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Res 61-04 RESOLUTION NO. 61-04 CITY OF DELRAY BEACH, FLORIDA General Obligation Bonds, Series 2004 (Recreational and Cultural Projects) General Obligation Bond Resolution Adopted September 7, 2004 WPI3-FSl~505506v09\16787.011300 Resolution No. 61-04 TABLE OF CONTENTS SECTION 2. FINDINGS ......................................................................................................... 8 SECTION 3. AUTHORITY OF THIS RESOLUTION .......................................................... 9 SECTION 4. RESOLUTION CONSTITUTES CONTRACT ................................................ 9 SECTION 5. AUTHORIZATION AND DESCRIPTION OF BONDS ................................. 9 SECTION 6. REDEMPTION PROVISIONS ....................................................................... 11 SECTION 7. EXECUTION OF BONDS .............................................................................. 12 SECTION 8. NEGOTIABILITY, REGISTRATION AND CANCELLATION .................. 13 SECTION 9. BONDS MUTILATED, DESTROYED, STOLEN OR LOST ....................... 15 SECTION 10. FORM OF BONDS .......................................................................................... 16 SECTION 11. APPLICATION OF BOND PROCEEDS ....................................................... 26 SECTION 12. SECURITY FOR THE BONDS ...................................................................... 28 SECTION 13. COVENANTS OF THE CITY ........................................................................ 28 SECTION 14. RULE 15c2-12 UNDERTAKING ................................................................... 34 SECTION 15. BOOK-ENTRY SYSTEM ............................................................................... 39 SECTION 16. MODIFICATION OR AMENDMENT ........................................................... 41 SECTION 17. SEVERABILITY OF INVALID PROVISIONS ............................................. 42 SECTION 18. SALE OF BONDS ........................................................................................... 42 SECTION 19. BOND ANTICIPATION NOTES ................................................................... 42 SECTION 20. PRELIMINARY OFFICIAL STATEMENT AND NOTICE OF SALE ........ 43 SECTION 21. REMEDIES ...................................................................................................... 43 SECTION 22. EFFECTIVE DATE ......................................................................................... 43 WPB-FSIXS05506v09\16787.011300 i Resolution No. 61-04 Resolution No. 61-04 A RESOLUTION OF THE CITY COMMISSION OF DELRAY BEACH, FLORIDA, AUTHORIZING THE ISSUANCE OF NOT EXCEEDING $24,000,000 IN THE INITIAL AGGREGATE PRINCIPAL AMOUNT OF CITY OF DELRAY BEACH, FLORIDA GENERAL OBLIGATION BONDS, SERIES 2004 (RECREATIONAL AND CULTURAL PROJECTS); PROVIDING FOR ALLOCATION OF THE PROCEEDS OF SUCH BONDS CONSISTENT WITH RESOLUTION NO. 72-03; PROVIDING THE FORM AND TERMS OF THE BONDS; PROVIDING FOR THE PAYMENT OF THE BONDS FROM A TAX ON ALL TAXABLE PROPERTY IN THE CITY OF DELRAY BEACH; PROVIDING FOR THE UNDERTAKING BY THE CITY REGARDING SECONDARY MARKET DISCLOSURE AS REQUIRED BY RULE 15c2-12 OF THE SECURITIES AND EXCHANGE COMMISSION; PROVIDING FOR THE RIGHTS, REMEDIES AND SECURITY OF THE HOLDERS OF THE BONDS; PROVIDING FOR CERTAIN OTHER MATTERS DEEMED NECESSARY AND PROPER IN CONNECTION WITH THE ISSUANCE OF THE BONDS; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Commission of Delray Beach, Florida (the "Commission"), did, on October 21, 2003, adopt Resolution No. 72-03 entitled "A RESOLUTION OF THE CiTY COMMISSION OF THE CITY OF DELRAY BEACH, PROVIDING FOR THE ISSUANCE OF GENERAL OBLIGATION BONDS FOR THE PURPOSE OF FINANCING THE (A) ACQUISITION OF LAND, THE CONSTRUCTION AND EQUIPPING OF UP TO THREE NEW NEIGHBORHOOD PARKS, THE CONSTRUCTION AND EQUIPPING OF A SOCCER COMPLEX; THE CONSTRUCTION, RECONSTRUCTION AND EQUIPPING OF CERTAIN EXISTING PARKS THROUGHOUT THE CITY IN THE PRINCIPAL AMOUNT NOT EXCEEDING $9,000,000; (B) ACQUISITION OF LAND, THE CONSTRUCTION AND EQUIPPING OF A NEW RECREATION CENTER IN THE WESTERN AREA OF THE CITY, AND THE CONSTRUCTION AND/OR RECONSTRUCTION OF IMPROVEMENTS TO AND EQUIPPING OF CERTAIN EXISTING RECREATION CENTERS IN THE WPB-FSlXS05506v09\I6787.011300 Resolution No. 61-04 PRINCIPAL AMOLrNT NOT EXCEEDING $7,000,000; (C) ACQUISITION OF LAND, CONSTRUCTION OF A PARKING GARAGE AND OTHER CAPITAL IMPROVEMENTS ' AS PART OF THE EXPANSION OF OLD SCHOOL SQUARE IN THE PRINCIPAL AMOUNT NOT EXCEEDING $7,000,000; AND (D) ACQUISITION OF FURNISHINGS AND FIXTURES FOR THE NEW LIBRARY IN THE PRINCIPAL AMOUNT NOT TO EXCEED $1,000,000; CALLING FOR A BOND REFERENDUM OF THE QUALIFIED VOTERS IN THE CITY OF DELRAY BEACH TO BE HELD JANUARY 20, 2004, AS TO WHETHER GENERAL OBLIGATION BONDS FOR SUCH PROJECTS SHOULD BE ISSUED; AND PROVIDING AN EFFECTIVE DATE" (the "Referendum Resolution"), and the qualified electors of the City of Delray Beach, Florida (the "City"), did, at an election held on January 20, 2004 (the "Referendum"), authorize by majority vote the issuance of $24,000,000 general obligation bonds to finance the cost of the acquisition and construction of the projects described above in the respective principal amounts set forth in the Referendum Resolution and as described below (the "Projects"). WHEREAS, the Commission hereby determines it to be in the best financial and economic interest of the City to issue its City of Delray Beach, Florida, General Obligation Bonds, Series 2004 (Recreational and Cultural Projects) (the "Bonds"), in the initial aggregate principal amount of not exceeding $24,000,000 to finance the acquisition and construction of the Projects in the manner provided herein; and W}IEREAS, effective July 3, 1995, Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission ("SEC"), provides that it is unlawful for a broker dealer or municipal WPB-FSIXS05506v09\16787.011300 2 Resolution No. 61-04 securities dealer to purchase or sell municipal securities, which includes the Bonds, unless the issuer, which includes the City, has undertaken in a written agreement (herein, the "Undertaking") to provide to specified information repositories annual financial information and operating data relevant to the municipal securities and notice of certain specified material events; and WHEREAS, the Commission hereby determines to provide its Undertaking with respect to the Bonds in this Resolution; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA: SECTION 1. DEFINITIONS. That, in addition to the terms defined above, as used in this Resolution, the following terms shall have the following meanings unless the text otherwise expressly requires: "Act" shall mean the Florida Constitution, Chapter 166, Florida Statutes, as amended and supplemented, the City Charter of Delray Beach, as amended and supplemented, and other applicable provisions of law. "Beneficial Owner" shall mean, except with respect to any secondary market disclosure requirements relating to the Bonds as described in Section 14 herein, during any period the Bonds are registered under the Book-Entry System, any purchaser of a Bond and others who acquire a beneficial ownership interest in a Bond held by the Securities Depository. In determining the Beneficial Owner of any Bond, the City, the Paying Agent and the Registrar may rely exclusively upon written representations made, and information given to the City, the WPB-FSDS05506v09\16787.011300 3 Resolution No. 61-04 Paying Agent or the Registrar by the Securities Depository or its Participants with respect to any Bond held by the Securities Depository in which a beneficial ownership interest is claimed. With respect to Replacement Bonds, the City, the Paying Agent and the Registrar shall consider the owner of any such Replacement Bond as registered on the registration books of the City maintained by the Registrar to be the Beneficial Owner thereof. "Bond Insurance Policy" shall mean an insurance policy issued for the benefit of the Holders of any Bonds, pursuant to which the Bond Insurer shall be obligated to pay when due the principal of and interest on such Bonds to the extent of any deficiency in the amounts in the funds and accounts held under this Resolution, in the manner and in accordance with the terms provided in such Bond Insurance Policy. "Bond Insurer" shall mean the issuer of a Bond Insurance Policy and its Successors. "Bondholder" or "Holder of Bonds" or "Owner" or any similar term, shall mean any person who shall be the registered owner of any Bond or Bonds Outstanding under the terms of this Resolution. "Bonds" shall mean the not exceeding in initial aggregate principal amount $24,000,000 General Obligation Bonds, Series 2004 (Recreational and Cultural Projects), authorized to be issued pursuant to this Resolution. "Book-Entry System" shall mean the system under which the City may issue the Bonds and maintain the registration for such Bonds in book-entry form only. WPB-FSlXS05506v09\16787.011300 4 Resolution No. 61-04 "Code" shall mean the Internal Revenue Code of 1986, as amended, and all subsequent tax legislation duly enacted by the Congress of the United States. Each reference to a section of the Code herein shall be deemed to include, if applicable, final, temporary or proposed regulations, revenue rulings and proclamations issued or amended with respect thereto, and any final, temporary or proposed regulations and revenue rulings and procedures promulgated under the Internal Revenue Code of 1954, as amended, by the Treasury Department or Internal Revenue Service of the United States. "Defeasance Obligations" shall mean to the extent permitted by law and the Bond Insurer: (a) U.S. Obligations; (b) Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state (i) which are not callable prior to maturity or as to which irrevocable instructions have been given to the trustee of such bonds or other obligations by the obligor to give due notice of redemption and to call such bonds for redemption on the date or dates specified in such instructions, (ii) which are secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described in clause (a) hereof which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the redemption date or dates specified in the irrevocable instructions referred to in subclause (i) of this clause (b), as appropriate, and (iii) as to which the principal of and interest wPB-Fs1Ls05506v09\16787,011300 5 Resolution No. 61-04 on the bonds and obligations of the character described in clause (a) hereof which have been deposited in such fund along with any cash on deposit in such fund are sufficient to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this clause (b) on the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subclause (i) of this clause (b), as appropriate; (c) Evidences of indebtedness issued by the Federal Home Loan Banks, Federal Home Loan Mortgage Corporation (including participation certificates), Federal Financing Banks, or any other agency or instrumentality of the United States of America created by an act of Congress provided that the obligations of such agency or instrumentality are unconditionally guaranteed by the United States of America or any other agency or instrumentality of the United States of America or of any corporation wholly-owned by the United States of America; and (d) Evidences of ownership of proportionate interests in future interest and principal payments on obligations described in (a) held by a bank or trust company as custodian. "NRMSIR" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. A list of the names and addresses of each of the current NRMSIR may be obtained by calling the United States Securities and Exchange Commission's Fax on Demand Service from a fax machine phone line at (202) 942-8088 and requesting document numbers 0206 and 0207, respectively, or by visiting its website at http://www.sec, gov/info/municipal/nrmsir.htm. WPB-FSIXS05506v09\16787.011300 6 Resolution No. 61-04 "Outstanding" shall mean, when used with reference to the Bonds, as of any particular date, all Bonds theretofore, or thereupon being, authenticated and delivered by the Registrar under this Resolution, except (i) Bonds theretofore or thereupon cancelled by the Registrar or surrendered to the Registrar for cancellation; (ii) Bonds with respect to which all liability of the City shall have been discharged in accordance with Section 13.D of this Resolution; (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Registrar pursuant to any provision of this Resolution; (iv) Bonds cancelled after purchase in the open market or because of payment at, or redemption prior to maturity; and (v) Bonds held by the City. "Participants" shall mean brokers, dealers, banks and other financial institutions and other persons for whom, from time to time, the Securities Depository effects book-entry transfers and pledges of securities deposited with the Securities Depository. "Paying Agent" shall mean the Finance Director of the City or his designee or such bank or trust company and any successor bank or trust company appointed by the City to act as Paying Agent hereunder. "Permitted Investments" shall mean (i) U. S. Obligations, and (ii) all other investments permitted under the laws of Florida and acceptable to the Bond Insurer, if any. "Registrar" shall mean the Finance Director of the City or his designee or such bank or trust company and any successor bank or trust company appointed by the City to act as Registrar hereunder. WPB-FSBS05506v09\I6787.011300 7 Resolution No. 61-04 "Replacement Bonds" shall mean certificated Bonds authenticated and delivered pursuant to Section 15 of this Resolution, when the City discontinues the Book-Entry System. "Securities Depository" shall mean, with respect to the Bonds to be issued in book entry form, The Depository Trust Company and its successors and assigns, or a successor clearing agency designated pursuant to Section 15 hereof and its successors and assigns. "Tax Certificate" shall mean the Arbitrage Certificate executed by the City on the date of initial issuance and delivery of the Bonds, as such Tax Certificate may be amended from time to time, a source of guidance for achieving compliance with the Code. "U. S. Obligations" shall mean the direct obligations of, or obligations the timely payment of principal of and interest on which are unconditionally guaranteed by, the United States of America, and, if determined by subsequent proceedings of the Commission, certificates which evidence ownership of the right to the payment of the principal of, or interest on, such obligations. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Words importing the singular number shall include the plural number and vice versa unless the context shall otherwise indicate. The word "person" shall include corporations; associations, natural persons and public bodies unless the context shall otherwise indicate. Reference to a person other than a natural person shall include its Successors. SECTION 2. FINDINGS. WPB-FSl~505506v09\I6787.011300 8 Resolution No. 61-04 A. That it is necessary, advantageous, desirable and in the best interests of the City and its residents that the Bonds be issued to finance the acquisition and construction of the Projects in the respective principal amounts authorized under the Referendum Resolution. B. That the Bonds may be issued either all at one time or in part from time to time as the Commission may in its discretion hereafter determine by subsequent resolution. SECTION3. AUTItORITY OF TItIS RESOLUTION. This Resolution is adopted pursuant to the Act. SECTION 4. RESOLUTION CONSTITUTES CONTRACT. In consideration of the acceptance of the Bonds, authorized to be issued hereunder by those who shall hold the same from time to time, the Resolution shall be deemed to be and shall constitute a contract between the City and such Bondholders, and the covenants and agreements herein set forth to be performed by the City shall be for the equal benefit, protection and security of the Holders of any and all of such Bonds, all of which shall be of equal rank and without preference, priority, or distinction of any of the Bonds over any other thereof except as expressly provided therein and herein. SECTION 5. AUTHORIZATION AND DESCRIPTION OF BONDS. Subject and pursuant to the provisions of this Resolution, Bonds of the City to be known as "General Obligation Bonds, Series 2004 (Recreational and Cultural Projects)," are hereby authorized to be issued in the initial aggregate principal amount of not exceeding Twenty Four Million Dollars ($24,000,000) for the purpose of financing all or a portion of the costs of acquisition and construction and equipping of the Projects pursuant to the provisions of this Resolution in the WPB-FSl~505506v09\I6787.011300 9 Resolution No. 61-04 principal amounts allocated pursuant to the terms and provisions of the Referendum Resolution and to pay the cost of issuance of the Bonds. The Bonds shall be issued in registered form, shall be in the denomination of $5,000 each, or any integral multiple thereof, and shall be numbered separately and consecutively upward. The Bonds shall be designated "General Obligation Bonds, Series 2004 (Recreational and Cultural Projects)," with such other designation deemed appropriate and determined by subsequent proceeding of the Commission, shall bear interest at not exceeding the maximum rate or rates permitted by law, payable by check or draft made payable to the Holder of Bonds and mailed to the address of such Holder of Bonds as such name and address shall appear on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day of the calendar month preceding each interest payment date (which unless determined otherwise by subsequent proceedings of the Commission, shall be the first day of February and August) or on the date the principal sum of any Bond is paid (herein, the "Record Date"); provided, however, that payment of interest on the Bonds may, at the option of any Holder of Bonds in an aggregate principal amount of at least $1,000,000, be transmitted by wire transfer to the designated account number of such Holder of any Bonds within the continental United States on file with the Paying Agent as of the Record Date. The Bonds may be issued as either serial Bonds or term Bonds or any combination thereof. The Bonds authenticated prior to the first interest payment date shall be dated and bear interest from the date determined by subsequent proceedings of the Commission. Bonds authenticated on or subsequent to the first interest payment date shall be dated as of the date of their registration and shall bear interest as of the interest payment date immediately preceding the date of registration, WPB-FS 1~505506v09\16787.011300 10 Resolution No. 61-04 unless such date of registration shall be an interest payment date, in which case, such Bonds shall bear interest from such date of registration, or if registered during the period from a Record Date preceding an interest payment date to such interest payment date, then from such interest payment date if interest is then paid, as the case may be; provided, however, that if and to the extent there is a default in the payment of the interest due on such interest payment date, such defaulted interest shall be paid to the persons in whose name Bonds are registered on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day prior to a subsequent interest payment date established by notice mailed by the Registrar to the registered owner not less than the tenth day preceding such subsequent interest payment date, such interest shall be payable semiannually of each year, and shall mature in such years and amounts, all as shall be determined by subsequent proceedings of the Commission. In the event any payment of interest or of interest and principal on the Bonds shall not be paid when due, the amount so in default shall continue to bear interest to the extent permitted by law from the date such payment became due until payment thereof at the rate set forth on the face of each Bond. Such Bonds shall mature in such amounts and at such times not exceeding twenty (20) years from the date of issuance of the Bonds, and shall be payable and registrable at such place or places within or out of the State of Florida as shall hereafter be determined by subsequent proceedings of the Commission. SECTION6. REDEMPTION PROVISIONS. The Bonds may be subject to redemption prior to maturity at such times, at such redemption prices and upon such terms as shall be determined by subsequent proceedings of the Commission. WPB-FSI~505506v09\16787.011300 1 1 Resolution No. 61-04 SECTION 7. EXECUTION OF BONDS. That the Bonds shall be executed in the name of the City by the Mayor, and the official seal of the City shall be affixed thereto or lithographed, impressed, imprinted or otherwise reproduced thereon and attested by the City Clerk, or in such manner as may be permitted by law. The signatures of the Mayor or the City Clerk on the Bonds may be manual or facsimile signature. In case any one or more of the officers who shall have signed or sealed any of the Bonds shall cease to be such officer before the Bonds so signed and sealed have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. Any of the Bonds may be signed and sealed on behalf of the City by such person as at the actual time of execution of such Bonds shall hold the proper office, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The Bonds shall bear thereon a certificate of registration and authentication, in the form set forth in Section 10 hereof, executed manually by the Registrar. Only such Bonds as shall bear thereon such certificate of registration and authentication shall be entitled to any right or benefit under this Resolution and no Bond shall be valid or obligatory for any purpose until such certificate of registration and authentication shall have been duly executed by the Registrar. Such certificate of the Registrar upon any Bond executed on behalf of the City shall be conclusive evidence that the Bond so authenticated has been duly registered and authenticated and delivered under this Resolution and that the holder thereof is entitled to the benefits of this Resolution. WPB-FSBS05506v09\16787.011300 12 Resolution No. 61-04 SECTION 8. NEGOTIABILITY, REGISTRATION AND CANCELLATION. Subject to the provisions of Section 15 hereof, at the option of the registered holder of any Bond and upon surrender thereof at the designated corporate trust office of the Registrar, with a written instrument of transfer satisfactory to the Registrar duly executed by the registered holder of a Bond or his duly authorized attorney and upon payment by such holder of any charges which the Registrar or the City may make as provided in this Section, the Bonds may be exchanged for Bonds of the same series and maturity of any other authorized denominations. The Registrar shall keep books for the registration of Bonds and for the registration of transfers of Bonds. The Bonds shall be transferable by the registered holder thereof in person or by his attorney duly authorized in writing only upon the books of the City kept by the Registrar and only upon surrender thereof together with a written instrument of transfer satisfactory to the Registrar duly executed by the registered holder or his duly authorized attorney. Upon the transfer of any such Bond, the City shall issue in the name of the transferee a new Bond or Bonds. The City, the Registrar and the Paying Agent shall deem and treat the person in whose name any Bond shall be registered upon the books kept by the Registrar as the absolute holder of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, premium, if any, and interest on such Bond as the same become due and for all other purposes. All such payments so made to any such holder or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the WPB-FSlXS05506v09\16787.011300 1 3 Resolution No. 61-04 extent of the sum or sums so paid, and neither the City, the Registrar nor the Paying Agent shall be affected by any notice to the contrary. Subject to the provisions of Section 15 hereof, in all cases in which the privilege of exchanging Bonds or transferring Bonds is exercised, the City shall execute and the Registrar shall authenticate and deliver Bonds in accordance with the provisions of this Resolution. All Bonds surrendered in any such exchanges or transfers shall forthwith be delivered to the Registrar and cancelled by the Registrar in the manner provided in this Section. There shall be no charge for any such exchange or transfer of Bonds, but the City or the Registrar may require the payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Neither the City nor the Registrar shall be required (a) to transfer or exchange Bonds for a period commencing on the Record Date and ending on the next ensuing interest payment date for such Bonds or 15 days next preceding any selection of Bonds to be redeemed or thereafter until aiter the mailing of any notice of redemption; or (b) to transfer or exchange any Bonds called for redemption. However, if less than all of a Bond is redeemed or defeased, the City shall execute and the Registrar shall authenticate and deliver, upon the surrender of such Bond, without charge to the Bondholder, for the unpaid balance of the principal amount of such Bond so surrendered, a registered Bond in the appropriate denomination. All Bonds paid or redeemed, either at or before maturity shall be delivered to the Registrar when such payment or redemption is made, and such Bonds, together with all Bonds that may be purchased by the City, shall thereupon be promptly cancelled. Bonds so cancelled WPB~FSDS05506v09\16787.011300 14 Resolution No. 61-04 may at any time be destroyed by the Registrar, who shall execute a certificate of destruction in duplicate by the signature of one of its authorized officers describing the Bonds so destroyed, and one executed certificate shall be filed with the City and the other executed certificate shall be retained by the Registrar. SECTION 9. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated, destroyed, stolen or lost, the City may execute and the Registrar shall authenticate and deliver a new Bond of like date, maturity, denomination and interest rate as the Bond so mutilated, destroyed, stolen or lost; provided that, in the case of any mutilated Bond, such mutilated Bond shall first be surrendered to the City and, in the case of any lost, stolen or destroyed Bond, there shall first be furnished to the City and the Registrar evidence of such loss, the~, or destruction satisfactory to the City and the Registrar, together with indemnity satisfactory to them. In the event any such Bond shall be about to mature or have matured or have been called for redemption, instead of issuing a duplicate Bond, the City may pay the same without surrender thereof. The City and the Registrar may charge the holder of such Bond their reasonable fees and expenses in connection with this transaction. Any Bond surrendered for replacement shall be cancelled in the same manner as provided in Section 8 of this Resolution. Any such duplicate Bonds issued pursuant to this Section shall constitute additional contractual obligations on the part of the City, 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 WPB-FS 1XS05506v09\16787.011300 1 5 Resolution No. 61-04 proportionate benefits and rights as to lien on and source and security for payment with all other Bonds issued hereunder. SECTION 10. FORM OF BONDS. The text of the Bonds shall be of substantially the following tenor, with such omissions, insertions and variations as ma.v be necessary and desirable: WPB-FSlXS05506v09\I6787.011300 16 Resolution No. 61-04 (Face of Bond) No. $ ,000 UNITED STATES OF AMERICA STATE OF FLORIDA PALM BEACH COUNTY CITY OF DELRAY BEACH GENERAL OBLIGATION BOND SERIES 2004 (Recreational and Cultural Projects) Interest Rate Maturity Date Dated Date CUSIP Registered Owner: Principal Amount: KNOW ALL MEN BY THESE PRESENTS, that City of Delray Beach, Florida, a municipal corporation created and existing under and by virtue of the laws of the State of Florida (the "City"), hereby acknowledges itself to be indebted, and for value received, hereby promises to pay the Registered Owner or registered assigns on the Maturity Date specified above, from the sources hereinafter mentioned, upon the presentation and surrender hereof at the designated corporate trust office of as paying agent (said and any other bank or trust company becoming successor paying agent being herein called the "Paying Agent"), the Principal Amount stated above together with interest thereon at the Interest Rate payable on the first day of and of WPB-FSl~505506v09\16787.011300 17 Resolution No. 61-04 each year commencing Interest on this Bond (except for Holders of at least $1,000,000 in aggregate principal amount of bonds, who may receive payment of interest by wire transfer in the manner provided in the herein referred to Resolution) is payable by check or draft of the Paying Agent made payable to the Registered Owner and mailed to the address of the Registered Owner as such name and address shall appear on the registration books of the City initially maintained by , as registrar (said and any other bank or trust company becoming successor registrar being herein called the "Registrar") at the close of business on the fifteenth day of the calendar month preceding each interest payment date or the date on which the principal of a Bond is to paid (the "Record Date"); provided, however, that if and to the extent there is a default in the payment of the interest due on such interest payment date, such defaulted interest shall be paid to the persons in whose name Bonds are registered on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day prior to a subsequent interest payment date established by notice mailed by the Registrar to the registered owner not less than the tenth day preceding such subsequent interest payment date. Such, interest shall be payable from the most recent interest payment date next preceding the date of registration to which interest has been paid, unless the date of registration is an 1 or 1 to which interest has been paid, in which case from the date of registration, or unless the date of registration is prior to ,200_, in which case from ,200_, or unless the date of registration is between a Record Date and the next succeeding interest payment date, in which case from such interest payment date. The Principal Amount and accrued interest thereon is payable in any coin WPB-FSlXSO5506v09\16787.011300 18 Resolution No. 61-04 or currency of the United States of America, which, on the date of payment thereof, shall be legal tender for the payment of public and private debts. This bond is one of an issue of bonds in the aggregate principal amount of not exceeding $ ., of like date, tenor and amount, except as to the number, date of maturity and interest rate, issued by the City, for the purpose of financing the costs of all or a portion of certain recreational and cultural projects within the City under the authority of and in full compliance with the Constitution and statutes of the State of Florida, including Chapter 166, Florida Statutes, as amended and supplemented, the City Charter of Delray Beach, as amended and supplemented, and other applicable provisions of law and pursuant to a resolution (the "Resolution") duly adopted by the City Commission of Delray Beach, Florida, authorizing the issuance of the bonds. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of this bond, exist, have happened and have been performed in regular and due form and time as required by the laws and Constitution of the State of Florida applicable thereto, and that the issuance of this bond and of the bonds of the issue of which this bond is one does not violate any constitutional or statutory debt limitation or provision; that due provision has been made for the levy and collection of a direct annual tax in addition to all other taxes, upon all the taxable property within the City sufficient to pay the principal of and interest on said bonds as the same shall mature and become due, and that the full faith and credit of Delray Beach, Florida, are hereby irrevocably pledged WPB-FSl~505506v09\16787.011300 19 Resolution No. 61-04 for the punctual payment of the principal of and interest on this bond, as the same shall become due and payable. IN WITNESS WHEREOF, Delray Beach, a municipal corporation of the State of Florida, has caused this bond to be signed by its Mayor either manually or with his facsimile signature, and the seal of said City or a facsimile thereof, to be affixed hereto; or lithographed, impressed, imprinted or otherwise reproduced hereon, attested by the City Clerk of said City- either manually or with her facsimile signature, all as of the Dated Date. (SEAL) CITY OF DELRAY BEACH, FLORIDA Mayor ATTEST: City Cl~k YqPB-FSl~505506v09\16787.011300 20 Resolution No. 61-04 (FORM OF CERTIFICATE OF REGISTRATION AND AUTHENTICATION) This bond is one of the bonds delivered pursuant to the within mentioned Resolution of the City Commission of Delray Beach, Florida. Date of Authentication: as Registrar By: Authorized Officer WPB-FSDS05506v09\16787.011300 21 Resolution No. 61-04 (Back of Bond) (Insert Applicable Redemption Provisions) The original registered owner, and each successive registered owner of this bond shall be conclusively deemed to have agreed and consented to the following terms and conditions: (1) The Registrar shall keep books for the registration of bonds and for the registration of transfers of bonds as provided in the Resolution. The bonds shall be transferable by the registered owner thereof in person or by his attorney duly authorized in writing only upon the books of the City kept by the Registrar and only upon surrender hereof together with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney. Upon the transfer of any such bond, the City shall issue in the name of the transferee a new bond or bonds. (2) The City, the Paying Agent and the Registrar shall deem and treat the person in whose name any bond shall be registered upon the books kept by the Registrar as the absolute owner of such bond, whether such bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such bond as the same becomes due, and for all other purposes. All such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such bond to the extent of the stun or sums so paid, and neither the City, the Paying Agent, nor the Registrar shall be affected by any notice to the contrary. (3) At the option of the registered owner thereof and upon surrender hereof at the designated corporate trust office of the Registrar with a written instrument of transfer satisfactory WPB-FSlXS05506v09\16787.011300 22 Resolution No. 61-04 to the Registrar duly executed by the registered owner or his duly authorized attorney and upon payment by such registered owner of any charges which the Registrar or the City may make as provided in the Resolution, the bonds may be exchanged for bonds of the same series and maturity of any other authorized denominations. (4) In all cases in which the privilege of exchanging bonds or transferring bonds is exercised, the City shall execute and the Registrar shall authenticate and deliver bonds in accordance with the provisions of the Resolution. There shall be no charge for any such exchange or transfer of bonds, but the City or the Registrar may require payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Neither the City nor the Registrar shall be required (a) to transfer or exchange bonds for a period commencing on a Record Date and ending on the next ensuing interest payment date for such bonds or 15 days next preceding any selection of bonds to be redeemed or thereafter until after the mailing of any notice of redemption; or (b) to transfer or exchange any bonds called for redemption. However, if less than all of a Bond is redeemed or defeased, the City shall execute and the Registrar shall authenticate and deliver, upon the surrender of such Bond, without charge to the Bondholder, for the unpaid balance of the principal amount of such Bond so surrendered, a registered Bond in the appropriate denomination. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Resolution until the certificate of registration and authentication hereon shall have been signed by an authorized officer of the Registrar. WPB-FS1LS05506v09\I6787.011300 23 Resolution No. 61-04 WPB-FS 1 ~505506v09\16787.01 ! 300 24 Resolution No. 61-04 ASSIGNMENT AND TRANSFER FOR VALUE RECEWED the undersigned sells, assigns and transfers unto (please print or typewrite name and address of transferee) the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints Attorney to transfer the within' bond on the books kept for registration thereof, with full power of substitution in the premises. Dated: In the presence off [STATEMENT OF INSURANCE, IF ANY] WPB-FSBS05506v09\I6787.011300 25 Resolution No. 61-04 SECTION 11. APPLICATION OF BOND PROCEEDS. The accrued interest derived from the sale of the Bonds, if any, shall be deposited in the Interest Account, hereinafter created and established and used for the purpose o£paying the interest on the Bonds as the same becomes due and payable. The remaining proceeds of such sale shall be deposited in the Capital Projects Fund hereby created and established and used for the purpose of ftnancing all or a portion of the costs of the Projects including all costs and expenses relating and incidental thereto and all costs and expenses as may be necessary or incidental and incurred by the City in connection with the issuance of the Bonds. There is also hereby created and established a Costs of Issuance Account within the Capital Projects Fund which will be held by the City and funded with a portion of the moneys on deposit in the Capital Projects Fund in the amount determined by the City's Finance Director. Moneys on deposit in the Cost of Issuance Account shall be used to pay any legal expenses, expenses for fiscal agents or financial services, and such other expenses as may be necessary or incidental and incurred by the City in connection with the issuance of the Bonds. During the period the moneys on deposit in the Capital Projects Fund have not been applied as contemplated above, any earnings from moneys held in the Capital Projects Fund invested pursuant to the requirements of this Resolution shall be retained in the Capital Projects Fund. Amounts on deposit in the Capital Projects Fund shall be invested by the City in Permitted Investments maturing not later than the dates such moneys will be needed for its intended purpose. WPB-FSlXS05506v09\16787.011300 26 Resolution No. 61-04 Each of the Projects shall consist of various components (herein referred to as a "Component" or "Components'). The Components comprising each of the Projects, with the estimated costs for each are more fully described in an exhibit attached to the Referendum Resolution and by this reference incorporated herein. Notwithstanding the principal amounts assigned to each Component, the actual cost of a particular Component may be greater or less than the estimated cost allocated to such Component. If the actual cost of a Component is greater than the amount allocated to the Referendum Resolution, the City may provide for such deficiency fi.om other available funds or from surplus funds that had been allocated to another Component of the same Project. If the actual Cost of a Component is less than that allocated in the Referendum Resolution, the City may use such surplus for other Components of the same Project If, after application of the foregoing, there remain insufficient funds to complete a Component due to unforeseen cost escalations or failure to receive anticipated governmental grants or private contributions, or other unexpected circumstances, the City may delete a part of such Component or modify such Component so that such Component may be completed. The City will not delete any Component to generate surplus moneys for other Components, nor will it expend Bond proceeds in excess of the amounts allocated to each of the Projects set forth in the exhibit attached to the Referendum Resolution. Upon certification in writing by the City Manager that the Projects have been completed, any money remaining in the Capital Projects Fund, in the discretion of the City, may be used in any manner which, in the opinion of Bond Counsel to the City, will not adversely affect the WPB-FSlXS05506v09\16787.011300 27 Resolution No. 61-04 exclusion of interest on the Bonds fi.om gross income for federal income tax purposes. If not otherwise used or said opinion is not delivered, said money remaining in the Capital Projects Fund shall be deposited into the Principal Account and Interest Account in the Sinking Fund and used solely for purposes thereof. The proceeds of the sale of the Bonds shall be and constitute trust funds for the purposes hereinabove provided and there is hereby created a lien upon such moneys, until so applied, in favor of the Holders of said Bonds. SECTION 12. SECURITY FOR THE BONDS. That in each year while any of the Bonds are outstanding and unpaid, there shall be levied and collected a tax on all the taxable property within the City sufficient in an amount to pay the interest on the Bonds as it becomes due, and to provide for the payment of the principal of said Bonds at their maturity or earlier redemption, and the City is, and shall be irrevocably and unconditionally obligated to levy and collect such ad valorem taxes without limitation as to rate or amount on all the taxable property within the City, sufficient in amount to pay all principal of and interest on said Bonds, as the same shall become due. SECTION 13. COVENANTS OF THE CITY. As long as any of the principal of or interest on any of the Bonds shall be Outstanding and unpaid, or until there shall have be~n set apart in the Sinking Fund, consisting of the Interest Account and Principal Account, herein created and established, a sum sufficient to pay, when due, the entire principal of the Bonds remaining unpaid, together with interest accrued and to accrue thereon, or until the provisions of WPB-FSl~505506v09\16787.011300 28 Resolution No. 61-04 Section 13.D of this Resolution have been complied with, the City covenants with the Holders of any and all of the Bonds issued pursuant to the Resolution as follows: A. TAX COVENANT. 1. The City covenants to comply with each requirement of the Code, and any successor provisions thereto, necessary to maintain the exclusion of the interest on the Bonds from gross income for federal income tax purposes pursuant to Section 103(a) of the Code. In furtherance of the covenant contained in the preceding sentence, the City agrees to comply with the provisions of the Tax Certificate. 2. The City shall make any and all payments required to be made to the United States Department of the Treasury in connection with the Bonds pursuant to Section 148(0 of the Code from amounts on deposit in the fund and accounts established under this Resolution and available therefor. 3. Notwithstanding any other provision of this Resolution to the contrary, as long as necessary in order to maintain the exclusion of interest on the Bonds from gross income for federal income tax purposes, the covenants contained in this Section shall survive the payment of the Bonds, including any payment or defeasance thereof pursuant to Section 13.D of this Resolution. B. AD VALOREM TAX. In each year, while any of the Bonds are outstanding and unpaid, the City covenants that there shall be levied and collected a tax on all the taxable property within the City sufficient to pay the interest on the Bonds as it becomes due, and to provide for the payment of the principal of said Bonds and redemption premium, if any, when WPB-FSl~505506vO9\I6787.011300 29 Resolution No. 61-04 due and payable, and the City is, and shall be irrevocably and unconditionally obligated to levy and collect such ad valorem taxes without limitation as to rate or amount on all the taxable property within the City, sufficient in amount to pay all principal of and redemption premium, if any, and interest on said Bonds as the same shall become due and payable. C. CREATION AND ESTABLISHMENT OF A SINKING FUND AND VARIOUS ACCOUNTS AND THE DISPOSITION OF MONEYS. There are hereby created and established the following fund and accounts: THE "SINKING FUND" All of the moneys raised by the City from thc ad valorem taxes on the taxable property within the City for the purpose of paying the principal of and redemption premium, if any, and interest on the Bonds herein authorized shall be deposited by the City in a special fund to be known as the "Sinking Fund" which is hereby created and established. The moneys in said Sinking Fund shall be used solely for the payment of the principal of and redemption premium, if any, and interest on said Bonds as the same become due and payable and the registered owners of said Bonds shall have a first lien on all such moneys in the Sinking Fund until paid and applied in the manner permitted in this Resolution. There are also hereby created and established ~wo (2) separate accounts in the Sinking Fund to be known as the "Interest Account" and the "Principal Account." The moneys at any time on deposit in the Sinking Fund disposed of only in the following manner: WPB-FSI~505506v09\16787.011300 30 Resolution No. 61-04 1. Moneys shall first be used; to the full extent necessary, for deposit into the Interest Account in the Sinking Fund to pay interest becoming due on the Bonds on the next semiannual interest payment date; provided, however, that deposits for interest shall not be required to be made into the Interest Account to the extent that money on deposit therein is sufficient for such purpose. 2. Moneys shall next be used, to the full extent necessary, for deposit into the Principal Account in the Sinking Fund to provide for the required principal amount maturing and becoming due on the next principal payment date; provided, however, that deposits for principal shall not be required to be made into the Principal Account to the extent that money on deposit therein is sufficient for such purpose. 3. The City shall, to the extent of any moneys in any term Bond subaccount within the Principal Account, be mandatorily obligated to use such moneys for the redemption prior to maturity of term Bonds, if any, in such manner and at such times as shall hereafter be determined by subsequent proceedings of the Commission. 4. The Sinking Fund and the accounts therein shall constitute a trust fund of the City. The amounts required to be accounted for in the Sinking Fund and each of the accounts designated herein, may be deposited in a single bank account maintained by the City provided that adequate accounting procedures are maintained to reflect and control the restricted allocations of the amounts on deposit therein for the various purposes of such fund and accounts as herein provided. The designation and establishment of a fund and accounts in and by this Resolution shall not be construed to require the establishment of any completely independent WPB-FSlX505506v09\16787.011300 3 1 Resolution No. 61-04 fund and accounts but rather is intended solely to constitute an allocation of moneys collected by the imposition of ad valorem taxes. 5. Moneys on deposit in the Sinking Fund may be invested in U. S. Obligations or any other Permitted Investments (provided that Permitted Investments other than U. S. Obligations shall be fully collateralized with U.S. Obligations) maturing not later than such date or dates as the City shall determine. 6. All income and eamings received fi.om the investment and reinvestment of moneys on deposit in the Principal Account and Interest Account in the Sinking Fund shall be retained therein and shall be a credit against deposits required by this Resolution. D. DISCHARGE AND SATISFACTION OF BONDS. The covenants, liens and pledges entered into, created or imposed pursuant to this Resolution may be fully discharged and satisfied with respect to the Bonds in any one or more of the following ways: 1. by paying the principal of and interest on Bonds when the same shall become due and payable; or 2. by depositing in the Interest Account and Principal Account, or in such other accounts which are irrevocably pledged to the payment of the Bonds, as the City may hereafter create and establish by resolution, certain moneys, which together with other moneys lawfully available therefor, shall be sufficient at the time of such deposit to pay the Bonds, the interest thereon and the redemption premium, if any, as the same become due on said Bonds on the maturity or earlier redemption date thereof; or WPB-FSl~505506v09\16787.011300 32 Resolution No. 61-04 3. by depositing in the Interest Account and Principal Account or such other accounts which are irrevocably pledged to the payment of the Bonds as the City may hereafter create and establish by resolution, moneys which together with other moneys lawfully available therefor when invested in Defeasance Obligations will provide moneys which shall be sufficient to pay the Bonds, the interest thereon and the redemption premium, if any, as the same shall become due on said Bonds on or prior to the maturity or earlier redemption date thereof. 4. Notwithstanding the foregoing all references to the discharge and satisfaction of Bonds shall include the discharge and satisfaction of any issue of Bonds, any portion of an issue of Bonds, any maturity or maturities of an issue of Bonds, any portion of a maturity of an issue of Bonds or any combination thereof. 5. If any portion of the moneys deposited for the payment of the principal of and redemption premium, if any, and interest on any portion of Bonds is not required for such purpose, the City may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under this Resolution. Upon such payment or deposit in the amount and manner provided in this Section 13.D, the Bonds shall no longer be deemed to be Outstanding for the purposes of the Resolution, and all liability of the City with respect to the Bonds shall cease, terminate and be completely discharged and extinguished, and the Holders thereof shall be entitled for payment solely out of the moneys or securities so deposited. WPB-FSBS05506v09\I6787.011300 33 Resolution No. 61-04 Notwithstanding the foregoing, in the event that the payment or deposit in the amount and manner provided in this Resolution has been made by the Bond Insurer, if any, under the terms of a Bond Insurance Policy, the Bond Insurer shall be subrogated to the rights of the Holders of the Bonds, and the liability of the City, with respect thereto, shall not be discharged or extinguished. Notwithstanding any provisions contained in this Section 13.D to the contrary, the City may, with an opinion of nationally recognized bond counsel, purchase such Bonds that have been deemed discharged and satisfied within the meaning of this Section 13.D and thereby be permitted to use such excess moneys, resulting from such purchase, free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds. SECTION 14. RULE 15c2-12 UNDERTAKING. That in order to assist the initial purchasers of the Bonds with respect to compliance with the Rule, the City undertakes and agrees to provide the information described below to the persons so indicated. The City's Undertaking set forth in this Section 14 shall be for the benefit of the registered owners and beneficial owners (as such term is described below) of the Bonds. A. The City undertakes and agrees to provide to each NRMSIR and to the State of Florida information depository (herein, the "SID") if and when such a SID is created, the City's general purpose financial statements generally consistent with the financial statements presented as an appendix to the official statement relating to the Bonds (herein the "Official Statement"). The information referred to above is herein referred to as the "Annual Information." WPB-FSlX505506v09\16787.011300 34 Resolution No. 61-04 B. The Annual Information described in paragraph A above in audited form (for as long as the City provides such financial information in audited form) is expected to be available on or before March 31 of each year for the Fiscal Year ending on the preceding September 30, commencing March 31, 2005 for the Fiscal Year ending on the preceding September 30, 2004. The Annual Information referred to in paragraph A above in unaudited form (if the audited financial statements are not available or if the City no longer provides such financial information in audited form) will be available on or before March 31 for the Fiscal Year ending on the preceding September 30. The City also agrees to provide the Annual Information to each registered owner and Beneficial Owner of the Bonds who request such information and pays to the City its costs of reproduction and transmission of such Annual Information. The City agrees to provide to each NRMSIR and the SID, if any, timely notice of its failure to provide the Annual Information. Such notice shall also indicate the reason for such failure and when the City reasonably expects such Annual Information will be available. C. The Annual Information referred to in paragraph A above and presented as an appendix to the Official Statement has been prepared in accordance with governmental accounting standards promulgated by the Government Accounting Standards Board, as in effect from time to time, as such principles are modified by generally accepted accounting principles, promulgated by the Financial Accounting Standards Board, as in effect from time to time, and such other State mandated accounting principles as in effect from time to time. D. If, as author/zed by paragraph F below, the City's Undertaking with respect to paragraph C above requires amending, the City undertakes and agrees that the Annual WPB-FSl~505506v09\16787.011300 35 Resolution No. 61-04 Information described in paragraph A above for the Fiscal Year in which the amendment is made will, to the extent possible, present a comparison between the Annual Information prepared on the basis of the new accounting principles and the Annual Information prepared on the basis of the accounting principles described in paragraph C above. The City agrees that such a comparison will, to the extent possible, include a qualitative discussion of the differences in the accounting principles and the impact of the change on the presentation of the Annual Information. E. The City undertakes and agrees to provide, in a timely manner, to each NRMSIR or to the Municipal Securities Rulemaking Board and to the SID, if any, notice of the occurrence of any of the following events with respect to the Bonds, if material: 1. principal and interest payment delinquencies; 2. non-payment related defaults; 3. unscheduled draws on any reserve accotmt reflecting financial difficulties; 4. unscheduled draws on credit enhancements reflecting financial difficulties; 5. substitution of credit or liquidity providers, or their failure to perform; 6. adverse tax opinions or events affecting the tax-exempt status of the Bonds; 7. modifications to rights of Bondholders; WPB-FSDS05506v09\16787.011300 36 Resolution No. 61-04 8. Bond calls (other than scheduled mandatory sinking fund redemptions); 9. defeasance of the Bonds; 10. release, substitution, or sale of property securing repayment of the Bonds; 11. rating changes; and 12. any failure to comply with the provisions of this Section 14, which in all cases, such failure will be deemed material. Notwithstanding the foregoing, notice of the events described in clauses (8) and (9) above need not be given any earlier than the time notice is required to be given to the registered owners of the Bonds. F. Notwithstanding any other provision of this Resolution to the contrary regarding amendments or supplemc~nts, the City undertakes and agrees to amend and/or supplement this Section 14 (including the amendments referred to in paragraph D above) only if: 1. The amendment or supplement is made only in connection with a change in circumstances existing at the time the Bonds were originally issued that arises from (i) a change in law, (ii) SEC pronouncements or interpretations, (iii) a judicial decision affecting the Rule or (iv) a change in the nature of the City's financial condition. WPB-FSlX505506v09\16757.011300 37 Resolution No. 61-04 2. The City's Undertaking, as mended, would have complied with the requirements of the Rule at the time the Bonds were originally issued after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and 3. The amendment or supplement does not materially impair the interests of the registered owners and Beneficial Owners of the Bonds as determined by Bond Counsel or by a majority of the registered owners of the Bonds. In the event of an amendment or supplement under this Section 14, the City shall describe the same in the next report of Annual Information and shall include, as applicable, a narrative explanation of the reason for the amendment or supplement and its impact, if any, on the financial information and operating data being presented in the Annual Information. G. The City's Undertaking as set forth in this Section 14 shall terminate if and when the Bonds are paid or deemed paid within the meaning of this Resolution. H. The City acknowledges that its Undertaking pursuant to the Rule set forth in this Section 14 is intended to be for the benefit of the registered holders and Beneficial Owners of the Bonds and shall be enforceable by such holders and Beneficial Owners; provided that, the holder's and Beneficial Owners' right to enforce the provisions of this Undertaking shall be limited to a right to obtain specific enforcement of the City's obligations hereunder, and any failure by the City to comply with the provisions of this Undertaking shall not be or constitute a covenant or monetary default with respect to the Bonds under this Resolution. For purposes of WPB-FSIX505506v09\I6787.011300 38 Resolution No. 61-04 this Section 14 only, Beneficial Owner shall mean any person which (i) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries) or (ii) is treated as the owner of any Bonds for federal income tax purposes. I. The City reserves the right to satisfy its obligations under this Section 14 through agents; and the City may appoint such agents without the necessity of amending this Resolution. The City may also appoint one or more employees of the City to monitor and be responsible for the City's Undertaking hereunder. SECTION 15. BOOK-ENTRY SYSTEM A. As long as the Bonds are registered under the Book-Entry System, the City and the Registrar, as the case may be, shall comply with the terms of the agreements with the Securities Depository (collectively, the "Book-Entry Agreement"). However, the Book-Entry System through the Securities Depository may be terminated upon the happening of any of the following: 1. The Securities Depository or the City, based upon advice from the Securities Depository, advise the Registrar that the Securities Depository is no longer willing or able to properly discharge its responsibilities under the Book-Entry Agreement and the Registrar and the City are unable to locate a qualified successor clearing agency satisfactory to the Registrar and the City; or WPB-FSIXS05506v09\16787.011300 39 Resolution No. 61-04 2. The City, in accordance with the procedures and requirements of the Securities Depository, elects to terminate the Book-Entry System by notice to the Securities Depository and the Registrar. B. Upon the occurrence of any event described above, (i) the City and the Registrar shall, if necessary, enter into a resolution supplemental to this Resolution to add to the provisions of this Resolution any provisions deemed reasonably necessary or required by the Registrar with respect to Replacement Bonds (including, but not limited to, the provision for the cost and expenses for the printing thereof) and to account for the fact that, thereafter, the Bonds will no longer be registered under the Book-Entry System, and (ii) the Registrar shall notify the Securities Depository of the occurrence of such event and of the availability of definitive or temporary Replacement Bonds to Beneficial Owners requesting the same, in an aggregate Outstanding amount representing the interest of each such Beneficial Owner, making such adjustments and allowances as it may find necessary or appropriate as to accrued interest and previous payments of principal. Definitive Replacement Bonds shall be issued only upon surrender to the Registrar of the Bond of each maturity by the SecUrities Depository, accompanied by registration instructions for the definitive Replacement Bonds for such maturity from the Securities Depository. Neither the City nor the Registrar shall be liable for any delay in delivery of such instructions and conclusively may rely on, and shall be protected in relying on, such instructions. C. Whenever the Bonds are registered under the Book-Entry System and notice or other communication to the Bondholders is required under this Resolution, unless and WPB-FSIX505506v09\16787.011300 40 Resolution No. 61-04 until definitive Replacement Bonds shall have been issued with respect to the Bonds, the City or the Registrar, as the case may be, shall give to the Securities Depository one copy of each such notice and communication specified herein or required by this Resolution to be given to the Beneficial Owners of the Bonds. SECTION 16. MODIFICATION OR AMENDMENT. Except as otherwise provided in the second paragraph hereof, no material modification or amendment of this Resolution, or of any resolution amendatory thereof or supplemental thereto, may be made without the written consent of the Bond Insurer and the consent in writing of the Holders of two- thirds or more in principal amount of the Bonds then Outstanding; provided, however, that no modification or amendment shall permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon, or affecting the unconditional promise of the City to levy, assess and collect an ad valorem tax without limitation as to rate or amount upon all taxable property in the City or to pay the interest of and principal on the Bonds, as the same mature or become due, from said ad valorem tax, or reduce the percentage of Holders of Bonds required above for such modification or amendments, without the consent of the Holders of all the Bonds. This Resolution may be amended, changed, modified and altered without the consent of the Holders of Bonds, but with written notice to the Bond Insurer, (i) to cure any ambiguity, correct or supplement any provision contained herein which may be defective or inconsistent with any other provisions contained herein, (ii) to implement a book-entry system of registration, (iii) to provide other changes which will not adversely affect the interest of such Holders of Bonds, or (iv) to amended the Undertaking pursuant to Section 14 hereof. WPB-FSlXS05506v09\I6787.011300 41 Resolution No. 61-04 Copies of all amendments, modifications or changes to this Resolution shall be provided to Standard & Poor's. For purposes of this Section 16, to the extent the Bonds are insured by a Bond Insurance Policy and such Bonds are then rated in as high a rating category in which such Bonds were rated at the time of initial issuance and delivery thereof, by both Standard & Poor's and Moody's Investors Service, Inc., then the consent of the Bond Insurer may constitute the consent of the Holders of the Bonds, provided such Bond Insurer agrees to give consent under such circumstances and is not in default under the Bond Insurance Policy. SECTION 17. SEVERABILITY OF INVALID PROVISIONS. If any one or more of the covenants, agreements or provisions of this Resolution should be held contrary to any express provision of law or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions, and shall in no way affect the validity of any of the other provisions of the Resolution or of the Bonds or coupons issued hereunder. SECTION 18. SALE OF BONDS. The Bonds shall be issued and sold at one time or fi.om time to time, in such manner and at such price or prices consistent with the provisions of the Act and the requirements of the Commission as shall hereafter be determined by subsequent proceedings. SECTION 19. BOND ANTICIPATION NOTES. The City may, if it determines it to be in its best financial interest, issue its bond anticipation notes in order to temporarily finance WPB-FS DS05506v09\16787.011300 42 Resolution No. 6 1-04 the cost of the Projects. The City shall by proper proceedings authorize the issuance and establish the details of such bond anticipation notes pursuant to the provisions of Section 215.431, Florida Statutes, as amended. In connection with such bond anticipation notes, the City is hereby authorized to enter into line of credit agreements, loan agreements or similar arrangements (collectively referred to as "Financing Agreement") with banks or similar financial institutions for the purpose of financing the costs of the Projects. The City is authorized to issue one or more bond anticipation notes to such banks or financial institutions to evidence its obligation to repay loans made under such Financing Agreements. SECTION 20. PRELIMINARY OFFICIAL STATEMENT AND NOTICE OF SALE. The City is hereby authorized to distribute (both in paper form or electronically) a preliminary official statement relating to marketing of the Bonds and publish a notice of sale as required under applicable law. Such distribution and publication may be accomplished using the world-wide web. The Mayor, the Vice Mayor, the City Manager, the Finance Director or the Treasurer are each authorized to deem the preliminary official statement relating to the Bonds "final" within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934. SECTION 21. REMEDIES. Any Bondholder, to the full extent permitted by the laws of the State of Florida or the United States of America, may sue to protect and enforce any and all legal rights; to seek the appoinmaent of a receiver, and to enforce and compel the performance of all duties required by this Resolution. SECTION 22. EFFECTIVE DATE. This Resolution shall take effect upon the passage in the manner provided by law. WPB-FS1LS05506v09\I6787.011300 43 Resolution No. 61-04 Passed and adopted in regular session this 7th day of September, 2004. CITY OF DELRAY BEACH, FLORIDA (SEAL) By: ~ ATTEST: Acting City Clerk The foregoing Resolution and bond form is h~reby approved by me as to form, language and execution, this 7th day of September, 2004. 'xVPB-FSl~505506v09\16787.011300 44. Resolution No. 61-04 MEMORANDUM To: City Commission From: David T. Harden, City Manager~(-~. Subject: Proposed $14,000,000 General Obligation Bonds Date: September 1,2004 We have attached for Commission approval Resolution# 61-04 and 62-04 relative to the issuance of proposed General Obligation Bonds. A brief description of each resolution is as follows: Resolution# 61-04 authorizes the issuance of General Obligation Bonds not to exceed $14,000,000; providing for the allocation of proceeds consistent with Resolution #72-03 (authorizing certain projects and calling for a referendum), and providing for other matters deemed necessary and proper in connection with the issuance of the bonds. Resolution #62-04 authorizes the competitive sale of General Obligation Bonds not to exceed $24,000,000; establishes the maturity schedule, authorizes the Finance Director to publish a summary notice of sale and to receive bids pursuant to the responsive bidder offering the lowest true interest cost which shall not exceed 6%, appointing a paying agent and bond registrar, approving the form of a summary notice of sale, an official notice of bond sale and bid form, providing for a bond insurance policy, and authorizing the proper officers to do all other things necessary to effectuate the sale. The Finance Department recommends approval of this resolution. I concur with their recommendation. c: R.S. O'Connor, Treasurer File: commiss04res.doc RESOLUTION NO. 61-04 CITY OF DELRAY BEACH, FLORIDA General Obligation Bonds, Series 2004 (Recreational and Cultural Projects) General Obligation Bond Resolution Adopted September 7, 2004 WPB-FSI~505506v09\16787.011300 Resolution No. 61-04 TABLE OF CONTENTS SECTION 1. DEFINITIONS ................................................................................................... 3 SECTION 2. FINDINGS ......................................................................................................... 8 SECTION 3. AUTHORITY OF THIS RESOLUTION .......................................................... 8 SECTION 4. RESOLUTION CONSTITUTES CONTRACT ................................................ 8 SECTION 5. AUTHORIZATION AND DESCRIPTION OF BONDS ................................. 9 SECTION 6. REDEMPTION PROVISIONS ....................................................................... 11 SECTION 7. EXECUTION OF BONDS .............................................................................. 11 SECTION 8. NEGOTIABILITY, REGISTRATION AND CANCELLATION .................. 12 SECTION 9. BONDS MUTILATED, DESTROYED, STOLEN OR LOST ....................... 14 SECTION 10. FORM OF BONDS .......................................................................................... 14 SECTION 11. APPLICATION OF BOND PROCEEDS ................................................. ......24 SECTION 12. SECURITY FOR THE BONDS ...................................................................... 26 SECTION 13. COVENANTS OF THE CITY ........................................................................ 26 SECTION 14. RULE 15c2-12 UNDERTAKING ................................................................... 31 SECTION 15. BOOK-ENTRY SYSTEM ............................................................................... 36 SECTION 16. MODIFICATION OR AMENDMENT ........................................................... 37 SECTION 17. SEVERABILITY OF INVALID PROVISIONS ............................................. 38 SECTION 18. SALE OF BONDS ........................................................................................... 39 SECTION 19. BOND ANTICIPATION NOTES ................................................................... 39 SECTION 20. PRELIMINARY OFFICIAL STATEMENT AND NOTICE OF SALE ........ 39 SECTION 21. REMEDIES ...................................................................................................... 40 SECTION 22. EFFECTIVE DATE ......................................................................................... 40 WPB-FSI\505506v09\16787.011300 i Resolution No. 61-04 Resolution No. 61-04 A RESOLUTION OF THE CITY COMMISSION OF DELRAY BEACH, FLORIDA, AUTHORIZING THE ISSUANCE OF NOT EXCEEDING $24,000,000 IN THE INITIAL AGGREGATE PRINCIPAL AMOUNT OF CITY OF DELRAY BEACH, FLORIDA GENERAL OBLIGATION BONDS, SERIES 2004 (RECREATIONAL AND CULTURAL PROJECTS); PROVIDING FOR ALLOCATION OF THE PROCEEDS OF SUCH BONDS CONSISTENT WITH RESOLUTION NO. 72-03; PROVIDING THE FORM AND TERMS OF THE BONDS; PROVIDING FOR THE PAYMENT OF THE BONDS FROM A TAX ON ALL TAXABLE PROPERTY ]iN THE CITY OF DELRAY BEACH; PROVIDING FOR THE UNDERTAKING BY THE CITY REGARDING SECONDARY MARKET DISCLOSURE AS REQUIRED BY RULE 15c2-12 OF THE SECURITIES AND EXCHANGE COMMISSION; PROVIDING FOR THE RIGHTS, REMEDIES AND SECURITY OF THE HOLDERS OF THE BONDS; PROVIDING FOR CERTAIN OTHER MATTERS DEEMED NECESSARY AND PROPER IN CONNECTION WITH THE ISSUANCE OF THE BONDS; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Commission of Delray Beach, Florida (the "Commission"), did, on October 21, 2003, adopt Resolution No. 72-03 entitled "A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, PROVIDING FOR THE ISSUANCE OF GENERAL OBLIGATION BONDS FOR THE PURPOSE OF FINANCING THE (A) ACQUISITION OF LAND, THE CONSTRUCTION AND EQUIPPING OF UP TO THREE NEW NEIGHBORHOOD PARKS, THE CONSTRUCTION AND EQUIPPING OF A SOCCER COMPLEX; THE CONSTRUCTION, RECONSTRUCTION AND EQUIPPING OF CERTAIN EXISTING PARKS THROUGHOUT THE CITY IN THE PRINCIPAL AMOUNT NOT EXCEEDING $9,000,000; (B) ACQUISITION OF LAND, THE CONSTRUCTION AND EQUIPPING OF A NEW RECREATION CENTER IN THE WESTERN AREA OF THE CITY, AND THE CONSTRUCTION AND/OR RECONSTRUCTION OF IMPROVEMENTS TO AND EQUIPPING OF CERTAIN EXISTING RECREATION CENTERS IN THE PRINCIPAL AMOUNT NOT EXCEEDING $7,000,000; (C) ACQUISITION OF LAND, CONSTRUCTION OF A PARKING GARAGE AND OTHER CAPITAL IMPROVEMENTS WVB-FS~0550~v09X~6787.0~ ~300 Resolution No. 61-04 AS PART OF THE EXPANSION OF OLD SCHOOL SQUARE 1N THE PRINCIPAL AMOUNT NOT EXCEEDING $7,000,000; AND (D) ACQUISITION OF FURNISHINGS AND FIXTURES FOR THE NEW LIBRARY IN THE PRINCIPAL AMOUNT NOT TO EXCEED $1,000,000; CALLING FOR A BOND REFERENDUM OF THE QUALIFIED VOTERS IN THE CITY OF DELRAY BEACH TO BE HELD JANUARY 20, 2004, AS TO WHETHER GENERAL OBLIGATION BONDS FOR SUCH PROJECTS SHOULD BE ISSUED; AND PROVIDING AN EFFECTIVE DATE" (the "Referendum Resolution"), and the qualified electors of the City of Delray Beach, Florida (the "City"), did, at an election held on January 20, 2004 (the "Referendum"), authorize by majority vote the issuance of $24,000,000 general obligation bonds to finance the cost of the acquisition and construction of the projects described above in the respective principal amounts set forth in the Referendum Resolution and as described below (the "Projects"). WHEREAS, the Commission hereby determines it to be in the best financial and economic interest of the City to issue its City of Delray Beach, Florida, General Obligation Bonds, Series 2004 (Recreational and Cultural Projects) (the "Bonds"), in the initial aggregate principal amount of not exceeding $24,000,000 to finance the acquisition and construction of the Projects in the manner provided herein; and WHEREAS, effective July 3, 1995, Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission ("SEC"), provides that it is unlawful for a broker dealer or municipal securities dealer to purchase or sell municipal securities, which includes the Bonds, unless the issuer, which includes the City, has undertaken in a written agreement (herein, the "Undertaking") to provide to specified information repositories annual financial information and WPB-FSIXS05506v09\16787.011300 2 Resolution No. 61-04 operating data relevant to the municipal securities and notice of certain specified material events; and WHEREAS, the Commission hereby determines to provide its Undertaking with respect to the Bonds in this Resolution; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF DELRAY BEACH, FLORIDA: SECTION 1. DEFINITIONS. That, in addition to the terms defined above, as used in this Resolution, the following terms shall have the following meanings unless the text otherwise expressly requires: "Act" shall mean the Florida Constitution, Chapter 166, Florida Statutes, as amended and supplemented, the City Charter of Delray Beach, as amended and supplemented, and other applicable provisions of law. "Beneficial Owner" shall mean, except with respect to any secondary market disclosure requirements relating to the Bonds as described in Section 14 herein, during any period the Bonds are registered under the Book-Entry System, any purchaser of a Bond and others who acquire a beneficial ownership interest in a Bond held by the Securities Depository. In determining the Beneficial Owner of any Bond, the City, the Paying Agent and the Registrar may rely exclusively upon written representations made, and information given to the City, the Paying Agent or the Registrar by the Securities Depository or its Participants with respect to any Bond held by the Securities Depository in which a beneficial ownership interest is claimed. With respect to Replacement Bonds, the City, the Paying Agent and the Registrar shall consider the owner of any such Replacement Bond as registered on the registration books of the City maintained by the Registrar to bc the Beneficial Owner thereof. WPB-FSBS05506v09\I6787.011300 3 Resolution No. 61-04 "Bond Insurance Policy" shall mean an insurance policy issued for the benefit of the Holders of any Bonds, pursuant to which the Bond Insurer shall be obligated to pay when due the principal of and interest on such Bonds to the extent of any deficiency in the amounts in the funds and accounts held under this Resolution, in the manner and in accordance with the terms provided in such Bond Insurance Policy. "Bond Insurer" shall mean the issuer of a Bond Insurance Policy and its successors. "Bondholder" or "Holder of Bonds" or "Owner" or any similar term, shall mean any person who shall be the registered owner of any Bond or Bonds Outstanding under the terms of this Resolution. "Bonds" shall mean the not exceeding in initial aggregate principal amount $24,000,000 General Obligation Bonds, Series 2004 (Recreational and Cultural Projects), authorized to be issued pursuant to this Resolution. "Book-Entry System" shall mean the system under which the City may issue the Bonds and maintain the registration for such Bonds in book-entry form only. "Code" shall mean the Internal Revenue Code of 1986, as amended, and all subsequent tax legislation duly enacted by the Congress of the United States. Each reference to a section of the Code herein shall be deemed to include, if applicable, final, temporary or proposed regulations, revenue rulings and proclamations issued or amended with respect thereto, and any final, temporary or proposed regulations and revenue rulings and procedures promulgated under the Internal Revenue Code of 1954, as amended, by the Treasury Department or Internal Revenue Service of the United States. WPB-FSBS05506v09\16787.011300 4 Resolution No. 61-04 "Defeasance Obligations" shall mean to the extent permitted by law and the Bond Insurer: (a) U.S. Obligations; (b) Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state (i) which are not callable prior to maturity or as to which irrevocable instructions have been given to the h'ustee of such bonds or other obligations by the obligor to give due notice of redemption and to call such bonds for redemption on the date or dates specified in such instructions, (ii) which are secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described in clause (a) hereof which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the redemption date or dates specified in the irrevocable instructions referred to in subclause (i) of this clause (b), as appropriate, and (iii) as to which the principal of and interest on the bonds and obligations of the character described in clause (a) hereof which have been deposited in such fund along with any cash on deposit in such fund are sufficient to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this clause (b) on the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subclause (i) of this clause (b), as appropriate; (c) Evidences of indebtedness issued by the Federal Home Loan Banks, Federal Home Loan Mortgage Corporation (including participation certificates), Federal Financing Banks, or any other agency or instrumentality of the United States of America created WPB-FSI~505506v09\I6787.011300 5 Resolution No. 61-04 by an act of Congress provided that the obligations of such agency or instrumentality are unconditionally guaranteed by the United States of America or any other agency or instrumentality of the United States of America or of any corporation wholly-owned by the United States of America; and (d) Evidences of ownership of proportionate interests in future interest and principal payments on obligations described in (a) held by a bank or trust company as custodian. "NRMSIR" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. A list of the names and addresses of each of the current NRMSIR may be obtained by calling the United States Securities and Exchange Commission's Fax on Demand Service from a fax machine phone line at (202) 942-8088 and requesting document numbers 0206 and 0207, respectively, or by visiting its website at http://www.sec.gov/info/municipal/nrmsir.htm. "Outstanding" shall mean, when used with reference to the Bonds, as of any particular date, all Bonds theretofore, or thereupon being, authenticated and delivered by the Registrar under this Resolution, except (i) Bonds theretofore or thereupon cancelled by the Registrar or surrendered to the Registrar for cancellation; (ii) Bonds with respect to which all liability of the City shall have been discharged in accordance with Section 13.D of this Resolution; (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authenticated and delivered by the Registrar pursuant to any provision of this Resolution; (iv) Bonds cancelled after purchase in the open market or because of payment at, or redemption prior to maturity; and (v) Bonds held by the City. WPB-FS1LS05506v09\I6787.011300 6 Resolution No. 61-04 "Participants" shall mean brokers, dealers, banks and other financial institutions and other persons for whom, from time to time, the Securities Depository effects book-entry transfers and pledges of securities deposited with the Securities Depository. "Paying Agent" shall mean the Finance Director of the City or his designee or such bank or trust company and any successor bank or trust company appointed by the City to act as Paying Agent hereunder. "Permitted Investments" shall mean (i) U. S. Obligations, and (ii) all other investments permitted under the laws of Florida and acceptable to the Bond Insurer, if any. "Registrar" shall mean the Finance Director of the City or his designee or such bank or trust company and any successor bank or trust company appointed by the City to act as Registrar hereunder. "Replacement Bonds" shall mean certificated Bonds authenticated and delivered pursuant to Section 15 of this Resolution, when the City discontinues the Book-Entry System. "Securities Depository" shall mean, with respect to the Bonds to be issued in book entry form, The Depository Trust Company and its successors and assigns, or a successor clearing agency designated pursuant to Section 15 hereof and its successors and assigns. "Tax Certificate" shall mean the Arbitrage Certificate executed by the City on the date of initial issuance and delivery of the Bonds, as such Tax Certificate may be amended from time to time, a source of guidance for achieving compliance with the Code. "U. S. Obligations" shall mean the direct obligations of, or obligations the timely payment of principal of and interest on which are unconditionally guaranteed by, the United States of America, and, if determined by subsequent proceedings of the Commission, certificates WPB-FSI~505S06v09\I6787.011300 7 Resolution No. 61-04 which evidence ownership of the fight to the payment of the principal of, or interest on, such obligations. Words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Words importing the singular number shall include the plural number and vice versa unless the context shall otherwise indicate. The word "person" shall include corporations; associations, natural persons and public bodies unless the context shall otherwise indicate. Reference to a person other than a natural person shall include its Successors. SECTION 2. FINDINGS. A. That it is necessary, advantageous, desirable and in the best interests of the City and its residents that the Bonds he issued to finance the acquisition and construction of the Projects in the respective principal amounts authorized under the Referendum Resolution. B. That the Bonds may be issued either all at one time or in part from time to time as the Commission may in its discretion hereafter determine by subsequent resolution. SECTION 3. AUTHORITY OF THIS RESOLUTION. This Resolution is adopted pursuant to the Act. SECTION 4. RESOLUTION CONSTITUTES CONTRACT. In consideration of the acceptance of the Bonds, authorized to be issued hereunder by those who shall hold the same from time to time, the Resolution shall be deemed to be and shall constitute a contract between the City and such Bondholders, and the covenants and agreements herein set forth to be performed by the City shall be for the equal benefit, protection and security of the Holders of any and all of such Bonds, all of which shall be of equal rank and without preference, priority, or WPB-FSI~505506v09\16787.011300 8 Resolution No. 61-04 distinction of any of the Bonds over any other thereof except as expressly provided therein and herein. SECTION 5. AUTItORIZATION AND DESCRIPTION OF BONDS. Subject and pursuant to the provisions of this Resolution, Bonds of the City to be known as "General Obligation Bonds, Series 2004 (Recreational and Cultural Projects)," are hereby authorized to be issued in the initial aggregate principal amount of not exceeding Twenty Four Million Dollars ($24,000,000) for the purpose of financing all or a portion of the costs of acquisition and construction and equipping of the Projects pursuant to the provisions of this Resolution in the principal amounts allocated pursuant to the terms and provisions of the Referendum Resolution and to pay the cost of issuance of the Bonds. The Bonds shall be issued in registered form, shall be in the denomination of $5,000 each, or any integral multiple thereof, and shall be numbered separately and consecutively upward. The Bonds shall be designated "General Obligation Bonds, Series 2004 (Recreational and Cultural Projects)," with such other designation deemed appropriate and determined by subsequent proceeding of the Commission, shall bear interest at not exceeding the maximum rate or rates permitted by law, payable by check or draft made payable to the Holder of Bonds and mailed to the address of such Holder of Bonds as such name and address shall appear on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day of the calendar month preceding each interest payment date (which unless determined otherwise by subsequent proceedings of the Commission, shall be the first day of February and August) or on the date the principal sum of any Bond is paid (herein, the "Record Date"); provided, however, that payment of interest on the Bonds may, at the option of any Holder of Bonds in an aggregate principal amount of at least $1,000,000, be transmitted by wire transfer to the designated account number of such Holder of any Bonds within the WPB-FSlk505506v09\16787.011300 9 Resolution No. 61-04 continental United States on file with the Paying Agent as of the Record Date. The Bonds may be issued as either serial Bonds or term Bonds or any combination thereof. The Bonds authenticated prior to the first interest payment date shall be dated and bear interest from the date determined by subsequent proceedings of the Commission. Bonds authenticated on or subsequent to the first interest payment date shall be dated as of the date of their registration and shall bear interest as of the interest payment date immediately preceding the date of registration, unless such date of registration shall be an interest payment date, in which case, such Bonds shall bear interest from such date of registration, or if registered during the period from a Record Date preceding an interest payment date to such interest payment date, then from such interest payment date if interest is then paid, as the case may be; provided, however, that if and to the extent there is a default in the payment of the interest due on such interest payment date, such defaulted interest shall be paid to the persons in whose name Bonds are registered on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day prior to a subsequent interest payment date established by notice mailed by the Registrar to the registered owner not less than the tenth day preceding such subsequent interest payment date, such interest shall be payable semiannually of each year, and shall mature in such years and amounts, all as shall be determined by subsequent proceedings of the Commission. In the event any payment of interest or of interest and principal on the Bonds shall not be paid when due, the amount so in default shall continue to bear interest to the extent permitted by law from the date such payment became due until payment thereof at the rate set forth on the face of each Bond. Such Bonds shall mature in such amounts and at such times not exceeding twenty (20) years from the date of issuance of the Bonds, and shall be payable and registrable at such place or WPB-FSILS05506v09\16787.011300 10 Resolution No. 61-04 places within or out of the State of Florida as shall hereafter be determined by subsequent proceedings of the Commission. SECTION 6. REDEMPTION PROVISIONS. The Bonds may be subject to redemption prior to maturity at such times, at such redemption prices and upon such terms as shall be determined by subsequent proceedings of the Commission. SECTION 7. EXECUTION OF BONDS. That the Bonds shall be executed in the name of the City by the Mayor, and the official seal of the City shall be affixed thereto or lithographed, impressed, imprinted or otherwise reproduced thereon and attested by the City Clerk, or in such manner as may be permitted by law. The signatures of the Mayor or the City Clerk on the Bonds may be manual or facsimile signature. In case any one or more of the officers who shall have signed or sealed any of the Bonds shall cease to be such officer before the Bonds so signed and sealed have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. Any of the Bonds may be signed and sealed on behalf of the City by such person as at the actual time of execution of such Bonds shall hold the proper office, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The Bonds shall bear thereon a certificate of registration and authentication, in the form set forth in Section 10 hereof, executed manually by the Registrar. Only such Bonds as shall bear thereon such certificate of registration and authentication shall be entitled to any right or benefit under this Resolution and no Bond shall be valid or obligatory for any purpose until such certificate of registration and authentication shall have been duly executed by the Registrar. Such certificate of the Registrar upon any Bond executed on behalf of the City shall be conclusive WPB-FSIXS05506v09\16787.011300 11 Resolution No. 61-04 evidence that the Bond so authenticated has been duly registered and authenticated and delivered under this Resolution and that the holder thereof is entitled to the benefits of this Resolution. SECTION 8. NEGOTIABILITY, REGISTRATION AND CANCELLATION. Subject to the provisions of Section 15 hereof, at the option of the registered holder of any Bond and upon surrender thereof at the designated corporate trust office of the Regislxar, with a written instrument of transfer satisfactory to the Registrar duly executed by the registered holder of a Bond or his duly authorized attorney and upon payment by such holder of any charges which the Registrar or the City may make as provided in this Section, the Bonds may be exchanged for Bonds of the same series and maturity of any other authorized denominations. The Registrar shall keep books for the registration of Bonds and for the registration of transfers of Bonds. The Bonds shall be transferable by the registered holder thereof in person or by his attorney duly authorized in writing only upon the books of the City kept by the Registrar and only upon surrender thereof together with a written instrument of transfer satisfactory to the Registrar duly executed by the registered holder or his duly authorized attorney. Upon the transfer of any such Bond, the City shall issue in the name of the transferee a new Bond or Bonds. The City, the Registrar and the Paying Agent shall deem and treat the person in whose name any Bond shall be registered upon the books kept by the Registrar as the absolute holder of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, premium, if any, and interest on such Bond as the same become due and for all other purposes. All such payments so made to any such holder or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the WPB-FSBS05506v09\I6787.011300 12 Resolution No. 61-04 extent of the sum or sums so paid, and neither the City, the Registrar nor the Paying Agent shall be affected by any notice to the contrary. Subject to the provisions of Section 15 hereof, in all cases in which the privilege of exchanging Bonds or transferring Bonds is exercised, the City shall execute and the Registrar shall authenticate and deliver Bonds in accordance with the provisions of this Resolution. All Bonds surrendered in any such exchanges or transfers shall forthwith be delivered to the Registrar and cancelled by the Registrar in the manner provided in this Section. There shall be no charge for any such exchange or transfer of Bonds, but the City or the Registrar may require the payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Neither the City nor the Registrar shall be required (a) to transfer or exchange Bonds for a period commencing on the Record Date and ending on the next ensuing interest payment date for such Bonds or 15 days next preceding any selection of Bonds to be redeemed or thereafter until after the mailing of any notice of redemption; or (b) to transfer or exchange any Bonds called for redemption. However, if less than all of a Bond is redeemed or defeased, the City shall execute and the Registrar shall authenticate and deliver, upon the surrender of such Bond, without charge to the Bondholder, for the unpaid balance of the principal amount of such Bond so surrendered, a registered Bond in the appropriate denomination. All Bonds paid or redeemed, either at or before maturity shall be delivered to the Registrar when such payment or redemption is made, and such Bonds, together with all Bonds that may be purchased by the City, shall thereupon be promptly cancelled. Bonds so cancelled may at any time be destroyed by the Registrar, who shall execute a certificate of destruction in duplicate by the signature of one of its authorized officers describing the Bonds so destroyed, WPB-FSBS05506v09\16787.011300 13 Resolution No. 61-04 and one executed certificate shall be filed with the City and the other executed certificate shall be retained by the Registrar. SECTION 9. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated, destroyed, stolen or lost, the City may execute and the Registrar shall authenticate and deliver a new Bond of like date, maturity, denomination and interest rate as the Bond so mutilated, destroyed, stolen or lost; provided that, in the case of any mutilated Bond, such mutilated Bond shall first be surrendered to the City and, in the case of any lost, stolen or destroyed Bond, there shall first be furnished to the City and the Registrar evidence of such loss, theft, or destruction satisfactory to the City and the Registrar, together with indemnity satisfactory to them. In the event any such Bond shall be about to mature or have matured or have been called for redemption, instead of issuing a duplicate Bond, the City may pay the same without surrender thereof. The City and the Registrar may charge the holder of such Bond their reasonable fees and expenses in connection with this transaction. Any Bond surrendered for replacement shall be cancelled in the same manner as provided in Section 8 of this Resolution. Any such duplicate Bonds issued pursuant to this Section shall constitute additional contractual obligations on the part of the City, 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 with all other Bonds issued hereunder. SECTION 10. FORM OF BONDS. The text of the Bonds shall be of substantially the following tenor, with such omissions, insertions and variations as may be necessary and desirable: WPB-FSI~505506v09~I6787.011300 14 Resolution No. 61-04 WPB-FSIXS05506v09\16787.011300 15 Resolution No. 61-04 (Face of Bond) No. $ ,000 UNITED STATES OF AMERICA STATE OF FLORIDA PALM BEACH COUNTY CITY OF DELRAY BEACH GENERAL OBLIGATION BOND SERIES 2004 (Recreational and Cultural Projects) Interest Rate Maturity Date Dated Date CUSIP Registered Owner: Principal Amount: KNOW ALL MEN BY THESE PRESENTS, that City of Delray Beach, Florida, a municipal corporation created and existing under and by virtue of the laws of the State of Florida (the "City"), hereby acknowledges itself to be indebted, and for value received, hereby promises to pay the Registered Owner or registered assigns on the Maturity Date specified above, from the sources hereinafter mentioned, upon the presentation and surrender hereof at the designated corporate trust office of as paying agent (said and any other bank or trust company becoming successor paying agent being herein called the "Paying Agent"), the Principal Amount stated above together with interest thereon at the Interest Rate payable on the first day of and of each year commencing Interest on this Bond (except for Holders of at least $1,000,000 in aggregate principal amount of bonds, who may receive payment of interest by WPB-FSIX305506v09\I6787.011300 16 Resolution No. 61-04 wire transfer in the manner provided in the herein referred to Resolution) is payable by check or draft of the Paying Agent made payable to the Registered Owner and mailed to the address of the Registered Owner as such name and address shall appear on the registration books of the City initially maintained by , as registrar (said and any other bank or trust company becoming successor registrar being herein called the "Registrar") at the close of business on the fifteenth day of the calendar month preceding each interest payment date or the date on which the principal of a Bond is to paid (the "Record Date"); provided, however, that if and to the extent there is a default in the payment of the interest due on such interest payment date, such defaulted interest shall be paid to the persons in whose name Bonds are registered on the registration books of the City maintained by the Registrar at the close of business on the fifteenth day prior to a subsequent interest payment date established by notice mailed by the Registrar to the registered owner not less than the tenth day preceding such subsequent interest payment date. Such, interest shall be payable from the most recent interest payment date next preceding the date of registration to which interest has been paid, unless the date of registration is an 1 or 1 to which interest has been paid, in which case from the date of registration, or unless the date of registration is prior to ,200_, in which case from ,200_, or unless the date of registration is between a Record Date and the next succeeding interest payment date, in which case from such interest payment date. The Principal Amount and accrued interest thereon is payable in any coin or currency of the United States of America, which, on the date of payment thereof, shall be legal tender for the payment of public and private debts. This bond is one of an issue of bonds in the aggregate principal amount of not exceeding $ ~ of like date, tenor and amount, except as to the number, date of maturity and wvn-vs~o55o6vo9u6787.m t3oo 17 Resolution No. 61-04 interest rate, issued by the City, for the purpose of financing the costs of all or a portion of certain recreational and cultural projects within the City under the authority of and in full compliance with the Constitution and statutes of the State of Florida, including Chapter 166, Florida Statutes, as amended and supplemented, the City Charter of Delray Beach, as amended and supplemented, and other applicable provisions of law and pursuant to a resolution (the "Resolution") duly adopted by the City Commission of Delray Beach, Florida, authorizing the issuance of the bonds. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of this bond, exist, have happened and have been performed in regular and due form and time as required by the laws and Constitution of the State of Florida applicable thereto, and that the issuance of this bond and of the bonds of the issue of which this bond is one does not violate any constitutional or statutory debt limitation or provision; that due provision has been made for the levy and collection of a direct annual tax in addition to all other taxes, upon all the taxable property within the City sufficient to pay the principal of and interest on said bonds as the same shall mature and become due, and that the full faith and credit of Delray Beach, Florida, are hereby irrevocably pledged for the punctual payment of the principal of and interest on this bond, as the same shall become due and payable. WPB-FS 1~505506v09\16787.011300 1 8 Resolution No. 61-04 IN WITNESS WHEREOF, Delray Beach, a municipal corporation of the State of Florida, has caused this bond to be signed by its Mayor either manually or with his facsimile signature, and the seal of said City or a facsimile thereof, to be affixed hereto, or lithographed, impressed, imprinted or otherwise reproduced hereon, attested by the City Clerk of said City~ either manually or with her facsimile signature, all as of the Dated Date. (SEAL) CITY OF DELRAY BEACH, FLORIDA Mayor ATTEST: City Clerk WPB-FSl~505506v09\I6787.011300 19 Resolution No. 61-04 (FORM OF CERTIFICATE OF REGISTRATION AND AUTHENTICATION) This bond is one of the bonds delivered pursuant to the within mentioned Resolution of the City Commission of Delray Beach, Florida. Date of Authentication: as Registrar By: Authorized Officer WPB-FSDS05506v09\16787.011300 20 Resolution No. 61-04 (Back of Bond) (Insert Applicable Redemption Provisions) The original registered owner, and each successive registered owner of this bond shall be conclusively deemed to have agreed and consented to the following terms and conditions: (1) The Registrar shall keep books for the registration of bonds and for the registration of transfers of bonds as provided in the Resolution. The bonds shall be transferable by the registered owner thereof in person or by his attorney duly authorized in writing only upon the books of the City kept by the Registrar and only upon surrender hereof together with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney. Upon the transfer of any such bond, the City shall issue in the name of the transferee a new bond or bonds. (2) The City, the Paying Agent and the Registrar shall deem and treat the person in whose name any bond shall be registered upon the books kept by the Registrar as the absolute owner of such bond, whether such bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such bond as the same becomes due, and for all other purposes. All such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such bond to the extent of the sum or sums so paid, and neither the City, the Paying Agent, nor the Registrar shall be affected by any notice to the contrary. (3) At the option of the registered owner thereof and upon surrender hereof at the designated corporate trust office of the Registrar with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney and upon payment by such registered owner of any charges which the Registrar or the City may make as WPB-FSBS05506v09~I6787.011300 21 Resolution No. 61-04 provided in the Resolution, the bonds may be exchanged for bonds of the same series and maturity of any other authorized denominations. (4) In all cases in which the privilege of exchanging bonds or transferring bonds is exercised, the City shall execute and the Registrar shall authenticate and deliver bonds in accordance with the provisions of the Resolution. There shall be no charge for any such exchange or transfer of bonds, but the City or the Registrar may require payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Neither the City nor the Registrar shall be required (a) to transfer or exchange bonds for a period commencing on a Record Date and ending on the next ensuing interest payment date for such bonds or 15 days next preceding any selection of bonds to be redeemed or thereafter until after the mailing of any notice of redemption; or (b) to transfer or exchange any bonds called for redemption. However, if less than all of a Bond is redeemed or defeased, the City shall execute and the Registrar shall authenticate and deliver, upon the surrender of such Bond, without charge to the Bondholder, for the unpaid balance of the principal amount of such Bond so surrendered, a registered Bond in the appropriate denomination. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Resolution until the certificate of registration and authentication hereon shall have been signed by an authorized officer of the Registrar. WPB-FSB505506v09\I6787.011300 22 Resolution No. 61-04 ASSIGNMENT AND TRANSFER FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto (please print or typewrite name and address of transferee) the within bond and all rights thereunder, and hereby irrevocably constitutes and appoints Attorney to transfer the within' bond on the books kept for registration thereof, with full power of substitution in the premises. Dated: In the presence of: [STATEMENT OF INSURANCE, IF ANY] WPB-rsBS05506v09\16787.011300 23 Resolution No. 61-04 SECTION 11. APPLICATION OF BOND PROCEEDS. The accrued interest derived from the sale of the Bonds, if any, shall be deposited in the Interest Account, hereinafter created and established and used for the purpose of paying the interest on the Bonds as the same becomes due and payable. The remaining proceeds of such sale shall be deposited in the Capital Projects Fund hereby created and established and used for the purpose of financing all or a portion of the costs of the Projects including all costs and expenses relating and incidental thereto and all costs and expenses as may be necessary or incidental and incurred by the City in connection with the issuance of the Bonds. There is also hereby created and established a Costs of Issuance Account within the Capital Projects Fund which will be held by the City and funded with a portion of the moneys on deposit in the Capital Projects Fund in the amount determined by the City's Finance Director. Moneys on deposit in the Cost of Issuance Account shall be used to pay any legal expenses, expenses for fiscal agents or financial services, and such other expenses as may be necessary or incidental and incurred by the City in connection with the issuance of the Bonds. During the period the moneys on deposit in the Capital Projects Fund have not been applied as contemplated above, any earnings from moneys held in the Capital Projects Fund invested pursuant to the requirements of this Resolution shall be retained in the Capital Projects Fund. Amounts on deposit in the Capital Projects Fund shall be invested by the City in Permitted Investments maturing not later than the dates such moneys will be needed for its intended purpose. Each of the Projects shall consist of various components (herein referred to as a "Component" or "Components'). The Components comprising each of the Projects, with the WPB-FS 1~505506v09\16787.011300 24 Resolution No. 6 1-04 estimated costs for each are more fully described in an exhibit attached to the Referendum Resolution and by this reference incorporated herein. Notwithstanding the principal amounts assigned to each Component, the actual cost of a particular Component may be greater or less than the estimated cost allocated to such Component. If the actual cost of a Component is greater than the amount allocated to the Referendum Resolution, the City may provide for such deficiency from other available funds or from surplus funds that had been allocated to another Component of the same Project. If the actual Cost of a Component is less than that allocated in the Referendum Resolution, the City may use such surplus for other Components of the same Project If, after application of the foregoing, there remain insufficient funds to complete a Component due to unforeseen cost escalations or failure to receive anticipated governmental grants or private contributions, or other unexpected circumstances, the City may delete a part of such Component or modify such Component so that such Component may be completed. The City will not delete any Component to generate surplus moneys for other Components, nor will it expend Bond proceeds in excess of the amounts allocated to each of the Projects set forth in the exhibit attached to the Referendum Resolution. Upon certification in writing by the City Manager that the Projects have been completed, any money remaining in the Capital Projects Fund, in the discretion of the City, may be used in any manner which, in the opinion of Bond Counsel to the City, will not adversely affect the exclusion of interest on the Bonds from gross income for federal income tax purposes. If not otherwise used or said opinion is not delivered, said money remaining in the Capital Projects Fund shall be deposited into the Principal Account and Interest Account in the Sinldng Fund and used solely for purposes thereof. WPB-FSILS05506v09\I6787,011300 25 Resolution No. 61-04 The proceeds of the sale of the Bonds shall be and constitute trust funds for the purposes hereinabove provided and there is hereby created a lien upon such moneys, until so applied, in favor of the Holders of said Bonds. SECTION 12. SECURITY FOR THE BONDS. That in each year while any of the Bonds are outstanding and unpaid, there shall be levied and collected a tax on all the taxable property within the City sufficient in an amount to pay the interest on the Bonds as it becomes due, and to provide for the payment of the principal of said Bonds at their maturity or earlier redemption, and the City is, and shall be irrevocably and unconditionally obligated to levy and collect such ad valorem taxes without limitation as to rate or amount on all the taxable property within the City, sufficient in amount to pay all principal of and interest on said Bonds, as the same shall become due. SECTION 13. COVENANTS OF THE CITY. As long as any of the principal of or interest on any of the Bonds shall be Outstanding and unpaid, or until there shall have been set apart in the Sinking Fund, consisting of the Interest Account and Principal Account, herein created and established, a sum sufficient to pay, when due, the entire principal of the Bonds remaining unpaid, together with interest accrued and to accrue thereon, or until the provisions of Section 13.D of this Resolution have been complied with, the City covenants with the Holders of any and all of the Bonds issued pursuant to the Resolution as follows: A. TAX COVENANT. 1. The City covenants to comply with each requirement of the Code, and any successor provisions thereto, necessary to maintain the exclusion of the interest on the Bonds from gross income for federal income tax purposes pursuant to Section 103(a) of the WPB-FSIXS05506v09\I6787.011300 26 Resolution No. 61-04 Code. In furtherance of the covenant contained in the preceding sentence, the City agrees to comply with the provisions of the Tax Certificate. 2. The City shall make any and all payments required to be made to the United States Department of the Treasury in connection with the Bonds pursuant to Section 148(f) of the Code from amounts on deposit in the fund and accounts established under this Resolution and available therefor. 3. Notwithstanding any other provision of this Resolution to the contrary, as long as necessary in order to maintain the exclusion of interest on the Bonds from gross income for federal income tax purposes, the covenants contained in this Section shall survive the payment of the Bonds, including any payment or defeasance thereof pursuant to Section 13.D of this Resolution. B. AD VALOREM TAX. In each year, while any of the Bonds are outstanding and unpaid, the City covenants that there shall be levied and collected a tax on all the taxable property within the City sufficient to pay the interest on the Bonds as it becomes due, and to provide for the payment of the principal of said Bonds and redemption premium, if any, when due and payable, and the City is, and shall be irrevocably and unconditionally obligated to levy and collect such ad valorem taxes without limitation as to rate or amount on all the taxable property within the City, sufficient in amount to pay all principal of and redemption premium, if any, and interest on said Bonds as the same shall become due and payable. C. CREATION AND ESTABLISHMENT OF A SINKING FUND AND VARIOUS ACCOUNTS AND THE DISPOSITION OF MONEYS. There are hereby created and established the following fund and accounts: WPB-FSILS05506v09\I6787.011300 27 Resolution No. 61-04 THE "SINKING FUND" All of the moneys raised by the City from the ad valorem taxes on the taxable property within the City for the purpose of paying the principal of and redemption premium, if any, and interest on the Bonds herein authorized shall be deposited by the City in a special fund to be known as the "Sinking Fund" which is hereby created and established. The moneys in said Sinking Fund shall be used solely for the payment of the principal of and redemption premium, if any, and interest on said Bonds as the same become due and payable and the registered owners of said Bonds shall have a first lien on all such moneys in the Sinking Fund until paid and applied in the manner permitted in this Resolution. There are also hereby created and established two (2) separate accounts in the Sinking Fund to be known as the "Interest Account" and the "Principal Account." The moneys at any time on deposit in the Sinking Fund disposed of only in the following manner: 1. Moneys shall first be used; to the full extent necessary, for deposit into the Interest Account in the Sinking Fund to pay interest becorrdng due on the Bonds on the next semiannual interest payment date; provided, however, that deposits for interest shall not be required to be made into the Interest Account to the extent that money on deposit therein is sufficient for such purpose. 2. Moneys shall next be used, to the full extent necessary, for deposit into the Principal Account in the Sinking Fund to provide for the required principal amount maturing and becoming due on the next principal payment date; provided, however, that deposits for principal shall not be required to be made into the Principal Account to the extent that money on deposit therein is sufficient for such purpose. WPB-FSB50SS06v09\16787.011300 28 Resolution No. 61-04 3. The City shall, to the extent of any moneys in any term Bond subaccount within the Principal Account, be mandatorily obligated to use such moneys for the redemption prior to maturity of term Bonds, if any, in such manner and at such times as shall hereafter be determined by subsequent proceedings of the Commission. 4. The Sinking Fund and the accounts therein shall constitute a trust fund of the City. The amounts required to be accounted for in the Sinking Fund and each of the accounts designated herein, may be deposited in a single bank account maintained by the City provided that adequate accounting procedures are maintained to reflect and control the restricted allocations of the amounts on deposit therein for the various purposes of such fund and accounts as herein provided. The designation and establishment of a fund and accounts in and by this Resolution shall not be construed to require the establishment of any completely independent fund and accounts but rather is intended solely to constitute an allocation of moneys collected by the imposition of ad valorem taxes. 5. Moneys on deposit in the Sinking Fund may be invested in U. S. Obligations or any other Permitted Investments (provided that Permitted Investments other than U. S. Obligations shall be fully collateralized with U.S. Obligations) maturing not later than such date or dates as the City shall determine. 6. All income and earnings received from the investment and reinvestment of moneys on deposit in the Principal Account and Interest Account in the Sinking Fund shall be retained therein and shall be a credit against deposits required by this Resolution. D. DISCHARGE AND SATISFACTION OF BONDS. The covenants, liens and pledges entered into, created or imposed pursuant to this Resolution may be fully discharged and satisfied with respect to the Bonds in any one or more of the following ways: WPB-FSI~505506v09\16787.011300 29 Resolution No. 61-04 1. by paying the principal of and interest on Bonds when the same shall become due and payable; or 2. by depositing in the Interest Account and Principal Account, or in such other accounts which are irrevocably pledged to the payment of the Bonds, as the City may hereafter create and establish by resolution, certain moneys, which together with other moneys lawfully available therefor, shall be sufficient at the time of such deposit to pay the Bonds, the interest thereon and the redemption premium, if any, as the same become due on said Bonds on the maturity or earlier redemption date thereof; or 3. by depositing in the Interest Account and Principal Account or such other accounts which are irrevocably pledged to the payment of the Bonds as the City may hereafter create and establish by resolution, moneys which together with other moneys lawfully available therefor when invested in Defeasance Obligations will provide moneys which shall be sufficient to pay the Bonds, the interest thereon and the redemption premium, if any, as the same shall become due on said Bonds on or prior to the maturity or earlier redemption date thereof. 4. Notwithstanding the foregoing all references to the discharge and satisfaction of Bonds shall include the discharge and satisfaction of any issue of Bonds, any portion of an issue of Bonds, any maturity or maturities of an issue of Bonds, any portion of a maturity of an issue of Bonds or any combination thereof. 5. If any portion of the moneys deposited for the payment of the principal of and redemption premium, if any, and interest on any portion of Bonds is not required for such purpose, the City may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under this Resolution. WPB-FSI~505506v09\16787.011300 30 Resolution No. 61-04 Upon such payment or deposit in the amount and manner provided in this Section 13.D, the Bonds shall no longer be deemed to be Outstanding for the purposes of the Resolution, and all liability of the City with respect to the Bonds shall cease, terminate and be completely discharged and extinguished, and the Holders thereof shall be entitled for payment solely out of the moneys or securities so deposited. Notwithstanding the foregoing, in the event that the payment or deposit in the amount and manner provided in this Resolution has been made by the Bond Insurer, if any, under the terms of a Bond Insurance Policy, the Bond Insurer shall be subrogated to the rights of the Holders of the Bonds, and the liability of the City, with respect thereto, shall not be discharged or extinguished. Notwithstanding any provisions contained in this Section 13.D to the contrary, the City may, with an opinion of nationally recognized bond counsel, purchase such Bonds that have been deemed discharged and satisfied within the meaning of this Section 13.D and thereby be permitted to use such excess moneys, resulting from such pumhase, free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds. SECTION 14. RULE 15c2-12 UNDERTAKING. That in order to assist the initial pumhasers of the Bonds with respect to compliance with the Rule, the City undertakes and agrees to provide the information described below to the persons so indicated. The City's Undertaking set forth in this Section 14 shall be for the benefit of the registered owners and beneficial owners (as such term is described below) of the Bonds. A. The City undertakes and agrees to provide to each NRMSIR and to the State of Florida information depository (herein, the "SID") if and when such a SID is created, the City's general purpose financial statements generally consistent with the financial statements WPB-FS lxS0ss06v09\I6787.011300 3 1 Resolution No. 61-04 presented as an appendix to the official statement relating to the Bonds (herein the "Official Statement"). The information referred to above is herein referred to as the "Annual Information." B. The Annual Information described in paragraph A above in audited form (for as long as the City provides such financial information in audited form) is expected to be available on or before March 31 of each year for the Fiscal Year ending on the preceding September 30, commencing March 31, 2005 for the Fiscal Year ending on the preceding September 30, 2004. The Annual Information referred to in paragraph A above in unaudited form (if the audited financial statements are not available or if the City no longer provides such financial information in audited form) will be available on or before March 31 for the Fiscal Year ending on the preceding September 30. The City also agrees to provide the Annual Information to each registered owner and Beneficial Owner of the Bonds who request such information and pays to the City its costs of reproduction and transmission of such Annual Information. The City agrees to provide to each NRMSIR and the SID, if any, timely notice of its failure to provide the Annual Information. Such notice shall also indicate the reason for such failure and when the City reasonably expects such Annual Information will be available. C. The Annual Information referred to in paragraph A above and presented as an appendix to the Official Statement has been prepared in accordance with governmental accounting standards promulgated by the Government Accounting Standards Board, as in effect from time to time, as such principles are modified by generally accepted accounting principles, promulgated by the Financial Accounting Standards Board, as in effect from time to time, and such other State mandated accounting principles as in effect from time to time. WPB-FSlkS05506v09\I6787.011300 32 Resolution No. 61-04 D. If, as authorized by paragraph F below, the City's Undertaking with respect to paragraph C above requires amending, the City undertakes and agrees that the Annual Information described in paragraph A above for the Fiscal Year in which the amendment is made will, to the extent possible, present a comparison between the Annual Information prepared on the basis of the new accounting principles and the Annual Information prepared on the basis of the accounting principles described in paragraph C above. The City agrees that such a comparison will, to the extent possible, include a qualitative discussion of the differences in the accounting principles and the impact of the change on the presentation of the Annual Information. E. The City undertakes and agrees to provide, in a timely manner, to each NRMSIR or to the Municipal Securities Rulemaking Board and to the SID, if any, notice of the occurrence of any of the following events with respect to the Bonds, if material: 1. principal and interest payment delinquencies; 2. non-payment related defaults; 3. unscheduled draws on any reserve account reflecting financial difficulties; 4. unscheduled draws on credit enhancements reflecting financial difficulties; 5. substitution of credit or liquidity providers, or their failure to perform; 6. adverse tax opinions or events affecting the tax-exempt status of the Bonds; 7. modifications to rights of Bondholders; WPB-FSDS05506v09\16787.011300 33 Resolution No. 61-04 8. Bond calls (other than scheduled mandatory sinking fund redemptions); 9. defeasance of the Bonds; 10. release, substitution, or sale of property securing repayment of the Bonds; 11. rating changes; and 12. any failure to comply with the provisions of this Section 14, which in all cases, such failure will be deemed material. Notwithstanding the foregoing, notice of the events described in clauses (8) and (9) above need not be given any earlier than the time notice is required to be given to the registered owners of the Bonds. F. Notwithstanding any other provision of this Resolution to the contrary regarding amendments or supplements, the City undertakes and agrees to amend and/or supplement this Section 14 (including the amendments referred to in paragraph D above) only iff 1. The amendment or supplement is made only in connection with a change in circumstances existing at the time the Bonds were originally issued that arises from (i) a change in law, (ii) SEC pronouncements or interpretations, (iii) a judicial decision affecting the Rule or (iv) a change in the nature of the City's financial condition. 2. The City's Undertaking, as amended, would have complied with the requirements of the Rule at the time the Bonds were originally WPB-FSlkS05506v09\16787.011300 34 Resolution No. 61-04 issued after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and 3. The amendment or supplement does not materially impair the interests of the registered owners and Beneficial Owners of the Bonds as determined by Bond Counsel or by a majority of the registered owners of the Bonds. In the event of an amendment or supplement under this Section 14, the City shall describe the same in the next report of Annual Information and shall include, as applicable, a narrative explanation of the reason for the amendment or supplement and its impact, if any, on the financial information and operating data being presented in the Annual Information. G. The City's Undertaking as set forth in this Section 14 shall terminate if and when the Bonds are paid or deemed paid within the meaning of this Resolution. H. The City acknowledges that its Undertaking pursuant to the Rule set forth in this Section 14 is intended to be for the benefit of the registered holders and Beneficial Owners of the Bonds and shall be enforceable by such holders and Beneficial Owners; provided that, the holder's and Beneficial Owners' right to enforce the provisions of this Undertaking shall be limited to a right to obtain specific enforcement of the City's obligations hereunder, and any failure by the City to comply with the provisions of this Undertaking shall not be or constitute a covenant or monetary default with respect to the Bonds under this Resolution. For purposes of this Section 14 only, Beneficial Owner shall mean any person which (i) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries) or (ii) is treated as the owner of any Bonds for federal income tax purposes. WPB-FSIXS05506v09\16787.011300 35 Resolution No. 61-04 I. The City reserves the right to satisfy its obligations under this Section 14 through agents; and the City may appoint such agents without the necessity of amending this Resolution. The City may also appoint one or more employees of the City to monitor and be responsible for the City's Undertaking hereunder. SECTION 15. BOOK-ENTRY SYSTEM A. As long as the Bonds are registered under the Book-Entry System, the City and the Registrar, as the case may be, shall comply with the terms of the agreements with the Securities Depository (collectively, the "Book-Entry Agreement"). However, the Book-Entry System through the Securities Depository may be terminated upon the happening of any of the following: 1. The Securities Depository or the City, based upon advice from the Securities Depository, advise the Registrar that the Securities Depository is no longer willing or able to properly discharge its responsibilities under the Book-Entry Agreement and the Registrar and the City are unable to locate a qualified successor clearing agency satisfactory to the Registrar and the City; or 2. The City, in accordance with the procedures and requirements of the Securities Depository, elects to terminate the Book-Entry System by notice to the Securities Depository and the Registrar. B. Upon the occurrence of any event described above, (i) the City and the Registrar shall, if necessary, enter into a resolution supplemental to this Resolution to add to the provisions of this Resolution any provisions deemed reasonably necessary or required by the Registrar with respect to Replacement Bonds (including, but not limited to, the provision for the WPB-FSIXS05506v09\16787.011300 36 Resolution No. 61-04 cost and expenses for the printing thereof) and to account for the fact that, themafier, the Bonds will no longer be registered under the Book-Entry System, and (ii) the Registrar shall notify the Securities Depository of the occurrence of such event and of the availability of definitive or temporary Replacement Bonds to Beneficial Owners requesting the same, in an aggregate Outstanding amount representing the interest of each such Beneficial Owner, making such adjustments and allowances as it may find necessary or appropriate as to accrued interest and previous payments of principal. Definitive Replacement Bonds shall be issued only upon surrender to the Registrar of the Bond of each maturity by the Securities Depository, accompanied by registration instructions for the definitive Replacement Bonds for such maturity from the Securities Depository. Neither the City nor the Registrar shall be liable for any delay in delivery of such instructions and conclusively may rely on, and shall be protected in relying on, such instructions. C. Whenever the Bonds are registered under the Book-Entry System and notice or other communication to the Bondholders is required under this Resolution, unless and until definitive Replacement Bonds shall have been issued with respect to the Bonds, the City or the Registrar, as the case may be, shall give to the Securities Depository one copy of each such notice and communication specified herein or required by this Resolution to be given to the Beneficial Owners of the Bonds. SECTION16. MODIFICATION OR AMENDMENT. Except as otherwise provided in the second paragraph hereof, no material modification or amendment of this Resolution, or of any resolution amendatory thereof or supplemental thereto, may be made without the written consent of the Bond Insurer and the consent in writing of the Holders of two- thirds or more in principal amount of the Bonds then Outstanding; provided, however, that no WPB-FSBS05506v09\16787.011300 37 Resolution No. 61-04 modification or amendment shall permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon, or affecting the unconditional promise of the City to levy, assess and collect an ad valorem tax without limitation as to rate or amount upon all taxable property in the City or to pay the interest of and principal on the Bonds, as the same mature or become due, from said ad valorem tax, or reduce the percentage of Holders of Bonds required above for such modification or amendments, without the consent of the Holders of all the Bonds. This Resolution may be amended, changed, modified and altered without the consent of the Holders of Bonds, but with written notice to the Bond Insurer, (i) to cure any ambiguity, correct or supplement any provision contained herein which may be defective or inconsistent with any other provisions contained herein, (ii) to implement a book-entry system of registration, (iii) to provide other changes which will not adversely affect the interest of such Holders of Bonds, or (iv) to amended the Undertaking pursuant to Section 14 hereof. Copies of all amendments, modifications or changes to this Resolution shall be provided to Standard & Poor's. For purposes of this Section 16, to the extent the Bonds are insured by a Bond Insurance Policy and such Bonds are then rated in as high a rating category in which such Bonds were rated at the time of initial issuance and delivery thereof, by both Standard & Poor's and Moody's Investors Service, Inc., then the consent of the Bond Insurer may constitute the consent of the Holders of the Bonds, provided such Bond Insurer agrees to give consent under such circumstances and is not in default under the Bond Insurance Policy. SECTION 17. SEVERABILITY OF INVALID PROVISIONS. If any one or more of the covenants, agreements or provisions of this Resolution should be held contrary to any express provision of law or contrary to the policy of express law, though not expressly WPB-FSIXS05506v09\16787.011300 38 Resolution No. 61-04 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 separate from the remaining covenants, agreements or provisions, and shall in no way affect the validity of any of the other provisions of the Resolution or of the Bonds or coupons issued hereunder. SECTION 18. SALE OF BONDS. The Bonds shall be issued and sold at one time or from time to time, in such manner and at such price or prices consistent with the provisions of the Act and the requirements of the Commission as shall hereafter be determined by subsequent proceedings. SECTION 19. BOND ANTICIPATION NOTES. The City may, if it determines it to be in its best financial interest, issue its bond anticipation notes in order to temporarily finance the cost of the Projects. The City shall by proper proceedings authorize the issuance and establish the details of such bond anticipation notes pursuant to the provisions of Section 215.431, Florida Statutes, as amended. In connection with such bond anticipation notes, the City is hereby authorized to enter into line of credit agreements, loan agreements or similar arrangements (collectively referred to as "Financing Agreement") with banks or similar financial institutions for the purpose of financing the costs of the Projects. The City is authorized to issue one or more bond anticipation notes to such banks or financial institutions to evidence its obligation to repay loans made under such Financing Agreements. SECTION 20. PRELIMINARY OFFICIAL STATEMENT AND NOTICE OF SALE. The City is hereby authorized to distribute (both in paper form or electronically) a preliminary official statement relating to marketing of the Bonds and publish a notice of sale as required under applicable law. Such distribution and publication may be accomplished using thc world-wide web. The Mayor, the Vice Mayor, the City Manager, the Finance Director or the weB-rs~xsosso6vogx~67s?.o~ t3oo 39 Resolution No. 61-04 Treasurer are each authorized to deem the preliminary official statement relating to the Bonds "final" within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934. SECTION 21. REMEDIES. Any Bondholder, to the full extent permitted by the laws of the State of Florida or the United States of America, may sue to protect and enforce any and all legal rights; to seek the appointment of a receiver, and to enforce and compel the performance of all duties required by this Resolution. SECTION 22. EFFECTIVE DATE. This Resolution shall take effect upon the passage in the manner provided by law. Passed and adopted in regular session this 7th day of September, 2004. CITY OF DELRAY BEACH, FLORIDA (SEAL) By: ATTEST: City Clerk The foregoing Resolution and bond form is hereby approved by me as to form, language and execution, this 7th day of September, 2004. By: City Attorney WPB-FSI~505506v09\I6787.011300 40 Resolution No. 61-04 AGENDA ITEM NUMBER: AGENDA REQUEST Date: September 1, 2004 Request to be placed on: Consent Agenda __ Special Agenda __ Workshop Agenda When: September 7, 2004 Description of agenda item: Approve Resolution #61-04 and #62-04 authorizing the compe- tire sale of General Obligation Bonds not to exceed $14,000,000, providing for the allocation of proceeds consistent with Resolution# 72-03 (relative to the January 2004 bond referendum), and providing for other matters deemed necessary and proper in connection with the bonds. ORDINANCE/RESOLUTION REQUIRED: YES NO Draft of Resolution Attached: X YES NO Recommendation: Recommend approval of the above. Department Head Signature: ,/~,/Z/~,<~4-~ Determination of Consistency with Comprehensive Plan: City Attorney Review/Recommendation (if applicable): Budget Director Review (required on all Items involving expenditure of funds): Funding available: Yes No Funding alternatives (if applicable): n/a Account Number: Account Description: Account Balance: City Manager Review: Approved for Agenda: ~ ~ No Hold Until: ' Agenda Coordinator Review: Received: Action: Approved: Disapproved: P.O. #