax Counsel) to the effect that the refunding bonds are being
issued in compliance with state law and that the interest on the refunding bonds is tax-
exempt.
D. Receipt by the Insurer at least five business days prior to closing of a draft opinion from
Bond Counsel stating that the refunded bonds have been legally defeased. (This condition is
only applicable in those situations where the refunding issue is legally defeasing the
refunded issue.) Final executed copies of items C and D to be sent via overnight mail.
E. If the escrow agreement allows for the substitUtion of securities in the escrow account,
then it should be provided in the escrow agreement that no such substitution may occur
unless there has first been delivered to the escrow agent/trustee, (1) a CPA verification that
the escrow investments, as substituted, are sufficient to pay debt service, as it becomes due,
on the refunded bonds and (2) an opinion of nationally recognized bond counsel to the effect
that the substitution is permitted under the documents and the substitution has no adverse
effect on the tax-exempt nature of the refunding bonds. See 2 above for the definition of an
independent CPA.
F. Escrow investments must be limited to:
1. Cash
2. U.S. Treasury Certificates, Notes and Bonds (including State and Local
Government Series -- "SLGS").
3. Direct obligations of the Treasury which have been stripped by the Treasury
itself, CATS, TIGRS and similar securities.
..MBIA
4. Resolution Funding Corp. (REFCORP) Only the interest component of
REFCORP strips which have been stripped by request to the Federal Reserve Bank of New
York in book entry form are acceptable.
5. Pre-refunded municipal bonds rated "Aaa" by Moody's and "AAA" by S&P. If
however, the issue is only rated by S&P (i.e., there is no Moody's rating), then the pre-
refunded bonds must have been pre-refunded with cash, direct U.S. or U.S. guaranteed
obligations, or AAA rated pre-refunded municipals to satisfy this condition.
6. Obligations issued by the following agencies which are backed by the full faith
and credit of the U.S.:
a. U.S. Export-Import Bank (Eximbank)
- Direct obligations or fully guaranteed certificates of beneficial ownership
b. Farmers Home Administration (FmHA)
Certificates of beneficial ownership
c. Federal Financing Bank
d. General Services Administration
Participation certificates
e. U.S. Maritime Administration
Guaranteed Title XI financing
f. U.S. Department of Housing and Urban Development (RUD)
Project Notes
Local Authority Bonds
New Communities Debentures - U.S. government guaranteed debentures
U.S. Public Housing Notes and Bonds - U.S. government guaranteed public
housing notes and bonds
G. If a forward supply contract is being executed in conjunction with the refunding (or
subsequent to the closing of the refunding transaction), the following conditions must also
be met:
1 The Insurer must review and approve the forward supply contract at least five
business days prior to closing (or after closing, at least five business days prior to. execution
if not contemplated at the time of closing).
2 The forward supply contract must provide by its terms that the securities delivered
under the forward supply are sufficient (when taken- with other funds remaining in the
escrow) as to amount and timeliness to retire the refunded bonds.
3 The Insurer requires an opinion from a nationally recognized bankruptcy counsel
that the securities in escrow and payments to owners of refunded bonds will not constitute
assets of the fsc supplier and will not be subject to automatic stay in the event of bankruptcy
and/or insolvency of the supplier.
MBtA
4. The supplier of the securities delivered under the forward supply contract must
affirm in the contract that it has no rights to or interest in the monies or securities held in the
escrow.
5. The escrow agent must be acceptable to the Insurer. The Insurer reserves the
right to replace the escrow agent for cause.
6. See 6 above for investments permitted under the forward supply contract.
Investments must be non-callable.
7. The supplier should have no right to substitute the original escrow securities. The
supplier may substitute securities previously delivered by the supplier under the forward
supply contract only if:
a. _ The substituted securities mature on a date that is later than the previously
delivered securities would have matured; and
b. The substituted securities mature prior to the date needed to pay principal
and/or interest on the bonds.
8. Two days before each delivery date for the forward supply securities, the escrow
agent must notify the Insurer in writing of the securities to be delivered, the maturity amount
of the securities and the maturity date.
9. The forward supply contract cannot be amended or modified without the Insurer's
written consent.
5/6/93
EXHmIT E
RESERVE FUND GUARANTY AGREEMENT
Exhibit E
FINANCIAL GUARANTY AGREEMENT
FINANCIAL GUARAN1Y AGREEiYlENT made as of [CLOSING DATE], 1998, by and between
[ISSUER] (the lIIssuer") and NlBIA Insurance Corporation (the "Insurer"), organized under the laws of the
state of New York.
WITNESSETH:
WHEREAS, the Issuer has or will issue the Obligations; and
WHEREAS, pursuant to the terms of the Document the Issuer agrees to make certain payments on the
Obligations; and
WHEREAS, the Insurer will issue its Surety Bond, substantially in the form set forth in Annex A to this
Agreement, guaranteeing certain payments by the Issuer subject to the terms and limitations of the Surety
Bond; and
WHEREAS, to induce the Insurer to issue the Surety Bond, the Issuer has agreed to pay the premium
for the Surety Bond and to reimburse the Insurer for all payments made by the Insurer under the Surety
Bond, all as more fully set forth in this Agreement; and
WHEREAS, the Issuer understands that the Insurer expressly requires the delivery of this Agreement as
part of the consideration for the execution by the Insurer of the Surety Bond; and
NOW, TIIEREFORE, in consideration of the premises and of the agreements herein contained and of
the execution of the Surety Bond, the Issuer and the Insurer agree as follows:
ARTICLE I
DEFINITIONS; SURE'IY BOND
Section 1.01. Definitions. The terms which are capitalized herein shaJ] have the meanings specified in
Annex B hereto.
Section 1.02. Surety Bond.
(a) The Insurer will issue the Surety Bond in accordance with and subject to the terms and
conditions of the Commitment.
(b) The maximum liability of the Insurer under the Surety Bond and the coverage and term
thereof shall be subject to and limited by the terms and conditions of the Surety Bond.
Section 1.03. Premium: In consideration of the Insurer agreeing to issue the Surety Bond hereunder,
the Issuer hereby agrees to payor cause to be paid the Premium set forth in Annex B hereto. The Premium
on the Surety Bond is not refimdable for any reason.
Section 1.04. Certain Other Expenses. The Issuer will pay all reasonable fees and disbursements of the
Insurers special counsel related to any modification of this Agreement or the Surety Bond.
ARTICLE IT
REIlVIBURSEl\'1ENT AND INDEMNIFICATION
OBLIGATIONS OF ISSUER AND SECURITY THEREFOR
Section 2.01. Reimbursement for Payments Under the Surety Bond and Expenses: Indemni:fication.
(a) The Issuer will reimburse the Insurer, within the Reimbursement Period, without demand or
notice by the Insurer to the Issuer or any other person, to the extent of each Surety Bond Payment
with interest on each Surety Bond Payment from and including the date made to the date of the
reimbursement at the lesser of the Reimbursement Rate or the maximum rate of interest permitted by
then applicable law.
(b) The Issuer also agrees to reimburse the Insurer immediately and unconditionally upon
demand, to the extent permitted by state law, for all reasonable expenses incurred by the Insurer in
connection with the Surety Bond and the enforcement by the Insurer of the Issuers obligations under
this Agreement, the Document, and any other document executed in connection with the issuance of
the Obligations, together with interest on all such expenses from and including the date incurred to the
date of payment at the rate set forth in subsection (a) of this Section 2.0l.
( c) The Issuer agrees to indernni:fY the Insurer, to the extent permitted by state law, against any
and all liability, claims, loss, costs, damages, fees of attorneys and other expenses which the Insurer
may sustain or incur by reason of or in consequence of (i) the failure of the Issuer to perrorm or
comply with the covenants or conditions of this Agreement or (ii) reliance by the Insurer upon
representations made by the Issuer or (iii) a default by the Issuer under the terms of the Document or
any other documents executed in connection with the issuance of the Obligations.
(d) The Issuer agrees that all amounts owing to the Insurer pursuant to Section 1.03 hereof and
this Section 2.01 must be paid in full prior to any optional redemption or refunding of the Obligations.
( e) All payrrients made to the Insurer under this Agreement shall be paid in lawful currency of the
United States in immediately available funds at the Insurers office at 113 King Street, Armonk, New
York 10504, Attention: Accounting and Insured Portfolio Management Departments, or at such
other place as shall be designated by the Insurer.
Section 2.02. Allocation of Payments. The Insurer and the Issuer hereby agree that each payment
received by the Insurer from or on behalf of the Issuer as a reimbursement to the Insurer as required by
Section 2.01 hereof shall be applied by the Insurer first, toward payment of any unpaid prerni1.l1l1; second,
toward repayment of the aggregate Surety Bond Payments made by the Insurer and not yet repaid, payment
of which will reinstate all or a portion of the Surety Bond Coverage to the extent of such repayment (but not
to exceed the Surety Bond Limit); and third, upon full reinstatement of the Surety Bond Coverage to the
Surety Bond Limit, toward other amounts, including, without limitation, any interest payable with respect to
any Surety Bond Payments then due to the Insurer.
Section 2.03. Security for Payments: Instruments of Further Assurance.. To the extent, but only to the
extent, that the Document, or any related indenture, trust agreement, ordinance, resolution, mortgage,
security agreement or similar instrument, if any, pledges to the Owners or any trustee therefor, or grants a
security intere..~ or lien in or on any collateral, property, revenue or other payments ("Collateral and
Revenues") in order to secure the Obligations or provide a source of payment for the Obligations, the Issuer
hereby grants to the Insurer a security interest in or lien on, as the case may be, and pledges to the Insurer all
such Collateral and Revenues as security for payment of all amounts due hereunder and under the Document
or any other document executed in connection with the issuance of the Obligations, which security interest,
lien and/or pledge created or granted under this Section 2.03 shall be subordinate only to the interests of the
Owners and any trustee therefor in such Collateral and Revenues, except as otherwise provided. The Issuer
agrees that it will, from time to time, execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, any and all :financing statements, if applicable, and all other further instruments
as may be required by law or as shall reasonably be requested by the Insurer for the perfection of the security
interest, if any, granted under this Section 2.03 and for the preservation and protection of all rights of the
Insurer under this Section 2.03.
Section 2.04. Unconditional Obligation. The obligations hereunder are absolute and unconditional and
will be paid or performed strictly in accordance with this Agreement, subject to the limitations of the
Document, irrespective of
(a) any lack of validity or enforceability o~ or any amendment or othermodi:fication o~ or waiver
with respect to the Obligations, the Document or any other document executed in connection with the
issuance of the Obligations; or
(b) any exchange, release or nonperrection of any security interest in propeny securing the
Obligations or this Agreement or any obligations hereunder; or
( c) any circumstances that might otherwise constitute a defense available to, or discharge ot; the
Issuer with respect to the Obligations, the Docwnent or any other docwnent executed in connection
with the issuance of the Obligations; or
(d) whether or not such obligations are contingent or matured, disputed or undisputed, liquidated
or unliquidated.
Section 2.05. Insurers Rights. The Issuer shall repay the Insurer to the extent of payments made and
expenses incurred by the Insurer in connection with the Obligations and this Agreement. The obligation of
the Issuer to repay such amounts shall be subordinate only to the rights. of the Owners to receive regularly
scheduled principal and interest on the Obligations.
Section 2.06. On-Going Information Obligations ofIssuer.
(a) Quarterlv Reports. The Issuer will provide to the Insurer within 45 days of the close of each
quarter interim financial statements covering all :fimd balances under the Document, a statement of
operations (income statement), balance sheet and changes in fund balances. These statements need
not be audited -by an independent certified public accountant, but if any audited statements are
produced, they must be provided to the Insurer;
(b) Annual Reports. The Issuer will provide to the Insurer annual financial statemems audited by
an independent certified public accountant within 90 days of the end of each:fiscal year,
(c) Access to Facilities. Books and Records. The Issuer will grant the Insurer reasonable access
to the project financed by the Obligations and Vlill make available to the Insurer, at reasonable times
and upon reasonable notice all books and records relative to the project financed by the Obligations;
and
(d) Compliance Certificate. On an annual basis the Issuer will provide to the Insurer a certificate
confirming compliance with all covenants and obligations hereunder and under the Revenue
Agreement, the Document or any other docwnent executed in connection with the issuance of the
Obligations.
ARTICLE ill
AMENDl\1ENTS TO DOCUM:ENT
So long as this Agreement is in effect, the Issuer agrees that it will not agree to amend the Document or
any other document executed in connection with the issuance of the Obligations, without the prior written
consent of the Insurer.
ARTICLE IV
EVENTS OF DEFAULT; RElVIEDIES
Section 4.01. Events of Default. The following events shall constitute Events of Default hereunder:
(a) The Issuer shall fail to pay to the Insurer when due any amount payable under Sections 1.03;
or
(b) The Issuer shall fail to pay to the Insurer any amount payable under Sections 1.04 and 2.01
hereof and such failure shall have continued for a period in excess of the Reimbursement Period; or
(c) Any material representation or warranty made--hy the Issuer under the Document or
hereunder or any statement in the application for the Surety Bond or anYureport, certificate, financial
statement, document or other instrument provided in connection with the Commitment, the Surety
Bond, the Obligations, or herewith shall have been materially false at the time when made; or
(d) Except as otherwise provided in this Section 4.01, the Issuer shall fail to perform any of its
other obligations under the Document, or any other docwnent executed in connection with the
issuance of the Obligations, or hereunder, provided that such failure continues for more than 30 days
after receipt by the Issuer of written notice of such failure to perform; or
( e) The Issuer shall (i) voluntarily commence any proceeding or file any petition seeking relief
under the United States Bankruptcy Code or any other Federal, state or foreign bankruptcy,
insolvency or similar law, (Ii) consent to the institution o~ or fail to controvert in a timely and
appropriate manner, any such proceeding or the filing of any such petition, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator or similar official for such party or for a
substantial part of its property, (iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment for the benefit of creditors, (vi)
become unable, admit in writing its inability or fail generally to pay its debts as they become due or
(vii) take action for the purpose of effecting any of the foregoing; or.
(f) An involuntary proceeding shall be commenced or an involuntary petition shall be filed in a
court of competent jurisdiction seeking (i) relief in respect of the Issuer, or of a substantial part of its
property, under the United States Bankruptcy Code or any other Federal, state or foreign bankruptcy,
insolvency or similar law or (ii) the appointment of a receiver, trustee, custodian, sequestrator or
similar official for the Issuer or for a substantial part of its property; and such proceeding or petition
shall continue undismissed for 60 days or an order or decree approving or ordering any of the
foregoing shall continue unstayed and in effect for 30 days.
Section 4.02. Remedies. If an Event of Default shall occur and be continuing, then the Insurer may
take whatever action at law or in equity may appear necessary or desirable to collect the amounts then due
and thereafter to become due under this Agreement or to enforce performance of any obligation of the Issuer
to the Insurer under the Document or any related instrument, and any obligation, agreement or covenant of
the Issuer under this Agreement; provided, however, that the Insurer may not take any action to direct or
require acceleration or other early redemption of the Obligations or adversely affect the rights of the Owners.
In addition, if an Event of Default shall occur due to the failure to pay to the Insurer the amounts due under
Section 1.03 hereo~ the Insurer shall have the right to cancel the Surety Bond in accordance with its terms.
All rights and remedies of the Insurer under this Section 4.02 are cumulative and the exercise of anyone
remedy does not preclude the exercise of one or more of the other available remedies.
ARTICLE V
SE'ITLEMENT
The Insurer shall have the exclusive right to decide and determine whether any claim, liability, suit or
judgment made or brought against the Insurer, the Issuer or any other party on the Surety Bond shall or shall
not be paid, compromised, resisted, defended, tried or appealed, and the Insurer's decision thereon, if made in
good faith, shall be final and binding upon the Insurer, the Issuer and any other party on the Surety Bond.
An itemized statement of payments made by the Insurer, certified by an officer of the Insurer, or the voucher
or vouchers for such payments, shall be prima facie evidence of the liability of the Issuer, and if the Issuer fails
to immecfuJ.tely reimburse the Insurer upon the receipt of such statement of payments, interest shall be
computed on such amount from the date of. any payment made by the Insurer at the rate set forth in
subsa.1ion (a) of Section 2.01 hereof
ARTICLE VI
lVIISCEILANEOUS
Section 6.01. Interest Computations. All computations of interest due hereunder shall be made on the
basis of the actual number of days elapsed over a year on 60 days.
Section 6.02. Exercise of Rights. No failure or delay on tHe.part of the Insurer to exercise any right,
power or privilege under this Agreement and no course of dealing between the Insurer and the Issuer or any
other party shall operate as a waiver of any such right, power or privilege, nor shall any single or partial
exercise of any such right, power or privilege preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The rights and remedies herein expressly provided are cumulative and
not exclusive of any rights or remedies which the Insurer would otherwise have pursuant to law or equity.
No notice to or demand on any party in any case shall entitle such party to any other or further notice or
demand in similar or other circumstances, or constitute a waiver of the right of the other party to any other or
further action in any circumstances without notice or demand.
Section 6.03. Amendment and Waiver. Any provision of this Agreement may be amended, waived,
supplemented, discharged or terminated only with the prior written consent of the Issuer and the Insurer.
The Issuer hereby agrees that upon the written request of the Paying Agent, the Insurer may make or
consent to issue any substitute for the Surety Bond to cure any ambiguity or formal defect or omission in the
Surety Bond which does not materially change the terms of the Surety Bond nor adversely affect the rights
of the Owners, and this Agreement shall apply to such substituted surety bond. The Insurer agrees to deliver
to the Issuer and to the company or companies, if any, rating the Obligations, a copy of such substituted
surety bond.
Section 6.04. Successors and Assigns; Descriptive HeadinlZs.
(a) This Agreement shall bind, and the benefits thereof shall inure to, the Issuer and the Insurer
and their respective successors and assigns; provided, that the Issuer may not transfer or assign any or
all of its rights and obligations hereunder without the prior written consent of the Insurer.
(b) The descriptive headings of the various provisions of this Agreement are inserted for
convenience of reference only and shall not be deemed to affect the meaning or construction of any of
the provisions hereof
Section 6.05. Other Sureties. If the Insurer shall procure any other surety to reinsure the Surety Bond,
this Agreement shall inure to the benefit of such other surety, its successors and assigns, so as to give to it a
direct right of action against the Issuer to enforce this Agreement, and "the Insurer," wherever used herein,
shall be deemed to include such reinsuring surety, as its respective interests may appear.
Section 6.06. SilZllature on Bond. The Issuer's liability shall not be affected by its failure to sign the
Surety Bond nor by any claim that other indemnity or security was to have been obtained nor by the release
of any indemnity, nor the return or exchange of any collateral that may have been obtained.
Section 6.07. Warv"er. The Issuer waives any defense that this Agreement was executed subsequent to
the date of the Surety Bond, admitting and covenanting that such Surety Bond was executed pursuant to the
Issuer's request and in reliance on the Issuer's promise to execute this Agreement.
Section 6.08. Notices. Requests. Demands. Except as otherwise expressly provided herein, all written
notices, requests, demands or other communications to or upon the respective parties hereto shall be deemed
to have been given or made when actually received, or in the case of telex or telecopier notice sent over a
telex or a telecopier machine owned or operated by a party hereto, when sent, addressed as specified below
or at such other address as any of the parties may hereafter specifY in writing to the others:
If to the Issuer: [ISSUER]
[S1REET ADDRESS]
[CITY, STATE ZIP]
Attention: [pERSON AT ISSUER]
If to the Paying Agent: [P A YJNG AGENT]
Attention: Corporate Trust Officer
If to the Insurer: .MBIAInsurance Corporation
113 King Street
Armonk, New York 10504
Attention: Insured Portfolio
Management Group
Section 6.09. Survival of Representations and Warranties. - All representations, warranties and
obligations contained herein shall survive the execution and delivery of this Agreement and the Surety Bond.
Section 6.10. Governing Law. This Agreement and the rights and obligations of the parties under this
Agreement shall be governed by and construed and interpreted in accordance with the laws of the State.
Section 6.11. Counterparts. This Agreement may be executed in any number of copies and by the
different parties hereto on the same or separate counterparts, each of which shall be deemed to be an original
instrument. Complete counterparts of this Agreement shall be lodged with the Issuer and the Insurer.
Section 6.12. Severability. In the event any provision of this Agreement shall be held invalid or
unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render
unenforceable any other provision hereof
Section 6.13. Survival of Obligations. Notwithstanding anything to the contrary contained in this
Agreement, the obligation of the Issuer to pay all amounts due hereunder and the rights of the Insurer to
pursue all remedies shall survive the expiration, termination or substitution of the Surety Bond and this
Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be
duly executed and delivered as of the date first above written.
[ISSUER]
By:
Title:
MBIA Insurance Corporation
President
Attest:
Assistant Secretary
..
Al'\fN"E X A
DEBT SERVICE RESERVE
SURETY BOND
MBIA Insurance Corporation
Armonk, New York 10504
Surety Bond No. XXXXJC(
lvffiIA Insurance Corporatio"n (the "Insurer"), in consideration of the payment of the premium and subject to the
terms of this Surety Bond, hereby unconditionally and irrevocably guarantees the full and complete payments that
are to be applied to payment of principal of and interest on the Obligations (as hereinafter defined) and that are
required to be made by or on behalf of [Name of Issuer} (the "Issuer") under the [Title of the Document} (the
"Document") to [Name of Paying Agent}. (the "Paying Agent"), as such payments are due but shall not be so paid,
in connection with the issuance: by the Issuer of [Title of the Obligations} (the "Obligations"), (if parity " together
with any bonds issued on a parity therewith, "}, provided, that the amount available hereunder for payment
pursuant to anyone Demand for Payment (as hereinafter defined) shall not exceed (a: FIXED COVERAGE (Dollar
Amount of Coverage} or the debt service reserve 'fund requirement for the Obligations (as set forth in the
Document), whichever is less (the "Surety Bond Limit"); provided, further. that the amount available at any
particular time to be paid to. the Paying, Agent under the terms hereof (the "~urety Bond Coverage") shall be
reduced and may be reinstated from time to time as set forth herein.} or {b: VARIABLE COVERAGE the annual.
amount set forth for the applicable bond year on Exh.ibit A attached hereto (the "Surety Bond Limit"); provided,
further, that the amount available at any particular time to be paid to the Paying Agent under the ~erms hereof (the
"Surety Bond Coverage") shall be reduced and may be reinstated from time to time as set forth herein.}
.1. As used herein, the term "Owner" shall mean the registered owner of any Obligation as indicated in the books
maintained by the applicable paying agent, the Issuer or any designee of the Issuer for such purpose. The term
"Owner" shall not include the Issuer or any person or' entity whose obligation or obligations by agreement
constitute the underlying security or source of payment for the Obligations.
2. Upon the later of: (i) three (3) days after receipt by the Insurer of a demand for payment in the form attached.
hereto as Attachment 1 (the "Demand for Payment"), duly executed by the Paying Agent; or (Ii) the payment date
of the Obligations as specified in the Demand for Payment presented by the Paying Agent to the Insurer, the
Insurer ",ill make a deposit offunds in an account with State ~treet Bank .and Trust CompanY.tl N.A., in New York,
New York, or its successor, sufficient for the payment to the Paying Agent, of amounts th.it are then due to the
Paying Agent (as specified in the"Demand for Payment) subject to the Surety Bond Coverage:
. 3. Demand for Payment hereunder may be made by prepaid telecopy. telex, TWX or telegram of the executed
Demand for Payment do the Insurer. If a Demand for Payment made hereunder does not, -in any instance, conform
to the terms and cqnditions of this Surety Bond, the Insurer shall give notice to the Paying Agent,. as promptly as
reasonably pr;lcticable, that such Demand for Payment was not effected in accordance with the terms and
conditions of this suretY Bond and briefly state the reason(s) therefor. Upon being notified that such Demand for
Payment was not effected in accordaIice with this Surety Bond, the Paying Agent may attempt to correct any such
nonconforming Demand for Payment if, and to the extent that, th~ Paying Agent is entitled and able to do so.
4. The amount payable. by the In.surer under this Surety Bond pursuant to a particular Demand for Payment shall
be limited to the Surety Bond Coverage. The Surety Bond Coverage shall be reduced automatically to the extent of
each payment made by the Insurer hereunder and will be reinstated to the extent of each reimbursement of the
Insurer pursuant to the provisions of Article II of the Fmancial Guaranty Agreement dated the date herrofbetween "
the Insurer and the [Issuer or Obligor} (the wFmancialGuaranty Agreement"); provided, (ANNUAL PREMIUM
OPTION: that no premium is due and unpaid on this Surety Bond and] that in no event shall such reinstatement
xceed the Surety Bond Limit The Insurer will notify the Paying AgerlCfu writing within five (5) days of such
,c;:imbursement, that the Surety Bond Coverage has been reinstated to the C>."tent of such reimbursement pursuant to
the Financial Guaranty Agreement and such reinstatement shall be effective as of the date the Insurer gi....es such
. notice. The notice to the Paying Agent will be substantially in the form attached hereto as Attachment 2.
5. Any service of process on the Insurer or notice to the Insurer may be made to the Insurer at its offices located
at 113 King Street. Annonk. New York 10504 and such service of process shall be valid and binding.
6. The term of this Surety Bond shall expire [ANNUAL PREMIUM OPTION: ,unless cancelled pursuant to
paragraph 9 hereof,] on tlle earlier of (i) (MATURITY DATE} (the maturity date of the Obligations being
currently issued), or (ii) the dale on which the Issuer has made all payments required to be made on the Obligations
pursuant to the Document.
7. The premium payable on tius Surety Bond is not refundable for any reason, including the payment prior to
maturity of the Obligations.
[OPTIONAL FIRST SENTENCE: This Surety Bond shall be governed by and interpreted under the laws of
the State of (STATE)]. Any suit hereunder in connection with any payment may be brought only by the Paying
Agent within [lor 3 years] after (i) a Demand for Payment, with respect to such payment, is made pursuant to the
terms of this Surety Bond and the Insurer has failed to ma.lce such payment., or (ii) payment would otherwise have
been due hereunder but for the failure on the part of the Paying Agent to deliver to the Insurer a Demand for
Payment pursuant to the tenus of this Surety Bond, whichever is earlier.
[NOS. 9 and 11 are OPTIONALl
9. Subject to the terms of the Document, the Issuer shall have the right., upon 30 days prior written notice to the
Insurer and the Paying Agent, to terminate this Surety Bond. In the event of a failure by the Issuer to pay the
premium due on tius Surety Bond pursuant to the terms of the Financial Guaranty Agreement, the Insurer shall
have the right upon [No. of days] days pnor written notice to the Issuer and the Paying Agent to cancel this Surety
Bond. No'Demand for Payment shall be made subsequent to such notice of cancellation unless payments are due
but shaH not have been so paid in connection with the Obligations.
10. There shall be no acceleration payment due under this Policy unless such acceleration is at the sole option of
the Insurer.
11. This policy is not covered by tile Property/Casualty Insurance Security Fund specified in Article 76 of the
New York Insurance Law.
In witness whereof, the Insurer has caused tius Surety Bond to be executed in facsimile on its behalf by its duly
authorized officers, tius [DATEl day of[MONTIL YEAR]
In witness whereof, tile Insurer has caused this Surety Bond to be executed in facsimile on its behalf by its duly
p.uthorized officers, this day of October, 1995
l'v1BIA Insurance Corporation
"~
~"
President
~
".'
NJ.i:st
~ Secretary
SB-DSRF-9[STATE CODE]
4/95
Bond Year
199 to 199
199 to 199
199 to 199
EXHIJ3IT A
Surety Bond No. XXXXXX
Maximum Annual Debt Service
$
$
$
I
~'
~
.'
Attachment 1
Surety Bond No. xxxxxx.
DEMAND FOR PA YNfENT
.19_
lvffiIA Insurance Corporation
113 King Street
Armonk., New York 10504
Attention: President
Reference is made to the Surety Bond No. XXXXXX (the "Surety Bond") issued by the MBIA Insurance
Corporation (the "Insurer"). The terms which are capitalized herein and not otherwise defined have the meanings
specified in the Surety Bond unless the context otherwise requires.
The Paying Agent hereby certifies that:
a) In accordance "vith the provisions of the Document (attached hereto as Exhibit A). payment is due to the
Owners of the Obligations on (the "Due Date") in an amount equal to S . (L.'1e" Amount
Due").
b) The debt service reserve fund requirement for the Obligations is S
c) The amounts legally available to the Paying Agent on the Due Date will be S less than the Amount
Due (the "Deficiency").
d) The Paying Agent has not heretofore made demand under the Surety Bond for the Amount Due or any
portion thereof.
The Paying Agent hereby requests that payment of the Deficiency (subject to the Surety Bond Coverage) be
made by the Insurer under the Surety Bond and directs that payment under the. Surety Bbnd be made to the
following account by bank wire transfer of federal or other immediately available funds Xii accordance with the
terms of the Surety Bond:
[paying Agent's Account)
Any Person Who Knowingly And With Intent To Defraud Any Insurance Company Or Other
Person Files An Application For Insurance Or Statement Of Claim Containing Any Materially
False Information, Or Conceals For The Purpose Of Misleading, Infonnation Concerning Any
Fact Material Thereto, Commits A Fraudulent Insurance Act, Which Is A Crimel And ShalI Also
Be Subject To A Civil Penalty Not To Exceed Five Thousand Dollars And The Stated Value Of
The Claim For Each Such Violation. .
(pAYING AGENT}
By
-. .Its.
Anachment 2
Surety Bond No. xx.xxxx
NOTICE OF REINSTATEMENT
,19_
[paying Agent}
[Address}
Reference is made to the Surety Bond No. XXXXXX (the "Surety Bond") issued by the MBIA Insurance
Corporation (the "Insurer"). The tenns which are capitalized herein and not otherwise defined have the meanings
specified in the Surety Bond unless the context otherwise requires.
The Insurer hereby deHvers notice that it is in receipt of payment from the ObHgor pursuant to Article II of the
Financial Guaranty Agreement and as of the date hereof the Surety Bond Coverage is $ .
MElA Insurance Corporation
President
Attest:
Assistant Secreta.l5'
I'
~.
.'
ANNRX B
DEFINITIONS
For all purposes of this Agreement and the Surety Bond, except as otherwise expressly provided herein
or unless the context otherwise requires, all capitalized terms shall have the meaning as set out below, which
shall be equally applicable to both the singular and plural forms of such terms.
"Agreement" means this Financial Guaranty Agreement.
"Closing Date" means [CLOSING DATE], 1998.
"Commitment" means the commitment to issue Municipal Bond Guaranty Insurance ill the form
attached hereto as Annex C.
'Debt Service Payments" means those payments required to be made by or on behalf of the Issuer
which will be applied to payment of principal of and interest on the Obligations.
"Demand for Payment" means the certificate submitted to the Insurer for payment under the Surety
Bond substantially ill the form attached to the Surety Bond as Attachment 1.
"Document" means [DOCUMENT].
''Event of Default" shall mean those events of default set forth in Section 4.01 of the Agreement.
"Insurer" has the same meaning as set forth in the first paragraph of this Agreement.
"Issuer" means [ISSUE].
"Obligations" means [LEGAL TITLE OF ISSUE] [IF APPLICABLE: together with any bonds
issued on a parity therewith].
"Ovvners" means the registered owner of any Obligation as indicated in the books maintained by the
Paying Agent, the Issuer or any designee of the Issuer for such purpose.
''Paying Agent" means [pAYING AGENT].
"Premium" means [pREMTI.)M} payable to the Insurer on or prior to the Closing Date.
"Reimbursement Period" means, with respect to a particular Surety Bond Payment, the period
commencing on the date of such Surety Bond Payment and ending on the earlier of the date of cancellation
of the Surety Bond due to nonpayment of Premium when due or on the expiration of x following such
Surety Bond Payment.
"Reimbursement Rate" means CitJ.ba:n.lCs prime rate plus three (3) percent per annum, as of the date of
such Surety Bond Payment, said "prime rate" being the rate of interest announced from time to time by
CitIbank, N.A, New York, New York, as its prime rate. The rate of interest shall be calculated on the basis
of the actual number of days elapsed over a :560-day year.
"State" means [STATE].
"Surety Bond" means that surety bond attached hereto as Annex A and issued by the Insurer
guaranteeing, subject to the terms and limitations thereo( Debt Service Payments required to be made by the
Issuer under the Document.
"Surety Bond Coverage" means the amount available at any particular time to be paid under the terms
of the Surety Bond, which amount shall never exceed the Surety Bead Limit.
"Surety Bond Limit" means [SURETY BOND LIMIT].
"Surety Bond Payment" means al1 amount equal to the Debt Service Payment required to be made by
the Issuer pursuant to the Document less (i) that portion of the Debt Service Payment paid by or on behalf of
the Issuer, and (ii) other fimds legally available for payment to the Ovvners, all as certified in a Demand for
Payment.