Res 54-95 RESOLUTION NO. R-54-95
A RESOLUTION OF THE CITY COMMI~qSION OF THE CITY OF
DELRAY BEACH, FLORIDA, AMENDING AND SUPPLEMENTING
RESOLUTION NO. R-27-94; AUTHORIZING THE NEGOTIATED SALE
OF CITY OF DELRAY BEACH, FLORIDA, UTILITIF_~ TAX REVENUE
~ BONDS, SERIES 1995, IN THE AGGREGATE PRINCIPAL AMOUNT OF
$2,405,000; DETERMINING CERTAIN DETAH~S OF SAID BONDS;
PROVIDING FOR THE APPLICATION OF THE BOND PROCEEDS;
DECLARING THE CITY'S OFFICIAL INTENT TO SEEK
REIMBURSEMENT FOR CERTAIN CAPITALIZED EXPENDITURES
MADE AND TO BE MADE WITH RESPECT TO THE ACQUISITION OF
THE LAKEVIEW GOLF COURSE; APPROVING THE FORM OF, AND
AUTHORIZING THE EXECUTION AND DELIVERY OF A BOND
PURCHASE AGREEMENT TO EFFECT THE NEGOTIATED SALE OF
THE BONDS; APPROVING THE FORM OF AND AUTHORIZING THE
EXECUTION OF AN OFFICIAL STATEMENT IN CONNECTION WITH
THE OFFERING AND SALE OF THE BONDS AND APPROVING,
RATIFYING AND CONFIRMING THE DISTRIBUTION OF A
PRELIMINARY OFFICIAL STATEMENT BY THE UNDERWRITERS;
AWARDING THE BONDS TO THE UNDERWRITERS; APPOINTING A
PAYING AGENT; APPOINTING A REGISTRAR; PROVIDING FOR A
BOND INSURANCE POLICY FOR THE BONDS PROVIDED BY MBIA
INSURANCE CORPORATION, AND PROVIDING FOR CERTAIN
NECESSARY SUPPLEMENTS TO THE BOND RESOLUTION IN
CONNECTION THEREWITH; APPROVING THE FORM OF AND
AUTHORIZING THE EXECUTION AND DELIVERY OF A FINANCIAL
GUARANTY AGREEMENT IN CONNECTION WITH THE ISSUANCE OF
THE SURETY BOND BY MBIA INSURANCE CORPORATION;
DECLARING THE BONDS TO BE "QUALIFIED TAX-EXEMPT
OBLIGATIONS" WITHIN THE MEANING OF SECTION 265Co)(3)(B) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED; PROVIDING
FOR THE UNDERTAKING BY THE CITY REGARDING SECONDARY
MARKET DISCLOSURE AS REQUIRED BY RULE 15c2-12 OF THE
SECURITIES EXCHANGE COMMISSION; AUTHORIZING THE PROPER
OFFICERS OF THE CITY TO DO ALL OTHER THINGS DEEMED
NECESSARY OR ADVISABLE AS TO THE SALE AND DELIVERY OF
THE BONDS; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City Commission (the ~Commission~) of the City of Delray
Beach, Florida (the "City") did, on December 3, 1991, adopt Resolution No. 98-91, as amended
Res. No. R-54-95
and supplemented (herein, the 'Original Resolution'), for the purpose, among other things, of
authorizing the issuance from time to time of Utilities Tax Revenue Bonds to finance and
refinance municipal projects; and
WItEREAS, any term not otherwise defined in this Resolution shall have the
me_suing ascribed to such term in the Original Resolution;
WttEREAS, pursuant to the terms and provisions of the Original Resolution, the
City did, on February 5, 1992, issue its first series of obligations under the Original Resolution
designated as Utilities Tax Revenue Refunding and Improvement Bonds, Series 1992, in the
aggregate principal amount of $14,800,000 for the purposes authorized thereunder (herein, the
"Original Bonds"); and
WHEREAS, Article rll, Section 4.G of the Original Resolution provides that the
City may issue pa.ri.' passu additional Bonds if the conditions in such section are complied with;
and
WHEREAS, the Commission did, on March 22, 1994, adopt Resolution No. R-
27-94 (herein the ' 1994 Resolution") determining it to be in the best economic interest of the
City to issue pari passu additional Bonds on parity with the Original Bonds to finance the 1994
Project (as such term is defined in the 1994 Resolution) and authorized the issuance of
$8,500,000 in initial aggregate principal amount (herein the 'Authorized Amount") of pari passu
additional Bonds; and
WI-IEREAS, for the purpose of this Resolution, the Original Resolution and the
1994 Resolution are sometimes collectively referred to as the 'BoM ResolutionS; and
2 Res. No. R-54-95
WtiEREAS, pursuant to the terms and provisions of the Bond Resolution, the
City did, on November 10, 1994, issue its second series of obligations designated as Utilities
Tax Revenue Refunding and Improvement Bonds, Series 1994, in the aggregate principal mount
of $5,810,000 to finance the 1994 Project (herein, the "1994 Bonds"); and
WHEREAS, as a result of issuing the 1994 Bonds, the Authorized Amount has
been reduced to $2,690,000 (herein, the 'Remaining Authorized Amount'); and
WHEREAS, the City, using all or a portion of the Remaining Authorized
Amount, is desirous of issuing $2,405,000 in aggregate principal amount of its Utilities Tax
Revenue Bonds, Series 1995, pursuant to the terms and provisions of the Bond Resolution and
this Resolution (herein called the '1995 Bonds") for the purpose of financing (i) the cost of
acquiring, improving and equipping the Lakeview Golf Course and (ii) the costs of issuing the
1995 Bonds including, but not limited to, the payment of the premium for the Bond Insurance
Policy and Surety Bond (as such terms are herein defined) (herein the 1995 Projec0; and
WHEREAS, in connection with the City using all or a portion of the Remaining
Authorized Amount to issue the 1995 Bonds to finance the 1995 Project, the City is in receipt
of an opinion of Bond Counsel to the effect that the addition of the 1995 Project to the definition
of the 1994 Project will not adversely affect the tax-exempt status of the 1994 Bonds and that
the 1995 Project is a permitted capital project under the Act; and
WHEREAS, in connection with the issuance of the 1995 Bonds, the Commission
deems it necessary to amend and supplement the 1994 Resolution; and
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WItEREAS, the Bond Resolution provides that certain details of the 1995 Bonds
and certain other provisions of the Bond Resolution shall be determined by subsequent
proceedings of the City, which shall be deemed to be supplemental to the Bond Resolution; and
WHEREAS, the City has determined the details of the 1995 Bonds; and
WHEREAS, Smith Barney Inc. on behalf of Smith Barney, Inc. and Stifel,
Nicolaus & Company, Incorporated (collectively, the ~Underwriters~), has submitted to the City
a proposal in the form of a Bond Purchase Agreement (the ~Bond Purchase Agreement~),
attached hereto as Exhibit A, between the Underwriters and the City, to purchase the 1995
Bonds, a copy of which is hereby furnished to each of the City Commissioners; and
WHEREAS, pursuant to Section 218.385, Florida Statutes, an authorized officer
of Smith Barney Inc., on behalf of the Underwriters, has delivered to the City a disclosure
statement and truth-in-bonding statement, both of which are attached to or incorporated in the
Purchase Contract; and
WHEREAS, there has been prepared and submitted to the City a Preliminary
Official Statement, dated July 31, 1995, attached hereto as Exhibit B; and
WHEREAS, based on the advice of the City's financial advisor, it is in the best
interest of the City to accept the Bond Purchase Agreement and to award the 1995 Bonds to the
Underwriters; and
WHEREAS, the City's financial advisor has recommended in a letter, attached
hereto as Exhibit C, that the principal and interest on the 1995 Bonds be insured by a financial
guaranty insurance policy (the ~Bond Insurance Policy~) to be issued by MBIA Insurance
Corporation or any successor thereto (the ~Bond Insurer~) and that in lieu of required deposits
4 Res. No. R-54-95
flUo the Debt Service Reserve Account for the 1995 Bonds, a Reserve Account Credit Facility
Substitute, in the form of a debt s~rvice re,~rve fund surety bond to be issued by the Bond
Insurer (the 'Surety Bond') shall be provided with the coverage which will, together with
moneys on deposit in the Debt Service Reserve Account for th~ Original Bonds snd the 1994
Bonds, be equal to the Debt Service Reserve Requirement for the 1995 Bonds, the Original
Bonds and the 1994 Bonds; and
WHEREAS, the Commission has been advised that as a condition for the City
to receive the Surety Bond from the Bond Insurer, it is necessary for the City to enter into a
Financial Guaranty Agreement with the Bond Insurer, the form of which is attached hereto as
Exhibit D; and
WHEREAS, the Commission hereby adopts the recommendations of the City's
financial advisor regarding the Bond Insurance Policy and the Surety Bond; and
WHEREAS~ as a condition of obtaining the Bond Insurance Policy and Surety
Bond for the 1995 Bonds, it is necessary to amend and supplement the Bond Resolution; and
WHEREAS~ the Commission has been advised by Bond Counsel that effective
July 3, 1995, Rule 15¢2-12, as amended (the 'Rule') of the Securities Exchange Commission,
it is unlawful for a broker dealer or municipal securities dealer, which would include the
Underwriters, to purctmse or sell municipal securities, which includes the 1995 Bonds, unless
the issuer, whkh includes the City, has undetiaken in a written agreement (herein, the
'Undertakinl~') to provide to specified information repositories snnual financial information
relevant to the municipal securities and notice of certain specified material events; and
5 Res. No. R-54-95
WHEREAS, as a condition for the Underwriters to purchase the 1995 Bonds, as
set forth in the Bond Purchase Agreemem, and as required by the Rule, the City must provide
its Undertaking; and
WHEREAS, the Commission hereby determines to provide its Undertaking with
respect to the 1995 bonds in this Resolution; and
W}tEREAS, the City has incurred within the last 60 days and will incur prior to
the issuance of the 1995 Bonds certain capital expenditures with respect to the acquisition of the
Lakeview Golf Course; and
WHEREAS, such expenditures were paid and will be paid from the City's general
fund; and
WltEREAS, it is intended by the Commission that this Resolution constitutes the
official intent of the City as required under the Internal Revenue Code of 1986, as amended, to
seek reimbursement for such expenditures from a portion of the proceeds of the 1995 Bonds.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION
OF THE CITY OF DELRAY BEACH, FLORmA, AS FOLLOWS:
SECTION 1. DEFINITIONS. That, except as provided in the next succeeding
sentence, all capitalized terms used in this Resolution not otherwise defined shall have the
meanings ascribed to such terms in the Bond Resolution, unless the context clearly indicates
otherwise. The term 'Beneficial Owner', as used in Section 16 hereof, shall have the meaning
ascribed thereto in Rule 13d-3 promulgated by the Securities Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended.
6 Res. No. R-54-95
SECTION 2. PURPOSE AND BOND DESIGNATIONS. That the City hereby
time (i) to issue $2,405,000 ia the aggregate principal amount of its 1995
purpose of (a) financing the costs of the 1995 Project, (b) to pay the costs of
1995 Bonds, including paying the premium for the Bond Insurance Policy and
(ii) to designate such 1995 Bonds as its "Utilities Tax Revenue Bonds,
SECTION 3. DESCRIPTION OF THE 1995 Bonds. The 1995 Bonds shall
1995 shall bear interest payable on June 1, 1996, and semiannually thereafter
and June 1 of each year, and shall mature on June 1 of each of the years, ia the
the rates as follows:
Year Amount Interest Rate
1996 $ 70,000 3.800%
1997 50,000 4.000%
1998 75,000 4.100%
1999 80,000 4.200%
2000 80,000 4.300%
2001 85,000 4.500%
2002 90,000 4.600%
2003 95,000 4.700%
2004 100,000 4.875 %
2005 105,000 5.000%
2006 110,000 5.000%
2007 115,000 5.250%
2008 120,000 5.250%
2009 125,000 5.300%
2016 1,105,000 6.000%
7 Res. No. R-54-95
SECTION 4. REDEMPTION PROVISIONS. The 1995 Bonds maturing on
and prior to June 1, 2003, shall not be redeemable prior to their stated dates of maturity. The
1995 Bonds maturing on June 1, 2004, and thereafter are redeemable at the option of the City
from any legally available source, in part, in any order of maturity selected by the City, and by
lot within a maturity if less than an entire maturity is to be redeemed, on June 1, 2003, or at
any time thereafter, or as a whole, on June 1, 2003, or at any time thereafter, at the redemption
prices (expressed as percentages of the principal amount to be redeemed) set forth below,
together with accrued interest to the date fixed for redemption:
Redemption Period Redemption
(Both date.s inclusive) Price
June 1, 2003 to May 31, 2004 102%
June 1, 2004 to May 31, 2005 101%
June 1, 2005 and thereafter 100%
That the 1995 Bonds maturing on June 1, 2016, shall also be subject to mandatory
sinking fund redemption prior to maturity by lot, in such manner as the Registrar (as defined
herein) may deem appropriate, on June 1, 2010, and on June 1 of each year thereafter, at a price
of par plus accrued interest to the date of redemption, in the amount as follows:
Year Amount
2010 $130,000
2011 140,000
2012 150,000
2013 160,000
2014 165,000
2015 175,000
2016' 185,000
*Final Maturity
8 Res. No. R-54-95
Notice of redemption of the 1995 Bonds shall be mailed, postage prepaid, by the
Registrar not less than thirty (30) days before the date fixed for redemption to the registered
owners of any 1995 Bonds or portions of 1995 Bonds which are to be redeemed, at their
addresses as they appear fifteen (15) days prior to the date such notice is mailed on the
registration books of the City kept by the Registrar.
The Registrar also shall mail (by certified mail, return receipt requested) a copY
of such notice for receipt not less than two (2) days before the date notice of redemption is
mailed to the registered owners of the 1995 Bonds to the following: The Depository Trust
Company, 711 Stewart Avenue, Garden City, New York 11530; Midwest Securities Trust
Company, Capital Structures - Call Notification, 440 South LaSalle Street, Chicago, Illinois
60605; and The Philadelphia Depository Trust Company, Reorganization Division, 1900 Market
Street, Philadelphia, Pennsylvania 19103; Attention: Bond Department; provided, however, that
such mailing shall not be a condition precedent to such redemption and failure to mail any such
notice shall not affect the validity of any proceedings for the redemption of the 1995 Bonds.
The Registrar shall also provide notice, at the same time notice of redemption is given to the
Bondholders, to Kenny Information Systems Notification Service, 65 Broadway, 16th Floor,
New York, New York 10006, and Standard & Poor's Called Bond Record, 25 Broadway, New
York, New York 10004; provided, however, that such mailing shall not be a condition precedent
to such redemption and failure to mail any such notice shall not affect the validity of any
proceedings for the redemption of the 1995 Bonds.
9 Res. No. R-54-95
A second notice of redemption shall be given sixty (60) days after the redemption
date in the manner required above to the registered owners of redeemed 1995 Bonds which have
not been presented for payment within thirty (30) days after the redemption date.
Such notice of redemption shall set forth (i) the date fixed for redemption, (ii) the
redemption price to be paid, (iii)that such 1995 Bonds will be redeemed at the designated
corporate trust office of the Paying Agent (as herein defined), and the name, address and
telephone number of a contact person, (iv) if less than all of the 1995 Bonds shall be called for
redemPtion, the distinctive numbers, letters and CUSIP identification numbers, if any, of such
1995 Bonds to be redeemed, (v) in the ease of 1995 Bonds to be redeemed in part only, the
portion of the principal amount thereof to be redeemed, and (vi) any other information the City
or the Registrar deems relevant. In case any 1995 Bond is to be redeemed in part only, the
notice of redemption that relates to such 1995 Bond shall state also that on or after the
redemption date, upon surrender of the 1995 Bond, a new 1995 Bond or 1995 Bonds of the same
maturity, bearing interest at the same rate and in aggregate principal amount equal to the
unredeemed portion of such 1995 Bond, will be issued. Failure of the registered owner of any
1995 Bonds which are to be redeemed to receive any such notice shall not affect the validity of
the proceedings for the redemption of 1995 Bonds for which proper notice has been given.
Interest shall cease to accrue on any of the 1995 Bonds duly called for prior redemption if
payment of the redemption price has been duly made or provided for.
SECTION 5. APPLICATION OF 1995 BOND PROCEEDS. All moneys
received by the City from the sale of the 1995 Bonds originally authorized and issued pursuant
to this Resolution, shall be disbursed as follows:
10 Res. No. R-54-95
A. The accrued interest derived from the sale of the 1995 Bonds, together
with any moneys representing capitalized interest, shall be deposited into the Interest Account,
created and established under the Original Resolution and continued under the 1994 Resolution
and continued hereunder, and used for the purpose of paying interest on the 1995 Bonds, as the
same becomes due and payable.
B. The balance of the proceeds derived from the sale of the 1995 Bonds shall
be deposited in a fund in a bank or trust company in the State which is eligible under State laws
to receive deposits of City funds, which was created, established and designated as the
"Acquisition/Construction Fund," under the 1994 Resolution and continued hereunder. There
is hereby created and established in the Acquisition/Construction Fund a separate line item to
be known as the "1995 Cost of Issuance Cost Center," into which shall be deposited an amount
of the proceeds of the 1995 Bonds sufficient to pay the costs of issuance of 1995 Bonds,
including, but not limited to, payment of the premium for the Bond Insurance Policy and the
payment of the premium for the Surety Bond. The City is hereby authorized to permit the
Underwriters to pay directly to the Bond Insurer, from the proceeds of the 1995 Bonds, the cost
of the Bond Insurance Policy and Surety Bond. If, for any reason, the moneys in the
Acquisition/Construction Fund, or any part thereof, are not necessary for or are not applied to
the purposes of the 1995 Project, then such surplus proceeds shall be deposited, upon
certification of the City Manager, other than amounts allocated to the 1995 Cost of Issuance
Center, that such surplus proceeds are not needed for the purposes of the
Acquisition/Construction Fund, in the following order:
11 Res. No. R-54-95
First, to the Debt Service Reserve Account ia the Sinking Fund created and
established for the Original Bonds and continued for the 1994 Bonds and hereby further
continued for the 1995 Bonds, to the full extent necessary, either to reinstate any Reserve
Account Credit Facility Substitute on deposit therein, including, but not limited to the Surety
Bond, or, to deposit.additional moneys so that such deposit, together with such moneys already
on deposit therein, equals the Debt Service Reserve Requirement for the Original Bonds, the
1994 Bonds and the 1995 Bonds;
Second, to the Interest Account, Principal Account or Bond Redemption Account
ia the amounts, if any, determined by subsequent proceedings of the Commission; and
Third, the balance, if any, to be used by the City for any lawful municipal
purpose.
The moneys deposited in the Acquisition/Construction Fund may, pending their
use for the purposes provided ia this Resolution, be temporarily invested ia Permitted
Investments maturing not later than the dates on which such moneys will be needed for the
purposes of the Acquisition/Construction Fund. Subject to the provisions of the Code and the
applicable Tax Certificate, all the earnings and investment income from such investments shall
remain ia and become a part of said Acquisition/Construction fund and be used for the purposes
of the Acquisition/Construction Fund.
The proceeds of the sale of the 1995 Bonds shall be and constitute trust funds for
the purposes herelnabove provided, and there is already created a lien upon such moneys, until
so applied, ia favor of the Holders of the 1995 Bonds.
12 Res. No. R-54-95
SECTION 6. NEGOTIATED SALE. That the Commission hereby adopts the
recommendations of the City's f'mancial advisor, as described in a letter from the City's financial
advisor, dated the date of this Resolution and attached hereto as Exhibit C. The City hereby
f'mds that, due to the nature of the f'mancing and volatile market conditions, it would be in the
best interest of the City that the 1995 Bonds be sold on a negotiated basis.
SECTION 7. BOND PURCHASE AGREEMENT. That the Bond Purchase
Agreement for the 1995 Bonds, dated the date of this Resolution, between the City and the
Underwriters, as submitted to this meeting and attached hereto as Exhibit A, be and the same
hereby is approved and accepted, and the 1995 Bonds are hereby sold to the Underwriters at a
purchase price of $2,365,887.51 (representing the par amount of the 1995 Bonds, less
underwriters' discount of $32,758.49 and less original issue discount of $6,354, plus accrued
interest from August 1, 1995 to the date of delivery thereof), on the terms and conditions set
forth in the Bond Purchase Agreement, and the Mayor of the City or, in his absence, the Vice
Mayor is hereby authorized and directed to execute, and the Clerk of the City to attest (if so
required by the terms of the Bond Purchase Agreement), the Bond Purchase Agreement and to
deliver the same to the Underwriters.
SECTION 8. PRELIMINARY AND FINAL OFFICIAL STATEMENT. That
the Official Statement of the City to be dated the date of this Resolution, will be in substantially
the form of the Preliminary Official Statement presented to this meeting and attached hereto as
Exhibit B, with the such insertions and changes as shall be necessary to reflect the terms of the
1995 Bonds, as set forth in the Bond Purchase Agreement and as shall be approved by the
Mayor of the City (upon advice of Bond Counsel and the City Attorney) with such approval to
13 Res. No. R-54-95
be conclusively evidenced by their execution and delivery thereof, and the City hereby approves
the use of the final printed Official Statement by the Underwriters in connection with the
offering and sale of the 1995 Bonds, and the City hereby further approves the use by the
Underwriters of any supplement or amendment to the final printed Official Statement which is
necessary so that the final printed Official Statement does not include any untrue statement of
a material fact or does not omit to state any material fact necessary to make the statements
therein not misleading. The City hereby ratifies, approves and consents to the use by the
Underwriters of the Preliminary Official Statement in connection with the public offering of the
1995 Bonds attached hereto as Exhibit B. The Mayor of the City and the City Manager are
hereby authorized and directed to execute the Official Statement and any amendment or
supplement thereto, in the name and on behalf of the City, and thereupon to cause the Official
Statement and any such amendment or supplement to be delivered to the Underwriters.
SECTION 9. PAYING AGENT AND REGISTRAR. That NationsBank of
Florida, N.A., is hereby appointed as paying agent (the "Paying Agent") and registrar (the
"Registrar") for the 1995 Bonds. By the acceptance of such appointment, NationsBank of
Florida, N.A., agrees to comply with the terms of the Bond Insurance Policy and Surety Bond
applicable to it. The Paying Agent is hereby instructed to deliver a Demand for Payment (as
such term is defined in the Financial Guaranty Agreement) at least three (3) days prior to the
date moneys drawn under the Surety Bond is required to pay debt service on the 1995 Bonds.
The Paying Agem is hereby instructed to maintain adequate records, verified with the Bond
Insurer, as to the amount available to be drawn under the Surety Bond and as to the amounts
paid and/or owing by the City to the Bond Insurer pursuant to the terms of the Financial
14 Res. No. R-54-95
Guaranty Agreement. The City reserves the right to remove and replace the Paying Agent and
Registrar with a successor which is not unacceptable to the Bond Insurer.
SECTION 10. DISCLOSURE STATEMENTS. That the City does hereby fred
that the Underwriters have submitted the disclosure statement and troth-in-bonding statement
required by Section 218;385, Florida Statutes, copies of which are attached to or incorporated
in the Bond Purchase Agreement.
SECTION 11. BOND INSURANCE POLICY AND SURETY BOND. That,
based on the recommendations of the City's financial advisor, set forth in a letter attached hereto
as Exhibit C with respect to the 1995 Bonds, the Commission finds that obtaining the Bond
Insurance Policy and Surety Bond from the Bond Insurer is in the best interests of the City, and
the Commission hereby directs that the premium due on the Bond Insurance Policy and Surety
Bond be paid in accordance with the terms thereof. The City covenants to comply with the
terms and provisions of the Bond Insurer's commitment to provide the Bond Insurance Policy
and Surety Bond and covenants to comply with the payments procedure with respect to the Bond
Issuance Policy set forth below.
A. In the event that, on the second Business Day, and again on the Business Day
prior to the payment date on the 1995 Bonds, the Paying Agent has not received
sufficient moneys to pay all principal of and interest on the 1995 Bonds due on the
second following or following, as the case may be, Business Day, the Paying Agent shall
immediately notify the Insurer or its designee on the same Business Day by telephone or
telegraph, conf'n'med in writing by registered or certified mail, of the mount of the
deficiency.
15 Res. No. R-54-95
B. If the deficiency is made up in whole or in' part prior to or on the payment
date, the Paying Agent shall so notify the ln~rer or its designee.
C. In addition, if the Paying Agent has notice that any Bondholder has been
required to disgorge payments of principal or interest on the 1995 Bonds to a trustee in
Bankruptcy or creditors or others pursuant to a final judgment by a court of competent
jurisdiction that such payment constitutes a voidable preference to such Bondholder
within the meaning of any applicable bankruptcy laws, then the Paying Agent shall notify
the Insurer or its designee of such fact by telephone or telegraphic notice, confamed in
writing by registered or certified mail.
D. The Paying Agent is hereby irrevocably designated, appointed, directed and
authorized to act as attorney-on-fact for Holders of the 1995 Bonds as follows:
1. If and to the extent there is a deficiency in amounts required to pay
interest on the 1995 Bonds, the Paying Agent shall (a) execute and deliver to
State Street Bank and Trust Company, N.A., or its successors under the Bond
Insurance Policy (the 'Insurance Paying Agent'), in form satisfactory to the
Insurance Paying Agent, an instrument appointing the Insurer as agent for
such Holders in any legal proceeding related to the payment of such interest
and an assignment to the Insurer of the claims for interest to which such
deficiency relates and which are paid by the Insurer, (b) receive as designee
of the respective Holders (and not as Paying Agent) in accordance with the
tenor of the Bond Insurance Policy payment from the Insurance Paying Agent
with respect to the claims for interest so assigned, and (c) disburse the same
to such respective Holders; and
2. If and to the extent of a deficiency in amounts required to pay
principal of the 1995 Bonds, the Paying Agem shall (a) execute and deliver
to the Insurance Paying Agem in form satisfactory to the Insurance Paying
Agent an instnmaent appointing the Insurer as agent for such Holder in any
legal proceeding relating to the payment of such principal and an assignment
to the Insurer of any of the 1995 Bonds surrendered to the Insurance Paying
Agent of so much of the principal amount thereof as has not previously been
paid or for which moneys are not held by the Paying Agent and available for
such payment (but such assignment shall be delivered only if payment from
16 Res. No. R-54-95
the In.~ance Paying Agent is received), (b) receive as designee of the
respective Holders (and not as Paying Agent) in accordance with the tenor of
the Bond Insurance Policy payment therefor from the Insurance Paying Agent,
and (c) disburse the same to such Holders.
E. Payments with respect to claims for interest on and principal of the 1995
Bonds disbursed by the Paying Agent from the proceeds of the Bond Insurance Policy
shall not be considered to discharge the obligation of the Issuer with respect to such 1995
Bonds, and the Insurer shall become the owner of such unpaid 1995 Bonds and claims
for the interest in accordance with the tenor of the assignment made to it under the
provisions of this subsection or otherwise.
F. Irrespective of whether any such assignments executed and delivered, the
Issuer and the Paying Agent hereby agree for the benefit of the Insurer that:
1. They recognize that to the extent the Insurer makes payments, directly
or indirectly (as by paying through the Paying Agent), on account of principal
of or interest on the 1995 Bonds, the Insurer will be subrogated to the rights
of such Holders to receive the amount of such principal and interest from the
Issuer, with interest thereon as provided and solely from the sources stated in
this Resolution and the 1995 Bonds; and
2. They will accordingly pay to the Insurer the amount of such principal
and interest (including principal and interest recovered under subparagraph (ii)
of the fu'st paragraph of the Bond Insurance Policy, which principal and
interest shall be deemed past due and not to have been paid), with interest
thereon as provided in this Resolution and the 1995 Bonds, but only from the
sources and in the manner provided herein for the payment of principal of and
interest on the 1995 Bonds to Holders, and will otherwise treat the Insurer as
the owner of such rights to the amount of such principal and interest.
G. In connection with the issuance of ~ ~ additional Bonds, the Issuer shah
deliver to the Insurer a copy of the disclosure document, if any, circulated with respect
to such ~ari ~ additional Bonds.
17 Res. No. R-54-95
H. Copies of any amendments made to the documents executed in connection with
the issuance of the 1995 Bonds which are consented to by the Insurer shall be sent to
Standard & Poor's Rating Group.
I. The Insurer shall receive notice of the resignation or removal of the Paying
Agent and the appointment of a successor thereto.
J. The Insurer shall receive copies of all notices required to be delivered to
Bondholders and, on an annual basis, copies of the Issuer's audited financial statements.
Notices: Any notice that is required to be given to a holder of the 1995 Bonds or to
the Paying Agent pursuant to the Bond ResOlution shall also be provided to the Insurer.
All notices required to be given to the Insurer under the Bond Resolution shall be in
writing and shall be sent by registered or certified mail addressed to MBIA Insurance
Corporation, 113 King Street, Armonk, New York 10504 Attention: Surveillance.
SECTION 12. BANK QUALIFIED DESIGNATION. The Commission hereby
designates the 1995 Bonds as ~qualified tax-exempt obligations~ within the meaning of Section
265Co)(3)(B) of the Internal Revenue Code of 1986, as amended.
SECTION 13. FINANCIAL GUARANTY AGREEMENT. That the form,
terms and provisions of the Financial Guaranty Agreement between the City and MBIA
Insurance Corporation, substantially in the form attached hereto as Exhibit D, as submitted to
this meeting, be and the same are hereby approved and accepted. The Mayor of the City or,
in his absence, the Vice Mayor, is hereby authorized and directed to execute and deliver the
Financial Guaranty Agreement on behalf of the City in substantially the form submitted to this
meeting, with such changes, insertions and deletions thereto as are necessary or desirable for
18 Res. No. R-54-95
carrying out the purposes thereof as may be approved by the City Attorney and Bond Counsel,
the execution of said Financial Guaranty Agreement being conclusive evidence of such approval.
SECTION 14. AMENDMENTS AND SUPPLEMENTS TO ORIGINAL
RESOLUTION. Notwithstanding any provision in the Original Resolution to the contrary, as
a condition of obtaining the Bond Insurance and Surety Bond and for as long as the Bond Insurer
is not in default under the Bond Insurance Policy and/or Surety Bond, the City covenants as
follows: (i) not to issue pari p.assu additional Bonds pursuant to Article HI, Section 4.G. of the
Original Resolution, that bear interest at a variable rate without the express written coment of
the Bond Insurer, (ii) not to optionally redeem the 1995 Bonds or use any portion of the
proceeds of the Utilities Tax for general municipal purposes if amounts are due and owing the
Bond Insurer under the Financial Guaranty Agreement. In the event that the City obtains more
than one Reserve Account Credit Facility Substitute for the 1995 Bonds, one of which is the
Surety Bond, the Paying Agent shall, if moneys are required therefrom, to draw on such Reserve
Account Credit Facility Substitutes on a pro rata basis. At any time amounts on deposit in the
Debt Service Reserve Account is less than the Debt Service Reserve Requirement and the Surety
Bond has been drawn on, the City covenants to apply the first available proceeds of the Utilities
Tax to reimburse the Bond Insurer thereby reinstating the Surety Bond prior to making any cash
deposits to the Debt Service Reserve Account to cure such deficiency.
SECTION 15. AMENDMENT TO 1994 RESOLUTION. The Commission
hereby determines to treat the Debt Service Reserve Account established under the Original
Resolution for the Original Bonds as also the Debt Service Reserve Account for the 1995 Bonds,
notwithstanding anything to the contrary set forth in the 1994 Resolution and the Original
19 Res. No. R-54-95
Resolution. The Debt Service Reserve Requirement for the Original Bonds, the 1994 Bonds and
the 1995 Bonds is hereby established to be $1,881,357.55. Since only $1,616,934.97 is
presently on deposit in the Debt Service Reserve Account for the Original Bonds and the 1994
Bonds, the difference, in the amount of $264,422.58 shall be equal to the principal amount of
the Surety Bond.
SECTION 16. RULE 15c2-12 UNDERTAKING. That in order to assist the
Underwriters with respect to compliance with Rule 15c2-12 (herein, the ~Rule") promulgated
by the Securities and Exchange Commission (herein the ~SEC~) and as required by the terms
of the Bond Purchase Agreement, the City undertakes and agrees to provide the information
described below to the persons so indicated. The City's undertaking and agreement set forth in
this Section 16 shall be for the benefit of the registered owners and Beneficial Owners of the
1995 Bonds.
(1) The City undertakes and agrees to provide to each nationally recognized
municipal securities information repository (herein each referred to as a
"NRMSIR~) and to the State of Florida information depository (herein, the
'SID~) if and when such a SID is created (a) the City's general purpose financial
statements generally consistent with the financial statements presented in
Appendix B to the Official Statement and (b) the information concerning Utilities
Tax collections within the City with respect to electricity, telephone, gas and fuel
oil, the Utilities Tax rate or rates, exemptions from the Utilities Tax and
amendments to the Utilities Tax Ordinance generally consistent with the
information in the Official Statement under the heading ~IYrlLITIES TAXES~.
20 Res. No. R-54-95
The information referred to in clauses (a) and (b) is herein collectively referred
to as the "Annual Information".
(2) The Annual Information described in clause (a) of paragraph (1) 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, 1996 for the
fiscal year ending on the preceding September 30, 1995. The ,Annual Information
referred to in clause (a) of paragraph (1) above in unaudited form (if the audited
financial statements are not available or ff 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 1995 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, notice, within five business days
of March 31 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.
(3) The Annual Information referred to in clause (a) of l~agraph (1) above and
presented in Appendix "B" to the Official Statement has been prepared in
accordance with governmental accounting standards promulgated by the
Government Accouming Standards Board, as in effect from time to time, as such
21 Res. No. R-54-95
principles are modified by generally accepted' accounting principals, promulgated
by the Financial Accounting Standards Board, as in effect from time to time, and
such other State mandated accounting principle as in effect from time to time.
(4) If, as authorized by paragraph (6) below, the City's undertaking with respect to
paragraph (3) above requires amending, the City undertakes and agrees that the
Annual Information 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 (3) 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.
(5) 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 1995 Bonds,
if material:
(a) principal and interest payment delinquencies;
(b) non-payment related defaults;
(c) unscheduled draws on the Debt Service Reserve Account for the 1995
Bonds (including the Surety Bond) reflecting financial difficulties;
(d) unscheduled draws on the Bond Insurance Policy reflecting financial
difficulties;
22 Res. No. R-54-95
(e) substitution of the Bond Insurer, or its failure to perform;
(0 adverse tax opinions or events affecting the m-exempt status of the 1995
Bonds;
(g) modifications to rights of Bondholders;
(h) bond calls (other than scheduled mandatory sinking fund redemptions);
(i) defeasances of all or a portion of the 1995 Bonds;
0) release, substitution, or sale of property (i.e. Utilities Tax) securing
repayment of the 1995 Bonds; and
0c) rating changes.
For the purpose of this paragraph (5) the term 'timely manner" shall mean within
five business days after the City receives or has notice of the occurrence of such
event. Notwithstanding the foregoing, notice of the events described in clause (h)
and (i) above need not be given any earlier than the time notice is required by any
other section of the Bond Resolution to be given to the registered owners of the
1995 Bonds.
(6) Notwithstanding any other provision of this Resolution or the Original Resolution
to the contrary regarding amendments or supplements, the City undertakes and
agrees to amend and/or supplemem this Section 16 only if:
(a) The amendment or supplement is made only in connection with a change
in circumstances existing at the time the 1995 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 operatiom or the activities that generate the
Utilities Tax;
fo) The City's undertaking, as amended, would have complied with the
requirements of the Rule at the time the 1995 Bonds were originally
23 Res. No. R-54-95
issued after taking into account any amendments or interpretations of thc
Rule, as well as any change in circumstances; and
(c) Thc amendment or supplement docs not materially impair thc interests of
the registered owners and Beneficial Owners of the 1995 Bonds as
determined by Bond Counsel or by a majority of thc registered owners of
the 1995 Bonds.
(7) The City's undertaking as set forth in this Section 16 shall terminate if and when
the 1995 Bonds are paid or deemed paid within the meaning of the Original
Resolution.
(8) The City acknowledges that its undertaking pursuant to the Rule set forth in this
Section 16 is intended to be for the benefit of the registered holders and
Beneficial Owners of the 1995 Bonds and shall be enforceable by such holders
and Beneficial Owners; provided that, the holder's and Beneficial Owners' fight
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 1995 Bonds under the Bond
Resolution.
(9) The City reserves the fight to satisfy its obligations under this Section 16 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.
24 Res. No. R-54-95
SECTION 17. OFFICIAL INTENT; REIMBURSEMENT FOR PRIOR
CAPITAL EXPENDITURES. The statements contained in this Resolution with respect to the
reimbursement of the capital expenditures with respect to the acquisition of the Lakeview Golf
Course referred to in this Resolution are intended to be statements of official intent as required
by, and in conformance with, the provisions of Section 1.150-2(e) of the regulations of the
Internal Revenue Code of 1986, as amended (herein the "Regulations"). The City expects to
reimburse the expenditures referred to in this Resolution with a portion of the proceeds of the
1995 Bonds subsequent to the date hereof, and no funds from sources other than the
"reimbursement bond issue" (as such term has the meaning assigned to it under the Regulations)
portion of the 1995 Bonds are, or are reasonably expected to be, reserved, allocated on a long
term basis, or otherwise set aside by the City pursuant to the City's budget or financial policies
to pay for such expenditures. The City will, upon the receipt of the proceeds of the 1995 Bonds
(or within 30 days thereof), allocate in writing the amount of proceeds to the 1995 Bonds (i.e.,
the reimbursement bond issue) used to reimburse the prior capital expenditures referred to in this
Resolution.
SECTION 18. FURTHER AUTHOI~IZATIONS. That the Mayor, the Vice
Mayor, the City Manager, the Finance Director, the City Clerk, the City Attorney and any other
authorized official of the City, be and each of them is hereby authorized and directed to execute
and deliver any and all documents and instruments, including but not limited to any conditions
to obtain the Bond Insurance Policy, and to do and cause to be done any and all acts and things
necessary or proper for carrying out the transactions contemplated by this Resolution.
25 Res. No. R-54-95
SECTION 19. EFFECTIVE DATE. That this Resolution shall take effect
immediately upon its passage.
PASSED AND ADOPTED in regular session on this the 8th day of August,
1995.
CITY OF D~
By:
Attest:
City ~lerk' - F ~ Date of Adoption: August 8, 1995
26 Res. No. R-54-95
MEMORANDUM
TO: David T. Ha~r?e~/~~Manager
From: Joseph M. SaT~~Tector of Finance
Subject: Resolution # 54-95; 1995 Utility Tax Bond Issue
Date: August 4, 1995
The attached resolution provides for the negotiated sale of the above
referenced bonds; appoints a paying agent and registrar; provides for an
insurance policy for the issue; allows for a surety for the debt service
reserve; provides for the undertaking by the City regarding secondary
market disclosure; and provides for all things necessary to provide
financing through the sale of bonds for the Lakeview Golf Course.
Please note that an updated resolution with attachments will be submitted
at the Commission on August 8, 1995. Pricing information will not be
available until that date.
c: Rebecca $. O'Connor, Treasurer