Resolution 13-02 Exhibit C. Bond Purchase Agreement v City of Atlantic Beach, Florida
Health Care Facilities Revenue and Refunding Bonds
(Fleet Landing Project),
Series 2013A
March 5, 2013
Bond Purchase Agreement
City of Atlantic Beach, Florida
Atlantic Beach, Florida
Naval Continuing Care Retirement
Foundation, Inc.
Atlantic Beach, Florida
To the Addressees:
The undersigned, B.C. Ziegler and Company (the "Underwriter"), being duly
authorized, hereby offers to enter into this Bond Purchase Agreement (this "Purchase
Agreement") with the City of Atlantic Beach, Florida (the "Issuer") and Naval
Continuing Care Retirement Foundation, Inc. (the "Obligor"), for the purchase by the
Underwriter and the sale by the Issuer of the Bonds referred to in Section 1 hereof. This
offer is made subject to acceptance by the Issuer and the Obligor of this Purchase
Agreement, which acceptance shall be evidenced by the execution of this Purchase
Agreement by duly authorized officers of the respective parties prior to 5:00 P.M.,
Eastern Daylight Time on March 5, 2013. Upon such acceptance, execution and
delivery, this Purchase Agreement shall be in full force and effect in accordance with its
terms and shall be binding upon the Issuer, the Obligor and the Underwriter. Capitalized
terms used herein, but not otherwise defined herein, shall have the meanings assigned to
them in the Indenture (as defined below) or in the Official Statement referred to in
Section 2 hereof.
1. Purchase and Sale. Upon the terms and conditions and based on the
representations, warranties and covenants hereinafter set forth, the Underwriter hereby
agrees to purchase from the Issuer, and the Issuer hereby agrees to sell to the
Underwriter, all (but not less than all) of $40,050,000 in aggregate principal amount of
City of Atlantic Beach, Florida Health Care Facilities Revenue and Refunding Bonds
(Fleet Landing Project), Series 2013A (the "Bonds"), at the purchase price of
$42,202,108.05 (which represents the par amount of the Bonds less underwriter's
discount of$512,152.50 plus original issue premium of$2,664,260.55).
2. Authorizing Instruments. The Bonds shall be as described in, and shall be
authorized by a resolution adopted by the Issuer on February 11, 2013 (the "Resolution").
The Bonds shall be issued and secured under and pursuant to an Indenture of Trust dated
as of April 1, 2013 (the "Indenture"), between the Issuer and U.S. Bank National
Association, as bond trustee (in such capacity, the "Bond Trustee"), and shall be payable
from the Trust Estate (as defined in the Indenture), including the revenues derived by the
Issuer under a Loan Agreement dated as of April 1, 2013 (the "Agreement"), between the
Issuer and the Obligor. The Obligor will evidence its obligations with respect to the
Bonds by issuing a Series 2013A Note relating to the Bonds (the "Note") pursuant to
Supplemental Master Trust Indenture No. 1 dated as of April 1, 2013 (the "Supplement")
to the Master Trust Indenture dated as of April 1, 2013 (the "Master Indenture"), each
between the Obligor and U.S. Bank National Association, as master trustee (the "Master
Trustee").
Notes issued under the Master Indenture are secured by a security interest in
certain revenues of the Obligor and by a Mortgage and Security Agreement dated as of
April 1, 2013, between the Obligor and the Master Trustee, relating to certain property of
the Obligor (the "Mortgage").
The Bonds shall be dated their date of delivery (the "Closing Date"), and shall
have the terms specified in the Preliminary Official Statement dated February 12, 2013,
as supplemented by a Supplement to Preliminary Official Statement dated March 1, 2013
(collectively, the "Preliminary Official Statement") and the Final Official Statement dated
March 5, 2013 (the Final Official Statement"), including the maturities and interest rates
set forth in Exhibit A annexed hereto. The Bonds shall be subject to optional and
mandatory sinking fund redemption as described in Exhibit B hereto and otherwise as set
forth in the Indenture.
3. Public Offering of Bonds. The Underwriter agrees to make a bona fide
public offering of the Bonds, solely pursuant to the Preliminary Official Statement and
the Final Official Statement at the initial offering prices set forth on the inside cover page
of the Final Official Statement, reserving, however, the rights to (i) change such initial
offering prices as the Underwriter shall deem necessary in connection with the marketing
of the Bonds and (ii) offer and sell the Bonds to certain dealers (including dealers
depositing the Bonds into investment trusts) at concessions to be determined by the
Underwriter. The Underwriter also reserves the right to over-allot or effect transactions
that stabilize or maintain the market prices of the Bonds at levels above that which might
otherwise prevail in the open market and to discontinue such stabilizing, if commenced,
at any time.
The Issuer and the Obligor acknowledge and agree that (i) the purchase and sale of
the Bonds pursuant to this Purchase Agreement is an arm's-length commercial transaction
between the Issuer and the Underwriter; (ii) in connection with such transaction, the
Underwriter is acting solely as a principal and not as an agent or fiduciary of the Issuer or
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the Obligor; (iii) the Underwriter has not assumed a fiduciary responsibility in favor of
the Issuer or the Obligor with respect to the offering of the Bonds or the process leading
thereto (whether or not the Underwriter, or any affiliate of the Underwriter, has advised
or is currently advising the Issuer or the Obligor on other matters) nor has it assumed any
other obligation to the Issuer or the Obligor except the obligations expressly set forth in
this Purchase Agreement; (iv) the Underwriter has financial and other interests that differ
from those of the Issuer and the Obligor; and (v) the Issuer and the Corporation have
consulted with their own legal and financial advisors to the extent they deemed
appropriate in connection with the offering of the Bonds.
4. Use of Proceeds. The proceeds to be received by the Issuer from the sale of
the Bonds will be loaned to the Obligor pursuant to the Agreement for the purpose of
(i) currently refunding all of the Issuer's outstanding Health Care Facilities Revenue
Refunding Bonds (Fleet Landing Project), Series 1999 and Variable Rate Demand Health
Care Facilities Revenue Bonds (Fleet Landing Project), Series 2006 (the "Refunded
Bonds"), (ii) financing the cost of the acquisition of approximately 2 acres of land
contiguous to the Obligor's existing campus known as Fleet Landing in the City of
Atlantic Beach, Florida (the "Community"), (iii) fund a debt service reserve fund to
secure the Bonds, and (iv) pay the costs of issuance of the Bonds.
5. Preliminary and Final Official Statements.
(a) The Obligor has caused to be prepared, and the Issuer and the
Obligor hereby confirm that they have heretofore made available to the
Underwriter the Preliminary Official Statement. The Obligor agrees to deliver to
the Underwriter, at such address as the Underwriter shall specify, as many copies
of the Final Official Statement as the Underwriter shall reasonably request as
necessary to comply with paragraph (b)(4) of Rule 15c2-12 of the Securities and
Exchange Commission (the "Rule") under the Securities Exchange Act of 1934, as
amended, (the "1934 Act") and with Rule G-32 and all other applicable rules of
the Municipal Securities Rulemaking Board. The Obligor agrees to deliver such
Final Official Statement within seven business days after the execution hereof
The Issuer is not undertaking any responsibility for the accuracy or completeness
of any of the information in the Preliminary Official Statement or the Final
Official Statement except for the information contained under the captions "THE
ISSUER" and "LITIGATION—Issuer."
(b) The Issuer and the Obligor by their acceptance hereof, ratify and
approve the Preliminary Official Statement as of its date and authorize and
approve the Final Official Statement (the Final Official Statement and any
amendments or supplements that may be authorized for use with respect to the
Bonds are herein referred to collectively as the "Official Statement"), consent to
their distribution and use by the Underwriter and authorize the execution of the
Final Official Statement by duly authorized officers of the Obligor. The Obligor
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agrees to obtain the approval in writing of Moore Stephens Lovelace, P.A. to use
its report in Appendix B of the Preliminary and Final Official Statements.
(c) The Underwriter shall give notice to the Issuer and the Obligor on
the date after which no participating underwriter, as such term is defined in the
Rule, remains obligated to deliver Final Official Statements pursuant to paragraph
(b)(4) of the Rule.
6. Disclosure. As of the date hereof, the Underwriter has filed with the Issuer
a disclosure and truth-in-bonding statement pursuant to Section 218.385, Florida Statutes,
as amended.
7. Agreed Upon Procedures and Auditor Consents.
(a) On or prior to the date of delivery of the Preliminary Official
Statement, there has been delivered to the Underwriter (i) a letter of Moore
Stephens Lovelace, P.A. dated the date of the Preliminary Official Statement, with
agreed upon procedures performed to a date not more than five (5) business days
prior to the date thereof in substantially the form attached as Appendix C hereto
("Agreed Upon Procedures Letter") and (ii) a letter from Moore Stephens
Lovelace, P.A. consenting to the inclusion of their report on the Obligor's audited
financial statements and to references to them under the heading
"INDEPENDENT AUDITORS" in the Preliminary Official Statement.
(b) At least three (3) business days prior to the printing of the Final
Official Statement there shall be delivered to the Underwriter (i) a letter of Moore
Stephens Lovelace, P.A., to the effect that such accountants reaffirm, the
statements made given in the Agreed Upon Procedures Letter and (ii) a letter from
Moore Stephens Lovelace, P.A. consenting to the inclusion of their report on the
Obligor's audited financial statements and to references to them under the heading
"INDEPENDENT AUDITORS" in the Final Official Statement.
8. Representations, Warranties and Covenants of the Issuer. The Issuer
hereby represents, warrants and covenants to the Underwriter as follows:
(a) The Issuer is a municipal corporation and a political subdivision of
the State of Florida.
(b) The Issuer is authorized under the laws of the State of Florida (i) to
issue the Bonds for the purposes described in Section 4 hereof; (ii)to pledge the
Trust Estate to the Bond Trustee under and pursuant to the Indenture, for the
benefit of the owners of the Bonds; (iii)to execute and deliver this Purchase
Agreement, the Bonds, the Indenture and the Agreement; and (iv) to carry out and
consummate all of the transactions contemplated on its part by this Purchase
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Agreement, the Resolution, the Bonds, the Indenture, the Agreement, and the
Preliminary and Final Official Statements (collectively, the "Issuer Documents").
(c) The information relating to the Issuer under the captions "THE
ISSUER" and "LITIGATION—Issuer" contained in the Preliminary Official
Statement is, and as of the date of closing such information in the Final Official
Statement will be, true and correct in all material respects, and the Preliminary
Official Statement does not and the Final Official Statement will not contain any
untrue or misleading statement of a material fact relating to the Issuer or omit to
state any material fact relating to the Issuer necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. It is understood and agreed to by the parties hereto that the Issuer's
representations with respect to the information contained in the Preliminary
Official Statement and Final Official Statement is limited to the information
contained under the captions "THE ISSUER" and "LITIGATION—Issuer."
(d) If, at any time prior to the earlier of (i) receipt of notice from the
Underwriter pursuant to Section 5(c) hereof that the Final Official Statement is no
longer required to be delivered under the Rule or(ii) 90 days after the Closing, any
event occurs with respect to the Issuer as a result of which the Preliminary Official
Statement or the Final Official Statement as then amended or supplemented might
include an untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, the Issuer shall promptly notify the
Underwriter in writing of such event. Any information supplied by the Issuer for
inclusion in any amendments or supplements to the Preliminary Official Statement
or Final Official Statement will not contain any untrue or misleading statement of
a material fact relating to the Issuer or omit to state any material fact relating to the
Issuer necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(e) The Issuer has duly adopted the Resolution and has duly authorized
all actions required to be taken by it for (i) the issuance and sale of the Bonds upon
the terms set forth herein and in the Indenture; (ii) the execution, delivery and due
performance of this Purchase Agreement, the Bonds, the Indenture and the
Agreement; and (iii)the delivery of the Preliminary and Final Official Statements,
and any and all such other agreements and documents as may be required to be
executed, delivered, or performed by the Issuer in order to carry out, give effect to
and consummate the transactions contemplated on its part hereby and by each of
the aforesaid documents.
(f) Except as may be described in the Preliminary and Final Official
Statements, there is no action, suit, proceeding, inquiry or investigation, at law or
in equity, before or by any court, public board or body, pending or, to the
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knowledge of the Issuer, threatened against or affecting the Issuer (or, to the
knowledge of the Issuer, any meritorious basis therefor) (i) attempting to limit,
enjoin or otherwise restrict or prevent the Issuer from functioning or contesting or
questioning the existence of the Issuer or the titles of the present officers of the
Issuer to their offices or (ii) wherein an unfavorable decision, ruling or finding
would (A) adversely affect the existence or powers of the Issuer or the validity or
enforceability of the Bonds, the Indenture, the Agreement, the this Purchase
Agreement or any agreement or instrument to which the Issuer is a party and
which is used or contemplated for use in the consummation of the transactions
contemplated hereby including, without limitation, the Issuer Documents or by the
aforesaid documents; or (B) materially adversely affect (i)the transactions
contemplated by the Issuer Documents; or (ii) the exclusion of the interest on the
Bonds from federal income taxation.
(g) The adoption by the Issuer of the Resolution and the execution and
delivery by the Issuer of this Purchase Agreement, the Bonds, the Indenture, the
Agreement and the other documents contemplated hereby and by the Preliminary
and Final Official Statements, and the compliance with the provisions thereof, will
not conflict with or constitute on the part of the Issuer a violation of, breach of or
default under (i) any constitutional provision, statute, indenture, mortgage, lease,
resolution, note, agreement or other agreement or instrument to which the Issuer is
a party or by which the Issuer is bound; or (ii) any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Issuer or any of
its properties.
(h) The Issuer is not in breach of or in default under the Resolution, the
Indenture, the Agreement, any applicable law or administrative regulation of the
State of Florida or the United States of America, or any applicable judgment or
decree, or any loan agreement, note, resolution or other agreement or instrument to
which the Issuer is a party or is otherwise subject, which breach or default would
in any way materially adversely affect the authorization or issuance of the Bonds
and the transactions contemplated hereby, and no event has occurred and is
continuing which, with the passage of time or the giving of notice or both, would
constitute such a breach or default.
(i) All consents, approvals, authorizations and orders of governmental
or regulatory authorities, if any, that are required to be obtained by the Issuer in
connection with the issuance and sale of the Bonds, the execution and delivery of
this Purchase Agreement, and the consummation of the transactions contemplated
by this Purchase Agreement, the Resolution, the Indenture, the Agreement, and the
Preliminary and Final Official Statements have been duly obtained and remain in
full force and effect, except that no representation is made as to compliance with
any applicable state securities or "Blue Sky" laws.
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(j) Neither the Issuer nor anyone acting on its behalf has, directly or
indirectly, offered the Bonds or any similar securities of the Issuer relating in any
way to any related project or facility or to the Obligor for sale to, or solicited any
offer to buy the same from, anyone other than the Underwriter.
(k) The Preliminary and Final Official Statements have been duly
authorized by the Issuer, and the Issuer has consented to the use of the Preliminary
and Final Official Statements by the Underwriter in connection with the offering
of the Bonds.
(1) Neither the Securities and Exchange Commission nor any state
securities commission has issued or, to the best of the Issuer's knowledge,
threatened to issue, any order preventing or suspending the use of the Preliminary
Official Statement or of the Final Official Statement.
(m) Any certificate signed by an authorized officer of the Issuer
delivered to the Underwriter shall be deemed a representation and warranty by the
Issuer to the Underwriter as to the statements made therein.
(n) The Issuer, as a conduit issuer, issues its bonds as limited obligations
of the Issuer, payable solely from payments to be made by the respective non-
governmental entities which use or own the projects financed. Some bonds issued
by the Issuer may have been, and may continue to be, in default, but to the best
knowledge of the Issuer, the borrowers under the related loan or lease agreements
are unrelated to the Obligor and other Members of the Obligated Group, if any.
To the best knowledge of the Issuer, the Issuer has not been in default as to
principal or interest at any time after December 31, 1975, as to any debt
obligations relating to the Obligor or any other member of the Obligated Group.
(o) This Purchase Agreement, the Indenture and the Agreement are in
the forms approved by the Issuer and upon the execution and delivery thereof by
the Issuer and the other parties thereto, each will constitute the legal, valid and
binding obligation of the Issuer, enforceable in accordance with its terms (subject
in each case to principles of equity, regardless of whether proceedings for
enforcement be of a legal or equitable nature, and to any applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting the enforcement of
creditors' rights generally from time to time in effect).
(p) The Bonds will be duly authorized, executed, authenticated, issued
and delivered and will constitute legal, valid and binding obligations of the Issuer
and are entitled to the benefits and security of the Indenture (subject to principles
of equity, regardless of whether proceedings for enforcement be of a legal or
equitable nature, and any applicable bankruptcy, reorganization, insolvency,
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moratorium or other laws affecting the enforcement of creditors' rights generally
from time to time in effect).
(q) The Bonds will be limited obligations of the Issuer, payable from
and secured by the Trust Estate, including the moneys derived by the Issuer from
the Obligor pursuant to the Agreement, and will not constitute an obligation or
debt of the Issuer, or the State of Florida, or any political subdivision thereof, and
neither the faith nor credit of the Issuer, or the State of Florida, or any political
subdivision thereof, is pledged to the payment of the Bonds.
(r) The Issuer has not been advised by the Commissioner, any District
Director, or any other official of the Internal Revenue Service that certifications by
the Issuer with respect to arbitrage may not be relied upon.
(s) The Issuer has and will cooperate with any reasonable request of the
Underwriter and its counsel in any endeavor to qualify the Bonds for offering and
sale under the securities or "Blue Sky" laws of such jurisdictions of the United
States of America as the Underwriter may request; provided, however, that the
Issuer will not be required to pay any expenses or costs (including but not limited
to legal fees) incurred in connection with such qualification or to qualify as a
foreign corporation or to file any general or special consent to service of process
under the laws of any state or other jurisdictions of the United States.
9. Representations, Warranties and Covenants of the Obligor. In order to
induce the Underwriter and the Issuer to enter into this Purchase Agreement and in order
to induce the Issuer to enter into the Agreement and this Purchase Agreement, the
Obligor represents, warrants and covenants to the Underwriter and the Issuer as follows:
(a) The Obligor is a not for profit corporation duly organized, validly
existing and in good standing under the laws of the State of Florida and is
qualified to transact business as a corporation in good standing under the laws of
the State of Florida.
(b) The Obligor is authorized under the laws of the State of Florida to
carry out and consummate all of the transactions contemplated on its part by this
Purchase Agreement, the Agreement, the Master Indenture, the Note, the
Supplement, the Continuing Disclosure Certificate dated as of April 1, 2013 (the
"Continuing Disclosure Certificate") from the Obligor, as representative of the
Obligated Group, the Mortgage, the Preliminary Official Statement and the Final
Official Statement (collectively, the "Obligor Documents").
(c) The Obligor has been determined to be and is exempt from federal
income taxes under Section 501(a) of the Internal Revenue Code of 1986, as
amended (the "Code") by virtue of being an organization described in Section
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501(c)(3) of the Code, is not a "private foundation" as defined in Section 509(a) of
the Code and is exempt from federal income taxation under Section 501(a) of the
Code, with the exception of any taxation deemed to be unrelated business taxable
income and with the exception of any amounts deemed taxable by virtue of
Section 527(f) of the Code. The Obligor (i) has not impaired its status as an
organization exempt from federal income taxes under the Code, (ii) is in
compliance with the provisions of the Code and any applicable regulations
thereunder necessary to maintain such status, (iii) is organized and operated
exclusively for charitable, educational or benevolent purposes and not for
pecuniary profit, and (iv) is organized and operated such that no part of the net
earnings of the Obligor will inure to the benefit of any private shareholder or
individual.
(d) The Obligor (i) agrees to file annual returns of an exempt
organization on Form 990 for each fiscal year as required by law; and (ii) is not
currently and does not expect to be the subject of any claim by the IRS that its
operations or activities constitute a trade or business that, within the meaning of
Section 513 of the Code, is unrelated to senior living and health care purposes for
which the Obligor is organized and operated.
(e) The Obligor has all necessary corporate power and authority (i) to
conduct its business and operate all of its properties and facilities, including the
Community; (ii)to execute and deliver the Obligor Documents and to perform its
obligations under the Obligor Documents; and (iii)to carry out and consummate
all the transactions contemplated on its part by the Obligor Documents.
(f) The information relating to the Obligor and its properties contained
in the Preliminary Official Statement is, and as of the date of closing such
information in the Final Official Statement will be, true and correct in all material
respects, and the Preliminary Official Statement does not and the Final Official
Statement will not contain any untrue or misleading statement of a material fact
relating to the Obligor or omit to state any material fact relating to the Obligor
necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(g) The Obligor has duly authorized all actions required to be taken by it
for the execution and delivery of the Obligor Documents, and due performance of
the Obligor Documents.
(h) The Agreement, the Master Indenture, the Note, the Supplement, the
Continuing Disclosure Certificate, the Mortgage and this Purchase Agreement are
in the forms approved or otherwise authorized by the Obligor and upon the
execution and delivery thereof, each will constitute the valid and legally binding
obligation of the Obligor, enforceable in accordance with its terms (subject in each
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case to usual principles of equity and to any applicable bankruptcy, reorganization,
insolvency, moratorium or other laws affecting the enforcement of creditors'
rights generally from time to time in effect).
(i) The Obligor will apply the moneys loaned by the Issuer from the
proceeds of the sale of the Bonds as specified in the Indenture, the Agreement, the
Preliminary and Final Official Statements and this Purchase Agreement.
(j) Except as described in the Preliminary and Final Official Statements,
there is no action, suit, proceeding, inquiry or investigation, at law or in equity,
before or by any court, public board or body, pending (as to which the Obligor has
received notice or service of process) or, to the knowledge of the Obligor,
threatened against or affecting any Obligated Group Member (or, to the
knowledge of the Obligor, any meritorious basis therefor) (i) attempting to limit,
enjoin or otherwise restrict or prevent any Obligated Group Member from
functioning, or contesting or questioning the existence of the Obligor or the titles
of the current officers of any of the Obligated Group Members to their offices or
(ii) wherein an unfavorable decision, ruling or finding would adversely affect
(A) the existence or powers of the Obligated Group Members; (B)the financial
position of the Obligated Group Members; (C) the tax-exempt status of the
Obligated Group Members under Sections 501(a) and 501(c)(3) of the Code;
(D)the transactions contemplated hereby or by the documents referred to in
(E) immediately below; (E) the validity or enforceability of the Bonds, the
Indenture, the Agreement, the Master Indenture, the Note, the Supplement, this
Purchase Agreement, the Continuing Disclosure Certificate, the Mortgage or any
agreement or instrument to which any of the Obligated Group Members is a party
and which is used or contemplated for use in the consummation of the transactions
contemplated hereby or by the aforesaid documents; or (F) the exclusion of the
interest on the Bonds from gross income for purposes of federal income taxation.
(k) The execution and delivery by the Obligor of this Purchase
Agreement, the Agreement, the Master Indenture, the Note, the Supplement, the
Mortgage, the Continuing Disclosure Certificate and the other documents
contemplated hereby and by the Preliminary and Final Official Statements, and the
compliance by the Obligor with the provisions thereof, do not conflict with or
constitute on the part of the Obligor a violation of, breach of or default under (i) its
Articles of Incorporation, Bylaws or any other governing instruments; (ii) any
constitutional provision, statute, indenture, mortgage, lease, resolution, note,
agreement or other agreement or instrument to which it is a party or by which it is
bound; or (iii) any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Obligor or any of its properties. All consents,
approvals, authorizations and orders of governmental or regulatory authorities, if
any, that are required to be obtained by the Obligor in connection with the
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issuance and sale of the Bonds, the execution and delivery of this Purchase
Agreement, and the consummation of the transactions contemplated by this
Purchase Agreement, the Indenture, the Agreement, the Master Indenture, the
Note, the Supplement, the Mortgage, the Continuing Disclosure Certificate and the
Preliminary and Final Official Statements have been duly obtained and remain in
full force and effect, except that no representation is made as to compliance with
any applicable state securities or "Blue Sky" laws.
(1) Neither the Obligor nor anyone acting on its behalf has, directly or
indirectly, offered the Bonds for sale to, or solicited any offer to buy the same
from, anyone other than the Underwriter.
(m) The Preliminary and Final Official Statements have been duly
authorized by the Obligor, and the Obligor has consented to the use of the
Preliminary and Final Official Statements by the Underwriter in connection with
the offering of the Bonds.
(n) Neither the Securities and Exchange Commission nor any state
securities commission has issued or, to the best of the knowledge of the Obligor,
threatened to issue, any order against the Obligor preventing or suspending the use
of the Preliminary Official Statement or the Final Official Statement or otherwise
seeking to enjoin the offer or sale of the Bonds.
(o) Any certificate signed by an authorized officer of the Obligor and
delivered to the Issuer or the Underwriter shall be deemed a representation and
warranty by the Obligor to the Issuer or the Underwriter as to the statements made
therein.
(p) The Obligor has never defaulted in the payment of principal of or
interest on any of its bonds, notes or other securities.
(q) The Obligor has and will cooperate with the Underwriter and its
counsel in any endeavor to qualify the Bonds for offering and sale under the
securities or "Blue Sky" laws of such jurisdictions of the United States of America
as the Underwriter may request; provided, however, that the Obligor will not be
required to qualify as a foreign corporation or file any special or general consents
to service of process under the laws of any state.
10. Closing. By no later than 1:00 P.M., Eastern Daylight Time, on April 1,
2013 (the "Closing Date"), the Issuer will deliver, or cause to be delivered, to or upon the
order of the Underwriter, the Bonds, in definitive form, duly executed and authenticated,
together with the other documents required in Section 11 hereof, and the Underwriter will
accept such delivery and pay the purchase price of the Bonds. Payment for the Bonds
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shall be made in immediately available funds by check or by bank wire transfer payable
to the order of the Bond Trustee on behalf of the Issuer.
The closing of the sale of the Bonds as aforesaid (the "Closing") shall be held at
the offices of Foley & Lardner LLP, Jacksonville, Florida, except that physical delivery
of the Bonds shall be made to the Bond Trustee as agent for The Depository Trust
Obligor, for the account of the Underwriter. Unless otherwise requested by the
Underwriter at or prior to the Closing, the Bonds will be delivered at the Closing in fully
registered form, registered to Cede & Co., and in the form of one certificate for each
maturity of the Bonds.
11. Closing Conditions. The obligations of the Underwriter hereunder shall be
subject (i) to the performance by the Issuer and the Obligor of their respective obligations
to be performed hereunder at and prior to the Closing or such earlier time as may be
specified herein; (ii) to the accuracy of each of the representations and warranties of the
Issuer and the Obligor contained herein as of the date hereof and as of the time of the
Closing, as if made at and as of the time of the Closing; and (iii) to the following
conditions, including the delivery by the Issuer and the Obligor of such documents as are
contemplated hereby in form and substance satisfactory to the Underwriter and
its counsel:
(a) At the time of the Closing (i) the Final Official Statement, the
Indenture, the Agreement, the Master Indenture, the Note, the Continuing
Disclosure Certificate, the Supplement and the Mortgage shall be in full force and
effect and shall not have been amended, modified or supplemented, except as may
have been agreed to in writing by the Underwriter; (ii) the Issuer shall have duly
adopted and there shall be in full force and effect such resolutions, including the
Resolution as, in the reasonable opinion of Bond Counsel, shall be necessary in
connection with the transactions contemplated hereby;
(b) At or prior to the Closing, the Underwriter shall have received the
following documents:
(i) The approving opinion of Bond Counsel, dated the date of
the Closing and in a form reasonably acceptable to the Underwriter and its
counsel.
(ii) The supplemental opinion of Bond Counsel, dated the date
of the Closing and in a form reasonably acceptable to the Underwriter and
its counsel.
(iii) An opinion of counsel to the Obligor, dated the date of the
Closing and in a form reasonably acceptable to the Underwriter, its counsel
and Bond Counsel.
12
(iv) An opinion of Counsel to the Issuer, dated the date of the
Closing, and in a form reasonably acceptable to the Underwriter, its counsel
and Bond Counsel.
(v) A certificate of the Issuer, dated the date of Closing,
signed by an authorized officer of the Issuer in form and substance
reasonably satisfactory to the Underwriter, its counsel and Bond Counsel,
to the effect that the representations and warranties of the Issuer contained
herein are true and correct in all material respects as of the Closing and that
the Issuer has performed its obligations under this Purchase Agreement.
(vi) A certificate of the Obligor, dated the Closing Date,
signed by an authorized officer of the Obligor in form and substance
reasonably satisfactory to the Underwriter, its counsel and Bond Counsel,
to the effect that the representations and warranties of the Obligor contained
herein are true and correct in all material respects as of the Closing and that
the Obligor has performed its obligations under this Purchase Agreement.
(vii) The Preliminary and Final Official Statements duly
executed, as applicable, by the Obligor by duly authorized officers together
with evidence of the consent by Moore Stephens Lovelace, P.A. to the
inclusion of their report in Appendix B to the Preliminary and Final Official
Statements.
(viii) Executed counterparts of the Indenture, the Agreement,
the Master Indenture, the Note, the Supplement, the Continuing Disclosure
Certificate and the Mortgage, together with due evidence of the recording
of any Uniform Commercial Code financing statements required with
respect thereto.
(ix) Certified copy of the Resolution, authorizing the issuance,
sale, execution and delivery of the Bonds and the execution, delivery and
performance of the Indenture, the Agreement and this Purchase Agreement,
and authorizing the use of the Preliminary and Final Official Statements by
the Underwriter in connection with the offering of the Bonds.
(x) Certified copy of resolutions of the Obligor authorizing
the execution, delivery and performance of the Agreement and this
Purchase Agreement, and authorizing the use of the Preliminary and Final
Official Statements by the Underwriter in connection with the offering of
the Bonds.
(xi) A specimen of the Bonds.
13
(xii) Evidence of maintenance of insurance required by the
Master Indenture.
(xiii) A letter from Moore Stephens Lovelace, P.A., dated the
Closing Date, addressed to the Issuer and the Underwriter, substantially in
the form of Exhibit C hereto, to the effect that such accountants reaffirm, as
of a date not more than three business days before the Closing, the
statements made and the consents given in the letters furnished by such
accountants pursuant to Sections 7 and 11(b)(vii) hereof.
(xiv) Copies of the (A) Articles of Incorporation of the Obligor,
certified as of a recent date by the Secretary of State of Florida and
(B) Bylaws of the Obligor, together with a certificate of an officer of the
Obligor that such Articles of Incorporation and bylaws have not been
amended, modified, revoked or rescinded and are in full force and effect as
of the Closing Date.
(xv) A Certificate of the Secretary of State of the State of
Florida with respect to the good standing of the Obligor.
(xvi) Internal Revenue Service Form 8038, signed by an
authorized officer of the Issuer.
(xvii) Evidence that Form BF2003/2004 has been executed by
the Issuer, to be filed with the Florida Division of Bond Finance.
(xviii) Evidence satisfactory to Bond Counsel and counsel to the
Underwriter that the Obligor is an organization described in Section
501(c)(3) of the Code and is not a private foundation as described in
Section 509(a) of the Code.
(xix) Evidence of the Issuer's public hearing and approval
relating thereto as required by Section 147(f) of the Code.
(xx) The certificates and opinions required by the Master
Indenture for the issuance thereunder of the Note.
(xxi) One executed copy of the Tax Regulatory Agreement
dated as of April 1, 2013, between the Obligor and the Issuer.
(xxii) One signed copy of a request and authorization to the
Bond Trustee to authenticate and deliver the Bonds.
(xxiii) Fitch Rating Letter.
14
(xxiv) Such additional legal opinions, certificates, proceedings,
instruments and other documents as counsel for the Underwriter may
reasonably request to evidence compliance by the Issuer and the Obligor
with the legal requirements, the truth and accuracy, as of the time of
Closing, of the representations of the Issuer and the Obligor herein
contained and the due performance or satisfaction by the Issuer and the
Obligor, at or prior to the Closing, of all agreements then required to be
performed and all conditions then required to be satisfied by the Issuer and
the Obligor at the Closing.
12. Conditions to Obligations of the Underwriter. The Underwriter shall have
the right to cancel its obligations to purchase and accept delivery of the Bonds hereunder
by notifying the Issuer and the Obligor, in writing, of its election to do so between the
date hereof and the Closing if, on or after the date hereof and prior to the Closing:
(a) legislation shall be enacted or be actively considered for enactment
by the Congress, or recommended to the Congress for passage by the President of
the United States, or favorably reported for passage to either House of the
Congress by a committee of such House to which such legislation has been
referred for consideration, a decision by a court of the United States or the United
States Tax Court shall be rendered, or a ruling, regulation or official statement by
or on behalf of the Treasury Department of the United States, the IRS or other
governmental agency shall be made or proposed to be made with respect to federal
taxation upon revenues or other income of the general character to be derived by
the Obligor or the Issuer or by any similar body, or upon interest on obligations of
the general character of the Bonds, or other action or events shall have transpired
that have the purpose or effect, directly or indirectly, of changing the federal
income tax consequences of any of the transactions contemplated in connection
herewith, including but not limited to any challenge of the Obligor as to its status
as an organization described in Sections 501(a) and 501(c)(3) of the Code, that, in
the reasonable opinion of the Underwriter, materially and adversely affects the
market price of the Bonds or the market price generally of obligations of the
general character of the Bonds; or
(b) any legislation, ordinance or regulation shall be enacted or be
actively considered for enactment by the Issuer, any governmental body,
department or agency of the State of Florida or a decision by any court of
competent jurisdiction within the State of Florida shall be rendered that, in the
reasonable opinion of the Underwriter, materially and adversely affects the market
price of the Bonds; or
(c) any action shall have been taken by the Securities and Exchange
Commission that would require the registration of the Bonds under the Securities
Act of 1933, as amended (the "1933 Act"), or the qualification of the Resolution,
15
the Indenture or the Master Indenture under the Trust Indenture Act of 1939, as
amended (the "TIA"); or
(d) any event shall have occurred or shall exist that, in the opinion of the
Underwriter, either (i) makes untrue or incorrect in any material respect any
statement or information contained in the Preliminary and Final Official
Statements, or (ii) is not reflected in the Preliminary and Final Official Statements
and should be reflected therein in order to make the statements and information
contained therein not misleading in any material respect, and the Issuer and the
Obligor shall not agree to supplement the Preliminary and Final Official
Statements to correct the same; or
(e) there shall have occurred any outbreak of, or escalation in, hostilities
or other national or international calamity or crisis or a financial crisis, including,
but not limited to, (i) the United States engaging in hostilities or (ii) a declaration
of war or a national emergency by the United States (including acts of terrorism)
on or after the date hereof which, in the sole opinion of the Underwriter, would
affect materially and adversely the ability of the Underwriter to market the Bonds
(it being understood that no such situation exists on the date hereof); or
(f) trading shall be suspended, or new or additional trading or loan
restrictions shall be imposed, by the New York Stock Exchange or other national
securities exchange or governmental authority with respect to obligations of the
general character of the Bonds or a general banking moratorium shall be declared
by federal, Florida or New York authorities; or
(g) there shall have occurred any change in the financial condition or
affairs of the Obligor, the effect of which, in the sole judgment of the Underwriter,
is so material and adverse as to make it impracticable or inadvisable to proceed
with the offering or delivery of the Bonds on the terms and in the manner
contemplated by the Preliminary and Final Official Statements; or
(h) Any litigation shall be instituted, pending or threatened to restrain or
enjoin the issuance, sale or delivery of the Bonds or in any way contesting or
questioning any authority for or the validity of the Bonds or the money or
revenues pledged to the payment thereof or any of the proceedings of the Issuer or
the Obligor taken with respect to the issuance and sale thereof;
(i) Fitch shall withdraw or lower its rating.
13. Termination. If the Issuer or the Obligor is unable to satisfy the conditions
to the obligations of the Underwriter contained in this Purchase Agreement, or if the
obligations of the Underwriter to purchase and accept delivery of the Bonds shall be
terminated for any reason permitted by this Purchase Agreement, this Purchase
16
Agreement shall terminate at the option of the Underwriter and neither the Underwriter
nor the Issuer nor the Obligor shall be under further obligation hereunder; except that the
respective obligations to indemnify and pay expenses, as provided in Sections 14 and 17
hereof, shall continue in full force and effect.
14. Indemnification. (a) To the fullest extent permitted by applicable law, the
Obligor agrees to indemnify and hold harmless the Underwriter, the Issuer or the other
persons described in subsection (b) below against any and all losses, damages, expenses
(including reasonable legal and other fees and expenses), liabilities or claims (or actions
in respect thereof), (i) to which the Underwriter, the Issuer or the other persons described
in subsection (b) below may become subject under any federal or state securities laws or
other statutory law or at common law or otherwise, caused by or arising out of or based
upon any untrue statement or misleading statement or alleged untrue statement or alleged
misleading statement of a material fact contained in the Preliminary and Final Official
Statements and not furnished by the indemnified party (it being understood and agreed
that the Issuer is solely responsible for the information contained under the captions
"THE ISSUER" and "LITIGATION—Issuer") or in the information furnished by the
Obligor, directly or indirectly or caused by any omission or alleged omission of
information regarding the Obligor from the Preliminary and Final Official Statements and
(ii)to which the parties indemnified hereunder or any of them may become subject under
the 1933 Act, the 1934 Act, the TIA, the rules or regulations under said Acts, insofar as
such losses, claims, damages, expenses, actions or liabilities arise out of or are based
upon the failure to register the Bonds or any security therefor under the 1933 Act or to
qualify the Indenture or the Master Indenture under the TIA; provided, however, that
with respect to (i) above, the Obligor shall not be required to indemnify or hold harmless
the Issuer with respect to statements in the Preliminary and Final Official Statements
under the captions "THE ISSUER" and "LITIGATION—Issuer" and with respect to (ii)
above, the Obligor shall not be required to indemnify or hold harmless the Issuer or the
Underwriter with respect to willful misconduct of the Issuer or the negligence or willful
misconduct of the Underwriter, respectively.
(b) The indemnity provided under this Section 14 shall extend upon the
same terms and conditions to each officer, director, employee, agent or attorney of
the Underwriter or the Issuer, and each person, if any, who controls the
Underwriter or the Issuer within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act. Such indemnity shall also extend, without limitation,
to any and all expenses whatsoever reasonably incurred by any indemnified party
in connection with investigating, preparing for or defending against, or providing
evidence, producing documents or taking any other reasonable action in respect of
any such loss, damage, expense, liability or claim (or action in respect thereof),
whether or not resulting in any liability, and shall include any loss to the extent of
the aggregate amount paid in settlement of any litigation, commenced or
17
threatened, or of any claim whatsoever as set forth herein if such settlement is
effected with the written consent of the Obligor.
(c) Within a reasonable time after an indemnified party under
paragraphs (a) and (b) of this Section 14 shall have been served with the summons
or other first legal process or shall have received written notice of the threat of a
claim in respect of which an indemnity may be claimed, such indemnified party
shall, if a claim for indemnity in respect thereof is to be made against the Obligor
under this Section 14, notify the Obligor in writing of the commencement thereof;
but the omission to so notify the Obligor shall not relieve it from any liability that
it may have to any indemnified party other than pursuant to paragraphs (a) and (b)
of this Section 14. The Obligor shall be entitled to participate at its own expense
in the defense, and if the Obligor so elects within a reasonable time after receipt of
such notice, or all indemnified parties seeking indemnification in such notice so
direct in writing, the Obligor shall assume the defense of any suit brought to
enforce any such claim, and in either such case, such defense shall be conducted
by counsel chosen promptly by the Obligor and reasonably satisfactory to the
indemnified party; provided however, that, if the defendants in any such action
include such an indemnified party and the Obligor, or include more than one
indemnified party and any such indemnified party shall have been advised by its
counsel that there may be legal defenses available to such indemnified party that
are different from or additional to those available to the Obligor or another
defendant indemnified party, and that in the reasonable opinion of such counsel
are sufficient to make it undesirable for the same counsel to represent such
indemnified party and the Obligor, or another defendant indemnified party, such
indemnified party shall have the right to employ separate counsel (who are
reasonably acceptable to the Obligor) in such action, and in such event the
reasonable fees and expenses of such counsel shall be borne by the Obligor.
Nothing contained in this paragraph (c) shall preclude any indemnified party, at its
own expense, from retaining additional counsel to represent such party in any
action with respect to which indemnity may be sought from the hereunder.
(d) If the indemnification provided for in paragraphs (a) and (b) of this
Section 14 is unavailable or insufficient to hold harmless and indemnify any
indemnified party in respect of any losses, damages, expenses, liabilities, or claims
(or actions in respect thereof) referred to therein, then the Obligor, on the one
hand, and the Underwriter, on the other hand, shall contribute to the amount paid
or payable by the indemnified party as a result of such losses, claims, damages,
expenses, actions or liabilities in such proportion as is appropriate to reflect the
relative benefits received by the Obligor on the one hand and the Underwriter on
the other hand from the offering of the Bonds. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law, or if the indemnified party failed to give the notice required under subsection
18
(c) above, the Obligor on the one hand and the Underwriter on the other hand shall
contribute to such amount paid or payable by the indemnified party in such
proportion as is appropriate to effect not only such relative benefits but also the
relative fault of the Obligor on the one hand and the Underwriter on the other in
connection with the statements or omissions that resulted in such losses, claims,
damages, expenses, actions or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Obligor on the one hand and
the Underwriter on the other hand shall be deemed to be in such proportion so that
the Underwriter is responsible for that portion represented by the percentage that
the underwriting discount payable to the Underwriter hereunder (i.e., the excess of
the aggregate public offering price for the Bonds as set forth on the inside cover
page of the Final Official Statement over the price to be paid by the Underwriter to
the Issuer upon delivery of the Bonds as specified in Section 1 hereof) bears to the
aggregate public offering price as described above, and the Obligor is responsible
for the balance. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
supplied by the Obligor on the one hand or the Underwriter on the other hand and
the parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Obligor and the Underwriter agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by pro rata allocation or by
any other method of allocation that does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, damages, expenses, liabilities, claims or actions referred to
above in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating or
defending any such action or claim.
15. Survival of Indemnity. The indemnity and contribution provided by
Section 14 hereof shall be in addition to any other liability that the Obligor may
otherwise have hereunder, at common law or otherwise, and is provided solely for the
benefit of the Underwriter, the Issuer and each director, officer, employee, agent, attorney
and controlling person referred to therein, and their respective successors, assigns and
legal representatives, and no other person acquire or have any right under or by virtue of
such provisions of this Purchase Agreement. The indemnity and contribution provided
by Section 14 hereof shall survive the termination or performance of this Purchase
Agreement.
16. Survival of Representations. All representations, warranties and
agreements of the Obligor set forth in or made pursuant to this Purchase Agreement shall
19
remain operative and in full force and effect, regardless of any investigations made by or
on behalf of the Underwriter and shall survive the delivery of and payment for the Bonds.
17. Payment of Expenses. If the Bonds are sold to the Underwriter by the
Issuer, the Obligor shall pay, out of the proceeds of the Bonds or from their own funds,
any expenses incident to the performance of its obligations hereunder, including but not
limited to: (i)the cost of the preparation, reproduction, printing, distribution, mailing,
execution, delivery, filing and recording, as the case may be, of this Purchase Agreement,
the Indenture, the Agreement, the Master Indenture, the Note, the Supplement, the
Continuing Disclosure Certificate, the Mortgage, the Preliminary Official Statement, the
Final Official Statement, Blue Sky Memoranda, and all other agreements and documents
required in connection with the consummation of the transactions contemplated hereby;
(ii)the cost of the preparation, engraving, printing, execution and delivery of the
definitive Bonds; (iii) the fees and disbursements of Bond Counsel, financial advisor to
the Issuer, counsel for the Issuer, counsel for the Obligor, counsel for the Bond Trustee
and the Master Trustee, counsel for the Underwriter, accountants, and any other experts
retained by the Obligor; (iv) the acceptance fees of the Bond Trustee and Master Trustee;
(v) the cost of transportation and lodging for officials and representatives of the Issuer
and the Obligor in connection with attending meetings and the Closing; and (vi) the cost
of qualifying the Bonds under the laws of such jurisdictions as the Underwriter may
designate, including filing fees and fees and disbursements of counsel for the Underwriter
in connection with such qualification and the preparation of Blue Sky Memoranda.
The Obligor shall also pay any expenses incident to the performance of its
obligations hereunder and, if the Bonds are not sold by the Issuer to the Underwriter, the
Obligor shall pay all expenses incident to the performance of the Issuer's obligations
hereunder as provided above.
The Underwriter shall pay (i) the cost of preparing and publishing all
advertisements approved by it relating to the Bonds upon commencement of the offering
of the Bonds; (ii) the cost of the transportation and lodging for officials and
representatives of the Underwriter to attend meetings and the Closing; (iii) any fees of the
Municipal Securities Rulemaking Board in connection with the issuance of the Bonds;
and (iv) the cost of obtaining a CUSIP number assignment for the Bonds.
18. Benefit of the Agreement. This Purchase Agreement shall inure to the
benefit of and be binding upon the Issuer, the Obligor and the Underwriter and their
respective successors and assigns. Nothing in this Purchase Agreement is intended or
shall be construed to give any person, firm or corporation, other than the parties hereto
and their respective successors and assigns, and the persons entitled to indemnity and
contribution under Section 0 hereof, and their respective successors, assigns and legal
representatives, any legal or equitable right, remedy or claim under or in respect of this
Purchase Agreement or any provision herein contained. This Purchase Agreement and
all conditions and provisions hereof are intended to be for the sole and exclusive benefit
20
of the parties hereto and their respective successors and assigns, and the persons entitled
to indemnity and contribution under Section 0 hereof, and their respective successors,
assigns and legal representatives, and for the benefit of no other person, firm or
corporation. No Underwriter who purchases the Bonds from the Underwriter or other
person or entity shall be deemed to be a successor merely by reason of such purchase.
19. Notices. Any notice or other communication to be given to the Issuer or
the Obligor under this Purchase Agreement may be given by delivering the same in
writing or by telex or telecopy to the address shown below, and any notice under this
Purchase Agreement to the Underwriter may be given by delivering the same in writing
to the Underwriter, as follows:
To the Issuer: City of Atlantic Beach, Florida
800 Seminole Road
Atlantic Beach, Florida 32233
Attention: City Manager
To the Obligor: Naval Continuing Care Retirement Foundation
1 Fleet Landing Boulevard
Atlantic Beach, Florida 32233
Attn: Chief Executive Officer
To the Underwriter: B.C. Ziegler and Company
200 South Wacker Drive, Suite 2000
Chicago, IL 60606
Attn: Daniel J. Hermann
together with a copy to: Nabors, Giblin&Nickerson, P.A.
2502 Rocky Point Drive
Tampa, FL 33607
Attn: John R. Stokes, Esq.
20. Waiver and Release of Personal Liability. No recourse under or upon any
obligation, indemnity, covenant or agreement contained in this Purchase Agreement or
under any judgment obtained against the Issuer, or by the enforcement of any assessment
or by legal or equitable proceedings by virtue of any constitution or statute or otherwise
or under any circumstances, under or independent of this Purchase Agreement, shall be
had against any trustee, director, member, commissioner, officer, employee or agent, as
such, past, present or future, of the Issuer, either directly or through the Issuer, or
otherwise, for the payment for or to the Issuer or any receiver thereof, or to the
Underwriter or otherwise of any amount that may become owed by the Obligor
hereunder. Any and all personal liability of every nature, whether at common law or in
equity, or by statute or constitution or otherwise, of any trustee, director, member,
21
commissioner, officer, employee or agent, as such, to respond by reason of any act or
omission on his part or otherwise, for the payment for or to the Issuer or any receiver
thereof, the Underwriter or otherwise, of any amount that may become owed by the
Issuer hereunder is hereby expressly waived and released as a condition of and in
consideration for the execution of this Purchase Agreement.
21. Governing Law. This Purchase Agreement shall be governed by and
construed in accordance with the laws of the State of Florida.
22. Effective Time of this Agreement. This Purchase Agreement shall become
effective upon the acceptance hereof by the Issuer and the Obligor.
23. Severability. If any provisions of this Purchase Agreement shall be held or
deemed to be or shall, in fact, be inoperative or unenforceable as applied in any particular
case in any jurisdiction or jurisdictions or in all jurisdictions, or in all cases because it
conflicts with any other provision or provisions hereof or any constitution or statute or
rule of public policy, or for any other reason, such circumstance shall not have the effect
of rendering the provision in question inoperative or unenforceable in any other case or
circumstance, or of rendering any other provision or provisions herein contained invalid,
inoperative, or unenforceable to any extent whatever. The invalidity of any one or more
phrases, sentences, clauses or Sections in this Purchase Agreement contained, shall not
affect the remaining portions of this Purchase Agreement, or any part thereof.
22
24. Execution in Counterparts. This Purchase Agreement may be signed in any
number of counterparts, each of which shall be an original, but all of which shall
constitute but one and the same instrument.
Very truly yours,
B.C. ZIEGLER AND COMPANY,
as Underwf -
IP
By: __ , l . _
• 'chard Scanlon, ■ ' . .gins Director
[Signature Page to Bond Purchase Agreement.]
Accepted and agreed t as CITY OF A IIANTIC BFACI 1. FLORIDA.
of the date lirst :ibove \\iittCl1 n sNL[k-2.1.
13\:
M or
Signature Pagc to Road Purchase Agreement.]
Accepted and agreed to as NAVAL CONTINUING CARE
of the date first above written: RETIREMENT FOUNDATION, INC.
By:
ief Executive icer
[Signature Page to Bond Purchase Agreement.]
EXHIBIT A
Maturities, Amounts, Interest Rates,Yields and Prices of Bonds
$11,985,000 Serial Bonds
Maturity Date Principal
(November 15) Amount Interest Rate Price Yield
2013 $ 605,000 1.10% 100.000 1.10%
2014 975,000 2.00 100.877 1.45
2015 100,000 2.00 100.509 1.80
2015 895,000 3.00 103.188 1.75
2016 220,000 2.00 100.000 2.00
2016 805,000 3.00 103.653 1.95
2017 150,000 2.25 100.000 2.25
2017 905,000 4.00 108.050 2.16
2018 120,000 2.50 100.000 2.50
2018 970,000 4.00 108.311 2.41
2019 1,135,000 5.00 114.380 2.62
2020 160,000 3.00 100.000 3.00
2020 1,030,000 5.00 114.192 2.91
2021 155,000 3.25 100.000 3.25
2021 1,090,000 5.00 114.275 3.10
2022 305,000 3.40 100.000 3.40
2022 1,000,000 5.00 114.357 3.25
2023 100,000 3.60 100.000 3.60
2023 1,265,000 5.00 113.683 3.45
Term Bonds
$400,000 4.125% Term Bond Due November 15,2028 Yield 4.125% Price 100.000
$7,520,000 5.000% Term Bond Due November 15,2028 Yield 3.950% Price 109.032*
$19,495,000 5.000% Term Bond Due November 15,2037 Yield 4.400% Price 105.042*
$650,000 4.625% Term Bond Due November 15,2037 Yield 4.625% Price 100.000
* Price calculated to first optional call date of November 15, 2023.
A-1
EXHIBIT B
Mandatory Sinking Fund and Optional Redemption of the Bonds
Mandatory Sinking Fund and Optional Redemption Provisions
Mandatory Sinking Fund Redemption. The Bonds are subject to mandatory
sinking fund redemption from amounts deposited to the Principal Account of the Bond
Fund established pursuant to the Bond Indenture by the Obligor, at a redemption price
equal to 100% of the principal amount to be redeemed, together with accrued interest to
the date fixed for redemption, on November 15 in each of the years and amounts as
follows:
4.125%Term Bond 5.00%Term Bond 5.00%Term Bond 4.625%Term Bond
Maturing Maturing Maturing Maturing
November 15,2028 November 15, 2028 November 15,2037 November 15, 2037
Principal Principal Principal Principal
Year Amount Year Amount Year Amount Year Amount
2024 $70,000 2024 $1,365,000 2029 $1,765,000 2029 $60,000
2025 75,000 2025 1,430,000 2030 1,860,000 2030 60,000
2026 80,000 2026 1,500,000 2031 1,950,000 2031 65,000
2027 80,000 2027 1,580,000 2032 2,050,000 2032 65,000
2028* 95,000 2028* 1,645,000 2033 2,150,000 2033 70,000
2034 2,255,000 2034 75,000
2035 2,365,000 2035 80,000
2036 2,490,000 2036 80,000
2037* 2,610,000 2037* 95,000
*Stated Maturity
Optional Redemption. The Bonds maturing on and after November 15, 2028 are
subject to optional redemption prior to maturity by the Issuer at the written direction of
the Obligor in whole or in part on November 15, 2023 or on any date thereafter, at a
redemption price equal to the principal amount of such Bonds to be redeemed, together
with accrued interest to the date of redemption.
B-1
EXHIBIT C
Form of Agreed Upon Procedures Letter
C-1
MOORE STEPHENS
LOVELACE, P.A.
CI R '1l i}PUBLIC ACCOUNTANTS AND MANAGEMENT CONSULTANTS
February 11,2013
Naval Continuing Care Retirement
Foundation,Inc. d/b/a Fleet Landing
Atlantic Beach, Florida
The City of Atlantic Beach, Florida
Atlantic Beach,Florida
B.C. Ziegler and Company
Chicago, Illinois
Dear Ladies and Gentlemen:
We have audited the balance sheets of the Naval Continuing Care Retirement Foundation, Inc. d/b/a Fleet
Landing (the "Obligor") as of December 31, 2011 and 2010, and the related statement of operations,
changes in net deficit, and cash flows for the years then ended, together with our report with respect
thereto, all included in Appendix B to the Preliminary Official Statement (the "Preliminary Official
Statement") dated February 12, 2013, related to the sale of The City of Atlantic Beach, Florida Health
Care Facilities Revenue and Refunding Bonds, (Fleet Landing Project), Series 2013A, in the estimated
aggregate principal amount of$41,130,000(the"Series 2013A Bonds").
We are independent public accountants with respect to the Obligor within the meaning of Rule
101 of the Code of Professional Conduct promulgated by the American Institute of Certified Public
Accountants, and its interpretations and rulings.
We have not audited any financial statements of the Obligor as of any date or for any period
subsequent to December 31, 2011, although we have conducted an audit for the year ended December 31,
2011, the purpose (and, therefore, the scope) of the audit was to enable us to express our opinion on the
financial statements as of December 31, 2011, and for the year then ended, but not on the financial
statements of the Obligor for any interim period within those years. Therefore, we are unable to and do
not express any opinion on the unaudited balance sheets, statements of operations, changes in the net
deficit, and cash flows of the Obligor as of any date or for any period subsequent to December 31,2011.
The procedures enumerated below would not necessarily reveal matters of significance with
respect to the comments above, nor would they necessarily disclose changes in specified financial
statement line items, inconsistencies in the application of generally accepted accounting principles, or
other matters. Also, such procedures would not necessarily reveal any material misstatement of the
amounts or percentages listed below,as set forth in the Preliminary Official Statements. Accordingly,we
make no representations regarding the sufficiency of the foregoing procedures for your purposes.
1201 S.Orlando Avenue,Suite 400•Winter Park,FL 32789-7192.407.740.5400.407.740.0012(facsimile)•www.mslcpa.com
MCAn independently owned and operated member of Moore Stephens North America,Inc.—members in principal cities throughout North America
►J Moore Stephens North America,Inc.is a member of Moore Stephens International Limited—members in principal cities throughout the world.
Naval Continuing Care Retirement Foundation, Inc.
The City of Atlantic Beach, Florida
B.0 Ziegler and Company
February 11,2013
Page 2
(1) At your request, we read the minutes of meetings of the Board of Directors of the
Obligor, as set forth in the minute books from January 1,2012 through February 11, 2013, officials of the
Obligor having advised us that the minutes of all such meetings through that date were set forth therein;
and we have carried out the following procedures to February 11,2013,as follows:
(a) With respect to the twelve-month period ended December 31,2012,we have:
(i) Read the unaudited balance sheet of the Obligor as of December 31,
2012 and the related unaudited statement of operations for the twelve-
month period ended December 31, 2012, included in Appendix A to the
Preliminary Official Statement, and agreed the amounts contained
therein with the Obligor's accounting records for such period.
(ii) Inquired of certain officials of the Obligor who have responsibility for
financial and accounting matters whether the unaudited financial
statements referred to in (1)(a)(i) are in conformity with accounting
principles generally accepted in the United States applied on a basis
substantially consistent with that of the audited financial statements
included in the Preliminary Official Statement. Those officials stated
that the unaudited financial statements are in conformity with accounting
principles generally accepted in the United States applied on a basis
substantially consistent with that of the audited financial statements.
(b) The Obligor officials have advised us that no financial statements for the Obligor
as of any date or for any period subsequent to December 31, 2012, are available;
accordingly,the procedures carried out by us with respect to changes in financial
statement items after December 31, 2012, have, of necessity, been even more
limited than those with respect to the period referred to in (1)(a)above. We have
inquired of certain officials of the Obligor who have responsibility for the
financial and accounting matters whether at February 11, 2013, there was any
increase in the long-term debt of the Obligor, as compared with amounts shown
in the December 31, 2012 unaudited financial statements included in the
Preliminary Official Statement, or whether there was any increase in net
liabilities of the Obligor, as compared with the amounts shown in the
December 31, 2012 unaudited financial statements included in the Preliminary
Official Statement. Those officials stated that the long-term debt did not increase
at February 11, 2013, as compared to the December 31, 2012 amounts. Those
officials also stated that net liabilities of the Obligor at February II, 2013 have
not increased from the amounts shown in the financial statements of the Obligor
at December 31,2012. In addition,we have been informed by those officials that
for the period from December 31, 2012 to February 11, 2013, as compared with
the corresponding period in the preceding year, there has been no decrease in
revenue and support or excess of revenues over expenses.
Naval Continuing Care Retirement Foundation, Inc.
The City of Atlantic Beach, Florida
B.0 Ziegler and Company
February 11,2013
Page 3
(2) At your request, we have read the following items in Appendix A to the Preliminary
Official Statement:
PAGE DESCRIPTION
A-17 through A-18 Financial information under the heading "Summary Statements of
Operations"and"Summary Statements of Financial Position"
A-19 through A-20 Financial information under the heading "Debt Service Coverage
Ratio"and"Days Cash on Hand"
At your request, we have performed the following additional procedures to the pages described
above:
(a) agreed amounts to the audited financial statements for the years ended
December 31, 2009,2010 and 2011;
(b) agreed unaudited amounts as of and for the year ended December 31,2012 to the
Obligor's accounting records;
(c) verified mathematical accuracy;
(d) recalculated the Debt Service Coverage Ratio by dividing the amounts in line
item "Funds Available for Debt Service"by the amounts in line item"Maximum
Annual Debt Service";
(e) recalculated the Days Cash on Hand amounts by dividing the amounts in line
item "Total Cash Operating Expenses" by the amounts in line item "Daily Cash
Operating Expenses."
We have no comment as to the method of calculating the Debt Service Coverage Ratio
and the Days Cash on Hand amount.
(3) Our audits of the financial statements for the periods referred to in the introductory
paragraph of this letter comprised audit tests and procedures deemed necessary for the purpose of
expressing an opinion on such financial statements taken as a whole. For none of the periods referred to
therein nor any other period, did we perform audit tests for the purpose of expressing an opinion on
individual balances of accounts or summaries of selected transactions, such as those enumerated above
and, accordingly, we express no opinion thereon.
(4) It should be understood that we have no responsibility for establishing (and did not
establish)the scope and nature of the procedures enumerated in paragraphs (1) and (2) above; rather, the
procedures enumerated therein are those the requesting parties asked us to perform. Accordingly, we
make no representations regarding questions of legal interpretation or regarding the sufficiency for your
purposes of the procedures enumerated in the preceding paragraphs; also, such procedures would not
necessarily reveal any material misstatement of the amounts listed above, as set forth in the Preliminary
Official Statement. Further, we have addressed ourselves solely to the foregoing data, as set forth in the
Preliminary Official Statement, and make no representations as to the adequacy of disclosure or as to
whether any material facts have been omitted. This letter relates only to the financial statement items
specified above and does not extend to any financial statements of the Obligor taken as a whole.
Naval Continuing Care Retirement Foundation, Inc.
The City of Atlantic Beach,Florida
B.0 Ziegler and Company
February 11,2013
Page 4
(5) The foregoing procedures do not constitute an audit conducted in accordance with
generally accepted auditing standards. Had we performed additional procedures or had we conducted an
audit or review of the Obligor's financial statements for the twelve-month period ended December 31,
2012, in accordance with standards established by the American Institute of Certified Public Accountants,
other matters might have come to our attention that would have been reported to you.
(6) In reaching the findings above, we have assumed that no information has come to your
attention which, if disclosed to us, could have materially affected our findings. Additionally, these
procedures should not be taken to supplement any additional inquiries or procedures that you would
undertake in your consideration of the proposed offering.
(7) We agree to the inclusion in Appendix B of the Preliminary Official Statement of our
report dated April 11, 2012, on our audit of the balance sheets of the Obligor as of December 31, 2011
and 2010, and the statements of operations,changes in net deficit,and cash flows for the years then ended
and the references to our Firm under the heading "INDEPENDENT AUDITORS" in the Preliminary
Official Statement.
(8) This letter is solely for your information and to assist you in your inquiries in connection
with the offering of the securities covered by the Preliminary Official Statement, and it is not be used,
circulated, quoted or otherwise referred to for any other purpose, including, but not limited to, the
registration, purchase, or sale of the securities, nor is it to be filed with or referred to in whole or in part in
the Preliminary Official Statement or any other document, except that reference may be made to it in any
list of closing documents pertaining to the offering of the securities covered by the Preliminary Official
Statement.
We have no responsibility to update this letter for events and circumstances occurring after
February 11, 2013.
Very truly yours,
7r /»�,z.Y n .a-,.Q.�..�e P. 4
MOORE STEPHENS LOVELACE,P.A.
Certified Public Accountants
Orlando, Florida
February 11, 2013
'II
C:CII-[Or11-[37002]-Flee!Landing-[l2/31/121-Binder:AUP for Bonds-I 001-Fleet Landing AUP Lm Draft
DISCLOSURE AND TRUTH IN BONDING STATEMENT
March 5, 2013
City of Atlantic Beach, Florida
Atlantic Beach, Florida
RE: $40,050,000 City of Atlantic Beach, Florida Health Care Facilities
Revenue and Refunding Bonds (Fleet Landing Project), Series 2013A
Ladies and Gentlemen:
In connection with the proposed issuance by the City of Atlantic Beach, Florida
(the "Issuer") of its $40,050,000 original aggregate principal amount of Health Care
Facilities Revenue and Refunding Bonds (Fleet Landing Project), Series 2013A (the
"Series 2013A Bonds"), B.C. Ziegler and Company, (the "Underwriter") is underwriting
a public offering of the Series 2013A Bonds. Capitalized terms used, but not otherwise
defined herein, shall have the respective meanings assigned such terms in the Bond
Purchase Agreement dated March 5, 2013 by and among the Issuer, the Underwriter and
the Naval Continuing Care Retirement Foundation, Inc. (the "Obligor").
The Issuer is proposing to issue $40,050,000 of Series 2013A Bonds for the
purpose of making a loan to the Obligor to (i) finance or reimburse the Obligor for the
cost of acquisition of approximately 2 acres of land, (ii) currently refund the Refunded
Bonds, (iii) fund a debt service reserve account for the Series 2013A Bonds and (iv) pay
costs and expenses related to the issuance of the Series 2013A Bonds. The Series 2013A
Bonds are expected to be repaid over a period of approximately 24 years. At an average
interest rate of 4.91% per annum, total interest paid over the life of the Series 2013A
Bonds will be $29,674,357.71. The source of repayment or security for this proposal
consists primarily of payments to be made by the Obligor under the Agreement and the
Note. Authorizing the Series 2013A Bonds will result in no monies of the Issuer not
being available to finance other services of the Issuer in any year.
The purpose of the following paragraphs of this letter is to furnish, pursuant to the
provisions of Section 218.385, Florida Statutes, certain information in respect of the
arrangements contemplated for the purchase and sale of the Series 2013A Bonds, as
follows:
1. The nature and estimated amount of expenses to be incurred by the
Underwriter in connection with the purchase and offering of the Series 2013A Bonds are
set forth in Schedule I attached hereto.
2. There are no "finders," as defined in Section 218.3 86, Florida Statutes,
connected with the sale and purchase of the Series 2013A Bonds.
3. The underwriting spread, the difference between the price at which the
Series 2013A Bonds will be initially offered to the public by the Underwriter and the
price to be paid to the Issuer for the Series 2013A Bonds, exclusive of accrued interest,
will be approximately $12.79 per $1,000 of Series 2013A Bonds issued.
4. As part of the estimated underwriting spread set forth in paragraph (3)
above, the Underwriter will charge a management fee of $4.00 per $1,000 of Series
2013A Bonds issued.
5. No other fee, bonus or other compensation is estimated to be paid by the
Underwriter in connection with the issuance of the Series 2013A Bonds to any person not
regularly employed or retained by the Underwriter (including any "fmder" as defined in
Section 218.386, Florida Statutes), except as specifically enumerated as expenses to be
incurred by the Underwriter, as set forth in paragraph (1) above.
6. The name and address of the Underwriter is:
B.C. Ziegler and Company
2048 Carolina Avenue, NE
St. Petersburg, Florida 33703-3455
Yours very truly,
B.C. ZIEG R AND CO i,_A Y
OPP
By / _ —
Managing Di - t• -
2
SCHEDULE I
UNDERWRITER'S ESTIMATED EXPENSES
(Per$1,000 of Bonds)
Schedule 1
Underwriter's Estimated Expenses
(per 1,000 of Bonds)
Expense Item Total Amount Per Bond
Conference calls and travel $7,899 0.197
Pershing Processing Fee 200 0.005
Fed Funds-Day Loan 1,113 0.028
DTC 500 0.012
MSRB 1,202 0.030
Bond Market Association 1,202 0.030
Ipreo Wire Usage 2,403 0.060
Cusips 547 0.014
Dealer Electronic Order Entry 150 0.004
Miscellaneous 2,808 0.070
TOTAL $18,022 $ 0.450