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HomeMy WebLinkAboutItem VI (A2) - Capital Improvement Revenue Bond, Series 1991 - Resolution No 91-08 AGENDA 4-16-91 "CENTER OF GOOD LIVING-PRIDE OF WEST ORANGE" Item VI A 2 ` Ocoee Lcoinix iJHDDD,JK. • ° CITY OF OCOEE CIT Y o= oN • 150 N.LAKESHORE DRIVE O OCOEE FLORIDA 34761 PAUL W.FOSTER 16* (407)656-2322 VERN COMBS �f �, SAM WOODSON ti f+ or 0000 `�a` CITY MANAGER ELLIS SHAPIRO MEMORANDUM To: The Honorable Mayor and Board of City Commissioners From: Jean Grafton, City Clerk Date: April 12, 1991 RE: Contract of Purchase/$2, 580, 000 Capital Improvement Bonds Please note that the Contract of Purchase attached to Resolution 91-08 is a draft; and, as there will be additional comments, a blacklined copy will be distributed at the meeting. We wanted to be sure that you had the bulk of the material available to read this weekend with your packet. AGENDA 4-16-91 Item VI A 2 RESOLUTION NO. 91- 08 A RESOLUTION AUTHORIZING THE NEGOTIATED SALE OF $2 , 580, 000 CITY OF OCOEE, FLORIDA, CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 1991; AWARDING THE SALE THEREOF TO WILLIAM R. HOUGH & CO. , SUBJECT TO THE TERMS AND CONDITIONS OF A PURCHASE CONTRACT; AUTHORIZING THE DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT AND A FINAL OFFICIAL STATEMENT IN CONNECTION WITH THE DELIVERY OF THE BONDS; AUTHORIZING THE ISSUANCE OF SUCH BONDS; PROVIDING CERTAIN OTHER MATTERS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Ocoee, Florida (the "Issuer") , has by Resolution NO. 91- 07 , adopted on April 16, 1991, (the "Resolution") , authorized the issuance of not to exceed $2 , 600, 000 City of Ocoee, Florida, Capital Improvement Revenue Bonds, Series 1991, to finance the acquisition, construction, expansion, renovation, installation and equipping of the City of Ocoee' s city hall and police station (the "Project") ; and WHEREAS, due to the present instability in the market for revenue obligations the interest on which is excluded from federal gross income, the critical importance of the timing of the sale of the Bonds, and due to the willingness of William R. Hough & Co. (the "Underwriter") to purchase $2 , 580, 000 principal amount of City of Ocoee, Florida, Capital Improvement Revenue Bonds, Series 1991 (the "Bonds") , at interest rates favorable to the Issuer, it is hereby determined that it is in the best interest of the public and the Issuer to sell the Bonds at a negotiated sale; and WHEREAS, the Issuer has received an offer from the Underwriter to purchase the Bonds, subject to the terms and conditions set forth in the Contract of Purchase, a copy of which is attached hereto as Exhibit A (the "Purchase Contract") ; and WHEREAS, the Issuer now desires to sell its Bonds pursuant to the Purchase Contract and to authorize distribution of an Official Statement in connection with the issuance of the Bonds; and WHEREAS, the Issuer has been provided all applicable disclosure information required by Section 218 . 385, Florida Statutes, a copy of which is attached as an exhibit to the Purchase Contract; and WHEREAS, all capitalized undefined terms used herein shall have the meaning set forth in Resolution 91- 07 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE, FLORIDA: SECTION 1. The Bonds are hereby sold to William R. Hough & Co. , upon the terms and conditions set forth in the Purchase Contract attached hereto as Exhibit A and incorporated by reference. The Mayor and the City Clerk of the Issuer are hereby authorized to execute such Purchase Contract in substantially the form attached as Exhibit A, with such additional changes, insertions and omissions therein as do not change the substance thereof and as may be approved by the said officers of the Issuer executing the same and the City Attorney, such execution to be conclusive evidence of all such approvals. 2 SECTION 2 . The Bonds shall be dated April 1, 1991, shall bear interest at the rates, shall be in such denomination, shall mature in the years and amounts, and shall be subject to redemption, as set forth in the Exhibits to the Purchase Contract. SECTION 3 . The Bonds shall be issued under and secured by the Resolution and shall be executed and delivered by the Mayor and attested by the City Clerk of the Issuer in substantially the form set forth in the Resolution, with such additional changes and insertions therein as conform to the provisions of the Purchase Contract, and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 4 . The distribution by the Underwriter of a Preliminary Official Statement of the Issuer relating to the Bonds is hereby approved, confirmed and ratified, and a final Official Statement of the Issuer relating to the Bonds is hereby approved in substantially the form of the Preliminary Official Statement attached as an Exhibit to the Purchase Contract. The Official Statement will be executed by appropriate officers of the Issuer, such execution to be conclusive evidence of approval of the Official Statement in its final form. SECTION 5. The Reserve Fund Requirement for the Bond shall be $ SECTION 6 . All prior resolutions or other actions of the Issuer inconsistent with the provisions of this Resolution are hereby modified, supplemented and amended to conform with the provisions herein contained and except as otherwise modified, 3 supplemented and amended hereby shall remain in full force and effect. SECTION 7 . The Mayor and the City Clerk, the City Attorney of the Issuer or any other appropriate officers of the Issuer are hereby authorized and directed to execute any and all certifications or other instruments or documents required by the Resolution, the Purchase Contract, this Resolution or any other document referred to above as a prerequisite or precondition to the issuance of the Bonds and any such representation made therein shall be deemed to be made on behalf of the Issuer. All action taken to date by the officers of the Issuer in furtherance of the issuance of the Bonds is hereby approved, confirmed and ratified. SECTION 8 . In accordance with the Code, the Issuer represents and covenants that it is a governmental unit with taxing powers; that the Bonds are not private activity bonds as defined in Section 141 (a) of the Code; that 95% or more of the net proceeds of the Bonds (i.e. , the face amount of the Bonds) , are to be used for the local governmental activities of the Issuer and that the aggregate face amount of all obligations of the Issuer (including all subordinate entities of the Issuer and entities, if any, which issue bonds on behalf of the Issuer) , the interest on which is not includable in federal gross income (other than private activity bonds as defined in Section 142 (a) of the Code) , issued during the calendar year 1991 will not exceed $5, 000, 000. SECTION 9 . This Resolution has been adopted pursuant to an advertised public hearing held on March 5, 1991 in accordance with 4 and pursuant to the provisions of the Charter of the City of Ocoee. SECTION 10. This Resolution shall be in full force and effect immediately upon its adoption and approval in the manner provided by law. PASSED AND ADOPTED IN PUBLIC SESSION of the City Commission of the City of Ocoee, Florida, this day of April A.D. , 1991. APPROVED this day of , A.D. , 1991, at o'clock p.m. Lester Dabbs, Jr. , Mayor FILED in the Office of the City Clerk this day of April, 1991. Jean Grafton, City Clerk FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY BY THE CITY OF OCOEE, FLORIDA, COMMISSION AT A MEETING APPROVED AS TO FORM AND LEGALITY HELD ON THIS DAY OF , 1991 UNDER AGENDA ITEM NO. 1991. FOLEY & LARDNER By: City Attorney 5 EXHIBIT A PURCHASE CONTRACT [To come from Hough) C:\WP51\DOCS\MISC\AWRDRES214/9/91 ITPABI9IDAG:Ib William R. Hough & Co. 100 SECOND AVENUE SOUTH SUITE 800 ST,PETERSBURG, FLORIDA 33701 (813) 823-8100 MEMORANDUM TO: Ellis Shapiro FROM: Susan McGarry ,41-------. RE: $2,580,000 City of Ocoee Capital Improvement Revenue Bonds DATE: April 10, 1991 Enclosed is a copy of the Contract of Purchase relative to the above- referenced bond issue. We will go over the pricing on Monday and fill in the blanks and exhibits of this contract to present to the Commission on Tuesday at the meeting. The Preliminary Official Statement will also be attached as an exhibit to this Contract. STATE,COUNTY AND MUNICIPAL BONDS M 1 IF April 16, 1991 $2,580,000 CITY OF OCOEE, FLORIDA CAPITAL IMPROVEMENT REVENUE BONDS SERIES 1991 CONTRACT OF PURCHASE Honorable Mayor and Commissioners City of Ocoee 150 Lakeshore Drive Ocoee, Florida 34761 Gentlemen: William R. Hough & Co. (the "Underwriter") hereby offers to enter into this Contract of Purchase ("Contract of Purchase") with the City of Ocoee, Florida (the "City") for its $2,580,000 City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1991, to be dated as of April 1, 1991 (the "Bonds") . This offer is made subject to acceptance by the City prior to 11:59 p.m. , New York City time on the date hereof, and upon such acceptance this Contract of Purchase shall be in full force and effect in accordance with its terms and shall be binding upon the City and the Underwriter. 1 . Upon the terms and conditions and upon the basis of the representations herein set forth, the Underwriter hereby agrees to purchase from the City and the City hereby agrees to sell to the Underwriter all (but not less than all ) of the Bonds at an aggregate purchase price of $ (such amount representing the aggregate principal amount of the Bonds of $2,580,000 less an underwriter's discount of % of the principal amount of the Bonds) plus accrued interest from April 1, 1991 to the Date of Closing referred to in Section 6 hereof. The Bonds shall be as described in, and shall be issued under the authority of and in full compliance with, the Constitution and Statutes of the State of Florida, including particularly Chapter 166, Part II, Florida Statutes, Resolution No. of the City adopted on April 16, 1991, as amended and supplemented (the "Resolution") , authorizing issuance of the Bonds with only such changes therein as shall be agreed upon between us. The Bonds shall mature at the time and in the amount and bear interest at the rates set forth in Schedule I hereto and shall be redeemable as set forth in Schedule II hereto. All capitalized words and phrases used herein, unless otherwise noted, shall have the meaning given to them in the Resolution. The Underwriter agrees to make a public or private offering of the Bonds at the initial offering prices set forth in the Official Statement (as described below) relating to the Bonds; provided, however, that the Underwriter reserves the right to make concessions to dealers and to change such initial offering prices as the Underwriter shall deem necessary in connection with the marketing of the Bonds. 2. The Underwriter herewith delivers a check payable to the order of the City in the amount of one percent (1%) of the principal amount of the Bonds to be held uncashed as security for the performance by the Underwriter of its obligations to accept and pay for the Bonds at the Closing in accordance with the provisions of this Contract of Purchase. If the City does not accept this offer, or upon the City's failure to deliver the Bonds at Closing, or if the City shall be unable to satisfy the conditions to the obligations of the Underwriter contained in this Contract of Purchase (unless waived by the Underwriter), or if such obligations shall be terminated for any reason permitted by this Contract of Purchase, or otherwise at the Closing, you shall immediately return said check. If the Underwriter fails (other than for a reason permitted under this Contract of Purchase) to accept and pay for the Bonds at the Closing, the check may be cashed and the proceeds thereof shall be retained by the City as and for full liquidated damages for such failure and for any and all defaults hereunder on the part of the Underwriter, and thereupon all your claims and rights under this Contract of Purchase against the Underwriter shall be fully released and discharged. You and the Underwriter understand that in such event your actual damages may be greater or may be less than such sum. Accordingly, the Underwriter hereby waives any right you may have to additional damages from the Underwriter. Upon delivery of the Bonds by the City at Closing and payment by the Underwriter for such Bonds, as set forth herein, said check shall be returned to the Underwriters uncashed at Closing. 3. The Underwriter's purchase and acceptance of delivery of the entire $2,580,000 aggregate principal amount of the Bonds shall be a condition to the City's obligation to sell and deliver any Bonds to the Underwriter. 4. With your acceptance hereof, you will deliver to the Underwriter within seven business days after acceptance hereof, two copies of (a) the Official Statement (which term as used herein shall include the cover page, the summary statement and appendices contained therein) , dated the date hereof substantially in the form of Schedule III hereto (the "Official Statement"), executed on your behalf as indicated therein, and (b) the Resolution, certified by the Clerk of the City. In addition, as promptly as practicable after the date hereof, the City shall deliver to the Underwriter 250 copies of the Official Statement and shall furnish as many additional copies as may be mutually agreeable and are reasonably necessary to enable the Underwriter to comply with the requirements of Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule") and to fulfill its duties and responsibilities under the federal securities laws generally. The Official Statement shall be delivered to the Underwriter in final , printed form within seven business days after the date hereof. The Underwriter agrees to file the Official Statement with a Nationally Recognized Municipal Securities Information Repository ("NRMSIR") which has been so designated by the Securities and Exchange Commission pursuant to Rule 15c2-12 not later than two business days after the Closing, and will furnish the name and 2 address of the NRMSIR to the City upon request. The filing of the Official Statement with the NRMSIR shall be in accordance with the terms and conditions applicable to such NRMSIR. The City hereby agrees and covenants to furnish ongoing reports and information to the Underwriter as are or may become customary in the industry for municipal obligations similar to the Bonds, and specifically to furnish to the underwriter annually a copy of the City's audited financial statements when such becomes available. The City further hereby agrees and covenants to furnish to the Underwriter such other information as becomes available from time to time as would have been included in the Official Statement had the information been known at the time of the preparation thereof which information shall include data concerning any material adverse change in its business, properties or financial condition occurring either (i) before the Date of Closing or (ii) for the period thereafter during which the Underwriter is obligated to deliver a copy of the Official Statement in accordance with the Rule. The City authorizes the use and distribution of the Official Statement in connection with the public offering and sale of the Bonds. The City hereby ratifies and approves the use of the Preliminary Official Statement (the "Preliminary Official Statement") by the Underwriter and confirms that the Preliminary Official Statement was deemed final within the meaning of the Rule except for certain permitted omissions. The Underwriter agrees that it will not confirm the sale of Bonds unless a final written confirmation of sale is accompanied or preceded by the delivery of a copy of the Official Statement. 5. The City hereby represents and agrees as follows: (a) The City is and will be at the Date of Closing duly organized and validly existing as a municipal corporation under the laws of the State of Florida with the powers and authority set forth in the Florida Statutes, including particularly Chapter 166 and the Charter of the City, and any other applicable laws (collectively, the "Act") ; (b) The City has full legal right, power and authority to: (i) enter into this Contract of Purchase, (ii) adopt the Resolution, (iii) sell , issue and deliver the bonds to the Underwriter as provided herein, and (iv) carry out and consummate the transactions contemplated by this Contract of Purchase, the Resolution and the Official Statement. The City has complied, and at the Closing will be in compliance with the terms of the Act and with the obligations it has undertaken in connection with the issuance of the Bonds contained in the Resolution, the Bonds, and this Contract of Purchase; (c) By all necessary official action, the City has duly adopted the Resolution, has duly authorized and approved the Preliminary Official Statement and the Official Statement, has duly authorized and approved the execution and delivery of this Contract of Purchase and the performance by the City of its obligations in connection with the issuance of the Bonds contained in the Resolution and this Contract of Purchase, and the consummation by it of all other transactions contemplated by this Contract of Purchase in connection with the issuance of the Bonds; the Resolution constitutes a legal , valid and binding special obligation of the City, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' 3 rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) ; and the Bonds, when issued, authenticated and delivered to the Underwriter in accordance with the Resolution and this Contract of Purchase, will constitute legal , valid and binding special obligations of the City, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) ; (d) The City is not in material breach of or material default under any applicable constitutional provision, law or administrative regulation of the State of Florida (the "State") or the United States or any applicable judgment or decree, or any loan agreement, indenture, bond, note, or material resolution, agreement or other material instrument to which the City is a party or to which the City or any of its property or assets is otherwise subject and no event has occurred and is continuing which with the passage of time or the giving of notice or both, would constitute a default or event of default under any such constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, or material resolution, agreement or other material instrument; and the execution and delivery of the Bonds, this Contract of Purchase, the adoption of the Resolution and compliance with the provisions on the City's part contained therein, will not conflict with or constitute a breach of or default under any constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture bond, note, resolution, or other instrument to which the City is a party or to which the City or any of its property or assets is otherwise subject, nor will any such execution, delivery, adoption, or compliance result in the creation or imposition of any lien, charge, or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City or under the terms of any such law, regulation or instrument, except as provided by the Bonds and the Ordinance; (e) All required authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission (which has jurisdiction over such matter) have been duly obtained which are necessary for the due authorization or which would constitute a condition precedent to, or the absence of which would materially adversely affect the due performance by the City of its obligations in connection with the issuance of the Bonds, its obligations under this Contract of Purchase, and its obligations under the Resolution, except for such approvals, consents and orders as may be required under the Blue Sky or securities laws of any state in connection with offering and sale of the Bonds; (f) The descriptions of the Bonds and the Resolution in the Official Statement conform in all material respects to the Bonds and the Resolution; (g) The Bonds, when issued, executed and delivered in accordance with the Resolution and sold to the Underwriter as provided herein, will be validly issued and outstanding special obligations of the City, entitled to the benefits of the Resolution, and upon such issuance, execution and delivery the Resolution will provide for the benefit of the holders from time to time of the 4 Bonds, a legally valid and binding pledge of and lien on the Pledged Funds; (h) As of the date hereof, there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body pending or, to the best knowledge of the officials of the City executing this Contract of Purchase, threatened, against the City, affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the collection of the Revenues or the pledge of and lien thereon pursuant to the Resolution, or contesting or affecting as to the City the validity or enforceability of the Act in any respect relating to authorization for the issuance of the Bonds or contesting the exclusion of interest on the Bonds for Federal income tax purposes, or contesting the completeness or accuracy of the Official Statement or any supplement or amendment thereto, or contesting the authority of the City for the issuance of the Bonds, adoption of the Resolution, or the execution and delivery by the City of this Contract of Purchase; (i) The City will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order to (i) qualify the Bonds for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate, and (ii ) determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions, and will use its best efforts to continue such qualifications in effect so long as required for the distribution of the Bonds; provided, however, that the city shall not be required to execute a general or special consent to service of process or qualify to do business in connection with any such qualification or determination in any jurisdiction; (j) As of the date hereof, the information contained in the Preliminary Official Statement and the Official Statement under the headings "Purpose of the Bonds", Description of Certain Sources of Non-ad Valorem Revenues", and " The Project" did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (k) If the Official Statement is supplemented or amended pursuant to Subsection (1 ) of this Section 5) , at the time of each supplement or amendment thereto and (unless subsequently again supplemented or amended pursuant to such subsection) at all times subsequent thereto up to and including the Date of Closing referred to in Section 6 hereof, the Official Statement as so supplemented or amended will not contain any untrue statement of a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (1) If between the date of this Contract of Purchase and the Date of Closing referred to in Section 6 hereof, any event shall occur which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under 5 which they were made, not misleading, the City shall notify the Underwriter thereof and if, in the reasonable opinion of the City, such event requires the preparation and publication of a supplement or amendment to the Official Statement, the City will at its expense supplement or amend the Official Statement, in a form and in a manner approved by the City and the Underwriter, and will supply such amended and/or supplemented copies of the Official Statement to the Underwriter for distribution. 6. At 10:00 a.m. , New York City Time on April 30, 1991, or at such other time or on such earlier or later date upon which we agree, the City will deliver or cause to be delivered to us, at a place upon which we agree, the Bonds in definitive form (all the Bonds to be either lithographed on steel engraved borders or, at the election of the Underwriter, to be typewritten on safety paper, and in either case to bear proper CUSIP numbers) duly executed and authenticated in accordance with the Resolution and shall further deliver at such place the other documents hereinafter mentioned; and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in Section 1 hereof, in Federal funds to the order of the City. This delivery and payment is herein called the "Closing" and the date of such delivery and payment is herein called the "Date of Closing" . The Bonds will be made available at least one business day before the Date of Closing at a location to be agreed upon by us. The Bonds to be delivered at Closing shall be prepared and delivered only in fully registrable form. 7. The Underwriter has entered into this Contract of Purchase in reliance upon the representations of the City contained herein, and in reliance upon the representations to be contained in the documents and instruments to be delivered at the Closing and upon the performance by the City of its respective obligations hereunder and thereunder, both as of the date hereof and as of the Date of Closing. Accordingly, the Underwriter's obligations under this Contract of Purchase to purchase, to accept delivery of and to pay for the Bonds are conditioned upon the performance by the City of its obligations to be performed hereunder and under such documents and instruments at or prior to the Closing, and are also subject to the following additional conditions: (a) The representations of the City contained herein shall be true, complete and correct on the date hereof and on and as of the Date of Closing, as if made on the Date of Closing; (b) At the time of the Closing, the Resolution shall be in full force and effect in accordance with their terms and shall not have been amended, modified or supplemented except as mutually agreed since the date of this Contract of Purchase and the Official Statement shall not have been supplemented or amended, except in each such case as may have been agreed to by the Underwriter; (c) At the time of the Closing, all required official action of the City relating to this Contract of Purchase, the Bonds, and the City's approval of the Official Statement shall have been taken and shall be in full force and effect and such documents shall not have been amended, modified or supplemented in any material respect, except in each case as may have been agreed to by the Underwriter; 6 (d) At or prior to the Closing, the Underwriter shall have received copies of each of the following documents: (1) The Official Statement and each supplement or amendment, if any, thereto executed on behalf of the City by the Mayor; (2) The Resolution, certified by the Clerk under the seal as having been duly adopted or enacted by the City Commission and as being in effect, with such supplements or amendments as may have been agreed to by the Underwriter; (3) An opinion, dated the Date of Closing and addressed to the City, of Foley & Lardner, Bond Counsel to the City, in the form as attached to the Official Statement together with a letter of such counsel , dated the Date of Closing and addressed to the Underwriter to the effect that the foregoing opinion, addressed to the City may be relied upon by the Underwriter to the same extent as if such opinion were addressed to the Underwriter; (4) An opinion, dated the Date of Closing and addressed to the Underwriter, of Foley & Lardner, Bond Counsel to the City, to the effect that (i) this Contract of Purchase has been duly authorized, executed and delivered by the City and, assuming due authorization and execution by the Underwriter, constitutes a legal , valid and binding agreement of the City enforceable against the City in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditor's rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and no other authorization is required; and (ii) stating that the statements contained in the Official Statement under the captions "Description of the Bonds," "Security for the Bonds, " "Tax Exemption" are correct in all material respects and do not omit any statement which, in their opinion, should be included or referred to therein in order to make the statements contained therein not misleading; (5) An opinion, dated the Date of Closing and addressed to the Underwriter of Foley & Lardner, Attorneys for the City, to the effect that (i) this Contract of Purchase has been duly authorized, executed and delivered by the City and constitutes a binding agreement of the City enforceable in accordance with its terms except to the extent that the enforceability of the rights and remedies set forth herein may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally; (ii) the City has duly authorized, executed and delivered the Official Statement; (iii ) the information under the captions "Litigation" and "Disclosure Required by Florida Blue Sky Regulations" is correct in all material respects and does not omit any statement which in their opinion should be included or referred to therein in order to make the statements contained therein not misleading and, in addition, such counsel shall state that, based upon their participation in the 7 preparation of the Official Statement as the Attorneys for the City and without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement (except to the extent expressly set forth in this subparagraph (iii) , as of the Date of Closing nothing has come to their attention causing them to believe that (A) the Official Statement as of its date contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (except for the financial and statistical information contained in the Official Statement, and except for the information under the caption "Tax Exemption", as to all of which no view need be expressed) or (B) the Official Statement (as supplemented or amended pursuant to subsection (m) of Section 5 hereof, if applicable) as of the Date of Closing contains any untrue statement of a material fact or omits to state a material fact required to be stated therein, in the light of the circumstances under which they were made, not misleading (except as aforesaid) ; (iv) the City is not in material breach of or material default under any applicable constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the City is a party or to which the City or any of its property or assets is subject, nor will the execution, delivery, adoption, enactment, or compliance with any of the documents relating to the Bonds result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City or under the terms of any such law, regulation or instrument, except as expressly provided by the Bonds and the Resolution; (v) at all relevant times the City had the right and power to adopt the Resolution; the Resolution has been duly and lawfully adopted by the City; the Resolution is in full force and effect, and the Resolution constitutes the legal , valid and binding special obligation of the City, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) , and no other authorization is required; (vi ) the Bonds are valid and binding special obligations of the City, enforceable in accordance with their terms and the terms of the Resolution, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and are entitled to the benefits of the Resolution; and (vii) all authorizations, consents, approvals and reviews of governmental bodies or regulatory authorities then required for the City's adoption, enactment, execution and performance of and under the Bonds, the Resolution, and this Contract of Purchase have been obtained or effected and, to the best of their knowledge, they have no reason to believe that the 8 City will be unable to obtain or effect any such additional authorization, consent, approval or review that may be required in the future for performance of any of them by the City; and , in addition, they shall give their opinion to the effect set forth under the caption "Litigation" in the Official Statement. (6) A certificate, dated the Date of Closing, signed by the Mayor and the City Clerk, or other appropriate officials satisfactory to the Underwriter to the effect that, to the best of their knowledge; (i) the representations of the City herein are true and correct in all material respects as of the Date of Closing; (ii) the City has performed all obligations to be performed hereunder as of the Date of Closing; (iii) no litigation is pending or, to the best of their knowledge threatened (A) to restrain or enjoin the issuance or delivery of any of the Bonds, (B) in any way contesting or affecting any authority for the issuance of the Bonds or the validity of the Bonds, the Resolution, or this Contract of Purchase, (C) in any way contesting the corporate existence or powers of the City, (D) to restrain or enjoin the collection of the Revenues, (E) which may result in any material adverse change in the business, properties, assets or the financial condition of the City, or (F) asserting that the Official Statement contains any untrue statement of a material fact or omits any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading but, in lieu of such certificate, the Underwriter may in its sole discretion accept an opinion of counsel , acceptable to the Underwriter in form and substance, that in the opinion of counsel , the issues raised in any such pending or threatened litigation are without substance or that the contentions of any plaintiffs therein are without merit) ; (iv) since September 30, 1990 no material adverse change has occurred in the financial position and results of operations of the City except as set forth in or contemplated by the Official Statement; (v) the City has not, since September 30, 1990 incurred any material liabilities other than in the ordinary course of business or as set forth in or contemplated by the Official Statement; and (vi) the Official Statement did not as of its date, and does not as of the Date of Closing, contain any untrue statement of a material fact or omit to state a material fact which should be included therein for the purposes for which the Official Statement is to be used, or which is necessary in order to make the statements contained therein, in light of the circumstances in which they were made, not misleading. (7) A certificate, dated the Date of Closing, signed by the Mayor, City Manager, and the City Clerk, to the effect that, to the best of their knowledge the information set forth under the captions "Introduction," "Security for the Bonds, " "The Project, " "Litigation," Appendix A in the Official Statement (including any statistical information) , does not contain any untrue statement of a material factor omit any material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading. 9 (8) A Certificate, dated the Date of Closing, signed by the Finance Director and the City Manager to the effect that no material adverse change has occurred in the financial position and results of operations of the City since September 30, 1990 and that the data concerning the Pledged Funds contained in the Official Statement and the information contained in the section entitled "Security for the Bonds" is accurate in all material respects; (9) A letter, dated March 25, 1991 addressed to the Underwriter from McDermit, Davis, Lauteria & Company, P.A. consenting to the use of their opinion on the City's audited financial statements in the Official Statement to the references therein; (10) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Date of Closing, of the City's representations contained herein and of the statements and information contained in the Official Statement and the due performance or satisfaction by the City on or prior to the Date of Closing of all the agreements then to be performed and conditions then to be satisfied by it. All the opinions, letters, certificates, instruments and other documents mentioned above or elsewhere in this Contract of Purchase shall be deemed to be in compliance with the provisions hereof if, but only if, they are in form and substance satisfactory to the Underwriter. The opinion of Foley & Lardner which is referred to in Clause (3) of Subsection (d) of this Section shall be deemed satisfactory provided it is substantially in the form included in the Official Statement as Appendix D. If the City should be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds contained in this Contract of Purchase, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any reason permitted by this Contract of Purchase, this Contract of Purchase, shall terminate and neither the Underwriter nor the City shall be under any further obligation hereunder, except that: (i) the proceeds of the Good Faith Check referred to in Section 2 hereof shall immediately be returned to the Underwriter by the City; and (ii) the respective obligations of the City and the Underwriter set forth in Section 10 hereof shall continue in full force and effect. 8. The Underwriter shall have the right to terminate its obligations under this Contract of Purchase to purchase, to accept delivery of, and to pay for, the Bonds by notifying the City of its election to do so if, after the execution hereof prior to the Closing, if the marketability of the Bonds or the market price thereof in the reasonable opinion of the Underwriter, has been materially adversely affected by (i) an amendment to the Constitution of the United States or by any legislation (A) enacted by the United States, (B) recommended to the Congress for passage by the President of the United States, or (C) favorably reported for passage to either House of Congress by any 10 committee of such House to which such legislation has been referred for consideration, or introduced by any member or committee of the Congress, or by any decision of any court of the United States or by any ruling or regulation (final , temporary or proposed) on behalf of the Treasury Department of the United States, the Internal Revenue Service or any other authority of the United States affecting the federal tax status of the City, its property or income or the interest of its Bonds (including the Bonds) ; (ii) an outbreak of war or a national emergency or an escalation occurs with respect to hostilities in which the United States is currently engaged; (iii) there shall have occurred a declaration of a general banking moratorium by any authority of the United States or the states of New York or Florida; or (iv) an event described in Subsection (m) of Section 5 hereof shall have occurred which in the opinion of the Underwriter requires the preparation and publication of a supplement or amendment to the Official Statement. 9. The Underwriter shall be under no obligation to pay, and the City shall pay, any expense incident to the performance of the City's obligations hereunder including, but not limited to: (i) the cost of preparation, printing and delivery of the Preliminary Official Statement and the Official Statement, and any supplement and amendments thereto; (ii) the cost of preparation and printing or typewriting of the Bonds; (iii) the fees and disbursements of Foley & Lardner, Bond Counsel and Attorneys for the City; (iv) any fees due rate consultants, engineers and financial advisors; and (v) the fees and disbursements of McDermit, Davis, Lauteria & Company, P.A. for their services as independent certified public accountants for the City. The Underwriter shall pay the following issuance expenses: (i) the cost of preparation of this Contract of Purchase; and (ii ) all other expenses incurred by it in connection with the public offering of the Bonds. The Underwriter has provided to the City the disclosure letter pursuant to Section 218.385 (4), Florida Statutes, which is attached hereto as Schedule V. 10. Any notice or other communications to be given to the City under this Contract of Purchase may be given by delivering the same in writing signed by an officer of William R. Hough & Co. at your address set forth above and any such notice or other communications to be given to the Underwriter may be given by delivering the same in writing to William R. Hough & Co. , 100 Second Avenue south, Suite 800, St. Petersburg, Florida, 33701 . 11. This Contract of Purchase is made solely for the benefit of the City and the Underwriter and no other person, partnership, association or corporation shall acquire or have any right hereunder or by virtue hereof. All representations and agreements of the City in this Contract of Purchase shall remain operative and in full force and effect regardless of any investigation made by on or behalf of the Underwriter and shall survive the delivery of and payment for the Bonds. 12. Notwithstanding any provision herein to the contrary, the performance of any and all obligations of the City hereunder and the performance of any and all conditions contained herein for the benefit of the Underwriter may be waived by the Underwriter, in its sole discretion, and the approval of the Underwriter when required hereunder or the determination of its satisfaction as to any 11 document referred to herein shall be in writing, signed by an appropriate officer or officers of the Underwriter and delivered to you. 13. The approval of the underwriter when required hereunder or the determination of its satisfaction with any document referred to herein shall be in writing signed by a Vice President of William R. Hough & Co. and delivered to you; otherwise, such approval shall be deemed given if the Underwriter accepts delivery of and pays the purchase price for the Bonds at Closing. This Contract of Purchase shall become legally effective upon its acceptance by you, as evidenced by the signature of the Mayor, the City Clerk, and the City Attorney in the spaces provided therefor below. WILLIAM R. HOUGH & CO. Susan F. McGarry, Vice President CITY OF OCOEE, FLORIDA By: Mayor Attest: Clerk, City of Ocoee APPROVED AS TO FORM AND LEGALITY: City Attorney 12 SCHEDULE I Maturity Interest (Oct. 1 ) Amount Rate 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 13 SCHEDULE II Redemption Provisions Optional Redemption The Bonds maturing in the years 1992 to 1999, both inclusive, are not redeemable prior to their stated dates of maturity. The Bonds maturing on and after October 1, 2000 are redeemable prior to their stated dates of maturity, at the option of the City by maturities to be selected by the City and by lot within a maturity if less than a full maturity, in whole on any date on or after October 1, 1999 or in part on any Interest Payment Date on or after October 1, 1999, at a redemption price (expressed as a percentage of the principal amount thereof as set forth in the table below) together with accrued interest to the redemption date, if redeemed in the following periods: Redemption Period Redemption Both Dates Inclusive Price October 1, 1999 to September 30, 2000 102% October 1, 2000 to September 30, 2001 101% October 1, 2001 and thereafter 100% 14 William R. Hough & Co 100 SECOND AVENUE SOUTH April 16, 1991 SUITE 800 ST.PETERSBURG, FLORIDA 33701 (813) 823-8100 City Commission City of Ocoee, Florida Re: $2,580,000 City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1991 Gentlemen: In connection with the proposed issuance by Ocoee, Florida (the "City") of $2,580,000 principal amount of its Capital Improvement Revenue Bonds, Series 1991 (the "Bonds") , William R. Hough & Co. (the "Underwriter") has offered to underwrite a public offering of the Bonds. Arrangements for underwriting the Bonds will include a Contract of Purchase between the City and the Underwriter, which will embody the negotiations in respect thereof. The purpose of this letter is to furnish pursuant to the provisions of Section 218.385(4) , Florida Statutes, certain information in respect of the arrangements contemplated for the underwriting of the Bonds as follows: (a) The nature and estimated amounts of expenses to be incurred by the Underwriter in connection with the purchase and reoffering of the Bonds are set forth in Exhibit A attached hereto. (b) No person has entered into an understanding with the Underwriter, or to the knowledge of the Underwriter with the City, for any paid or promised compensation or valuable consideration, directly or indirectly, expressly or impliedly, to act solely as an intermediary between the City and the Underwriter for the purpose of influencing any transaction in the purchase of the Bonds. (c) The underwriting spread (i .e. , the difference between the price at which the Bonds will be initially offered to the public by the Underwriter and the price to be paid to the City for the Bonds, exclusive of accrued interest in both cases) will be % of the principal amount of the Bonds. (d) The estimated underwriting spread set forth in paragraph (c) above, includes a management fee. No additional management fee will be charged. (e) No other fee, bonus or other compensation is estimated to be paid by the Underwriter in connection with the issuance of the Bonds to any person not regularly employed or retained by the Underwriter (including andy "finder" as defined in Section 218.386(1) (a) , Florida Statutes) , except as specifically enumerated as expenses to be incurred by the Underwriter as set forth in Exhibit A. STATE,COUNTY AND MUNICIPAL BONDS City Commission City of Ocoee, Florida April 16, 1991 Page 2 (f) The name and address of the Underwriter is: William R. Hough & Co. 100 Second Avenue South Suite 800 St. Petersburg, FL 33701 No other dealer firms were associated for the purpose of underwriting the Bonds. We understand that you do not require any further disclosure from the Underwriter pursuant to Section 218.385(4) , Florida Statutes. Very truly yours, WILLIAM R. HOUGH & CO. By: Vice President EXHIBIT A $2,580,000 City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1991 Underwriter's Expenses $ per Bond $ Amount Clearance $ .50 $1,290.00 Federal Funds/Good Faith/Day Loan .30 774.00 Cusip, MSRB, PSA . 10 258.00 Dalnet/Dalcomp .70 1,806.00 Expenses/Closing Costs .80 2,064.00 Total $ 2.40 $6,192.00 AGENDA 4-16-91 PRELIMINARY OFFICIAL STATEMENT DATED APRIL 1, 1991 EItem VI A 2 CO CO • Exhibit .=.0 S NEW ISSUE o«� arts`a In the opinion of Bond Counsel, under existing law, assuming compliance with certain covenants in the Resolution d •- described herein, interest on the Bonds(a)is excludable from gross income for federal income tax purposes and(b)is not an o.0 , item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations,and the • �, Bonds and the interest thereon are exempt from taxation under the laws of the State of Florida, except as to estate taxes and d. A taxes on interest, income or profits on debt obligations owned by corporations, as defined by Chapter 220, Florida Statutes, �,S o as amended. Furthermore, in the opinion of Bond Counsel, based on representations of the City, the Bonds are "qualified a d tax-exempt obligations"within the meaning of Section 265(b)(5) of the Internal Revenue Code of 1986, as amended. See, .9,— however, "TAX EXEMPTION"herein for a description of certain federal minimum and other special taxes that may affect CO COd the tax treatment of interest on the Bonds. 00:` ' o CO $2,580,000* E:=• = CITY OF OCOEE, FLORIDA C N 0 en 1:1 CAPITAL IMPROVEMENT REVENUE BONDS V)0 = SERIES 1991 of O a— 9 w Dated: April 1, 1991 Due: October 1, as shown below =d = The Capital Improvement Revenue Bonds, Series 1991 (the "Bonds")are being issued to provide funds to(i)finance the • o Q expansion of the City of Ocoee's existing City Hall and Police Station, including the acquisition, construction, renovation, . al• = installation and equipping thereof;(ii)fund a Reserve Fund;and(iii)pay expenses related to the issuance and sale of the Bonds. • 0 S 6 The Bonds are issuable as fully registered bonds in denominations of$5,000 each or any integral multiple thereof. The " principal of and redemption premium, if any, on the Bonds will be payable upon presentation thereof at the principal corporate dc 'e trust office of Citizens and Southern Trust Company (Florida), National Association, Ft. Lauderdale, Florida, as Paying g= 0 Agent and Registrar, or its successors. Interest on the Bonds is payable April 1 and October 1 of each year, commencing on i E t October 1, 1991, by check drawn upon the Paying Agent and mailed to the registered owner thereof as of the record date for E a such payments. ▪ a— Payment of the principal of, premium, if any, and interest on the Bonds shall be payable solely from non-ad valorem E1 revenues,budgeted and appropriated for such purpose in each year by the City.Pursuant to the Resolution,the City has O 0a- covenanted to budget and appropriate in its annual budget amount of non-ad valorem revenues sufficient to satisfy the g Z� City's obligation under the Resolution. Such covenant does not, however, constitute a pledge of any funds of the City, o °1= including the non-ad valorem revenues and is subject to certain restrictions more fully described herein. The Bonds do c E o not constitute a general obligation or a pledge of faith, credit or taxing power of the City, the State of Florida or any 8 nE. political subdivision thereof, within the meaning of any constitutional or statutory limitation. Neither the City, the o v—, State of Florida nor any political subdivision thereof shall be obligated to exercise its ad valorem taxing power or any a Y o other taxing power in any form on any real or personal property in the City to pay the principal of the Bonds,the interest A = thereon or other costs incident thereto. e 0 P. The Bonds are subject to optional redemption prior to maturity as more fully described herein. `_' " eaMATURITIES, AMOUNTS, INTEREST RATES AND PRICES _ 40 o en E . Year Principal Interest Rate Price Year Principal Interest Rate Price m = 0 oo e= 1992 2002 = " = 1993 2003 " 2 as 1994 2004 u CO10 = 1995 2005 ea o=z 1996 2006 io z 1997 2007 �Q = 1998 2008 1999 2009 a+w o 2000 2010 E.=vs E. 2001 2011 " = The Bonds are offered when, as and if issued and received by the Underwriters, subject to prior sale and subject to the E W approval oflegality Foley&Lardner, Tampa,Florida,Bond Counsel, and certain other conditions. Certain legal matters 1� g y � 9 r will be passed upon for the City by Foley &Lardner, Tampa, Florida. Evensen Dodge, Inc., Orlando, Florida is acting as 1O"•_E Financial Advisor to the City. It is expected that the Bonds in definitive form will be available for delivery in New York, h d d E Y New York, on or about April 30, 1991. oc°ii Aa 0 s _a= wiltiamR. Hough & Co. .Ep= - d w v. d r gE (V *Preliminary, Subject to Change CITY OF OCOEE, FLORIDA 150 North Lakeshore Drive Ocoee, Florida 34761 (407) 656-6370 City Commission Lester Dabbs, Jr. Mayor Rusty Johnson Commissioner Paul W. Foster . . Commissioner Vern Combs Commissioner Sam Woodson Commissioner City Manager Ellis Shapiro Finance Director City Clerk Ivan A. Poston Jean Grafton City Attorney Foley & Lardner Tampa, Florida Bond Counsel Foley & Lardner Tampa, Florida Financial Advisor Evensen Dodge, Inc. Orlando, Florida Independent Certified Public Accountants McDirmit Davis & Company, P.A. Orlando, Florida i No dealer, broker, salesman or other person has been authorized by the City to give any information or to make any representations other than those contained in this Official Statement,and if given or made,such other 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 or the solicitation of an offer to buy, nor shall there be any sale of the 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 includes information obtained from other sources which are believed to be reliable,but is not guaranteed as to accuracy or completeness by, and is not to be construed as a representation of, the Underwriters. The information and expressions of opinion 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 the implication that there has been no change in the affairs of the City since the date hereof. The Bonds have not been registered under the Securities Act of 1933 in reliance upon an exemption contained in such Act. The registration or qualification of the Bonds in accordance with applicable provisions of the securities laws of the States, if any, in which the 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, other than the City, have passed upon the accuracy or completeness of this Official Statement. IN CONNECTION WITH THE OFFERING OF THE BONDS, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. TABLE OF CONTENTS PAGE INTRODUCTION 1 PURPOSE OF THE BONDS 1 DESCRIPTION OF THE BONDS 1 The Bonds 1 Optional Redemption 2 Notice of Redemption 2 SECURITY FOR THE BONDS 2 Reserve Fund 2 Non-Ad Valorem Revenues 3 HISTORICAL AND PROJECTED NON-AD VALOREM REVENUES 3 Additional Debt Payable from Non-Ad Valorem Revenues 4 DESCRIPTION OF CERTAIN SOURCES OF NON-AD VALOREM REVENUES 5 Half-Cent Sales Tax 5 Franchise Fees 5 Utility Service Tax 6 Municipal Revenue Sharing - Guaranteed Entitlement 6 License and Permit Fees 6 Charges for Services 6 Fines and Forfeitures 6 Cigarette Tax 7 Miscellaneous 7 THE PROJECT 7 ESTIMATED SOURCES AND USES OF FUNDS 7 DEBT SERVICE SCHEDULE 8 ii LEGAL OPINION/LEGAL MATTERS 8 TAX EXEMPTION 9 Federal Tax Matters 9 Florida Tax Matters 10 Qualified Tax-Exempt Obligations 10 LITIGATION 10 • DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS 11 ENFORCEABILITY OF REMEDIES 11 NO VALIDATION 11 FINANCIAL STATEMENTS 11 FINANCIAL ADVISOR 11 UNDERWRITING 11 MISCELLANEOUS 11 CERTIFICATE CONCERNING OFFICIAL STATEMENT 12 APPENDIX A General Information regarding the City of Ocoee A - 1 APPENDIX B The Resolution B - 1 APPENDIX C Audited Financial Statements of Ocoee, Florida C - 1 Fiscal Year Ended September 30, 1990 APPENDIX D Form of Bond Counsel Opinion D - 1 iii [This page intentionally left blank] OFFICIAL STATEMENT $2,580,000* CITY OF OCOEE, FLORIDA CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 1991 INTRODUCTION The purpose of this Official Statement,which includes the cover page and the Appendices hereto,is to furnish information with respect to the issuance by the City of Ocoee, Florida (the "City") of $2,580,000* aggregate principal amount of its Capital Improvement Revenue Bonds, Series 1991 (the "Bonds"), authorized by Resolution No.91-05 adopted at a public meeting held by the City Commission on March 5,1991,as amended and supplemented (the "Resolution"). The Bonds are limited obligations of the City payable solely from and secured by (i) a covenant to budget and appropriate in its annual budget, and to pay as provided in the Resolution, amounts of non-ad valorem revenues sufficient to satisfy the City's obligation under the Resolution, and (ii) until applied in accordance with the provisions of the Resolution, all moneys,including investments thereof,in the Sinking Fund established by the Resolution (the "Pledged Funds"). Capitalized terms used but not defined herein have the same meaning as when used in the Resolution unless the context would clearly indicate otherwise. Complete descriptions of the terms and conditions of the Bonds are set forth in the Resolution, a copy of which is attached as Appendix B to this Official Statement. The description of the 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 referred to herein that are not included in their entirety in this Official Statement may be obtained from the City. PURPOSE OF THE BONDS The Bonds are being issued to provide funds to (i) finance the expansion of the City's existing City Hall and Police Station, including acquisition, construction, renovation, installation and equipping thereof; (ii) fund a Reserve Fund; and (iii) pay expenses related to the issuance and sale of the Bonds. DESCRIPTION OF THE BONDS The Bonds The Bonds are issuable as fully registered bonds in the denomination of $5,000 each or any integral multiple thereof. The principal of and redemption premium, if any, on the Bonds will be payable upon presentation thereof at the principal corporate trust office of Citizens and Southern Trust Company (Florida), National Association,Ft. Lauderdale,Florida, ('Paying Agent and Registrar"), or its successors. Interest on the Bonds is payable semiannually on each April 1 and October 1,commencing on October 1, 1991,by check drawn upon the Paying Agent and mailed to the registered owner thereof at the address shown on the registration books kept by the Registrar on the fifteenth day of the month next preceding each interest payment date. * Preliminary, Subject to Change 1 Optional Redemption The Bonds maturing in the years 1992 to 1999,both inclusive, are not redeemable prior to their stated dates of maturity. The Bonds maturing on and after October 1,2000 are redeemable prior to their stated dates of maturity, at the option of the City by maturities to be selected by the City and by lot within a maturity if less than a full maturity, in whole on any date on or after October 1, 1999 or in part on any Interest Payment Date on or after October 1, 1999, at a redemption price (expressed as a percentage of the principal amount thereof as set forth in the table below) together with accrued interest to the redemption date, if redeemed in the following periods: Redemption Period Redemption Both Dates Inclusive Price October 1, 1999 to September 30, 2000 102% October 1, 2000 to September 30, 2001 101% October 1, 2001 and thereafter 100% Notice of Redemption Notice of redemption, unless waived by any Owner of Bonds, is to be given by the Registrar by mailing a redemption notice by registered or certified mail at least 30 days and not more than 60 days prior to the date fixed for redemption to each Owner of the Bonds to be redeemed at such Owners' addresses shown on the registration books maintained by the Registrar or at such other addresses as shall be furnished in writing by such registered owners to the Registrar. Notice of redemption having been given as aforesaid,the Bonds or portions of the Bonds to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions of Bonds shall cease to bear interest and shall no longer be deemed to be Outstanding. (See Section 2.03 of the Resolution, "Provisions for Redemption"). SECURITY FOR THE BONDS The Bonds will be secured by non-ad valorem revenues budgeted and appropriated by the'City and deposited into the Revenue Fund established under the Resolution. Pursuant to the Resolution,non-ad valorem revenues shall mean all revenues of the City that are not derived from ad valorem taxes and that are legally available for the payment of principal of, and interest on, the Bonds, except that such term shall not include revenues derived from the City's enterprise funds or special revenue funds as such funds are designated in the City's financial statements, and grants-in-aid. Without limiting the generality of the foregoing, "non-ad valorem revenues" shall include, to the extent legally available to pay the principal of and interest on the Bonds, license and permit fees, the half-cent sales tax, fines and forfeitures, franchise fees, and utility taxes, and other intergovernmental revenues. No specific revenue sources of the City have been pledged for the repayment of the Bonds. Reserve Fund The City shall initially deposit to the Reserve Fund in the Debt Service Fund, from the proceeds of the Bonds, an amount equal to $ which is equal to the Reserve Fund Requirement. Moneys in the Reserve Fund shall be used only for payment of principal of and interest on the Bonds when other moneys in the Sinking Fund are insufficient therefor. Any withdrawals from the Reserve Fund shall be restored from the first moneys available in the Revenue Fund after all required payments to the Sinking Fund(including all deficiencies in prior required payments therefrom) have been made in full. 2 Non-Ad Valorem Revenues The following table shows the City's non-ad valorem revenues available to be budgeted for the Bond Service Requirement with respect to the Bonds and the estimated coverage thereon. HISTORICAL AND PROJECTED NON-AD VALOREM REVENUES Fiscal Year Ending September 30 Historical Projected(3) 1988 1989 1990 1991 1992 1993 Franchise Taxes $335,969 $ 353,007 $ 433,529 $ 442,200 $ 451,044 $ 460,064 Utility Taxes(1) 255,487 288,189 389,676 397,470 405,419 413,527 Licenses and Permits 137,009 227,241 591,160 602,983 615,043 627,344 Cigarette Tax 79,420 79,821 84,484 86,174 87,897 89,655 State Revenue Sharing 344,153 329,650 295,454 301,363 307,390 313,538 Sales Tax 841,871 906,575 1,007,456 1,027,605 1,048,157 1,069,120 Other State 18,586 45,533 180,614 184,226 187,911 191,669 Fines and Forfeitures 103,316 105,894 105,927 108,046 110,206 112,411 Charges for Services 57,479 65,087 66,231 67,556 68,907 70,285 Interest Revenues 24,428 6,920 17,097 17,439 17,788 18,143 Miscellaneous Revenues 53,518 104,779 98,723 100,697 102,711 104,766 Total Revenues $2,251,236 $2,512,696 $3,270,351 $3,335,758 $3,402,473 $3,470,523 Maximum Annual Debt Service (2) 250,915 250,915 250,915 250,915 250,915 250,915 Coverage 8.97x 10.O1x 13.03x 13.29x 13.56x 13.83x (1) The City has previously issued $7,000,000 Transportation Refunding and Improvement Revenue Bonds, Series 1990, currently outstanding in the aggregate principal amount of$7,000,000. The final maturity on these Bonds is October 1,2015. The amount of Utility Tax revenues shown above is net of$300,000 which is pledged and used to pay debt service on the 1990 Bonds. (2) Assumes an average coupon of 7.30% (3) Assumes 2% annual growth factor which may or may not be realized. Source for Historical Data: City of Ocoee Finance Department;Audited Financial Statements,1988,1989, 1990. Until the Bonds are paid or deemed paid pursuant to the provisions of the Resolution, the City has covenanted to appropriate in its annual budget,by amendment if necessary,from non-ad valorem revenues legally available to the City in each Fiscal Year,amounts sufficient to pay the principal of,redemption premium,if any, and interest on the Bonds, as the same become due (whether by redemption, at maturity or otherwise). Notwithstanding the foregoing covenant of the City, the City has not covenanted to maintain any services or programs, now provided or maintained by the City, which generate non-ad valorem revenues. With regard to the covenant to budget and appropriate described above, such covenant to budget and appropriate non-ad valorem revenues is not a pledge by the City of such non-ad valorem revenues and is subject in all respects to the payment of obligations secured by a pledge of such non-ad valorem revenues of the City heretofore or hereafter entered into, including the payment of debt service on bonds or other obligations. Such covenant to budget and appropriate is subject to the provisions of Section 166.241(3), Florida Statutes, which makes it unlawful for the City to expend moneys not appropriated and in excess of the City's current budgeted 3 revenues. Such covenant does not require the City to levy and collect any particular non-ad valorem revenues nor to maintain or continue any particular services or programs which generate non-ad valorem revenues. In the Resolution, the City has covenanted that it shall on March 5 and September 5 of each year deposit funds into the Revenue Fund established pursuant to the Bond Resolution in an amount sufficient to pay the next succeeding principal and interest payments due on the Bonds. Until the City takes the action described in the immediately preceding sentence, the Owner has no lien or security interest in the moneys budgeted for such deposit. In addition to the foregoing, the Bonds are secured by a pledge of, and a lien upon: (a) all moneys deposited and held from time to time by the City in certain of the funds and accounts established pursuant to the Resolution; (b) investment income received by the City in certain of the funds and accounts established pursuant to the Resolution and(c)any other moneys received by the Paying Agent in connection with repayment of the Bonds. THE BONDS ARE LIMITED OBLIGATIONS OF THE CITY, PAYABLE SOLELY FROM AND SECURED ONLY FROM REVENUES AS PROVIDED IN RESOLUTION NO.91-05,AS AMENDED AND SUPPLEMENTED (THE "RESOLUTION"). THE BONDS DO NOT CONSTITUTE A GENERAL OBLIGATION, DEBT, OR LIABILITY OF THE CITY OR OF THE STATE OF FLORIDA OR OF ANY POLITICAL SUBDIVISION, AGENCY, OR INSTRUMENTALITY OF THE CITY OR OF THE STATE OF FLORIDA, WITHIN THE MEANING OF THE FLORIDA CONSTITUTION, AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE CITY OR THE STATE OF FLORIDA, OR ANY POLITICAL SUBDIVISION, AGENCY OR INSTRUMENTALITY OF THE CITY OR OF THE STATE OF FLORIDA, IS PLEDGED FOR PAYMENT OF THE PRINCIPAL OF, INTEREST ON, AND PREMIUM, IF ANY, WITH RESPECT TO THE BONDS. Additional Debt Payable from Non-Ad Valorem Revenues The City covenants and agrees that it will not issue any additional debt unless the City can show that following the issuance of or incurring of such additional indebtedness, (a) the total amount of non-ad valorem revenues (based on the most recent fiscal year) will be greater than 1.75 times the Maximum Bond Service Requirement for all Bonds and long term debt then outstanding and the proposed Additional Debt. This requirement does not preclude the City from pledging any specific non-ad valorem revenue as security for future debt issues. "Additional Debt" shall mean debt of the City which is payable from its non-ad valorem revenues and which does not include non-ad valorem revenue derived from the City's enterprise funds or special revenue funds (as such funds are designated in the City's financial statements), which Additional Debt must be issued in accordance with the provisions of the Resolution. "Maximum Bond Service Requirement"means with reference to any Bonds or Additional Debt,for any period of 12 consecutive calendar months for which such calculation is made, the aggregate of the payments to be made in respect of principal and interest on outstanding Bonds or Additional Debt during such period, provided that with respect to Balloon Long-Term Debt such calculation shall include the amount of principal which would be payable in such period if such principal were amortized from the date of incurrence thereof over a period of twenty (20) years (or, if the term thereof exceeds 20 years, over a period equal to such term) on a level debt service basis at an interest rate equal to the rate borne by such indebtedness on the date calculated, except that if the date of calculation is within twelve (12) months of the actual maturity of such indebtedness, the full amount of principal payable at maturity shall be included in such calculation, and except if there is a binding commitment to refinance such Balloon Long-Term Debt,the actual terms of such take-out commitment shall be included in such calculation. 4 DESCRIPTION OF CERTAIN SOURCES OF NON-AD VALOREM REVENUES Half-Cent Sales Tax Pursuant to Chapter 212 and Part VI of Chapter 218, Florida Statutes, one-half cent of the 6% sales tax collected by the State in each city is required to be deposited in the Local Government Half-Cent Sales Tax Clearing Trust Fund in the State Treasury and is earmarked for distribution to each county and each participating municipality within each such county. The City is a participating municipality within Orange County. The half-cent sales tax is distributed to the governing body of each County and each participating municipality within each such county on a monthly basis in accordance with the following formula: County's Share unincorporated area 2/3 x incorporated (percentage of = population + area population total tax total county 2/3 x incorporated receipts) population area population Municipality's Share = municipality population (percentage of total county + 2/3 x incorporated total tax population area population receipts) The formula is revised each year based upon the population estimates prepared by the University of Florida, Bureau of Economic and Business Research. In order to be eligible to receive the half-cent sales tax, the City must certify to the State Department of Revenue each year that it has complied with certain requirements set forth in Chapter 218.23, Florida Statutes. The City has never failed to comply with such requirements. Franchise Fees The City has existing franchises where they receive a percentage of the revenues of services sold to residential and commercial customers within the corporate limits of the City, net of taxes and licenses paid to the City. There is no cap on the rates. The City is currently in the process of renegotiating its contract with Florida Power. These franchise fees currently are as follows: Type Agreement Company of Service Rate Expires Florida Power Corp. Electric 6% 6/1/2000 United Telephone Telephone 1% 7/6/1992 Cablevision Industries TV Cable 3% 7/2/1999 Telesat TV Cable 3% 8/1/1999 Lake Apopka Natural Gas Natural Gas 6% 9/3/2000 Industrial Waste Service, Inc. Refuse Collection 20% 10/1/1993 (Commercial only) Source: City of Ocoee 5 Utility Service Tax Section 166.231,Florida Statutes,authorizes municipalities to levy a tax on the purchase of certain utility services within the municipality at a rate not to exceed 10%of the payments received by the seller of the taxable item. The City has adopted an ordinance levying a utility tax on the purchase of electricity, metered or bottled gas,fuel oil,telephone service,and telegraph service delivered in the corporate limits of the City. The City's tax is imposed at a rate of 10% of the amount received by the seller of such utility services. The tax is paid to the seller of the utility service and is remitted by said seller to the municipality as prescribed by the City's ordinance. Federal, State, other public bodies, church buildings used for church purposes and the utilities providing the service,are exempt from the tax. The sale of natural gas to a public or private utility,including a utility operated by the City, and rural electric cooperative associations, either for resale or for use as a fuel in the generation of electricity, is exempt under the terms of the City's ordinance. Municipal Revenue Sharing - Guaranteed Entitlement Chapter 218, Part II, Florida Statutes, describes the structure of the State's revenue sharing program. The Municipal Revenue Sharing Trust Fund contains funds from three sources: • 32.4%of the net collection of the 33.9 cents per pack cigarette tax authorized by Section 210.20, Florida Statutes • proceeds from the one cent Municipal Gas Tax levied pursuant to Section 206.605, Florida Statutes and • 25% of the proceeds from the State Alternative Fuel Decal Users Fee collected pursuant to Section 206.877, Florida Statutes. Several formulas are used to determine the distribution of funds to local governments. These formulas use measures of population,area,economic activity and property assessments to derive a factor which represents a local government's proportional share of the funds to be distributed. These proportions are calculated annually by the Florida Department of Revenue(DOR),which has the responsibility for administering the revenue sharing program. In general though, municipalities incorporated prior to 1972 receive a "hold harmless or guaranteed" amount equal to what they received in FY 1971-72 (the "Guaranteed Entitlement"). Remaining monies in the trust fund after this distribution are referred to as "growth monies", and are distributed to all eligible municipalities according to formulas developed by the DOR. License and Permit Fees License and Permit Fees include occupational license and inspection fees plus revenues from building permits. Charges for Services Charges for services consist of recreation, public safety, zoning, inspection and administration fees. Fines and Forfeitures Fines and Forfeitures consist of fines and penalties collected in the City due to violations of criminal and civil laws and City ordinances, and court costs assessed against defendants. 6 Cigarette Tax Florida Statutes, Chapter 210.20(2) states that as collections are received by the Division of Alcoholic Beverages and Tobacco from cigarette taxes, it shall pay such amount into the Cigarette Tax Collection Trust Fund. Two twenty-first (2/21) of such amount is credited and distributed to the City through the Municipal Financial Assistance Trust Fund. Miscellaneous Miscellaneous revenues of the City consist of rental income, interest earnings, sale of equipment, contributions and other revenues. THE PROJECT Approximately$ of the Bond proceeds will be deposited into the Project Funds upon delivery of the Bonds and used for the purposes of expanding the City's existing City Hall and Police Station located at Starke Lake. The City Hall expansion will consist of a new 12,000 square foot one-story structure plus renovation of the existing 4,000 square foot building at an estimated cost of$1,500,000. The Police Station expansion will consist of a new 7,800 square foot one-story structure,plus renovation of the 3,200 square foot existing building at an estimated cost of$900,000. The following amounts will be deposited into each respective Project Fund. City Hall Expansion Project Fund $ Police Station Expansion Project Fund Total $ ESTIMATED SOURCES AND USES OF FUNDS Sources of Funds: Principal Amount of the Bonds $ Accrued Interest Total Sources $ Uses of Funds: Deposit to Project Funds(1) $ Deposit to Sinking Fund (Accrued Interest) Underwriter's Discount and Cost of Issuance(2) Total Uses (1) Does not include estimated investment earnings of approximately$ (2) Includes bond counsel, issuers counsel, administrative and other costs associated with the issuance of the Bonds. 7 DEBT SERVICE SCHEDULE City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1991 Annual Bond Service Requirements Bond Year Ending Total Principal October 1 Principal Interest & Interest • 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 TOTAL LEGAL OPINION/LEGAL MATTERS Legal matters incident to the issuance of the Bonds and with regard to the tax-exempt status of the interest on the Bonds (see"Tax Exemption" herein) are subject to the legal opinion of Foley& Lardner,whose legal services as Bond Counsel have been retained by the City. A signed copy of the opinion, dated and premised on law in effect as of the date of delivery of the Bonds will be delivered to the Underwriter at the time of delivery, and the text of the opinion will be attached to the Bonds. The text of the proposed legal opinion is set forth as Appendix D. The actual legal opinion to be delivered may vary from the text if necessary to reflect facts and law on the date of delivery. The opinion will speak only as of its date,and subsequent distribution of it by recirculation of the Official Statement or otherwise shall create no implication that Bond Counsel has reviewed or expresses any opinion concerning any of the matters referred to in the opinion subsequent to its date. Foley & Lardner will also pass on certain legal matters for the City. 8 TAX EXEMPTION Federal Tax Matters The Internal Revenue Code of 1986, as amended (the"Code"), contains a number of requirements and restrictions which apply to the Bonds, including investment restrictions, a requirement of periodic payments of arbitrage profits to the United States,requirements regarding the use of bond proceeds and the facilities financed therewith, and certain other matters. The City has covenanted to use its best efforts to comply with all requirements of the Code that must be satisfied in order for the interest on the Bonds to be excluded from gross income for federal income tax purposes. Failure to comply with certain of such requirements could cause interest on the Bonds to be included in gross income retroactive to the date of issuance of the Bonds. Subject to the condition that the City comply with the pertinent requirements of the Code,under existing law,in the opinion of Bond Counsel,interest on the bonds will be excluded from the gross income of the owners thereof for federal income tax purposes and will not be treated as an item of tax preference in computing the alternative minimum tax for individuals and corporations. Reference is made to a proposed form of the bond Counsel opinion attached hereto as Appendix D for the complete text thereof. In rendering the opinion, Bond Counsel will rely upon certificates of the City with respect to certain material facts relating to the property financed with the proceeds of the Bonds and the application of the proceeds of the Bonds. The Code contains numerous provisions which could affect the economic value of the Bonds to certain owners of the Bonds. The following is a brief summary of some of the significant provisions that may be applicable to particular owners of the Bonds. Prospective owners of the Bonds, however, should consult their own tax advisors with respect to the impact of such provisions on their own tax situations. Insurance companies(other than life insurance companies) are required for all taxable years beginning after 1986 to reduce the amount of their deductible underwriting losses by 15% of the amount of tax-exempt interest received or accrued on certain obligations, including the Bonds, acquired after August 7, 1986. If the amount of the reduction exceeds the amount otherwise deductible as losses incurred, such excess may be includable in income. Life insurance companies are subject to similar provisions under which taxable income is increased by reason of receipt or accrual of tax-exempt interest, such as interest on the Series 1990 Bonds. Interest on the Bonds must be included in the adjusted net book income of corporations (other than S corporations, regulated investment companies, real estate investment trusts, and REMICs) for taxable years beginning in 1986, 1988 and 1989,and such corporations are required to include in their calculation of alternative minimum taxable income 50% of the excess of adjusted net book income over alternative minimum taxable income (determined without regard to this adjustment and prior to reduction for certain net operating losses). For taxable years beginning after 1989, the use of"adjusted net book income" is to be replaced with "adjusted current earnings". Interest on the Bonds will be included in"adjusted current earnings." For such taxable years, the alternative minimum taxable income of corporations must be increased by 75% of the excess of adjusted current earnings over alternative minimum taxable income (determined without regard to this adjustment and prior to reduction for certain net operating losses). 9 An environmental tax is imposed on corporations (other than S Corporations, regulated investment companies, real estate investment trusts and REMICs) by Section 59A of the Code. The environmental tax is effective for taxable years beginning after 1986 and before 1992. The amount of the environmental tax is equal to 0.12% of the excess of the alternative minimum taxable income (determined without regard to net operating losses and the deduction for the environmental tax) over $2 million. The environmental tax may be imposed even if the corporation pays no alternative minimum tax because the corporation's regular income tax liability exceeds its alternative minimum tax liability. For purposes of the environmental tax,alternative minimum taxable income includes interest on tax-exempt obligations, such as the Bonds, to the same extent and in the same manner as such interest is included in alternative taxable income as described in the preceding paragraph. Certain recipients of social security benefits and railroad benefits are required to include a portion of such benefits in gross income by reason of the receipt or accrual of interest on tax-exempt obligations, such as the Bonds. For foreign corporations operating branches in the United States, Section 884 of the code imposes a branch level tax on certain earnings and profits in tax years beginning after 1986. Interest on tax-exempt obligations, such as the Bonds, may be included in the determination of such domestic branches' taxable base on which this tax is imposed. Passive investment income, including interest on the Bonds, may be subject to federal income taxation under Section 1375 of the Code for S corporations which have subchapter C earnings and profits at the close of the taxable year and greater than 25%of the gross receipts if the S corporation consists of passive investment income. Florida Tax Matters It is also the opinion of Bond Counsel that, under existing law, the Bonds and the interest thereon are exempt from taxation under the laws of the State of Florida, except as to estate taxes and taxes on interest, income or profits on debt obligations owned by corporations as defined by Chapter 220, Florida Statutes, as amended. Qualified Tax-Exempt Obligations (Bank Deductibility) Assuming the City can recertify certain representations and findings made by the City in the Resolution upon the issuance of the Bonds,the Bonds are"qualified tax-exempt obligations" (within the meaning of Section 265(b)(5) of the Code), and in the case of certain financial institutions(within the meaning of Section 265(b)(5) of the Code), a deduction is allowed for 80%of that portion of the interest expense of such financial institutions which shall be allocable to interest on the Bonds. LITIGATION In the opinion of Foley& Lardner,Tampa, Florida, no legal proceedings are pending or to the best of their knowledge threatened which materially affect the City's ability to perform its obligations to the Owners of the Bonds or materially affect the financial condition of the City. There is no litigation or controversy of any nature now pending or, to the best knowledge of the City, threatened to restrain or enjoin the issuance, sale, execution or delivery of the Bonds or in any way contesting the validity of the Bonds or any proceedings of the City taken with respect to the authorization, sale or issuance of said Bonds or the pledge or application of any moneys provided for the payment of the Bonds. 10 DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS Section 517.051, Florida Statutes, and the regulations promulgated thereunder (the "Disclosure Act") requires that the City make a full and fair disclosure of any bonds or other debt obligations that it has issued or guaranteed and that 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 only as a conduit issuer such as industrial development or private activity bonds issued on behalf of private businesses). The City is not and has not since December 31, 1975 been in default as to principal and interest on its bonds or other debt obligations. ENFORCEABILITY OF REMEDIES The remedies available to the owners of the Bonds upon an event of default under the Resolution are in many respects dependent upon judicial actions which are often subject to discretion and delay. Under existing constitutional and statutory law and judicial decisions, the remedies specified by the Resolution and the Bonds may not be readily available or may be limited. The various legal opinions to be delivered concurrently with the delivery of the bonds (including Bond Counsel's approving opinion) will be qualified, as to the enforceability of 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. NO VALIDATION Validation was not required by law for the issuance of the Bonds and the Bonds were not submitted for validation. FINANCIAL STATEMENTS Included in Appendix C are the General Purpose Financial Statements of the City of Ocoee as of September 30, 1990 which have been examined by the City's independent certified public accountant. FINANCIAL ADVISOR Evensen Dodge,Inc.,Orlando,Florida,is serving as financial advisor to the City with respect to the sale of the Bonds. Evensen Dodge,Inc.is a financial advisory and consulting organization and is not engaged in the business of underwriting, marketing or trading of municipal securities or any other negotiable instruments. UNDERWRITING The Bonds are being purchased by the Underwriter, William R. Hough & Co. The Bond Purchase Agreement for the Bonds provides that the Underwriter will purchase all of the Bonds,if any are purchased for $ plus accrued interest from April 1, 1991. The Underwriter may offer and sell the Bonds to certain dealers and others at prices lower than the public offering prices stated on the cover page hereof. MISCELLANEOUS The references, excerpts and summaries of all documents,resolutions and ordinances referred to herein do not purport to be complete statements of the provisions of such documents, resolutions and ordinances and reference is directed to all such documents, resolutions and ordinances for full and complete statements of all matters of fact relating to the Bonds, the security for and the repayment of the bonds and the rights and obligations of the Holders thereof. Copies of such documents,resolutions and ordinances may be obtained from the City Clerk's Office. 11 CERTIFICATE CONCERNING OFFICIAL STATEMENT Concurrently with the delivery of the Bonds, the City will furnish its certificate, executed by the Mayor or Mayor Pro Tern of the City, to the effect that, to the best of his knowledge, this Official Statement, as of its date and as of the date of delivery of the Bonds, does not contain an untrue statement of a material fact and does not omit to state a material fact which should be included therein for the purpose for which the Official Statement is to be used, or which is necessary to make the statements contained therein, in the light of the circumstances under which they were made, not misleading. At the time of delivery of the Bonds to the Underwriter, the City will provide to the Underwriter a certificate (which may be included in a consolidated closing certificate of the City),signed by those City officials who signed this Official Statement, relating to the accuracy and completeness of this Official Statement and to its being a "final official statement" in the judgment of the City for purposes of SEC Rule 15c2-12(b)(3). CITY OF OCOEE, FLORIDA BY: Mayor 12 APPENDIX A GENERAL INFORMATION 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 INFORMATION WHERE PRACTICABLE. THE SERIES 1991 BONDS ARE NOT GENERAL OBLIGATIONS OF THE STATE OF FLORIDA OR ANY POLITICAL SUBDIVISION THEREOF, INCLUDING THE CITY OF OCOEE, FLORIDA. 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, Florida, and on the south by Windermere, Florida and has a land area of 8.0 square miles, thus making it the second largest city in land area of the thirteen cities in Orange County, Florida. State Roads 50, 437, and 438 are the major roads with easy access to City residents. Ocoee is the juncture of Orlando's East- West Expressway and the proposed western beltway, estimated to be completed by about 1992. As of July, 1990, the population of Ocoee was estimated at 13,852 by the City of Ocoee Planning Department. Ocoee ranks third in population of the cities in Orange County. The average household income as estimated by the West Orange Chamber of Commerce for the Winter Garden/City of Ocoee area is $22,000 and the median age of an Ocoee resident is 26.7 years of age. Population The following table sets forth the population trends in the City of Ocoee and Orange County from 1960 through 2000. Average Average Annual Annual City of Percentage Orange Percentage Year Ocoee(1) Increase Coun Increase 1960 2,500 --- 263,540 1970 3,937 5.7% 344,311 3.06% 1980 7,803 9.8 471,016 3.68 1986 11,135 8.0 577,856 3.79 1990 12,778 3.6 677,491 4.31 2000 22,357(1) 7.4 843,592(2) 2.40 (1) Population Projection by the City of Ocoee, Florida (2) Population as projected by Population Studies, Population Program, Bureau of Economic and Business Research, University of Florida, June, 1990. Source: U. S. Department of Commerce, Bureau of the Census 1960, 1980, and 1990. Florida Estimates of Population, Population Program, Bureau of Economic and Business Research, University of Florida, April 1, 1986. A-1 Government The City is governed by a Manager-Commission 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. Date Term Members Expires Lester Dabbs, Jr., Mayor November, 1992 Rusty Johnson, Commissioner November, 1992 Paul W. Foster, Commissioner November, 1993 Vern Combs, Commissioner November, 1992 Sam Woodson, Commissioner November, 1991 Police and Fire Protection Approximately 40 law enforcement personnel and 25 fire protection personnel provide twenty-four hour police and fire protection. Recreation The major public facilities include the Community Center and the Youth Center. The City has a total of two recreation centers and four parks and manages a variety of leisure activities throughout the year for its citizenry. Budget Preparation 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. Employees' Defined Pension Plan and Trust The City contributes to a defined benefit pension plan and trust. The plan was effective as of October 1, 1985. The City's payroll for employees covered by the plan for the year ended September 30, 1990 was $2,462,828. The City's total payroll for the year ended September 30, 1990 was $2,551,030. There were 109 active members who were covered as of October 1, 1990. City employees are eligible to participate in the plan after they have completed six months of service with a minimum of 500 work hours during the six month period. Benefits fully vest on reaching five years of service. Each participant's normal retirement benefit shall be 20% of the participant's average monthly compensation, reduced by 1/30 for each year by which his years of benefit service (commencing on employment date) at the normal retirement date (age 55) are less than thirty. The plan provides death but not disability benefits. These benefit provisions and all other requirements are established by City ordinance. City employees are not required or permitted to contribute to the plan. The City is required to contribute the full amount necessary to fund the plan, using the actuarial basis specified by City ordinance. A-2 Economic Summary In the City of Ocoee there are several major employers including the Florida Auto Auction, Wal- Mart, the Holiday Inn, Certi-Fine Fruit Company, Inc., the Colony Plaza Hotel, Amber Electric, Sysco, Inc., a large food distributorship, and Whitaker Oil Company, a chemical concern. Ocoee's industrial base is diverse, ranging from stained glass artistry to casket and burial vault production. Education The Orange County area has four major institutions of higher learning: University of Central Florida (a four year state university with an enrollment of more than 16,500 full and part-time students); Rollins College (the oldest four-year institution of higher learning in the State, an independent, coeducational, liberal arts college with an enrollment of more than 1,400 students); Seminole Community College (a two-year undergraduate institution with 8,500 students); Valencia Community College (a two-year undergraduate institution covering three campuses with over 12,000 full and part-time students). The Orange, Seminole and Osceola County area is well equipped with elementary, secondary, vocational and private schools. Public school enrollment for the 1989-1990 school year totaled over 159,000. Source: Economic Development Commission of Mid-Florida, Opportunity Orlando, 1990. Transportation The Orlando MSA is primarily served by Orlando International Airport. Orlando International Airport ranks as the 17th busiest domestic facility and the 25th busiest world facility. Designated an international port of entry with full customs service, the airport has grown tremendously since 1970. Air passengers have increased from 1.3 million in 1971 to over 17.3 million in 1989. Forty-seven air carriers serve the Orlando area with more than 450 daily flights. The third runway at Orlando International Airport opened in September of 1989, while the fourth runway is currently being reviewed in the DRI process. The construction of a third airside terminal and an expansion of the landside terminal is nearing completion. The area is also served by three satellite airports: Orlando Executive Airport, Central Florida Regional Airport and Kissimmee Municipal Airport. Orange County is crossed by Interstate 4 and the Florida Turnpike. The Martin Anderson Beeline Expressway links the east coast beaches with Interstate 4 and the Florida Turnpike. The Holland East-West Expressway expedites traffic through the City of Orlando. The Orlando/Orange County Expressway Authority recently completed a portion of the Eastern Beltway in Orange County as well as the eastern expansion of the East-West Expressway. Recently opened is the remaining portion of the Eastern Beltway in Orange County as well as the western extension of the East-West Expressway. Future plans include the completion of the belt line around the Orlando area as well as the Central Connector that will connect downtown Orlando with the Orlando International Airport; consideration is also being given to the feasibility of a transit system between the airport and the International Drive area. The metropolitan area is served by 35 common-carrier trucklines, 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. Greyhound recently opened its new $2.4 million complex in west Orlando. Both passenger and freight rail systems provide service to the area. Amtrak currently operates two trains daily between New York and the Orlando area. CSX Transportation moves freight between north and south Atlantic points and connects with all major U.S. rail lines. A-3 Seaboard Coastline Railroad provides freight service to the area. Rail passenger stations in the Orlando area are among the busiest in the southeast with 600 Amtrak passengers arriving and departing on four daily trains. Source: Economic Development Commission of Mid-Florida and Orange County Planning Department. Employment Prior to 1967, the Orlando 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. Over the past sixteen years, construction of Walt Disney World, EPCOT Center, Disney-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 had resulted in a larger share of total employment being represented by the trade and service areas when compared with the national average. During 1989, annual average employment in Orange County grew to 386,324 with an average unemployment rate of 5.0%. LARGEST EMPLOYERS IN ORLANDO MSA 1989 Number of Name of Employer Employees Walt Disney World Company 31,000 U. S. Naval Training Center 17,000 Orange County Public Schools 14,500 Martin Marietta Electric and Missile Group 12,600 Orange County Government 6,289 A T & T Information Systems 5,400 United States Postal Service 5,250 Florida Hospital 5,288 Seminole County Public Schools 5,221 Orlando Regional Medical Center 4,551 Publix Supermarkets, Inc. 4,484 Winn Dixie 4,075 City of Orlando 3,679 General Mills Restaurant Group 3,500 Source: Economic Development Commission of Mid-Florida Community Data Sheet 1990. A-4 CITY OF OCOEE, FLORIDA TAXABLE ASSESSED PROPERTY VALUATION Real Personal Property Property Total Fiscal Assessed Assessed Assessed Year Value Value Value 1981 $ 56,376,129 $ 7,877,747 64,253,876 1982 62,467,539 8,766,539 71,234,078 1983 66,174,334 8,952,929 75,127,263 1984 72,498,499 9,827,873 82,326,372 1985 85,087,900 10,314,135 95,402,035 1986 107,665,821 10,423,536 118,089,357 1987 126,876,147 12,708,713 139,584,860 1988 180,610,206 16,583,819 197,194,025 1989 198,284,327 20,307,367 218,591,694 1990 249,015,145 24,635,177 273,650,322 Source: City of Ocoee Finance Department 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. MILLAGE RATES FOR THE CITY OF OCOEE, FLORIDA Fiscal City of Orange School Year Ocoee County Board Total(a) 1981 4.4677 5.54729 8.289 18.30399 1982 4.50 5.9908 6.812 17.3028 1983 3.15 4.9908 7.20 15.3408 1984 3.17 4.4148 6.84 14.4248 1985 3.14 4.1166 6.73 13.9866 1986 3.14 4.9611 7.28 15.3811 1987 2.90 4.5144 7.55 14.9644 1988 2.80 4.5144 7.347 14.6614 1989 4.00 5.2889 8.414 17.7029 1990 4.00 5.2889 8.271 17.5599 (a) Tax Rates and levies of a fraction of one mill assessed by other units against districts covering less than the entire City or County are omitted here. Source: Office of the Finance Director, City of Ocoee; and the Property Appraiser's Office, Orange County, Florida. A-5 TEN PRINCIPAL TAXPAYERS FOR THE CITY OF OCOEE, FLORIDA September 30, 1990 Type of Taxpayer Business Valuation Percentage Arvida/JMB Partners Developer $ 8,296,050 3.03% Florida Auto Auction Auto Auction 7,561,337 2.76 BSL Investors II Developer 6,009,784 2.20 Sysco Corporation Food Distribution 5,993,968 2.19 Westlake Partners, Ltd. Developers 5,742,694 2.10 Towne Square Associates Shopping Center 5,533,159 2.02 Pulte Home Corporation Developer 4,107,742 1.50 M/I Schottanstein Homes Developer 3,899,200 1.42 Good Homes Plaza, Inc. Shopping Center 3,523,517 1.29 PRN Investments/BML Invest. Developer 3378,916 1.23 Total Taxable Assessed Value of 10 Largest Taxpayers 54,046,367 19.74% Total Taxable Assessed Value of Other Taxpayers 219.606,955 80.26% Total Taxable Assessed Value of All Taxpayers $273,653,322 100.00% A-6 CITY OF OCOEE, FLORIDA BUILDING PERMIT ACTIVITY LAST TEN CALENDAR YEARS ' Residential Construction Commercial Additions Number of Units Construction Alterations One - Multi- Total Year Family Family Value Value Value Value 1981 379 3 $ 6,771,000 $1,085,000 $ 747,000 $ 8,603,000 1982 195 -- 3,669,000 813,000 1,005,000 5,487,000 1983 61 -- 1,662,000 886,000 813,000 3,361,000 1984 62 46 3,449,000 1,014,000 509,000 4,972,000 1985 139 -- 6,475,000 5,273,000 1,415,000 13,163,000 1986 116 6 6,572,000 2,138,000 428,000 9,138,000 1987 118 6 5,610,000 9,553,000 983,000 16,146,000 1988 143 14 9,291,000 2,339,000 1,107,876 12,737,876 1989 239 6 14,656,699 8,183,652 1,012,399 28,852,750 1990 297 265 30,956,225 8,585,195 780,078 40,321,498 Source: University of Florida, Bureau of Economic and Business Research. ORANGE COUNTY, FLORIDA BANK DEPOSITS (in thousands) Savings and Year Banks Loans 1981 $2,151,847 $1,320,303 1982 2,178,534 1,397,120 1983 2,791,758 1,743,917 1984 3,243,587 1,890,968 1985 3,951,142 2,239,660 1986 4,449,184 2,180,242 1987 4,195,881 2,315,245 1988 4,530,190 2,501,530 1989 4,888,783 3,050,283 1990 5,524,771 1,803,816 Source: Florida Bankers Association. Amounts for 1980 - 1986 are as of December 31; amounts for 1987 - 1989 are as of September 30. Federal Home Loan Bank Research Department. Amounts for 1980 - 1983, 1986 - 1989 are as of June 30. Amounts for 1984 and 1985 are as of December 31. A-7 [This page intentionally left blank] APPENDIX B RESOLUTION NO. 91- 05 RESOLUTION PROVIDING FOR THE ACQUISITION, CONSTRUCTION, EXPANSION, RENOVATION, INSTALLATION AND EQUIPPING OF THE CITY OF OCOEE'S CITY HALL AND POLICE STATION; AUTHORIZING THE ISSUANCE BY THE CITY OF NOT EXCEEDING $2 , 600, 000 CAPITAL IMPROVEMENT REVENUE BONDS TO FINANCE THE COST THEREOF; COVENANTING TO BUDGET AND APPROPRIATE CERTAIN FUNDS FOR THE PAYMENT OF THE BONDS AND PLEDGING ALL MONEYS ON DEPOSIT TO THE CREDIT OF THE SINKING FUND AND THE REVENUE FUND CREATED HEREUNDER AND THE EARNINGS ON THE INVESTMENT THEREOF TO SECURE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS; MAKING CERTAIN COVENANTS AND AGREEMENTS FOR THE BENEFIT OF THE OWNERS OF THE BONDS; AUTHORIZING A NEGOTIATED SALE OF THE BONDS; APPOINTING THE REGISTRAR AND PAYING AGENT FOR THE BONDS; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE, FLORIDA, AS FOLLOWS: B - 1 TABLE OF CONTENTS Page ARTICLE I GENERAL Section 1. 01 Definitions 1 Section 1. 02 Authority for this Instrument 5 Section 1. 03 Findings 6 Section 1. 04 Project Authorized 7 ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF BONDS Section 2 . 01 Authorization of Bonds 8 Section 2 . 02 Payment of Bonds and Interest 8 Section 2 . 03 Provisions for Redemption 9 Section 2 . 04 Execution of Bonds 12 Section 2 . 05 Negotiability and Registration 13 Section 2 . 06 Bonds Mutilated, Destroyed, Stolen or Lost 15 Section 2 . 07 Form of Bonds 15 ARTICLE III COVENANTS, SPECIAL FUNDS AND APPLICATION THEREOF Section 3 . 01 Bonds Not to Be General Obligations of Issuer 16 Section 3 . 02 Security for Bonds 16 Section 3 . 03 Application of Section 2 . 01 Bond Proceeds17 -i- B - 2 Section 3 .04 Covenants of the Issuer 19 (A) Revenue Fund 19 (B) Sinking Fund 19 (C) Trust Funds 20 (D) Issuance of Additional Obligations 22 (E) Events of Default and Remedies 22 (F) Records and Audits 27 (G) Fidelity Bond 27 (H) Creation of Superior Liens 27 (I) Compliance with Code 28 ARTICLE IV MISCELLANEOUS PROVISIONS Section 4 . 01 General Authority 29 Section 4 . 02 No Personal Liability 29 Section 4 . 03 No Third Party Beneficiaries 3,0 Section 4 . 04 Compliance with Chapter 218 , Part III, Florida Statutes 30 Section 4 . 05 Defeasance 30 Section 4 . 06 Modification or Amendment 31 Section 4 . 07 Sale of Section 2 . 01 Bonds and Distribution of Preliminary Official Statement 33 Section 4 . 08 Registrar and Paying Agent 33 Section 4 . 09 Additional Provisions 33 Section 4 . 10 Severability of Invalid Provisions 33 Section 4 . 11 Repeal of Inconsistent Resolutions 34 -ii- B - 3 Section 4 . 12 Table of Contents and Heading not Part Hereof 34 Section 4 . 13 Effective Date 34 Section 4 . 14 Adoption at Public Hearing 34 Appendix A - Additional Definitions Appendix B - Additional Debt Appendix C - Description of Section 2 . 01 Bonds Appendix D - Revenues Appendix E - [Intentionally Omitted] Appendix F - Additional Findings/Additional Provisions Appendix G - Form of Bond -iii- B - 4 ARTICLE I GENERAL 1. 01 Definitions. Unless the text clearly otherwise requires, when used in this Instrument the terms defined in Appendix A shall have the respective meanings assigned therein and the following terms shall have the following meanings: "Additional Debt" shall mean debt of the Issuer payable from its non-ad valorem revenues which does not include debt payable from non-ad valorem revenues derived from the Issuer's enterprise funds or special revenue funds as such funds are designated in the Issuer's financial statements, which Additional Debt must be issued in accordance with the provisions of Appendix B hereto. "Authorized Depository" shall mean the State Board of Administration and any state banking corporation or national banking association situated in the State of Florida which is a member of the Federal Deposit Insurance Corporation and which is eligible under the laws of the State of Florida to receive deposits of funds of the Issuer. "Authorized Investments" shall mean all accounts with the State Board of Administration of the State of Florida and, subject to any limitations which may be contained in Appendix F hereto, any investments which shall be authorized from time to time by applicable laws of the State of Florida for deposit or purchase by the Issuer for the temporary investment of its funds. -1- B - 5 "Bond Counsel" shall mean Foley & Lardner, Tampa, Florida. "Bond Register" shall mean the registration books of the Issuer, kept by the Registrar, for the purpose of registering ownership of the Bonds. "Bonds" shall mean the Section 2. 01 Bonds. "Bond Service Requirement" for any Bond Year shall mean the amount required to pay the principal of and interest on the Bonds during such Bond Year. "Bond Year" shall mean the period commencing on the day after the principal maturity date of the Bonds each calendar year and ending on the principal maturity date of the Bonds in the next succeeding calendar year. Each Bond Year shall be designated with the number of the calendar year in which such Bond Year ends. "Closing" shall mean the delivery of the Bonds by the Issuer to the Underwriter upon payment by the Underwriter to the Issuer of the purchase price therefor in full. "Code" shall mean the United States Internal Revenue Code of 1986, as the same may be amended from time to time, or any successor enactment, and the regulations thereunder, whether proposed, temporary or final, promulgated by the Department of the Treasury, Internal Revenue Service. "Cost" when used in connection with the Project, shall mean all expenses necessary, appurtenant or incidental to the reimbursement, acquisition, construction and installation of the Project, including without limitation the cost of any land or -2- B - 6 interest therein or of any fixtures, equipment or personal property necessary or convenient therefor, the cost of labor and materials to complete such construction, architectural, engineering and legal expenses, fiscal expenses, expenses for estimates of costs and of revenues, expenses for plans, specifications and surveys, interest during construction, administrative expenses related solely to the acquisition and construction of the Project and all expenses incident to the financing of the Project and the issuance of the Bonds. "Federal Securities" shall mean (i) direct obligations of q the United States of America including obligations issued or held in book-entry form on the books of the Department of the Treasury, (ii) REFCORP obligations issued by the Resolution Trust Company and (iii) obligations the principal of and interest on which are unconditionally guaranteed by the United States of America. "Fiscal Year" shall mean the period commencing on October 1 of each year and ending on September 30 in the next succeeding year. "Instrument" shall mean this resolution and all resolutions amendatory hereof which may be hereafter duly adopted by the Issuer. "Interest Payment Dates" shall mean the dates designated as such in Appendix G hereto. "Maximum Bond Service Requirement" means with reference to any Bonds or Additional Debt, for any period of 12 consecutive calendar months for which such calculation is made, the aggregate -3- B - 7 of the payments to be made in respect of principal and interest on outstanding Bonds or Additional Debt during such period, provided that with respect to Balloon Long-Term Debt such calculation shall include the amount of principal which would be payable in such period if such principal were amortized from the date of incurrence thereof over a period of twenty (20) years (or, if the term thereof exceeds 20 years, over a period equal to such term) on a level debt service basis at an interest rate equal to the rate borne by such indebtedness on the date calculated, except that if the date of calculation is within twelve (12) months of the actual maturity of such indebtedness, the full amount of principal payable at maturity shall be included in such calculation, and except if there is a binding commitment to refinance such Balloon Long-Term Debt, the actual terms of such take-out commitment shall be included in such calculation. "Owner" shall mean the Person in whose name any outstanding Bond is registered according to the Bond Register. "Person" shall mean an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof. "Pledged Funds" shall mean the Revenues deposited in the Revenue Fund and all moneys on deposit to the credit of the Sinking Fund and the interest and earnings to be derived by the Issuer on the investment thereof. -4- B - 8 "Project Accounts" shall mean the special account created pursuant to Section 3 . 03 hereof into which the Issuer shall deposit a portion of Bond proceeds. "Registrar" shall mean the institution appointed by Section 4 . 08 hereof, or any bank or other qualified institution hereafter appointed as successor registrar and paying agent for the Bonds by resolution of the Governing Body. "Revenue Fund" shall mean the account created pursuant to the provisions of Section 3 . 04 (A) of this Instrument, into which the Issuer shall deposit as required on a semi-annual basis, the Revenues. "Revenues" shall mean that portion of the non-ad valorem revenues of the Issuer (described and defined in and by Appendix D hereto) which the Issuer has covenanted to budget and appropriate for each Fiscal Year while the Bonds are outstanding in order to pay the principal, interest, and redemption premium, if any, on the Bonds from its non-ad valorem revenues. "Section 2 . 01 Bonds" shall mean the Bonds authorized to be issued pursuant to the provisions of Section 2 . 01 hereof. "Sinking Fund" shall mean the account created pursuant to the provisions of Section 3 . 04 (B) of this Instrument. "Underwriter" shall mean William R. Hough & Co. 1. 02 Authority for this Instrument. This Instrument is enacted pursuant to the provisions of the Act and other applicable provisions of law. -5- B - 9 1. 03 Findings. It is hereby found and determined: all of the findings specified in Appendix F hereto, and, in addition, that: (A) The Project is necessary for the health, welfare, safety and economy of the citizens and inhabitants of the Issuer. (B) It is necessary and in the best interest of the finances and economy of the Issuer that all or a part of the Cost of the Project be financed with the proceeds from the sale of the Section 2 . 01 Bonds. (C) The Pledged Funds will be sufficient in each Bond Year to pay the principal of and interest on the Section 2 . 01 Bonds which shall become due and payable in such Bond Year. It is deemed necessary and desirable to covenant to appropriate the Pledged Funds to the payment of the principal of and interest on the Section 2 . 01 Bonds. (D) The Issuer is not, under this Instrument, obligated to levy any ad valorem taxes on any real or personal property situated within its territorial limits to pay the principal of, premium, if any, or interest on the Bonds. The Bonds shall not constitute a lien upon any property of the Issuer other than the Pledged Funds. (E) This Instrument is declared to be and shall constitute a contract between the Issuer and all Owners; and the covenants and agreements herein set forth to be performed by the Issuer are and shall be for the equal benefit, protection and security of all Owners, all of which shall be of equal rank and -6- B - 10 Ir------- without preference, priority or distinction of any of the Bonds over any other, except as hereinafter provided. (F) The Governing Body is advised that due to the present volatility of the market for tax-exempt public obligations such as the Section 2 . 01 Bonds, it is in the best interest of the Issuer to sell the Section 2 . 01 Bonds by a negotiated sale, allowing the Issuer to enter such market at the most advantageous time, rather than at a specified advertised future date, thereby permitting the Issuer to obtain the best possible price, interest rate and other terms for the Section 2 . 01 Bonds and, accordingly, the Issuer does hereby find and determine that it is in the best financial interest of the Issuer that a negotiated sale of the Section 2 . 01 Bonds be authorized. The Underwriter has offered to purchase the Section 2 . 01 Bonds at the price and upon the terms to 4 be stated in a Bond Purchase Agreement and will file with the Issuer the Underwriter's Disclosure Statement in compliance with Section 218 . 385 (4) , Florida Statutes, as amended. (G) It is necessary and appropriate that the Issuer appoint a registrar and a paying agent for the Bonds, and the institution appointed Registrar by Section 4 . 08 hereof is acceptable to the Issuer; and it appears to the Governing Body that the same is qualified to serve as Registrar for the Bonds in accordance with the terms hereof. 1. 04 Project Authorized. The acquisition, construction and installation of the Project is hereby authorized. -7- B - 11 ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF BONDS 2 . 01 Authorization of Bonds. Subject and pursuant to the provisions of this Instrument, fully registered obligations of the Issuer described in Appendix C hereto are hereby authorized to be issued for the purpose of financing all or a part of the Cost of the Project and are to be registered for initial delivery in the name of Cede & Co. , as Securities Depository Nominee with such interest rates and maturities as shall be approved by the Issuer by subsequent resolution. 2 . 02 Payment of Bonds and Interest. The Bonds shall be payable as to both principal and interest at the principal office of the Registrar in lawful money of the United States of America. The interest payable on each of the Bonds on any Interest Payment Date will be paid by check or draft of the Registrar to the Owner in whose name such Bond shall be registered at the close of business on the date which shall be the fifteenth day (whether or not a business day) next preceding such Interest Payment Date. In the event the interest payable on the Bonds is not punctually paid or duly provided for by the Issuer on such Interest Payment Date, such defaulted interest will be paid to the Owner in whose name such Bonds shall be registered at the close of business on a special record date for the payment of such defaulted interest as established by notice to such Owner, not less than ten (10) days preceding such special record date. -8 11 - B - 12 From and after any maturity date of any of the Bonds or part thereof (deposit of moneys and/or Federal Securities for the payment of the principal and interest on such Bonds or part thereof having been made by the Issuer with the Registrar) , notwithstanding that any of such Bonds shall not have been surrendered for cancellation, no further interest shall accrue upon the principal of such Bonds or such part thereof, no interest shall accrue upon the interest which shall have accrued and shall then be due on such date, and such Bonds or part thereof shall cease to be entitled to any lien, benefit or security under this Instrument, and the Owners shall have no rights in respect of such Bonds or part thereof except to receive payment of such principal and unpaid interest accrued to the maturity date. 2 . 03 Provisions for Redemption. The Section 2 . 01 Bonds shall be redeemable prior to their respective stated dates of maturity only upon such terms and conditions as may be provided in subsequent resolution by the Issuer. Unless waived by any Owner of Bonds to be redeemed, notice of any redemption of Bonds prior to maturity shall be given by the Registrar on behalf of the Issuer by mailing a copy of an official redemption notice by registered or certified mail at least 30 days and not more than 60 days prior to the date fixed for redemption to each Owner of Bonds to be redeemed at the address of such Owner shown on the Bond Register or at such other address as shall be furnished in writing by such Owner to the Registrar. -9- B - 13 Every official notice of redemption shall be dated and shall state: (1) the redemption date, (2) the redemption price, (3) if less than all outstanding Bonds are to be redeemed, the number (and, in the case of a partial redemption of any Bond, the principal amount) of each Bond to be redeemed, (4) that on the redemption date the redemption price will become due and payable upon each such Bond or portion thereof called for redemption, and that interest thereon shall cease to accrue from and after said date, and (5) that such Bonds to be redeemed, whether as a whole or in part, are to be surrendered for payment of the redemption price at the principal office of the Registrar. Prior to any redemption date, the Issuer shall deposit with the Registrar for the benefit of the Owners an amount of money sufficient to pay the redemption price of all the Bonds or portions of Bonds which are to be redeemed on that date. The Registrar shall not be obligated to pay interest or account for or pay over any earnings or benefits it may receive as a result of holding such money, to any Owner, the Issuer or any other Person. Official notice of redemption having been given as aforesaid, the Bonds or portions of Bonds to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the Issuer shall default in the payment of the redemption price) such Bonds or -10- B - 14 portions of Bonds shall cease to bear interest. Upon surrender for redemption in accordance with said notice, such Bonds shall be paid by the Registrar at the redemption price. Each check or other transfer of funds issued by the Registrar for the purpose of the payment of the redemption price of Bonds being redeemed shall bear the CUSIP number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. Installments of interest due on or prior to the redemption date shall be payable as herein provided for payment of interest. Upon surrender for any partial redemption of any Bond, there shall be prepared for the Owner a new Bond or Bonds of the same maturity in the amount of the unpaid principal of such partially redeemed Bond. All Bonds which have been redeemed shall be cancelled and destroyed by the Registrar and shall not be reissued. In addition to the foregoing notice, further notice shall be given by the Bond Registrar as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed. (1) Each further notice of redemption given hereunder shall contain the information required above for an official notice of redemption plus (i) the CUSIP numbers of all Bonds being redeemed; (ii) the date of issue of the Bonds as originally issued; (iii) the rate of interest borne by each Bond being redeemed; (iv) the maturity date of each Bond being redeemed; and (v) any other -11- B - 15 descriptive information needed to identify accurately the Bonds being redeemed. (2) Each further notice of redemption shall be sent at least 35 days before the redemption date by registered or certified mail or overnight delivery service to all registered securities depositories then in the business of holding substantial amounts of obligations of types comprising the Bonds (such depositories now being Depository Trust Company of New York, New York, Midwest Securities Trust Company of Chicago, Illinois, Pacific Securities Depository Trust Company of San Francisco, California, and Philadelphia Depository Trust Company of Philadelphia, Pennsylvania) and to one or more national information services that disseminate notices of redemption of obligations such as the Bonds. 2 . 04 Execution of Bonds. The Bonds shall be executed in the name of the Issuer with the manual or facsimile signature of the Mayor and the corporate seal (or a facsimile thereof) of the Issuer shall be imprinted thereon, attested and countersigned with the manual or facsimile signature of the Clerk or other authorized officer of the Issuer. In case any one or more of the officers who shall have signed or sealed the Bond or whose facsimile signature shall appear thereon shall cease to be such officer of the Issuer before such Bonds have been actually sold such Bonds may nevertheless be sold as herein provided and may be issued as if the person who signed or sealed the Bond had not ceased to hold such office. The Bonds may be signed and sealed on behalf of the Issuer by such person who at the actual time of the execution of the Bond -12- B - 16 shall hold the proper office of the Issuer, although at the date of such Bond such person may not have held such office or may not have been so authorized. The Issuer may adopt and use for such purposes the facsimile signatures of any such persons who shall have held such offices at any time after the date of the adoption of this Instrument, notwithstanding that either or both shall have ceased to hold such office at the time the Bonds shall be actually sold. 2 . 05 Negotiability and Registration. The Bonds shall be and shall have all the qualities and incidents of negotiable instruments under the law merchant and the Uniform Commercial Code of the State of Florida, subject to the provisions for registration and transfer contained in this Instrument and in the Bonds. Each Bond shall be transferable only upon the Bond Register of the Issuer, at the principal office of the Registrar, upon delivery to the Registrar of a written instrument or instruments of transfer in form and with guarantee of signatures satisfactory to the Registrar, duly executed by the Owner of the Bonds to be transferred, or by such Owner's attorney duly authorized in writing, containing such identification information for the transferee as the Registrar shall reasonably require, and the certificate for the Bond or Bonds to be transferred. In all cases of the transfer of any Bond, the Registrar shall enter the transfer of ownership in the Bond Register and deliver in the name of the transferee or transferees a new registered Bond or Bonds, of authorized denominations of the same maturity and interest rate for the aggregate principal amount which -13- B - 17 the Owner is entitled to receive at the earliest practicable time in accordance with the provisions of this Instrument. The Issuer or the Registrar may charge the Owner for every such transfer of Bonds sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such transfer and may require that such charge be paid before any such transfer shall be made or any new Bond shall be delivered. Bonds may be exchanged at the principal office of the Registrar for a like aggregate principal amount of Bonds of the same series, maturity and interest rate in other authorized denominations. The Issuer and the Registrar shall not be required to issue, transfer or exchange any Bonds during the period beginning with the fifteenth day next preceding either any Interest Payment Date or any day on which such Bonds shall have been duly called for redemption in whole or in part and with respect to which the applicable notice of redemption shall have been duly given. New Bonds delivered upon any transfer or exchange shall be valid, limited obligations of the Issuer, evidencing the same debt as the Bonds surrendered, shall be payable solely from the Pledged Funds and shall be entitle& to all of the security and benefits hereof to the same extent as the Bonds surrendered. The Issuer and the Registrar may treat the Owner of any Bond, whether or not such Bond shall be overdue, as the absolute owner thereof for all purposes, and any notice to the contrary shall not be binding upon the Issuer or the Registrar. -14- B - 18 2 . 06 Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall become mutilated, or be destroyed, stolen or lost, the Issuer may in its discretion issue and deliver a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond, upon surrender to and cancellation of such mutilated Bond by the Registrar, or in lieu of and substitution for the Bond destroyed, stolen or lost, and upon the Owner furnishing to the Issuer satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer may prescribe and paying such expenses as the Issuer may incur. If any such Bonds shall have matured or be about to mature, instead of issuing a substitute Bond the Issuer may pay the same, upon being indemnified as aforesaid, and if such Bond be lost, stolen or destroyed, without surrender thereof. Any such duplicate Bonds issued pursuant to this section shall constitute original, additional contractual obligations on the part of the Issuer whether or not the lost, stolen or destroyed Bonds be at any time found by anyone, and such duplicate Bonds shall be entitled to equal and proportionate benefits and rights as to lien on and source and security for payment from the Pledged Funds to the same extent as all other Bonds issued hereunder. 2 . 07 Form of Bonds. The text of each series of the Bonds shall be in substantially the form therefor provided in Appendix G hereto, with only such omissions, insertions and variations as may be necessary and/or desirable (which necessity -15- B - 19 and/or desirability shall be presumed by the Issuer's delivery of such Bonds to the purchaser or purchasers thereof) . ARTICLE III COVENANTS, SPECIAL FUNDS AND APPLICATION THEREOF 3 . 01 Bonds Not to Be General Obligations of Issuer. Neither the Bonds nor the interest thereon shall be or constitute general obligations or indebtedness of the Issuer as "bonds" within the meaning of Article VII, Section 12 of the Constitution of Florida, but shall be payable solely from and secured by the Pledged Funds as herein provided. No Owner shall ever have the right to compel the exercise of any ad valorem taxing power to pay such Bond or be entitled to payment of such Bond from any moneys of the Issuer, except from the Pledged Funds in the manner provided herein. 3 . 02 Security for Bonds. The payment of the principal of and interest on the Bonds shall be secured forthwith equally and ratably by a lien upon the Pledged Funds. The Issuer does hereby irrevocably covenant to budget and appropriate the Pledged Funds on an annual basis for the payment of the principal of and interest on the Bonds and to make the payment into the Sinking Fund at the times provided of the sums required to secure to the Owners thereof the payment of the principal of, premium, if any, and interest on the Bonds as the same shall become due. The portion of the Issuer's non-ad valorem revenues which is not appropriated for the -16- B - 20 } repayment of the Bonds nor placed in the Revenue Fund is not pledged as security . or the Bonds. 3 . 03 Application of Section 2 . 01 Bond Proceeds. The Issuer will establish with an Authorized Depository two separate accounts (known as the "Ocoee City Hall Project Account" and the "Ocoee Police Station Project Account") , into which shall be deposited the proceeds from the sale of the Section 2 . 01 Bonds (except accrued interest, if any, which shall be deposited in the Sinking Fund) and the additional funds, if any, required to assure payment in full of the Cost of the Project. There shall exist no lien upon or pledge of funds in the two Project Accounts in favor of the Owners, and the Owners shall have no duty or obligation to see that the proceeds of the Section 2 . 01 Bonds shall be applied as herein specified or that the moneys in such Project Accounts shall be expended in the manner provided in this section. Moneys in the two Project Accounts shall be expended only for the Cost of the Project, with the moneys in the Ocoee Police Station Project Account to be used only for that portion of the wei Project relating to the police station. The moneys shall be continuously secured by such Authorized Depository in the manner prescribed by the laws of the State of Florida relating to the securing of funds of the Issuer. The Issuer may direct the Authorized Depository to invest in Authorized Investments all or any portion of such funds on deposit in the Project Accounts which shall not be needed immediately to pay items of the Cost of the -17- B - 21 Project. The earnings from any such investment shall be deposited in the respective Project Accounts. Provided, however, anything herein to the contrary notwithstanding, no use will be made of the proceeds of the Section 2 .01 Bonds which, if such use were reasonably expected on the date of issuance of the Section 2 . 01 Bonds, would cause the same to be "arbitrage bonds" within the meaning of the Code. The Issuer will at all times while the Section 2 . 01 Bonds and the interest thereon shall remain outstanding and unpaid comply with the requirements of Section 148 of the Code. When the construction of the Project has been completed and all Costs thereof have been paid in full, all funds remaining in the Project Accounts shall be retained in the Project Accounts and promptly expended by the Issuer to pay all or part of the cost of any other governmental capital project or projects with respect to which the Issuer shall obtain an opinion of nationally recognized bond counsel that such expenditure will not cause the interest on any of the Section 2 . 01 Bonds to be includable in the gross income of the Owners thereof, or applied, to the extent possible, to the purchase of Section 2 . 01 Bonds which may be available in the open market or, if not available, to the redemption of Section 2 . 01 Bonds on the earliest optional redemption date, in the manner provided in Section 2 . 03 hereof, whereupon any balance thereof shall be deposited in the Revenue Fund and the Project Accounts shall be closed. -18- B - 22 3 . 04 Covenants of the Issuer. So long as any of the principal of or premium, if any, or interest on any of the Bonds shall be outstanding and unpaid, or until provision for payment thereof shall have been made within the meaning of Section 4 ..05 hereof, the Issuer covenants with the Owners as follows: (A) Revenue Fund. The Issuer covenants and agrees to establish with an Authorized Depository and maintain a special account into which the Issuer shall deposit promptly on March 1 and September 1 of each year Revenues in amounts which will be sufficient to pay the next succeeding interest and principal payments (and redemption premium, if any) due on the Bonds. The Revenue Fund shall be held by the Issuer separate and apart from all other funds of the Issuer and expended and applied by the Issuer only in the manner specified in this section. (B) Sinking Fund. The Issuer covenants and agrees to establish with an Authorized Depository a special fund to be known as the "Sinking Fund" and used exclusively by the Issuer for the purpose of receiving and holding the accrued interest to be deposited therein from Bond proceeds, any sum required by Appendix F hereto to be deposited from Bond proceeds (or any other source specified in Appendix F hereto) and the moneys to be deposited therein from the Revenue Fund pursuant to this subsection and to pay therefrom (i) all interest on the Bonds as the same shall come due and (ii) the principal of the Bonds at the respective maturity dates thereof. -19- B - 19-B - 23 On or before March 5 and September 5, the Issuer shall withdraw from the Revenue Fund and deposit to the credit of the Sinking Fund such sums on deposit in the Revenue Fund as shall be necessary to make the amount on deposit in the Sinking Fund sufficient to pay the next succeeding interest and principal payments (and redemption premium, if any) due on the Bonds, and shall deposit any additional amount specified in Appendix F hereto. After such deposits shall have been made from the Revenue Fund to the Sinking Fund to the extent required, the balance of the moneys on deposit in the Revenue Fund, if any, and any interest or other earnings which may thereafter, be derived by the Issuer from the investment of Sinking Fund moneys may be withdrawn by the Issuer, from the Revenue Fund and the Sinking Fund, respectively, whereupon the lien in favor of the Bonds upon such moneys so withdrawn shall be and is hereby released, and such moneys and earnings so withdrawn may be used by the Issuer for the purchase of Bonds, or for the redemption of Bonds which shall then be subject to redemption, or for any other lawful public purpose. (C) Trust Funds. The Revenue Fund, the Sinking Fund and all other funds and accounts which may be established pursuant to Appendix F hereto shall constitute trust funds for the purposes provided herein for such funds. All moneys on deposit therein, except those invested as hereinafter provided, shall be continuously secured in the same manner as deposits of funds of the Issuer are required to be secured by the laws of the State of Florida. There is hereby created a lien upon such funds in favor -20- B - 24 of the Owners until the moneys deposited therein shall have been applied in accordance with this Instrument. Moneys on deposit to the credit of the Sinking Fund, except as may be provided in Appendix F hereto, may be invested in Authorized Investments which shall mature not later than the date on which such moneys shall be needed to pay the principal of and interest on the Bonds in the manner herein provided. The securities so purchased as an investment of funds shall be deemed at all times to be a part of the Sinking Fund, and any loss resulting from such investment shall be charged to the Sinking Fund and any interest accruing on such investment or any other profit realized therefrom shall be deposited in the Sinking Fund. Except as may be expressly provided in Appendix F hereto, the cash required to be accounted for in any of the funds and accounts created hereunder may be deposited in a single bank account, and the moneys allocated to such funds and accounts may be invested in a common investment pool, provided that adequate accounting records are maintained to reflect and control the restricted allocation of the cash on deposit therein and such investments for the purposes of such funds and accounts as herein provided. The designation and establishment of the funds and accounts in and by this Instrument shall not be construed to require the establishment of any completely independent, self-balancing fund as such term is commonly defined and used in governmental accounting, but rather is intended solely to -21- B - 25 constitute an earmarking of certain revenues for certain purposes and to create a lien upon and pledge thereof in favor of the Bonds and establish certain priorities for application of such revenues as herein provided. (D) Issuance of Additional Debt. The Issuer may issue Additional Debt payable from its non-ad valorem revenues as prescribed in Appendix B hereof. Any resolution authorizing the issuance of Additional Debt may provide that any of the covenants herein contained will not be applicable to such Additional Debt, provided that such provisions shall not adversely affect the rights of any Bonds which shall then be outstanding. (E) Events of Default and Remedies. If one or more of the following events, herein called "Events of Default, " shall happen, that is to say, in case: (1) default shall be made in the payment of the principal or redemption price of any Bond when the same shall become due and payable, either at maturity or by proceedings for redemption or otherwise; or (2) default shall be made in the payment of any installment of interest on any Bond when and as such installment of interest shall become due and payable; or (3) the Issuer shall (1) admit in writing its inability to pay its debts generally as they become due, (2) file a petition in bankruptcy or take advantage of any insolvency act, (3) make an assignment for the benefit of its creditors, (4) consent to the -22- B - 26 appointment of a receiver of itself or of the whole or any substantial part of its property, or (5) be adjudicated as bankrupt; or (4) a court of competent jurisdiction shall enter an order, judgment or decree appointing a receiver of the Pledged Funds or any part thereof, or of the whole or any substantial part of the Issuer's property, or approving a petition seeking reorganization of the Issuer under the federal bankruptcy laws or any other applicable law or statute of the United States of America or the State of Florida pertaining to bankruptcy or insolvency, and such order, judgment or decree shall not be vacated or set aside or stayed within 60 days from the date of the entry thereof; or (5) under the provisions of any other law for the relief or aid of debtors, any court of competent jurisdiction shall assume custody or control of the Pledged Funds, or any part thereof, or of the Issuer or of the whole or any substantial part of the Issuer's property, and such custody or control shall not be terminated or stayed within 60 days from the date of assumption of such custody or control; or (6) the Issuer shall default in the due and punctual performance of any other of the covenants, conditions, agreements and provisions contained in the Bonds or in this Instrument on the part of the Issuer to be performed, and such default shall continue for 30 days after written notice specifying such default and requiring the same to be remedied shall have been given the Issuer -23- B - 27 by the Owners of not less than 25% in principal amount of the Bonds then outstanding; then in each and every such case any Owner of the Bonds affected by the Event of Default and then outstanding hereunder or an agent or trustee therefor may proceed to protect and enforce its rights and the rights of the Owners by a suit, action or special proceeding in equity or at law, by mandamus or otherwise, either for the specific performance of any covenant or agreement contained herein or in aid or execution of any power herein granted or for any enforcement of any proper legal or equitable remedy (including the appointment of a receiver) as said Owner or Owners shall deem most effectual to protect and enforce the rights aforesaid. No remedy herein conferred upon or reserved to the Owners is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. No delay or omission of any Owner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default, or an acquiescence therein; and every power and remedy given by this section to the Owners may be exercised from time to time, and as often as may be deemed expedient. Nothing herein, however, shall be construed to waive any venue privileges of the Issuer or to grant to any Owner any right -24- B - 28 to or lien on the Project or any part thereof or on any other property or income of the Issuer except the Pledged Funds. If an Event of Default shall happen and shall not have been remedied, the Issuer or a receiver appointed for the purpose shall apply all Pledged Funds as follows and in the following order: (1) to the payment of the reasonable and proper charges, expenses and liabilities of the receiver, the Registrar and the paying agents hereunder; (2) to the payment of the interest and principal or redemption price then due on the Bonds, as follows: Unless the principal of all the Bonds shall have become due and payable, all such moneys shall be applied first: to the payment to the Persons entitled thereto of all installments of interest then due, in the order of the maturity of such installments (with interest on defaulted installments of interest at the rate or rates borne by the Bonds with respect to which such interest is due to the extent permitted by law) , and, if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amount due on such installment, to the Persons entitled thereto, without any discrimination or preference; -25- B - 29 second: to the payment to the Persons entitled thereto of the unpaid principal of any of the Bonds which shall have become due at maturity or upon mandatory redemption prior to maturity (other than Bonds called for redemption for the payment of which moneys are held pursuant to the provisions of Section 4 . 05 of this Instrument) , in the order of their due dates, with interest upon such Bonds at the rate or rates borne by such Bonds, from the respective dates upon which they became due, and, if the amount available shall not be sufficient to pay in full Bonds due on any particular date, together with such interest, then to the payment first of such interest, ratably according to the amount of such interest due on such dates, and then to the payment of such principal, ratably according to the amount of such principal due on such date, to the Persons entitled thereto without any discrimination or preference; and third: to the payment of the redemption premium on and the principal of any Bonds called for optional redemption pursuant to the provisions of this Instrument. If the principal of all the Bonds shall have become due and payable, all such moneys shall be applied to the payment of the -26- B - 30 principal and interest then due and unpaid upon the Bonds, with interest thereon as aforesaid, without preference or priority of principal over interest or of interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bonds, ratably, according to the amounts due respectively for principal and interest, to the Persons entitled thereto without any discrimination or preference. (F) Records and Audits. The Issuer shall keep specific books, accounts and records of the Pledged Funds and the Cost of the Project and any Owner shall have the right, at all reasonable times, to inspect such books and records. So long as any of the Bonds shall be outstanding, the Issuer will furnish on or before one hundred eighty (180) days after the close of each Fiscal Year, to any Owner who shall request the same in writing, copies of an annual audit report prepared by an independent certified public accountant or an auditing official of the State of Florida, covering for the preceding Fiscal Year, in reasonable detail, the financial condition of the Issuer, receipts of the Revenues and all transactions in the Revenue Fund and the Sinking Fund. (G) Fidelity Bond. The Issuer will require each employee who may have possession of any Pledged Funds to be covered by a fidelity bond written by a responsible indemnity company in an amount fully adequate to protect the Issuer from loss. (H) Creation of Superior Liens. The Issuer covenants that it will not issue any other notes, bonds, certificates of -27- B - 31 obligations of any kind or nature or create or cause or permit to be created any debt, lien, pledge, assignment or encumbrance or charge payable from or enjoying a lien upon the Pledged Funds hereunder ranking prior and superior to the lien created by this Instrument for the benefit of the Bonds. The Issuer reserves the right to pledge any and all of its revenues, which have not been pledged to the Section 2 . 01 Bonds hereunder, to Additional Debt upon compliance with Appendix B hereto and reserves the right to issue debt which is not defined hereunder as Additional Debt. (I) Compliance with Code. The Issuer covenants that it will not knowingly make any investments or acquiesce in the making of any investments by any depository pursuant to or under the provisions of this Instrument which could cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code. The Issuer covenants and agrees that it will take any reasonable action required to be taken pursuant to the nonarbitrage certificate or instructions from bond counsel, whether delivered in connection with or subsequent to the issuance and sale of the Bonds, in order to comply with all provisions of the Code compliance with which is required to maintain the tax-exempt status of the interest payable on the Bonds. -28- B - 32 ARTICLE IV MISCELLANEOUS PROVISIONS 4 . 01 General Authority. The members of the Governing Body and the Issuer's officers, attorneys and other agents and employees are hereby authorized to do all acts and things required of them by this Instrument or desirable or consistent with the requirements hereof for the full, punctual and complete performance of all of the terms, covenants and agreements contained in the Bonds and this Instrument, and they are hereby authorized to execute and deliver all documents which shall be reasonably required by bond counsel or the Underwriter to effectuate the sale of the Section 2 . 01 Bonds to the Underwriter. 4 . 02 No Personal Liability. No representation, statement, covenant, warranty, stipulation, obligation or agreement herein contained, or contained in any of the Bonds, or in any certificate or other instrument to be executed on behalf of the Issuer in connection with the issuance of any of the Bonds, shall be deemed to be a representation, statement, covenant, warranty, stipulation, obligation or agreement of any member of the Governing Body, officer, employee or agent of the Issuer in his or her individual capacity, and none of the foregoing persons nor any officer of the Issuer executing any of the Bonds, or any certificate or other instrument to be executed in connection with the issuance of any of the Bonds, shall 'De liable personally thereon or be subject to any personal liability or accountability by reason of the execution or delivery thereof. -29- B - 33 4 . 03 No Third Party Beneficiaries. Except as otherwise expressly provided herein or in the Bonds, nothing in this Instrument, or in the Bonds, expressed or implied, is intended or shall be construed to confer upon any Person other than the Issuer and the Owners any right, remedy or claim, legal or equitable, under and by reason of this Instrument or any provision hereof, or of the Bonds, all provision hereof and thereof being intended to be and being for the sole and exclusive benefit of the Issuer and the Persons who shall from time to time be the Owners. 4 . 04 Compliance with Chapter 218, Part III, Florida Statutes. The Issuer hereby approves and authorizes bond counsel to complete and file with the Division of Bond Finance, Department of General Services of the State of Florida, an advance notice of the impending sale of the Bonds, and to perform any other acts as may be necessary to comply with Chapter 218, Part III, Florida Statutes, as amended. 4 . 05 Defeasance. If, at any time, the Issuer shall have paid, or shall have made provision for payment of, the principal redemption premiums, if any, and interest with respect to any of the Bonds, then, and in that event, the pledge of and lien on the Pledged Funds in favor of the Owners of such Bonds shall be no longer in effect. For purposes of the preceding sentence, deposit by the Issuer of Federal Securities (including obligations issued or held in book-entry form on the books of the Department of Treasury) , none of which permit redemption prior to maturity at the option of the obligor, in irrevocable trust with a banking -30- B - 30-B - 34 institution or trust company, for the sole benefit of such Owners, in respect to which obligations the principal and interest received will be sufficient to make timely payment of the principal of and interest and redemption premiums, if any, on such Bonds, shall be considered "provision for payment. " Nothing in this section shall be deemed to require the Issuer to call any Bonds for redemption prior to maturity pursuant to any applicable optional redemption provisions, or to impair in any way the discretion of the Issuer in determining whether or not to exercise any such option for early redemption. 4 . 06 Modification or Amendment. Any modification or amendment of this Instrument or of any resolution amendatory hereof or supplemental hereto may be made with the consent in writing of the provider of municipal bond insurance insuring all of the Bonds then outstanding which shall be materially and adversely affected by such modification or amendment, if as a result of which insurance such Bonds shall be rated in the highest rating category by either Moody's Investors Service or Standard & Poor's Corporation; or if such Bonds shall not be so insured or such insurance provider shall be in default or bankrupt, with the consent in writing of the Owners of fifty-one per centum (51%) or more in principal amount of such Bonds; provided, however, that no such modification or amendment shall permit a change in the maturity of such Bonds, or a reduction in the rate of interest thereon or in the amount of the principal obligation thereof, or affecting the promise of the Issuer to pay the principal of and -31- B - 35 interest on such Bonds as the same shall become due from the Pledged Funds, or reduce the percentage of such Bonds the Owners of which are required to consent to any such modification or amendment without the consent of the Owners of one hundred per centum (100%) of such Bonds. This Instrument and any resolution amendatory hereof or supplemental hereto may be amended, to the extent that the amendment shall not materially and adversely affect any of the Bonds, without the consent of such insurance provider or any of the Owners for any of the following purposes: (1) To cure any ambiguity or formal defect or omission or to correct any inconsistent provisions in this Instrument, as supplemented, or to clarify any matters or questions arising hereunder. (2) To grant to or confer upon the Owners any additional rights, remedies, powers, authority or security that may lawfully be granted to or conferred upon the Owners. (3) To add to the conditions, limitations and restrictions on the issuance of Bonds under the provisions of this Instrument other conditions, limitations and restrictions thereafter to be observed. (4) To add to the covenants and agreements of the Issuer in this Instrument other covenants and agreements thereafter to be observed by the Issuer or to surrender any right or power herein reserved to or conferred upon the Issuer. -32- B - 36 (5) To specify and determine any matters and things relative to the Bonds which are not contrary to or inconsistent with this Instrument as theretofore in effect. 4 . 07 Sale of Section 2 . 01 Bonds and Distribution of Preliminary Official Statement. The Section 2 . 01 Bonds shall be sold and awarded to the Underwriter at the price and upon the terms and conditions to be stated in the Bond Purchase Agreement. The Issuer shall assist the Underwriter in complying with Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934 , as amended, and hereby authorizes the distribution of the Preliminary Official Statement by the Underwriter in connection with the offering of the Bonds. 4 . 08 Registrar and Paying Agent. Citizens and Southern Trust Company (Florida) , National Association, Fort Lauderdale, Florida, is hereby appointed as Registrar, to serve as registrar and paying agent for the Bonds. 4 . 09 Additional Provisions. Any additional provisions specified in Appendix F hereto are hereby adopted in like manner as though the same were set out in their entirety in this place. 4 . 10 Severability of Invalid Provisions. If any one or more of the covenants, agreements or provisions herein contained shall be held contrary to any express provision of law or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separable from the remaining -33- B - 37 covenants, agreements or provisions and shall in no way affect the validity of any of the other provisions hereof or of the Bonds. 4 . 11 Repeal of Inconsistent Resolutions. All resolutions or parts thereof in conflict herewith are hereby repealed to the extent of such conflict. 4 . 12 Table of Contents and Headings not Part Hereof. The Table of Contents preceding the body of this Instrument and the headings preceding the several articles and sections hereof shall be solely for convenience of reference and shall not constitute a part of this Instrument or affect its meaning, construction or effect. 4 . 13 Effective Date. This Instrument shall take effect immediately upon its passage and adoption. 4 . 14 Adoption at Public Hearing. This Resolution has been adopted at an advertised public hearing held in accordance with and pursuant to the provisions of the Charter of the City of Ocoee. PASSED AND ADOPTED IN PUBLIC SESSION of the City Commission of the City of Ocoee, Florida, this 5th day of March, A.D. , 1991. APPROVED this 5th day of March , A.D. , 1991, at 7:55 o'clock p.m. AIP 41117d 7/ er Dabbs, Jr. , 9Ak r -34- B - 38 FILED in the Office of the City Clerk this S day of March, 1991. 1 Je Grafton, C. Clerk Public Hearing Advertised February 26, , 1991 FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY BY THE CITY OF OCOEE, FLORIDA COMMISSION AT A MEETING APPROVED AS TO FORM A D LEGALITY HELD ON March 5 THIS 5'h DAY OF /Li raN , 1991 UNDER AGENDA ITEM NO. 1991. V A FOLEY & LA DNER BY: ej 110e1V4V City Attorney c:/wp51/docs/ocoee/reso2 -35- B - 39 APPENDIX A ADDITIONAL DEFINITIONS "Act" shall mean Chapter 166, Part III, Florida Statutes (1989) . "Balloon Long-Term Debt" means (i) indebtedness 25% or more of the principal payments of which are due in a single year and (ii) indebtedness 25% or more of the principal of which may, at the option of the holder or registered owner thereof, be redeemed at one time, which portion of the principal is not required by the documents pursuant to which such indebtedness is issued to be amortized by redemption prior to such date. "Clerk" shall mean the Clerk of the Issuer. "Designated Officer" shall mean the "Governing Body" shall mean the City Commission of the Issuer. "Issuer" shall mean the City of Ocoee, a political subdivision created and existing under and by virtue of the laws of the State of Florida. "Project" shall mean the acquisition, construction, expansion, renovation, installation and equipping of the Issuer's City Hall and Police Station. Appendix A - Page 1 B - 40 APPENDIX B ADDITIONAL DEBT Additional Debt may be issued by the Issuer only upon compliance with the following conditions, to wit, that: (1) There shall have been obtained and filed with the Issuer a statement provided by the City's Finance Director: (a) stating that the books and records of the Issuer relating to the Issuer's receipt of all of its non-ad valorem revenues have been examined by such officer; (b) setting forth the amount of all of its non-ad valorem revenues for the Fiscal Year immediately preceding the date of delivery of such proposed Additional Debt with respect to which such statement is made; and (c) stating that such amount of all of its non-ad valorem revenues equals at least 1.75 times the Maximum Bond Service Requirement for all Bonds and any Additional Debt then outstanding, together with the proposed Additional Debt which respect to which such statement is made; and (2) The Issuer shall have cured any default in its performance of all of the covenants and obligations assumed by the Issuer hereunder, and all funds and accounts established under this Instrument shall be at levels at least equal to the respective levels therefor required hereby; provided, however, that a portion of the proceeds of the proposed Additional Debt may be used to provide moneys for this purpose. The amount of the non-ad valorem revenues as stated by the officer for compliance with clause (b) of paragraph (1) of this appendix and for the purpose of calculating the required coverage Appendix B - Page 1 B - 41 for clause (c) of such paragraph shall be adjusted to include any amount by which the City Commission of the Issuer may have been increased by declaration of the Issuer made by resolution of the Commission adopted anytime after the commencement of such Fiscal Year and prior to the date such statement shall be made. Any resolution authorizing the issuance of Additional Debt may provide that any of the covenants herein contained will not be applicable to such Additional Debt, provided that such provisions shall not adversely affect the rights of any Bonds which shall then be outstanding. Appendix B - Page 2 B - 42 APPENDIX C DESCRIPTION OF SECTION 2 . 01 BONDS The Bonds are fully registered obligations issued in the aggregate principal amount of $ maturing and subject to redemption as set forth in subsequent resolution of the Issuer. 4 Appendix C - Page 1 B - 43 APPENDIX D REVENUES Revenues are that portion of the Issuer's non-ad valorem revenues which non-ad valorem revenues include, but are not limited to, license and permit fees, guaranteed entitlement and the half- cent sales tax, charges for services, fines and forfeitures, franchise fees, and utility taxes, which are budgeted by the Issuer on an annual basis to repay the Bonds. Appendix D - Page 1 B - 44 APPENDIX E [INTENTIONALLY OMITTED] 4 1.7 Appendix E - Page 1 B - 45 APPENDIX F ADDITIONAL FINDINGS/ADDITIONAL PROVISIONS (H) The Issuer desires to qualify the Section 2 . 01 Bonds for the small governmental units exception to the arbitrage rebate requirements imposed by Section 148 (f) on the Code upon tax-exempt w, obligations such as the Section 2 . 01 Bonds issued after September 1, 1986. The Issuer does hereby find and determine that it is a governmental unit with general taxing powers, that the Section 2 . 01 bonds are not private activity bonds as defined in Section 141 of the Code, that at least 95 percent of the net proceeds of the Section 2 . 01 bonds (i.e. , the proceeds of the Section 2 . 01 Bonds reduced by amounts in a reasonably required reserve or replacement fund, if any) will be used for local governmental activities of the Issuer, and that the aggregate face amount of all tax-exempt obligations, other than private activity bonds (as defined in Section 141 of the Code) , including the Section 2 . 01 bonds, issued by or on behalf of the Issuer (and all subordinate entities thereof) during the 1991 calendar year is not reasonably expected to exceed $5, 000, 000. (I) The Issuer desires to qualify the Section 2 . 01 Bonds for the exception contained in Section 265 (b) (3) of the Code to the provisions of Section 265 (b) of the Code which deny financial institutions any deduction for interest expense allocable to tax- exempt obligations acquired after August 7 , 1986, and to designate the Section 2 . 01 Bonds for the purpose of qualifying for such exception. The Issuer does hereby find and determine that the Appendix F - Page 1 B - 46 aggregate face amount of all qualified tax-exempt obligations (excluding private activity bonds, as defined in Section 141 of the Code, other than qualified 501 (c) (3) bonds, as defined in Section 145 of the Code) , including the Section 2 . 01 Bonds, issued by or on behalf of the Issuer (and all subordinate entities thereof) during the 1991 calendar year is not expected to exceed $10, 000, 000 and that as of the date hereof no tax-exempt obligations issued or authorized to be issued by or on behalf of the Issuer (and all subordinate entities thereof) , other than the Section 2 . 01 Bonds, have been designated by the Issuer for the purpose of qualifying for such exception. Appendix F - Page 2 B - 47 APPENDIX G FORM OF BOND REGISTERED April 1, 1991 ra` UNITED STATES OF AMERICA STATE OF FLORIDA CITY OF OCOEE CAPITAL IMPROVEMENT REVENUE BOND, SERIES 1991 REGISTERED OWNER: Cede & Co. PRINCIPAL AMOUNT: $ MATURITY DATE: October 1, CUSIP: FOR VALUE RECEIVED, the City of Ocoee, a political subdivision created and existing under and by virtue of the laws of the State of Florida (the "Issuer") , hereby promises to pay, solely from the special funds hereinafter described, to the Registered Owner identified above, or registered assigns as hereinafter provided, the Principal Amount identified above in installments in the amounts and on the installment payment dates hereinafter provided, and interest on the unpaid balance of such Principal Amount from the date identified above or from the most recent Interest Payment Date (hereinafter defined) to which interest has been paid, at the rate of % per annum, on April 1 and October 1 of each year commencing October 1, 1991 (the "Interest Payment Appendix G - Page 1 B - 48 Dates") , until such Principal Amount shall have been paid, except as the provisions hereinafter set forth with respect to redemption prior to maturity may be and become applicable hereto. The principal of this bond is payable October 1 for the year shown above. Such Principal Amount and interest and the premium (if any) on this bond are payable in any coin or currency of the United States of America which, on the respective dates of payment thereof, shall be legal tender for the payment of public and private debts, at the office of the Bond Registrar hereinafter identified, located in , Florida, or at the principal corporate trust office of any successor Bond Registrar duly appointed by the Issuer, notice of which appointment (unless waived) shall be promptly given in the manner hereinafter provided for the giving of notice of redemption. Payment of each installment of interest shall be made to the person in whose name this bond shall be registered on the registration books of the Issuer maintained by the Bond Registrar at the close of business on the date which shall be the fifteenth day (whether or not a business day) next preceding the Interest Payment Date for such installment and shall be paid by a check or draft of the Bond Registrar mailed to such registered owner at the address appearing on such registration books or at such other address as may be furnished in writing by such registered owner to the Bond Registrar. In the event interest payable on this bond is not punctually paid or duly provided for by the Issuer on such Interest Appendix G - Page 2 B - 49 Payment Date, payment of each installment of such defaulted interest shall be made to the person in whose name this bond shall be registered at the close of business on a special record date for the payment of such defaulted interest as established by notice to the registered owner hereof, not less than ten (10) days preceding such special record date. This bond is one of an authorized series of Bonds issued in the aggregate principal amount of $ (the "Bonds") issued to finance the cost of the acquisition, construction, expansion, renovation, installation and equipping of the Issuer's City Hall and Police Station (the "Project") , under the authority of and in full compliance with the Constitution and statutes of the State of Florida, particularly Chapter 166, Part II, Florida Statutes, as amended, and Resolution No. duly adopted by the Issuer on March 5, 1991, as amended and supplemented (the "Resolution") , and is subject to all the terms and conditions of the Resolution. This bond and the interest and any premium hereon are payable solely from and secured by a prior lien upon and a pledge of all of the moneys of the Issuer which are deposited with an Authorized Depository (as defined in the Resolution) into the Revenue Fund which are a portion of the moneys allocated and paid to the Issuer as non-ad valorem revenues, and all moneys on deposit to the credit of the Sinking Fund established pursuant to the Resolution and the interest and earnings to be derived by the Issuer from the investment thereof (the "Pledged Funds") , all in Appendix G - Page 3 B - 50 the manner described in the Resolution. No specific revenue sources have been pledged for the payment of the Bonds, however, the Issuer has covenanted to budget and appropriate annually from its non-ad valorem revenues, the amounts necessary to pay interest on, principal when due, and redemption premium, if any, for the Bonds. Neither this bond nor the interest or any premium hereon shall constitute a general indebtedness of the Issuer within the meaning of any constitutional or statutory provision or limitation, and neither the faith nor credit of the Issuer is pledged for their payment. It is expressly agreed by the owner of this bond that such owner shall never have the right to require or compel the exercise of the ad valorem taxing power of the Issuer to the payment of such principal, interest and premium, if any , or the payment of any other payments provided for in the Resolution. This bond and the obligation evidenced hereby shall not constitute a lien upon the Project or any other property owned by or situated within the territorial limits of the Issuer, but shall constitute a lien only upon and shall be payable solely from the Pledged Funds in the manner above recited. The Bonds maturing in the years 1992 to 1999, both inclusive, are not redeemable prior to their stated dates of maturity. The Bonds maturing on or after October 1, 2000 are redeemable prior to their stated dates of maturity, at the option of the Issuer as a whole, or in part, by maturities to be selected by the Issuer and by lot within a maturity if less than a full maturity, on October 1, 1999 or on any Interest Payment Date Appendix G - Page 4 B - 51 thereafter, at a redemption price (expressed as a percentage of the principal amount thereof as set forth in the table below) together with accrued interest to the redemption date, if redeemed in the following periods: Redemption Period Both Dates Inclusive Redemption Price October 1, 1999 to September 30, 2000 102% October 1, 2000 to September 30, 2001 101 October 1, 2001 and thereafter 100 Notice of redemption, unless waived, is to be given by the Registrar by mailing an official redemption notice by registered or certified mail at least 30 days and not more than 60 days prior to the date fixed for redemption to the registered owners of the Bonds to be redeemed at such owners' addresses shown on the registration books maintained by the Bond Registrar or at such other addresses as shall be furnished in writing by such registered owners to the Bond Registrar. Notice of redemption having been given as aforesaid, the Bonds or portions of the Bonds to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date (unless the Issuer shall default in the payment of the redemption pricey such Bonds or portions of Bonds shall cease to bear interest. This bond is transferable only upon the registration books of , , as registrar, or such other registrar as the Issuer shall hereafter duly appoint (the "Bond Registrar") , but only in the manner, Appendix G - Page 5 B - 52 subject to the limitations and upon payment of the charges provided in the Resolution, and upon surrender of this bond to the Bond Registrar, with an instrument or instruments of transfer in form and with guaranty of signature satisfactory to the Bond Registrar, duly executed by the registered owner hereof, or by such owner's attorney duly authorized in writing and containing satisfactory information identifying the transferee. In all cases of the transfer of this bond, the Bond Registrar shall enter the transfer of ownership in such registration books and shall deliver in the name of the transferee or transferees a new Bond or Bonds of authorized denomination or denominations and of the same maturity, interest rate and aggregate principal amount, at the earliest practicable time. Prior to every such transfer the Bond Registrar shall be entitled to receive from the owner of this bond a sum sufficient only to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such transfer. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of this bond, exist, have happened and have been performed, in regular and due form and time as required by the Constitution and laws of the State of Florida applicable hereto, and that the issuance of the Bonds does not violate any constitutional, statutory or charter limitations or provisions. Appendix G - Page 6 B - 53 This bond is and has all the qualities and incidents of a negotiable instrument under the law merchant and the Uniform Commercial Code of the State of Florida. IN WITNESS WHEREOF, the City of Ocoee, Florida, has issued this bond and has caused the same to be signed with the signature of the Mayor of the City and attested and countersigned with the signature of the Clerk of the City, and its corporate seal to be imprinted hereon, all as of the date first above mentioned. THE CITY OF OCOEE, FLORIDA [SEAL] By: Its: ATTESTED AND COUNTERSIGNED: City Clerk Appendix G - Page 7 B - 54 CERTIFICATE OF AUTHENTICATION This bond is one of the Bonds of the issue described in the within-mentioned Resolution. Registrar, as Authenticating Agent By: Authorized Officer DATE OF AUTHENTICATION: ASSIGNMENT AND TRANSFER FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto the within bond and does hereby irrevocably constitute and appoint as attorneys to register the transfer of the said bond on the books kept for registration thereof with full power of substitution in the premises. Dated: NOTICE: The signature to this Signature Guaranteed: assignment must correspond with the name of the Registered Holder as it appears upon the face of the within Bond in NOTICE: Signature(s) must be every particular, without alter- guaranteed by a member of the ation or enlargement or any New York Stock Exchange or a change whatever and the Social commercial bank or trust Security or other identifying company. number of such assignee must be supplied. Appendix G - Page 8 B - 55 t [This page intentionally left blank] APPENDIX C COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF OCOEE, FLORIDA FOR THE YEAR ENDED SEPTEMBER 30, 1990 Prepared by: Finance Department COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE CITY OF OCOEE, FLORIDA FOR THE YEAR ENDED SEPTEMBER 30, 1990 TABLE OF CONTENTS PAGE NO. FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT 1 GENERAL PURPOSE FINANCIAL STATEMENTS (COMBINED STATEMENTS - OVERVIEW) COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS 1-4 COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -- ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS 5-6 COMBINED STATEMENT OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL - GENERAL FUND 7 COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS/FUND BALANCE - ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS 8 COMBINED STATEMENT OF CHANGES IN FINANCIAL POSITION - ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS 9-10 NOTES TO FINANCIAL STATEMENTS 11-41 CDIRMIT AVIS AUTERIA & COMPANY, P.A. CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORSREPORT Honorable Mayor and City Commissioners City of Ocoee, Florida We have audited the general purpose financial statements of the City of Ocoee, Florida, as of and for the year ended September 30, 1990, as listed in the table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted audit- ing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general pur- pose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Ocoee, Florida, at September 30, 1990, and the results of its operations and the changes in financial position of its proprietary and similar fund types for the year then ended in conformity with generally accepted accounting principles. Da,vt;0, /u-thuua.) eontphuaIP, . McDIRMIT, DAVIS, LAUTERIA & COMPANY, P.A. February 1, 1991 612 E.COLONIAL DRIVE•SUITE 350.ORLANDO,FLORIDA 32803-4603•(407)648-0713•FAX(407)839-3975 PRIVATE COMPANIES PRACTICE SECTION•AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS•FLORIDA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS This page intentionally left blank. GENERAL PURPOSE FINANCIAL STATEMENTS (COMBINED STATEMENTS-OVERVIEW) These basic financial statements provide a summary overview of the financial position of all funds and account groups as well as the operating results of all funds. They also serve as an introduction to the more detailed statements that follow in subsequent sections. CITY OF OCOEE, FLORIDA COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 1990 Governmental Fund Types Special Debt General Revenue Service Assets Pooled Cash & Equivalents $ 166, 070 $ 2 , 198, 817 $ 56, 315 Investments --- --- --- Receivables (Net of Allow- ance for Uncollectables) 180, 967 --- --- Inventories-At Cost 5, 396 --- --- Due From Other Funds 69 , 421 --- --- Prepaid Costs 38, 533 --- --- Restricted Assets: Cash, Investments and Accrued Interest: Sinking Funds --- --- --- Capital Improvement Funds --- --- --- With Paying Agent --- --- --- Customer Deposits --- --- --- Property, Plant & Equipment --- --- --- Less: Accumulated Depreciation Construction in Progress --- --- --- Unamortized Bond Issuance Costs --- --- Amount Available in Debt Service Fund --- --- --- Amount to be Provided for Retirement of General Long-Term Debt --- --- --- Total Assets $ 460, 387 $ 2, 198 , 817 $ 56, 315 The accompanying notes are an integral part of the financial statements. -1- Governmental Proprietary Fiduciary Account Groups Fund Types Fund Types Fund Types General General Totals Capital Trust and Fixed Long-Term (Memorandum Projects Enterprise Agency Assets Debt Only) $ --- $ 127 , 581 $ 56, 916 $ --- $ --- $ 2 , 605, 699 --- 300, 000 591, 391 --- --- 891, 391 3 , 078 223 , 365 --- --- --- 407, 410 --- 22 , 152 --- --- --- 27, 548 19, 635 65, 811 --- --- --- 154 , 867 --- 2 , 641 --- --- --- 41, 174 --- 181, 541 --- --- --- 181, 541 5, 168 , 023 10, 697, 743 --- --- --- 15, 865, 766 --- 208 , 124 --- --- --- 208, 124 --- 16, 148 , 502 --- 3 , 305, 466 --- 19, 453 , 968 --- ( 2 , 557, 729) --- --- --- (2 , 557, 729) --- 1, 061, 386 --- --- --- 1, 061, 386 --- 176, 448 --- --- --- 176, 448 --- --- --- --- 7 , 212 , 922 7 , 212 , 922 $ 5, 190, 736 $26, 657, 565 $ 648 , 307 $3 , 305, 466 $7, 212 , 922 $45 , 730, 515 -2- (Continued) CITY OF OCOEE, FLORIDA COMBINED BALANCE SHEET - ALL FUND TYPES AND ACCOUNT GROUPS - CONTINUED SEPTEMBER 30, 1990 Governmental Fund Types Special Debt General Revenue Service Liabilities and Fund Equity Liabilities Deficit in Pooled Cash $ --- $ --- $ --- Accounts Payable 138, 164 45 --- Retainage Payable 59 , 093 --- --- Accrued Expenses 189 , 514 --- 36, 680 Due to Other Funds --- --- 19, 635 Deferred Revenue 50 --- --- Current Liabilities (Payable From Restricted Assets) Accounts Payable from Cap- ital Improvement Funds --- --- --- Customer Deposits --- --- --- Accrued Interest Payable --- --- --- Deferred Compensation Payable --- --- --- Accrued Annual Leave --- --- --- Bonds Payable --- --- --- Notes Payable --- --- --- Obligations under Capital Leases --- --- --- Developer Agreements Payable --- --- --- Total Liabilities 386, 821 45 56, 315 Fund Equity Contributed Capital --- --- --- Investment in General Fixed Assets --- --- --- Retained Earnings: Unreserved --- --- --- Fund Balances: Reserved: Encumbrances 55, 384 --- --- Inventories 5, 396 --- --- Prepaid Costs 38 , 533 --- --- Capital Improvements --- --- --- Debt Service --- --- --- Employee' s Retirement System --- --- --- Unreserved: Undesignated ( 25, 747) 2 , 198 , 772 --- Total Fund Balances 73 , 566 2 , 198 , 772 --- Total Fund Equity 73 , 566 2 , 198 , 772 --- Total Liabilities and Fund Equity $ 460, 387 $ 2 , 198 , 817 $ 56, 315 The accompanying notes are an integral part of the financial statements. -3- Governmental Proprietary Fiduciary Account Groups Fund Types Fund Types Fund Types General General Totals Capital Trust and Fixed Long-Term (Memorandum Projects Enterprise Agency Assets Debt Only) $ --- $ 221, 931 $ --- $ --- $ --- $ 221, 931 205, 773 227, 441 35 --- --- 571, 458 --- 83 , 102 --- --- --- 142 , 195 --- 66, 104 --- --- --- 292 , 298 2 , 981 132 , 251 --- --- --- 154, 867 --- 67 , 086 --- --- --- 67, 136 --- --- --- --- --- --- --- 208 , 124 --- --- --- 208, 124 --- 180, 542 --- --- --- 180, 542 --- --- 156, 944 --- --- 156, 944 --- --- --- --- 81, 982 81, 982 --- 10, 160, 000 --- --- 7, 000, 000 17, 160, 000 --- --- --- --- 4 , 875 4, 875 --- 116, 264 --- --- 126, 065 242 , 329 --- 486, 175 --- --- --- 486, 175 208, 754 11, 949 , 020 156, 979 --- 7 , 212 , 922 19 , 970, 856 --- 11, 856, 554 --- --- --- 11, 856, 554 --- --- --- 3 , 305 , 466 --- 3 , 305,466 --- 2 , 851, 991 --- --- --- 2 , 851, 991 --- --- --- --- --- 55, 384 --- --- --- --- --- 5, 396 --- --- --- --- --- 38, 533 4 , 981, 982 --- --- --- --- 4 , 981, 982 --- --- 434 , 447 --- --- 434 , 447 --- --- 56, 881 --- --- 2 , 229 , 906 4 , 981, 982 --- 491 , 328 --- --- 7 , 745, 648 4 , 981, 982 14 , 708 , 545 491, 328 3 , 305, 466 --- 25 , 759 , 659 $ 5, 190, 736 $26, 657 , 565 $ 648, 307 $3 , 305, 466 $7 , 212 , 922 $45 , 730, 515 -4- CITY OF OCOEE, FLORIDA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS FOR THE YEAR SEPTEMBER 30, 1990 Governmental Fund Types Special Debt General Revenue Service Revenues Taxes $ 1, 967 , 285 $ --- $ --- Licenses and Permits 591, 160 --- --- Intergovernmental Revenues 1, 890, 285 --- --- Charges for Services 66, 231 --- --- Fines and Forfeitures 105, 927 1, 582 --- Impact Fees/Special Assessments --- 1, 731, 306 --- Interest Revenues 17 , 097 73 , 393 1, 292 Miscellaneous Revenues 98, 723 6, 391 --- Total Revenues 4 , 736, 708 1, 812, 672 1, 292 Expenditures Current: General Government 1, 478, 026 --- --- Public Safety 2 , 600, 066 8, 237 --- Physical Environment 565, 066 11, 683 --- Culture and Recreation 202 , 206 7 , 344 --- Capital Outlay --- --- --- Debt Service: Principal Retirement --- --- 213 , 655 Interest Charges --- --- 176 , 033 Total Expenditures 4 , 845, 364 27, 264 389 , 688 Excess of Revenues Over (Under) Expenditures ( 108 , 656) 1, 785, 408 ( 388 , 396) Other Financing Sources (Uses) Operating Transfers In 291, 260 8 , 420 2 , 127, 543 Operating Transfers Out ( 214 , 733) --- ( 19, 733) Proceeds of Capital Leases 156, 770 --- --- Gross Proceeds of Refunding Bonds --- --- --- Bond Issuance Costs --- --- --- Payment to Refund Bond Escrow Agent --- --- (1, 904, 236) Total Other Financing Sources (Uses) 233 , 297 8 , 420 203 , 574 Excess of Revenues and Other Sources Over (Under) Expendi- ture and Other Uses 124 , 641 1, 793 , 828 ( 184 , 822) Fund Balances - Beginning Of Year 8 , 925 404 , 944 184 , 822 Capital Equity Transfers ( 60, 000) --- --- Fund Balances - End of Year $ _ 73 , 566 $ 2 , 198, 772 $ --- The accompanying notes are an integral part of the financial statements. -5- Governmental Fiduciary Fund Types Fund Types Capital Expendable Totals Projects Trust _ (Memorandum Only) $ --- $ --- $ 1,967, 285 --- --- 591, 160 --- --- 1, 890, 285 --- --- 66, 231 --- --- 107, 509 --- --- 1, 731, 306 40,722 1,968 134, 472 --- --- 105, 114 40, 722 1, 968 6, 593 , 362 --- --- 1, 478 , 026 --- --- 2 , 608, 303 --- 5, 087 581, 836 --- --- 209, 550 476, 876 --- 476, 876 --- --- 213 , 655 --- --- 176, 033 476, 876 5, 087 5, 744 , 279 ( 436, 154) ( 3 , 119) 849 , 083 19, 635 --- 2 ,446,858 (1, 997, 385) --- ( 2 , 231, 851) --- --- 156, 770 7, 036, 680 --- 7, 036, 680 ( 413 , 364) --- ( 413 , 364) --- --- (1, 904 , 236) 4 , 645, 566 --- 5, 090, 857 4 , 209, 412 ( 3 , 119) 5, 939, 940 772 , 570 --- 1, 371, 261 --- 60, 000 --- $ 4, 981, 982 $ 56, 881 $ 7 , 311, 201 -6- CITY OF OCOEE, FLORIDA COMBINED STATEMENT OF REVENUES AND EXPENDITURES BUDGET AND ACTUAL - GENERAL FUND FOR THE YEAR ENDED SEPTEMBER 30, 1990 General Fund Variance Budgetary Favorable Budget _ Basis (Unfavorable) Revenues Taxes $ 1, 737, 200 $ 1, 967 , 285 $ 230, 085 Licenses and Permits 451, 300 591, 160 139, 860 Intergovernmental Revenues 1, 799, 900 1, 890, 285 90, 385 Charges for Services 65, 500 66, 231 731 Fines and Forfeitures 126, 000 105, 927 ( 20, 073) Impact Fees/Special Assessments --- --- --- Interest Revenues 8, 000 17 , 097 9 , 097 Miscellaneous Revenues 41, 750 98 , 723 56, 973 Total Revenues 4, 229 , 650 4 , 736 , 708 507 , 058 Expenditures Current: General Government 1, 406, 408 1, 482 , 683 ( 76, 275) Public Safety 2 , 411, 091 2 , 625, 573 ( 214 , 482) Physical Environment 527 , 808 572 , 694 ( 44 , 886) Culture and Recreation 181, 093 202 , 877 ( 21, 784) Total Expenditures 4 , 526, 400 4 , 883 , 827 ( 357, 427) Excess of Revenues Over (Under) Expenditures ( 296, 750) ( 147 , 119) 149, 631 Other Financing Sources (Uses) Operating Transfers In 364 , 550 291, 260 ( 73 , 290) Operating Transfers Out ( 67, 800) ( 214 , 733) ( 146, 933) Proceeds of Capital Leases --- 156, 770 156, 770 Total Other Financing Sources (Uses) 296, 750 233 , 297 ( 63 , 453) Excess of Revenues and Other Sources Over (Under) Expendi- ture and Other Uses $ --- $ 86, 178 $ 86, 178 The accompanying notes are an integral part of the financial statements. -7- CITY OF OCOEE, FLORIDA REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS/FUND BALANCE ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 1990 Proprietary Fiduciary Totals Fund Types Fund Types (Memorandum Enterprise Pension Trust Only) Operating Revenues Charges $ 2 ,446, 324 $ --- $ 2 , 446, 324 Contributions --- 111, 562 111, 562 Revenue Earned on Investments --- 28, 211 28,211 Total Operating Revenues 2 , 446, 324 139, 773 2, 586, 097 Operating Expenses Personal Services 900, 907 --- 900,907 Materials and Supplies 292, 787 --- 292,787 Heat, Light and Power 149, 493 --- 149, 493 Depreciation & Amortization 586, 586 --- 586, 586 Benefit Payments --- 5, 912 5, 912 Other Expenses 378, 885 95 378,980 Recycling Expenses 38, 188 --- 38, 188 Total Operating Expenses 2 , 346, 846 6, 007 2 , 352 , 853 Operating Income (Loss) 99, 478 133 , 766 233 , 244 Nonoperating Revenues (Expenses) Grant Revenue 38, 999 --- 38,999 Interest Revenue 511,909 --- 511,909 Interest Expense ( 410, 864) --- ( 410,864) Total Nonoperating Revenues (Expenses) 140, 044 --- 140, 044 Income (Loss) Before Operating Transfers 239, 522 133 , 766 373 ,288 Operating Transfers Operating Transfers In 2 , 261, 552 --- 2 , 261, 552 Operating Transfers Out (2,476, 559) --- (2 , 476, 559) Net Income (Loss) Before Extraordinary Items 24 , 515 133 , 766 158 , 281 Extraordinary Loss on Advance Refunding ( 51, 612) --- ( 51, 612) Net Income (Loss) $ ( 27, 097) $ 133 ,766 $ 106, 669 Disposition of Net Income Net Income (Loss) $ ( 27, 097) $ 133 , 766 $ 106, 669 Depreciation on Contributed Assets 138 , 799 --- 138 ,799 Net Increase in Retained Earnings/Fund Balance 111, 702 133 , 766 245, 468 Retained Earnings/Fund Balance - Beginning of Year 2 , 740, 289 300, 681 3 , 040,970 Retained Earnings/Fund Balance - End of Year $ 2 , 851, 991 $ 434 , 447 $ 3 , 286, 438 The accompanying notes are an integral part of the financial statements. -8- CITY OF OCOEE, FLORIDA COMBINED STATEMENT OF CHANGES IN FINANCIAL POSITION - ALL PROPRIETARY FUND TYPES AND SIMILAR TRUST FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 1990 Proprietary Fiduciary Totals Fund Types Fund Types (Memorandum Enterprise Pension Trust Only) Sources of Working Capital Net Income (Loss) Before Extraordinary Items $ 24 , 515 $ 133 , 766 $ 158, 281 "gems Not Requiring Working Capital: Depreciation and Amortization 586 , 586 --- 586, 586 Extraordinary Loss on Advance Refunding ( 51, 612) --- ( 51, 612) Working Capital Provided by Operations 559 , 489 133 ,766 693 , 255 Contributions 5, 093 , 225 --- 5, 093 , 225 Increase in Payable From Restricted Assets 287 , 758 --- 287 , 758 Proceeds From Long-Term Debt 10 , 160, 000 --- 10 , 160, 000 Increase in Developers Agreements Payable 213 , 427 --- 213 ,427 Decrease in Prepaid Bond Anticipation Costs 107 , 888 --- 107 , 888 Decrease in Deposit on Land 20, 000 --- 20, 000 Total Sources of Working Capital 16 ,441, 787 133 , 766 16 , 575, 553 Uses of Working Capital Increase in Restricted yssets 6, 976, 581 --- 6, 976, 581 Purchase of Property, Plant and Equipment 4 , 084 , 361 --- 4 , 084 , 361 Decrease in :obligations Under Capital Lease 36, 291 --- 36, 291 Increase in Unamortized Bond Issuance Costs 103 , 492 --- 103 ,492 Advance Refunding of Bonds 6, 070, 338 --- 6 , 070, 338 Total Uses of Working 1 Capital 17 , 271, 063 --- 17 , 271, 063 1 Net Increase (Decrease) in Working Capital S( 829, 276) 133 , 766 $ ( 695, 510) The accompanying notes are an integral part of the financial statements. -9- Proprietary Fiduciary Totals Fund Types Fund Types (Memorandum Enterprise Pension Trust Only) Elements of Net Increase (Decrease) in Working Capital Pooled Cash & Equivalents $ ( 305, 720) $ --- $ ( 305, 720) Investments 200, 000 133 , 766 333 ,766 Receivables 37 , 142 --- 37, 142 Inventory ( 5, 000) --- ( 5, 000) Prepaid Costs 152 --- 152 Due From Other Fund 21, 905 --- 21, 905 Deficit in Pooled Cash ( 168, 505) --- ( 168, 505) Accounts Payable ( 181, 600) --- ( 181, 600) Retainage Payable ( 80, 837) --- ( 80,837) Accrued Expenses ( 19, 344) --- ( 19, 344) Due to Other Funds ( 63 , 844) --- ( 63 , 844) Deferred Revenue 10, 733 --- 10, 733 Obligations Under Capital Leases ( 1, 610) --- ( 1, 610) Developer Agreements Payable ( 272 , 748) --- ( 272, 748) Net Increase (Decrease) in Working Capital /1_1211_22 ) $ 133 , 766 $ ( 695, 510) -10- This page intentionally left blank. I NOTES TO FINANCIAL STATEMENTS This page intentionally left blank. 1 CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the City of Ocoee conform to generally accepted accounting principles as applicable to governments. The following is a summary of the more significant policies: Reporting Entity The City operates under a commission-manager form of gov- ernment whereby the Mayor and Commission are elected by the registered voters of the City of Ocoee. The Commission appoints the City Manager, who in turn performs as the administrator of the everyday operations of the City. The City provides a full range of municipal services as direct- ed by the City Charter including general government, public safety, public improvements, planning and zoning, water and sewer service, refuse collection, and related general administrative services. The accompanying financial statements present the financial position, results of operations, and changes in financial position of the applicable fund types governed by the City Commission of the City of Ocoee in accordance with the National Council on Governmental Accounting (NCGA) State- ment 3 , "Defining the Governmental Reporting Entity" and subsequent NCGA Interpretation 7 clarifying the application of Statement 3 . The reporting entity for the City of Ocoee includes all organizations, functions, and activities of government for which the City (the Mayor and City Commission) exercises oversight responsibility. The criteria used in determining the ability to exercise oversight responsibility over such agencies by the City's elected officials includes, but is not limited to: 1. financial interdependency; 2 . selection of governing authority; 3 . designation of management; 4 . ability to significantly influence operations; and 5. accountability for fiscal matters. If and when, the lines of fiscal responsibility are not clear, the following specific areas have been reviewed: 1. budgetary authority; 2 . responsibility for funding deficits and operating deficiencies; 3 . fiscal management (i.e. , who governs the process controlling the collection and disbursement of funds) ; -11- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Reporting Entity - Continued 4 . revenue characteristics (i.e. , if revenues are derived by means of a public levy or charge) . Other factors of criteria the City considers are the scope of public service and special financing relationships. Based on the above criteria, the funds and account groups shown in the table of contents are included in this report. The following is a brief explanation of Boards and Commis- sions appearing in the City' s overall organizational chart which also have been included in the General Fund portion of these financial statements: 1. The Code Enforcement. Board consists of 7 members appointed by City Commission for the purpose of interpreting provisions of the City' s Code of Ordinances when requested by an administrative City official. 2 . The Planning and Zoning Board consists of 7 members appointed by City Commission. The purpose of this board is to study and make recommendations in areas affecting the systematic future development and betterment of the City; promotion of economic and industrial prosperity; and enhancement of the health, comfort, and conveniences of the citizens. 3 . The Board of Adjustments consists of 5 members appointed by the City Commission for the purpose of holding hearings and making determinations for appeals arising from requests for variances to the Code of Ordinances and special exceptions permitted by the Code of Ordinances. 4 . The Recreation Board consists of 7 members appointed by the City Commission. The purpose of this board is to advise the City Commission on recreation needs and improvements throughout the City. 5. Citizens Advisory Board was organized by the City Commission for the purpose of advising the Commis- sion on the City's Comprehensive Land Use Plan. This board consists of six subcommittees totaling 74 members. -12- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Fund Accounting The accounts of the City are organized on the basis of funds or account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of selfbalancing accounts. The various funds are grouped by type in the financial statements. The following fund types and account groups are used by the City. Governmental Fund Types General Fund To account for all financial resources except those required to be accounted for in another fund. All general tax revenues and other receipts that are not allocated by law or contractual agreement to another fund are accounted for this fund. The general operating expenditures, fixed charges, and capital improvement costs that are not paid through other funds are paid from the general fund. Special Revenue Funds To account for the proceeds of specificrevenue sources (other than expendable trust, or major capital projects) requiring separate accounting because of legal or regulatory provisions or admin- istrative action. Debt Service Fund To account for the accumulation of resources for, and the payment of, general long-term debt princi- pal and interest. Capital Project Fund To account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds) . -13- CITY OF OCOEE, FLORIDA NOTES TO FIN7.NCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Proprietary Fund Types Enterprise Funds To account for operations that are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges, or where the governing body has decided that periodic deter- mination of net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. Fiduciary Fund Types Trust and Agency Funds To account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other governments, and/or other funds. Account Groups General Fixed Assets Account Group To account for all fixed assets of the City, other than those accounted for in the enterprise fund. General Long-Term Debt To account for the outstanding principal balances on any general obligation debt of the City. -14- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Basis of Accounting and Measurement Focus Governmental fund types include the general, special revenue, debt service, and capital projects funds. The governmental fund type measurement focus is upon determi- nation of financial flow (financial position, changes in financial position, sources, uses and balances of financial resources rather than upon net income determination) . These funds are maintained on the modified accrual basis of accounting. Under this method of accounting, revenues are recognized when they become measurable and available as net current assets or when susceptible to accrual ; i. e. , both measurable and available. "Measurable" means that the amount of the transaction can be determined and "avail- able" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Revenues which are susceptible to accrual are principally operating transfers, charges for services and interest. Special assessments are recognized as revenue only to the extent that individual installments are considered current assets. Expenditures are recorded when the liability is incurred, except for principal and interest on general long-term debt, which is recognized when due. In applying the "susceptible to accrual" concept to inter- governmental revenues (grants, entitlements and shared revenues) , the legal and contractual requirements of the numerous individual programs are used as guidance. There are essentially two types of these revenues. In one, monies must be expended on the specific purpose or project before any amounts will be earned by the City; therefore, revenues are recognized based upon when the expenditures are made. In the other, monies are essentially unre- stricted as to purpose of expenditure and revocable only for failure to comply with prescribed compliance require- ments. These resources are reflected as revenues at the time of receipt or earlier if they meet the criterion of availability. -15- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Basis of Accounting and Measurement Focus - Continued *' The proprietary fund type measurement focus is upon deter- mination of capital maintenance (net income, financial position, and changes in financial position) . These funds are maintained on the accrual basis of accounting. This method of accounting relates costs and expenses to the time period in which benefits of the outlays are received. It is intended to provide an accurate matching of these bene- fits with associated revenues. Revenues are recognized when they have been earned and are measurable and expenses are recognized when they are incurred. Utility operating revenues (sanitation, water and sewer revenues and related utility taxes) are recognized during the month of consumption. Services consumed but not billed are accounted for as unbilled utility revenues. The basis of accounting and measurement focus of the expendable trust fund is the same as governmental fund types and therefore is maintained on the modified accrual basis of accounting. The basis of accounting and mea- surement focus of the pension trust funds is the same as proprietary fund types and therefore are maintained on the accrual basis of accounting. Budgets and Budgetary Accounting The City follows these procedures in establishing the budg- etary data reflected in the financial statements: 1. Prior to September 30th, the City Manager submits to the City Commission a proposed operating budget for the fis- cal year commencing the following October 1st. The operating budget includes proposed expenditures and the means of financing them. 2 . Public hearings are conducted at the City Hall to obtain taxpayer comments. 3 . Prior to October 1st, the budget is legally enacted through passage of a resolution. 4 . The City cannot legally exceed the budget; however, the City Manager is authorized to transfer budgeted amounts between departments within any fund. Any revisions that alter the total expenditures of any fund must be ap- proved by the City Commission. -16- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Budgets and Budgetary Accounting - Continued 5. Formal budgetary integration is employed as a management control device during the year for the General, Special Revenue and Enterprise Funds. 6. Budgets legally adopted for the General and Enterprise Funds are prepared on a budgetary basis, whereby encum- brances are treated as expenditures. Unencumbered appropriations are lapsed at year end, except an appro- priation for a capital expenditure. An appropriation for a capital expenditure shall continue in force until the purpose for which it was made has been accomplished or abandoned; the purpose of any such appropriation shall be deemed abandoned if three years pass without any disbursement from or encumbrance of the appropria- tion. 7 . Budgeted amounts presented in the accompanying financial statements have been adjusted for legally authorized revisions of the annual budgets during the year. Encumbrances Encumbrance accounting, under which purchase orders, con- tracts and other commitments for the expenditure of funds are recorded in order to reserve that portion of the applicable appropriation, is utilized in the governmental funds. Encumbrances are reported as reservations of fund balances since they do not constitute expenditures or liabilities. Tap and Impact Fees The City collects water and sewer tap fees which are recorded as operating revenue only to the extent that the amount equals the cost of physical connection to the system. Amounts that substantially exceed the cost to connect are recorded as an addition to contributed capital. Deposits received which reserve capacity in the City' s water and sewer facilities are recorded as contributed capital . Other deposits received from customers are recorded as liability until all legal requirements, as stipulated by the City' s water and sewer ordinances, are fulfilled. Pooled Cash The City, for accounting purposes, maintains a pooled cash (checking) account for all City funds. Pooled cash represents the amount owned by each fund of the City. -17- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINIIED SEPTEMBER 30 , 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Investments Investments, other than the deferred compensation fund (See Note 8) , are stated at cost or amortized cost. Income from investments held by individual funds is recorded in the respective fund as it is earned. Inventories Inventories are stated at cost, using the FIFO method. The cost of governmental fund-type inventories are accounted for by the consumption method, under which such inventory is recorded as an expenditure when used. Unamortized Bond Issuance Costs Bond issuance costs are being amortized on a straight-line basis, which approximates the interest method, over the life of the bonds. Property, Plant and Equipment Property, plant and equipment owned by the enterprise funds is stated at historical cost or estimated historical cost. Additions, improvements, and other capital outlays that significantly extend the useful life of an asset are capi- talized. Other costs incurred for repairs and maintenance are expensed as incurred. Depreciation of plant and equip- ment is provided on the straight line basis over the fol- lowing estimated useful lives: Buildings, 10-30 years Improvements, 20-40 years Equipment, 5 years Contributions of property, plant and equipment received from federal, state or local sources are recorded as contributions to equity when received. Depreciation on contributed property, plant and equipment is recorded as a reduction of contributed capital . General Fixed Assets General fixed assets have been acquired for general governmental purposes. Assets purchased are recorded as expenditures in the governmental funds and capitalized at cost in the general fixed assets account group. In the case of gifts or contributions, such assets are recorded at fair market value at the time received. Certain improvements, such as roads, bridges, curbs, gutters, streets and sidewalks, drainage systems and lighting systems have not been capitalized. Such assets normally are immovable and of value only to the City. No depreciation has been provided on general fixed assets. -18- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Postretirement Benefits The City does not provide any postretirement health care and life insurance benefits for employees. Reserves Governmental Funds Reserves are used to indicate that a portion of the fund balance is not currently available for expenditure or is segregated for a specific future use. Proprietary Funds Reserves are used to segregate a portion of retained earnings for some non-operating use and where prospec- tive liabilities are imminent but not provided for in the financial statements. Capitalization of Interest The City has a policy of capitalizing interest costs relat- ing to construction. Compensated Absences The City accrues accumulated unpaid vacation and sick leave when earned by the employee. The non-current portion (the amount estimated to not be used in the following year) for Governmental Funds is recorded in the General Long-Term Debt Account Group. The liability for Compensated Absences for Proprietary Fund Types is shown as a current liability of those funds. Interfund Transactions Transactions which constitute reimbursements to a fund for expenditures (expenses) initially made are recorded as expenditures or expenses (as appropriate) in the reimburs- ing fund and as reductions of the expenditures (expenses) in the reimbursed fund. All interfund transactions except advances and reimburse- ments are accounted for as transfers. Nonrecurring or non- routine transfers of equity between funds are considered equity transfers. All other interfund transactions are treated as operating transfers. -19- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Total Columns on Combined Statements - Overview Total columns on the combined statements are captioned Memorandum Only to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with gener- ally accepted accounting principles. Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data. NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY Excess of Expenditures Over Appropriations in Individual Funds During the year ended September 30, 1990 , the following funds incurred excess of expenditures over appropriations: Budget Expenditures Excess General Fund $4 , 526, 400 $ 4 , 883 , 827 $357 , 427 Sanitation Fund 688 , 800 703 , 565 14 , 765 Although the General Fund had excess expenditures over appropriations of $357 , 427 the fund also had excess actual revenues over budgeted revenues of $507 , 058 . Although various expenditure accounts of other funds exceed legally adopted budgeted amounts, total fund expenditures did not exceed total fund appropriations. Deficit Retained Earnings At September 30, 1990, the Sanitation Fund had a $41, 597 deficit retained earnings. This deficit will be liquidated in future years by increased rates and operating transfers from other funds. All budgets are prepared on a budgetary basis, whereby encum- brances are treated as budgeted expenditures in the year of incurrence of the commitment to purchase. Budgetary compari- sons presented in this report are on this budgetary basis. -20- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 3 - BUDGET BASIS OF ACCOUNTING Adjustments necessary to convert the expenditures at the end of the year on the GAAP basis to the budgetary basis are as follows: General Expenditures: GAAP Basis $ 4 , 845, 364 Increase (Decrease) due to: September 30, 1989 encum- brances not budgeted as expenditures for year ended September 30, 1990 ( 16, 921) September 30, 1990 encum- brances not budgeted as expenditures 55 , 384 Budgetary Basis $ 4 , 883 , 827 NOTE 4 - CASH AND INVESTMENTS Deposits At year-end, the carrying amount of the City' s deposits was $9 , 760, 700 and the bank balance was $9 , 375, 638 . All deposits were entirely covered by federal depository insurance and by deposits held in banks that are members of the State of Florida ' s Collateral Pool , as specified under Florida law. Florida statutes provide for collateral pooling by banks and savings and loans and limit local government deposits to "authorized depositories" . Investments The City' s investment policies are governed by State statutes and City ordinances. City ordinance allows investments in any financial institution that is formally authorized as a State approved depository for public funds, as identified on the list prepared by the State Treasurer of the State of Florida. The basic allowable investment instruments include the following: 1) The State Board of Administration Local Government Surplus Funds Trust Fund; 2) Negotiable direct obligations of, or obligations the prin- cipal and interest of which are unconditionally guaranteed by the United States Government; -21- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 4 - CASH AND INVESTMENTS - CONTINUED Investments - Continued 3) Interest-bearing time deposits or savings accounts in banks organized under the laws of this state, in national banks organized under the laws of the United States and doing business and situated in this state, in savings and loan associations which are under state supervision, or in federal savings and loan associations located in this state and organized under federal law and federal supervision. ; 4) Obligations of the federal farm credit banks; the Federal Home Loan Mortgage Corporation, including Federal Home Loan Mortgage Corporation participation certificates; or the Federal Home Loan Bank or its district banks or obligations guaranteed by the Government National Mortgage Association; or 5) Obligations of the Federal National Mortgage Association, including Federal National Mortgage Association partici- pation certificates and mortgage pass-through certificates guaranteed by the Federal National Mortgage Association. The City' s investments are categorized to give an indication of the level of risk assumed by the City at September 30, 1990: Category 1 Category 1 includes investments that are insured or registered and for which the securities are held by the City or its agent in the City's name. Category 2 Category 2 includes uninsured and unregistered investments for which the securities are held by a counterparty' s trust depart- ment or agent in the City' s name. Category 3 Category 3 includes uninsured and unregistered investments for which the securities are held by a counterparty' s trust depart- ment or agent, but not in the City's name. -22- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 • NOTE 4 - CASH AND INVESTMENTS - CONTINUED Following is a summary of risk levels assumed by the City at September 30, 1990: Category Carrying Market 1 2 3 Amount Value Investments $ --- $ $ --- $ --- $ --- Agency Fund Investments 156, 944 156, 944 Investment in State of Florida Local Government Pooled Investment Account 6, 687, 072 6, 687 , 072 Total Investments $6, 844 , 016 $6, 844 , 016 NOTE 5 - ACCOUNTS RECEIVABLE The following is an analysis of Accounts Receivable: Governmental Proprietary Fund Types Fund Type Capital General Projects Enterprise Taxes Receivable $ 129, 004 $ --- $ --- Accounts Receivable 54 , 314 --- 307, 358 Other Receivables 649 3 , 078 4 , 514 Total 183 , 967 3 , 078 311, 872 Less: Allowance for Uncollecta- ble Accounts ( 3 , 000) --- ( 88 , 507) $ 180 , 967 $ 3 , 078 $ 223 , 365 NOTE 6 - PROPERTY TAXES All property is reassessed according to its fair value January 1st of each year. Taxes are levied on October 1st of each year. Discounts are allowed for early payment at the rate of 4% in the month of November, 3% in the month of December, 2% in the month of January, and 1% in the month of February. The taxes paid in March are without discount. All unpaid taxes become delinquent on April 1st following the year in which they are assessed. On or around May 31st following the tax year, certificates are sold for all delinquent taxes on real property. -23- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 6 - PROPERTY TAXES - CONTINUED The County bills and collects property taxes and remits them to the City. City property tax revenues are recognized when levied to the extent that they result in current receivables. The City is permitted by the Municipal Finance Law of the State to levy taxes up to $10 per $1, 000 of assessed valuation. The combined tax rate to finance general governmental services for the year ended September 30, 1990, was $4 . 00 per $1, 000 which means that the City has a tax margin of $6. 00 per $1, 000 and could raise up to $1, 305, 483 additional property tax revenue a year from the present assessed valuation of $217, 580, 505 before the limit is reached. NOTE 7 - PROPERTY, PLANT AND EQUIPMENT During the fiscal year ended September 30, 1990, the following changes in general fixed assets occurred: Balance Balance 10-1-89 Additions Deletions 9-30-90 Land $ 465, 243 $ --- $ ( --- ) $ 465, 243 Buildings 838, 007 --- ( --- ) 838 , 007 Improvements 488, 052 41, 193 ( --- ) 529 , 245 Equipment 1, 455, 607 92 , 873 ( 75 , 509) 1 , 472 , 971 $ 3, 246, 909 $ 134 , 066 $ ( 75, 509) $3 , 305 , 466 There was no construction in progress for general fixed assets as of September 30, 1990. The sources of general fixed assets are as follows: Balance Balance 10-1-89 Additions Deletions 9-30-90 General Fund $ 2 , 124 , 060 $ 134 , 066 $ ( 75, 509) $2 , 182 , 617 Special Revenue Funds: Fed. Revenue Sharing 813 , 871 --- --- 813 , 871 Police Trust 7, 635 --- --- 7, 635 Parks 22 , 260 --- --- 22 , 260 Gas Tax Revenue 21, 935 --- --- 21, 935 Contributions - Other 257 , 148 --- --- 257 , 148 $ 3 , 246, 909 $ _ 134 , 066 $ ( 75, 509) $3 , 305 , 466 -24- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 7 - PROPERTY, PLANT AND EQUIPMENT - CONTINUED The components of property, plant and equipment for the Pro- prietary Fund Types at September 30, 1990, are as follows: Proprietary Fund Types Enterprise Land $ 3 , 658 , 878 Buildings 205, 988 Improvements 11, 273 , 290 Equipment 1, 010, 346 16, 148 , 502 Less: Accumulated Depreciation (2 , 557 , 729) $13, 590, 773 Proprietary Fund construction in progress at September 30, 1990, consisted primarily of improvements to water lines and the waste- water plant. During the year, the City capitalized interest expense on con- struction in progress in the following amounts: Water Fund Sewer Fund Total Interest Expense $ 98 , 090 $ 374 , 692 Interest Associated with )i Construction Projects 98 , 090 165, 302 Interest Earned in Construction Accounts 88, 658 104 , 076 Net Interest Capitalized 9 , 432 61, 226 Interest Expense $ 88 , 658 $ 313 , 466 NOTE 8 - RETIREMENT PLANS Defined Benefit Pension Plan and Trust Plan Description The City contributes to a single employer defined benefit pension plan and trust. The plan was effective as of • October 1, 1985 . The City' s payroll for employees covered by the plan for the year ended September 30, 1990 was $3 , 150, 234 . The City' s total payroll for the year ended September 30 , 1990 was $3 , 156, 784 . -25- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED City employees are eligible to participate in the plan when they have completed six months of service with a minimum of 500 hours during the six-month period. Benefits fully vest on reaching five years of service. The plan provides death, but not disability benefits. These benefit provi- sions and all other requirements are established by City ordinance. City employees are not permitted to contribute to the plan. The City is required to contribute the full amount neces- sary to fund the plan, using the actuarial basis specified by City ordinance. Summary of Significant Accounting Policies and Plan Asset Matters Basis of Accounting The plans financial statements are prepared using the accrual basis of accounting. Investments Investments of the plan are in the State of Florida local government pooled investment account. Investments are reported at cost, which approximates market. Pension Plan Obligations The Pension Benefit Obligation (PBO) is reflected as the Actuarial Present Value of Credited Projected Benefits. The PBO is the standard measure of the present value of pension benefits, adjusted for the effects of projected salary increases and any benefits projected to be paid in the future as a result of employee service to date. The measure is intended to help users assess the Public Employee ' s Retirement System (PERS) funding status on a going concern basis, assess progress made in accumulating assets to pay benefits when due, and make comparisons among PERS. This measure is independent of the actuarial funding method used to determine the City' s contribution require- ments. The City' s pension plans use the Frozen Initial Liability Funding Method and is one of the State of Flor- ida ' s acceptable methods. The State of Florida has established guidelines for state and local pension plan funding and requires submission to and approval of the local government's actuarial reports by a state agency, at least every third year. The City' s pension plan, by policy, (1) requires annual actuarial reports as of October 1 of each year, (2) receives employer contributions based on the actuarially determined requirement, and (3) uses the same assumptions (see the following schedule) for deter- mining the PBO and the employer contribution required. -26- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED Pension Plan Obligations - Continued The following schedule is derived from the respective actuarial reports and City information and reflects accounting policies, membership and plan provisions, assumptions and liabilities and funding provisions as of October 1, 1989 : Membership and Plan Provisions October 1, 1989 Employee membership data: Current Retirees and Beneficiaries Terminated Vested Participants 1 Active Plan Participants Vested 48 Nonvested 61 110 Normal Retirement Benefit: Normal Retirement Date and completion of 30 years of service not to exceed the later of age 65 or 10 years participation. Normal Form of Benefit: Single life annuity Normal Retirement Benefit: 20% of compensation. Total retirement bene- f it reduced by 1/30 for each year of service less than 30. Years to Vest: 5 years Assumptions and Liabilities Assumptions: Investment Earnings 7% Salary Increases Attributable to Inflation 4% Salary Increases Attributable to Seniority/Merit -- Post-retirement Benefit Increases 7% Mortality Table 1971 GAM Male Probability of Turnover Sarason W-80 Amortization of Initial Unfunded Liability 40 years -27- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED Assumptions and Liabilities - Continued October 1, 1989 Pension Benefit Obligations: Retirees and beneficiaries currently receiving benefits and terminated employees not yet receiving benefits. $ --- Current Employees Employer-financed Vested 158 , 388 Employer-financed Nonvested 132 , 915 Total Actuarial Present Value of Projected Benefits 291, 303 Net Assets Available for Benefits 300, 472 Unfunded (assets in excess of) Actuarial Present Value of Projected Benefits $ ( 9 , 169) Change in actuarial present value of projected benefits payable as a result of a change in benefit provisions $ --- Contributions Required and Made As a Actuarially determined employer As a Percentage contribution requirement for Dollar of Covered the year beginning 10/1/89 : Amount Payroll Normal Cost $ 98, 282 3 . 99% Unfunded actuarial accrued liability 13 , 280 . 54% Prior year funding standard account deficiency --- ---% Total $ 111, 562 4 . 53% Total Number of Compensation Employees Payroll Characteristics: Participating $ 2 , 462, 828 109 Nonparticipating (ineligible due to minimum service) $ 88 , 202 10 Total $ 2 , 551, 030 119 -28- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED Contributions Required and Made - Continued The actuarial method employed to determine contributions to the fund is the frozen initial liability cost method. It is assumed that an annual contribution (normal cost) is made each year for each participant. This normal cost, if contributed each year from the participant's eligibility date (or what would have been such date if the plan had been in existence on his employment date in its present form) to his normal retirement date, is calculated to be sufficient to provide the retirement benefits provided for him under the plan. The initial liability is the accrual to the initial valu- ation date of all such normal costs assumed payable in prior years for all present participants. The excess of this over the assets (if any) in the fund on that date is the initial unfunded liability. This unfunded liability is brought forward in each valuation year. The normal cost for the second and each succeeding year is determined as follows: first determine the excess of the actuarially redetermined present value of future retirement benefits and ancillary death benefits for then active par- ticipants plus any reserves for retired and terminated employees over the sum of the unfunded liability brought forward to the valuation date and the assets then in the fund. Then divide this figure by the present value of future compensation. Finally, multiply the resulting fraction by the total current compensation for then active participants. To the extent that actual experience for a year is more favorable than that assumed, an actuarial gain will result. This gain will tend to reduce future required contribu- tions. Similarly, if actual experience is less favorable than that assumed, an actuarial loss will result, causing an increase in future required contributions. Neither gains nor losses are separately determined, but either is automatically spread over future normal cost. -29- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30 , 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED Contributions Required and Made - Continued The following is a three-year historical trend to reflect the progress being made in the funding of the City' s pension obligation: Three-Year Historical Trend Information As of October 1, 1989 1988 1987 Net assets available for benefits ex- pressed as a percent- age of pension bene- fit obligations 103 . 15% 93 . 80% _ 68 . 30% Unfunded pension bene- fit obligations ex- pressed as a percent- age of annual covered payroll ( . 37%) . 70% 3 . 00% Employer contributions expressed as a per- centage of payroll for annual covered payroll 4 . 53% 3 . 68% 5 . 30% In the Supplementary Section are the required supplemental ten-year historical trend information about progress being made in accumulating assets to pay benefits when due. The required schedules only reflect the last four years since the effective date of the plan was October 1, 1985 . Deferred Compensation Plan The City has a single employer deferred compensation plan. The plan is voluntary and any employee may elect to par- ticipate. The City offers its employees a deferred compensation plan. created in accordance with Internal Revenue Code Section 457 . The plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. -30- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 8 - RETIREMENT PLANS - CONTINUED Deferred Compensation Plan All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the City (without being restricted to the provisions of benefits under the plan) , subject only to the claims of the City' s general creditors. Participants ' rights under the plan are equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account for each participant. It is the opinion of the City that it has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. In accordance with current professional pronouncements, the City has accounted for its deferred compensation plan as an agency fund in its financial statements. The assets are stated at the market value which is represented by the con- tract value provided by the City' s third-party administra- tor. Employee contributions to the plan for the fiscal year ended September 30, 1990 were $27 , 329 . NOTE 9 - OVER 65 ASSISTANCE PROGRAM The City of Ocoee, Florida began this program March 1, 1975. The program provides that persons over 65 who qualify are entitled to receive free water and sanitation services. They are also entitled to be reimbursed for City of Ocoee, Florida ad- valorem taxes after the taxes have been paid by the individual to the Orange County tax collector. Approximately 430 residents of the City participated in this program during the fiscal year ended September 30, 1990 . All expenditures under this program are shown as expenditures of the general fund. -31- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 9 - OVER 65 ASSISTANCE PROGRAM - CONTINUED The cost of the program during the current fiscal year is summarized as follows: Water Excise Tax $ 5, 302 Ad-Valorem Taxes 17 , 870 Water Fees 53 , 130 Sanitation Fees 55, 666 Total Over 65 Cost $ 131, 968 NOTE 10 - BONDS AND NOTES PAYABLE Summarized below are the City' s bonds and notes outstanding at Sep- tember 30 , 1990: Water and Sewer Funds Water and Sewer System Revenue Bonds, Series 1989A - payable in quarterly in- terest only payments at 7 . 05% through De- cember 1995 whereby the entire outstand- ing principal is due. Allocation: Water Fund $ --- Sewer Fund 6 , 160 , 000 Total $ 6, 160, 000 Water and Sewer System Revenue Bonds, Series 1989B - payable in quarterly in- terest only payments at 7 . 05% through De- cember 1995 whereby the entire outstand- ing principal is due. Allocation: Water Fund $ 2 , 160, 000 Sewer Fund 1, 840 , 000 Total 4 , 000 , 000 Less: Current maturities --- Unamortized bond discount --- $10, 160 , 000 General Long-Term Debt Account Group Transportation Refunding and Improvement Revenue Bonds, Series 1990 - payable in annual installments of $105 , 000 to $2 , 510 , 000 through 2015 with semi-annual interest payments at 6 . 0% to 7 . 5% . $ 7 , 000, 000 Notes payable (2) on office equipment, payable in monthly installments totalling $547 , including interest at 12% . 4 , 875 $ 7 , 004, 875 -32- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 10 - BONDS AND NOTES PAYABLE - CONTINUED Waste and Sewer System Revenue Bonds, Series 1989A In December 1989, the City issued Water and Sewer System Revenue Bonds, Series A to refinance the Sewer System Revenue Bonds, Series 1987 . These bonds are secured by the combined water and sewer fund operating revenues and interest earnings. The major provisions of the ordinance authorizing the revenue bonds are as follows: 1) The City shall make monthly deposits in an interest sink- ing fund of 1/3 of the next quarterly interest payment. 2) Each month, provisions shall be made of the gross revenues sufficient to pay, in order of preferences, cost of opera- tion and maintenance of the systems, then debt serv- ice/sinking fund requirements. 3) The City shall establish rates which will provide for necessary operating expenses and 110% of the bond service requirement due that year. Waste and Sewer System Revenue Bonds, Series 1989B In December 1989, the City issued Water and Sewer System Revenue Bonds, Series 1989B to finance improvements to the City' s water and sewer systems. These bonds are secured by the combined Water and Sewer Fund operating revenues, interest earnings, impact fees and a first priority pledge of cash payments due from developers. The major provisions of the ordinances authorizing the revenue bonds are as follows: 1) The City shall make monthly deposits in an interest sinking fund of 1/3 of the next quarterly interest payment. 2) Each month, provisions shall be made of the gross revenues sufficient to pay, in order of preference, cost of operation and maintenance of the systems, then debt service/sinking fund requirements. 3) The City shall establish rates which will provide for necessary operating expenses and 110% of the bond service requirement due that year. -33- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30 , 1990 NOTE 10 - BONDS AND NOTES PAYABLE - CONTINUED Florida Transportation Refunding and Improvement Revenue Bonds, Series 1990 In September 1990 , the City issued revenue bonds to finance the advance refund of $1, 895, 000 outstanding series 1987 bonds and the paving, extension and improvement of certain streets within the corporate limits. These bonds are secured by the Local Option Gas Tax and certain local Public Service Taxes. The major provisions of the ordinance authorizing the revenue bonds are as follows: 1) The City shall make monthly deposits in a sinking fund of 1/12 and 1/6 of the next maturing principal and interest payment, respectively. 2) The City shall establish a revenue fund and will deposit all pledged revenues to be used for funding the monthly sinking fund requirements. Any excess funds may be withdrawn and used by the City for any legal purpose. Following is a maturity schedule of outstanding bonds and notes payable: General Long-Term Year Ended Debt Enterprise Funds Total Debt Sept. 30 : Principal Interest Principal Interest Service 1991 $ 109 , 875 $ 550, 572 $ --- $ 716, 280 $ 1, 376 , 727 1992 120, 000 501, 573 --- 716 , 280 1, 337 , 853 1993 125, 000 494 , 192 --- 716, 280 1, 335 , 472 1994 135, 000 486 , 318 --- 716 , 280 1, 337 , 598 1995 145, 000 477 , 677 10 , 160 , 000 179 , 070 10 , 961, 747 1996 155, 000 468 , 253 --- --- 623 , 253 1997 165, 000 458 , 022 --- --- 623 , 022 1998. 175, 000 446, 968 --- --- 621, 968 1999 185, 000 435, 067 --- --- 620, 067 2000 200, 000 422 , 303 --- --- 622 , 303 2001-2005 1, 230 , 000 1, 875 , 762 --- --- 3 , 105, 762 2006-2010 1, 750, 000 1, 353 , 300 --- --- 3 , 103 , 300 2011-2015 2 , 510 , 000 591, 000 --- --- 3 , 101, 000 $7, 004, 875 $8 , 561, 007 $10, 160, 000 $3 , 044 , 190 $28 , 770 , 072 -34- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 10 - BONDS AND NOTES PAYABLE - CONTINUED During the year ended September 30, 1990, the following changes in general long-term debt occurred: Accrued Capital Bonds and Annual Lease Notes Leave Obligations Payable Total Balance at October 1, 1989 $ 32 , 713 $ --- $2 , 085, 213 $2 , 117 , 926 New debt issued/ Additions 49, 269 156, 770 7, 000, 000 7, 206, 039 Principal payments --- ( 30, 705) ( 185, 338) ( 216, 043) Bonds Refunded --- --- (1, 895, 000) (1, 895, 000) Balance at Septem- ber 30, 1990 $ 81, 982 $ 126 , 065 $7 , 004 , 875 $7 , 212 , 922 NOTE 11 - REFUNDINGS General Long-term Debt On September 1, 1990, the City issued $7 , 000, 000 Transportation Refunding and Improvement Revenue Bonds, Series 1990 with an average interest rate of 7 . 4% to advance refund the City' s Public Improvement Revenue Bonds, Series 1987 , with an average interest rate of 7 . 16%. The net proceeds of $6 , 619, 345 (after payment of $380, 655 in underwriting fees, insurance and other service costs) plus and additional $423 , 290 of 1987 series sinking and construction fund monies were used as follows: Construction Fund (to finance project, acquisition and construction costs for road improvement) . $ 5, 081, 930 Escrow Fund (deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1987 series bonds) . 1, 960, 705 As a result, the 1987 series bonds are considered to be de- feased and the liability for those bonds has been removed from the general long-term debt account group. -35- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 11 - REFUNDINGS - CONTINUED As a result of the 1990 series refunding, the City in effect increased aggregate debt service payments by approximately $1, 600 , 000, but obtained an economic gain (difference between the present values of the debt service payments on the old and new debt) of $14 , 017 . Sewer System Revenue Bonds On December 29 , 1989 , the City issued $6, 160 , 000 in Series A Revenue bonds with an average interest rate of 7 . 05% to advance refund $6, 070 , 338 of outstanding 1987 Series bonds with an average interest rate of 7 . 5% . The net proceeds were used to refund the outstanding 1987 Series bonds. As a result, the 1987 Series bonds are no longer outstanding. Although the advance refunding resulted in the recognition of an accounting loss of $51, 612 and an economic loss (difference between the present values of the old) of $2 , 407 , 00 . The City in effect reduced its aggregate debt service payments by approximately $2 , 873 , 000 over the next 15 years. NOTE 12 - CAPITAL LEASE OBLIGATION The City has entered into leases for vehicles and data process- ing, communications and office equipment. The terms of these leases are such that the City has capitalized the equipment and reflected the obligations in the General Long-term Debt Account Group (Governmental Fund Types) or in proprietary fund types. Equipment under capital leases recorded in the General Fixed Asset Account Group at September 30, 1990 consists of the following: Data Processing Equipment $ 89 , 285 Communication Equipment 55 , 968 Office Equipment 11, 517 $ 156, 770 The obligations on the above equipment recorded in the General Long-Term Debt Account Group at September 30, 1990 consists of the following: Capital Lease Obligation, due $2 , 275 per month including interest at 10. 2%, final payment due November 1993 , secured by data processing equipment. $ 73 , 562 -36- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 12 - CAPITAL LEASE OBLIGATION - CONTINUED Capital Lease Obligation, due $346 per month including interest at 18 . 0%, final payment due November 1992 , secured by of- fice equipment. $ 7, 040 Capital Lease Obligation, due $1, 194 per month including interest at 10. 95%, final payment due June 1994 , secured by communi- cation equipment. 45 , 463 $ 126, 065 The following is a schedule by years of future minimum lease payments under the above capital leases, together with the present value of the net minimum lease payments as of September 30, 1990: Year Ending September 30: 1991 $ 45, 779 1992 45, 779 1993 42 , 318 1994 15, 204 Total Minimum Lease Payments 149 , 170 Less, Amounts Representing Interest ( 23 , 105) Present Value of Net Minimum Lease Payments $ 126 , 065 The total of assets capitalized under lease-financing arrange- ments in proprietary fund types is as follows: Sewer Sanitation Fund Fund Totals Assets Capitalized (Equipment) $ 64 , 782 $ 118 , 002 $ 182 , 784 Less Accumulated Amortization ( 18 , 355) ( 37, 929) ( 56, 284) $ 46, 427 $ 80, 073 $ 126 , 500 -37- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 12 - CAPITAL LEASE OBLIGATIONS - CONTINUED The following is a summary of the City' s capital lease obliga- tions recorded in the proprietary fund types as of September 30, 1990 : Sewer Fund Capital lease obligation, due $1, 374 per month including interest at 10. 29% . Se- cured by vehicle. Amortization of this capital lease is included in depreciation expense. $ 48 , 285 Sanitation Fund Capital lease obligations, due $2 , 489 in- cluding interest at 9 . 74% . Secured by two vehicles. Amortization of this capi- tal lease is included in depreciation ex- pense. $ 67 , 979 The following is a schedule by years of future minimum lease pay- ments under the above capital lease, together with the present value of the net minimum lease payments as of September 30: Year Ending Sewer Sanitation September 30 : Fund Fund Totals 1991 $ 16 , 488 $ 29 , 870 $ 46, 358 1992 16, 488 29 , 870 46, 358 1993 16, 488 17 , 424 33 , 912 1994 9 , 618 --- 9 , 618 Total Minimum Lease Payments 59 , 082 77 , 164 136, 246 Less, Amount Repre- senting Interest ( 10 , 797) ( 9 , 185) ( 19 , 982) Present Value of Net Minimum Lease Payments $ 48 , 285 $ 67 , 979 $ 116, 264 The current and noncurrent obligation under these capital leases are $35, 337 and $80 , 927 , respectively. -38- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 13 - DEVELOPER AGREEMENTS PAYABLE The City' s Water and Sewer Funds entered into several water and/or sewer agreements with private developers whereby the developer constructs and installs treatment plants, distribution systems, etc. , and then conveys these projects to the Funds. Each Fund reimburses the developer for the project over a period of time based on specified percentages of connection fees and/or service charges collected. The assets acquired under these agreements are recorded at the estimated developer' s cost of the projects and depreciated over their estimated useful economic lives. The following is a sum- mary of the liability as of September 30, 1990 : Total reimbursable costs of developers $ 486, 175 Less current position 272 , 748 Long-term portion $ 213 , 427 NOTE 14 - INTERFUND RECEIVABLES AND PAYABLES The following schedule as of September 30, 1990, represents interfund receivables and payables: Interfund Interfund Fund Type Receivables Payables General Fund $ 69 , 421 $ --- Debt Service --- 19 , 635 Capital Projects 19, 635 2 , 981 Enterprise Funds: Water 22 , 283 40, 353 Sewer 43 , 528 59, 541 Sanitation --- 32 , 357 $ 154 , 867 $ 154, 867 -39- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 15 - SEGMENT INFORMATION FOR ENTERPRISE FUNDS The City maintains three enterprise funds which provide water, sewer and sanitation services. Segment information for the year ended September 30, 1990, is as follows: Water Sewer Sanitation Total Operating Revenues $ 878 , 280 $ 908, 622 $ 659 , 422 $ 2 , 446 , 324 Depreciation and Amortization $ 302, 942 $ 249 , 576 $ 34 , 068 $ 586 , 586 Operating Income (Loss) $ ( 54, 049) $ 139, 485 $ 14 , 042 $ 99 , 478 Operating Grants $ --- $ --- $ 38, 999 $ 38 , 999 Operating Transfers: In $ 491, 639 $ 1, 769, 913 $ --- $ 2 , 261 , 552 Out $ ( 623, 166) $ (1, 783 , 616) $ ( 69, 777) $ (2, 476, 559) Net Income (Loss) $ ( 132 , 768) $ 131, 147 $ ( 25, 476) $ ( 27 , 097) 1 Current Capital Contributions $2 , 160, 095 $ 2, 933, 1.30 $ --- $ 5, 093 , 225 Property Additions $1, 758 , 045 $ 2 , 311, 646 $ 14 , 670 $ 4 , 084 , 361 Property Deletions $ ( --- ) $ ( --- ) $ ( --- ) $ ( -__ ) Net Working Capital 1_116_4_222 $ ( 514 049) $( 96, 701) $ ( 364 , 450) Total Assets $9, 544, 857 $16, 950, 340 $ 162 , 368 $26, 657, 565 Long-Term Debt $1, 934 , 783 $ 8, 475, 906 $ 43 , 665 $10 , 454 , 354 Total Equity (Deficit) $7 , 084 , 093 $ 7, 666, 049 $ ( 41, 597) _14 , 708 , 545 -40- CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1990 NOTE 16 - CONTRIBUTED CAPITAL The following is a summary of changes in contributed capital during the year ended September 30, 1990: Water Sewer Sanitation Total Contributed Capital - Beginning of Year $2 , 348 , 812 $4, 553 , 316 $ --- $ 6, 902 , 128 Additions (Reduc- tions) Connection Fees 1, 129 , 022 2 , 172 , 913 --- 3 , 301, 935 Developers 1, 031, 073 760, 217 --- 1, 791, 290 Depreciation on Contri- buted Assets ( 112 , 330) ( 26, 469) ( --- ) ( 138 , 799) Contributed Capital - End of Year $ 4 , 396, 577 $7, 459, 977 $ --- $11, 856, 554 NOTE 17 - SUMMARY DISCLOSURE OF SIGNIFICANT CONTINGENCIES Federally Assisted Programs - Compliance Audits The City participates in various federally assisted programs. These programs are subject to a compliance audit by the grantor or its representative. The audits of these programs for the year ended September 30, 1990, have not been concluded. Accord- ingly, the City' s compliance with applicable program require- ments will be established at some future date. The amount, if any, of expenditures which may be disallowed by the grantor cannot be determined at this time, although the City expects such amounts, if any, to be immaterial . Litigation During the ordinary course of its operations, the City is a party to various claims, legal actions and complaints. In the opinion of the City' s management and legal counsel , these matters are not anticipated to have a material financial impact on the City. Commitments Construction Contracts - At September 30, 1990, the City had outstanding construction contracts for various projects totaling approximately $75 , 250. -41- This page intentionally left blank. APPENDIX D FOLEY & LARDNER BARNETT PLAZA•SUITE 3650 101 EAST KENNEDY BOULEVARD POST OFFICE BOX 3391 JACKSONVILLE, FLORIDA TAMPA, FLORIDA 33601-3391 MILWAUKEE. WISCONSIN ORLANDO. FLORIDA MADISON, WISCONSIN TALLAHASSEE, FLORIDA TELEPHONE 18131 229-2300 CHICAGO, ILLINOIS WEST PALM BEACH. FLORIDA PINELLAS COUNTY 18131 446-9641 ITASCA. ILLINOIS WASHINGTON, D.C. TELECOPIER 18131 229-6282 ALEXANDRIA. VIRGINIA ANNAPOLIS, MARYLAND , 1991 WRITER'S DIRECT LINE Re: City of Ocoee, Florida, Capital Improvement Revenue Bonds, Series 1991 We have acted as Bond Counsel in connection with the issuance by the City of Ocoee, Florida (the "Issuer") of its Capital Improvement Revenue Bonds, Series 1991, in the aggregate principal amount of $2,580,000, dated as of April 1, 1991 (the "Bonds"). The Bonds are issued for the purpose of funding a portion of the cost of construction, expansions, additions, improvements and equipping of the Issuer's city hall and police station, funding a reserve fund and paying certain costs of issuance. We have investigated the law and examined such certified proceedings and other papers as we have deemed necessary to render this opinion, including Chapter 166, Florida Statutes, as amended, certified copies of the proceedings of the City Commission of the Issuer authorizing the issuance of the Bonds and other proofs submitted relative to the authorization, issuance and sale of and the security for the Bonds. We have not been engaged or undertaken to review the accuracy, completeness or sufficiency of the Official Statement or other offering material relating to the Bonds, except to the extent, if any, stated in the Official Statement, and we express no opinion relating thereto (excepting only the matters set forth as our opinion in the Official Statement). As to questions of fact material to our opinion, we have relied upon the representations of the Issuer contained in various certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent investigation. Based upon the foregoing, we are of the opinion, under existing law, as follows: , 1991 Page 2 (1) The Issuer is a political subdivision duly organized and validly existing under and by virtue of the laws of the State of Florida. IL (2) Resolution No. 91- and Resolution No. 91- (the "Resolution") have been duly adopted by the Issuer and constitute valid and binding obligations of the Issuer enforceable in accordance with their terms. (3) The Resolution creates a valid lien on the funds pledged thereunder for the security of the Bonds. (4) The Bonds have been duly authorized, executed and delivered by the Issuer and are valid and binding limited obligations of the Issuer, enforceable in accordance with their terms. (5) The interest on the Bonds is excluded from gross income for Federal income tax purposes. Furthermore, interest on the Bonds is not an item of tax preference for purposes of the Federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for Federal income tax purposes), such interest is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations. For the purpose of rendering the opinion set forth in this paragraph, we have assumed compliance by the Issuer with requirements of the Internal Revenue Code of 1986 that must be met subsequent to the issuance of the Bonds in order that the interest thereon be and remain excluded from gross income for Federal income tax purposes. Failure to comply with such requirements could cause the interest on the Bonds to be included in gross income retroactive to the date of issuance of the Bonds. The Issuer has covenanted to comply with such requirements. We express no opinion regarding other Federal tax consequences arising with respect to the Bonds. (6) The Bonds and the income therefrom are exempt from taxation under the laws of the State of Florida, except as to estate taxes and taxes imposed by Chapter 220, Florida Statutes, on interest, income or profits on debt obligations owned by corporations as therein defined. It is to be understood that the rights of the holders of the Bonds and the enforceability of the Bonds and the Resolution may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted to the extent constitutionally applicable and that their enforcement may also FOLEY & LARDNER , 1991 Page 3 be subject to the exercise of judicial discretion in accordance with general principles of equity. Very truly yours, FOLEY & LARDNER FOLEY & LARDNER GL 4 o.j V-16- 9/ ..�7c.► J U •2 RESOLUTION NO. 91-08 A RESOLUTION AUTHORIZING THE NEGOTIATED SALE OF $2, 580, 000 CITY OF OCOEE, FLORIDA, CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 1991; AWARDING THE SALE THEREOF TO WILLIAM R. HOUGH & CO. , SUBJECT TO THE TERMS AND CONDITIONS OF A PURCHASE CONTRACT; AUTHORIZING THE DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT AND A FINAL OFFICIAL STATEMENT IN CONNECTION WITH THE DELIVERY OF THE BONDS; AUTHORIZING THE ISSUANCE OF SUCH BONDS; PROVIDING CERTAIN OTHER MATTERS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Ocoee, Florida (the "Issuer") , has by Resolution NO. 91- 07, adopted on April 16, 1991, (the "Resolution") , authorized the issuance of not to exceed $2 , 600, 000 City of Ocoee, Florida, Capital Improvement Revenue Bonds, Series 1991, to finance the acquisition, construction, expansion, renovation, installation and equipping of the City of Ocoee's city hall and police station (the "Project") ; and WHEREAS, due to the present instability in the market for revenue obligations the interest on which is excluded from federal gross income, the critical importance of the timing of the sale of the Bonds, and due to the willingness of William R. Hough & Co. (the1 "Underwriter") to purchase $2 , 580, 000 principal amount of City of Ocoee, Florida, Capital Improvement Revenue Bonds, Series 1991 (the "Bonds") , at interest rates favorable to the Issuer, it is hereby determined that it is in the best interest of the public and the Issuer to sell the Bonds at a negotiated sale; and WHEREAS, the Issuer has received an offer from the Underwriter to purchase the Bonds, subject to the terms and conditions set forth in the Contract of Purchase, a copy of which is attached hereto as Exhibit A (the "Purchase Contract") ; and WHEREAS, the Issuer now desires to sell its Bonds pursuant to the Purchase Contract and to authorize distribution of an Official Statement in connection with the issuance of the Bonds; and WHEREAS, the Issuer has been provided all applicable disclosure information required by Section 218 . 385, Florida Statutes, a copy of which is attached as an exhibit to the Purchase Contract; and WHEREAS, all capitalized undefined terms used herein shall have the meaning set forth in Resolution 91- 07 * NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE, FLORIDA: SECTION 1. The Bonds are hereby sold to William R. Hough & Co. , upon the terms and conditions set forth in the Purchase Contract attached hereto as Exhibit A and incorporated by reference. The Mayor and the City Clerk of the Issuer are hereby authorized to execute such Purchase Contract in substantially the form attached as Exhibit A, with such additional changes, insertions and omissions therein as do not change the substance thereof and as may be approved by the said officers of the Issuer executing the same and the City Attorney, such execution to be conclusive evidence of all such approvals. 2 SECTION 2 . The Bonds shall be dated April 1, 1991, shall bear interest at the rates, shall be in such denomination, shall mature in the years and amounts, and shall be subject to redemption, as set forth in the Exhibits to the Purchase Contract. SECTION 3 . The Bonds shall be issued under and secured by the Resolution and shall be executed and delivered by the Mayor and attested by the City Clerk of the Issuer in substantially the form set forth in the Resolution, with such additional changes and insertions therein as conform to the provisions of the Purchase Contract, and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 4 . The distribution by the Underwriter of a Preliminary Official Statement of the Issuer relating to the Bonds is hereby approved, confirmed and ratified, and a final Official Statement of the Issuer relating to the Bonds is hereby approved in substantially the form of the Preliminary Official Statement attached as an Exhibit to the Purchase Contract. The Official Statement will be executed by appropriate officers of the Issuer, such execution to be conclusive evidence of approval of the Official Statement in its final form. SECTION 5. The Reserve Fund Requirement for the Bond shall .............................. be $ $249;:,945. SECTION 6. All prior resolutions or other actions of the Issuer inconsistent with the provisions of this Resolution are hereby modified, supplemented and amended to conform with the provisions herein contained and except as otherwise modified, 3 supplemented and amended hereby shall remain in full force and effect. SECTION 7. The Mayor and the City Clerk, the City Attorney of the Issuer or any other appropriate officers of the Issuer are hereby authorized and directed to execute any and all certifications or other instruments or documents required by the Resolution, the Purchase Contract, this Resolution or any other document referred to above as a prerequisite or precondition to the issuance of the Bonds and any such representation made therein shall be deemed to be made on behalf of the Issuer. All action taken to date by the officers of the Issuer in furtherance of the issuance of the Bonds is hereby approved, confirmed and ratified. SECTION 8. In accordance with the Code, the Issuer represents and covenants that it is a governmental unit with taxing powers; that the Bonds are not private activity bonds as defined in Section 141 (a) of the Code; that 95% or more of the net proceeds of the Bonds (i.e. , the face amount of the Bonds) , are to be used for the local governmental activities of the Issuer and that the aggregate face amount of all obligations of the Issuer (including all subordinate entities of the Issuer and entities, if any, which issue bonds on behalf of the Issuer) , the interest on which is not includable in federal gross income (other than private activity bonds as defined in Section 142 (a) of the Code) , issued during the calendar year 1991 will not exceed $5, 000, 000. SECTION 9. This Resolution has been adopted pursuant to an advertised public hearing held on March 5, 1991 in accordance with 4 and pursuant to the provisions of the Charter of the City of Ocoee. SECTION 10. This Resolution shall be in full force and effect immediately upon its adoption and approval in the manner provided by law. PASSED AND ADOPTED IN PUBLIC SESSION of the City Commission of the City of Ocoee, Florida, this day of April A.D. , 1991. APPROVED this day of , A.D. , 1991, at o'clock p.m. Lester Dabbs, Jr. , Mayor FILED in the Office of the City Clerk this day of April, 1991. Joan Crafton, Acting City Clerk FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY BY THE CITY OF OCOEE, FLORIDA, COMMISSION AT A MEETING APPROVED AS TO FORM AND LEGALITY HELD ON THIS DAY OF , 1991 UNDER AGENDA ITEM NO. 1991. FOLEY & LARDNER By: City Attorney 5 EXHIBIT A PURCHASE CONTRACT [To come from Hough] CAWPSI\DOCS\OCOEE\AWRDRES414/16/911TPAB l9;DAG:Ib LAC-KL INE 0 TO HF PAA-CS JAA-41,0 a.A i/4/,, CBSt, 2 4161111 116 , 1 $2,580,000 CITY OF OCOEE, FLORIDA CAPITAL IMPROVEMENT REVENUE SERIES 1991 CONTRACT OF PURCHASE Honorable Mayor and Commissioners City of Ocoee 150 Lakeshore Drive Ocoee, Florida 34761 Gentlemen: William R. Hough & Co. (the "Underwriter") hereby offers to enter into this Contract of Purchase ("Contract of Purchase") with the City of Ocoee, Florida (the "City") for its $2,580,000 City of Ocoee, Florida Capital Improvement Revenue Bonds, Series 1991, to be dated as of April 1, 1991 (the "Bonds") . This offer is made subject to acceptance by the City prior to 11:59 p.m. , New York City time on the date hereof, and upon such acceptance this Contract of Purchase shall be in full force and effect in accordance with its terms and shall be binding upon the City and the Underwriter. 1. Upon the terms and conditions and upon the basis of the representations herein set forth, the Underwriter hereby agrees to purchase from the City and the City hereby agrees to sell to the Underwriter all (but not less than all ) of the Bonds at an aggregate purchase price of $2,543.493.(such amount representing the aggregate principal amount of the Bonds of $2,580,000 less an underwriter's discount of 1.415% of the principal amount of the Bonds) plus accrued interest from Apri 11,1991 to the Date of Closing referred to in Section 6 hereof. The Bonds shall be as described in, and shall be issued under the authority of and in full compliance with, the Constitution and Statutes of the State of Florida, including particularly Chapter 166, Part II, Florida Statutes, Resolution No. 91-07 of the City adopted on April 16, 1991, as amended and supplemented tthe "Resolution"), authorizing issuance of the Bonds with only such changes therein as shall be agreed upon between us. The Bonds shall mature at the time and in the amount and bear interest at the rates set forth in Schedule I hereto and shall be redeemable as set forth in Schedule II hereto. All capitalized words and phrases used herein, unless otherwise noted, shall have the meaning given to them in the Resolution. The Underwriter agrees to make a public or private offering of the Bonds at the initial offering prices set forth in the Official Statement (as described below) relating to the Bonds; provided, however, that the Underwriter reserves the right to make concessions to dealers and to change such initial offering prices as the Underwriter shall deem necessary in connection with the marketing of the Bonds. 2. The Underwriter herewith delivers a check payable to the order of the City in the amount of one percent (1%) of the principal amount of the Bonds to be held uncashed as security for the performance by the Underwriter of its obligations to accept and pay for the Bonds at the Closing in accordance with the provisions of this Contract of Purchase. If the City does not accept this offer, or upon the City's failure to deliver the Bonds at Closing, or if the City shall be unable to satisfy the conditions to the obligations of the Underwriter contained in this Contract of Purchase (unless waived by the Underwriter) , or if such obligations shall be terminated for any reason permitted by this Contract of Purchase, or otherwise at the Closing, you shall immediately return said check. If the Underwriter fails (other than for a reason permitted under this Contract of Purchase) to accept and pay for the Bonds at the Closing, the check may be cashed and the proceeds thereof shall be retained by the City as and for full liquidated damages for such failure and for any and all defaults hereunder on the part of the Underwriter, and thereupon all your claims and rights under this Contract of Purchase against the Underwriter shall be fully released and discharged. You and the Underwriter understand that in such event your actual damages may be greater or may be less than such sum. Accordingly, the City_ hereby waives any right it may have to additional damages from the Underwriter. Upon delivery of the Bonds by the City at Closing and payment by the Underwriter for such Bonds, as set forth herein, said check shall be returned to the Underwriters uncashed at Closing. 3. The Underwriter's purchase and acceptance of delivery of the entire $2,580,000 aggregate principal amount of the Bonds shall be a condition to the City's obligation to sell and deliver any Bonds to the Underwriter. 4. With your acceptance hereof, you will deliver to the Underwriter within seven business days after acceptance hereof, two copies of (a) the Official Statement (which term as used herein shall include the cover page, the summary statement and appendices contained therein) , dated the date hereof substantially in the form of Schedule III hereto (the "Official Statement"), executed on your behalf as indicated therein, and (b) the Resolution, certified by the Clerk of the City. In addition, as promptly as practicable after the date hereof, the City shall deliver to the Underwriter 250 copies of the Official Statement and shall furnish as many additional copies as may be mutually agreeable and are reasonably necessary to enable the Underwriter to comply with the requirements of Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Rule") and to fulfill its duties and responsibilities under the federal securities laws generally. The Official Statement shall be delivered to the Underwriter in final , printed form within seven business days after the date hereof. The Underwriter agrees to file the Official Statement with a Nationally Recognized Municipal Securities Information Repository ("NRMSIR") which has been so designated by the Securities and Exchange Commission pursuant to Rule 15c2-12 not later• than two business days after the Closing, and will furnish the name and address of the NRMSIR to the City upon request. The filing of the Official Statement with the NRMSIR shall be in accordance with the terms and conditions applicable to such NRMSIR. The City hereby agrees and covenants to furnish 2 ongoing reports and information to the Underwriter as are or may become customary in the industry for municipal obligations similar to the Bonds, and specifically to furnish to the underwriter annually a copy of the City's audited financial statements when such becomes available. The City further hereby agrees and covenants to furnish to the Underwriter such other information as becomes available from time to time as would have been included in the Official Statement had the information been known at the time of the preparation thereof which information shall include data concerning any material adverse change in its business, properties or financial condition occurring either (i) before the Date of Closing or (ii) for the period thereafter during which the Underwriter is obligated to deliver a copy of the Official Statement in accordance with the Rule. The City authorizes the use and distribution of the Official Statement in connection with the public offering and sale of the Bonds. The City hereby ratifies and approves the use of the Preliminary Official Statement (the "Preliminary Official Statement") by the Underwriter and confirms that the Preliminary Official Statement was deemed final within the meaning of the Rule except for certain permitted omissions. The Underwriter agrees that it will not confirm the sale of Bonds unless a final written confirmation of sale is accompanied or preceded by the delivery of a copy of the Official Statement. 5. The City hereby represents and agrees as follows: (a) The City is and will be at the Date of Closing duly organized and validly existing as a municipal corporation under the laws of the State of Florida with the powers and authority set forth in the Florida Statutes, including particularly Chapter 166 and the Charter of the City, and any other applicable laws (collectively, the "Act") ; (b) The City has full legal right, power and authority to: (i) enter into this Contract of Purchase, (ii ) adopt the Resolution, (iii) sell , issue and deliver the bonds to the Underwriter as provided herein, and (iv) carry out and consummate the transactions contemplated by this Contract of Purchase, the Resolution and the Official Statement. The City has complied, and at the Closing will be in compliance with the terms of the Act and with the obligations it has undertaken in connection with the issuance of the Bonds contained in the Resolution, the Bonds, and this Contract of Purchase; (c) By all necessary official action, the City has duly adopted the Resolution, has duly authorized and approved the Preliminary Official Statement and the Official Statement, has duly authorized and approved the execution and delivery of this Contract of Purchase and the performance by the City of its obligations in connection with the issuance of the Bonds contained in the Resolution and this Contract of Purchase, and the consummation by it of all other transactions contemplated by this Contract of Purchase in connection with the issuance of the Bonds; the Resolution constitutes a legal , valid and binding special obligation of the City, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) ; and the Bonds, when issued, authenticated and delivered to the 3 Underwriter in accordance with the Resolution and this Contract of Purchase, will constitute legal , valid and binding special obligations of the City, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) ; (d) The City is not in material breach of or material default under any applicable constitutional provision, law or administrative regulation of the State of Florida (the "State") or the United States or any applicable judgment or decree, or any loan agreement, indenture, bond, note, or material resolution, agreement or other material instrument to which the City is a party or to which the City or any of its property or assets is otherwise subject and no event has occurred and is continuing which with the passage of time or the giving of notice or both, would constitute a default or event of default under any such constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, or material resolution, agreement or other material instrument; and the execution and delivery of the Bonds, this Contract of Purchase, the adoption of the Resolution and compliance with the provisions on the City's part contained therein, will not conflict with or constitute a breach of or default under any constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture bond, note, resolution, or other instrument to which the City is a party or to which the City or any of its property or assets is otherwise subject, nor will any such execution, delivery, adoption, or compliance result in the creation or imposition of any lien, charge, or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City or under the terms of any such law, regulation or instrument, except as provided by the Bonds and the Resolution; (e) All required authorizations, approvals, licenses, permits, consents and orders of any governmental authority, legislative body, board, agency or commission (which has jurisdiction over such matter) have been duly obtained which are necessary for the due authorization or which would constitute a condition precedent to, or the absence of which would materially adversely affect the due performance by the City of its obligations in connection with the issuance of the Bonds, its obligations under this Contract of Purchase, and its obligations under the Resolution, except for such approvals, consents and orders as may be required under the Blue Sky or securities laws of any state in connection with offering and sale of the Bonds; (f) The descriptions of the Bonds and the Resolution in the Official Statement conform in all material respects to the Bonds and the Resolution; (g) The Bonds, when issued, executed and delivered in accordance with the Resolution and sold to the Underwriter as provided herein, will be validly issued and outstanding special obligations of the City, entitled to the benefits of the Resolution, and upon such issuance, execution and delivery the Resolution will provide for the benefit of the holders from time to time of the Bonds, a legally valid and binding pledge of and lien on the Pledged Funds; 4 (h) As of the date hereof, there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body pending or, to the best knowledge of the officials of the City executing this Contract of Purchase, threatened, against the City, affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Bonds or the collection of the Revenues or the pledge of and lien thereon pursuant to the Resolution, or contesting or affecting as to the City the validity or enforceability of the Act in any respect relating to authorization for the issuance of the Bonds or contesting the exclusion of interest on the Bonds for Federal income tax purposes, or contesting the completeness or accuracy of the Official Statement or any supplement or amendment thereto, or contesting the authority of the City for the issuance of the Bonds, adoption of the Resolution, or the execution and delivery by the City of this Contract of Purchase; (i) The City will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order to (i) qualify the Bonds for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate, and (ii) determine the eligibility of the Bonds for investment under the laws of such states and other jurisdictions, and will use its best efforts to continue such qualifications in effect so long as required for the distribution of the Bonds; provided, however, that the city shall not be required to execute a general or special consent to service of process or qualify to do business in connection with any such qualification or determination in any jurisdiction; (j) As of the date hereof, the information contained in the Preliminary Official Statement and the Official Statement under the headings "Purpose of the Bonds", Description of Certain Sources of Non-ad Valorem Revenues", and " The Project" did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (k) If the Official Statement is supplemented or amended pursuant to Subsection (1 ) of this Section 5, at the time of each supplement or amendment thereto and (unless subsequently again supplemented or amended pursuant to such subsection) at all times subsequent thereto up to and including the Date of Closing referred to in Section 6 hereof, the Official Statement as so supplemented or amended will not contain any untrue statement of a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (1) If between the date of this Contract of Purchase and the Date of Closing referred to in Section 6 hereof, any event shall occur which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the City shall notify the Underwriter thereof and if, in the reasonable opinion of the City, such event requires the 5 preparation and publication of a supplement or amendment to the Official Statement, the City will at its expense supplement or amend the Official Statement, in a form and in a manner approved by the City and the Underwriter, and will supply such amended and/or supplemented copies of the Official Statement to the Underwriter for distribution. 6. At 10:00 a.m. , New York City Time on April 30, 1991, or at such other time or on such earlier or later date upon which we agree, the City will deliver or cause to be delivered to us, at a place upon which we agree, the Bonds in definitive form (all the Bonds to be either lithographed on steel engraved borders or, at the election of the Underwriter, to be typewritten on safety paper, and in either case to bear proper CUSIP numbers) duly executed and authenticated in accordance with the Resolution and shall further deliver at such place the other documents hereinafter mentioned; and the Underwriter will accept such delivery and pay the purchase price of the Bonds as set forth in Section 1 hereof, in Federal funds to the order of the City. This delivery and payment is herein called the "Closing" and the date of such delivery and payment is herein called the "Date of Closing". The Bonds will be made available at least one business day before the Date of Closing at a location to be agreed upon by us. The Bonds to be delivered at Closing shall be prepared and delivered only in fully registrable form. 7. The Underwriter has entered into this Contract of Purchase in reliance upon the representations of the City contained herein, and in reliance upon the representations to be contained in the documents and instruments to be delivered at the Closing and upon the performance by the City of its respective obligations hereunder and thereunder, both as of the date hereof and as of the Date of Closing. Accordingly, the Underwriter's obligations under this Contract of Purchase to purchase, to accept delivery of and to pay for the Bonds are conditioned upon the performance by the City of its obligations to be performed hereunder and under such documents and instruments at or prior to the Closing, and are also subject to the following additional conditions: (a) The representations of the City contained herein shall be true, complete and correct on the date hereof and on and as of the Date of Closing, as if made on the Date of Closing; (b) At the time of the Closing, the Resolution shall be in full force and effect in accordance with their terms and shall not have been amended, modified or supplemented except as mutually agreed since the date of this Contract of Purchase and the Official Statement shall not have been supplemented or amended, except in each such case as may have been agreed to by the Underwriter; (c) At the time of the Closing, all required official action of the City relating to this Contract of Purchase, the Bonds, and the City's approval of the Official Statement shall have been taken and shall be in full force and effect and such documents shall not have been amended, modified or supplemented in any material respect, except in each case as may have been agreed to by the Underwriter; (d) At or prior to the Closing, the Underwriter shall have received 6 copies of each of the following documents: (1) The Official Statement and each supplement or amendment, if any, thereto executed on behalf of the City by the Mayor; (2) The Resolution, certified by the Clerk under the seal as having been duly adopted or enacted by the City Commission and as being in effect, with such supplements or amendments as may have been agreed to by the Underwriter; (3) An opinion, dated the Date of Closing and addressed to the City, of Foley & Lardner, Bond Counsel to the City, in the form as attached to the Official Statement together with a letter of such counsel , dated the Date of Closing and addressed to the Underwriter to the effect that the foregoing opinion, addressed to the City may be relied upon by the Underwriter to the same extent as if such opinion were addressed to the Underwriter; (4) An opinion, dated the Date of Closing and addressed to the Underwriter, of Foley & Lardner, Bond Counsel to the City, to the effect that (i) this Contract of Purchase has been duly authorized, executed and delivered by the City and, assuming due authorization and execution by the Underwriter, constitutes a legal , valid and binding agreement of the City enforceable against the City in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditor's rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and no other authorization is required; and (ii) stating that the statements contained in the Official Statement under the captions "Description of the Bonds," "Security for the Bonds," "Tax Exemption" are correct in all material respects and do not omit any statement which, in their opinion, should be included or referred to therein in order to make the statements contained therein not misleading; (5) An opinion, dated the Date of Closing and addressed to the Underwriter of Foley & Lardner, Attorneys for the City, to the effect that (i) this Contract of Purchase has been duly authorized, executed and delivered by the City and constitutes a binding agreement of the City enforceable in accordance with its terms except to the extent that the enforceability of the rights and remedies set forth herein may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally; (ii) the City has duly authorized, executed and delivered the Official Statement; (iii) the information under the captions "Litigation" and "Disclosure Required by Florida Blue Sky Regulations" is correct in all material respects and does not omit any statement which in their opinion should be included or referred to therein in order to make the statements contained therein not misleading and, in addition, such counsel shall state that, based upon their participation in the preparation of the Official Statement as the Attorneys for the City 7 and without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement (except to the extent expressly set forth in this subparagraph (iii) , as of the Date of Closing nothing has come to their attention causing them to believe that (A) the Official Statement as of its date contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (except for the financial and statistical information contained in the Official Statement, and except for the information under the caption "Tax Exemption", as to all of which no view need be expressed) or (B) the Official Statement (as supplemented or amended pursuant to subsection (m) of Section 5 hereof, if applicable) as of the Date of Closing contains any untrue statement of a material fact or omits to state a material fact required to be stated therein, in the light of the circumstances under which they were made, not misleading (except as aforesaid) ; (iv) the City is not in material breach of or material default under any applicable constitutional provision, law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the City is a party or to which the City or any of its property or assets is subject, nor will the execution, delivery, adoption, enactment, or compliance with any of the documents relating to the Bonds result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City or under the terms of any such law, regulation or instrument, except as expressly provided by the Bonds and the Resolution; (v) at all relevant times the City had the right and power to adopt the Resolution; the Resolution has been duly and lawfully adopted by the City; the Resolution is in full force and effect, and the Resolution constitutes the legal , valid and binding special obligation of the City, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) , and no other authorization is required; (vi) the Bonds are valid and binding special obligations of the City, enforceable in accordance with their terms and the terms of the Resolution, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and are entitled to the benefits of the Resolution; and (vii) all authorizations, consents, approvals and reviews of governmental bodies or regulatory authorities then required for the City's adoption, enactment, execution and performance of and under the Bonds, the Resolution, and this Contract of Purchase have been obtained or effected and, to the best of their knowledge, they have no reason to believe that the City will be unable to obtain or effect any such additional 8 authorization, consent, approval or review that may be required in the future for performance of any of them by the City; and , in addition, they shall give their opinion to the effect set forth under the caption "Litigation" in the Official Statement. (6) A certificate, dated the Date of Closing, signed by the Mayor and the City Clerk, or other appropriate officials satisfactory to the Underwriter to the effect that, to the best of their knowledge; (i) the representations of the City herein are true and correct in all material respects as of the Date of Closing; (ii) the City has performed all obligations to be performed hereunder as of the Date of Closing; (iii) no litigation is pending or, to the best of their knowledge threatened (A) to restrain or enjoin the issuance or delivery of any of the Bonds, (B) in any way contesting or affecting any authority for the issuance of the Bonds or the validity of the Bonds, the Resolution, or this Contract of Purchase, (C) in any way contesting the corporate existence or powers of the City, (D) to restrain or enjoin the collection of the Revenues, (E) which may result in any material adverse change in the business, properties, assets or the financial condition of the City, or (F) asserting that the Official Statement contains any untrue statement of a material fact or omits any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading but, in lieu of such certificate, the Underwriter may in its sole discretion accept an opinion of counsel , acceptable to the Underwriter in form and substance, that in the opinion of counsel , the issues raised in any such pending or threatened litigation are without substance or that the contentions of any plaintiffs therein are without merit) ; (iv) since September 30, 1990 no material adverse change has occurred in the financial position and results of operations of the City except as set forth in or contemplated by the Official Statement; (v) the City has not, since September 30, 1990 incurred any material liabilities other than in the ordinary course of business or as set forth in or contemplated by the Official Statement; and (vi) the Official Statement did not as of its date, and does not as of the Date of Closing, contain any untrue statement of a material fact or omit to state a material fact which should be included therein for the purposes for which the Official Statement is to be used, or which is necessary in order to make the statements contained therein, in light of the circumstances in which they were made, not misleading. (7) A certificate, dated the Date of Closing, signed by the Mayor, City Manager, and the City Clerk, to the effect that, to the best of their knowledge the information set forth under the captions "Introduction," "Security for the Bonds," "The Project," "Litigation," Appendix A in the Official Statement (including any statistical information) , does not contain any untrue statement of a material factor omit any material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading. 9 (8) A Certificate, dated the Date of Closing, signed by the Finance Director and the City Manager to the effect that no material adverse change has occurred in the financial position and results of operations of the City since September 30, 1990 and that the data concerning the Pledged Funds contained in the Official Statement and the information contained in the section entitled "Security for the Bonds" is accurate in all material respects; (9) A letter, dated March 25, 1991 addressed to the Underwriter from McDermit, Davis, Lauteria & Company, P.A. consenting to the use of their opinion on the City's audited financial statements in the Official Statement to the references therein; (10) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Date of Closing, of the City's representations contained herein and of the statements and information contained in the Official Statement and the due performance or satisfaction by the City on or prior to the Date of Closing of all the agreements then to be performed and conditions then to be satisfied by it. All the opinions, letters, certificates, instruments and other documents mentioned above or elsewhere in this Contract of Purchase shall be deemed to be in compliance with the provisions hereof if, but only if, they are in form and substance satisfactory to the Underwriter. The opinion of Foley & Lardner which is referred to in Clause (3) of Subsection (d) of this Section shall be deemed satisfactory provided it is substantially in the form included in the Official Statement as Appendix D. If the City should be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds contained in this Contract of Purchase, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Bonds shall be terminated for any reason permitted by this Contract of Purchase, this Contract of Purchase, shall terminate and neither the Underwriter nor the City shall be under any further obligation hereunder, except that: (i) the proceeds of the Good Faith Check referred to in Section 2 hereof shall immediately be returned to the Underwriter by the City; and (ii) the respective obligations of the City and the Underwriter set forth in Section 10 hereof shall continue in full force and effect. 8. The Underwriter shall have the right to terminate its obligations under this Contract of Purchase to purchase, to accept delivery of, and to pay for, the Bonds by notifying the City of its election to do so if, after the execution hereof prior to the Closing, if the marketability of the Bonds or the market price thereof in the reasonable opinion of the Underwriter, has been materially adversely affected by (i) an amendment to the Constitution of the United States or by any legislation (A) enacted by the United States, (B) recommended to the Congress for passage by the President of the United States, or (C) favorably reported for passage to either House of Congress by any committee of such House to which such legislation has been referred for 10 consideration, or introduced by any member or committee of the Congress, or by any decision of any court of the United States or by any ruling or regulation (final , temporary or proposed) on behalf of the Treasury Department of the United States, the Internal Revenue Service or any other authority of the United States affecting the federal tax status of the City, its property or income or the interest of its Bonds (including the Bonds) ; (ii) an outbreak of war or a national emergency or an escalation occurs with respect to hostilities in which the United States is currently engaged; (iii) there shall have occurred a declaration of a general banking moratorium by any authority of the United States or the states of New York or Florida; or (iv) an event described in Subsection (m) of Section 5 hereof shall have occurred which in the opinion of the Underwriter requires the preparation and publication of a supplement or amendment to the Official Statement. 9. The Underwriter shall be under no obligation to pay, and the City shall pay, any expense incident to the performance of the City's obligations hereunder including, but not limited to: (i) the cost of preparation, printing and delivery of the Preliminary Official Statement and the Official Statement, and any supplement and amendments thereto; (ii) the cost of preparation and printing or typewriting of the Bonds; (iii) the fees and disbursements of Foley & Lardner, Bond Counsel and Attorneys for the City; (iv) any fees due rate consultants, engineers and financial advisors; and (v) the fees and disbursements of McDermit, Davis, Lauteria & Company, P.A. for their services as independent certified public accountants for the City. The Underwriter shall pay the following issuance expenses: (i) the cost of preparation of this Contract of Purchase; and (ii) all other expenses incurred by it in connection with the public offering of the Bonds. The Underwriter has provided to the City the disclosure letter pursuant to Section 218.385 (4) , Florida Statutes, which is attached hereto as Schedule V. 10. Any notice or other communications to be given to the City under this Contract of Purchase may be given by delivering the same in writing signed by an officer of William R. Hough & Co. at your address set forth above and any such notice or other communications to be given to the Underwriter may be given by delivering the same in writing to William R. Hough & Co. , 100 Second Avenue south, Suite 800, St. Petersburg, Florida, 33701. 11. This Contract of Purchase is made solely for the benefit of the City and the Underwriter and no other person, partnership, association or corporation shall acquire or have any right hereunder or by virtue hereof. All representations and agreements of the City in this Contract of Purchase shall remain operative and in full force and effect regardless of any investigation made by on or behalf of the Underwriter and shall survive the delivery of and payment for the Bonds. 12. Notwithstanding any provision herein to the contrary, the performance of any and all obligations of the City hereunder and the performance of any and all conditions contained herein for the benefit of the Underwriter may be waived by the Underwriter, in its sole discretion, and the approval of the Underwriter when required hereunder or the determination of its satisfaction as to any document referred to herein shall be in writing, signed by an appropriate officer 11 or officers of the Underwriter and delivered to you. 13. The approval of the underwriter when required hereunder or the determination of its satisfaction with any document referred to herein shall be in writing signed by a Vice President of William R. Hough & Co. and delivered to you; otherwise, such approval shall be deemed given if the Underwriter accepts delivery of and pays the purchase price for the Bonds at Closing. This Contract of Purchase shall become legally effective upon its acceptance by you, as evidenced by the signature of the Mayor, the City Clerk, and the City Attorney in the spaces provided therefor below. WILLIAM R. HOUGH & CO. Susan F. McGarry, Vice President CITY OF OCOEE, FLORIDA By: Lester Dabbs, Jr. , Mayor Attest: City Clerk s& APPROVED AS TO FORM AND LEGALITY FOR USE AND RELIANCE ONLY BY THE CITY OF OCOEE: A City Attorney 12 , SCHEDULE I City of Ocoee, Florida Capital Ieproveeent Revenue Bonds, Series 1991 Debt Service Schedule Debt Service Fro' 04/01/91 Date Principal Rate Interest Annual D/S 10101/91 90,875.00 90,875,00 10/01/92 65,000 5.400 181,750.00 246,750.00 10/01/93 70,000 5.700 178,240.00 248,240.00 10/01/94 75,000 5.900 174,250.00 249,250.00 10/01/95 80,000 6.100 169,825.00 249,825.00 10/01/96 85,000 6.300 164,945.00 249,945.00 10/01/97 90,000 6.400 159,590.00 249,590.00 10/01/98 95,000 6.500 153,830.00 248,830.00 10/01/99 100,000 6.650 147,655.00 247,655.00 10/01/00 105,000 6.800 141,005.00 246,005.00 10/01/01 115,000 6.900 133,865.00 248,865.00 10/01/02 120,000 7.000 125,930.00 245,930.00 +., �! 1 5� 5� 00 lr,./i;�/�,, 130,000 1.100 �1,,X00,0) 247,,.;0,,,x, 10/01/04 140,000 7,400 108,300.00 248,300.00 10101/05 150,000 7.400 97,940.00 247,940,00 10/01/06 160,000 7.400 86,840.00 246,840.00 10/01/07 170,000 7.500 75,000.00 245,000.00 10/01/08 185,000 7.500 62,250.00 247,250.00 10/01/09 200,000 7.500 48,375.00 248,375.00 10/01/10 215,000 7.500 33,375.00 248,375.00 10/01/11 230,000 7.500 17,250.00 247,250.00 Total 2,580,000 2,468,620.00 5,048,620.00 13 SCHEDULE II Redemption Provisions Optional Redemption The Bonds maturing in the years 1992 to 1999, both inclusive, are not redeemable prior to their stated dates of maturity. The Bonds maturing on and after October 1, 2000 are redeemable prior to their stated dates of maturity, at the option of the City by maturities to be selected by the City and by lot within a maturity if less than a full maturity, in whole on any date on or after October 1, 1999 or in part on any Interest Payment Date on or after October 1, 1999, at a redemption price (expressed as a percentage of the principal amount thereof as set forth in the table below) together with accrued interest to the redemption date, if redeemed in the following periods: Redemption Period Redemption Both Dates Inclusive Price October 1, 1999 to September 30, 2000 102% October 1, 2000 to September 30, 2001 101% October 1, 2001 and thereafter 100% Mandatory Sinking Fund Redemption The Bonds maturing on October 1, 2006 are subject to mandatory sinking fund redemption prior to maturity in part by lot on October 1, 2004 and on each October 1 thereafter, at a redemption price equal to the principal amount thereof and accrued interest thereon to the date fixed for redemption, without premium, from mandatory sinking fund payments through the operation of amortization installments as follows: Principal Year Amount 2004 $ 140,000 2005 150,000 2006(final maturity) 160,000 The Bonds maturing on October 1, 2011 are subject to mandatory sinking fund redemption prior to maturity in part by lot on October 1, 2007 and on each October 1 thereafter, at a redemption price equal to the principal amount thereof and accrued interest thereon to the date fixed for redemption, without premium, from mandatory sinking fund payments through the operation of amortization installments as follows: Principal Year Amount 2007 $ 170,000 2008 185,000 2009 200,000 2010 215,000 2011(final maturity) 230,000 14