The URL can be used to link to this page

Res 45-84 RESOLUTION NO. 45-84 ?. '~ A RESOLUTION AUTHORIZING THE ISSUANCE OF NOT EXCEEDING $28,000,000 WATER AND SEWER REVENUE BONDS OF THE CITY dP DELRAY BEACH, FLORIDA, FOR ~E PURPOSE OF REFUNDING CERTAIN OUTSTANDING OBLIGATIONS; TO FINANCE THE COST OF CONSTP4JC- TION OF ADDITIONS, EXTENSIONS AND IMPROVEMENTS ~) THE CITY' S COMBINED PUBLIC UTILITY; AND PROVIDING POR THE TERMS OF THE WATER AND S~ER REVENUE BONDS, AND THE RIGBTS, REME- DIES AND SECURITY dP THE HOLDERS OF THE WATER AND SEWER REVENUE BONDS. NC~, ~, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY dP DELRAY BEACH, PALM BEACH COUNTY, FLORIDA: KRTI CLE l DEFINITIONS, FINDINGS AND STATUTORY AUTBORI~T SECTION 1. DEFINITIONS. That, as use~ in the Resolution, the following terms shall have the following meanings unless the text otherwise expressly requires: A. ~"Accreted Value~" shall mean as of any aate of calcula- tion the amount owed on a Capital Appreciation Bona prior to maturity or at maturity taking into consiaeration the initial offering price plus accrued interest compounded semiannually on October 1 an~ April 1 of each year, with interest commencing the date of delivery o~ the Capital Appreciation Bonos, as shall be determineo by subse- quent proceedings of the City Council. B. ~Act," shall mean Chapter 166, Florida Statutes, as amen~eo ana supplementeo and other applicable provisions of law. C. ,"Annual Debt Service Requirements shall mean, at any time, the amount required to be OepositeO in the then current Fiscal Year into the Interest Account, Principal Account, ana Bond Redemption Account, as provioeo in the Resolution. 1 D. 'Bondholder' or 'Holder of Bonds' 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. -E. 'Bonds' shall mean the $28,000,000 Water and Sewer Revenue Bonds authorized to be issued pursuant to this Resolution, together with any ~ additional bonds hereafter issued in the manner hereinafter provided. F. "1961 Bonds' shall mean the outstanding Water and Sewer Revenue Bonds of the City of Delray Beach, dated December 1, 1961, originally issued in the amount of $500,000. G. '1962 Bonds' shall mean the outstanding Water and Sewer Revenue Bonds, Series 1962, of the City of Delray Beach, dated December 1, 1962, originally issued in the amount of $1,500,000. H. '1963 Bonds' shall mean the outstanding Water and Sewer Revenue Refunding Bonds, dated December 1, 1963, of the City of Delray Beach, originally issued in the amount of $1,550,000. I. "1965 Bonds' shall mean the outstanding Water and Sewer Revenue Bonds, Series 1965, of the City of Delray Beach, date~ June 1, 1965, originally issued in the amount of $2,000,000. J. "1972 Bonds' shall mean the outstanding Water and Sewer Revenue Bonds, Series 1972, of the City of Delray Beach, dated June 1, 1972, originally issued in the amount of $5,000,000. K.. "1979 Bonds". shall mean the outstanding Water and Sewer Revenue Bonds, Series 1979, of the City of Delray Beach, dated June 1, 1979, originally issued in the amount of $4,000,000. r~. "1983 Bonds' shall mean the outstanding Water and Sewer Bonds, Series 1983, of the City of Delray Beach, dated May 1, 1983, originally issued in the amount of $4,000,000. M. 'Capital Appreciation Bonds' shall mean the aggregate principal amount of the Bonds that bear interest ~ayable at maturity or upon redemption prior to maturity in the amounts determined by 2 Reso. No. 45-84 reference to the Accreted Value, all as shall be determined by subsequent proceedings of the City Council. N. "City" shall mean the City of Delray Beach, Florida. ~. "City Council" shall mean the governing body of the City. P. "Combined Public Utility" means the combined Water System and Sewer System of the City. Q. "Consulting Engineers" shall mean the firm of Russell & Axon of Daytona Beach, Florida, or such other qualified engineer or engineering firm at the time retained by the City to perform the acts and carry out the duties provided for such Consulting Engineers in this Resolution. R. "Escrow Deposit Agreement" shall mean the Escrow Deposit Agreement, entered into by and between the City and a bank or trust company or national banking association, as trustee, to be hereafter designated by subsequent proceedings of the City, in con- nection with the refunding of the Refunded Bonds. S. "Facilities" shall mean all the facilities of the Combined Public Utility, and all parts thereof, and any facilities which may hereafter be a part of the Combined Public Utility, or any part thereof, by any additions, betterments, extensions, improvements thereto, or property of any kind or nature, real or personal, tangi- ble or intangible, hereafter constructed or acquired. T. "Fiscal Year" shall mean that period commencing on October 1 and continuing to and including the next succeeding September 30, or such other annual period as may be prescribed by law. U. "Independent Insurance Consultant" shall mean a person or firm who is not an employee or officer of the City who is appointed by the City and is qualified to survey risks and to recommend insurance coverage for .organizations engaged in like operations, who has a favorable reputation for skill and experience 3 Reso. No. 45-84 in such surveys and recomendations, and who may be a broker or agent with whom th· '-City transacts business. V. 'Maximum Annual Debt Service Requlrement~l mean, at any t~me, the maximum amount required to be deposited in the then current or any succeeding Fiscal Year into the Interest Account, Principal Account and Bond Redemption Account, as provided in the Resolution. The amount of Term Bonds maturing in any Fiscal Year which are subject to mandatory redemption prior to their stated date of maturity by operation of the Bond Redemption Account shall not be included in determining the Maximum Annual Debt Service Requirement in their final Fiscal Year of maturity. W. "Net Revenues" shall mean the Gross Revenues remaining after deduction of Operating Expenses. X. "Operating Expenses" shall mean the current expenses of operation, maintenance and ordinary current repairs of the Combined Public Utility and its Facilities and shall include, without limiting the generality of the foregoing, insurance premiums, admin- istrative expenses of the City relating solely to the Combined Public Utility, and such other reasonable current expenses as shall be in accordance with generally accepted accounting principals. "Operating Expenses" shall not include any allowance for depreciation or any extraordinary items arising from the early extinguishment of debt. Y. "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 Article III, Section 4.R 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 4 Reso. No. 45-84 after purchase in the open market or because of payment at, or redemption 9riot to maturity~.and (v) Bonds held by the City. Z. "Paying Agent' shall mean the bank or trust company and any sdccessor bank or trust ~company appointed by the City to act as Paying Agent hereunder. AA. 'Permitted Investments" shall mean (i) to the extent permitted by law U.S. Obligations and (ii) all other investments per- mitted under the laws of Florida. BB. "Pledged Impact Charges" shall mean the charges that may be imposed by the City on new users connecting to the Combined Public Utility which would represent a ~/&~rata share of the costs of the Project which are attributable to the increased demand such addi- tional connections create upon the Combined Public Utility. Impact Charges, however, shall not include the installation charges imposed by the City for the cost of physically connecting into the City's Combined Public Utility (including but not limited to the cost of excavation, plumbing, installation of meters and landscaping). CC. "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, the construction of new water wells and an associated raw water main, the design and construction of an additional clarifier and aerator basin, sludge handling facilities and administration building and the expansion and improvement to the facility operated by the South Central Regional Wastewater Treatment and Disposal Board. DD. "Refunded Bonds" shall mean the outstanding water and sewer revenue bonds of the City which includes the 1961 Bonds, the 1962 Bonds, the 1963 Bonds, the 1965 Bonds, the 1972 Bonds, the 1979 Bonds and the 1983 Bonds. EE. "Registrar' shall mean the bank or trust company and any successor bank or trust company appointed by the City to act as Registrar hereunder. 5 Reso. No. 45-84 FF. 'Resolution" shall mean this Water and Sewer Revenue Bond Resolution as from time .to time amended and supplemented in accordance with the terms hereof. GG. "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 by the Resolution, which by the terms and provisions of the Resolution are required to be deposited in the Revenue Fund and the Interest Account, provided, however, that Revenues shall not include (1; Pleaged Impact Charges (2) Unpledged Impact Charges (3) special assessments and (4) capital contributions. HH. "Serial Bonds" shall mean the Bonds of an issue other than Term Bonds which shall be stated to mature annually. II. "Sewer System" shall mean the complete sanitary sewer collection and transmission facility and the Ocean Outfall System of the City and the City's one-half (1/2) undivided interest in the treatment and disposal system operated by the South Central Regional Wastewater Treatment and Disposal Board as they now exist and as may hereafter be improved and extended consisting of all real and per- sonal property of every nature owned by the City and used or useful in the operation thereof whether within or without the City. JJ. "Term Bonds" shall mean the Bonds of an issue which shall be stated to mature on one date and for the amortization of which mandatory payments are required to be made into the Bond Redemption Account in the Sinking Fund. KK. "Unpledged Impact Charges" shall mean the charges that may be imposed by the City on: new users connecting to the Combined Public Utility which would represent a ~ rata share of the 6 Reso. No. 45-84 costs of any .project other than the Project which are attributable to the increased demand such addi. tional connections created upon the Combined Public Utility. Unpledged Impact Charges, however, shall not include the installation charges imposed by the City for the cost of physically connecting into the City's Combined Public Utility (including but not limited to the cost of excavation, plumbing, installation of meters and landscaping). LL. ~U.S. Obligations~ shall mean the direct obligations of, or obligations the principal of and interest on which are uncon- ditionally guaranteed by, the United States of America. MM. 'Variable Rate Bonds~ shall mean Bonds issued with a variable, adjustable, convertible or other similar rate which is not fixed in percentage for the entire term thereof at the date of issue. NN. "Water System" shall mean the complete waterworks plant and system, within and without the City, now owned by the City, or hereafter constructed or acquired, including all improvements, extensions, and additions thereto hereafter constructed or acquired, together with all lands or interest therein, 91ants, buildings, machinery, franchises, pipes, fixtures, equipment and all property, real or personal, tangible or intangible, now or hereafter owned or used by the City in connection therewith. Words importing the singular number shall include the plural number in each case and vice versa, and words importing 9er- sons shall include firms and corporations. SECTION 2. FINDINGS. It is hereby ascertained, determined and declared: A. That the City of Delray Beach, Florida, now owns, operates and maintains a Combined Public Utility consisting of a municipal waterworks plant and syste~ ~or the supply and distribution of water and a sanitary sewer system for the collection and 7 Reso. No. 45-84 transmission of sewage and waste matters, within and without the City and it owns a one-half (1/2) qndivided interest in a treatment and disposal system operated by the South Central Regional Wastewater Treatment and Disposal Board. B. That it is deemed necessary and advisable and for the health and welfare of the inhabitants and citizens of the City and to meet the increased demand for new connections to the Combined Public Utility, to construct and acquire additions, extensions and improve- ments to the Combined Public Utility (the "Project"), at an estimated · cost of $14,000,000 to be financed from a portion of the proceeds derivea from the sale of the Bonds. C. That the City has heretofore issued and now has out- standing and unpaid the Refunded Bonds and there is hereby authorized the payment and refunding of the Refunded Bonds. D. That for the payment and refunding of the Refunded Bonds, the City shall deposit a portion of' the proceeds derived from the sale of the Bonds in an escrow deposit trust fund, which together with other available funds, if any, and the income and earnings derived from the investment thereof shall be sufficient to pay and refund the Refunded Bonds as the same become due and. payable or are redeemed prior to maturity in accordance with the proceedings which authorized their issuance, all as provided in a details resolution adopted by the City Council and the Escrow Deposit Agreement. E. That the estimated Revenues to be derived in each year hereafter from the operation of the Combined Public Utility will be sufficient at all times to pay all the costs of operation and mainte- nance of the Combined Public Utility, and together with the Pledged Impact Charges, the principal of and interest on the Bonds, as the same become due and payable, and all sinking fund, reserve and other paymmnts provided for in the Resolution. F. That the principal of and interest on the Bonds and all of the reserve, sinking fund and other payments provided for in .8 Reso. No. 45-84 the Resolution will be paid from the Net Revenues derived from the operation oZ the Combined Pu.blic Utility and the Pledged Impact Charges, all as provided herein; and the ad valorem taxing power of the City will never be necessary or authorized to pay the principal of and interest on the Bonds to be issued pursuant to the Resolution, or to make any of the reserve, sinking fund or other payments pro- vided for in the Resolution, and the Bonds issued 'pursuant to the Resolution shall not constitute a lien upon the Combined Public Utility or upon any other property whatsoever of or in the City but shall be payable from the Net Revenues derived from the operation of the Combined Public Utility and the Pledged Impact Charges, all in the manner as provided herein. G. The proceeds derived from the sale of the Bonds shall be used to finance the cost of paying and refunding the Refunded Bonds; to finance the cost of the Project all substantially in accor- dance with the plans and specifications prepared or to be prepared by the Consulting Engineers, now on file or to be filed with the City. Such cost shall be deemed to include, with respect to the Refunded Bonds, legal expenses, fees for financial services, the costs associ- ated with the purchase and subsequent management of the U.S. Obligations, expenses in connection with the performance of the duties of the trustee under the provisions of the Escrow Deposit Agreement and such other costs and expenses necessary and incidental to the refunding of the Refunded Bonds and with respect to the Project, the cost of the construction or acquisition of the addi- tions, extensions and improvements to the Combined Public Utility, including the acquisition of any lands or interest therein and of any fixtures or equipment or properties deemed necessary or convenient therefor, capitalization of all or part of the debt service reserve, engineering and legal expenses, interest on that portion of the Bonds used to finance the cost of such construction and acquisition prior to, during and for one (1) year after the completion of the Project, Reso. No. 45-84 fees for financial services, expenses for estimates of costs and of revenues, expenses for plans, s. pecifications and surveys, administra- 'tire expenses and such other expenses as may be necessary or inciden- tal to th~ financing authorized by this Resolution, and the construc- tion or acquisition of the additions, extensions and improvements to the Combined Public Utility authorized by this Resolution, and the placing of same in operation, and for the payment of any temporary obligations issued for the purposes provided in this Resolution. SECTION 3. AUTHORIT~ OF THIS RES(X/~ON. This Resolution is adopted pursuant to the provisions of Chapter 166, Florida Statutes, as amended and supplemented, and other applicable provisions of law. SECTION 4. RESOLUTION CONSTITUTES CONTRACT. In considera- tion of the acceptance of the Bonds, authorized to be issued hereun- der 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 agree- ments 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 pref- erence, priority, or distinction of any of the Bonds over any other thereof except as expressly provided therein and herein. 10 Reso. No. 45-84 AIIT~ORI ~,KTION, T~,~,S, REGISTRATION OF SECTION 1. A~THOItlZATION OF B~. Subjec~ and pursuant to the provisions of the Resolution, Bonds of the City of Del=ay Beach, Flor. ida, are hereby authorized to be issued in accordance with the terms of this Resolution. SECTION 2. DESCRIPTION OF B~)S. There is hereby authorized an original issue of Bonds to be issued pursuant to the Resolution in the aggregate principal amount of not exceeding TWENTY EIGHT MILLION DOLLARS ($28,000,000) for the purposes provided in Article I, Section 2 .G. of this Resolution. The Bonds shall be issued in regis- tered form, shall be in the denomination of $5,000 each, or any inte- gral multiple thereof, provided, however, if such Bonds are Capital Appreciation Bonds then in $5,000 maturity amounts or in $5,000 multiples thereof and shall be numbered separately from one upward. The Bonds shall be designated City of Del=ay Beach, Florida, Water and Sewer Revenue Bonds, Series 1984, shall bear interest at not exceeding ~he 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 registry books of the City maintained by the Registrar at the close of business on the fifteenth day of the calendar month preced- ing each interest payment date or on the date the principal sum of any Bond is paid; ~, howler, that if and to the extent there is a default in the ~ayment of the interest due on such interest pay- ment date, such defaulted interest shall be paid to the Persons in whose name Bonds are registered on the registry 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 owne~, not less than the tenth day preceding such subsequent interest payment date, such 11 Reso. No. 45-84 inte'rest shall~ be payable semiannually on April 1 and October 1 of each year, except that interest on any Capital Appreciation Bonds shall be paid only at maturity or upon redenption prior to maturity in the amount determined by reference to the Accreted Value, shall mature within forty (40). years from their date of issuance, shall be dated, principal payable at the principal corporate trust office of the Paying Agent located within or without the State of Florida, shall mature in such years and amounts, all as shall be determined by subsequent proceedings of the City Council. If the City receives an opinion of counsel of recognized standing in the field of law relating to municipal bonds to the effect that t~he issuance of any of the Bonds in coupon form will not adversely affect the exemption from Federal income taxation of the interest on any of the Bonds and the City a~opts a supplenental reso- lution authorizing coupon Bonds, the Registrar shall mail notice to the registered owners of the Bonds of the availability of interchang- ing registered Bonds for coupon Bonds. Registered Bonds may then be exchanged for an equal aggregate principal amount of coupon Bonds of the same series and maturity of any authorized denomination and thereafter, coupon Bonds may be exchanged for an equal aggregate principal in the manner provided in such supplemental resolution. SECTION 3. REDEHPTION PROVISIONS. The Bonds may be subjec~ to redemption prior to maturity at such times, at such redemption prices and upon such terms as shall be determined by subsequent pro- ceedings of the City Council. SECTION 4. EXECUTION OF BOI~S.' The Bonds shall be executed in the name of the City by the signature of the Mayor and its offi- cial seal shall be affixed thereto or imprinted or reproduced thereon and attested by the City Clerk. The signatures of said Mayor and Clerk on the Bonds may be manual or facsimile signatures. In case any one or more of the officers who ~hall have signed or sealed any of the Bonds shall cease to be such officer of the City before the 12 Reso. No. 45-84 Bonds so signed and sealed shall have been actually sold and delivered, such Bonds may n~vertheless 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 Bond may be signed and sealed on behalf of t, he City by such person who at the actual time of the execution of such Bond shall hold the proper office, although at the date such Bonds shall be actually delivered such person may not have held such. office or may not have been so authorized. The Bonds shall bear thereon a certificate of authentica- tion, in the form set forth in Section ? of this Article, 'executed manually by ~he Registrar. Only such Bonds as shall bear thereon such certificate of authentication shall be entitled to any right or benefit under this Resolution and no Bond shall be valid or obliga- tory for any purpose until such certificate of 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 con- clusive evidence that the Bond so authenticated has been duly authen- ticated and delivered under this Resolution and that the Holder thereof is entitled to the benefits of this Resolution. The validation certificate on the Bonds shall be signed with the facsimile signatures of the present or any future Mayor and Clerk, as aforesaid, and the City may adopt and use for that purpose the facsimile signature of any person who shall have been such Mayor and Clerk at any time on or after the date of the Bonds, notwith- standing that he may have oeased to be such Mayor or Clerk at the time when said Bonds shall be actually delivered. SECTION 5. liEGOTIABZLITY, I~GL~TP~TION ~ CAN~r.r~. At the option of the registered Bolder thereof and upon surrender thereof at the principal corporate trust office of the Registrar with a written instrument of transfer satisfactory to the Registrar duly executed by the registered Holder or his duly authorized attorney and 13 Reso. No. 45-84 upon payment by such Holder of any charges which the Registrar may make as provided in this Section, the Bonds may be exchanged for Bonds of_the same series and maturity of any other authorized denomina t i OhS. 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 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 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 Paying Agent and the Registrar may 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 receiv- ing payment of, or on account of, the principal of and interest on such Bond as the same become due and for all other purposes. Ail 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 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 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. Ail Bonds surrendered in any such exchanges or transfers shall forthwith be delivered to the P~gistrar 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 14 Reso. No. 45-84 sum sufficient to pay any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer. Neither t_he City nor the Registrar shall be required (a) to transfer or exchange Bonds for a period of 15 days nex~ preceding an interest payment date on such Bonds 'or 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 Ten~ Bond is redeemed or clef eased, the City shall execute and the Registrar shall authenticate and deliver, upon the surrender of such Term Bond, without charge to the Bondholder, for the unpaid balance of the principal amount of such Term Bond so surrendered, a registered Term Bond in the appro- priate denomination. Ail 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 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 cer- tificate of destruction in duplicate by the signature of one of its authorized officers describing the Bonds so destroyed, and one exe- cuted certificate shall be filed with the City and the other executed certificate shall be retained by the Registrar. SECTION 6. BONDS ~IUTILATED, D~-STRO]~ED, 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 15 Reso. No. 45-84 to them. In the event any such Bond shall be about to mature or have matured or have been called ~or redemption, instead of i.ssuing 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 5 of this Article. 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 from the Net Revenues derived from the operation of the Combined Public Utility and the Pledged Impact Charges pledged hereunder, with all Other Bonds issued hereunder. SECTION 7. FOl~q OF B(~S. The text of the Bonds shall be of substantially the following tenor, with such omissions, insertions and variations as may be necessary and desirable: 16 Reso. No. 45-84 (Form of Bond)* * The text of the Bonds shall be of substantially the tenor set forth below. Provisions of the Bonds may be set forth on the back of the Bonds and shall for all purposes have the same effect as if set forth on the front of the Bonds. No. R $5,000 UNITED STATES OF AMERICA STATE OF FLORIDA PALM BEACH COUNTY CITY OF DELRAY BEACH BOND, SERIES Date of Interest Maturity Original Rate Date Issue CUSIP KNOW ALL MEN BY THESE PRESENTS, that the City of Delray Beach, Palm Beach County, Florida, for value received, hereby prom- ises to pay, from the Net Revenues (as defined in the Resolution hereinafter referred to) derived from the operation of its Combined Public Utility (consisting of the combined Water and Sewer Systems) and Pledged Impact Charges, hereinafter mentioned, to or registered assigns on the date specified above, upon the presenta- tion and surrender hereof at the principal corporate trust office of , as paying agent (said and any bank or trust company become successor paying agent being herein called the "Paying Agent ") , the principal ~um of DOLLARS ($ ), with interest thereon, from the date hereof, at the 17 Reso. No. 45-84 rate of ] .~er centum (__.%) per annum, payable _, 19__ and semi~annually thereafter and until the_ City's obligation with respect to the payment of such prin- cipal sum shall be discharged~ provided, however, t_hat interest shall be paid by check or draft made payable to the registered owner and mailed to the address of the registered owner as such name and address shall appear on the registry books of the City initially maintained by , as Registrar (said and any bank or trust company become successor Registrar being herein called the 'Registrar") at the close of business on the fifteenth ~ay of the calendar month preceding each interest payment date or on the date the principal sum of this bond is paid~ ~~l~, ~, that if and to the extent there is a default in the payment of the inter- est due on such interest payment date, such defaulted interest shall be paid to the persons in whose name Bon~s are registered on the reg- istry 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. This bond is one of an authorized issue of Bonds in the aggregate principal amount of not exceeding $ of like date, tenor, and effect, except as to number, date of maturity and interest rate, issued for the purpose of paying the cost of refunding the Refunded Bonds (as defined in the Resolution hereinafter referred to), to provide funds to finance the construction and acquisition of additions, extensions and improvaments to the Combined Public Utility under the authority of and in full compliance with the Constitution and Statutes of the State of Florida, including particularly Chapter 166, Florida Statutes, as ~ended and supplemented and other applicable provisions of law, and a '~esolution duly adopted by the City Council oh , 1984, as amended (herein referred to 18 Reso. No. 45-84 as the "Resolution"), and is subject to all the terms and conditions of the Resolution: ' This bond is payable from and secured by a lien upon and pledge of the Net Revenues derived from the operation of the City's Combined Publi6 Utility and the Pledged Impact Charges, as defined in the Resolution, all in the manner provided in the Resolution. The full faith and credit of the City is not pledged for the ~ayment of this bond and this bond does not constitute an indebtedness of the City within the meaning of any Constitutional, statutory or other provision or limitation; and it is expressly agreed by the Holder of this bond that such Holder shall never have the right to require or compel the exercise of the ad valorem taxing power of the City for the payment of the principal of and interest on this bond or the making of any sinking fund or reserve payments provided for in the Resolution. It is further agreed between the City and the Holder of this bond that this bond and the obligation evidenced thereby shall not constitute a lien upon the City's Combined Public Utility, or any part thereof, or on any other property of or in the City, but shall constitute a lien only on the Net Revenues derived from the operation of the City's Combined Public Utility and the Pledged Impact Charges, all in the manner provided in the Resolution. The City has covenanted in the Resolution that in each Fiscal Year it will fix, establish and maintain such rates and col- lect such fees, rentals or other charges for the services and facili- ties of its Combined Public Utility and revise the same from time to time whenever necessary, as will always provide in each Fiscal Year, Net Revenues which together with the Pledged Impac~ Charges received in such Fiscal Year, shall be adequate to pay at least one hundred and twenty-five percent (125%) of the Annual Debt Service Requirement (as defined in the Resolution) for the Bonds and any pari passu additional Bonds hereafter issued, provided that Net Revenues 19 Reso. No. 45-84 least One ~Und~ed Pe~cen~ ~a be ad~e ~o ~mPace Cha~gea ahab1 be sufficient eo With ~e Pledged he~ea~ ~enta~a or O~er Rea°~ut~°n and that C~ene ~or Such charges aha~ not ~ Such reduced ac aa eo be ~he Original ~e · te~ed OWne~ o~ and c°naen~ed ~ tb~a bond aha~d °~ne~, and e- - the teg~a:_ . ~'ne Reg~atra. ~ ~e~a and - ~ ~e~ to hav- aonda _ ~at~On o~ a---- ~ aha~ m~,,~. ~°ndZt~ona: e agreed _ ~ ~e ~eg~ste._- zn ~e ~so~u~_ ~e reg~stta,~ s of ~e Qt~ ' "egzatrar and ~ on~ UPon .. ~:aon ct b~ ~. ~ . ~g~ ate~e~ ~t~efaCto~_ -ertl tOge ~eree a ae uoad, the -. u~°rized a~ ~Y executed ~ Bonds. ~44 ~Ue 4n .: ~' DPon the ~e n~e o~ ~e (2) and treat t= ~'ne City, the - the ~ ~e Perso~ . ~aY~na a_ - ~o~s kept _ "~n ~bo~ n~ ~ ~ent ~d ~_ Whet~er au-: oy ~e Reg~ ~e any ~nd ~ _ e Registrar ~._ ~ng Pa~.- ~ ~nd shal~ k_ crar aa ~he ~_ ~a~ ~ ~eg~s "~Y de~ ~Ucfl bo~~eat of, or on -~ Overdue or n_. ~°lUte OWner _~ feted u~n aha-- Ymenta So ma~ eComea due, _ ~rinc~l of .__ · of rector. '~ be Vall~ ue to ~y ~.. ~nd ~oc a~ ~d ~nterest the ~. CO ~ o aa~ - nec O- - a- ~'zty, the ~_ -,,e e~ent of - -~azy ~d ~a-' ' U~n his or~ "Y notice t* __~Ying agent, _ ~e a~ or e.-- ~ar~ ~e ~ .~ .~er ~ the Con-- ~ot the ~_ . ~ ~ ~i~ 2O Reso. No. 45,84 (3) 'At the option of t. he registered owner thereof and upon surrender hereof at the principal 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 autho- rized 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 gov- ernmental 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 of 15 days next preceding an interest payment date on such Bonds or next preceding any selec- tion 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 appro- priate denomination. 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 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 issue of 21 Reso. No. 45-84 Bonds of which this bond is one, is in full compliance with all constitutional or statutory l~mitations or provisions& _IN WITNESS WHEREOF the City of Delray Beach· Florida· has issued this bond and has caused the same to be executed by the manual or facsimile signature of its Mayor and the corporate seal of the City to be affixed hereto or lithographed or imprinted or reproduced hereon· and attested by the manual or facsimile signature of the City Clerk of the City, all as of the day of , . CITY OF DELRAY BEACH, FLORIDA By Mayor (SEAL) Attest: City Clerk (FORM OF CERTIFICATE OF AUTHENTICATION) Date of Authentication: This bond is one of the Bonds delivered pursuant to the within mentioned Resolution. · as Registrar Authorized Officer 22 Reso. No. 45-84 (FORM OF VALIDATION CERTIFICATE) This bond is one of ~ series of Bonds which were validated by judgment of the Circuit Court of Palm Beach County, Florida, rendered on the day of , 198_. Mayor City Clerk 23 Reso. No. 45-84 ASSIGNMENT AND TRANSFER FOR VALUE RECEIVE~ 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 registra- tion thereof, with full power of substitution in the premises. Dated: In the presence of: 24 Reso. No. 45-84 - ~TI C~ III COV~t~,I~S, PUl~S ~ APPLICATION TltgIIlDP SE~ION 1. ~S ~ ~ ~ I~EBTEDNESS OF THE CI~. The Bonds shall not be and shall not constitute an indebte~ess of ~e City within the meaning of any constitutional, statutory or other limitation of indeb=e~ess, but ~all ~ ~y~le ~lely from ~e Net Revenues derived from the operation of ~e Co~ined Public Utility, and ~he Pledged Impac2 Charges, as herein provided. No Holder or Holders of any Bonds issued here~der shall ever have ~e right to cornel the exercise of the ad valor~ taxing ~wer of ~e City, taxation in any fo~ of any re~ p=o~r~ ~erein to pay ~e ~n~ the interest thereon. SECTION 2. BO~S SECU~ BY PL~GE OF ~T ~UES P~~ IMPA~ ~GES. ~e paint of ~e princi9~ of ~d interest on all of the Bonds issued here~der shall be secured fo=thwith ~ually ~d rashly by a first lien on ~d pledge of ~e Net Revenues derived from ~e o~ra2ion of ~e Co~ined Public Utility ~d a firs2 lien on and 91edge of the Pledged Im~ct ~arges. The Net R~enues derived from the operation of the Combined Public U~ility ~d the Pledged Impact Charges in an ~ount sufficient to pay ~e principal of ~d interest on the Bonds herein authorized ~d to ~ke ~e ~y- ments into the reserve and sinking f~d ~d all o~er pa~ents vided for in the Resolution, are hereby irrevocably pl~ged payment of the principal of and interest on the Bonds authorized herein, and other ~yments provided for he=ein, as ~e ~e ~me due and payable. SECTION 3. ~PLI~TION OF BO~ PROCEEDS. Ail moneys =eceived by ~e City from ~e s~e of ~e ~n~ originally au~orized and issued pursuan~ to the Resolution ~1 ~ disbur~d as foll~s: 25 Reso. No. 45-84 A. The accrued interest derived from the sale of the Bonds shall be deposited in th~ Interest Account, hereinafter created and established, and used for 'the purpose of paying interest on t_he Bonds as the same becomes due and payable. B. From the proceeds of the Bonds an 'amount which together with any other moneys lawfully available therefor, including m~neys and investments transferred pursuant to paragraph R of Section 4 of this Article III, shall be deposited in escrow deposit trust funds to be held by a bank or trust company, as trustee, under the terms and provisions of the Escrow Deposit Agreement and such proceeds shall be held irrevocably in trust in the escrow deposit trust funds under the terms and provisions of the Escrow Deposit Agreement; such moneys shall be invested at the time of deposit in U.S. Obligations, the principal a~d interest of which shall be suffi- cient to pay the principal of and interest on the Refunded Bonds as the same mature and become due and payable or are redeemed prior to maturity, as provided in the Escrow Deposit Agreement. C. From the proceeds of the Bonds there may be deposited in the Debt Service Reserve Account such amount as shall be deter- mined by subsequent proceedings of the City Council. D. The balance of the proceeds derived from the sale of the Bonds shall be deposited into a "Construction Fund" which is hereby created and established. No withdrawals shall be made from the Construction Fund (except for the payment of interest on the Bonds prior to, during and for one (1) year after the completion of the Project in such amounts as the City Council shall hereafter determine by subsequent proceedings, legal, financial and engineering expenses and fees, and expenses and fees in connection with ~he issu- ance of the Bonds) without the written approval of the Consulting Engineer and only u~on recei~c of a written requisition executed by a : duly authorized official of the City, specifying the purpose for which such withdrawal is to be made and certifying that such purpose 26 Reso. No. 45-84 is one of the 'purposes provided for in the Resolution. If for any reason the moneys in said Construction Fund, or any part'thereof, are not necessary for, or are not applied to the purposes provided in the. Resolution, then such unapplied proceeds, upon certification of the Consulting Engineer that such surplus proceeds are not needed for the purposes of the Construction Fund, shall be deposited in the follow- ing manner and order of priority: First to the Debt Service Reserve Account in the Sinking Fund, hereinafter created and established, to the full extent neces- sary to make the amount then on deposit therein equal to Maximum Annual Debt Service Requirement, and Second, the balance, if any, to the Renewal, Replacement and Improvement Fund, hereinafter created and established. The moneys deposited in the Construction Fund may, pending their use for the purposes provided in the Resolution, be temporarily invested in Permitted Investments maturing not later than the dates on which such moneys will be needed for the purposes of the Construction Fund. All the earnings from such investments shall remain in and become a part of said Construction Fund and be used for the purposes of the Construction Fund. The proceeds of the sale of the Bonds shall be and consti- tute 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 4. COVENANTS OF THE CITX. So 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, Principal Account, Bond Redemption Account and the Debt Service Reserve Account, herein cre- ated 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 27 Reso. No. 45-84 Section 4.R~ of this Article III have been complied with, t_he City covenants with ~he Holders of 'any and all of the Bon~s issued pursu- ant to t_h_e** Resolution *as follows.' A. ARBITRAGE COVENANT. The City agrees that it will not direct the investment of the proceeds of the Bonds or any other funds in a manner which would cause the Bonds to be "arbitrage ~onc~" as defined in Section 103(c) of the Internal Revenue Code of 1954, as amended, or the regulations thereunder, proposed or in effect as of the date of issuance of the Bonds. B. P~TES. The City in each Fiscal Year, will fix, estab- lish and maintain such rates and collect such fees, rentals or other charges for the services and Facilities of its Combined Public Utility, and revise the same from time to time whenever necessary, as will always provide in each Fiscal Year Net Revenues, which together with the Pledged Impact Charges received .in such Fiscal Year, shall be adequate to pay at least one hundred and twenty-five percent (125%) of the Annual Debt Service Requir~ent for the Bonds and any pari passu additional Bonds hereafter issued, provided that Net Revenues receive in such Fiscal Year shall at all times be adequate to pay at least one hundred percent (100%) of the Annual Debt Service Requirement for t_he Bonds and any pari passu additional Bonds hereaf- ter issued; and that such Net Revenues together with the Pledged Impact Charges shall be sufficient to make all of the payments required by the terms of the Resolution and that such rates, fees, rentals or other charges shall not be so reduced so as to be insuffi- cient for such purposes. C. COMBINED PUBLIC UTILITY REVENUE FUND. The Revenues derived from the operation of the Combined Public Utility shall be deposited in a fund in a bank or trust company in the State of Florida which is eligible under state laws to receive deposits of city funds, which fund is hereby created, established and designated as the "Combined Public Utility Revenue Fund" (hereinafter referred 28 Reso. No. 45-84 to as the 'Revenue Fund'). Said Revenue Fund shall constitute a trust fund for the purposes p~ovided in the Resolution, and shall be kept separate and distinct from all other funds of the City and used only for the purposes and in the manner provided for in Section 4.D. of this Article III. D. CREATION AND ESTABLISHMENT OF VARIOUS FUNDS AND ACCOUNTS AND THE DISPOSITION OF REVENUES. There are hereby cre- ated and established the following funds and accounts: The 'Water and Sewer System Operation and Maintenance Fund' (hereinafter referred to as the 'Operation and Maintenance Fund"). The 'Water and Sewer System Sinking Fund' (hereinafter referred to as the 'Sinking Fund'). There are also hereby created and established four (4) separate accounts in the Sinking Fund to be known as the 'Interest Account', the "Principal Account", the "Bond Redemption Account' and the 'Debt Service Reserve Account'. The 'Water and Sewer System Renewal, Replacement and Improvement Fund' (hereinafter referred to as the 'Renewal, Replacement and Improvement Fund'). The 'Water and Sewer System Pledged Impact Charge Fund" (hereinafter referred to as 'Pledged Impact Charge Fund"). Revenues: The Revenues at any time on deposit in the Revenue Fund shall be disposed of only in the following manner: 1. Revenues shall first be used, to the full extent neces- sary, for deposit into the Operation and Maintenance Fund in an amount equal to the Operating Expenses to be paid during the current calendar month. 2. Revenues shall next be used, to the full extent neces- sary, for deposit into the Interest Account in the Sinking Fund, on the fifteenth (15th) day of each month, beginning with the fifteenth (15th) day of the first full calendar month following the date on which any or all of the Bonds are delivered to the purchaser thereof, 29 Reso. No. 45-84 such sums as Shall be sufficient to pay one-sixth (1/6th) of the interest becoming due on the ~onds on the next semi-annual interest payment date, provided, however, that such monthly 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 and, provided further, that in the event the City has issued pari passu additional Variable Rate Bonds pursuant to the provisions of this Resolution, Revenues shall be deposited at such other or additional times and amounts as necessary to pay the interest becom- ing due on the Bonds on the next interest payment date, all in the manner provided in the supplemental resolution authorizing such pari passu additional Variable Rate Bonds. The earnings and investment income derived from the moneys and investments on deposit in the Principal Account, the Bond Redemption Account and the Debt Service Reserve Account which are to be deposited in the Interest Account as required by the terms of the Resolution, shall be credited against the amount of Revenues required to be deposited in the Interest Account. In the event that the period to elapse between the date of the delivery of the Bonds and the next semi-annual interest payment date will be less or more than six (6) months, then such monthly pay- ments shall be increased or decreased accordingly in sufficient amounts to provide the required semi-annual interest amount maturing on the next interest payment date. 3. Revenues shall next be used, to the full extent neces- sary, (a) for deposit in the Principal Account in the Sinking Fund, on the fifteenth (15th) day of each month in each year, one twelfth (1/12th) of the prin- cipal amount or Accreted Value of the Serial Bonds which will mature and become due on the next annual maturity date, as shall be determined by subsequent 3O Reso. No. 45-84 proceedings of the City Council. In the event the period to elapse between the date of delivery of the Bonds and the next principal payment date will be less or more than twelve (12) months, then such monthly payments shall be increased or decreased accordingly in sufficient amounts to provide the required princi- pal amount maturing on the next principal payment date. (b) for deposit into the Bond Redemption Account in the Sinking Fund, on the fifteenth (15th) day of each month in each year, one twelfth (1/12th) of the amount required for the payment of the Term Bonds, as shall hereafter be determined by subsequent proceedings of the City Council, until the amount on deposit therein is equal to the amount required to be paid on the next installment payment date. The moneys in the Bond Redemption Account shall be used solely for the purchase or redemption of the Term Bonds payable therefrom. The City may purchase any of the Term Bonds at prices not greater than par and accrued interest and may purchase Capital Appreciation Bonds (if such Capital Appreciation Bond is a Term Bond) at prices not greater than the Accreted Value as of the date of purchase. If, by the application of moneys in the Bond Redemption Account, the City shall purchase or call for redemption in any year Term Bonds in excess of the installment require- ment for such year, such excess of Term Bonds so pur- chased or redeemed shall at the option of the City either be credited on a pro rata basis over the remaining installment payment dates or credited against the following year's installment requirement. 31 Reso. No. 45-84 The City shall, to the extent of any moneys in the Bond Redemption A. ccount, be mandatorily obligated to use such moneys for the redemption prior to matu- rity of Term Bonds in such manner and at such times as shall hereafter be determined by subsequent proceed- ings of the City Council. No distinction or preference shall exist in the use of moneys on deposit in the Revenue Fund fo= pay- ment into the Interest Account, the Principal Account and the Bond Redemption Account in the Sinking Fund, su=h accounts being on a parity with each other. 4. Revenues shall next be used, to the full extent neces- sary, for deposits into the Debt Service Reserve Account in the Sinking Fund, on the fifteenth (15th) day of each month in each year, beginning with the fifteenth (15th) day of the fi=st full calendar month following the date on which any or all of the Bonds issued hereunder are delivered to the purchaser thereof, such sums as shall be sufficient to pay an amount equal to one-twelfth of twenty ~ercent (1/12th of 20%) of the Maximum' Annual Debt Service Requirement; pro- vided, however, that if Bond proceeds are deposited in the Debt Service Reserve Account in an amount less than the Maximum Annual Debt Service Requirement, the City shall (except as hereafter pro- vided in the following paragraph) cause Revenues to be deposited in an amount equal to one-sixtieth (1/60th) of the difference between the amount on deposit in the Debt Service Reserve Account and the Maximum Annual Debt Service Requirement, and provided further, that no payments shall be required to be made into the Debt Service Reserve Account whenever and as long as the amount deposited therein shall be equal to the Maximum Annual Debt Service Requirement. In the event the City shall hereafter issue Variable Rate Bonds, the maximum amount required to be deposited in the Interest Account for the payment of interest on such Variable Rate Bonds and/ 32 Reso. No. 45-84 or for the purpose of determining the amount required to be on deposit in the Debt Service Re. serve Account, shall be calculate~ as of the first day of each Fiscal Year 'and shall be based' upon one hun- dred ten ~er centum (110%) of the greater of (i) the average daily interest rate on such Variable Rate Bonds during the preceding Fiscal Year, or (ii) the actual rate of interest applicable to such Variable Rate Bonds on the date of calculation. Notwithstanding the foregoing provisions, in lieu of the deposits of Revenues into the Debt Service Reserve Account, the City may cause to be deposited into the Debt Service Reserve Account a surety bond, unconditional direct pay letter of credit issued by a bank or a municipal bond insurance policy issued by a reputable and recognized municipal bond insurer for the benefit of the Bondholders in an amount equal to the difference between the Maximum Annual Debt Service Requirement and the sums then on deposit in the Debt Service Reserve Account, which surety bond, letter or credit, or insurance policy shall be payable (upon the giving of notice as required thereunder) on any interest or principal payment date on which a deficiency exists which cannot be cured by funds in any other account held pursuant to this Resolution and available for such purpose under the terms and order of priority as established by this Resolution. Such municipal bond insurer or bank in the case of a letter of credit shall be one whose municipal bond insurance policies or unconditional direct pay letters of credit insuring or guaranteeing the payment, when due, of the principal of and interest on municipal bond issues results in such issues being rated in the highest rating category by either Standard & Poor's Corporati. on or Moody's Investors Service, or their successors. If a disbursement is made from a surety bond, letter of credit or an insurance policy provided pursuant to this paragraph, the City shall be obligated to reinstate the maximum limits of such a surety bond, letter :of credit or insurance Policy immediately following such disbursement or t8 replace .such surety 33 Reso. No. 45-84 bond, letter-of credit or insurance policy by depositing into the Debt Service Reserve Account f. rom the Revenues and Pledged Impact Charges, as herein provided, funds in the maximum amount originally payable under such policy or letter of credit, or a combination of such alternatives. Whenever, there is on deposit in the Debt Service Reserve Account an amount in excess of the Maximum Annual Debt Service Requirement, the amount of such excess shall be reduced at the option of the City in the following manner: (a) if there is on deposit in the Debt Service Reserve Fund a surety bond, letter of credit or an insurance policy as provided herein, the principal amount thereof shall be reduced by the amount of such excess and (b) by reducing the amount of moneys and/or securities in the .Debt Service Reserve Account in an amount equal to such excess. The moneys and/or securi- ties so withdrawn under subsection (b) above shall be deposited in the Renewal, Replacement and Improvement Fund and used for the pur- poses provided therein; provided, however, that all of the income and expenses incurred from the investment and reinvestment of moneys on deposit in the Debt Service Reserve Account shall be deposited in the Interest Account as herein provided in this Resolution. Moneys in the Debt Service Reserve Account shall be used only for the purpose of making payments into the Interest Account, the Principal Account and the Bond Redemption Account when the moneys in the Revenue Fund are insufficient therefor. In the event that any moneys shall be withdrawn from the Debt Service Reserve Account for payments into the Interest Account, the Principal Account and the Bond Redemption Account such withdraw- als shall be subsequently restored from the first Revenues available after all required payments have been made into the Interest Account, the Principal Account and the Bond Redemption Account including any deficiencies for prior payments to the extent such deficiencies are 34 Reso. No. 45-84 not paid from moneys on deposit in the Pledged Impact Charge Fund as hereinafter provided. . No distinction or preference shall exist in the use of the moneys on =deposit in the Debt Service Reserve Account for payment into the Interest Account, the Principal Account and the Bond Redemption Account, such accounts being on a .parity with each other. 5. Revenues shall next be used, to the full ex=ent neces- sary, for deposits into the Renewal, Replacement and Improvement Fund on the fifteenth (15th) day of Bach month, beginning with the fif- teenth (15th) day of the first full calendar month following the date on which any or all of the Bonds issued hereunder are delivered to the purchaser thereof, in such sums as shall be sufficient to pay one-twelfth (1/12th) of five per centum (5%) of the Gross Revenues derived from the operation of the Combined Public Utility during the preceding Fiscal Year. No further deposits need be made if the Consulting Engineer shall certify that no additional deposits are necessary for the purposes of the Renewal, Replacement and Improvement Fund. The moneys in the Renewal, Replacement and Improvement Fund shall be used for the purpose of paying the costs of extensions, improvements or additions to, or the replacement or renewal of capi- tal assets of the Combined Public Utility, or extraordinary repairs of the Combined Public Utility~ provided, however, that moneys in the Renewal, Replacement and Improvement Fund shall be used for payment into the Interest Account, the Principal Account and the Bond Redemption Account when the moneys in the Revenue Fund, the Debt Service Reserve Account and the Pledged Impact Charge Fund are insuf- ficient therefor. 6. Revenues shall next be used for the payment of any sub- ordinated indebtedness hereafter issued by the City in connection with the Combined Public Utility in accordance with the proceedings authorizing such subordinated indebtedness. 35 Reso. No. 45-84 7. ~.Thereafter, the balance of any Revenues renaining in the Revenue Fun(~ shall be used b~ the City to make 4mprovements to the Combinea Publ:Lc Utility, to purchase or reGeem Bonds prior to maturity or for any other law£ul purpose, provided, however, that none of such Revenues shall ever be useG for the purposes provided in this paragraph (7) unless all payments require~ in pa£agraphs (1) to (6) above, incluaing any aeficiencies for prior payments, have been maae in full to the date of such use, provided, further, however, that the moneys in the Renewal, Replacement aha Improvement Fund " shall be used for payment into the Interest Account, the Principal Account ana the Bona ReOemption Account when the moneys in the Revenue Funa aha the Debt Service Reserve Account and the Pledged Impact Charge Fund are insufficient therefore. Pledged Impact Charges= There shall be aeposited in the Pledged Impact Charge Fund all PleOgea Impact Charges as received by the City ana such Pledged Impact Charges shall be used by the City to the extent permitted by law in the following manner and oraer of priority= (a) For the payment into the Interest Account, the Principal Account aha the Bona ReO~nption Account when the moneys, in the Revenue Fund and the Debt Service Reserve Account are insufficient therefor. (b) To restore any withdrawals or to make up any deficiencies that may exist from t/me to t/me in the Debt Service Reserve Account whenever the moneys in the Revenue Fund are insufficient for such purpose. (c) To pay the cost of capital improvements to the Combinea Public Utility. (d) The balance of any Pleoged Impact Charges remaining in the Pledgea I~pact Charge Funa shall be deposited in the Interest Account and used to pay 36 Reso, No. 45-84 in,eXeRt becking sue on the Bon~! provi~ea, ho~ver, 8(a) through 8(c), tncluain9 any Oe~iciencies ior prior ~yments are maoe in tull to Oa~ st apch ~. 8. ~he Opera~ion ano aaintenance FunQ, the Si~g incluaing the ln~erest Account, Princi~l Account, ao~ ~~ion Account an~ ~e~C Service Reserve Account therein, ~e aen~a~, Replacement ~ lmprov~t ~ ~e Pl~ ~ct ~ ~ ~e Construction Funs ano ~ other s~i~ ~ ~n ac~ta ated eno established ~ ~e bsolutton ~1 ~nstitute trot ~. ~he ~ounts r~uireQ to be accountea ~or in each of ~e ~unda accounts aesignated herein, except ~o~ the Sinking Funo, may be ae~siteQ in a single ~an~ account nain~aineO b~ the City tha~ an~uate accountin9 pzoceoucea are maintained to re~lect and control ~e restricteQ a~lo~tions o~ ~e ~ounts on ~e~sit ~ere~ ~or the various purposes o~ such ~unos ano accounts as herein proviOea. ~he Qesig~tion ~a es~blis~ent of f~ ~o accosts Rna ~ ~e Resolution shall not be construed to r~uire ~e esta~ lis~en~ o~ an~ completely inGe~n~nt i~ ~Q accosts but ra~er ia intenae~ solely to constitute an allocation o~ certain aha assets o~ ~e C~ineQ P~lic Ot~ity ~or certa~ pur~ses establish such ~c~in priorities rot app~i~tion o~ ~r~in r~enues aha assets as herein pcoviaea. aoneys on deposit in the Revenue Fund, Operation ano aaintenance Funn aha the Renewal, Replacement ano Xnpr~nt nay be investeo in Permitted Xnves~ents Mturin9 no~ la~r ~ ~e Qatar on which such moneys vii1 ~ neeQeO ~or ~e pur~s o~ such ~ uno sc account. 37 Reso. No. 45-84 Moneys on deposit in the Debt Service Reserve Account, Interest AcCount, Principal Ascount, Bond Redemption Account and Pledged Impact Charge Fund may be invested in U.S. Ob~igatlons or any other Termitted 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. Ail income and earnings received from the investment and reinvestment of moneys on deposit in the Operation and Maintenance Fund and the Renewal, Replacement and Improvement Fund shall be transferred to the Revenue Fund and used in the same manner as other moneys on deposit therein. Ail income and earnings received from the investment and reinvestment of moneys on deposit in the Principal Account, Bond Redemption Account and Debt Service Reserve Account in the Sinking Fund shall be transferred to the Interest Account and be credited against any moneys required to be.deposited into the Interest Account as provided in the Resolution. Ail income and earnings received from the investment and reinvestment of moneys on deposit in the Interest Account in the Sinking Fund shall be retained therein and be credited against any moneys required to be deposited into the Interest Account as provided in the Resolution. Ail income and earnings received from the invest- ment and reinvestment of moneys on deposit in the Pledged Impact Charge Fund and shall be retained therein and used in the manner pro- vided for in this Resolution. E. SALE OF THE COMBINED PUBLIC UTILITY. Except as oth- erwise provided herein, the Combined Public Utility may be sold, leased or otherwise disposed of only as a whole or substantially as a whole, and only if the net proceeds to be realized, together with other moneys lawfully available for ~uch purpose, if any, shall be sufficient to retire all of the Bonds issued pursuant to the 38 Reso. No. 45-84 Resolution and to pay all interest thereon to their respective dates of maturity or earlier redempt, ion dates in the manner provided in Section 4.R. of this Resolution. The proceeds from such sale, lease or other d~sDosition of the Combined Public Utility and such other available moneys shall be applied in the manner provided in Section 4.R. of this Resolution and shall be used solely for the pur- poses of paying the principal of the Bonds, the interes~ thereon and redemption premiums, if any, as the same shall become due on the Bonds on or prior to the redemption date or the maturity date thereof as shall be hereafter determined by subsequent proceedings of the City Council. Except as above provided, prior to any sale, lease or other disposition of the Combined Public Utility or any portion thereof, if the amount to be received therefor is not in excess of one per centum (1%) of the original cost before depreciation of the fixed assets to be sold, leased or otherwise disposed, the general manager or other duly authorized officer in charge of the Combined Public Utility shall make a finding in writing determining that such property com- prising a part of such Combined Public Utility is no longer necessary or useful or profitable in the operation thereof, and such proceeds shall be deposited in the Renewal, Replacement and Improvement Fund to the extent necessary to make the amount then on deposit therein equal to the maximum amount required to be on deposit therein and the balance of such moneys not needed for said Renewal, Replacement and Improvement Fund shall be deposited in the Bond Redemption Account and used in the manner provided therein. If the amount to be received from such sale, lease or other disposition of said property shall be in excess of one per centum (1%) of the original cost before depreciation of the fixed assets, the general manager or other duly authorized officer in charge of such Combined Public Utility and the Consulting Engineer, shall first each make a finding in writing determining that such property 39 Reso. No. 45-84 comprising a part of such Combined Public Utility is no longer necessary or useful or profitable in the operation thereof, and the City Council shall, by resolution duly adopted, approve and concur in the findings of the general manager or other duly authorized officer and the Consulting Engineer, and authorize such sale, lease or other disposition .of said property and such proceeds shall be deposited into the Renewal, Replacement and Improvement Fund to the extent nec- essary to make the amount then on deposit therein equal to the maxi- mum amount required to be on deposit therein, and the balance of such moneys not needed for said deposit into the Renewal, Replacement and Improvement Fund shall be deposited in the Bond Redemption Account and used in the manner provided therein. Notwithstanding the foregoing provisions of this Section E, the City shall have the authority to sell for fair and reasonable consideration any land comprising a part of the Combined Public Utility which is no longer necessary or useful in the operation of the Combined Public Utility and the proceeds derived from the sale of such land shall be deposited in the Renewal, Replacement and Improvement Fund and applied to the purposes provided therein. F. ISSUANCE OF OTHER OBLIGATIONS PAYABLE OUT OF NET REVENUES AND PLEDGED IMPACT CHARGES. The City will not issue any other obligations, except upon the conditions and in the manner pro- vided herein, payable from the Net Revenues and the Pledged Impact Charges, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or any other charge having pri- ority or being on a ~arity with the lien of the Bonds issued pursuant to the Resolution and the interest thereon upon any of the Net Revenues and the Pledged Impact Charges. Any obligations issued by the City other than the Bonds authorized by the Resolution and any 9ari passu additional Bonds issued under ~he terms, restrictions and conditions contained in the Resoluti.on, shall contain an express statement that such obligations are junior, inferior and subordinate 40 Reso. No. 45-84 in all respects to the Bonds issued pursuant to the Resolution as to lien on and soUrce and security, for payment from the Net Revenues and the Pledged Impact Charges and in all other respects. ~. ISSUANCE OF PARI PASSU ADDITIONAL BONDS. N o p a r i passu additional Bonds, as in this subsection defined, payable pari passu with Bonds issued pursuant to the Resolution out of Net Revenues and Pledged Impact Charges shall be issued al%er the issu- ance of any Bonds pursuant to the Resolution except upon the condi- tions and in the manner herein provided. No such pari passu additional Bonds shall be issued unless the following conditions are complied with.- (1) The City must be current in all deposits into the various funds and accounts and all payments required to have been theretofore deposited or made by it under the provisions of the Resolution and any supplemental resolu- tions hereafter adopted for the issuance of pari passu additional Bonds and has complied with the covenants and provisions of the Resolution and any supplemental resolu- tions hereafter adopted for the issuance of pari passu additional Bonds. (2) The amount of the Net Revenues derived from the operation of the Combined Public Utility, as may be adjusted by subparagraphs (a), (b) or (c) as hereinafter provided, received during any twelve (12) consecutive months of the eighteen (18) months immediately preceding the issuance of said pari passu additional Bonds, as certi- fied by th~ City, will either (i) be at least equal to one hundred and twenty per centum (120%) of the Maximum Annual Debt Service Requirement or (ii) if further adjusted by subparagraphs (d) and/or (e) of this Sectin 4.G. the Net Revenues derived from the operation of the Combined Public Utility received during any twelve (12) consecutive months 41 Reso. No. 45-84 of the eighteen (18) months immediately preceding the issuance-of said pari pass. u additional Bonds, .as certified by the City, will be at least equal to one hundred and thirty-five per centum (135%) of the Maximum Annual Debt Service Requirement; on (1) the Bonds originally issued pursuant to the Resolution then Outstanding, (2) any pari passu additional Bonds theretofore issued a~d then Outstanding, and (3) the pari passu additional Bonds then proposed to be issued; provided that for the purpose of determining the Maximum Annual Debt Service Requirement under this Section, the interest rate on Variable Rate Bonds then outstanding shall be the greater of (i) the average daily interest rate on such Variable Rate Bonds during the preceding Fiscal Year or (ii) the actual rate of interest applicable to such Variable Rate Bonds on the date of issuance of such Variable Rate Bonds; and provided, fur- ther, that if pari 9assu additional Variable Rate Bonds are to be issued the interest rate thereon shall be calculated in accordance with the 30 year Revenue Bond Index as pub- lished by The Bond Buyer as of the last week of the month preceding the date of issuance of such Variable Rate Bonds, or if that index is no longer published, the interest rate as of the last week of such month as published in an index that is deemed to be substantially equivalent. (3) In the event any pari ~assu additional Bonds issued for the purpose of refunding any' Bonds then Outstanding, the condftion of (2) above shall not apply, provided that the issuance of such pari passu additional Bonds shall result in a reduction or shall not increase the annual debt service payments over the life of the Bonds so refunded. : 42 Reso, No, 45-84 For the purpose of this Section 4.G., the phrase 'twelve '-(12) consecutive months of ~he eighteen (18) months immediately preceding .the issuance of said pari 9assu addi- tional Bonds' shall be sometimes referred to as "twelve (12) consecutive months". The adjustment of Net Revenues which are permitted by the foregoing subsection (2) hereof shall be certffied to by the Consulting Engineer and shall be computed as follows: (a) If the City, prior to the issuance of the proposed pari passu additional Bonds, shall have increased the rates, fees, rentals or other charges for the services of the Combined Public Utility, the Net Revenues for the twelve (12) consecutive months immediately preceding the issuance of the pari passu additional Bonds shall be adjusted to include the Net Revenues which would have been derived from said Combined Public Utility in such twelve (12) consecu- tive months as if such increased rates, fees, rentals or other charges for the services of the Combined Public Utility had been in effect during all of such twelve (12) consecutive months. '(b) If the City shall have acquired or has con- tracted to acquire any privately or publicly owned existing water system, sewer system or water and sewer system, the cost of which shall be paid from all or part of the proceeds of the issuance of the proposed pari passu additional Bonds, then the Net Revenues derived from the Combined Public Utility during the twelve (12) consecutive months immediately preceding the issuance of said pari .passu additional Bonds, shall be increased by adding to the Net Revenues for 43 Reso. No. 45-84 such twelve (12) consecutive months seventy-five percent (75%) of the. Net Revenues which would have been derived from the existing water system, sewer ~ystem or water and sewer system as if such existing water system, sewer system or water and sewer system had been operated by the City as a part of the Combined Public Utility during such twelve (1'2) con- secutive months. (c) If the City shall have entered into a con- tract, which contract shall be for a duration of not less than the final maturity of the pari passu addi- tional Bonds authorized for the purposes of such financing from the date of the issuance of the pro- posed pari passu additional Bonds, with any public body whereby the City shall have agreed to furnish services for the collection, treatment and disposal of sewage or other waste matter and/or agreed to furnish services in connection with any water system, then the Net Revenues of the Combined Public Utility during the twelve (12) consecutive months immediately preceding the issuance of the pari passu additional Bonds shall be increased by the least amount which the public body shall guarantee to pay in any one year for the fur- nishing of the services by the City, after deducting from such payment the estimated proportion of operat- ing expenses and repair, renewal and replacement cost attributable in such year to such services. (d) If there is an estimated increase in Revenues to be received by the City as a result of additions, extensions or improvements to the Combined Public Utility during the period of three (3) years from delivery of the pari passu additional Bonds, then 44 Reso. No. 45-84 the Net Revenues derived from the Combined Public utility during the .twelve (12) consecutive months immediate, ly preceding the issuance of said ~ari 9assu additional Bonds shall be increased by the average annual additional Revenues calculated for such three year period. (e) If the City shall impose and collect Pledged Impact Charges, then the Net Revenues derived from the Combined Public Utility during the twelve (12) consecutive months immediately preceding the issuance of said pari passu additional Bonds shall be increased by such Pledged Impact Charges collected during such twelve (12) consecutive month period. The term "pari 9assu additional Bonds' as used in this sub- section shall be deemed to mean additional obligations evidenced by Bonds issued under the provisions and within the limitations of this subsection payable from the Net Revenues of the Combined Public Utility and the Pledged Impact Charges 9ari ~assu with Bonds origi- nally authorized and issued pursuant to the Resolution. Such Bonds shall be deemed to have been issued pursuant to the Pledged Resolution the same as the Bonds originally authorized and issued pursuant to the Resolution and all of the covenants and other provi- sions of the Resolution (except as to details of such Bonds evidenc- ing such pari passu additional obligations inconsistent therewith), shall be for the equal benefit, protection and security of the Holders of any Bonds originally authorized and issued pursuant to the Resolution and the holders of any Bonds evidencing ~ari 9assu addi- tional obligations subsequently issued within the limitations of and in compliance with this subsection. Ail of such Bonds, regardless of the time or times of their issuance shall rank equally with respect to their lien on the Net Revenues of .the Combined Public Utility and 45 Resoo No. 45-84 the Pledged Impact Charges, and their sources and security for payment theref'~om without pref. erence of any Bonds, over any other. The term '~ari passu additional Bonds' as used in this sub- section shall not be deemed to include bonds, notes, certificates or other obligations subsequently issued under the terms of the Resolution, the lien of which on the Net Revenues of the Combined Public Utility and the Pledged Impact Charges is subject'to the prior and superior lien on the Net Revenues and the Pledged Impact Charges of Bonds issued pursuant to the Resolution, as provided in Section 4.F. of this Article III, and the City shall not issue any obliga- tions whatsoever payable from the Net Revenues of the Combined Public Utility and the Pledged Impact Charges which rank equally as to lien on and source and security for their payment from such Net Revenues and Pledged Impact Charges, with Bonds issued pursuant to the Resolution except in the manner and under the conditions provided in this subsection. In the event that the total amount of the Bonds herein authorized to be issued are not issued simultaneously but from time to time, such Bonds which are subsequently issued from time to time shall not be subject to the restrictions, conditions and limitations as to the issuance of pari passu additional Bonds as provided in this Section 4G of the Resolution, provided, that such Bonds which are subsequently issued shall be issued within six (6) months from the date the Bonds originally authorized hereunder are issued. If at any time the City shall enter into an agreement or contract for an ownership interest in any public or privately owned water and/or sewer system or for the reservation of capacity therein whereby the City has agreed as part of the cost thereof to pay part of the debt service on the obligations of such public or privately owned water and/or sewer system issued in connection therewith, such payments to be made by the City shall be junior, inferior and subordinate in all respects to the Bonds issued hereunder and to any 46 Reso. No. 45-84 other obligations hereafter issued by the City under the provisions of Section 4.F~ hereof. H. INSURANCE. The City will carry such insurance as is ordinarily carried by private or public corporations owning and oper- ating utilities similar to the Combined Public Utility with a reputa- ble insurance carrier or carriers, including public and product liability insurance in such amounts as the City shall determine to be sufficient and such other insurance against loss or damage by fire, explosion (including underground explosion), hurricane, tornado or other hazards and risks, and said property loss or damage insurance shall at all times be in an amount or amounts equal to the fair appraisal value of the buildings, properties, furniture, fixtures and equipment of the Combined Public Utility, or such other amount or amounts as the Consulting Engineer shall approve as sufficient. The City may establish certain minimum levels of insurance for which the City may self-insure. Such minimum levels of insurance shall be in amounts as recommended by the Independent Insurance Co ns ul rant. I. BOOKS AND RECORDS. The City will keep books and records of the combined Public Utility, which shall be separate and apart from all other books, records and accounts of the City, in which complete and correct entries shall be made of all transactions relating to the Combined Public Utility, in accordance with generally accepted accounting principles for governmental units, and any Holder or Holders of Bonds or their agents issued pursuant to the Resolution, shall have the right at reasonable times and under rea- sonable conditions to inspect all records, accounts and data of the City relating to the operation of the Combined Public Utility. The City shall promptly be required to obtain an audit by a qualified and independent firm of certified public accountants of the books, records and accounts of the Combined Public Utility for the preceding Fiscal Year which shall be completed within six (6) months 47 Reso. No. 45-84 after the =lose of each Fiscal Year, and the financial statement prepared by '-such certified publ. ic accountants shall be filed with the City, which' such financial statement shall cover in reasonable detail the operation of the Combined Public Utility, the _funds and fund bal- ances and the City shall make available upon request a reasonable summary thereof, to any Holder or Holders of the Bonds issued pursu- ant to the Resolution. ' J. OPERATING BUDGET. The City shall annually, prior to the start of each Fiscal Year, prepare and adopt by proper proceed- ings of its governing body a detailed budget of the estimated expen- ditures for operation and maintenance of the Combined Public Utility and the estimated Revenues of the Combined Public Utility during the succeeding Fiscal Year. No expenditures for the operation and main- tenance of the Combined Public Utility shall be made in any Fiscal Year in excess of the amounts provided therefor in such budget with- out a written finding and recommendation by the general manager of the Combined Public Utility or other duly authorized officer in charge thereof, which finding and recommendation shall state in detail the purpose of and necessity for such increased expenditures for the operation and maintenance of the Combined Public Utility, and no such increased expenditures shall be made until the governing body of said City shall have approved such finding and recommendation by a resolution duly adopted. The City shall mail copies of such annual budget and all resolutions authorizing increased expenditures for operation and maintenance to the Holder or Holders of Bonds who shall file his address with the City and request in writing that copies of all such budgets and resolutions be furnished him or them, and shall make available such budgets and all resolutions authorizing increased expenditures for operation and maintenance of the Combined Public Utility at all reasonable times to any Holder or Holders of Bonds issued pursuant to the Resolution. 48 Reso. No. 45-84 K. MAINTENANCE OF THE COMBINED PUBLIC UTILITY. The City will maintain said Combined Public Utility in good condition and continuously operate the same in an efficient manner and at a reason- able cost'as a City revenue producing enterprise. The City shall also at the end of every second Fiscal Year, cause the Combined Public Utility to be inspected by the Consulting Engineer, who shall make a written report of such ins~ction and of the condition of the Combined Public Utility of the City and file such annual report with the City, and the City shall mail upon request, and make available generally, the report of said Consulting Engineer, or a reasonable summary thereof, to any Holder or Holders of Bonds issued pursuant to the Resolution. L. NO FREE SERVICE. The City will not render or cause to be rendered any free services of any nature by its Combined Public Utility or any part thereof, nor will any preferential rates be established for users of the same class, and in the event the City, or any department, agency or instrumentality, officer or employee thereof, shall avail itself of the Facilities or services provided by said Combined Public Utility or any part thereof, the same rates, fees or charges applicable to other customers receiving like services under similar circumstances shall be charged the City and any such department, agency, instrumentality, officer or employee, provided, however, that this subsection shall not affect any rights of person, firm or corporation under pre-existing agreements or contracts. Such charges shall be paid as they accrue, and the City shall transfer from its general funds sufficient moneys to pay such charges. The revenues so received shall be deemed to be Revenues derived from the operation of the Combined Public Utility, and shall be deposited and accounted for in the same manner as other Revenues. M. REMEDIES. Any Holder of Bonds issued under the provisions of the Resolution or a.ny trustee acting for such Bondholders in the manner hereinafter provided, may either at law or 49 Reso. No. 45-84 in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdicti.on, protect and enforce any and all rights under the laws of the State of Florida, or granted and con- tained in'the Resolution, and may enforce and compel the performance of all duties required by the Resolution or by any applicable stat- utes to be performed by the City or by any officer ~hereof, including the fixing, charging and collecting of rates, fees or 8ther charges for the services and Facilities of the Combined Public Utility. In the event that default shall be made in the payment of the interest on or the principal of any of the Bonds issued pursuant to the Resolution as the same shall become due, or in the making of the payments into any reserve or sinking fund or any other payments required to be made by the Resolution, or in the event that the City or any officer, agent or employee thereof shall fail or refuse to comply with the provisions of the Resolution or shall default in any covenant made herein, and in the further event that any such default shall continue for a period of sixty (60) days, any Holder of such Bonds, or any trustee appointed to represent Bondholders as hereinaf- ter provided, shall be entitled as of right to the appointment of a receiver of the Combined Public Utility in an appropriate judicial proceeding in a court of competent jurisdiction, whether or not such Holder or trustee is also seeking or shall have sought to enforce any other right or exercise any other remedy in connection with Bonds issued pursuant to the Resolution. The receiver so appointed shall forthwith, directly or by his agents and attorneys, enter into and upon and take possession of the Combined Public Utility, and each and every part thereof, and shall hold, operate and maintain, manage and control the Combined Public Utility, and each and every part thereof, and in the name of the City shall exercise all the rights and powers of the City with respect to the Combined Public Utilit~y as the City itself might do. Such receiver shall collect and receive all Revenues and Pledged 5O Resoo No, 45-84 Impact Charges and maintain and operate the Combined Public Utility in the manner Provided in the .Resolution and comply under the juris- diction of the court appointing such receiver, with all of the provi- sions of t~e Resolution. Whenever all that is due upon Bonds issued pursuant to the Resolution, and interest thereon, and under any covenants of the Resolution for reserve, sinking fund or other funds, ~nd upon any other obligations and interest thereon having a charge, lien or encumbrance upon the Revenues of the Combined Public Utility and the Pledged Impact Charges, shall have been paid and made good, and all defaults under the provisions of the Resolution shall have been cured and made good, possession of the Combined Public Utility shall be surrendered to the City upon the entry of an order of the court to that effect. Upon any subsequent default, any Holder of Bonds issued pursuant to the Resolution, or any trustee appointed for Bondholders as hereinafter provided, shall have the right to secure the further appointment of a receiver upon any such subsequent default. Such receiver shall in the performance of the powers here- inabove conferred upon him be under the direction and supervision of the court making such appointment, shall at all times be subject to the orders and decrees of such court and may be removed thereby and a successor receiver appointed in the discretion of such court. Nothing herein contained shall limit or restrict the jurisdiction of such court to enter such other and further orders and decrees as such court may deem necessary or appropriate for the exercise by the receiver of any function not specifically set forth herein. Any receiver appointed as provided herein shall hold and operate the Combined Public Utility in the name of the City and for the joint protection and benefit of the City and Holders of Bonds issued pursuant to the Resolution. Such receiver shall have no power to sell, assign, mortgage or otherwise dispose of any assets of any kind or character belonging or pertaining to the Combined Public 51 Reso. No. 45-84 Utility, except as provided herein, but the authority of such receiver shall be limited to the possession, operation and mainte- nance of the Combined Public Utility for the sole purpose of the pro- tection or'both the City and the Bondholders'. The Holder or Holders of Bonds in an aggregate principal amount of not less than fifty-one 9er centum (51%) of Bonds issued under the Resolution then Outstanding may by a duly executed certifi- cate in writing appoint a trustee for Holders of Bonds issued pursu- ant to the Resolution with authority to represent such Bondholders in any legal proceedings for the enforcement and protection of the rights of such Bondholders. Such certificate shall be executed by such Bondholders or their duly authorized attorneys or representa- tives, and shall be filed in the office of the City Clerk. N. ENFORCEMENT OF COLLECTIONS. The City will diligently enforce and collect all fees, rentals or other charges for the ser- vices and Facilities of the Combined PubIic Utility, and take all steps, actions and proceedings for the enforcement and collection of such fees, rentals or other charges which shall become delinquent to the full extent permitted or authorize~ by the laws of the State of Florida. The City will, to the full extent permitte~ by law, under reasonable rules and regulations shut off and discontinue the supply- ing of the services and Facilities of the Combined Public Utility for the nonpayment of fees, rentals or other charges for said water and sewer services, and will not restore said water and sewer services until all delinquent charges', together with interest and reasonable penalties, have been paid in full. Where the user of the Sewer System is also a customer of the Water System, the City shall furnish to such a customer a single bill containing the charges due for the use of the services and Facilities of the Sewer System and Water System and the City will, to the full extent permitted by law, 52 Reso. No. 45-84 discontinue furnishing water service to such user in the event of the non-payment '-of" charges imposed, for the services of the Sewer System. O. CONNECTIONS WITH THE SEWER SYSTEM. The City will, to the full extent permitted by law, require all lands, buildings and structures within the area of the Combined Public Utility which can use the Facilities and services of the Sewer System of the Combined Public Utility, to connect with and use the Facilities'and services of such Sewer System, and to cease all other means and methods for the collection, purification, tre&tment and disposal of sewage and waste matter. P. NO COMPETING FACILITIES. The City will, to the full extent permitted by law, not grant any franchise, license or permit, for the construction or operation of any water and sewer facilities which will be competitive with the services and Facilities of the water and/or Sewer System; provided, however, that this subsection shall not affect any vested rights of any persons, firms or corpora- tions now owning or operating water and sewer facilities. Q. CONSULTING ENGINEER. The City will retain a Consulting Engineer, on an biannual basis to inspect the Combined Public Utility, to make a report concerning the same, and will fur- ther retain the Consulting Engineer as may be necessary in order to perform the duties provided in the Resolution for the Consulting Engineer. R. DISCHARGE AND SATISFACTION OF BONDS. The covenants, liens and pledges entered into, created or imposed pursuant to the Resolution may be fully discharged and satisfied with respect to the Bonds in any one or more of the following ways: (a) by paying the principal of and interest on Bonds when the same shall become due and payable; or (b) by depositing in the Interest Account, Principal Account and the Bond Redemption Account, or in such other accounts which are irrevocably pledged 53 Reso. No. 45-84 to the payment of the Bonds, as the City may hereafter cr'~ate 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, all appurtenant interest coupons, if any, and the redemption premium, if any, as the same become due on said Bonds on or prior to the redemption date or maturity date thereof; or (c) by depositing in the Interest Account, Principal Account and the Bond Redemption 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 U.S. Obligations or in time deposits in bank or trust companies fully secured by U.S. obli- gations, will provide moneys which shall be sufficient to pay the Bonds, all appurtenant interest coupons, if any, and the redemption premium, if any, as the same shall become due on said Bonds on or prior to the redemption date or maturity date thereof. (d) Notwithstanding the foregoing all refer- ences 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. For the purposes of determining the amount of interest on Variable Rate Bonds whether discharged and satisfied under the provisions of subsections (a), (b) and (c) above, the amount required for the interest thereon shall be calculated at the maximum rate 54 Reso. No. 45-84 permitted by the terms of the provisions which authorized the issuance of-suCh Variable Rat? Bonds. Upon such payment or deposit in the amoun~andmanner pro- vided in this Section 4.R. of Article III, 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, ter- minate and be completely discharged and extinguished, ana the Holders thereof shall be entitled for payment solely out of the moneys or securities so deposited. S. VALUATION. The value of Permitted Investments on deposit in the funds and accounts created and established under this Resolution shall be the lower of par, or if purchased at other than par, amortized value. Amortized value, when used with respect to securities purchased at a premium above or a discount below par, shall mean the value at any given date obtained by dividing the total premium or discount at which such securities were purchased by the number of interest payment dates remaining to maturity on such secu- rities after such purchase and by multiplying the amount so calcu- lated by the number of interest payment dates having passed since the date of purchase; and (i) in the case of securities Purchased at a premium, by deducting the product thus obtained from the purchase price, and (ii) in the case of securities purchased at a discount, by adding the product thus obtained to the purchase price. 55 Reso. No. 45-84 SECTION 1. ~IODIFICATION OR A~ENDMENT. Except as otherwise provided tn the second paragraph hereof, no material modification or amendment of the Resolution, or of any resolution amendatory thereof or supplemental thereto, may be made without 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 amend- ment shall permit a change in the maturity of such Bonds or a reduc- tion in the rate of interest thereon, or affecting the unconditional promise of the City to fix, maintain and collect fees, rentals and other charges for the Combined Public Utility or to pay the interest of and principal on the Bonds, as the same mature or become due, from the Net Revenues of the Combined Public Utility and the Pledged Impact Charges, 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, (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 provide other changes which will not adversely affect the interest of such Holder of Bonds and (iii) to provide for the issuance of Bonds in coupon form if, in the opinion of a nationally recognized bond counsel, such issuance will not affect the exemption from federal income taxation of interest on the Bonds. SECTION 2. SEVERABILITY OF INVALID PROVISIONS. If any one or more of the covenants, agreements or provisions of the 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 56 Reso. No. 45-84 and void and shall be deemed separate frou the renainir~ covenants, agreements or prOViSions, and .shall in no way a~fect the validity of any o£ the other provisions of the Resolution or of the Bonds oc cou- pons issued hereunder. SECTION $. VALIDATI(IJ ~l~). That Herbert W.A. Thiele, as attorney for the City or his successor, ia hereby authorized to take appropriate proceedings in the Circuit Court of ~he Fifteenth Judicial Circuit of Florida in and for Palm Beach County for the val- idation of the Bonds, and the Nayor and City Clerk are hereby autho- rized ko siqn any pleadings in such proceedtnqs for and on behalf of the City Council of the City of Delray Beach. SECTION 4. SALE OF BOHDS. The Bonds shall be issued and sold ak one time or from time to time, in such manner and ak such price or prices consistent with the provisions of the Ack and the requirements of the Resolution as the City Council shall hereafter determine by subsequent proceedings. SECTION 5. REPEALER. That all resolutions or riders or parks thereof in conflict herewith are to the extent of such conflict hereby repealed. SECTION ~. EFFECTIVE DATE. That this Resolution shall take effect upon its passage in the manner prov±ded by law. PA.C$~.D AND ADOPTED in regular session on this the 12th day of ~une, 1984. ATTE ST: 57 Reso. No. 45-84