Ordinance No. 80-85-26 vORDINANCE '2TO. 80-85-26
AN ORDINANCE ACCEPTING THE OFFER OF THE
STOCKHOLDERS OF BUCCANEER SERVICE COMPANY, INC. TO
SELL ALL OF ITS ISSUED AND OUTSTANDING CAPITAL STOCK
TO THE CITY FOR THE PURPOSE OF ACQUIRING THE WATER
AND SEWER SYSTEM OWNED AND OPERATED BY BUCCANEER
SERVICE COMPANY, INC. DESCRIBED IN SAID OFFER FOR
THE PURCHASE PRICE SET FORTH IN THE ATTACHED STOCK
PURCHASE AGREEMENT; ESTABLISHING THE BUCCANEER
WATER AND SEWER DISTRICT OF THE CITY WITHIN WHICH
THE CITY WILL PROVIDE WATER AND SEWER SERVICES
THROUGH THE SYSTEM PURCHASED; AUTHORIZING THE
ISSUANCE OF BUCCANEER WATER AND SEWER DISTRICT
REVENUE BONDS FOR PAYMENT OF THE PURCHASE PRICE OF
THE STOCK; AUTHORIZING PAYMENT OF THE BONDS FROM
THE NET REVENUES AND AVAILABLE IMPACT FEES OF THE
UTILITY SYSTEM SERVING BUCCANEER WATER AND SEWER
DISTRICT; AUTHORIZING AND DIRECTING CERTAIN OFFICERS
OF THE CITY TO EXECUTE THE STOCK PURCHASE
AGREEMENT AND OTHER DOCUMENTS, AND TAKE CERTAIN
ACTION IN CONNECTION THEREWITH; DIRECTING THAT
BUCCANEER SERVICE COMPANY, INC. BE COMPLETELY
LIQUIDATED AND DISSOLVED IMMEDIATELY AFTER
PURCHASE AND PROVIDING FOR ALL NECESSARY ACTION
THEREFOR; AND PROVIDING AN EFFECTIVE DATE.
BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF ATLANTIC
BEACH, FLORIDA.
Section 1. AUTHORITY FOR THIS ORDINANCE. This ordinance is
enacted pursuant to the provisions of Chapter 180, Florida Statutes (1983), as amended,
and other applicable provisions of law.
Section 2. FINDINGS. It is hereby found and determined as follows:
A. On March 25, 1985, the City adopted a resolution (the "Resolution")
making a preliminary determination that the purchase of the water and sewer system
owned and operated by Buccaneer Service Company, Inc., the financing of the cost of
acquisition by the issuance of revenue bonds of the City, and the establishment of
Buccaneer Water and Sewer District within which the City will provide water and sewer
services through the system purchased, was in the public interest, and scheduled a public
hearing with respect thereto.
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B. The public hearingwas held at the time and place set forth in the
Resolution, and, after consideration of all matters presented to the City at such public
hearing, the City has determined that the adoption of this ordinance and implementation
of the acquisition of the utility system, the financing thereof, and the establishment of
Buccaneer Water and Sewer District is in the public interest. In making such
determination, the City has considered all of the factors set forth in the Resolution, and
the statement showing that the purchase is in the public interest, in the form attached to
the Resolution, is hereby adopted as a final statement with respect thereto.
C. The City deems it necessary and advisable for the public health,
safety and welfare of its citizens to (1) provide extensions and improvements to its water
and sewer system by the acquisition of the water and sewer system (the "Utility System")
owned by Buccaneer Service Company, Inc., a Florida corporation (the "Company") by
purchase of all of its issued and outstanding capital stock (the "Stock") from the present
owners of the stock (the "Seller"), pursuant to the "Stock Purchase Agreement between
the City and the Stockholders of Buccaneer Service Company, Inc.," dated May 20, 1985,
in the form attached hereto as Exhibit A, and thereafter to immediately and completely
dissolve and liquidate the Company, (2) finance the cost of purchase of the Stock by
issuance of the Bonds described herein and in the Agreement, and (3) to establish
Buccaneer Water and Sewer District ("Buccaneer District"), within which the City shall
provide water and sewer services through the Utility System, as the same may be
extended or improved hereafter (the "Buccaneer District System").
D. The cost of acquiring the Utility System is as set forth in the
Agreement.
E. The estimated annual Net Revenues and Available Impact Fees to
be hereafter derived by the City from the operation of the Buccaneer District System will
be sufficient to pay the principal of and interest on the Bonds pursuant to the terms and
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conditions of the Agreement and this Ordinance and to make all other payments required
hereunder and under the Agreement.
F. The principal of and interest on the Bonds will be payable solely
from the Net Revenues and Available Impact Fees derived by the City from the operation
of the Buccaneer District System. It will never be necessary or authorized for the ad
valorem taxing power of the City, the State of Florida or any political subdivision thereof,
to be exercised to pay the principal of or interest on the Bonds or to make any required
payments under this Ordinance or under the Agreement, and the Bonds shall not constitute
a lien upon any property of or in the City, except the Net Revenues and Available Impact
Fees of the Buccaneer District System.
G. The City has not issued any other obligations which are payable
from the Net Revenues or the Available Impact Fees, and the Net Revenues and Available
Impact Fees of the Buccaneer District System are unpledged revenues of the City.
Section 3. APPROVAL OF AGREEMENT AND NEGOTIATED SALE OF
BONDS. The City hereby approves the Agreement and the terms and conditions provided
therein and authorizes the Mayor and City Manager to execute the Agreement and
authorizes such officers and the City Attorney to take all action and execute all
documents necessary to implement and close the transaction contemplated by this
Ordinance and the Agreement. The City hereby finds, determines and declares that it is
in its best interest to issue the Bonds contemplated hereby upon the conditions set forth
herein and in the Agreement. The negotiated sale of the principal amount of Bonds stated
in the Agreement is hereby authorized pursuant to Section 218.385, Florida Statutes
1983). The City acknowledges receipt of the information required by Section 218.385,
Florida Statutes (1983), in connection with negotiated sale of bonds. A copy of the
Sellers' letter containing the required information is attached to this Ordinance as Exhibit
B".
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Section 4. LIQUIDATION AND DISSOLUTION OF
SELLER. Immediately following the purchase of the Stock of the Company by the City,
the Mayor is hereby authorized and directed to execute for and on behalf of the City, as
sole stockholder of the Company, a consent voting the Stock for the adoption of a
corporate resolution to immediately and completely liquidate and dissolve the Company
and to elect the Mayor and City Manager as President and Secretary, respectively, of the
Company for the sole purpose of and with full authorization and direction to take
necessary action to convey immediately all of the assets of the Company to the City, and
to execute any and all documents necessary to and for the express purpose of immediately
carrying out the complete liquidation and dissolution of the Company, including but not
limited to Certificate of Resolution on Dissolution, Affidavit of Taxes, Deeds, Assignment
of Easements, Bill of Sale and Assignment of Tangible and Intangible Personal Property,
all of such documents being subject to approval as to form and correctness by the City
Attorney. Further, the City Attorney is authorized and directed to take such action as
may be reasonable and necessary to carry out the dissolution and liquidation.
Section 5. ESTABLISHMENT OF BUCCANEER WATER AND SEWER
DISTRICT. Upon the acquisition of the Stock of the Company by the City, the area
described in Exhibit J attached to the Agreement and made a part thereof, which
constitutes the service area of the Utility System, is hereby fixed and established as
Buccaneer Water and Sewer District of the City. The City shall provide water and sewer
services to properties within Buccaneer District through the Utility System acquired, as
the same be extended or improved hereafter (the "Buccaneer District System").
Section 6. DEFINITIONS. All defined terms in the Agreement shall
have the same meaning herein. In addition, the following terms shall have the following
meanings herein, unless the text otherwise expressly requires. Words importing singular
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number shall include the plural number in each case and vice versa, and words importing
persons shall include firms and corporations.
Act" shall mean Chapter 180, Florida Statutes (1983), as amended, and other
applicable provisions of law.
Additional Bonds" shall mean Bonds issued on a parity with the Initial Bonds
under Section 17 Q hereof.
Amortization Installments" with respect to any Term Bonds of a series, shall
mean an amount or amounts so designated which is or are established for the Term Bonds
of such series, provided that (i) each such installment shall be deemed to be due on such
interest or principal maturity date of each applicable year as is fixed by resolution of the
City and shall be in an Authorized Denomination, and (ii) the aggregate of such
installments for such series shall equal the aggregate principal amount of Term Bonds of
such series authenticated and delivered on original issuance.
Authorized Denomination" shall mean (i) as to the Initial Bonds, three Bonds
in the amount of $873,600 each and one Bond in the amount of $179,200, and (ii) as to
Additional Bonds, $5,000 or a multiple thereof.
Authorized Investments" shall mean investments permitted under Section
166.261, Florida Statutes (1984), as in effect on the date of adoption of this Ordinance.
Available Impact Fees" shall mean all Impact Fees received, multiplied by a
fraction, the numerator of which is the total Bond Service Requirements in all Fiscal
Years applicable to Bond issued to finance the cost of acquisition or construction of
additions or expansions to the capacity of the Buccaneer District System and the
denominator of which is the total Bond Service Requirements in all Fiscal Year applicable
to all Bonds.
Bondholder" shall mean a registered owner of a Bond as shown on the
registration books of the Registrar.
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Bond Service Requirement" for any Fiscal Year, as applied to the Bonds of
any series, shall mean the sum of:
1) the amount required to pay the interest becoming due on the Bonds of
such series during the Fiscal Year, except to the extent that such interest shall have been
provided by payments into the Sinking Fund out of bond proceeds for a specific period of
time;
2) the amount required to pay the principal of Serial Bonds of such series
maturing in such Fiscal Year; and
3) the Amortization Installments for the maturities of Term Bonds of such
series for such Fiscal Year.
Bonds" shall mean the Initial Bonds, together with any Additional Bonds
hereafter issued under the terms, conditions, and limitations contained herein.
Buccaneer District System" shall mean the Utility System to be acquired
under the Agreement, as the same may be extended or improved hereafter, serving
properties within Buccaneer District, together with all lands or interests therein,
including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipment and
all property, real or personal, tangible or intangible, now or hereafter owned or used in
connection therewith, and including any undivided or partial ownership interests therein.
Consulting Engineers" shall mean such qualified and recognized consulting
engineers, having a favorable repute for skill and experience in the construction and
operation of such facilities as the Buccaneer District System, at the time retained by the
City to perform the acts and carry out the duties as herein provided for Consulting
Engineers.
Cost of Operation and Maintenance" of the Buccaneer District System shall
mean the current expenses, paid or accrued, of operation, maintenance and repair of the
Buccaneer District System as calculated in accordance with sound accounting practice,
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but shall not include any reserves for renewals and replacements, for extraordinary
repairs or any allowance for depreciation.
Federal Securities" shall mean only direct obligations of, or obligations fully
guaranteed as to principal and interest by, the United States of America.
Fiscal Year" shall mean the period commencing on October 1 of each year
and ending on the succeeding September 30, or such other period as is at the time
prescribed by law.
Gross Revenues" shall mean all income or earnings, including any income
from the investment of funds as herein provided, derived by the City from the operation
of the Buccaneer District System, excluding Impact Fees.
Impact Fees" shall mean the impact fees received by the City from
connections of new customers to the water or sewer facilities of the Buccaneer District
System.
Initial Bonds" shall mean the Buccaneer Water and Sewer District Revenue
Bonds, herein authorized.
Maximum Bond Service Requirement" shall mean, as of any particular date of
calculation, the greatest amount of aggregate Bond Service Requirements for the then
current or any future Fiscal Year.
Net Revenues" shall mean Gross Revenues of the Buccaneer District System
less the Cost of Operation and Maintenance of the Buccaneer District System.
Payment Date" shall mean, with respect to payment to the Bondholders of
principal of or interest on the Bonds, or with respect to the mandatory amortization of
Term Bonds, the date upon which payment of such principal, interest or Amortization
Installment is required to be made to the Registrar.
Project" shall mean the construction or acquisition of additions, extensions
and improvements to the Buccaneer District System.
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Registrar" shall mean the paying agent for the Bonds, as Bond Registrar, or
such other person, firm or corporation as may thereafter be from time to time designated
by the City as the Registrar for the Bonds. As to the Initial Bonds, the City Clerk shall be
the Registrar, unless a successor Registrar shall be hereafter appointed.
Serial Bonds" shall mean any Bonds for the payment of the principal of which,
at the maturity thereof, no Amortization Installments are required to be made prior to
the twelve-month period immediately preceding the stated date of maturity of such Serial
Bonds.
Term Bonds" shall mean the Bonds of a series all of which shall be stated to
mature on one date and which shall be subject to retirement by operation of the Bond
Amortization Account.
Section 7. ORDINANCE TO CONSTITUTE CONTRACT. In consid-
eration of the acceptance of the Initial Bonds by the Bondholders from time to time, this
Ordinance shall be deemed to be and shall constitute a contract between the City and
such Bondholders. The covenants and agreements herein set forth to be performed by the
City shall be for the equal benefit, protection and security of the Bondholders of any and
all of such Initial Bonds, all of which shall be of equal rank and without preference,
priority or distinction of any of the Initial Bonds over any other thereof, except as
expressly provided therein and herein.
Section 8. DESCRIPTION OF INITIAL BONDS. The Initial Bonds shall
be dated as of their date of delivery, shall be designated "R-_" and numbered
consecutively from one upward in order of authentication; shall be in Authorized
Denominations, and shall bear interest at the rate of 9.0% per annum, payable semi-
annually on October 1, 1985 and each April 1 and October 1 thereafter. Each Bond shall
mature serially in installments on October 1, 1986 and each October 1 thereafter, in
amounts such that the total annual payments of principal and interest shall be as nearly
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equal as practicable, and all principal of each Bond shall have matured on or before
October 1, 2000.
If the date for payment of the principal of, premium, if any, or interest on the
Bonds shall be a Saturday, Sunday, legal holiday or a day on which the banking institutions
in the City where the Registrar is located are authorized by law or executive order to
close, then the date for such payment shall be the next succeeding day which is not a
Saturday, Sunday or legal holiday or a day on which such banking institutions are
authorized to close, and payment on such dates and in such date shall have the same force
and effect as if made on the nominal date of payment.
The Bonds (except the Initial Bonds) may be issued or exchanged for Bonds in
coupon form, payable to bearer, in such form, with such attributes and upon such
conditions as the City may provide by supplemental resolutions, upon receipt of an opinion
from a nationally recognized bond counsel that such issuance or exchange will not cause
interest on the Bonds to be includable in gross income of the holder for federal income tax
purposes.
Section 9. EXECUTION OF BONDS. The Bonds shall be executed in the
name of the City by the Mayor and City Manager and attested by the City Clerk, and
approved as to form, sufficiency and correctness by the City Attorney, either manually or
with his facsimile signature, and the official seal of the City or a facsimile thereof shall
be affixed thereto or reproduced thereon. The facsimile signature of such officers may be
imprinted or reproduced on the Bonds. The Certificate of Authentication of the Bond
Registrar shall appear on the Bonds, and no bond shall be valid or obligatory for any
purpose or be entitled to any security or benefit under this Ordinance unless such
certificate shall have been duly executed on such Bond. The authorized signature for the
Bond Registrar shall be either manual or facsimile; provided, however, that at least one of
the signatures appearing on the Bonds, shall at all times be a manual signature. In case
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any officer whose signature shall appear on any Bonds shall cease to be such officer
before the delivery of such Bonds, such signature or facsimile shall nevertheless be valid
and sufficient for all purposes the same as if he had remained in office until such delivery.
Any Bonds may be signed and sealed on behalf of the City by such person who at the
actual time of the execution of such Bonds shall hold the proper office with the City,
although at the date of enactment of this Ordinance such person may not have held such
office or may not have been so authorized.
Section 10. NEGOTIABILITY. Subject to the provisions hereof
respecting registration and transfer, the Bonds (except the Initial Bonds) shall be and shall
have all the qualities and incidents of negotiable instruments under the laws of the State
of Florida, and each successive holder, in accepting any of the Bonds (except the Initial
Bonds), shall be conclusively deemed to have agreed that such Bonds shall be and have all
of such qualities and incidents of negotiable instruments under the Uniform Commercial
Code - Investment Securities of the State of Florida. The Initial Bonds shall not be
negotiable, and ownership of the Initial Bonds shall not be transferable except for
transfers by operation of law and transfers made with prior approval of the City. The
debt of the City evidenced by the Initial Bonds shall be subject to defenses and set-off in
accordance with the Agreement.
Section 11. REGISTRATION, EXCHANGE AND TRANSFER. There shall
be a Bond Registrar for the Bonds which may be the City Clerk or a designated bank or
trust company located within or without the State of Florida. The Bond Registrar shall
maintain the registration books of the City and be responsible for the transfer and
exchange of the Bonds. The City shall, prior to the proposed date of delivery of the
Bonds, by resolution designate the Bond Registrar and Paying Agent. The Bond Registrar
shall maintain the books for the registration of the transfer and exchange of the Bonds in
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Icompliance
with the Florida Registered Public Obligations Act and the system of1
registration as established by the City pursuant thereto.
Subject to the limitations in Section 10 of this Ordinance, Bonds may be
transferred upon the registration books, upon delivery to the Registrar, together with
written instructions as to the details of the transfer of such Bonds, along with the social
security number or federal employer identification number of such transferee and, if such
transferee is a trust, the name and social security or federal employer identification
numbers of the settlor and beneficiaries of the trust, the date of the trust and the name
of the trustee. No transfer of any Bond shall be effective until entered on the
registration books maintained by the Bond Registrar.
Upon surrender for transfer or exchange of any Bond, the City shall execute
and the Bond Registrar shall authenticate and deliver in the name of the registered owner
or the transferee or transferees, as the case may be, a new fully registered Bond or Bonds
of Authorized Denominations of the same maturity and interest rate for the aggregate
principal amount which the registered owner is entitled to receive at the earliest
practicable time in accordance with the provisions of this Ordinance. The City or the
Bond Registrar may charge the owner of such Bond for every such transfer or exchange an
amount sufficient to reimburse them for their reasonable fees and for any tax, fee, or
other governmental charge required to be paid with respect to such transfer, and may
require that such charge be paid before any such new Bond shall be delivered.
All Bonds presented for transfer, exchange, redemption or payment (if so
required by the Bond Registrar), shall be accompanied by a written instrument or
instruments of transfer or authorization for exchange, in form and with guaranty of
signature satisfactory to the Bond Registrar, duly executed by the registered holder or by
his duly authorized attorney in fact or legal representative.
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All Bonds delivered upon transfer or exchange shall bear interest from the
preceding interest payment date so that neither gain nor loss in interest shall result from
the transfer or exchange. New Bonds delivered upon any transfer or exchange shall be
valid obligations of the City, evidencing the same debt as the Bond surrendered, shall be
secured by this Ordinance and shall be entitled to all of the security and the benefits
hereof to the same extent as the Bonds surrendered.
The City and the Bond Registrar may treat the registered owner of any Bond
as the absolute owner thereof for all purposes, whether or not such Bonds shall be
overdue, and shall not be bound by any notice to the contrary.
Notwithstanding the foregoing provisions of this section, the City reserves the
right, on or prior to the delivery of the Bonds to amend or modify the foregoing provisions
relating to the registration of the Bonds by resolution or ordinance in order to comply
with all applicable laws, rules, and regulations of the United States and/or the State of
Florida relating thereto.
Section 12. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In
case any Bond shall become mutilated, or be destroyed, stolen or lost, the City may in its
discretion issue and deliver a new Bond of like tenor as the Bond so mutilated, destroyed,
stolen or lost, in exchange and substitution for such mutilated Bond upon surrender and
cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed,
stolen or lost, and upon the holder furnishing the City proof of his ownership thereof and
satisfactory indemnity and complying with such other reasonable regulations and condi-
tions as the City may prescribe and paying such expenses as the City may incur. All
Bonds so surrendered shall be cancelled by the Registrar for the Bonds. If any of the
Bonds shall have matured or be about to mature, instead of issuing a substitute Bond, the
City may pay the same, upon being indemnified as aforesaid, and if such Bonds be lost,
stolen or destroyed, without surrender thereof.
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Any such duplicate Bonds issued pursuant to this section shall constitute
original, 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 the source and
security for payment from the funds, as hereinafter pledged, to the same extent as all
other Bonds issued hereunder.
Section 13. PROVISIONS FOR REDEMPTION. The Initial Bonds shall be
redeemable, at the option of the City, on and after May 15, 1991, in whole or in part, on
any date, at the price of par plus accrued interest to the redemption date. In the case of
a partial redemption, the remaining principal balance of each Initial Bond shall be
redeemed pro rata, and each installment of principal due on each Initial Bond shall be
redeemed such that the remaining annual principal and interest payments shall be as
nearly equal as practicable.
Except for Initial Bonds, Bonds in denominations greater than an Authorized
Denomination shall be deemed to be an equivalent number of Bonds in the denomination of
the minimum Authorized Denomination, and if a Bond is of a denomination larger than the
minimum Authorized Denomination, a portion of such Bond may be redeemed, in the
amount of any Authorized Denomination. Initial Bonds may be redeemed in any even
dollar amount.
Notice of such redemption, identifying the Bonds or portions thereof called for
redemption (i) shall be filed with the paying agents and any Registrar; and (ii) shall be
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mailed by the Registrar, first-class mail, postage prepaid, to all registered owners of the fk
Bonds to be redeemed not more than thirty (30) days and not less than fifteen (15) days
prior to the date fixed for redemption at their addresses as they appear on the
registration books to be maintained in accordance with the provisions hereof. Failure to
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give such notice by mailing to any owner of Bonds, or any defect therein, shall not affect
the validity of any proceeding for the redemption of other Bonds.
Notice having been mailed and filed in the manner and under the conditions
hereinabove provided, the Bonds or portions of Bonds so called for redemption shall, on
the redemption date designated in such notice, become and be due and payable at the
redemption price provided for redemption of such Bonds or portions of Bonds on such date.
On the date so designated for redemption, notice having been mailed and filed and moneys
for payment of the redemption price being held in separate accounts in trust for the
holders of the Bonds or portions thereof to be redeemed, all as provided in this Ordinance,
interest on the Bonds or portions of Bonds so called for redemption shall cease to accrue,
such Bonds and portions of Bonds shall cease to be entitled to any lien, benefit or security
under this Ordinance, and the holders or Registered Owners of such Bonds or portions of
Bonds, shall have no rights in respect thereof except to receive payment of the
redemption price thereof.
Upon surrender of any Bond for redemption in part only, the City shall issue
and deliver to the holder thereof, the costs of which shall be paid by the holder, a new
Bond or Bonds of Authorized Denominations in aggregate principal amount equal to the
unredeemed portion surrendered.
Section 14. FORM OF BONDS. The text of the Initial Bonds, the
Certificate of Authentication and the Assignment shall be in a form which reflects the
provisions of this Ordinance, such form to be recommended by the City's bond counsel and
approved by the Mayor, such approval to be evidenced by his execution thereof.
Section 15. BONDS NOT DEBT OF CITY. The Bonds shall not be or
constitute general indebtedness of the City within the meaning of any constitutional or
statutory provision or limitation, but shall be payable solely from and secured by a prior
lien upon and pledge of the Net Revenues and Available Impact Fees as herein provided.
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No Bondholder shall ever have the right to compel the exercise of the ad valorem taxing
power of the City or taxation in any form of any real property therein to pay such bonds
or the interest thereon or be entitled to payment of such principal and interest from any
other funds of the City except from the Net Revenues and Available Impact Fees in the
manner provided herein.
Section 16. NET REVENUES AND AVAILABLE IMPACT FEES
PLEDGED. Until payment has been provided for as herein permitted, the payment of the
principal of and interest on the Bonds shall be secured forthwith equally and ratably by an
irrevocable lien on the Net Revenues and Available Impact Fees prior and superior to all
other liens or encumbrances on such Net Revenues and Available Impact Fees and the
City does hereby irrevocably pledge such Net Revenues and Available Impact Fees to the
payment of the principal of and interest on the Bonds, the reserves therefor, and for all
other required payments under this Ordinance.
Section 17. COVENANTS OF THE CITY. Until all principal of and
interest on the Bonds shall have been paid or provided for as herein permitted, the City
covenants with the Bondholders as follows:
A. REVENUE FUND. The entire Gross Revenues shall upon receipt thereof
be deposited in the "Buccaneer District Water and Sewer System Revenue Fund"
hereinafter called "Revenue Fund"), hereby created and established. Such Revenue Fund
shall constitute a trust fund for the purposes herein provided and shall be kept separate
and distinct from all other funds of the City and used only for the purposes and in the
manner herein provided.
B. DISPOSITION OF REVENUES. All funds at any time remaining on
deposit in the Revenue Fund shall be disposed of on or before the twentieth day of each
month, commencing in the month immediately following the delivery of the Initial Bonds,
only in the following manner and in the following order of priority:
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1) Moneys in the Revenue Fund shall first be used for deposit into a
fund to be known as the "Operation and Maintenance Fund", which is hereby established,
in such sums as are necessary for the Cost of Operation and Maintenance for the next
ensuing month.
2) Funds shall next be deposited into a separate fund, which is hereby
created and designated Buccaneer Water and Sewer District Revenue Bonds Sinking Fund
hereinafter called "Sinking Fund"), in such sums as will be sufficient to pay (a) the
monthly portion of all interest becoming due on the Bonds on the next interest payment
date; (b) commencing in the first month which is twelve (12) months or six (6) months
prior to the first annual or semi-annual maturity date, respectively, of any Serial Bonds,
one-twelfth (1/12) or one-sixth (1/6), respectively, of the amount of Serial Bonds which
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will become due and payable on the next annual or semi-annual principal maturity date,
respectively, and (c) one-twelfth (1/12) of the Amortization Installment required to be
made on the next annual payment date or one-sixth (1/6) of the Amortization Installment
required to be made on the next semi-annual payment date into a "Bond Amortization
Account", which is hereby created and established in the Sinking Fund. Such payments
shall be credited to a separate special account for each series of Term Bonds outstanding,
and if there shall be more than one stated maturity for Term Bonds of a series, then into a
separate special account in the Sinking Fund for each such separate maturity of Term
Bonds. The funds and investments in each such separate account shall be applied to the
payment of principal of the Term Bonds of the series or maturity within a series for which
it is established. The Amortization Installments may be due either annually or semi-
annually, but in any event, the required payments as set forth above shall be made
monthly commencing in the first month which is six (6) months or twelve (12) months, as
the case may be, prior to the date on which the Amortization Installment is required to be
made pursuant to (c) above.
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Upon the sale of any series of Term Bonds, the City shall by resolution,
establish the amounts and maturities of such Amortization Installments for each series,
and if there shall be more than one maturity of Term Bonds within a series, the
Amortization Installments for the Term Bonds of each maturity.
Moneys on deposit in each of the separate special accounts in the Bond
Amortization Account shall be used for the open market purchase or the redemption of
Term Bonds of the series or maturity of Term Bonds within a series for which such
separate special account is established,
3) No Reserve Account shall be established for the Initial Bonds. Upon
issuance of any Additional Bonds, moneys remaining in the Revenue Fund shall next be
applied by the City to maintain a Reserve Account, which Reserve Account is hereby
created and established, in a sum equal to and sufficient to pay the Maximum Bond
Service Requirement on all outstanding Additional Bonds becoming due in any ensuing
Fiscal Year, all or a portion of which such sum may be initially provided from the
proceeds of the sale of the Additional Bonds and/or other moneys of the City. The City
shall thereafter deposit into said Reserve Account an amount equal to one-twelfth (1/12)
of twenty per cent (20%) of the difference between the amount, if any, so deposited upon
the delivery of the Additional Bonds and the amount of the Maximum Bond Service
Requirement on all outstanding Additional Bonds becoming due in any ensuing Fiscal Year.
No further payments shall be required to be made into such Reserve Account when there
has been deposited therein and as long as there shall remain on deposit therein a sum
equal to the Maximum Bond Service Requirement on all outstanding Additional Bonds
becoming due in any ensuing Fiscal Year.
Any withdrawals from the Reserve Account shall be subsequently restored
from the first moneys available in the Revenue Fund after all required current payments
LKL-05/14/85-183A-2034 17-
into the Sinking Fund and into the Reserve Account, including all deficiencies for prior
payments, have been made in full.
Moneys in the Reserve Account shall be used only for the purpose of the
payment of maturing principal (including Amortization Installments) of or interest on the
Additional-Bonds when the moneys in the Sinking Fund are insufficient therefor, and for
no other purpose. Upon the issuance by the City of any further Additional Bonds under
the terms, limitations and conditions provided in this Ordinance, the payments into the
Reserve Account shall be increased so that the amount on deposit therein shall be equal to
the Maximum Bond Service Requirement on all Additional Bonds outstanding and to be
outstanding.
Whenever the amount on deposit in the Reserve Account exceeds the
Maximum Bond Service Requirement on all Additional Bonds then outstanding, the excess
may be withdrawn and deposited into the Sinking Fund.
The City shall not be required to make any further payments into the Sinking
Fund or into the Reserve Account when the aggregate amount of moneys in the Sinking
Fund and the Reserve Account are at least equal to the aggregate principal amount of
Bonds then outstanding, plus the amount of interest then due or thereafter to become due
on the Bonds then outstanding.
Notwithstanding the foregoing provisions, in lieu of the required deposits of
Gross Revenues into the Reserve Account, the City may cause to be deposited into the
Reserve Account a surety bond or an insurance policy issued by a reputable and
recognized insurer for the benefit of the Bondholders in an amount equal to the difference
between the Maximum Bond Service Requirement and the sums then on deposit in the
Reserve Account, if any, which surety bond or insurance policy shall be payable (upon the
giving of notice as required thereunder) on any interest payment date on which a
deficiency exists which cannot be cured by funds in any other account held pursuant to
LKL-05/14/85-183A-2034 18-
this Ordinance and available for such purpose. The insurer providing such surety bond or
insurance policy shall be an insurer whose municipal bond insurance policies insuring 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
Corporation or Moody's Investors Service, Inc., or their successors or any insurer who
holds the highest policyholder rating accorded insurers by A.M. Best & Co. or any
comparable service. If a disbursement is made from a surety bond or an insurance policy
provided pursuant to this paragraph, the City shall be obligated to either reinstate the
maximum limits of such surety bond or insurance policy immediately following such
I H!
disbursement or to deposit into the Reserve Account, as herein provided in this paragraph
i
Reserve Account, funds in the amount of eforrestorationofwithdrawalsfromthe
disbursement made under such policy, or a combination of such alternatives.
4) The City shall next apply and deposit the moneys in the Revenue 11 'I
Fund into a special account to be known as the "Renewal and Replacement Fund", which
fund is hereby created. The City shall deposit into such Renewal and Replacement Fund
11
an amount equal to one-twelfth (1/12) of ten per centum (10%) of the Net Revenues of
theI ll
Buccaneer District System for the previous Fiscal Year, provided, that no deposit shall be
required whenever there shall be on deposit in the Fund at least $250,000. The moneys in
said Renewal and Replacement Fund shall be used only for the purpose of paying the cost
of the replacement of capital assets of the Buccaneer District System and emergency
repairs thereto. Such moneys on deposit in such Fund shall also be used to supplement the
Reserve Account if necessary in order to prevent a default in the payment of the principal
of and interest on the Bonds.
5) To the extent junior lien bonds are issued and outstanding ( which
subordinated bonds the City reserves the right to issue), the City shall next apply moneys
LKL-05/21/ 85-183A-2034 19-
f
in the Revenue Fund to the payment of principal of, redemption premium, if any, and
interest on such subordinated debt of the City.
6) The balance of any moneys remaining in the Revenue Fund after
the above required payments have been made may either be deposited into either the
Renewal and Replacement Fund or the Sinking Fund, or may be used for the purchase or
redemption of Bonds, or may be used by the City for any lawful purpose of the City.
C. INVESTMENT OF FUNDS. The Operation and Maintenance Fund, the
Sinking Fund, the Reserve Account, the Renewal and Replacement Fund, the Revenue
Fund, the Available Impact Fee Account, and any other special funds herein established
and created shall constitute trust funds for the purposes provided herein for such funds.
All such funds shall be continuously secured in the same manner as state and municipal
deposits are required to be secured by the laws of the State of Florida. Moneys on deposit
in any of such funds and accounts may be invested and reinvested in Authorized
Investments.
Investments made with moneys in the Revenue Fund, the Operation and
Maintenance Fund, the Sinking Fund (except the Bond Amortization Account therein), and
in the Available Impact Fee Account must mature not later than the date that such
moneys will be needed. Investments made with moneys in the accounts in the Bond
Amortization Account, in the Reserve Account and in the Renewal and Replacement Fund
must mature, in the case of the accounts in the Bond Amortization Account not later than
the stated date of maturity of the Term Bonds to be retired from the sub-accounts in the
Bond Amortization Account from which the investment is made, in the case of the
Reserve Account not later than the final maturity of any Bonds then outstanding; and in
the case of the Renewal and Replacement Fund, not later than such date as shall be
determined by the City. Any and all income received by the City from all such
investments shall be deposited into the Revenue Fund, except however, that investment
LKL-05/14/85-183A-2034 20-
income earned in the Bond Amortization Account may be retained thereon or deposited
into the Sinking Fund and used to pay maturing principal of and interest on the Bonds, at
the option of the City.
The cash required to be accounted for in each of the foregoing funds and
accounts established herein may be deposited in a single bank account, and funds allocated
to the various accounts established herein may be invested in a common investment pool,
provided that adequate accounting records are maintained to reflect and control the
restricted allocation of the cash on deposit therein and such investments for the various
purposes of such funds and accounts as herein provided.
The designation and establishment of the various funds in and by this
Ordinance shall not be construed to require the establishment of any completely
independent, self-balancing funds as such term is commonly defined and used in
governmental accounting, but rather is intended solely to constitute an earmarking of
certain revenues and assets of the Buccaneer District System for certain purposes and to
establish certain priorities for application of such revenues and assets as herein provided.
D. OPERATION AND MAINTENANCE. The City will maintain the
Buccaneer District System and all parts thereof in good condition and will operate the
same in an efficient and economical manner, making such expenditures for equipment and
for renewals, repairs and replacements as may be proper for the economical operation and
maintenance thereof.
E. RATE ORDINANCE. The City has enacted or will enact a rate
ordinance and thereby will fix, establish and maintain such rates and will collect such
fees, rentals and other charges for the services and facilities of the Buccaneer District
System and revise the same from time to time whenever necessary, as will always provide
Gross Revenues in each Fiscal Year sufficient to pay the Cost of Operation and
Maintenance of the Buccaneer District System in such Fiscal Year, one hundred ten per
LKL-05/14/85-183A-2034 21-
centum (110%) of the Bond Service Requirement becoming due in such Fiscal Year on the
outstanding Bonds, plus one hundred per centum (100%) of all reserve and other payments
required to be made pursuant to this Ordinance. Such rates, fees, rentals and other
charges shall not be reduced so as to be insufficient to provide Gross Revenues for such
purposes. However, nothing in this Ordinance shall ever require the City to raise rates or
charges for utility services provided to areas outside Buccaneer District.
F. BOOKS AND RECORDS. The City shall keep books and records of the
Buccaneer District System, which such books and records shall be kept separate and apart
from all other books, records and accounts of the City, and Bondholders shall have the
right at all reasonable times to inspect all records, accounts and data of the City relating
thereto.
G. ANNUAL AUDIT. The City shall also, at least once a year, cause the
books, records and accounts relating to the Buccaneer District System to be properly
audited by a recognized independent firm of certified public accountants and shall make
generally available the report of such audits to any Bondholder.
H. NO MORTGAGE OR SALE OF THE BUCCANEER DISTRICT
SYSTEM. The City irrevocably covenants, binds and obligates itself not to sell, lease,
encumber or in any manner dispose of the Buccaneer District System as a whole until all
of the Bonds shall have been paid in full as to both principal and interest, or payment shall
have been duly provided for under this Ordinance.
The foregoing provision notwithstanding, the City may sell or dispose of, for
fair market value, any properties or parts of the Buccaneer District System which the
Consulting Engineer shall certify in writing are not necessary for the continued operation
of the Buccaneer District System and that the sale or disposal of which will not adversely
affect the Gross Revenues to be derived from the Buccaneer District System to such an
LKL-05/14/85-183A-2034 22-
extent that the City will fail to comply with the covenants contained herein, including
Section 17(E) hereof.
The proceeds derived from any sale or disposal of any properties or parts of
the Buccaneer District System as provided for in the above paragraph shall, in the
discretion of the City, be (1) deposited in the Renewal and Replacement Fund and used
exclusively for the purpose of paying the cost of extensions, enlargements or additions to,
or the replacement of capital assets of the Buccaneer District System and for unusual or
extraordinary repairs thereto, or for the construction or acquisition of additions,
extensions and improvements to the Buccaneer District System, or (2) for the purchase or
retirement of the Bonds then outstanding. However, if the Consulting Engineer certifies
that proceeds are necessary for the purposes stated in part (1) above, such proceeds shall
remain in the Renewal and Replacement Fund until such certified requirements are
satisfied, and the proceeds shall not be used for any other purpose allowed by this
Ordinance.
I. INSURANCE. The City will make adequate provision to maintain fire
and windstorm insurance on all buildings and structures and properties of the Buccaneer
District System which are subject to loss through fire or windstorm, public liability
insurance, and other insurance of such types and in such amounts as are normally carried
in the operation of similar public and private utility systems within the State of Florida.
Any such insurance shall be placed with nationally recognized and reputable insurors or
under State approved and authorized self insurance programs or any combination of both
and shall be carried for the benefit of the Bondholders. All monies received for losses
under any such insurance, except public liability, are hereby pledged by the City as
security for the Bonds, until and unless such proceeds are used to remedy the loss or
damage for which such proceeds are received, either by repairing the property damaged or
LKL-05/14/85-183A-2034 23-
replacing the property destroyed within ninety (90) days from the receipt of such
t
proceeds.
J. NO FREE SERVICE. The City will not render or cause to be rendered
any free services of any nature, except for public emergency, by its Buccaneer District
System, nor will any preferential rates be established for users of the same class. This
covenant shall not prevent individual contracts with other governmental entities for the
wholesale delivery of services of the Buccaneer District System. The City, including its
departments, agencies and instrumentalities, shall avail itself of the facilities or services
provided by the Buccaneer District System for services within the Buccaneer District
System or any part thereof, and the same rates, fees or charges applicable to other
customers receiving like services under similar circumstances shall be charged to the City
and any such department, agency or instrumentality. Such charges shall be paid as they
accrue, and the City shall transfer from its general funds sufficient sums to pay such
charges. The revenues so received shall be deemed to be Gross Revenues derived from
the operation of the Buccaneer District System and shall be deposited and accounted for
in the same manner as other Gross Revenues derived from such operation of the
Buccaneer District System.
K. MANDATORY CONNECTION. To the full extent permitted by law the
City will adopt and keep in force and effect an ordinance requiring that all improved
premises with respect to which water or sewer services from the Buccaneer District
System are available shall connect such premises to the Buccaneer District System and
shall obtain available water and sewer services only from the Buccaneer District System.
L. ENFORCEMENT OF COLLECTIONS. The City will diligently enforce
and collect all fees, rentals or other charges for the services and facilities of the
Buccaneer District System and take all steps, actions and proceedings for the
enforcement and collection of such fees, rentals or other charges which shall become
LKL-05/14/85-183A-2034 24-
Jt
delinquent
to the full extent permitted or authorized by the Act and by the laws of the
state of Florida.
The City will, under reasonable rules and regulations, shut off and discontinue
he pupplying of the water service and the sewer service of the Buccaneer District System
the non-payment of fees, rentals or other charges for said water service or said sewerdor
or either of them, and will not restore said water service or sewer service, or
Novice,
either
of them, until all delinquent charges for both water service and sewer service,
together with interest and reasonable penalties, have been paid in full.
M. REMEDIES. (1) It shall be an "Event of Default" under this Ordinance if
ony of the following shall occur:
a) As to the Initial Bonds, if Net Revenues or Available Impact Fes
ere available at such time under the terms of this Ordinance, failure by the City to pay
Mny
portion of principal of or interest on the Initial Bonds, when due, from such Net
tt, venues or Available Impact Fees;
b) As to the Initial Bonds, if Net Revenues or Available Impact Fees
re not available to pay any portion of principal of or interest on the Bonds when due,
N1lure by the City to pay such unpaid portion of principal of or interest on the Initial
tkonckt on the earlier of: (i) the first date that sufficient Net Revenues or Available
impact Fees are available for such purpose under the terms of this Ordinance, or (ii) one
ro after the last stated date of maturity of any of the principal amount of the Initial
t &
c) As to all Bonds except the Initial Bonds, failure to pay any portion
a the principal of or interest on the Bonds (other than the Initial Bonds) when due;
d) Failure by the City to comply with any of the covenants and terms
gs, this Ordinance made for the benefit of the Bondholders (other than as described in
a-4/14/85-183A-2034 25-
paragraphs (a), (b) or (c) above) for a period of 60 days after written notice of such failure
shall have been given to the City by one or more of the Bondholders;
e) There shall occur the filing by the City of a voluntary petition in
bankruptcy, or the commission by the City of any act of bankruptcy, or the adjudication
of the City as a bankrupcy, or the assignment by the City for the benefit of its creditors,
or the entry by the City into an agreement of composition with its creditors, or the
approval by a court of competent jurisdiction of a petition applicable to the City in any
proceeding for its, reorganization, instituted under the provisions of the Federal
Bankruptcy Act, as amended, or any similar act in any jurisdiction which may now be in
effect or hereinafter amended; or
f) An order or decree shall be entered, with the consentor
acquiescence of the City, appointing a receiver or receivers of the Buccaneer District
System, or any part thereof, or of the rents, fees, charges or other revenues therefrom, or
if such order or decree, having been entered without the consent of acquiescence of the
City, shall not be vacated or discharged or stayed within 90 days after the entry thereof.
2) Upon the occurrence of any Event of Default, any Bondholder, or any
trustee acting for the Bondholders, may, either at law or in equity, by suit, action,
mandamus or other proceedingsā¢ in any court of competent jurisdiction, protect and
enforce any and all rights, including the right to the appointment of a receiver, existing
under the laws of the State of Florida, or granted and contained herein, and may enforce p '!
and compel the performance of all duties herein required or by any applicable statutes to
be performed by the City or by any officer thereof.
3) Nothing herein, however, shall be construed to grant to any Bondholders
any lien on any real property of the City.
N. CONSULTING ENGINEERS. The City will retain an independent
consulting engineer or engineering firm having a favorable reputation for skill and
LKL-05/14/85-183A-2034 26-
1
experience for the design, construction and operation of systems of comparable size and
character as the Buccaneer District System, for the purpose of providing the City
competent engineering counsel in connection with the making of the capital
improvements. The City may, however, employ additional engineers at any time with
relation to specific engineering and operation problems arising in connection with the
Buccaneer District System.
4.
O. CITY MANAGER REPORTS. On an annual basis, within 45 days of the
receipt of the annual audit of the Buccaneer District System provided for above, the City
shall cause to be prepared by the City Manager a report or survey of the Buccaneer
District System with respect to the management of the properties thereof, the sufficiency
of the rates and charges for services, the proper maintenance of the properties of the
Buccaneer District System and the necessity for capital improvements and
recommendations therefor. Such a report or survey shall also show any failure of the City
to perform or comply with the covenants herein contained, including those contained in
subsection I above.
In the event that such annual report reflects that the rates and charges for
services are insufficient to protect the rights of the Bondholders, then the City shall take
such steps as are required by law to raise the rates and charges for services pursuant to
Section 17E hereof.
P. NO COMPETING SYSTEM. To the full extent permitted by law the City
will not grant or cause, consent to, or allow the granting of any franchise or permit to any
person, firm, corporation or body or agency or instrumentality whatsoever for the
furnishing of water or sanitary sewerage services to or within the service area of the
Buccaneer District System, if determined by the Consulting Engineers: (i) to be
materially competitive with the Buccaneer District System, and (ii) to adversely affect
the Net Revenues or Available Impact Fees derived from the operation thereof.
LKL-05/ 14/85-183A-2034 27-
Q. ISSUANCE OF OTHER OBLIGATIONS. The City will not issue any
other obligations, except under the conditions and in the manner provided herein, payable
from the Net Revenues or Available Impact Fees, nor voluntarily create or cause to be
created any debt, lien, pledge, assignment, encumbrance or other charge having priority
to or being on a parity with the lien of the Initial Bonds and the interest thereon upon the
Net Revenues or Available Impact Fees. Any other obligations issued by the City in
addition to the Initial Bonds or Additional Bonds provided for in subsection R below,
payable from the Net Revenues or Available Impact Fees shall contain an express
statement that such obligations are junior and subordinate in all respects to the Bonds as
to lien on and source and security for payment from the Net Revenues and Available
Impact Fees.
R. ISSUANCE OF ADDITIONAL BONDS. Additional Bonds, payable on a
parity from the Net Revenues and Available Impact Fees with the Initial Bonds, shall be
issued only for the purposes of refunding a part of the outstanding Bonds or financing the
cost of a Project. Additional Bonds, other than for refunding purposes, shall be issued
only upon compliance with all of the following conditions:
1) There shall have been obtained and filed with the City Clerk of the City
a certificate of a qualified and recognized firm of independent certified public
accountants stating: (a) that the books and records of the City relative to the System
have been audited by such firm; (b) the amount of the Net Revenues derived for the Fiscal
Year preceding the date of issuance of the proposed Additional Bonds or for any 12
consecutive months during the 18 months immediately preceding the date of the issuance
of the Additional Bonds with respect to which such certificate is made, adjusted as herein
below provided; (c) that the aggregate amount of such Net Revenues, as adjusted, for the
period for which such Net Revenues are being certified is equal to not less than 125% of
the Maximum Bond Service Requirement becoming due in any Fiscal Year thereafter on (i)
LKL-05/14/85-183A-2034 28-
all Bonds then outstanding, and (ii) on the Additional Bonds with respect to which such
certificate is made.
2) Upon recommendation of the Consulting Engineers, the Net Revenues
certified pursuant to (b) in the previous paragraph may be adjusted for purposes of this
Subsection by including: (a) 100% of the additional Net Revenues which in the opinion of
the Consulting Engineer would have been derived by the City from rate increases adopted
before the Additional Bonds are issued, if such rate increases had been implemented
before the commencement of the period for which such Net Revenues are being certified,
and (b) 100% of the additional Net Revenues estimated by the Consulting Engineer to be
derived during the first full twelve month period after the date of placing in service the
Project financed with the proceeds of the Additional Bonds with respect to which such
certificate is made. The adjustments described in Section 17(R)(2)(b) may only be made if
the Net Revenues as adjusted under Section 17(R)(2)(a) for the period for which such Net
Revenues are being certified equals at least 1.00 times the Maximum Bond Service
Requirement becoming due in any Fiscal Year thereafter on (i) all Bonds then outstanding,
and (ii) on the Additional Bonds with respect to which such certificate is made.
3) Each ordinance or resolution authorizing the issuance of Additional
Bonds will recite that all of the covenants herein contained will be applicable to such
Additional Bonds.
4) The City shall not be in default in performing any of the covenants and
obligations assumed hereunder, and all payments herein required to have been made into
the accounts and funds, as provided hereunder, shall have been made to the full extent
required.
S. MAINTENANCE OF THE SYSTEM. The City will acquire the Utility
System simultaneously with issuance of the Initial Bonds. Thereafter, the City will
LKL-05/14/85-183A-2034 29-
t_m
rr.l
maintain the Buccaneer District System in good condition and continuously operate the
same in an efficient manner and at a reasonable cost.
T. IMPACT FEES.
1) The City shall deposit all Impact Fees, promptly upon receipt, into y,
the "Buccaneer District Water and Sewer System Impact Fee Fund (hereinafter called the
Impact Fee Fund"), hereby created and established. The Impact Fee Fund shall I+
constitute a trust fund for the purposes herein provided and shall be kept separate and
distinct from all other funds of the City and used only for the purposes and in the manner
herein provided. That portion of the Impact Fees constituting Available Impact Fees shall
be held in a separate account in the Impact Fee Fund, designated the "Available Impact
Fee Account," and the balance of the Impact Fees shall be held in a separate account in
the Impact Fee Fund, designated the "General Impact Fee Account"
2) The moneys in the General Impact Fee Account shall be invested,
held, and used, without restriction under this Ordinance, in accordance with law and the
direction from time to time of the City Commission.
3) The moneys in the Available Impact Fee Account shall be held in I
such Account upon receipt until one day after the latest principal maturity date on any 1
Bonds outstanding, coming due in each Fiscal Year, and, during such period, shall be used
only to make the payments described in Section 17B (2) or (3) or (5) of this Ordinance to
the extent that Net Revenues are insufficient for such purpose. After such period, the I 1
balance, if any, collected during such period and remaining in the Available Impact Fee
i '!
is
Account may, at the option of the City, be held therein, be used to reimburse the City for
i
payments made from other sources under Section 17B (2), ( 3) or (5) of this Ordinance
which could have been made from Available Impact Fees, or be transferred to the General
LImpact
Fee Account.
LKL-05/14/85-183A-2034 30-
9
Ii
Section 18. ARBITRAGE. The City at all times while the Bonds are
outstanding will comply with the requirements of Section 103(c) of the Internal Revenue
Code of 1954 and any valid and applicable rules and regulations promulgated thereunder.
Section 19. MODIFICATION OR AMENDMENT. No material modifi-
cation or amendment of this Ordinance or of any ordinance or resolution amendatory
hereof or supplemental hereto may be made without the consent in writing of (i) the
insuror under any insurance policy of the City then in force which insures against non-
payment of princi l of and redemption premium, if applicable, and interest on, the
Bonds, and (ii) the Registered Owners of two-thirds or more in the principal amount of the
Bonds then outstanding; providing, however, that no modification or amendment shall
permit a change in the maturity of the Bonds or reduction in the rate of interest thereont
or in the amount of the principal obligation thereof or affecting the promise of the City
to pay the principal of and interest on the Bonds as the same shall become due from the
Net Revenues or Available Impact Fees or reduce the percentage of Registered Owners
required to consent to any material modification or amendment hereof without the
consent in writing of any insuror and of all Registered Owners.
Section 20. DEFEASANCE AND SUBROGATION. (a) If, at any time, the
City shall have paid, or shall have made provision for payment of, the principal, interest
and redemption premiums, if any, with respect to the Bonds, then, and in that event, the a
pledge of and lien on the Net Revenues and Available Impact Fees and all covenants
herein in favor of the Bondholders shall be no longer in effect. For purposes of the
preceding sentence, deposit of Federal Securities or bank certificates of deposit fully
secured as to principal and interest by Federal Securities (or deposit of any other
securities or investments which may be authorized by law from time to time and
sufficient under such law to effect such a defeasance) in irrevocable trust with a banking
institution or trust company, for the sole benefit of the Bondholders, in respect to which
LKL-05/14/85-183A-2034 31-
such Federal Securities or certificates of deposit, the principal and interest received will
be sufficient to make timely payment of the principal of, interest on, redemption
premiums, if any, expenses and any other obligations of the City incurred with respect to
the outstanding Bonds, shall be considered "provision for payment". Nothing herein shall
be deemed to require the City to call any of the outstanding Bonds for redemption prior to
maturity pursuant to any applicable optional redemption provisions, or to impair the
discretion of the City in determining whether to exercise any such option for early
redemption.
b) In the event any of the principal and redemption premium, if applicable,
and interest due on the Bonds shall be paid by an insuror pursuant to an insurance policy
which insures against non-payment thereof, the pledge of the Net Revenues and Available
Impact Fees and all covenants, agreements and other obligations of the City to the
Registered Owners to whom or for the benefit of whom the insuror has made such
payments, shall continue to exist and the insuror shall be subrogated to the rights of such
Registered Owners to the full extent of such payments.
Section 21. SEVERABILITY OF INVALID PROVISIONS. If any one or
more of the covenants, agreements or provisions herein contained shall be held contrary
to any express provisions of law or contrary to the policy of express law, though not
expressly prohibited, or against public policy, or shall for any reason whatsoever be held
invalid, then such covenants, agreements or provisions shall be null and void and shall be
deemed separable from the remaining covenants, agreements or provisions and shall in no
way affect the validity of any of the other provisions hereof or of the Bonds issued
hereunder.
LKL-05/14/85-183A-2034 32-
Section 22. Effective Date. This ordinance shall become effective in
the manner required by law.
Passed on First Reading 'r/aftd, ,2 S 1985.
Passed on Final Reading 1985.
Approved as to form and correctness:
City ttorney
ayor/Pre iding Officer
Attest:
acgt,44...;ev id? ti,(Adea-t___,
City Clerk
kk
CERTIFICATION
I certify this to be a true and correct
copy of the record in my offico.
WITNESSETH my hand and cliiciat seal
of the City of Atlantic Beach. Flcrida.,
this the./
Yi.
day of
19,
a ty Clerk
LKL-05/14/85-183A-2034 33-