Loading...
Res 63-90 RESOLUTION NO. 63-90 A RESOI/JTION OF THE CITY CONMISSION OF THE CITY OF D~I~AY BEACH, FLORIDA, AUTHORIZING THE ISSUANCE OF THE NOT EXCEED- ING $8,000,000 PRINCIPAL AMOUNT WATER AND SEWER REVENUE BOND ANTICIPATION NOTE, SERIES 1990A, OF THE CITY OF DELRAY BEACH, FLORIDA, PURSUANT TO A L~NE OF CREDIT MADE AVAILABLE THROUGH SUN BANK/SOUTH FLORIDA, NATIONAL ASSOCIATION, FOR THE PURPOSE OF PROVIDING SHORT ~ FINANCING FOR THE COST OF DESIGN, ENGINEERING AND CONSTRUCTION OF VARIOUS WATER AND SEWER CAPITAL IMPROVEMENTS TO THE. CITY'S COMBINED PUBLIC UTILITY; PROVIDING FOR THE TEI~HS AND PAYMENT OF SAID WATER AND SEWER REVENUE BOND ANTICIPATION NOTE, SERIES 1990A, AND THE RIGHTS, REMEDIES AND SECURITY OF THE OWNERS THEREOF; MAKING CERTAIN COV~4ANTS ~ TO THE ISSUANCE OF SAID WATER AND SEWER REVENUE BOND ANTICIPATION NOTE, SERIES 1990A; AUTHORIZING THE PROPER OFFICERS OF THE CITY TO DO ALL OTHER THINGS DEEMED NECESSARY OR ADVISABLE IN CONNECTION WITH THE ISSUANCE OF SAID NOTE; AND PI~OVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Commission (the "City Commission") of the City of Delray Beach, Florida (the "City"), duly adopted Resolution No. 46-90 on April 24, 1990 (the "Bond Resolution"), authorizing the issuance of not exceeding $8,000,000 Water and Sewer Revenue Bonds (the "Bonds") of the city for the purpose of financing certain addi- tions, extensions and improvements (the "Project" as more fully described herein) to the City's Combined Public Utility (as defined below); and WHEREAS, it may become necessary, in order to meet the requirements of the Project schedule, for the City to incur certain costs relating to design, engineering and construction of the Project prior to the date of the issuance of the Bonds; and WHEREAS, the city Commission has determined that it is in the best interest of the city to provide for the availability of short ter~., financing of the Project; and, WHEREAS, Sun Bank/South Florida, National Association (the "Bank"), has indicated its intention to make available to the City a closed-end line of credit (the "Line of Credit") pursuant to which the City could make drawings in an aggregate principal amount of not exceeding $8,000,000; and -1- Res. No. 63-90 94348.25.2788.06:5 WHEREAS, in light of the need to proceed with the Project, the City Commission believes it is in the best interest to proceed with a negotiated sale of the Note to the Bank; and WHEREAS, the City Commission has determined that it is nec- essary to authorize the issuance of the not exceeding $8,000,000 aggregate principal amount of City of Delray Beach, Florida, Water and Sewer Revenue Bond Anticipation Note, Series 1990A (the "Note"), for the purpose of financing the design, engineering and construction costs of the Project; and WHEREAS, the Note shall be secured by a pledge of and first lien on the proceeds of the Bonds, and a subordinate lien on the Net Revenues (as defined below) of the City's Combined Public Utility which lien shall be junior; inferior and subordinate in all respects to the City's $25,135,000 City of Delray Beach, Florida, Water and Sewer Refunding Revenue Bonds, Series 1988 (the "Original Bonds"), authorized pursuant to City Resolution No. 36-88 adopted by the City Commission on June 28, 1988, as amended, supplemented and restated by Resolution No. 39-88 adopted on July 12, 1988, as amended and supple- mented (the "Original Resolution"), and further, the lien of the Note on the Net Revenues shall also be junior, inferior and subordinate in all respects to the lien on such Net Revenues of a Reserve Account Credit Facility Substitute (as defined below). NOW, THEREFORE, be it resolved by the city Commission of the City of Delray Beach, Florida, as follows: ARTICLE I STATUTORY AUTHORITY; FINDINGS AND DEFINITIONS SECTION 1.1. AUTHORITY FOR q'[[fS RE~;¢)LUTJ.~,N. This Resolution is adopted pursuant to the provi, sions ,,f the Charter of the City of Delray Beach, Florida, as amended and supplemented, the Florida Constitution, Chapter 166 and Section 215.431, Florida Statutes, as amended and supplemented, and other applicable provi- sions of law. SECTION 1.2. FINDINGS. It is hereby ascertained, deter- mined and declared: A. That, in light of the need to finance the cost of design, engineering and construction of the Project, and in light of the complexity and short-term nature of this financing, the City finds that it is in the best interest of the City to enter into a negotiated sale of the Note to the Bank. -2- Res. No. 63-90 B. That the Note authorized herein shall have a first lien of the proceeds of the Bonds. C. That the cost of the Project shall be deemed to include, but not be limited to, the cost of construction and improve- ments, the cost of real estate, including easements and other inter- ests therein, or any other property real or personal, necessary therefor; administrative expenses; engineering, design and legal expenses; expenses for fiscal agents or financial services; expenses for plans, specifications and surveys; and such other expenses as may be necessary or incidental to the Project and the issuance of the Note herein authorized. D. That the principal of and interest on the Note shall be paid solely from the Pledged Revenues (as defined herein). SECTION 1.3. DEFINITIONS. That, as used herein, the fol- lowing terms shall have the following meanings unless the context otherwise clearly requires (provided however, that any capitalized term used herein and not otherwise described shall have the meaning ascribed to such terms in the Bond Resolution): (a) "Act" shall mean the Florida Constitution, Chapter 166 and Section 215.431 of the Florida Statutes, as amended and supple- mented, and the Charter of the City of Delray Beach, Florida, as amended and supplemented, and other applicable provisions of the law. (b) "Bank" shall mean Sun Bank/South Florida, National Association, the Noteholder. (c) "Bond Counsel" shall mean Mudge Rose Guthrie Alexander & Ferdon or any other firm of nationally recognized bond counsel selected by the Issuer. (d) "City" shall mean the City of Delray Beach, Florida, a municipal corporation in the County of Palm Beach, State of Florida, and its successors and assigns. (e) "Combined Public Utility" shall mean the Combined Water System and Sewer System of the City. (f) "City Commission" shall mean the duly constituted gov- erning body of the City. (g) "Code" shall mean the Internal Revenue Code of 1986, as amended, the applicable Treasury Regulations promulgated thereunder and any administrative or judicial interpretations of the -3- Res. ~Io. 63-90 same published in a form on which the City may rely as a matter of law. (h) "Debt Service Fund" shall mean the Delray Beach Water and Sewer Revenue Bond Anticipation Note Debt Service Fund, created and established pursuant to this Resolution and which is the fund in which the Pledged Revenues shall be deposited by the City for the payment of the Note. (i) "Interest Rate" shall mean the rate of interest on the Note which, when calculated on a 365-day basis, shall be equal to seven and eighty-six hundredths percent (7.86%) per annum. (j) "Maturity Date"" shall mean with respect to the prin- cipal of and interest on the Note, December 31, 1990. (k) "Net Revenues" shall mean the Gross Revenues remaining after deduction of Operating Expenses. (1) "Note" shall mean the not exceeding $8,000,000 aggre- gate principal amount of Water and Sewer Revenue Bond Anticipation Note, Series 1990A, authorized by this Resolution. (m) "Noteholder" or "Owner" or "Holder" or any similar term shall mean any person who shall be the registered owner of the Note outstanding under this Resolution. (n) "Operating Expenses" shall mean the expenses of oper- ating, maintenance and ordinary repairs of the Combined Public Utility and its Facilities (as defined in the Bond Resolution) and shall include, without limiting the generality of the foregoing, insurance premiums, administrative expenses of the City relating solely to the Combined Public Utility, and such other reasonable expenses as shall be in accordance with generally accepted accounting principles. "Operating Expenses" shall not include any allowance for depreciation or any extraordinary items arising from the early extin- guishment of debt. (o) "Paying Agent" shall mean the City's Finance Department or, if the City Commission shall so determine by subse- quent proceeding, any bank or trust company and any successor bank or trust company that may be appointed by the City to act as Paying Agent hereunder. (p) "Payment Date" shall mean the Maturity Date or any prior date the principal of the Note is optionally prepaid in whole or in part. -4- Res. No. 63-90 (q) "Pledged Revenues" shall mean, (i) the proceeds of the Bonds and (ii) the Net Revenues deposited in the Debt Service Fund (after all the deposits required by Section 4.D of Article III, Part I of the Original Resolution have been made by the City, subject to the prior lien on such moneys for the payment of the Original Bonds and reimbursement to the provider of the Reserve Account Credit Facility Substitute, if any). (r) "Project" shall mean the cost of the construction and acquisition of additions, extensions and improvements to the Combined Public Utility of the City, consisting of, but not being limited to odor abatement additions and modifications to the treatment and dis- posal system operated by the South Central Regional Wastewater Treatment and Disposal Board and the acquisition of any lands or interests therein or any other properties deemed necessary or conven- ient therefor; engineering costs relating to the City's water treat- ment plant conversion to lime softening; engineering costs, and legal and financing fees and expenses; the costs of issuance of the Note; expenses for estimates of costs and of revenues and expenses for plans, specifications and surveys, administrative expenses relating solely to such construction and acquisition. (s) "Registrar" shall mean the City's Finance Department or, if the City Commission shall so determine by subsequent proceed- ing, any bank or trust company and any successor bank or trust com- pany that may be appointed by the city to act as Registrar hereunder. (t) "Reserve Account Credit Facility Substitute" shall mean the surety bond provided by MBIA in connection with the Original Bonds. (u) "Resolution" shall mean this Resolution as the same may from time to time be amended and supplemented in accordance with the terms hereof. (v) "Revenues or "Gross Revenues" shall mean all rates, fees, charges, or other income, received by the City or any agency thereof in control of the management and operation of the Combined Public Utility, and all parts thereof, from the operation of the Combined Public Utility and shall also include the earnings and investment income derived from the investment of moneys on deposit in the various funds and accounts created and established under the Original Resolution, which by the terms and provisions of the Original Resolution are required to be deposited in the Revenue Fund and the Interest Account, provided, however, that Revenues shall not include (1) Pledged Impact Charges (2) Unpl~,~,,ed Impact Charges (3) Special Assessments and (4) capito~ contributions. -5- Res. No. 63-90 Words importing singular number shall include the plural number and vice versa, as the case may be, and words importing per- sons shall include firms and corporations. SECTION 1.4. RESOLUTION CONSTITUTES CONTRACT. In consid- eration of the acceptance of the Note authorized to be issued hereun- der by those who shall own the same from time to time, this Resolution shall be deemed to be and shall constitute a contract between the City and the Noteholder and the covenants and agreements herein and therein set forth to be performed by said City shall be for the benefit, protection and security of the Noteholder. ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF THE NOTE SECTION 2.1. AUTHORIZATION OF THE NOTE. Subject and pur- suant to the provisions of this Resolution, an obligation of the City to be known as "Water and Sewer Revenue Bond Anticipation Note, Series 1990A" is hereby authorized to be issued in the principal amount of not exceeding Eight Million Dollars ($8,000,000) for the purpose of providing short term financing for the costs of the Project. SECTION 2.2. DESCRIPTION OF THE NOTE. The text of the Note shall be substantially in the form attached hereto as Exhibit A with such omissions, insertions and variations as may be necessary and desirable, as evidenced by the City's execution thereof. The Note shall be dated the date of the first drawing. The Note shall bear interest on the outstanding principal amount of the Note from time to time at the Interest Rate payable on the Payment Date. With respect to any Payment Date prior to the Maturity Date, interest shall be payable only with respect to that portion of the outstanding principal amount of the Note that is actually redeemed. The principal of the Note and all accrued and unpaid interest on the Note shall be payable on the Maturity Date. The Note shall be issued in registered form. Principal and Interest shall be payable at the office of the Paying Agent (principal corporate trust office if the City's Finance Department is not the Paying Agent). The Note shall be num- bered in such manner as may be prescribed by the Registrar. The Note shall be payable, with respect to interest, principal and premium, if any, in any coin or currency of the United -6- Res. No. 63-90 States of America which at the time of payment is legal tender for the payment of public and private debts. The Note shall be subject to prepayment, at the option of the City, in whole or in part, at any time without Dremium or penalty. The Registrar shall provide written notice of prepayment to the Noteholder, at least two (2) days prior to the Payment Date. SECTION 2.3. EXECUTION OF THE NOTE. The Note shall be executed in the name of the City by the signature of the Mayor of the City and its official seal shall be affixed thereto or imprinted or reproduced thereon and attested by the City Clerk. The signatures of the Mayor of the City and City Clerk on the Note may be manual or facsimile signatures. In case any one or more of the officers who shall have signed or sealed the Note shall cease to be such officer of the City before the Note so signed and sealed shall have been actually sold and delivered, such Note may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Note had not ceased to hold such office. The Note may be signed and sealed on behalf of the City by such person who at the actual time of the execution of the Note shall hold the proper office, although at the date the Note shall be actually deliv- ered such person may not have held such office or may not have been so authorized. The Note shall bear thereon a certificate of authentica- tion, in the form set forth on Exhibit A attached hereto, executed manually by the Registrar (when the City's Finance Department shall act as Registrar, the certificate of authentication shall be manually executed by the City's Finance Director). Only the Note as shall bear thereon such certificate of authentication shall be entitled to any right or benefit under this Resolution and no Note shall be valid or obligatory for any purpose until such certificate of authentica- tion shall have been duly executed by the Registrar. The certificate of authentication of the Registrar upon the Note executed on behalf of the City shall be conclusive evidence that the Note so authenti- cated has been duly authenticated and delivered under this Resolution and that the Owner thereof is entitled to the benefits of.this Resolution. SECTION 2.4. N~OTIABI~/TY, R]~~ONAND CANCR~ZATION. At the option of the registered Owner thereof but subject to the prior written approval of the City's Director of Finance (which shall not be withheld if the intended transferee provides a suitability letter (as to the sophistication of the investor) addressed to the City) and upon surrender thereof at the office of the Registrar (principal corporate trust office if the City's Finance Department is not the Registrar) with a written instrument of tuansfer satisfactory to the Registrar duly executed by the registered Owner or his duly -7- Res. No. 63-90 authorized attorney and upon payment by the registered Owner of any charges which the Registrar may make as provided in this Section, the Note may be exchanged for another Note of the same maturity. The Registrar shall keep books for the registration of the Note and for the registration of transfers of the Note. The Note shall be transferable by the Owner thereof in person or by his/her 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 Owner or his/her duly authorized attorney. Upon the transfer of such Note, the City shall issue in the name of the trans- feree a new Note. The City, the Paying Agent and the Registrar may deem and treat the person in whose name the Note shall be registered upon the books kept by the Registrar as the absolute Owner of such Note, whether such Note shall be overdue or not, for the purpose of receiv- ing payment of, or on account of, the principal of and interest on such Note as the same become due and for all other purposes. All such payments so made to any such Owner or upon his/her order shall be valid and effectual to satisfy and discharge the liability upon such Note 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. In all cases in which the privilege of exchanging or trans- ferring the Note is exercised, the City shall execute and the Registrar shall authenticate and deliver the Note in accordance with the provisions of this Resolution. The Note 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 the Note, but the City or the Registrar may require the payment of a sum sufficient to pay any tax, fee or other governmental charges required to be paid with respect to such exchange or transfer. The Note paid or redeemed, either at or before maturity, shall be delivered to the Registrar when the payment or redemption is made, and such Note, shall thereupon be promptly cancelled. The Note 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 Note, and one executed certificate shall be filed with the City and the other executed cer- tificate shall be retained by the Registrar. SECTION 2.5. TffE N°TE MUTILATED, DESTROYED, STOf.E~ OR LOST. In case the Note shall become mutilated, destroyed, stolen or lost, the city may execute and the Registrar shall authenticate and deliver -8- Res. No. 63-90 a new Note of like date, maturity and denomination as the Note so mutilated, destroyed, stolen or lost; provided that, in the case of any mutilated Note, such mutilated Note shall first be surrendered to the City and, in the case of any lost, stolen or destroyed Note, 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 Note shall be about to mature or have matured, instead of issuing a duplicate Note, the City may pay the same without sur- render thereof. The City and the Registrar (if not the City's Finance Department) may charge the Owner of such Note their reason- able fees and expenses in connection with this transaction. Any Note surrendered for replacement shall be cancelled in the same manner as provided in Section 2.4 hereof. Any such duplicate Note issued pursuant to this Section shall constitute additional contractual obligations on the part of the City, whether or not the lost, stolen or destroyed Note be at any time found by anyone, and such duplicate Note shall be entitled to equal proportionate benefits and rights as to lien on the source and security for payment from the Pledged Revenues, with the Note issued hereunder. SECTION 2.6. CONDITIONS FOR DRAWING UNDER THE LINE OF CREDIT AND ISSUANCE OF THE NOTE. In connection with a drawing under the Line of Credit (a "Drawing") the following conditions will apply: (a) Except in the case of the initial Drawing, written notice of the City's intention to make a Drawing at least two (2) business days prior to the date specified for such Drawing (such notice shall indicate whether there has been any change in the Project and shall confirm that the City is in compliance with the covenants set forth in Section 3.3 hereof); and (b) In the event of a change in Project, the opinion of Bond Counsel, satisfactory to the Noteholder, that such Drawing shall not adversely affect the exclusion of interest on the Note from income for Federal income tax purposes; and (c) Only with respect to the first Drawing, a fully exe- cuted Tax Certificate, dated as of the date of such Drawing; and (d) Only with respect to the first Drawing, a copy of a completed and executed Form 8038-G to be filed with the Internal Revenue Service; and (e) Only with respect to the first Drawing, Opinion of Bond Counsel, satisfactory to the Noteholder, regarding the due -9- Res. No. 63-90 authorization, execution, delivery, validity and enforceability of the Note and the due adoption of the Resolution (enforceability of such instruments may be subject to standard bankruptcy exceptions and the like) and the exclusion of interest on the Note from gross income for Federal income tax purposes, that the Note is not a specified "private activity bond" within the meaning of Section 57(a)(5) of the Code and, therefore, the interest on the Note will not be treated as a preference item for purposes of computing the alternative minimum tax imposed by Section 55 of the Code (however, a portion of the interest on the Note owned by corporations may be subject to the Federal alternative minimum tax which is based in part on adjusted net book income or adjusted current earnings); and (f) Only with respect to the first Drawing, Opinion of Counsel to City, satisfactory to the Noteholder, regarding the due authorization, execution, delivery, validity and enforceability of the Note and the due adoption of the Resolution (enforceability may be subject to standard bankruptcy exceptions and the like). SECTION 2.7. GRID NOTATION. With respect to Drawings on the Line of Credit and repayments thereof, the city and the Bank shall make the appropriate notations on the "Grid" attached to the Note. The Grid shall be severable from the Note. ARTICLE III COVENANTS, FUNDS AND APPLICATION THER~)F SECTION 3.1. THE NOTE NOT TO BE INDUS OF THE CITY. The Note shall not be and shall not constitute an indebtedness of the City within the meaning of any constitutional, statutory, charter or other limitation of indebtedness but shall be payable solely from the Pledged Revenues, as provided in this Resolution. No Holder or Holders of the Note issued hereunder sh~l~ ever have the right to compel the exercise of the ad valorem t~×iug power of the City, or taxation in any form of any real p,-~perty ~herein to pay the Note or the interest thereon. The pledge ,~f tho ~'ledged Revenues shall not constitute a lien upon the Combine,] Pub]~,.' Utility or upon any other property whatsoever of or in the City. SECTION 3.2. NOTE SECURED BY PLEDGE OF PLEDGED REVENUES. From and after the issuance of the Note, and continuing until the payment of the Note as to principal and interest, the Pledged Revenues shall continue to be pledged for the prompt payment of prin- cipal of and interest on said Note. SECTION 3.3. COVENANTS OF THE CITY. As long as any of the principal of or interest on the Note shall be outstanding and unpaid, -10- Res. No. 63-90 or until there shall have been set apart in the Debt Service Fund in accordance with Section 3.6 hereof a sum sufficient to pay, when due, the entire principal of the Note remaining unpaid, together with interest accrued and to accrue thereon, the City covenants with the Noteholder as follows: A. Tax Covenants Relating to the Internal Revenue Code of 1986, as amended. 1. In order to maintain the exclusion from gross income for purposes of Federal income taxation of interest on the Note, the City covenants to comply with each requirement of the Code. In furtherance of the covenant contained in the preceding sen- tence, the City agrees to continually comply with the provisions of the "Tax Certificate as to Arbitrage and Instructions as to Compliance with the provisions of Section 103(a) of the Internal Revenue Code of 1986" to be executed by the City and delivered on the date of issuance and delivery of the Note, as such certificate may be amended from time to time as a source of guidance for achieving com- pliance with the Code. (2) The City covenants and agrees with the Noteholder that the City shall not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery.of the Note, would cause the Note to be a "private activity bond" or "arbitrage bond" within the meaning of Sections 141(a) and 148(a), respectively, of the Code. (3) Notwithstanding any other provision of this Resolution to the contrary, so long as necessary in order to maintain the exclusion from gross income for purposes of Federal income taxa- tion of interest on the Note, the covenants contained in this Section shall survive the payment of the Note and the interest thereon, including any payment or discharge thereof pursuant to Section 3.6 of the Resolution. B. Establishment of Debt Service Fund. There is hereby created and established the following fund entitled the "Delray Beach Water and Sewer Revenue Bond Anticipation Note Debt Service Fund" (hereinafter referred to as the "Debt Service Fund"). The Debt Service Fund shall constitute a trust fund for the benefit of the Noteholder and shall be held by the City and shall be kept separate and distinct from all other funds of the City, and shall be used only for the purpose and in the manner provided in this Resolution. Notwithstanding the provisions of the next preceding sentence, the City may deposit the Pledged Revenues in a single bank account for the City, provided that adequate accounting procedures are maintained to reflect and control the restricted allocations of the funds on deposit therein for the various purposes of such funds. The designation and establishment of the Debt Service Fund in and by this -11- Res. No. 63-90 Resolution shall not be construed to require the establishment of any completely independent self-balancing fund, as such term is commonly defined and used in governmental accounting, but rather is intended solely to constitute an allocation of certain revenues of the City for certain purposes and to establish certain priorities for applica- tion of such revenues as provided herein. Any excess amounts remaining in the Debt Servic~ Fund after payment has been made on the Note on the Maturity Date, ,~V be with- drawn and deposited at the direction of the City to be used for any lawful municipal purpose. Moneys on deposit in the Debt Service Fund may be invested in U. S. Obligations or such other obligations as are permitted by the applicable laws of the State of Florida, provided such invest- ments mature not later than the next succeeding Payment Date. Subject to the terms and provisions of the Code, all income and earn- ings received from the investment and reinvestment of the moneys on deposit in the Debt Service Fund shall remain on deposit in the Debt Service Fund and be used in the same manner as other moneys on deposit therein. C. Disposition of Pledged Revenues. The City covenants to deposit, on or prior to the Maturity Date, Pledged Revenues into the Debt Service Fund in an amount sufficient to pay the outstanding principal of and interest on the Note. SECTION 3.4. REMEDIES OF NOTEHOLDER. S hou id the City default in its obligation created by this Resolution, the Noteholders may, in addition to any remedy set forth in this Resolution, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State of Florida, or granted and con- tained in this Resolution, and may enforce and compel the performance of all duties required by this Resolution, or by any applicable stat- utes to be performed by the City or by any officer thereof. SECTION 3.5. APPLICATION OF NOTE PROCEEDS. The proceeds of the Note shall be used to provide short term financing of the costs of the Project. The City may substitute the Project for any other capital project permitted under the Act; provided that Bond Counsel shall first deliver to the City an opinion to the effect that the substitution of Project will not adversely affect the exclusion of interest on the Note from gross income for Federal income tax purposes. The proceeds of the ~;ote shall be deposited in the Construction Fund established pursuant to the terms and provisions of -12- Res. No. 63-90 such Bond Resolution and shall applied in accordance with the provisions of the Bond Resolution. SECTION 3.6. DISCHARGE AND SATISFACTION OF THE NOTE. The covenants, liens and pledges entered into, created or imposed pursu- ant to this Resolution may be fully discharged and satisfied with respect to the Note in any one or more of the following ways: (a) by paying the principal of and interest on the Note when the same shall becomes due and payable; or (b) by depositing in the Debt Service Fund or such other accounts as the City may hereafter create and establish by resolution ~moneys or U. S. obligations sufficient at the time of such deposit to pay the Note and all interest thereon on said Note on or prior to the maturity date thereof. ARTICLE IV MISCEI.T~%NEOUS PROVISIONS SECTION 4.1. MODIFICATION OR AMENDMENT. No ,T,n~.erial mod~.fication or amendment of this Resolution or of any resol,,tiun amendat,,,'¥ thereof or supplemental thereto, may be made wi. thout the c~,l,sent i~, w~ iting of all of the Noteholders; pro- vided, however, that no modification or amendment shall permit a change in the maturity of such Note or a reduction in the rate of interest thereon. This Resolution may be amended, changed, modified and altered without the consent of the Noteholder, (i) to cure any ambi- guity or correct any provision contained herein which may be defec- tive or inconsistent with any other provisions contained herein, (ii) to provide other changes which will not adversely affect the interest of such Noteholder, or (iii) to maintain the exclusion of interest on the Note from gross income for Federal income tax purposes. SECTION 4.2. ADDITIONAL AUTHORIZATION. The Mayor, the City Manager, the Finance Director and any other proper official of the City shall be, and each of them is hereby authorized and directed to execute and deliver any and all documents and instruments 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. -13- Res. No. 63-90 SECTION 4.3. 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 prohibit- ed, 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 cove- nants, agreements or provisions, and shall in no way affect the validity of any of the other provisions of this Resolution or of the Note issued hereunder. SECTION 4.4. PAYING AGENT AND REGISTRAR. T h e C i ty ' s Finance Department is hereby appointed to act as Paying Agent and Registrar for the Note. SECTION 4.5. AWARD OF THE NOTE. The City hereby awards the sale of the Note to the Bank, subject to successful completion of negotiations with the City's administrative staff, in accordance with the terms and provisions of this Resolution. SECTION 4.6. REPEALER. All resolutions and orders, or parts thereof, in conflict herewith are, to the extent of such con- flict, hereby repealed, and this Resolution shall take effect upon its passage in the manner provided by law. SECTION 4.7. EFFECTIVE DATE. This Resolution shall be effective immediately upon its adoption. Passed and adopted in regular session on this 26th day of June, 1990. · Mayor Attest: -~' City- C~{erk / The foregoing resolution and the form of Note therein con- tained are hereby approved by me as to form, language and execution this 26th day of June, 1990. -14- Res. No. 63-90 Exhibit A FORM OF NOTE No. R-__ UNITED STATES OF AMERICA STATE OF FLORIDA CITY OF DELRAY BEACH, FLORIDA Water & Sewer Revenue Bond Anticipation Note Series 1990A Interest Maturity Dated Rate Date Date % December 31, 1990 , 1990 Registered Owner: Principal Amount: [As Set Forth on the Grids] DOLLARS KNOW ALL MEN BY THESE PRESENTS, that the City of Delray Beach (the "City") in Palm Beach County, Florida, for value received, hereby promises to pay from the sources herein mentioned, to the Registered Owner specified above or registered assigns on the Maturity Date specified above, upon the presentation and surrender hereof at the City's Finance Department or (if so determined by the City) the corporate trust office of the bank or trust company appointed by the City to act as paying agent (said City's Finance Department or such bank or trust.company and any bank or trust com- pany becoming successor paying agent being herein called the "Paying Agent"), the Principal Amount specified above, with interest thereon at the Interest Rate specified above, on the Maturity Date in the manner specified in the within described Resolution to the registered owner. The Principal Amount and accrued interest thereon is payable in any coin or currency of the United States of America, which, on the dat~ ,-,f payment thereof, shall be legal tender for the payment of public and private debts. A-1 Res. No. 63-90 This Note is authorized to be issued in a principal amount of not exceeding $8,000,000 under the authority of and in full com- pliance with the Constitution and statutes of the State of Florida, including, particularly, Chapter 166 and Section 215.431, Florida Statutes, as amended and supplemented, the Charter of the City of Delray Beach, Florida, and other applicable provisions of law (the "Act"), and Resolution No. 63-90, duly adopted by the City on the 26th day of June, 1990 as such resolution may be amended and supple- mented from time to time, and is subject to all terms and conditions of said resolution (the "Resolution"). Any term used in this Note and not otherwise defined, shall have the meaning ascribed to such term in the Resolution. It is hereby certified and recited that all acts, condi- tions and things required to exist, to happen, and to be performed, precedent to and in the issuance of this Note 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 and the Charter of the City applicable thereto, and that the issuance of this Note, is in full compliance with all constitutional or statutory limita- tions or provisions. This Note shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Note Resolution until the certificate of authentication hereon shall have been signed by an authorized officer of the Registrar. This Note shall bear interest at the Interest Rate. Interest shall only be payable on December 31, 1990 (the "Maturity Date") or earlier optional prepayment (each a "Payment Date"). With respect to an optional prepayment of a portion of the outstanding principal of the Note, interest shall only be payable with respect to the principal of the Note repaid. The principal of and interest on the Note shall be payable solely from: (i) the pro- ceeds of the Bonds in anticipation of which this Note has been issued and (ii) the Net Revenues deposited in the Debt Service Fund (after all the deposits required by Section 4.D. of Article III, Part I of the Original Resolution have been made by the City, subject to the prior lien on such moneys for the payment of the Original Bonds and reimbursement to the provider of the Reserve Account Credit Facility Substitute) (collectively, the "Pledged Revenues"). "Bond Resolution" shall mean City Resolution No. 46-90 adopted by City on April 24, 1990. "Combined Public Utility" shall mean the Combined Water System and Sewer System of the City. A-2 Res. No. 63-90 "Net Revenues" shall mean the Gross Revenues remaining after deduction of Operating Expenses. "Operating Expenses" shall mean the expenses of operating, maintenance and ordinary repairs of the Combined Public Utility and its Facilities (as defined in the Bond Resolution) and shall include, without limiting the generality of the foregoing, insurance premiums, administrative expenses of the City relating solely to the Combined Public Utility, and such other reasonable expenses as shall be in accordance with generally accepted accounting principles. "Operating Expenses" shall not include any allowance for depreciation or any extraordinary items arising from the early extinguishment of debt. "Original Bonds" shall mean the $25,135,000 City of Delray Beach, Florida Water and Sewer Refunding Revenue Bonds, Series 1988. "Original Resolution" shall mean City Resolution No. 36-88 adopted by the City on June 28, 1988, as amended, supplemented and restated by Resolution No. 39-88 adopted on July 12, 1988, as amended and supplemented. "Reserve Account Credit Facility Substitute" shall mean the surety bond provided by MBIA in connection with the Original Bonds. "Revenues or "Gross Revenues" shall mean all rates, fees, charges, or other income, received by the City or any agency thereof in control of the management and operation of the Combined Public Utility, and all parts thereof, from the operation of the Combined Public Utility and shall also include the earnings and investment income derived from the investment of moneys on deposit in the vari- ous funds and accounts created and established under the Original Resolution, which by the terms and provisions of the Original Resolution are required to be deposited in the Revenue Fund and the Interest Account, provided, however, that Revenues shall not include (1) Pledged Impact Charges (2) Unpledged Impact Charges (3) Special Assessments and (4) capital contributions. The City may prepay this Note in whole or in part, at any time or from time to time, without penalty or premium, by paying to the registered holder all or part of the principal amount of this Note, together with the unpaid interest accrued on the amount of principal so prepaid to the date of such prepayment. Each prepayment shall be made on such date and in such principal amount as shall be specified by the City in a written notice delivered to the registered owner not less than two (2) days prior thereto. Notice having been given as aforesaid, the principal amount stated in such notice or the whole thereof, as the case may be, shall become due and payable on the prepayment date stated in such notice, together with interest accrued and unpaid to the prepayment date on the principal amount A-3 Res. No. 63-90 then being paid; and the amount of principal and interest then due and payable shall be paid (i) in case the entire unpaid balance of the principal of this Note is to be paid, upon presentation and sur- render of the Note to the office of the Paying Agent (principal cor- porate trust office, if the Paying Agent is not the City's Finance Department), and (ii) in case only part of the unpaid balance of principal of this Note is to be paid, upon presentation of such Note at the office of the Paying Agent (principal corporate trust office, if the Paying Agent is not the City's Finance Department) for nota- tion thereon of the amount of principal and interest on the Note then paid or for issuance of a replacement Note in the principal amount not redeemed. If, on the prepayment date, funds for the payment of the principal amount to be prepaid, together with interest to the prepayment date on such principal amount, shall have been given to the Paying Agent, as above provided, then from and after the prepay- ment date interest on such principal amount of this Note shall cease to accrue. If said funds shall not have been so paid on the prepay- ment date, the principal amount of the Note shall continue to bear interest u~-~l payment thereof at the rate or rates provided for herein. The Note shall ,~t be and shall not constitute an indebted- ness of the City within the meaning, of any constitutional, statutory, charter or other limitations of indebtedness but shall be payable solely from Pledged Revenues as provided in the Note Resolution. No Holder or Holders of the Note issued under the Note Resolution shall ever have the right to compel the exercise of ad valorem taxing power of the City, or taxation in any form of any real property therein to pay the Note or the interest thereon. The pledge of the Pledged Revenues shall not constitute a lien upon the Combined Public Utility or upon any other property whatsoever of the City. IN WITNESS WHEREOF, the City of Delray Beach, Florida, has caused this Note to be signed by its Mayor, either manually or with his facsimile signature, and the seal of the City Commission of the City of Delray Beach, Florida, to be affixed hereto or imprinted or reproduced hereon, and attested by the Clerk of the City, either man- ually or with her facsimile signature, and this Note to be dated the Dated Date set forth above. (SEAL) CITY OF DELRAY BEACH, FLORIDA ATTEST: By: Mayor Clerk of the City of Delray Beach, Florida A-4 Res. No. 63-90 FORM OF CERTIFICATE OF AUT}{ENTICATION Date of Authentication: This Note is the Note delivered pursuant to the within men- tioned Resolution. as Registrar By: Authorized Officer A-5 Res. No. 63-90 ASSIGNMENT FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto (please print or typewrite name, address and tax identification number of assignee) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints Attorney to transfer the within Note on the books kept for registra- tion thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: In the presence of: NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement, or any change whatever. A-6 Res. No. 63-90 DRAW-DOWN GRID [Outstanding Principal Amount not to Exceed $8,000,000] Principal Amount Initials Amount of Note of of Outstanding Noteholder Date Draw After Draw and City A-7 Res. No. 63-90 REPAYMENT GRID [Outstanding Principal Amount not to Exceed $8,000,000] Principal Amount of Note Initials Amount Outstanding of of after Noteholder Date Repayment Repayment and City A-8 Res. No. 63-90