Loan Agreement with City of Gulf Breeze, FloridaLOAN AGREEMENT
DATED AS OF DECEMBER 1, 2009
Among
CITY OF MIAMI BEACH, FLORIDA
CITY OF GULF BREEZE, FLORIDA
AND
U.S. BANK NATIONAL ASSOCIATION
PERTAINING TO
$ L--]
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE REFUNDING BONDS,
TAXABLE SERIES 2009)-lA
$[]
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE REFUNDING BONDS,
TAXABLE SERIES 2009)-1B
$U
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE BONDS,
TAXABLE SERIES 2009)-1C
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Prepared by and return to:
Richard I. Lott, Esq.
Lott & Associates, P.L.
25 West Cedar Street, Suite 500
Pensacola, Florida 32502
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TABLE OF CONTENTS
ARTICLE I BACKGROUND AND REPRESENTATIONS ..................................................................................1
SECTION 1.1 BACKGROUND .........................................................................................................................1
SECTION 1.2 REPRESENTATIONS OFTHE GOVERNMENTAL UNIT ......................................................3
SECTION 1.3 SPONSOR REPRESENTATIONS AND COVENANTS ............................................................ 5
SECTION 1.4 ADMINISTRATOR REPRESENTATIONS ...............................................................................6
SECTION 1.5 TRUSTEE REPRESENTATIONS ..............................................................................................6
ARTICLE II DEFINITIONS .....................................................................................................................................8
SECTION 2. I DEFINITIONS ............................................................................................................................. 8
ARTICLE III THE FINANCING PROGRAM .....................................................................................................14
SECTION 3.1 MAKING OF LOAN; APPLICATION OF SERIES 2009)-1 LOAN PROCEEDS ................... 14
SECTION 3.2 DISBURSEMENT OF SERIES 2009)-1 LOAN; SECURITY INTEREST IN UNDISBURSE D
PROCEEDS; PAYMENT OF COSTS OF THE PROGRAM AND FEES AND EXPENSES OF
THE FINANCING PROGRAM ................................................................................................ 14
SECTION 3.3 REPAYMENT OF SERIES 2009)-1 LOAN .............................................................................. 15
SECTION 3.4 PREPAYMENT OF SERIES 2009)-1 LOAN ........................................................................... 18
SECTION 3.5 RESERVE BONDS ................................................................................................................... 19
SECTION 3.6 SPECIAL OBLIGATION OF GOVERNMENTAL UNIT ........................................................ 20
SECTION 3.7 BENEFIT OF PROGRAM BONDHOLDERS AND CREDIT ISSUERS; COOPERATION
BETWEEN PARTIES ............................................................................................................... 22
SECTION 3.8 PRESERVATION OF TAX-STATUS; PROGRAM BONDS NOT TO BECOME
ARBITRAGE BONDS .............................................................................................................. 22
SECTION 3.9 ASSIGNMENT OF SPONSOR'S RIGHTS .............................................................................. 23
SECTION 3.10 COVENANT REGARDING PLEDGED REVENUES ............................................................. 23
SECTION 3.11 ALTERNATE SECURITY FOR 2009)-1 GOVERNMENTAL UNIT NOTES;
DEFEASANCE ......................................................................................................................... 24
SECTION 3.12 INTERLOCAL AGREEMENT ................................................................................................. 25
ARTICLE IV COVENANTS OF THE GOVERNMENTAL UNIT .....................................................................26
SECTION 4.1 REPORTS AND OPINIONS; INSPECTIONS ..........................................................................26
SECTION 4.2 IMMUNITY OF SPONSOR ......................................................................................................27
SECTION 4.3 COMPLIANCE WITH LAWS ..................................................................................................27
SECTION 4.4 ISSUANCE OF OTHER OBLIGATIONS PAYABLE FROM PLEDGED REVENUES.........28
SECTION 4.5 RESERVED ...............................................................................................................................28
SECTION 4.6 ADDITIONAL COVENANTS ..................................................................................................28
ARTICLE V EVENTS OF DEFAULT AND REMEDIES ....................................................................................30
SECTION 5.1 EVENTS OF DEFAULT ...........................................................................................................30
SECTION 5.2 ACCELERATION .....................................................................................................................31
SECTION 5.3 PAYMENT OF SERIES 2009)-1 LOAN ON DEFAULT; SUIT THEREFOR .........................32
SECTION 5.4 OTHER REMEDIES .................................................................................................................33
SECTION 5.5 CUMULATIVE RIGHTS ..........................................................................................................33
SECTION 5.6 DISCONTINUANCE OF PROCEEDINGS ..............................................................................34
SECTION 5.7 NOTICE OF DEFAULT ............................................................................................................34
SECTION 5.8 LIMITATION UPON REMEDIES AND ENFORCEMENT .................................................... 34
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ARTICLE VI MISCELLANEOUS .........................................................................................................................36
SECTION 6.1 LIMITATION OF LIABILITY ..................................................................................................36
SECTION 6.2 NO PERSONAL RECOURSE ...................................................................................................36
SECTION 6.3 NOTICES ..................................................................................................................................36
SECTION 6.4 ILLEGAL OR INVALID PROVISIONS DISREGARDED ......................................................37
SECTION 6.5 APPLICABLE LAW .................................................................................................................37
SECTION 6.6 ASSIGNMENTS .......................................................................................................................37
SECTION 6.7 AMENDMENTS .......................................................................................................................38
SECTION 6.8 TERM OF AGREEMENT .........................................................................................................38
SECTION 6.9 HEADINGS ...............................................................................................................................38
SECTION 6.10 NOTICE OF EXPECTATION OF OBLIGATION TO MAKE CERTAIN PAYMENTS.........38
SECTION 6.11 ENTIRE AGREEMENT ............................................................................................................38
SECTION 6.12 LIMITATION OF INVESTMENT EARNINGS CREDIT ........................................................38
EXHIBIT "A-I" FORM OF 2009)-lA GOVERNMENTAL UNIT NOTE ................................................... A-1-1
EXHIBIT "A-2" FORM OF 2009)-IB GOVERNMENTAL UNIT NOTE ................................................... A-2-1
EXHIBIT "A-3" FORM OF 2009)-1C GOVERNMENTAL UNIT NOTE ................................................... A-3-1
SCHEDULE "I" TO LOAN AGREEMENT SERIES 2009 PROJECT ........................................SCHEDULE I 1
SCHEDULE "II" TO LOAN AGREEMENT FEES AND EXPENSES .....................................SCHEDULE II -1
SCHEDULE "III" TO LOAN AGREEMENT PRINCIPAL AND INTEREST PAYMENT SCHEDULE
........................................................................................................................................................ SCHEDULE III - 1
SCHEDULE "IV" TO LOAN AGREEMENT REDEMPTION OF PROGRAM BONDS.... SCHEDULE IV -1
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LOAN AGREEMENT
This LOAN AGREEMENT, dated as of December 1, 2009, between U.S. BANK
NATIONAL ASSOCIATION, as successor Trustee, and its successors and assigns (the
"Trustee") for the holders of the Program Bonds (as defined herein), CITY OF GULF
BREEZE, FLORIDA (the "Sponsor") acting by and through Beverly Zimmern, Mayor, as
Administrator (the "Administrator") and the CITY OF MIAMI BEACH, FLORIDA (the
"Governmental Unit"), a municipal corporation of the State of Florida, witnesseth as follows:
ARTICLE I
BACKGROUND AND REPRESENTATIONS
SECTION 1.1 BACKGROUND.
(a) The Sponsor, a municipal corporation of the State of Florida, as issuer of the
Program Bonds hereinafter referred to, is authorized to exercise those powers conferred by
Chapters 166 and 163, Florida Statutes, as amended.
(b) In December, 1985, the Sponsor issued $300,000,000 aggregate principal amount
of its Local Government Loan Program Floating Rate Demand Revenue Bonds, Series 1985B,
Series 1985C and Series 1985E, of which $87,695,000 was subsequently remarketed and
separately secured as Local Government Loan Program Floating Rate Demand Revenue Bonds,
Series 1985F, Series 1985G and Series 1985H. As of the date hereof all of such Series 1985F,
Series 1985G and Series 1985H Bonds, together with $15,085,000 of the 1985B, Series 1985C
and Series 1985E Bonds are being re-designated Series 1985) Bonds (all of such Series 1985)
Bonds collectively being herein referred to as the "Program Bonds") The Program Bonds are
issued under and are secured by the Trust Indenture dated as of December 1, 1985, as amended
and restated as of July 1, 1986, as further amended and supplemented through the date hereof
and as particularly supplemented by the Nineteenth Supplemental Trust Indenture dated as of
December 1, 2009 (collectively, the "Indenture") between the Sponsor and the Trustee.
(c) Pursuant to the Indenture, the Sponsor has caused the net proceeds of the Program
Bonds to be deposited with the Trustee, in the amount of $102,780,000 to be used (i) to make
Loans (the "Loans") to "Governmental Units," as defined in the Indenture, for the purposes of
financing and refinancing the cost of the acquisition and installation by Governmental Units of
qualified projects (the "Projects"), and (ii) maintaining reserves for the Program Bonds as
described in the Indenture (the "Program").
(d) Under the Indenture, the Sponsor has pledged, for the security and repayment of
the Program Bonds, inter alia, the amounts to be received in repayment of the Loans, in the
manner set forth in the Indenture.
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(e) Pursuant to Resolution 95-21585, duly adopted by the governing body of the
Governmental Unit on May 17, 1995 (the "Original Resolution" and as amended and
supplemented from time to time, the "Bond Resolution"), the Governmental Unit has previously
issued its (1) Water and Sewer Revenue Bonds, Series 2000 (the "2000 Bonds"), and (2) Water
and Sewer Revenue Refunding Bonds, Taxable Series 20068-1; Water and Sewer Revenue
Bonds, Taxable Series 2006E-2; Water and Sewer Revenue Refunding Bonds, Taxable Series
2006C and Water and Sewer Revenue Bonds, Taxable Series 2006E (collectively, the "Parity
Notes"). The portion of the 2000 Bonds not refunded from proceeds of the Series 2009)-1 A
Loan or the Series 2009)-1B Loan, as each is defined herein (the "Parity Bonds"), and the Parity
Notes will remain outstanding and will continue to be secured by a first lien upon and pledge of
the Pledged Revenues, as herein defined, on a parity with the lien upon and pledge of the
Pledged Revenues granted to secure repayment of the principal and interest on the 2009)-1
Governmental Unit Notes as defined below.
(f) (1) The Administrator has approved a commitment (the "Series J-1 A
Refunding Commitment") to make a Loan described herein by the Sponsor to the Governmental
Unit (the "Series 2009)-lA Loan") in the principal amount of $[], for the purpose of
refunding, together with other moneys of the Governmental Unit and a contribution from the
Sponsor as more fully described in Schedule "II" hereto, a portion of the 2000 Bonds consisting
of the 2000 Bonds maturing in the years 2016 through 2020, as more fully described in the
Escrow Deposit Agreement, herein defined (the "Series J-1 A Refunded Bonds"), which shall
hereinafter be referred to as the "Series J-1 A Refunding Program."
(2) The Administrator has further approved a commitment (together with the
Series J-lA Refunding Commitment, the "Refunding Commitment") to make a Loan described
herein by the Sponsor to the Governmental Unit (the "Series 2009)-1B Loan") in the principal
amount of $[___], for the purpose of refunding, together with other moneys of the
Governmental Unit and a contribution from the Sponsor as more fully described in Schedule "II"
hereto, an additional portion of the 2000 Bonds consisting of a portion of the 2000 Bonds
maturing in the year 2025, as more fully described in the Escrow Deposit Agreement (the "Series
J-1 B Refunded Bonds" and together with the Series J-1 A Refunded Bonds, the "Refunded
Bonds"), which shall hereinafter be referred to as the "Series J-1 B Refunding Program" and
together with the Series J-1 A Refunding Program, shall hereinafter be referred to as the
"Refunding Program."
(2) The Administrator has further approved a commitment (the "New Money
Commitment" and together with the Refunding Commitment, the "Commitment") to make an
additional Loan described herein by the Sponsor to the Governmental Unit (the Series 2009)-1C
Loan" and together with the Series 2009)-1 A Loan and the Series 2009)-1 B Loan, the "Series
2009)-1 Loan") in the principal amount of $~~, for the purpose of paying, together with
any other moneys of the Governmental Unit, the costs of acquiring, constructing, and equipping
certain capital improvements to the Governmental Unit's Water and Sewer Utility as further
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described on Schedule "I" hereto (the "Series 2009 Project"), which shall hereinafter be referred
to, together with the Refunding Program, as the "Financing Program."
(g) To evidence the obligation to repay the Series 2009)-lA Loan and the Series
2009)-1B Loan made pursuant to this Agreement, the Governmental Unit will execute and
deliver two issues of bonds under Section 210 of the Original Resolution in an aggregate
principal amount equal to the principal amount of the Series 2009)-lA Loan and the Series
2009)-1B Loan, respectively, and bearing interest payable at such times and in such amounts
relating to the related Program Bonds, all in substantially the forms attached hereto as Exhibit
"A-1 " (the "2009)-1 A Governmental Unit Note") and Exhibit "A-2" (the "2009)-1 B
Governmental Unit Note"). To evidence the obligation to repay the Series 2009)-1C Loan made
pursuant to this Agreement, the Governmental Unit will execute and deliver an issue of bonds
under Section 209 of the Original Resolution in an aggregate principal amount equal to the
principal amount of the Series 2009)-1C Loan and bearing interest payable at such times and in
such amounts relating to the related Program Bonds, all in substantially the form attached hereto
as Exhibit "A-3" (the "2009)-1 C Governmental Unit Note" and together with the 2009)-1 A
Governmental Unit Note and the 2009)-1 B Governmental Unit Note, the "2009)-1
Governmental Unit Notes"). As security for the Program Bonds, the Sponsor is assigning to the
Trustee all its right, title and interest in the 2009)-1 Governmental Unit Notes and this
Agreement (except for the rights reserved by the Sponsor as described in Section 3.9 hereof).
(h) The amount of Program Bonds required by the Indenture to be converted to the
Interest Rate Mode relating to the principal amount of the 2009)-1 Governmental Unit Notes has
been converted (the "Converted Bonds"), effective on the Loan Closing Date, to such Interest
Rate Mode for corresponding Interest Rate Periods as required by the Indenture. The principal
amounts and interest rates on the 2009)-1 Governmental Unit Notes correspond to the interest
rates and mandatory tender dates for the Converted Bonds of the Sponsor.
(i) The proceeds of the Series 2009)-1 Loan shall be applied as provided herein to
pay a portion of the cost to accomplish the Financing Program.
(j) The Governmental Unit has received a favorable recommendation of the
Governmental Unit's financial advisor concerning the Financing Program.
SECTION 1.2 REPRESENTATIONS OF THE GOVERNMENTAL UNIT.
(a) The Governmental Unit is a municipal corporation of the State of Florida, with
full power and legal right to enter into this Agreement and perform its obligations hereunder, and
to consummate the Refunding Program and to finance the remaining portion of the Financing
Program in the manner contemplated herein. The Governmental Unit's actions in making and
performing this Agreement have been duly authorized by all necessary official action and will
not violate or conflict with any applicable provision of the Constitution, or law of the State of
Florida or with any ordinance, governmental rule or regulation, or with any agreement,
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instrument or other document by which the Governmental Unit or its funds or properties are
bound.
(b) The amount of the Series 2009)-1 Loan, plus anticipated investment earnings
thereon and any other amounts to be deposited under the Escrow Deposit Agreement to carry out
the Refunding Program, does not exceed the Costs of the Financing Program.
(c) The proceeds of the Series 2009)-1 Loan will be applied to pay a portion of the
cost of the Financing Program, including amounts required to be deposited with the Escrow
Agent for the Refunding Program.
(d) Immediately after the execution hereof, no Event of Default (as defined in this
Agreement) shall exist hereunder nor shall there exist any condition which with lapse of time, the
giving of notice, or both, would constitute such an Event of Default.
(e) On October 14, 2009, the Governmental Unit duly adopted Resolution No. 2009-
(the "Authorizing Instrument"), which constitutes a Series Resolution for the 2009)-1
Governmental Unit Notes under the Original Resolution, authorizing the Series 2009)-1 Loan,
this Agreement, the 2009)-1 Governmental Unit Notes and the Continuing Disclosure
Certificate. The terms and provisions of the Authorizing Instrument are hereby incorporated by
reference.
(f) The Governmental Unit is duly authorized and empowered under the laws of the
State of Florida, particularly Chapter 163, Florida Statutes, as amended, the Act, as herein
defined, the Bond Resolution, and the Authorizing Instrument to enter into this Agreement, to
issue the 2009)-1 Governmental Unit Notes, to pledge the sources hereinafter mentioned to the
repayment of the 2009)-1 Governmental Unit Notes, and to apply the proceeds thereof to the
payment of the Costs of the Financing Program.
(g) The Governmental Unit has not entered into any arrangement, formal or informal,
to purchase any Program Bonds in an amount related to the Series 2009)-1 Loan, and will not
hereafter enter into any such arrangement or authorize any related person to the Governmental
Unit to enter into any such arrangement.
(h) Pursuant to the Bond Resolution, the Pledged Revenues will be pledged to the
payment of the principal of and interest on the 2009)-1 Governmental Unit Notes, on a parity
with the Parity Bonds and Parity Notes. The 2009)-lA Governmental Unit Note and the 2009J-
1 B Governmental Unit Note issued to refund the Refunded Bonds constitute "Refunding Bonds"
as defined and described under the Original Resolution. Proceeds from the Series 2009)-lA
Loan and the Series 2009)-1B Loan will be deposited, along with other moneys of the
Governmental Unit and a contribution from the Sponsor as more fully described in Schedule "II"
hereto, into an escrow deposit trust fund as described in an Escrow Deposit Agreement dated as
of December 1, 2009 (the "Escrow Deposit Agreement") between the Governmental Unit and
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U.S. Bank National Association, as Escrow Agent, in amounts sufficient to defease, pay and
redeem the Refunded Bonds. The 2009)-1C Governmental Unit Note issued to finance the
Series 2009 Project constitutes "Additional Bonds" as defined and described under the Original
Resolution.
(i) The Governmental Unit is in compliance with all covenants and undertakings in
connection with the Refunded Bonds, Parity Bonds and Parity Notes. All requirements and
conditions under the Act and the Original Resolution for the issuance of the 2009)-lA
Governmental Unit Note and the 2009)-1 B Governmental Unit Note as "Refunding Bonds" and
all requirements and conditions under the Act and the Original Resolution for the issuance of the
2009)-1C Governmental Unit Note as "Additional Bonds" under the Original Resolution, each
secured, as to principal and interest, on a parity with the Parity Bonds and Parity Notes, have
been satisfied.
(j) The Pledged Revenues are not pledged or encumbered in any manner, except for
the payment of the Refunded Bonds, which are being refunded and defeased as of the date
hereof, the Parity Bonds, the obligations to the issuer of a certain Reserve Account Insurance
Policy (as defined in the Original Resolution) and the Parity Notes. The Governmental Unit
represents and warrants that the principal and interest on the 2009)-1 Governmental Unit Notes
will be payable on a parity with the Parity Bonds and Parity Notes.
(k) The Governmental Unit is issuing the 2009)-1 Governmental Unit Notes for the
purpose of financing a portion of the Cost of the Financing Program.
(1) The Governmental Unit has received an opinion of Special Tax Counsel from
Gonzalez Saggio & Harlan LLP, to the effect that the Series 2009)-1 Loan will not adversely
affect the tax-exempt status of the Program Bonds, and has relied upon such opinion in making
the representations contained herein regarding such matter.
(m) The facilities to be refinanced and refunded with the proceeds of the Series 2009J-
lA Loan and the Series 2009)-1B Loan and the Series 2009 Project shall at all times be owned
and operated by the Governmental Unit (subject only to lease or management agreements
permitted under Section 4.6 (c) hereof).
SECTION 1.3 SPONSOR REPRESENTATIONS AND COVENANTS.
The Sponsor hereby represents:
(a) The Sponsor is a municipal corporation of the State of Florida duly existing, and
with full power and authority to issue the Program Bonds and to enter into this Loan Agreement
and to make the Series 2009)-1 Loan herein contemplated.
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(b) By proper action the Sponsor has duly authorized the issuance and sale of the
Program Bonds, the remarketing thereof on December 1, 2009 as Series 1985) Bonds and the
execution and delivery of this Agreement. In accordance with the Indenture, the Sponsor has
appointed the Administrator to execute, undertake and perform the Sponsor's duties hereunder;
and all actions taken by the Administrator on behalf of the Sponsor pursuant to such appointment
shall be deemed to be the action of the Sponsor.
(c) The Sponsor is not in default under any provision of the Indenture, and no "Event
of Default" as defined therein, or event which, with the passage of time or the giving of notice or
both would constitute an Event of Default, has occurred and is continuing.
(d) The Sponsor has received no notification of any investigation concerning the
determination of taxability of interest on the Program Bonds, and has no basis to believe that any
such investigation will be initiated or that any such determination could be made.
(e) This Agreement, the 2009)-1 Governmental Unit Notes and the Series 2009)-1
Loan do not conflict with or violate the Indenture, and will not violate or conflict with any
applicable provision of the Constitution, laws of the State of Florida or with any ordinance,
governmental rule or regulation, or with any agreement, instrument or other document by which
the Sponsor or its funds or properties are bound, and all action necessary or required by the
Indenture precedent to the execution and delivery of this Agreement and the performance thereof
by the Sponsor have been completed.
(i) The Sponsor will make no other Loans funded with proceeds of the Program
Bonds without obtaining a Favorable Opinion of Bond Counsel.
(g) There are currently no outstanding Non-Asset Bonds.
(h) There are no Increased Costs outstanding as of the date hereof.
SECTION 1.4 ADMINISTRATOR REPRESENTATIONS.
The Administrator represents that she has duly authorized the execution and delivery of
this Agreement. In accordance with the Indenture, the Sponsor has appointed the Administrator
to execute, undertake and perform the Sponsor's duties hereunder either personally or through
Government Credit Corporation, as Independent Contractor; and all actions taken by the
Administrator or the Independent Contractor on behalf of the Sponsor pursuant to such
appointment shall be deemed to be the action of the Sponsor.
SECTION 1.5 TRUSTEE REPRESENTATIONS.
The Trustee represents that it is a national banking association organized under the laws
of the United States duly existing, and with full power and authority to enter into this Agreement
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and perform its obligations hereunder and under the Indenture on behalf of the holders of the
Program Bonds. By proper action the Trustee has duly authorized the execution and delivery of
this Agreement and the Indenture.
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ARTICLE II
DEFINITIONS
SECTION 2.1 DEFINITIONS.
Capitalized terms defined in Article 1 shall have the meanings set forth therein. The
capitalized terms used in this Agreement which are defined in the Indenture, in the Authorizing
Instrument or the Bond Resolution and not in this Agreement, shall have the meanings assigned
thereto in the Indenture, the Authorizing Instrument or the Bond Resolution unless the context
hereof expressly requires otherwise. In addition, the following terms shall have the meanings
defined as follows:
"2000 Bonds" shall mean the Governmental Unit's $54,310,000 Water and Sewer
Revenue Bonds, Series 2000, dated as of August 15, 2000.
" 20068-1 Governmental Unit Note" shall mean the City of Miami Beach, Florida
Water and Sewer Revenue Refunding Bonds, Taxable Series 20068-1, issued in the aggregate
principal amount of $8,500,000, currently outstanding in the aggregate principal amount of
$8,500,000 and issued to evidence the indebtedness made under the loan described in the 20068-
1 Loan Agreement.
"20068-2 Governmental Unit Note" shall mean the City of Miami Beach, Florida
Water and Sewer Revenue Bonds, Taxable Series 20068-2, issued in the aggregate principal
amount of $18,300,000, currently outstanding in the aggregate principal amount of $18,300,000
and issued to evidence the indebtedness made under the loan described in the 20068-2 Loan
Agreement.
" 2006C Governmental Unit Note" shall mean the City of Miami Beach, Florida Water
and Sewer Revenue Refunding Bonds, Taxable Series 2006C, issued in the aggregate principal
amount of $27,500,000, currently outstanding in the aggregate principal amount of $16,995,000
and issued to evidence the indebtedness made under the loan described in the 2006C Loan
Agreement.
" 2006E Governmental Unit Note" shall mean the City of Miami Beach, Florida Water
and Sewer Revenue Bonds, Taxable Series 2006E, issued in the aggregate principal amount of
$5,700,000, currently outstanding in the aggregate principal amount of $5,700,000 and issued to
evidence the indebtedness made under the loan described in the 2006E Loan Agreement.
"20068-1 Loan Agreement" shall mean the Loan Agreement between the Governmental
Unit and the Sponsor dated as of May 1, 2006, and executed and delivered in connection with the
issuance of the 20068-1 Governmental Unit Note evidencing the indebtedness made under the
loan described therein.
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" 2006B-2 Loan Agreement" shall mean the Loan Agreement between the Governmental
Unit and the Sponsor dated as of May 1, 2006, and executed and delivered in connection with the
issuance of the 2006B-2 Governmental Unit Note evidencing the indebtedness made under the
loan described therein.
" 2006C Loan Agreement" shall mean the Loan Agreement between the Governmental
Unit and the Sponsor dated as of May 1, 2006, and executed and delivered in connection with the
issuance of the 2006C Governmental Unit Note evidencing the indebtedness made under the loan
described therein.
" 2006E Loan Agreement" shall mean the Loan Agreement between the Governmental
Unit and the Sponsor dated as of May 1, 2006, and executed and delivered in connection with the
issuance of the 2006E Governmental Unit Note evidencing the indebtedness made under the loan
described therein.
"2009)-1 Governmental Unit Notes" shall mean the 2009)-lA Governmental Unit
Note, the 2009)-1 B Governmental Unit Note and the 2009)-1 C Governmental Unit Note.
"2009)-lA Governmental Unit Note" shall mean the City of Miami Beach, Florida
Water and Sewer Revenue Refunding Bonds, Taxable Series 2009)-lA, authorized pursuant to
the Original Resolution and the Authorizing .Instrument and issued to evidence the indebtedness
relating to the Series 2009)-lA Loan made under Section 3.1 of this Loan Agreement.
"2009)-1B Governmental Unit Note" shall mean the City of Miami Beach, Florida
Water and Sewer Revenue Refunding Bonds, Taxable Series 2009)-1B, authorized pursuant to
the Original Resolution and the Authorizing Instrument and issued to evidence the indebtedness
relating to the Series 2009)-1B Loan made under Section 3.1 of this Loan Agreement.
"2009)-1C Governmental Unit Note" shall mean the City of Miami Beach, Florida
Water and Sewer Revenue Bonds, Taxable Series 2009)-1C, authorized pursuant to the Original
Resolution and the Authorizing Instrument and issued to evidence the indebtedness relating to
the Series 2009)-1C Loan made under Section 3.1 of this Loan Agreement.
"Act" shall mean the Constitution and laws of the State of Florida, including Chapter
166, Florida Statutes, as amended, the Charter of the Governmental Unit, and other applicable
provisions of law.
"Additional Indebtedness" shall mean indebtedness or other obligations currently
outstanding or hereafter issued under the terms, conditions and provisions of Sections 208, 209,
210, 211 or 212 of the Original Resolution, including obligations authorized as "Alternative
Parity Debt" under Section 212 of the Original Resolution.
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"Administrative Expenses" shall mean the portion of the Costs and Expenses of the
Program allocable to the recurring fees of the Administrator, the Independent Contractor, the
Financial Advisor and the Sponsor.
"Authorizing Instrument" shall mean Resolution No. 2009- duly adopted by
the Governmental Unit on October 14, 2009, authorizing the Series 2009)-1 Loan, this
Agreement, the 2009)-1 Governmental Unit Notes and the Continuing Disclosure Certificate.
"Agreement" shall mean this instrument, as amended and supplemented in accordance
herewith, constituting one of the Loan Agreements for the Program.
"Bonds" shall have the meaning assigned to such term in the Original Resolution.
"Commitment" shall mean collectively the commitments of the Administrator to make
the Series 2009)-1 Loan.
"Continuing Disclosure Certificate" shall mean the undertaking to provide certain
continuing information concerning the Governmental Unit and the Water and Sewer Utility.
"Cost" or "Costs" in connection with the Financing Program, shall mean any cost
incurred or estimated to be incurred by the Governmental Unit which is reasonable and necessary
for carrying out all works and undertakings in providing for the accomplishment of the Financing
Program, including the Refunding Program, the reasonable cost of financing incurred by the
Governmental Unit or the Sponsor in connection with the execution of this Agreement, including
payment or reimbursement to the Sponsor and Administrator for the fees, charges and out-of-
pocket expenses and the cost of such other items as may be reasonable and necessary for the
establishment of the Financing Program.
"Costs and Expenses of the Program" shall mean the reasonable fees, charges and
expenses of the Trustee, the Sponsor, the Registrar and Paying Agent, the Independent
Contractor, the Financial Advisor and the Administrator including the reasonable fees and
expenses of general or special counsel (including Bond Counsel and Special Tax Counsel for the
Sponsor) to any of the foregoing. Without limitation of the foregoing, the annual Administrative
Expenses may be assessed to the Governmental Unit without regard to the amounts assessed in
respect of such fees and charges on any other Program Loans, in amounts not exceeding in the
aggregate 32 basis points per annum, based upon the outstanding principal amount of the 2009J-
1 Governmental Unit Note, exclusive of out of pocket expenses and disbursements and
reasonable counsel fees and expenses. All costs and expenses payable by the Governmental Unit
shall be paid monthly.
"Crossover Bonds" shall mean the Issuer's Revenue Refunding Bonds (Local
Government Loan Program) Series 2009 issued to refund and retire, on December 1, 2020, the
Program Bonds.
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"Escrow Agent" shall mean U.S. Bank National Association.
"Escrow Deposit Agreement" shall mean the agreement between the Governmental
Unit and the Escrow Agent dated as of December 1, 2009, pursuant to which provision has been
made for the payment of the Refunded Bonds.
"Financial Advisor" unless specifically provided otherwise, shall have the meaning as
provided in the Indenture.
"Fiscal Year" shall mean the period commencing on October 1 of each year and
continuing through the next succeeding September 30, or such other annual period as may be
prescribed by law or by the Governmental Unit in accordance with law.
"Local Credit Enhancement" or "Local Letter of Credit" shall mean a credit
enhancement device acceptable in form and substance to the Credit Facility Issuer securing
timely payment of principal of and interest and premium, if any, on the 2009)-1 Governmental
Unit Notes.
"Parity Bonds" shall mean the portion of the 2000 Bonds remaining outstanding on
December 1, 2009 after issuance of the 2009)-1 A Governmental Unit Note and the 2009)-1 B
Governmental Unit Note.
"Parity Notes" shall mean the 2006E-1 Governmental Unit Note, the 20068-2
Governmental Unit Note, the 2006C Governmental Unit Note and the 2006E Governmental Unit
Note.
"Pledged Revenues" shall mean the Net Revenues (as defined in the Original
Resolution) of the Governmental Unit's Water and Sewer Utility, and the funds and accounts
pledged in accordance with the Bond Resolution, other than the Reserve Account created
thereunder.
"Program Bonds" shall mean the Sponsor's Local Government Loan Program Floating
Rate Demand Revenue Bonds, Series 1985J.
"Pro-Rata Share" shall mean the percentage derived by dividing the outstanding
principal amount of the Governmental Unit's Series 2009)-1 Loan by the sum of (1) the principal
amount of all Loans outstanding funded with Program Bond proceeds (including any unpaid
Loans to Governmental Units that may have been discharged in bankruptcy or declared void or
unenforceable) plus (2) the amounts on deposit in the Project Loan Fund.
"Recycled Bond Proceeds" shall mean proceeds used to make Loans from the Loan
Repayment Account under the Indenture.
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"Refunded Bonds" shall mean, collectively, the Series J-lA Refunded Bonds and the
Series J-1 B Refunded Bonds.
"Refunding Program" shall mean the refunding of the Refunded Bonds as described in
this Agreement.
"Reserve Payment" shall mean, for any period of calculation: (a) except as provided in
the penultimate sentence of this definition, the Governmental Unit's Pro-Rata Share of principal
payments required to be made in respect of Non-Asset Bonds hereafter arising under the
Indenture in respect of the Program Bonds; and (b) the Pro-Rata Share of interest expense and
other Costs and Expenses of the Program (other than Administrative Expenses) allocable to the
Reserve Bonds (as defined in Section 3.5 hereof) or incurred pursuant to Section 3.5(a) hereof;
and (c) the Liquidation Shortfall as provided in Section 3.5(b) of this Agreement. The
Governmental Unit shall not be entitled to a reduction of or credit toward the amount of such
fees and expenses that the Governmental Unit may be obligated to pay pursuant to Section 3.3
hereof and Section 4.04 of the Indenture during any Interest Period, in respect of any investment
earnings received on the funds held under the Indenture provided that the net earnings on the
Debt Service Reserve Fund for any Interest Period (after payment of interest on and the Costs
and Expenses of the Program for such period, other than the fees and expenses of the Trustee,
Bond Registrar and Paying Agent, including Administrative Expenses relating to the Reserve
Bonds), shall be applied to pay Costs and Expenses of the Program (including Administrative
Expenses) and interest on the Reserve Bonds prior to computing the amount of such Costs and
Expenses for which the Governmental Unit will have responsibility for payment of its Pro-Rata
Share. The computation of the Reserve Payment of the Governmental Unit shall be made
assuming full payments will be timely received in respect of each Loan to other Governmental
Units whether or not the payments thereunder are actually made or may be discharged in
bankruptcy or declared void or unenforceable for any reason, it being the intention of the parties
that no Governmental Unit shall bear any financial obligation arising because of the invalidity of
or a default in any Loan of another Governmental Unit. In calculating the amount of the
Governmental Unit's Reserve Payment in respect of the principal amount of any Non-Asset
Bonds arising after the date hereof, the Governmental Unit's Pro-Rata Share of such Non-Asset
Bonds shall be amortized and paid in equal monthly installments over the lesser of 60 months or
the remaining life of the Program Bonds. For purposes of determining the Governmental Unit's
Reserve Payment, it shall be assumed that any unpaid Loans which may have been discharged in
bankruptcy or declared void or unenforceable continue to remain outstanding until all amounts
which would have been due in respect thereof in accordance with their terms have been
deposited with the Trustee hereunder.
"Series 2009)-1 Loan" shall mean collectively the Series 2009)-lA Loan, the Series
2009)-1 B Loan and the Series 2009)-1 C Loan.
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"Series 2009)-lA Loan" shall mean the loan described in this Loan Agreement and
made by the Sponsor to the Governmental Unit from the proceeds of the Program Bonds to
provide funds which, together with other moneys of the Governmental Unit and a contribution
from the Sponsor as more fully described in Schedule "II" hereto, will be used to finance the
Series J-lA Refunding Program.
"Series 2009)-1B Loan" shall mean the loan described in this Loan Agreement and
made by the Sponsor to the Governmental Unit from the proceeds of the Program Bonds to
provide funds which, together with other moneys of the Governmental Unit and a contribution
from the Sponsor as more fully described in Schedule "II" hereto, will be used to finance the
Series J-1B Refunding Program.
"Series 2009)-1C Loan" shall mean the loan described in this Loan Agreement and
made by the Sponsor to the Governmental Unit from the proceeds of the Program Bonds to
provide funds which, together with any other moneys of the Governmental Unit, will be used to
finance the Series 2009 Project.
"Series J-lA Refunded Bonds" shall mean the portion of the 2000 Bonds maturing in
the years 2016 through and including 2020, and being refunded with proceeds of the Series
2009)-lA Loan and other available moneys, all as more fully described in the Escrow Deposit
Agreement.
"Series J-1B Refunded Bonds" shall mean a portion of the 2000 Bonds maturing in the
year 2025, and being refunded with proceeds of the Series 2009)-1B Loan and other available
moneys, all as more fully described in the Escrow Deposit Agreement.
"Series J-lA Refunding Program" shall mean the refunding of the Series J-lA
Refunded Bonds as described in this Agreement.
"Series J-1B Refunding Program" shall mean the refunding of the Series J-1 B
Refunded Bonds as described in this Agreement.
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ARTICLE III
THE FINANCING PROGRAM
SECTION 3.1 MAKING OF LOAN; APPLICATION OF SERIES 2009)-1
LOAN PROCEEDS.
From the amounts on deposit in the Loan Repayment Account of the Project Loan Fund
created under the Indenture and certain available funds derived by the Issuer from investment
earnings of funds relating to the Program, the Governmental Unit hereby agrees to borrow and
repay the sum of $~) comprised of $[) principal amount of the Series 2009J-
lA Loan, $~] principal amount of the Series 2009)-1B Loan and $L--] principal
amount of the Series 2009)-1C Loan. The Series 2009)-1 Loan made hereby shall be repaid in
the aggregate in accordance with the 2009)-1 Governmental Unit Notes and Section 3.3 hereof.
The Governmental Unit covenants that it shall use' the proceeds of the Series 2009)-1 Loan
solely for the purposes described in Section 1.2(k) hereof and the Governmental Unit's Tax and
Non-Arbitrage Certificate executed in connection with the Closing of the Series 2009)-1 Loan,
and that it shall not use the proceeds of the Series 2009)-1 Loan in a manner inconsistent with
the representations and covenants set forth in Section 1.2 hereof.
SECTION 3.2 DISBURSEMENT OF SERIES 2009)-1 LOAN; SECURITY
INTEREST IN UNDISBURSED PROCEEDS; PAYMENT OF COSTS OF THE
PROGRAM AND FEES AND EXPENSES OF THE FINANCING PROGRAM.
(a) (i) Following the execution and delivery of this Loan Agreement and the
2009)-1 Governmental Unit Notes (the "Closing"), the Trustee shall:
(1) disburse $[_____) from proceeds of the Series 2009)-lA Loan to the
Escrow Agent for the Series J-1 A Refunded Bonds, which shall hold and apply
such funds, together with the other funds described in the Escrow Deposit
Agreement (including a contribution from the Sponsor as more fully described in
Schedule "II" hereto), according to the provisions thereof;
(2) deposit $[____.~ from proceeds of the Series 2009)-1B Loan to the
Escrow Agent for the Series J-1B Refunded Bonds, which shall hold and apply
such funds, together with the other funds described in the Escrow Deposit
Agreement (including a contribution from the Sponsor as more fully described in
Schedule "II" hereto), according to the provisions thereof; and
(3) deposit $[____-] from proceeds of the Series 2009)-1C Loan to the
Series 2009)-1C Construction Account created under the Bond Resolution and
such funds shall be applied solely to pay costs of the Series 2009 Project.
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(ii) The Governmental Unit agrees that, upon request of the Trustee or the
Administrator, it shall supply such documentation as the Trustee, the Administrator or the
Credit Facility Issuer, if any, may reasonably require to determine that the proceeds of the
Series 2009)-1 Loan have been applied solely to payment of the Costs of the Financing
Program, including the Refunding Program.
(b) (i) To secure the prompt payment of the Series 2009)-lA Loan and the Series
2009)-1B Loan and the performance by the Governmental Unit of its other obligations
hereunder, the Governmental Unit, but only to the extent permitted by law and the Bond
Resolution, hereby pledges to the Sponsor and agrees and acknowledges that the Sponsor
shall have and shall continue to have a pledge of and lien upon the proceeds of the Series
2009)-1 A Loan and the Series 2009)-1 B Loan and any investment income thereon,
subordinate in all respects to the lien created in favor of the holders of the Refunded
Bonds, until applied in the manner described herein and in the Escrow Deposit
Agreement, for the purpose of assuring the defeasance of the Refunded Bonds; and
(ii) To secure the prompt payment of the Series 2009)-1C Loan and the
performance by the Governmental Unit of its other obligations hereunder, the
Governmental Unit, but only to the extent permitted by law and the Bond Resolution,
hereby pledges to the Sponsor and agrees and acknowledges that the Sponsor shall have
and shall continue to have a pledge of and lien upon the proceeds of the Series 2009)-1C
Loan and any investment income thereon, until applied in the manner described herein,
for the purpose of assuring the financing of the Series 2009 Project.
(c) Simultaneously with the Closing, the Trustee shall pay from surplus funds held
for the account of the Sponsor under the Indenture the fees and expenses of the Financing
Program as well as other amounts as described in and as set forth on Schedule "II" attached
hereto. It is further agreed that except for Reserve Payments and subject to the provisions of
Section 6.12 hereof, the Governmental Unit shall have no liability for Costs and Expenses of the
Program.
SECTION 3.3 REPAYMENT OF SERIES 2009)-1 LOAN.
U.S. Bank National Association (within this paragraph, "U.S. Bank") is hereby appointed
as the Governmental Unit's Bond Registrar (as defined in the Bond Resolution) for the 2009)-1
Governmental Unit Notes. All payments shall be paid and disbursed by the Governmental Unit
on or before the due date, to U.S. Bank in immediately available funds. U.S. Bank shall apply all
of such payments received from the Governmental Unit in accordance with this Loan Agreement
and the Indenture.
The Series 2009)-1 Loan shall be repaid in installments which shall correspond in time
and amount to the payments of principal and interest coming due on the 2009)-1 Governmental
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Unit Notes and shall bear interest at the rates, and shall be payable in immediately available
funds at the times payable on the 2009)-1 Governmental Unit Notes, as follows:
(a) The interest on the Series 2009)-lA Loan shall be paid in semi-annual
installments on the dates and computed at the rates that correspond to the payment dates and
interest rates on the 2009)-1 A Governmental Unit Note, attached hereto as Exhibit "A-1 ". The
interest on the Series 2009)-1B Loan shall be paid in semi-annual installments on the dates and
computed at the rates that correspond to the payment dates and interest rates on the 2009)-1 B
Governmental Unit Note, attached hereto as Exhibit "A-2". The interest on the Series 2009)-1C
Loan shall be paid in semi-annual installments on the dates and computed at the rates that
correspond to the payment dates and interest rates on the 2009)-1C Governmental Unit Note,
attached hereto as Exhibit "A-3". Principal on the Series 2009)-1 Loan shall be payable in
installments on the dates and in the amounts shown in the respective 2009)-1 Governmental Unit
Notes. The final payment on the respective 2009)-1 Governmental Unit Note must be made
three business days prior to its maturity with immediately available funds. The aggregate
principal and interest payments on the 2009)-1 Governmental Unit Notes is set forth in Schedule
"III" attached hereto. Except for annual installment payments when due as described herein, the
Governmental Unit shall not be entitled to prepay the Series 2009)-1 A Loan. The 2009)-1 B
Governmental Unit Note and the 2009)-1 C Governmental Unit Note shall be subject to optional
prepayment in full on December 1, 2020 under the circumstances described in the 2009)-1B
Governmental Unit Note and the 2009)-1 C Governmental Unit Note, respectively.
(b) As provided in the 2009)-1 Governmental Unit Notes, in addition to the above
payments of principal and interest on the Series 2009)-1 Loan, any payment required to be made
with respect to the Series 2009)-1 Loan which is received later than its due date, shall bear
interest from such due date at a rate per annum equal to the higher of the interest on the
respective 2009)-1 Governmental Unit Note or the Prime Rate, plus two per centum per annum
(the "Default Rate"). In addition, if an acceleration of the Series 2009)-1 Loan is declared
pursuant to Section 5.2 hereof following the occurrence of any Event of Default hereunder, the
interest rate on the Series 2009)-1 Loan shall be increased to the Default Rate. Notwithstanding
anything otherwise contained in this Loan Agreement, the interest rate on the Series 2009)-1
Loan and all other amounts payable hereunder which are treated as interest under applicable laws
shall not exceed the maximum rate per annum permitted by law (the "Maximum Rate");
provided, that, in the event the imposition of such Maximum Rate shall ever cause the amount
payable on the 2009)-1 Governmental Unit Notes to be less than the amount of interest which
would otherwise be computed pursuant to this Section 3.3, the 2009)-1 Governmental Unit Notes
shall thereafter bear interest at the Maximum Rate until the earlier of (1) the final maturity of the
respective 2009)-1 Governmental Unit Note or (2) such time as the total amount of interest paid
on the respective 2009)-1 Governmental Unit Note shall at such rate equal the amount of interest
which would have been payable on the such 2009)-1 Governmental Unit Note pursuant to this
Section 3.3 without regard to any Maximum Rate. All payments made hereunder shall be
applied first to payment of accrued interest on the unpaid balance hereof at the aforesaid rate,
then to the reduction of principal and then to payment of other amounts due hereunder.
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(c) The Governmental Unit shall also pay all Reserve Payments. The Financial
Advisor, on behalf of the Sponsor, shall determine not less often than each January 1 and July 1
the estimated Reserve Payments, if any, allocable to the period for which such payment is to be
in effect and shall notify the Trustee and the Administrator of such determination. The
Administrator shall compute the amount of the Governmental Unit's payment in respect of such
amount and shall notify the Trustee, the Sponsor, any Credit Facility Issuer and the
Governmental Unit, of the amount thereof. Reserve Payments under clauses (a) and (c) of the
definition of "Reserve Payments" shall be billed to the Governmental Unit and shall be due
within thirty (30) days of receipt of such notice. The remaining components of the Reserve
Payment shall be payable by the Governmental Unit in semi-annual installments for the next
ensuing semi-annual period. The Financial Advisor shall notify the Governmental Unit at least
ten (10) days prior to the first day of the month in which the new payment amount is to become
effective, of the period (not exceeding six (6) months) for which such payment amount is to be in
effect, the amount of each interest payment which the Governmental Unit is required to make
during such period and the computations used to determine such payment. However, if at any
time the Trustee determines that such payment amount, together with other funds available
therefor, does not provide sufficient funds to pay the Governmental Unit's Reserve Payment, if
any, the Trustee shall so notify the Administrator and the Financial Advisor. The Financial
Advisor, on behalf of the Sponsor shall increase the payment amount on the Series 2009)-1 Loan
then in effect by an amount sufficient to cure any deficiency in the payment of the Governmental
Unit's Reserve Payment by giving notice thereof to the Administrator. The Administrator shall
recompute the amount of the Governmental Unit's semiannual payments and shall give the
Governmental Unit notice of a revised payment and the computations used to determine such
payment at least ten (10) days prior to the date such revised payment is to become effective,
stating the period (not exceeding six (6) months) for which such revised additional payments are
to be in effect, and the amount of each payment which the Governmental Unit is required to
make during such period. The Administrator shall send to the. Trustee and the Credit Facility
Issuer, if any, duplicate copies of each statement to the Governmental Unit specifying the total
payment due from the Governmental Unit, which shall specify the respective amounts of
principal and interest due and the Reserve Payment amount billed to the Governmental Unit on a
semi-annual basis pursuant to this Section.
(d) As set forth in the Indenture, earnings and other moneys in the Payment Account
in the Loan Reserve Fund shall be applied for the purposes set forth in Section 5.07 of the
Indenture, including, where provided therein, to or for the benefit of the Governmental Unit.
Notwithstanding any other provision contained in this Agreement or in the 2009)-1
Governmental Unit Notes, all computations of the Reserve Payments and any other amounts due
under this Agreement, if any, or the 2009)-1 Governmental Unit Notes shall be made assuming
that full principal and interest and other required payments will be received in respect of each
Loan made from the Program Bonds to any other Governmental Unit, whether or not such Loan
is in default; it being the intention of the Sponsor that except as provided in the proviso at the
end of Section 3.3(e) hereof, the Governmental Unit shall not bear any financial obligation
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arising because of a default in any Loan to any other party. Notwithstanding any provision of the
Indenture or this Agreement to the contrary, the Governmental Unit shall not be obligated to pay
any portion of the costs of any Liquidity Facility or Remarketing Agent for the Program Bonds;
provided, however, that in computing any amount to be included in the payments required of
the Governmental Unit for the interest on the Reserve Bonds, earnings on moneys in the Reserve
Account shall first be applied to pay such costs of any applicable Liquidity Facility and the
Remarketing Agent in respect of the Reserve Bonds, and only the remaining interest earnings on
such monies shall be credited toward the interest on the Reserve Bonds in accordance with the
Indenture in computing the Reserve Payment of the Governmental Unit.
(e) Notwithstanding anything herein to the contrary, the Reserve Payment shall not
include any amounts attributable to the default of any other Governmental Unit, and the 2009)-1
Governmental Unit Notes and the principal amounts thereof and interest thereon shall not be
increased or accelerated for any reason related to an acceleration or redemption of the Program
Bonds other than as a result of an Event of Default under the 2009)-1 Governmental Unit Notes
or this Agreement in accordance herewith; provided that the Governmental Unit's Reserve
Payment may be affected by reductions in the investment income on the Debt Service Reserve
Fund and Loan Reserve Fund as a consequence of market conditions or the acceleration or
redemption of the Program Bonds.
SECTION 3.4 PREPAYMENT OF SERIES 2009)-1 LOAN.
(a) The 2009)-1 Loan matures in annual installments. Except for such payment when
due of such installments, the Governmental Unit shall not be entitled to prepay the Series 2009J-
1 ALoan.
(b) (i) The Governmental Unit shall be entitled to prepay the Series 2009)-1 B
Loan and the Series 2009)-1C Loan (the "Prepayable Loans") in whole or in part on any date
upon which the Program Bonds converted to a Fixed Rate Mode for a Long Fixed Rate Period in
connection with the Prepayable Loans may be redeemed or converted to another Mode at the
option of the Sponsor or may be called for mandatory tender by the Sponsor, upon not less than
one hundred twenty-nine (129) days prior written notice to the Sponsor, the Administrator and
the Trustee. Such Program Bonds may be redeemed or converted as and to the extent provided
on Schedule "IV".
(ii) Any such prepayment in whole shall be made with the effect provided in
Section 4.04 of the Indenture, it being understood that all prepayments must be made not less
than one hundred twenty-nine (129) days in advance of any application thereof, unless the
Indenture shall otherwise permit. The prepayment shall be in an amount equal to the sum of (A)
accrued and unpaid interest on the Prepayable Loan as of the date on which redemption or tender
of the Program Bonds can occur following processing of such notice and (B) the product
obtained by multiplying (i) the outstanding principal amount of the Prepayable Loan to be
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prepaid by (ii) the quotient obtained by dividing (y) the principal amount of the Program Bonds
then Outstanding by (x) the amount of Program Assets (as defined in the Indenture) held by the
Trustee, provided that the quotient shall not be less than 1.0. In no event, however, shall the
prepayment amount for such prepayment in whole be less than the principal amount of the
Prepayable Loan then Outstanding plus accrued interest and any unpaid Reserve Payment
amount due in respect of the Prepayable Loan.
In the case of a partial prepayment of the Prepayable Loans, the amount of any
such prepayment which shall be applied to the reduction of the outstanding principal balance of
the applicable Prepayable Loan shall be reduced by an amount equal to the sum of (A) the
amount of interest which accrues on the Prepayable Loan from the date of its deposit with the
Trustee until the first Business Day which is not earlier than one hundred twenty-nine (129) days
thereafter (the "Prepayment Effective Date") and (B) the difference between (1) the product
obtained by multiplying (i) the outstanding principal amount of the Prepayable Loan to be
prepaid (as reduced by the amount described in clause (A) of this sentence) by (ii) the quotient
obtained by dividing (y) the principal amount of the Program Bonds then Outstanding by (x) the
amount of Program Assets on the Prepayment Effective Date, provided that the quotient shall not
be less than 1.0 and (2) the outstanding principal amount of the Prepayable Loan to be prepaid
(as reduced by the amount described in clause (A) of this sentence).
Notwithstanding anything herein to the contrary, the one hundred twenty-nine
(129) day periods mentioned in paragraphs (b)(i) and (ii) hereof may run concurrently. The
Governmental Unit shall receive credit for any income from investment of the amount of any
such prepayment. Any computation of the prepayment amount under this Section 3.4(b) shall be
made assuming all payments are made by Participating Governmental Units, as provided in
Section 3.3(d) hereof.
(iii) The amount of any prepayment shall also include any amounts necessary
to pay prepayment premiums, if any, to the holders of the Converted Bonds in connection with a
redemption thereof from the proceeds of the prepayment.
(iv) In determining the amount and effect of any prepayments under this
Section 3.4(b), Program Assets shall include any unpaid Loans, including any unpaid Loans that
may have been discharged in bankruptcy or declared void or unenforceable.
SECTION 3.5 RESERVE BONDS.
(a) The Governmental Unit hereby agrees and acknowledges that a principal amount
of Program Bonds, in the par amount equal to $32,960,000 (the "Reserve Bonds") has been
established for the repayment of Loans made from the Program Bonds to the Governmental Unit
and with respect to which the Program incurs costs and expenses. Alike amount of moneys on
deposit in the Debt Service Reserve Fund and the Loan Reserve Fund under the Indenture for the
Program Bonds are to be invested in compliance with Section 6.02 of the Indenture. The
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Governmental Unit hereby acknowledges that pursuant to the Indenture, the amount of funds
which may be used to pay Program Bonds or which may result in a Liquidation Shortfall, as
defined in Subsection (b) of this Section 3.5, is not limited to the amount of the Reserve Bonds,
and that the full amount of the Debt Service Reserve Fund and the Loan Reserve Fund for all
Program Bonds may be used as provided in the Indenture, including, among other things for
payment of Program Bonds in the event of a default by the Governmental Unit.
(b) In the event that a default of the Governmental Unit results in the liquidation of
investments in the Debt Service Reserve Fund or Loan Reserve Fund, the Governmental Unit
will pay the "Liquidation Shortfall." "Liquidation Shortfall" shall mean the loss, if any, incurred
by the Sponsor as a result of such a liquidation versus the amount which would have been
realized if such investments would have been sold at a price (exclusive of investment earnings
thereon) equal to their purchase price.
In the event that for any other reason permitted under the Indenture (other than a default
by another Governmental Unit) a draw upon the Loan Reserve Fund or the Debt Service Reserve
Fund results in a liquidation of the investments therein, the Governmental Unit agrees to pay the
Governmental Unit's Pro-Rata Share of the Liquidation Shortfall as a component of the Reserve
Payment following such liquidation. No charges for any Liquidity Facility or Remarketing
Agent in respect of the Reserve Bonds shall be borne by the Governmental Unit; however upon
any determination by the Administrator that the investment earnings on the investment of funds
allocable to the proceeds of the Reserve Bonds is projected to be insufficient to pay the interest
on the Reserve Bonds (after first applying such earnings to pay the charges for any Liquidity
Facility and the Remarketing Agent in respect of the Reserve Bonds), the Governmental Unit
shall pay, as a component of the Reserve Payment such amounts as determined by the
Administrator under Subsections 3.3(c) and (d) hereof. The Governmental Unit's obligations
under this paragraph shall be subject to the limitations in Section 3.3(e).
SECTION 3.6 SPECIAL OBLIGATION OF GOVERNMENTAL UNIT.
(a) Each Credit Issuer may share with any other Credit Issuer any information given
to any of them by the Governmental Unit, including without limitation financial statements, and
may also share such information with any participant of such Credit Issuer, and any financial
institution which is being solicited to become a participant of any Credit Issuer. To the extent
necessary to permit the foregoing, the Governmental Unit hereby waives any privilege or right to
confidentiality, whether arising under statute or otherwise, it may have which would otherwise
prohibit the foregoing sharing of information.
(b) The payment of principal and interest on the 2009)-1 Governmental Unit Notes
shall be secured by a lien upon and pledge of the Pledged Revenues on parity and equal status
with the Parity Bonds and the Parity Notes. The Governmental Unit hereby represents and
warrants that such pledge of the Pledged Revenues to secure the 2009)-1 Governmental Unit
Notes is valid, binding and enforceable and that the Pledged Revenues are not, as of the date
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hereof, otherwise subject to any pledge, encumbrances or lien, other than for the payment of the
Refunded Bonds, which are being refunded and defeased, the Parity Bonds, the Parity Notes and
the obligations to the issuer of a certain Reserve Account Insurance Policy. The Governmental
Unit covenants that it will not cause or permit to exist any pledge of or lien upon the Pledged
Revenues other than the pledges securing the 2009)-1 Governmental Unit Notes, the Parity
Bonds, the Parity Notes and Additional Indebtedness authorized in accordance with the Bond
Resolution.
Reserve Payments and any other amounts (other than principal and interest) due or
payable on the 2009)-1 Governmental Unit Notes or this Agreement (such Reserve Payments
and other amounts collectively referred to herein as "Supplemental Loan Costs") shall be
payable from Pledged Revenues under the provisions of Section 513 of the Original Resolution
and shall be secured by a lien upon and pledge of the Pledged Revenues, junior and subordinate
to the lien thereon and pledge thereof for the payment of the Parity Bonds, any Additional
Indebtedness authorized in accordance with the Bond Resolution, and the principal and interest
on the 2009)-1 Governmental Unit Notes and the Parity Notes.
(c) Prior to each of its Fiscal Years, the Governmental Unit shall establish a budget
for such fiscal year which allocates a sufficient sum of Pledged Revenues to pay all amounts
reasonably anticipated by the Governmental Unit to be payable hereunder and all amounts
reasonably anticipated to be payable with respect to the Parity Bonds and any Additional
Indebtedness. In the event that the budgeted amounts prove insufficient to make said payments,
the Governmental Unit shall as soon as practicable (but in any event prior to the expiration of
ninety (90) days from such event) amend its budget so as to assure that sufficient Pledged
Revenues are available to at all times make said payments.
(d) The Series 2009)-1 Loan and the 2009)-1 Governmental Unit Notes, and all
payments due with respect thereto or under this Loan Agreement, shall be special limited
obligations of the Governmental Unit, payable solely from the Pledged Revenues as herein
provided. The Series 2009)-1 Loan and the 2009)-1 Governmental Unit Notes do not constitute
a general indebtedness of the Governmental Unit, or a pledge of the faith, credit or taxing power
thereof within the meaning of any constitutional or statutory provision or limitation. Neither the
State of Florida nor any political subdivision thereof nor the Governmental Unit shall be
obligated (1) to exercise its ad valorem taxing power or any other taxing power in any form on
any real or personal property in the territory of the Governmental Unit to pay the principal of the
Series 2009)-1 Loan and the 2009)-1 Governmental Unit Notes, the interest thereon or other
payments or costs incident thereto or under this Loan Agreement, or (2) to pay the same from
any other funds of the Governmental Unit except from the Pledged Revenues, all in the manner
provided herein. The acceptance of the 2009)-1 Governmental Unit Notes by the holders from
time to time thereof shall be deemed an agreement between the Governmental Unit and such
holders that the 2009)-1 Governmental Unit Notes and the indebtedness evidenced thereby shall
not constitute a lien upon any property of the Governmental Unit, but shall constitute a lien only
on the Pledged Revenues, in the manner herein provided. The Series 2009)-1 Loan and the
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2009)-1 Governmental Unit Notes shall not be secured by, nor payable from moneys, Reserve
Account Insurance Policies or Reserve Account Letters of Credit on deposit in, the Reserve
Account.
(e) Subject to the provisions of the Florida Constitution, nothing herein contained
shall preclude the Governmental Unit from using any legally available funds, in addition to the
Fledged Revenues herein provided, which may come into its possession, including but not
limited to the proceeds of the Series 2009)-1 Loan, contributions or grants, for the purpose of
payment of principal of and interest on the Series 2009)-1 Loan, but the Governmental Unit shall
have no obligation to use any such funds except the Pledged Revenues for such purpose.
SECTION 3.7 BENEFIT OF PROGRAM BONDHOLDERS AND CREDIT
ISSUERS; COOPERATION BETWEEN PARTIES.
This Agreement is executed in part to induce the purchase by others of the Program
Bonds, the issuance by any Credit Facility Issuer of a Credit Facility, if any, the issuance of
Local Credit Enhancement, if any, and the execution and delivery by any Liquidity Facility ssuer
of a Liquidity Facility, if any, and, accordingly, all covenants, agreements and representations on
the part of the Governmental Unit and the Sponsor, as set forth in this Agreement, are hereby
declared to be for the benefit of the holders from time to time of the Program Bonds, and for the
benefit of each such Credit Issuer. The Governmental Unit agrees to cooperate to do all things
reasonably appropriate to comply with and to enable the Sponsor to comply with all
requirements and to enable the Sponsor to fulfill all covenants of the Indenture.
SECTION 3.8 PRESERVATION OF TAX-STATUS; PROGRAM BONDS
NOT TO BECOME ARBITRAGE BONDS.
The Governmental Unit shall take no action subsequent to the issuance of the 2009)-1
Governmental Unit Notes which would cause the interest on the Program Bonds to lose the
exemption from federal income tax under Section 103 of the Internal Revenue Code of 1954, as
amended, and in effect prior to the enactment of the Tax Reform Act of 1986, and the regulations
issued thereunder (collectively, the "1954 Code"), as such exemption is carried forward in the
exclusion of such interest from gross income for federal income tax purposes under the Internal
Revenue Code of 1986, as amended, in accordance with Sections 1312 through 1319 of the Tax
Reform Act of 1986.
Except as provided in this Agreement, the Governmental Unit hereby covenants to the
Sponsor and the holders of the Program Bonds that it will neither make nor cause to be made any
investment or other use of the proceeds of the 2009)-1 Governmental Unit Notes which would
cause the Program Bonds to be "arbitrage bonds" under Section 103(c) of the 1954 Code, as
amended, and the regulations issued thereunder, and that it will comply with the requirements of
such Section and regulations throughout the term of the 2009)-1 Governmental Unit Notes, in
accordance with directions received by the Governmental Unit at the time the 2009)-1
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Governmental Unit Notes are made, or such other specific written directions of the Sponsor as
the Governmental Unit may receive so that no investment of the proceeds of the 2009)-1
Governmental Unit Notes would cause the Program Bonds to be "arbitrage bonds" or otherwise
adversely affect the tax-exempt status of the Program Bonds.
The Sponsor shall give the Governmental Unit prompt notice of any investigation or
inquiry by any governmental agency concerning the tax exempt status of the Program Bonds,
and the Governmental Unit shall have the right to have its counsel present and participate in all
meetings, discussions, hearings, negotiations and proceedings with any governmental or
regulatory agency, so far as the Sponsor has the power to permit. The Governmental Unit shall
have no obligation to make any payment (whether as part of the Costs and Expenses of the
Program, Reserve Payments, or otherwise) or take any other corrective action in respect of the
claimed or asserted taxability of the Program Bonds which arises as a result of any action or
omission of another Participating Governmental Unit.
SECTION 3.9 ASSIGNMENT OF SPONSOR'S RIGHTS.
(a) As the source of payment for the Program Bonds, the Sponsor will assign to the
Trustee all the Sponsor's rights under the 2009)-1 Governmental Unit Notes and this Agreement
(except for the rights of the Sponsor, the Trustee, the Administrator and the Independent
Contractor, if applicable to receive reports and indemnity against claims, and the Sponsor's,
Trustee's and Administrator's rights to enforce remedies pursuant to Section 3.5, 4.1, 4.2 and 5.4
hereof). The Governmental Unit will make all payments required under Sections 3.3, 3.4, 3.5
and 5.3 hereof without defense or setoff by reason of any dispute between the Governmental
Unit and the Sponsor.
(b) The Indenture requires that if a Credit Facility is established for the Program
Bonds for payment of the principal of and interest on the Program Bonds when due if other
moneys available under the Indenture are insufficient therefor, the rights to the payment of any
principal and/or interest paid by the Credit Facility Issuer shall be assigned to the Credit Facility
Issuer. Under certain circumstances provided in the Indenture, this Agreement and the 2009)-1
Governmental Unit Notes may be assigned to a Credit Issuer or the issuer of a Local Letter of
Credit, if any.
SECTION 3.10 COVENANT REGARDING PLEDGED REVENUES.
(a) The Governmental Unit hereby covenants to take all lawful action necessary or
required to collect and receive the Pledged Revenues. The Governmental Unit further covenants
that it has full power to pledge the Pledged Revenues to the payment of the principal and interest
and other amounts becoming due on the 2009)-1 Governmental Unit Notes or this Agreement as
described in this Agreement. To the extent that any Bonds may be payable from or secured by
Impact Fees or Special Assessments, the Governmental Unit hereby agrees to apply such fees
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and assessments for the payment of all amounts due on such Bonds to the maximum extent
available and legally permitted, so as to maximize the amount of Net Revenues available to pay
the amounts due in respect of the 2009)-1 Governmental Unit Notes.
(b) Except as otherwise expressly provided herein, all covenants and agreements set
forth in the Original Resolution are applicable to the 2009)-1 Governmental Unit Notes and are
hereby incorporated by reference to the same extent as if set forth in full herein, for the benefit of
the holder of the 2009)-1 Governmental Unit Notes. The Governmental Unit covenants and
agrees hereby that it will only modify or amend the Bond Resolution in accordance with the
provisions of Article X of the Original Resolution, provided that the Governmental Unit will not
modify the Bond Resolution in any manner which would adversely affect the security of the
2009)-1 Governmental Unit Notes or the interests of the Sponsor or the holders of the Program
Bonds, without the express written consent of the Sponsor and the Credit Facility Issuer, if any,
for the Program Bonds.
SECTION 3.11 ALTERNATE SECURITY FOR 2009)-1 GOVERNMENTAL
UNIT NOTES; DEFEASANCE.
The Governmental Unit reserves the right to secure the 2009)-1 Governmental Unit
Notes with a Local Credit Enhancement acceptable in form and substance to the Credit Facility
Issuer, if any, and the Administrator, and upon furnishing such Local Credit Enhancement or
other security, the pledge of and lien upon the Pledged Revenues in favor of the 2009)-1
Governmental Unit Notes shall be released and discharged, in the manner specified in the
Indenture. In addition, the Governmental Unit may defease the lien of this Agreement upon the
Pledged Revenues at any time provided it first provides the following to the Trustee and to the
Credit Facility Issuer, if any:
(a) Evidence that the Governmental Unit shall have paid, or shall have made
provision for payment of, all amounts payable under this Agreement. For purposes of the
preceding sentence, deposit of direct obligations of the United States of America which are not
subject to redemption prior to maturity at the option of the obligor (or, with the written approval
of the Credit Facility Issuer, if any, deposit of any other securities or investments consistent with
the provisions of the Bond Resolution) in irrevocable trust with a banking institution or trust
company, for the sole benefit of the holder of the 2009)-1 Governmental Unit Notes, the
principal of and interest on which will be sufficient to pay when due all payments under this
Loan Agreement, shall be considered "provision for payment".
(b) An opinion of nationally recognized bond counsel acceptable to the Sponsor and
to the Credit Facility Issuer, if any, to the effect that (i) the lien of the Bond Resolution with
respect to the 2009)-1 Governmental Unit Notes upon the Pledged Revenues has been released
and (ii) the transaction resulting in such defeasance does not adversely affect the exemption from
taxation of the interest on the Program Bonds.
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(c) Verification by an independent certified public accountant of the redemption
amount andJor securities to be deposited in escrow pursuant to paragraph (a).
SECTION 3.12 INTERLOCAL AGREEMENT.
This Agreement, together with the 2009)-1 Governmental Unit Notes incorporated by
reference herein, shall be deemed to be an Interlocal Agreement with the Sponsor within the
meaning of Chapter 163, Part I, Florida Statutes, and shall be filed of record in accordance with
the provisions of the Florida Intergovernmental Cooperation Law; that is, it shall be filed with
the Clerks of the Circuit Court for Santa Rosa County and Miami-Dade County, Florida.
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ARTICLE IV
COVENANTS OF THE GOVERNMENTAL UNIT
SECTION 4.1 REPORTS AND OPINIONS; INSPECTIONS.
(a) Until all amounts due under this Agreement have been paid in full, the
Governmental Unit shall deliver to the Sponsor, the Trustee and the Credit Issuers, within thirty
(30) days after the Governmental Unit's receipt thereof, an annual report prepared in accordance
with generally accepted accounting principles applicable to the Governmental Unit, and
accompanied by an audit opinion of an independent certified public accountant (or accounting
firm) reasonably satisfactory to the Sponsor, which shall include a balance sheet and income
statement for the prior Fiscal Year in reasonable detail, and be accompanied by a certificate of
the Governmental Unit stating that no Event of Default hereunder has occurred and is
continuing.
(b) The Governmental Unit shall deliver to the Sponsor, the Credit Facility Issuer, if
any, and the Trustee, not later than the 135th but not earlier than the 128th day following (i) in
the case of a Loan secured by a Local Letter of Credit, the date of each Loan Payment pursuant
to the terms of this Agreement (whether by prepayment or regularly scheduled payment) or (ii)
as to Loans not so secured, within 135 days following the final payment upon the Series 2009)-1
Loan, a certificate of the Governmental Unit, or other evidence in form and substance
satisfactory to the Trustee, to the effect that, during the period ending 128 days following such
payment, no bankruptcy, insolvency or similar proceeding has been commenced by or against
the Governmental Unit and that no other event has occurred which would have constituted an
Event of Default under Section 5.1(f) of this Agreement (except such as has been vacated,
dismissed or discharged by an order which is not subject to further appeal). Notwithstanding the
payment in full of the Series 2009)-1 Loan, the Governmental Unit shall pay any reasonable
charges incurred by the Sponsor or the Trustee in connection with any payment under any Credit
Facility by reason of the Governmental Unit's failure to deliver such certificate or evidence on a
timely basis. In addition, notwithstanding the payment in full of the Series 2009)-1 Loan, the
Governmental Unit shall pay to any Substitute Credit Facility Issuer an amount, if any, equal to
the Credit Issuer Rate per annum on the amount which was disbursed under any Credit Facility
by reason of any payment of the Governmental Unit's Series 2009)-1 Loan payment to the
holders of the Program Bonds being deemed a Preference Payment (as defined in the Indenture),
for the period between the disbursement of such amount under the Credit Facility and the
repayment of such amount by the Governmental Unit.
(c) The Governmental Unit agrees to permit the Sponsor, the Trustee and the Credit
Issuers to examine, visit and inspect, at any reasonable time at the Governmental Unit's location,
any accounts, books and records, including its receipts, disbursements, contracts, investments
and any other matters relating to the Pledged Revenues thereto and to its financial standing, to
the extent the same reasonably relate to the Pledged Revenues and the Series 2009)-1 Loan and
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to supply such reports and information as the Sponsor, the Trustee or the Credit Issuers may
reasonably require in connection with any of the foregoing, or to enable the Sponsor to comply
with any governmental or regulatory requirement relating to the Program or the Program Bonds;
provided, however, that if any securities law disclosure requirement (including, without limitation,
Rule lOb-5 and Rule 15c2-12 under the Securities Exchange Act of 1934) is occasioned by a Loan
to another Governmental Unit under the Program, the cost of providing such disclosure relating to
another Governmental Unit shall be borne by the Program or such subsequent Participant and not
by the Governmental Unit.
(d) The obligations of the Governmental Unit to make any payments to the Sponsor
in respect of fees, expenses, reimbursements or costs incurred by the Sponsor in connection
herewith or with the 2009)-1 Governmental Unit Notes under the provisions of this Agreement,
shall survive any defeasance or payment of the 2009)-1 Governmental Unit Notes and shall be
promptly paid upon demand by the Sponsor. Until so paid, such amounts shall be secured by the
Pledged Revenues in the same manner as provided herein for the 2009)-1 Governmental Unit
Notes.
SECTION 4.2 IMMUNITY OF SPONSOR.
In the exercise of the powers of the Sponsor and its members, officers, employees and
agents under the Indenture or this Agreement including (without limiting the foregoing) the
application of moneys and the investment of funds, the Sponsor shall not be accountable to the
Governmental Unit for any action taken or omitted with respect to the facilities financed with
proceeds of the Refunded Bonds, the Series 2009 Project or this Agreement by it or its members,
officers, employees and agents in good faith and believed by it or them to be authorized or within
the discretion or rights or powers conferred under this Agreement. The Sponsor and its members,
officers, employees and agents shall be protected in its or their acting upon any paper or
documents believed by it or them to be genuine, and it or they may in good faith rely upon the
advice of counsel selected by them with reasonable care and may (but need not) require further
evidence of any fact or matter before taking any action. No recourse shall be had by the
Governmental Unit for any claims based on the Indenture or this Agreement against any
member, officer, employee or agent of the Sponsor alleging personal liability on the part of such
person unless such claims are based upon the gross negligence, willful misconduct, bad faith,
fraud or deceit of such person. To the extent permitted by law the Governmental Unit shall
indemnify the Sponsor and any of its members, officers, employees or agents and save them
harmless against any liability intended to be precluded by this Section resulting from the breach
of this Agreement by the Governmental Unit and not caused by the negligence or willful
misconduct of such parties.
SECTION 4.3 COMPLIANCE WITH LAWS.
With respect to the Financing Program, the Governmental Unit will at all times comply
with all applicable requirements of federal and state laws and with all applicable lawful
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requirements of any agency, board, or commission created under the laws of the State of Florida
or of any other duly constituted public authority; provided, however, that the Governmental
Unit shall be deemed in compliance with this Section 4.3 so long as it is contesting in good faith
any such requirement by appropriate legal proceedings.
SECTION 4.4 ISSUANCE OF OTHER OBLIGATIONS PAYABLE FROM
PLEDGED REVENUES.
So long as the 2009)-1 Governmental Unit Notes remain Outstanding and unpaid, the
Governmental Unit will not hereafter issue or consent to the issuance of any other obligations
payable from the Pledged Revenues or any portion thereof, nor voluntarily create any debt, lien,
pledge, assignment, encumbrance or other charge, having priority to or being on a parity with the
lien of the 2009)-1 Governmental Unit Notes and the interest and other amounts due thereon,
upon the Pledged Revenues, except under the conditions and in the manner provided for
Additional Indebtedness in the Bond Resolution.
SECTION 4.5 RESERVED.
SECTION 4.6 ADDITIONAL COVENANTS.
(a) INCORPORATION. The provisions, covenants and conditions of the Original
Resolution are hereby incorporated herein to the extent not inconsistent herewith for the benefit
of the 2009)-1 Governmental Unit Notes, and the Governmental Unit hereby covenants that so
long as any amounts hereunder or in respect of the 2009)-1 Governmental Unit Notes remain
unpaid, it will not repeal, modify or amend the Bond Resolution except as permitted under the
Bond Resolution and Section 3.10(b) hereof. The covenants and provisions of the Original
Resolution shall be deemed applicable to this Agreement, and shall apply to this Loan
Agreement as if fully restated herein.
The 2009)-1 A Governmental Unit Note and the 2009)-1 B Governmental Unit Note shall
be "Refunding Bonds" under the Bond Resolution and the 2009)-1 C Governmental Unit Note
shall be "Additional Bonds" under the Bond Resolution, and each shall be entitled to the rights
and privileges accorded to "Bonds" under the Bond Resolution, except to the extent expressly set
forth in this Section 4.6. The 2009)-1 Governmental Unit Notes shall be entitled to the same
benefits and security under the Bond Resolution as all other Bonds issued under the Bond
Resolution. The Governmental Unit shall increase the deposits of Net Revenues into the funds
and accounts under the Bond Resolution, including, without limitation, the Bond Service
Subaccount [and Redemption Subaccount] of the Debt Service Account, but not the Reserve
Account, to provide for the payment of the amounts due under the 2009)-1 Governmental Unit
Notes on a parity with the Parity Bonds and the Parity Notes. The principal and interest of the
2009)-1 Governmental Unit Notes shall be payable from the Bond Service Subaccount [and
Redemption Subaccount] of the Debt Service Account established under the Original Resolution,
on a parity with the Parity Bonds, the Parity Notes and, to the extent payable from the Bond
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Service Subaccount [or the Redemption Subaccount,] any Additional Indebtedness hereafter
issued in accordance with the provisions of the Bond Resolution and payments shall be made
into the Bond Service Subaccount [and Redemption Subaccount] of the Debt Service Account by
the Governmental Unit in amounts fully sufficient to pay the principal of and interest on the
Parity Bonds, the 2009)-1 Governmental Unit Notes, the Parity Notes and, to the extent payable
from the Bond Service Subaccount [or the Redemption Subaccount,] any Additional
Indebtedness hereafter issued in accordance with the provisions of the Bond Resolution. The
Series 2009)-1 Loan and the 2009)-1 Governmental Unit Notes shall not be secured by, nor
payable from moneys, Reserve Account Insurance Policies or Reserve Account Letters of Credit
on deposit in, the Reserve Account.
(b) NO PRIVATE USE. The Governmental Unit will take no action, or permit or
suffer any action or event, which will cause the Program Bonds to bean "Industrial Development
Bonds" or a "Consumer Loan Bond" within the meaning of the 1954 Code, as amended, or a
Private Activity Bond within the meaning of the Internal Revenue Code of 1986, as amended, to
the extent applicable, if any, to the Program Bonds, unless the Governmental Unit shall have
received a Favorable Opinion of Bond Counsel regarding such action or event. THE
GOVERNMENTAL UNIT ACKNOWLEDGES THAT NO DE MINIMUS AMOUNT OF
PRIVATE BUSINESS USE IS PERMITTED TO BE MADE OF THE FACILITIES
REFINANCED WITH THE PROCEEDS OF THE PROGRAM BONDS.
(c) PERMITTED USE. The Governmental Unit will comply with the covenants and
representations set forth in Section 1.2 hereof in connection with its ownership and operation of
the facilities financed with proceeds of the Refunded Bonds and the Series 2009 Project. The
Governmental Unit hereby represents and agrees that the proceeds of the Refunded Bonds have
been expended only to pay the costs of the project financed with proceeds of such Refunded
Bonds, including costs of issuance of the Refunded Bonds, which project has been or will at all
times be owned and operated by the Governmental Unit. The Governmental Unit hereby agrees
that the proceeds of the Series 2009)-1C Loan will be expended only to pay the Costs of the
Series 2009 Project, which Series 2009 Project, as well as the facilities financed with proceeds of
the Refunded Bonds, will at all times be owned and operated by the Governmental Unit. The
Governmental Unit may from time to time permit the facilities financed with proceeds of the
Refunded Bonds and the Series 2009 Project or portions thereof to be leased to or managed by
any private or public entity provided that the Governmental Unit shall have furnished to the
Administrator, the Sponsor and the Trustee a favorable Opinion of Bond Counsel as to such lease
or management. The Governmental Unit shall not allow the facilities financed with proceeds of
the Refunded Bonds or the Series 2009 Project to be used in the trade or business of any private
person unless the Governmental Unit shall furnish to the Sponsor and the Trustee a Favorable
Opinion of Bond Counsel with respect to such use.
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ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
SECTION 5.1 EVENTS OF DEFAULT.
Each of the following events is hereby defined as, and declared to be and shall constitute,
an "Event of Default":
(a) failure by the Governmental Unit to make any payment required to be made
pursuant to Section 3.3(a) hereof on or before the date the same is due provided notice of such
amount has been given as provided herein; or
(b) failure by the Governmental Unit to make any payment required to be made
pursuant to any other provision hereof within thirty (30) days after the same is due and notice
thereof has been furnished to the Governmental Unit; or
(c) with the exceptions of those covenants set forth in Section 3.3 hereof, failure by
the Governmental Unit to perform any other covenant, condition or agreement on its part to be
observed or performed under this Agreement for a period of thirty (30) days after written notice
specifying such failure and requesting that it be remedied is given to the Governmental Unit by
the Sponsor, the Credit Facility Issuer, if any, or the Trustee; provided, however, that if such
failure cannot reasonably be corrected within such thirty (30) day period, upon approval of the
Sponsor (which shall be granted if the Sponsor reasonably believes the failure can be cured
within 180 days), the Governmental Unit shall not be deemed to have committed an Event of
Default under this paragraph if it commences to cure such failure within such thirty (30) day
period and thereafter pursues the curing thereof with diligence; or
(d) if any of the representations, warranties or certifications of the Governmental Unit
under Section 1.2 hereof or otherwise made or delivered by the Governmental Unit in connection
herewith shall prove to be false or misleading in any material respect; or
(e) (1) the Governmental Unit shall make an assignment for the benefit of
creditors; (2) the Governmental Unit shall apply for or seek, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any substantial part of its
property; (3) the Governmental Unit shall fail to file an answer or other pleading denying the
material allegations of any proceeding filed against it seeking to have the Governmental Unit
adjudicated as bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of the Governmental Unit or its debts
under any law relating to bankruptcy or insolvency; (4) the Governmental Unit shall take any
action to authorize or effect any of the actions set forth in Sections 5.1(e)(1) or (2); or
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(fj (1) the Governmental Unit shall be adjudicated a bankrupt or become subject to
an order for relief under federal bankruptcy law; (2) the Governmental Unit shall institute any
proceedings seeking an order for relief under federal bankruptcy law or seeking to be adjudicated
a bankrupt or insolvent, or seeking dissolution, winding up, liquidation, reorganization,
arrangement, adjustment or composition of it or its debts under any law relating to bankruptcy or
insolvency; or (3) without the application, approval or consent of the Governmental Unit, a
receiver, trustee, examiner, liquidator or similar official shall be appointed for the Governmental
Unit, or a proceeding described in Section 5.1(e)(3) shall be instituted against the Governmental
Unit and such appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of ninety (90) consecutive days; the mere declaration by the Governmental
Unit of a state of financial emergency under Section 218.503, Florida Statutes, as amended, shall
not, in and of itself, constitute a default under this Section 5.1(f); or
(g) if a Local Letter of Credit has been provided with respect to the Series 2009)-1
Loan, the failure of the Governmental Unit to provide a replacement for any such Local Letter of
Credit, which replacement has been approved in writing by the Sponsor, by the 15th day prior to
the expiration or non-renewal of the existing Local Letter of Credit.
SECTION 5.2 ACCELERATION.
If an Event of Default as defined in Section 5.1(a), (b), (e) or (f) hereof shall have
occurred, or upon the 10th day prior to the expiration, termination, or non-renewal of a Local
Letter of Credit if any pursuant to Section 5.1(g) hereof, the Series 2009)-1 Loan, and all other
sums which the Governmental Unit is obligated to pay under this Agreement shall, upon
direction of the Sponsor, become due and payable immediately, and the Commitment shall
terminate, without further notice to the Governmental Unit; provided, however, that no such
acceleration may occur until such time as Bonds Outstanding under the Bond Resolution are
accelerated under the provisions of the Bond Resolution. If any other Event of Default shall
have occurred, the Trustee (as the Sponsor's assignee, or any assignee of the Trustee or Co-
Trustee, as may be the case) shall, but only upon direction of the Sponsor, by notice in writing to
the Governmental Unit, declare the Series 2009)-1 Loan and all other sums which the
Governmental Unit is obligated to pay hereunder to be due and payable immediately. Upon any
such acceleration whether automatically or by declaration, anything in this Agreement contained
to the contrary notwithstanding, there shall become immediately due and payable, in addition to
any other amounts then due from the Governmental Unit hereunder, the sum of (i) the
outstanding principal amount of the Series 2009)-1 Loan; (ii) accrued and unpaid interest on the
Series 2009)-1 Loan; and (iii) any amount payable in excess of the sum of: (x) the unpaid
principal balance of the 2009)-1 Governmental Unit Notes plus (y) accrued and unpaid interest
thereon and provided that there shall be no double counting of amounts due hereunder and under
such Sections.
Notwithstanding the foregoing, it is hereby agreed that neither the 2009)-1 Governmental
Unit Notes nor this Agreement shall be accelerated so long as any other Bonds are Outstanding
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under the Bond Resolution, unless all such other Outstanding Bonds are also accelerated under
the provisions of the Bond Resolution.
SECTION 5.3 PAYMENT OF SERIES 2009)-1 LOAN ON DEFAULT; SUIT
THEREFOR.
(a) The Governmental Unit covenants that, in case an Event of Default shall occur in
the payment of any sum payable by the Governmental Unit under Section 3.3 of this Loan
Agreement as and when the same shall become due and payable, whether at maturity or by
acceleration or otherwise, then, upon demand of the Sponsor, the Credit Facility Issuer, if any, or
the Trustee, but only upon direction of the Sponsor, the Governmental Unit will pay to the
Trustee (or its assignee) an amount equal to the sum of: (i) the amount described in Section 5.2
hereof; and (ii) any other amounts which the Governmental Unit is obligated to pay under this
Agreement; and (iii) such further amount as shall be sufficient to cover the reasonable costs and
expenses of collection, including a reasonable compensation to the Sponsor and the Trustee, and
any agents, employees, officials, attorneys and counsel of the Trustee or the Sponsor.
(b) In case the Governmental Unit shall fail forthwith to pay such amounts upon such
demand, the Sponsor or the Trustee (or its assignee) shall be entitled and empowered but only
upon direction of the Sponsor, to institute any actions or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any such action or proceeding to
judgment or final decree, and may enforce any such judgment or final decree against the
Governmental Unit and collect in the manner provided by law.
(c) In case any proceedings shall be pending for the bankruptcy or for the
reorganization of the Governmental Unit under the federal bankruptcy laws or any other
applicable law, or in case a receiver or trustee shall have been appointed for the property of the
Governmental Unit, or in case any other similar judicial proceedings shall be pending relating to
the Governmental Unit or to the creditors or property of the Governmental Unit, the Trustee (or
its assignee) shall be entitled and empowered, to the extent permitted by law, by intervention in
such proceedings or otherwise, to file and prove a claim or claims for the whole amount of the
Series 2009)-1 Loan made to the Governmental Unit pursuant to this Loan Agreement and for
interest owing and unpaid in respect thereof and to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to prosecute the claims of the Trustee (or
its assignee) in any such judicial proceedings relating to the Governmental Unit, its creditors, or
its property, and to collect and receive any moneys or other property payable or deliverable on
any such claims, and to distribute the same after the deduction of its charges and expenses. Any
receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized to make such
payments to the Trustee (or its assignee), and to pay to the Trustee (or its assignee) any amount it
requires for reasonable compensation and expenses, including reasonable counsel fees it has
incurred up to the date of such distribution in connection with the Series 2009)-1 Loan.
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SECTION 5.4 OTHER REMEDIES.
(a) Whenever any Event of Default hereunder shall have occurred and be continuing,
whether or not all sums which the Governmental Unit is obligated to pay under this Agreement
shall have been declared to be immediately due and payable pursuant to this Agreement, the
Sponsor or the Trustee (or its assignee) shall, but only if directed by the Sponsor, take whatever
action at law or in equity as may appear necessary or desirable to collect the amounts payable by
the Governmental Unit hereunder, then due and thereafter to become due, or to enforce
performance and observance of any obligation, agreement or covenant of the Governmental Unit
under this Agreement, including the application of any undisbursed Series 2009)-1 Loan
proceeds to the reduction of the outstanding balance of such Series 2009)-1 Loan.
(b) Whenever any Event of Default hereunder shall have occurred and be continuing,
before or after declaring an acceleration pursuant to Section 5.2 hereof, the Sponsor or the
Trustee (or its assignee) may, but shall not be obligated to, perform for the account of the
Governmental Unit any covenant or obligation in the performance of which the Governmental
Unit is in default, in which event the Governmental Unit shall immediately reimburse the
Sponsor or the Trustee (or its assignee), as the case may be, upon demand for all reasonable
expenses incurred by the Sponsor or the Trustee (or its assignee), as the case may be, in the
course of such performance, including reasonable counsel fees, with interest from the date of
such expenditure at the Prime Rate then in effect.
(c) No action taken pursuant to this Section 5.4 shall relieve the Governmental Unit
from its obligations pursuant to Sections 3.3, 3.5 and 5.3 hereof, all of which shall survive any
such action. The Sponsor or the Trustee (or its assignee) may, and upon direction of the Credit
Facility Issuer, shall take whatever action at law or in equity as may appear necessary and
desirable to collect the amounts then due and thereafter to become due from the Governmental
Unit, or to enforce the performance and observance of any obligation, agreement or covenant of
the Governmental Unit hereunder.
(d) Except as to the Sponsor's rights to indemnity and reports from the Governmental
Unit hereunder, the Sponsor's right to enforce the remedies described in this Section 5.4 shall not
be exclusive, and the Credit Facility Issuer, if any, and the Trustee shall also have the right to
enforce these remedies.
SECTION 5.5 CUMULATIVE RIGHTS.
No remedy conferred upon or reserved to the Sponsor, the Credit Facility Issuer, if any,
or the Trustee (or its assignee) by this Agreement is intended to be exclusive of any other
available remedy or remedies, but each and every such remedy shall be cumulative and shall be
in addition to every other remedy given under this Agreement or now or hereafter existing at law
or in equity or by statute. No waiver by the Sponsor, the Credit Facility Issuer, if any, or the
Trustee (or its assignee) of any breach by the Governmental Unit of any of its obligations,
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agreements or covenants hereunder shall be deemed a waiver of any subsequent breach, or a
waiver of any other obligation, agreement or covenant, and no delay or failure by the Sponsor,
the Credit Facility Issuer, if any, or the Trustee (or its assignee) to exercise any right or power
shall impair any such right or power or shall be construed to be a waiver thereof, but any such
right and power may be exercised by the Sponsor, the Credit Facility Issuer, if any, or the
Trustee (or its assignee) from time to time and as often as may be deemed expedient.
SECTION 5.6 DISCONTINUANCE OF PROCEEDINGS.
In case the Sponsor, the Credit Facility Issuer, if any, or the Trustee (or its assignee) shall
have proceeded to enforce any right under this Agreement and such proceedings shall have been
discontinued or abandoned for any reason or shall have been determined adversely to the
Sponsor, the Credit Facility Issuer, if any, or the Trustee (or its assignee), then and in every such
case the Governmental Unit, the Sponsor, the Credit Facility Issuer, if any, and the Trustee (or its
assignee) shall be restored respectively to their several positions and rights hereunder, and all
rights, remedies and powers of the Governmental Unit, the Sponsor, the Credit Facility Issuer, if
any, and the Trustee (or its assignee) shall continue as though no such proceeding had been
taken, subject to any such adverse determination.
SECTION 5.7 NOTICE OF DEFAULT.
The Governmental Unit shall give the Trustee, any Credit Facility Issuer, any Liquidity
Facility Issuer, each Local Credit Enhancement Issuer or provider of any Local Letter of Credit
and the Sponsor, a prompt written notice of any condition or occurrence which constitutes an
Event of Default under Section 5.1 hereof immediately upon becoming aware of the existence
thereof.
SECTION 5.8 LIMITATION UPON REMEDIES AND ENFORCEMENT.
Notwithstanding any provision in this Loan Agreement or in the 2009)-1 Governmental
Unit Notes, neither the Sponsor, the Trustee nor the Credit Facility Issuer, if any, shall have the
right to enforce any provision hereof, or of the 2009)-1 Governmental Unit Notes, or to exercise
any remedy hereunder, except to the extent that such enforcement or remedy is permitted to be
exercised by the Holder of the 2009)-1 Governmental Unit Notes under the Bond Resolution. In
the event that the exercise of remedies or enforcement of rights is so limited at any time, the
Credit Facility Issuer, if any, shall have the right to direct the Trustee to submit, prosecute and
pursue claims for payment of all amounts due from the Governmental Unit hereunder or on the
2009)-1 Governmental Unit Notes, and to otherwise direct the pursuit of all available remedies,
but only in the manner and to the extent permitted or provided for Bondholders under the Bond
Resolution. While a Credit Facility Issuer shall be in payment default under its Credit Facility
during the pendency of any such default by the Governmental Unit, such Provider shall have no
right to direct the actions of the Trustee regarding enforcement of the Series 2009)-1 Loan or the
2009)-1 Governmental Unit Notes, and the Trustee shall enforce this Agreement and the 2009)-1
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Governmental Unit Notes for the benefit of the Sponsor and the holders of the Program Bonds, at
the direction of the Sponsor, having due regard for the interests of the holders of Program Bonds,
all in the same manner as may be permitted for Holders of the 2009)-1 Governmental Unit Notes
under the Bond Resolution.
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ARTICLE VI
MISCELLANEOUS
SECTION 6.1 LIMITATION OF LIABILITY.
In the event of any default by the Sponsor hereunder, the liability of the Sponsor or the
Credit Facility Issuer, if any, to the Governmental Unit shall be enforceable only out of the
moneys available under the Indenture and there shall be no other recourse for damages by the
Governmental Unit against the Sponsor, the Credit Facility Issuer, if any, its officers, members,
agents and employees, or against any of the property now or hereafter owned by it or them.
Notwithstanding any other provisions of this Loan Agreement to the contrary, in the
event of any default by the Governmental Unit hereunder or under the 2009)-1 Governmental
Unit Notes, the liability of the Governmental Unit shall be enforceable only out of the Pledged
Revenues, and there shall be no other recourse for damages by the Sponsor or the Credit Facility
Issuer, if any, against the Governmental Unit, its officers, members, agents and employees.
SECTION 6.2 NO PERSONAL RECOURSE.
Neither any member nor any officer, employee or agent of the Governmental Unit nor
any person executing this Agreement or 2009)-1 Governmental Unit Notes shall be personally
liable on the Series 2009)-1 Loan, the Program Bonds, the Indenture or this Agreement by
reason of the issuance thereof.
SECTION 6.3 NOTICES.
Notice hereunder shall be effective upon receipt and shall be given by certified mail,
return receipt requested, to:
As to the Sponsor:
City Manager
City of Gulf Breeze
1070 Shoreline Drive
Gulf Breeze, Florida 32561
and
Gulf Breeze Financial Services
Attn: Executive Director
315 Fairpoint Drive
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Gulf Breeze, Florida 32561
As to the Trustee:
U.S. Bank National Association
225 E. Robinson Street, Suite 250
Orlando, Florida 32801
Attn: Corporate Trust
As to the Governmental Unit:
City of Miami Beach, Florida
1700 Convention Center Drive
Miami Beach, Florida 33139
Attn: Chief Financial Officer
cc: City Attorney
SECTION 6.4 ILLEGAL OR INVALID PROVISIONS DISREGARDED.
In case any provision of this Agreement shall for any reason be held invalid, illegal or
unenforceable in any respect, this Agreement shall be construed as if such provision had never
been contained herein.
SECTION 6.5 APPLICABLE LAW.
This Loan Agreement shall be deemed to be a contract made in Florida and governed by
Florida law.
SECTION 6.6 ASSIGNMENTS.
The Governmental Unit shall not assign this Agreement or any interest of the
Governmental Unit herein, either in whole or in part. The Administrator on behalf of the
Sponsor hereby assigns this Loan Agreement and the 2009)-1 Governmental Unit Notes attached
hereto to the Trustee as provided in Section 3.9 hereof. Except as provided in Section 3.9 hereof
this Agreement shall be binding upon and shall inure to the benefit of the successors and assigns
of the parties hereto.
On December 1, 2020, and with respect to the Series 2009)-1B Loan and the Series
2009)-1 C Loan, including the 2009)-1 B Governmental Unit Note and the 2009)-1 C
Governmental Unit Note, the parties hereto acknowledge that the Trustee will assign all of its
rights thereunder to U.S. Bank National Association, trustee under an Indenture of Trust dated as
of December 1, 2009 (the "2009 Indenture") to secure the Cross-Over Bonds. Thereafter, all
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references to the Program Bonds shall be deemed to refer to the Cross-Over Bonds, and the
provisions of the 2009 Indenture shall be deemed to have replaced the corresponding provisions
of the Indenture.
SECTION 6.7 AMENDMENTS.
This Agreement may not be amended except by an instrument in writing signed by the
parties and with the consent of each provider of a Local Letter of Credit, if any, and the Credit
Facility Issuer, if any, and with consent of the Trustee if required by Section 8.03 of the
Indenture.
SECTION 6.8 TERM OF AGREEMENT.
This Agreement and the respective obligations of the parties hereto shall be in full force
and effect from the date hereof until the principal of and all interest on the Series 2009)-1 Loan
shall have been paid in full and the Governmental Unit shall have complied with Section 4.1(b)
hereof.
SECTION 6.9 HEADINGS.
The captions or headings in this Agreement are for convenience of reference only and
shall not control or affect the meaning or construction of any provision hereof.
SECTION 6.10 NOTICE OF EXPECTATION OF OBLIGATION TO MAKE
CERTAIN PAYMENTS.
The Administrator shall promptly notify the Governmental Unit by telephone, followed
by written notice, whenever earnings. are reasonably expected to result in the Governmental
Unit's obligation to make a Reserve Payment.
SECTION 6.11 ENTIRE AGREEMENT.
This Agreement is the entire final agreement between the respective parties with respect
to the Series 2009)-1 Loan. This Agreement incorporates provisions of the Indenture only to the
extent expressly set forth in this Agreement, and this Agreement shall supersede all other
agreements either written or oral between such parties with respect to the Series 2009)-1 Loan.
SECTION 6.12 LIMITATION OF INVESTMENT EARNINGS CREDIT.
The Sponsor has reserved the right to determine the extent to which investment income
on the other funds established under the Indenture (including any income from the Project Loan
Fund) may be applied in determining the amount payable hereunder. The Governmental Unit
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will not receive as a credit against any payment due hereunder any amount of actual earnings on
the proceeds of the Reserve Bonds, in excess of (a) fees and charges for any Liquidity Facility
and Remarketing Agent in respect of the Reserve Bonds, (b) fees of the Trustee, Bond Registrar
and Paying Agent, and other applicable Costs and Expenses of the Program, and (c) interest on
such Reserve Bonds. If such earnings are not sufficient to provide a credit for the items listed in
(a) through (c) of the foregoing sentence, such earnings shall be applied in the priority in which
such items are described, from (a) to (c).
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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have
caused this Agreement to be executed and delivered as of the date first written above.
CITY OF GULF BREEZE, FLORIDA
By:
Mayor, City of Gulf Breeze,
Administrator
WITNESS:
By:
Print Name:
By:
Print Name:
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CITY OF MIAMI BEACH, FLORIDA
(SEAL)
ATTEST:
By:
City Clerk
Approved as to form:
By:
Its: City Attorney
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By:
Mayor
City of Miami Beach, Florida
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U.S. BANK NATIONAL ASSOCIATION
as Trustee
By:
Vice President
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STATE OF FLORIDA
COUNTY OF SANTA ROSH
I, a Notary Public in and for the said County in the State
aforesaid, do hereby certify that Beverly Zimmern, personally known to me to be the same
person whose name is as Mayor of the City of Gulf Breeze, Florida, and Administrator of the
Sponsor's Program Bonds, subscribed to the foregoing instrument, appeared before me this day
in person and severally acknowledged that she, being thereunto duly authorized, signed in the
presence of two subscribing witnesses and delivered the said instrument as the free and voluntary
act of said officers and as her own free and voluntary act, for the uses and purposes therein set
forth and took an oath.
Given under my hand and notarial seal this day of December, 2009.
(SEAL)
Notary Public
My Commission Ends:
Name:
Personally Known or
Produced Identification Address:
Type of Identification
Produced
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STATE OF FLORIDA
COUNTY OF MIAMI-DADE
I, , a Notary Public in and for the said County in
the State aforesaid, do hereby certify that Matti Herrera Bower and Robert Parcher, personally
known to me to be the same persons whose names are, respectively as Mayor and City Clerk of
the City of Miami Beach, Florida, subscribed to the foregoing instrument, appeared before me
this day in person and severally acknowledged that they, being thereunto duly authorized, signed,
sealed with the seal of said city, and delivered the said instrument as the free and voluntary act of
said city and as their own free and voluntary act, for the uses and purposes therein set forth and
took an oath.
Given under my hand and notarial seal this day of December, 2009.
(SEAL)
Personally Known or
Produced Identification
Type of Identification
Produced
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By:
Notary Public
My Commission Ends:
Name:
Address:
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STATE OF FLORIDA
COUNTY OF ORANGE
I, , a Notary Public in and for the said County in
the State aforesaid, do hereby certify that ,personally known to me
to be the same person whose name is, as of U.S. Bank National
Association, subscribed to the foregoing instrument, appeared before me this day in person and
acknowledged that she, being thereunto duly authorized, signed and delivered the said instrument
as the free and voluntary act of said Bank and as their own free and voluntary act, for the uses
and purposes therein set forth and took an oath.
Given under my hand and notarial seal this day of December, 2009.
(SEAL)
Personally Known or
Produced Identification
Type of Identification
Produced
By:
Notary Public
My Commission Ends:
Name:
Address:
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EXHIBIT "A-1"
FORM OF 2009)-lA GOVERNMENTAL UNIT NOTE
R-1
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE REFUNDING BOND
TAXABLE SERIES 2009)-lA
Maturity Date Interest Rate Original Issue Date
December 1, % December 1, 2009
Registered Holder: U.S. Bank National Association, as Trustee
Principal Amount:
For value received, the City of Miami Beach, Florida (the "Governmental Unit"), a
municipal corporation of the State of Florida, hereby promises to pay to the Registered Holder
shown above, as assignee of the Sponsor (as hereafter defined), or to the Credit Facility Issuer, if
any, as its assignee, solely from the Pledged Revenues hereafter mentioned, on the Maturity Date
shown above the Principal Amount shown above, and to pay, solely from such sources, interest
thereon from the Original Issue Date shown above at the Interest Rate per annum shown above
on each June 1 and December 1, commencing June 1, 2010.
In addition to such amounts, the actual amounts due in repayment of the Series 2009)-1 A
Loan (hereafter defined) shall also include certain amounts described in the Loan Agreement of
even date herewith (the "Loan Agreement") between and among the City of Gulf Breeze, Florida
(the "Sponsor"), the Governmental Unit and U.S. Bank National Association, as successor
Trustee, the provisions of which are incorporated herein by reference, including, without
limitation, as provided in Section 3.3 of the Loan Agreement, the Reserve Payment (as such term
is defined in the Loan Agreement), if such Reserve Payment shall be due pursuant to the
provisions of Section 3.5 of the Loan Agreement.
Any payment required to be made with respect to the Series 2009)-1 A Loan which is
received later than its due date shall bear interest from such due date at a rate equal to the higher
of the rate of interest on this Bond or the Prime Rate, plus two per centum per annum (the
"Default Rate"). In addition, if an acceleration of the Series 2009)-lA Loan is declared pursuant
to Section 5.2 of the Loan Agreement following an Event of Default pursuant to the Loan
A-1-1
Agreement, the interest rate on this Bond shall be increased to the Default Rate, and certain
additional amounts shall be payable, as provided in said Section 5.2.
All amounts payable hereunder shall be payable at the designated office of U.S. Bank
National Association, Orlando, Florida, as Bond Registrar for the Governmental Unit. As
provided in the Loan Agreement, the final scheduled payment of principal on the Series 2009J-
1 A Loan (as hereinafter defined) shall be due and payable to the Trustee not less than three
Business Days prior to such final scheduled payment date.
As set forth in the Loan Agreement, a default of the Governmental Unit may also result
in a requirement that the Governmental Unit make certain additional payments with respect to a
portion of the Debt Service Reserve Fund, as defined in the Loan Agreement.
Notwithstanding anything otherwise contained in this Bond, the interest rate on this Bond
and other amounts payable by the Governmental Unit under the Loan Agreement that are treated
as interest under applicable law, shall not exceed the Maximum Rate as defined in the Loan
Agreement; provided, that, in the event the imposition of such Maximum Rate shall ever cause
the amount payable on this Bond to be less than the amount of interest which would otherwise be
computed pursuant to the Loan Agreement, this Bond shall thereafter bear interest at the
Maximum Rate until the earlier of (1) the final maturity of this Bond or (2) such time as the total
amount of interest paid on this Bond shall at such rate equals the amount of interest which would
have been payable on this Bond without regard to any Maximum Rate.
All payments made hereunder shall be applied first to payment of accrued interest on the
unpaid principal balance hereof at the aforesaid rate, and then to reduction of principal and
payment of other amounts due hereunder. In the event the full amount of this Bond is not
disbursed, the payments of principal due hereunder shall be reduced ratably to reflect such
reduction in the principal amount due hereunder.
This Bond is one of a series of bonds designated "Water and Sewer Revenue Refunding
Bonds, Taxable Series 2009)-lA," (the "Series 2009)-lA Bonds") issued by the Governmental
Unit in the aggregate principal amount of $[__] to evidence an obligation to repay a loan
(the "Series 2009)-lA Loan" and together with the Series 2009)-1B Loan and the Series 2009J-
1CLoan, defined below, the "Series 2009)-1 Loan") made to the Governmental Unit pursuant to
the Loan Agreement, to refund, together with other available moneys, a portion of the
Governmental Unit's Water and Sewer Revenue Bonds, Series 2000 (the "2000 Bonds") (the
"Series J-lA Refunding Program"). Simultaneously with the issuance of the Series 2009)-lA
Bonds, the Governmental Unit is issuing its Water and Sewer Revenue Refunding Bonds,
Taxable Series 2009)-1B (the "Series 2009)-1B Bonds"), in the aggregate principal amount of
$[~, to evidence an obligation to repay a loan (the "Series 2009)-1B Loan") made to the
Governmental Unit pursuant to the Loan Agreement to refund, together with other available
moneys, an additional portion of the 2000 Bonds (together with the Series J-lA Refunding
Program, the "Refunding Program"). Simultaneously with the issuance of the Series 2009)-lA
Bonds and the Series 2009)-1B Bonds, the Governmental Unit is also issuing its Water and
Sewer Revenue Bonds, Taxable Series 2009)-1 C (the "Series 2009)-1 C Bonds"), in the
aggregate principal amount of $~~ to evidence an obligation to repay a loan (the "Series
A-1-2
2009)-1 C Loan") made to the Governmental Unit pursuant to the Loan Agreement to finance,
together with other available moneys, the cost of making certain capital improvements to its
Water and Sewer Utility (together with the Refunding Program, the "Financing Program")
This Bond is issued under and pursuant to Resolution No. 95-21585 adopted by the
Mayor and City Commission of the Governmental Unit on May 17, 1995, as amended and
supplemented, and Resolution No. 2009- adopted by the Mayor and City Commission of
the Governmental Unit on October 14, 2009 (collectively, the "Resolution"). The Series 2009)-1
Loan is being made by the Sponsor, from the proceeds of its Local Government Loan Program
Floating Rate Demand Revenue Bonds, Series 1985) (the "Program Bonds"). The Program
Bonds are issued under a Trust Indenture dated as of December 1, 1985, as amended and restated
as of July 1, 1986, as further amended and supplemented, between the Sponsor and U.S. Bank
National Association, as successor Trustee, and as particularly amended and supplemented by a
Nineteenth Supplemental Trust Indenture dated as of December 1, 2009 (collectively, the
"Indenture").
The obligations of the Governmental Unit hereunder are limited, special obligations
payable solely from the Pledged Revenues as provided, and subject to the limitations contained,
in the Loan Agreement and the Resolution. This Bond and the Series 2009)-lA Bonds of which
it is a part, are secured pari-passu by a lien upon and pledge of the Pledged Revenues in the
manner provided in the Resolution, with the Parity Bonds, the Parity Notes, the Series 2009)-1B
Bonds and the Series 2009)-1 C Bonds, as more fully described in the Loan Agreement.
This Bond may not be prepaid prior to maturity at the option of the Governmental Unit,
as provided in Section 3.4 of the Loan Agreement.
This Bond, and all payments due on this Bond do not constitute a general indebtedness of
the Governmental Unit, or a pledge of the faith, credit or taxing power thereof within the
meaning of any constitutional or statutory provision or limitation. Neither the State of Florida
nor any political subdivision thereof nor the Governmental Unit shall be obligated (1) to exercise
any ad valorem taxing power or any other taxing power in any form on any real or personal
property in the Governmental Unit to pay the principal of this Bond, the interest thereon or other
payments or costs under this Bond or under the Loan Agreement, or (2) to pay the same from
any other funds of the Governmental Unit except from the Pledged Revenues as provided, and
subject to the limitations contained, in the Loan Agreement and the Resolution. The issuance of
this Bond shall not directly or indirectly or contingently obligate the Governmental Unit to levy
or to pledge any form of taxation whatever therefor or to make any appropriation for its payment.
The acceptance of this Bond by the holder from time to time hereof shall be deemed an
agreement between the Governmental Unit and such holder that this Bond and the indebtedness
evidenced hereby shall not constitute a lien upon any property of the Governmental Unit, but
shall constitute a lien only on the Pledged Revenues as provided, and subject to the limitations
contained, in the Loan Agreement and the Resolution. This Bond shall not be secured by, nor
payable from moneys, Reserve Account Insurance Policies or Reserve Account Letters of Credit
on deposit in, the Reserve Account.
A-1-3
Upon the occurrence of an Event of Default under the Loan Agreement, the holder hereof
shall have any and all rights and remedies available to it under the Loan Agreement. The holder
of this bond shall have no right to enforce the provisions of the Resolution, or to institute action
to enforce the covenants therein, or to take any action with respect to any Event of Default under
the Resolution, or to institute, appear in or defend any suit or other proceeding with respect
thereto, except as provided in the Resolution.
In addition to all other rights it may have, but subject to the provisions of the Resolution,
the holder hereof shall have the following rights, each of which may be exercised at any time: (i)
to pledge, transfer or assign this Bond in the manner prescribed herein or in the Loan Agreement
and any renewals, extensions and modifications hereof, assigning therewith its rights in the Loan
Agreement in accordance with the terms thereof and any such pledgee, transferee or assignee
shall have all the rights of the holder hereof with respect to this Bond and any renewals,
extensions and modifications hereof and of the Loan Agreement so assigned therewith, and the
holder hereof making such pledge, transfer or assignment shall be thereafter relieved from any
and all liability with respect to the Loan Agreement so assigned; (ii) to notify the Governmental
Unit or any other persons obligated under the Loan Agreement to make payment to the holder of
this Bond any amounts due or to become due thereon; and (iii) to apply any amounts received
under or pursuant to the Loan Agreement against the principal of and interest on and other
amounts payable under this Bond.
A payment made on this Bond by or on behalf of the Governmental Unit shall also be
deemed a payment made under the Loan Agreement. This Bond shall not be assigned unless the
Loan Agreement is included in the assignment.
Nothing herein shall be deemed to constitute a representation or warranty that the interest
on this Bond is excludable from gross income for federal income tax purposes.
Except as otherwise provided herein, all capitalized terms used herein which are defined
in the Loan Agreement or in the Resolution shall have the meanings set forth in the Loan
Agreement or the Resolution, as applicable.
All acts, conditions and things required by the Constitution and laws of the State of
Florida and the ordinances and resolutions of the Governmental Unit to happen, exist and be
performed precedent to and in the issuance of this Bond have happened, exist and have been
performed as so required.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
benefit or security under the Resolution until this Bond shall have been authenticated by the
execution by the Bond Registrar of the certificate of authentication endorsed hereon.
A-1-4
IN WITNESS WHEREOF, the City of Miami Beach, Florida, by resolution duly
adopted by its Mayor and City Commission, has caused this Bond to be manually signed by its
Mayor and to be manually signed by its City Clerk and the official seal of the city to be manually
impressed hereon.
CITY OF MIAMI BEACH, FLORIDA
[SEAL]
By:
Mayor
By:
City Clerk
A-1-5
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the series designated herein and issued under the
provisions of the within-mentioned Resolution.
U.S. BANK NATIONAL ASSOCIATION,
as Bond Registrar
By:
Authorized Signatory
Date of Authentication: December 1, 2009
Bond Table:
The 2009)-lA Governmental Unit Note shall be prepared and delivered as multiple bonds
aggregating $ , in annual maturities and interest rates as follows:
Maturity Date Principal Amount Interest Rate
A-1-6
EXHIBIT "A-2"
FORM OF 2009)-1B GOVERNMENTAL UNIT NOTE
R-1 $
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE REFUNDING BOND
TAXABLE SERIES 2009)-1B
Maturity Date Interest Rate Original Issue Date
December 1, % December 1, 2009
Registered Holder: U.S. Bank National Association, as Trustee
Principal Amount:
For value received, the City of Miami Beach, Florida (the "Governmental Unit"), a
municipal corporation of the State of Florida, hereby promises to pay to the Registered Holder
shown above, as assignee of the Sponsor (as hereafter defined), or to the Credit Facility Issuer, if
any, as its assignee, solely from the Pledged Revenues hereafter mentioned, on the Maturity Date
shown above the Principal Amount shown above, and to pay, solely from such sources, interest
thereon from the Original Issue Date shown above at the Interest Rate per annum shown above
on each June 1 and December 1, commencing June 1, 2010.
In addition to such amounts, the actual amounts due in repayment of the Series 2009)-1 B
Loan (hereafter defined) shall also include certain amounts described in the Loan Agreement of
even date herewith (the "Loan Agreement") between and among the City of Gulf Breeze, Florida
(the "Sponsor"), the Governmental Unit and U.S. Bank National Association, as successor
Trustee, the provisions of which are incorporated herein by reference, including, without
limitation, as provided in Section 3.3 of the Loan Agreement, the Reserve Payment (as such term
is defined in the Loan Agreement), if such Reserve Payment shall be due pursuant to the
provisions of Section 3.5 of the Loan Agreement.
Any payment required to be made with respect to the Series 2009)-1B Loan which is
received later than its due date shall bear interest from such due date at a rate equal to the higher
of the rate of interest on this Bond or the Prime Rate, plus two per centum per annum (the
"Default Rate"). In addition, if an acceleration of the Series 2009)-1B Loan is declared pursuant
to Section 5.2 of the Loan Agreement following an Event of Default pursuant to the Loan
A-2-1
Agreement, the interest rate on this Bond shall be increased to the Default Rate, and certain
additional amounts shall be payable, as provided in said Section 5.2.
All amounts payable hereunder shall be payable at the designated office of U.S. Bank
National Association, Orlando, Florida, as Bond Registrar for the Governmental Unit. As
provided in the Loan Agreement, the final scheduled payment of principal on the Series 2009J-
1 B Loan (as hereinafter defined) shall be due and payable to the Trustee not less than three
Business Days prior to such final scheduled payment date.
As set forth in the Loan Agreement, a default of the Governmental Unit may also result
in a requirement that the Governmental Unit make certain additional payments with respect to a
portion of the Debt Service Reserve Fund, as defined in the Loan Agreement.
Notwithstanding anything otherwise contained in this Bond, the interest rate on this Bond
and other amounts payable by the Governmental Unit under the Loan Agreement that are treated
as interest under applicable law, shall not exceed the Maximum Rate as defined in the Loan
Agreement; provided, that, in the event the imposition of such Maximum Rate shall ever cause
the amount payable on this Bond to be less than the amount of interest which would otherwise be
computed pursuant to the Loan Agreement, this Bond shall thereafter bear interest at the
Maximum Rate until the earlier of (1) the final maturity of this Bond or (2) such time as the total
amount of interest paid on this Bond shall at such rate equals the amount of interest which would
have been payable on this Bond without regard to any Maximum Rate.
All payments made hereunder shall be applied first to payment of accrued interest on the
unpaid principal balance hereof at the aforesaid rate, and then to reduction of principal and
payment of other amounts due hereunder. In the event the full amount of this Bond is not
disbursed, the payments of principal due hereunder shall be reduced ratably to reflect such
reduction in the principal amount due hereunder.
This Bond is one of a series of bonds designated "Water and Sewer Revenue Refunding
Bonds, Taxable Series 2009)-1B," (the "Series 2009)-1B Bonds") issued by the Governmental
Unit in the aggregate principal amount of $[] to evidence an obligation to repay a loan
(the "Series 2009)-1B Loan" and together with the Series 2009)-lA Loan and the Series 2009J-
1BLoan, defined below, the "Series 2009)-1 Loan") made to the Governmental Unit pursuant to
the Loan Agreement, to refund, together with other available moneys, a portion of the
Governmental Unit's Water and Sewer Revenue Bonds, Series 2000 (the "2000 Bonds") (the
"Series J-1B Refunding Program"). Simultaneously with the issuance of the Series 2009)-1B
Bonds, the Governmental Unit is also issuing its Water and Sewer Revenue Refunding Bonds,
Taxable Series 2009)-lA (the "Series 2009)-lA Bonds"), in the aggregate principal amount of
$[__~, to evidence an obligation to repay a loan (the "Series 2009)-lA Loan") made to the
Governmental Unit pursuant to the Loan Agreement to refund, together with other available
moneys, an additional portion of the 2000 Bonds (together with the Series J-1B Refunding
Program, the "Refunding Program"). Simultaneously with the issuance of the Series 2009)-lA
Bonds and the Series 2009)-1B Bonds, the Governmental Unit is issuing its Water and Sewer
Revenue Bonds, Taxable Series 2009)-1 C (the "Series 2009)-1 C Bonds"), in the aggregate
principal amount of $~~ to evidence an obligation to repay a loan (the "Series 2009)-1C
A-2-2
Loan") made to the Governmental Unit pursuant to the Loan Agreement to finance, together with
other available moneys, the cost of making certain capital improvements to its Water and Sewer
Utility (together with the Refunding Program, the "Financing Program")
This Bond is issued under and pursuant to Resolution No. 95-21585 adopted by the
Mayor and City Commission of the Governmental Unit on May 17, 1995, as amended and
supplemented, and Resolution No. 2009- adopted by the Mayor and City Commission of
the Governmental Unit on October 14, 2009 (collectively, the "Resolution"). The Series 2009)-1
Loan is being made by the Sponsor, from the proceeds of its Local Government Loan Program
Floating Rate Demand Revenue Bonds, Series 1985) (the "Program Bonds"). The Program
Bonds are issued under a Trust Indenture dated as of December 1, 1985, as amended and restated
as of July 1, 1986, as further amended and supplemented, between the Sponsor and U.S. Bank
National Association, as successor Trustee, and as particularly amended and supplemented by a
Nineteenth Supplemental Trust Indenture dated as of December 1, 2009 (collectively, the
"Indenture").
The obligations of the Governmental Unit hereunder are limited, special obligations
payable solely from the Pledged Revenues as provided, and subject to the limitations contained,
in the Loan Agreement and the Resolution. This Bond and the Series 2009)-1B Bonds of which
it is a part, are secured pari-passu by a lien upon and pledge of the Pledged Revenues in the
manner provided in the Resolution, with the Parity Bonds, the Parity Notes, the Series 2009)-lA
Bonds and the Series 2009)-1C Bonds, as more fully described in the Loan Agreement.
This Bond may be prepaid prior to maturity at the option of the Governmental Unit, as
provided in Section 3.4 of the Loan Agreement. This Bond is also subject to optional
prepayment by the Governmental Unit on December 1, 2020 in the event that the terms of any
financing arranged by the Sponsor to retire and replace the Program Bonds are not satisfactory to
the Governmental Unit, or if no such financing has been arranged.
This Bond, and all payments due on this Bond do not constitute a general indebtedness of
the Governmental Unit, or a pledge of the faith, credit or taxing power thereof within the
meaning of any constitutional or statutory provision or limitation. Neither the State of Florida
nor any political subdivision thereof nor the Governmental Unit shall be obligated (1) to exercise
any ad valorem taxing power or any other taxing power in any form on any real or personal
property in the Governmental Unit to pay the principal of this Bond, the interest thereon or other
payments or costs under this Bond or under the Loan Agreement, or (2) to pay the same from
any other funds of the Governmental Unit except from the Pledged Revenues as provided, and
subject to the limitations contained, in the Loan Agreement and the Resolution. The issuance of
this Bond shall not directly or indirectly or contingently obligate the Governmental Unit to levy
or to pledge any form of taxation whatever therefor or to make any appropriation for its payment.
The acceptance of this Bond by the holder from time to time hereof shall be deemed an
agreement between the Governmental Unit and such holder that this Bond and the indebtedness
evidenced hereby shall not constitute a lien upon any property of the Governmental Unit, but
shall constitute a lien only on the Pledged Revenues as provided, and subject to the limitations
contained, in the Loan Agreement and the Resolution. This Bond shall not be secured by, nor
A-2-3
payable from moneys, Reserve Account Insurance Policies or Reserve Account Letters of Credit
on deposit in, the Reserve Account.
Upon the occurrence of an Event of Default under the Loan Agreement, the holder hereof
shall have any and all rights and remedies available to it under the Loan Agreement. The holder
of this bond shall have no right to enforce the provisions of the Resolution, or to institute action
to enforce the covenants therein, or to take any action with respect to any Event of Default under
the Resolution, or to institute, appear in or defend any suit or other proceeding with respect
thereto, except as provided in the Resolution.
In addition to all other rights it may have, but subject to the provisions of the Resolution,
the holder hereof shall have the following rights, each of which may be exercised at any time: (i)
to pledge, transfer or assign this Bond in the manner prescribed herein or in the Loan Agreement
and any renewals, extensions and modifications hereof, assigning therewith its rights in the Loan
Agreement in accordance with the terms thereof and any such pledgee, transferee or assignee
shall have all the rights of the holder hereof with respect to this Bond and any renewals,
extensions and modifications hereof and of the Loan Agreement so assigned therewith, and the
holder hereof making such pledge, transfer or assignment shall be thereafter relieved from any
and all liability with respect to the Loan Agreement so assigned; (ii) to notify the Governmental
Unit or any other persons obligated under the Loan Agreement to make payment to the holder of
this Bond any amounts due or to become due thereon; and (iii) to apply any amounts received
under or pursuant to the Loan Agreement against the principal of and interest on and other
amounts payable under this Bond.
A payment made on this Bond by or on behalf of the Governmental Unit shall also be
deemed a payment made under the Loan Agreement. This Bond shall not be assigned unless the
Loan Agreement is included in the assignment.
Nothing herein shall be deemed to constitute a representation or warranty that the interest
on this Bond is excludable from gross income for federal income tax purposes.
Except as otherwise provided herein, all capitalized terms used herein which are defined
in the Loan Agreement or in the Resolution shall have the meanings set forth in the Loan
Agreement or the Resolution, as applicable.
All acts, conditions and things required by the Constitution and laws of the State of
Florida and the ordinances and resolutions of the Governmental Unit to happen, exist and be
performed precedent to and in the issuance of this Bond have happened, exist and have been
performed as so required.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
benefit or security under the Resolution until this Bond shall have been authenticated by the
execution by the Bond Registrar of the certificate of authentication endorsed hereon.
A-2-4
IN WITNESS WHEREOF, the City of Miami Beach, Florida, by resolution duly
adopted by its Mayor and City Commission, has caused this Bond to be manually signed by its
Mayor and to be manually signed by its City Clerk and the official seal of the city to be manually
impressed hereon.
CITY OF MIAMI BEACH, FLORIDA
[SEAL]
By:
Mayor
By:
City Clerk
A-2-5
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the series designated herein and issued under the
provisions of the within-mentioned Resolution.
U.S. BANK NATIONAL ASSOCIATION,
as Bond Registrar
By:
Authorized Signatory
Date of Authentication: December 1, 2009
Bond Table:
The 2009)-1B Governmental Unit Note shall be prepared and delivered as multiple bonds
aggregating $ , in annual maturities and interest rates as follows:
Maturit Date Principal Amount Interest Rate
A-2-6
EXHIBIT "A-3"
FORM OF 2009)-1C GOVERNMENTAL UNIT NOTE
R-1
Maturity Date
December 1,
Registered Holder:
Principal Amount:
UNITED STATES OF AMERICA
STATE OF FLORIDA
CITY OF MIAMI BEACH, FLORIDA
WATER AND SEWER REVENUE BOND
TAXABLE SERIES 2009)-1 C
Interest Rate
Original Issue Date
December 1, 2009
U.S. Bank National Association, as Trustee
For value received, the City of Miami Beach, Florida (the "Governmental Unit"), a
municipal corporation of the State of Florida, hereby promises to pay to the Registered Holder
shown above, as assignee of the Sponsor (as hereafter defined), or to the Credit Facility Issuer, if
any, as its assignee, solely from the Pledged Revenues hereafter mentioned, on the Maturity Date
shown above the Principal Amount shown above, and to pay, solely from such sources, interest
thereon from the Original Issue Date shown above at the Interest Rate per annum shown above
on each June 1 and December 1, commencing June 1, 2010.
In addition to such amounts, the actual amounts due in repayment of the Series 2009)-1C
Loan (hereafter defined) shall also include certain amounts described in the Loan Agreement of
even date herewith (the "Loan Agreement") between and among the City of Gulf Breeze, Florida
(the "Sponsor"), the Governmental Unit and U.S. Bank National Association, as successor
Trustee, the provisions of which are incorporated herein by reference, including, without
limitation, as provided in Section 3.3 of the Loan Agreement, the Reserve Payment shall be due
pursuant to the provisions of Section 3.5 of the Loan Agreement.
Any payment required to be made with respect to the Series 2009)-1C Loan which is
received later than its due date shall bear interest from such due date at a rate equal to the higher
of the rate of interest on this Bond or the Prime Rate, plus two per centum per annum (the
"Default Rate"). In addition, if an acceleration of the Series 2009)-1 C Loan is declared pursuant
to Section 5.2 of the Loan Agreement following an Event of Default pursuant to the Loan
Agreement, the interest rate on this Bond shall be increased to the Default Rate, and certain
additional amounts shall be payable, as provided in said Section 5.2.
A-3-1
All amounts payable hereunder shall be payable at the designated office of U.S. Bank
National Association, Orlando, Florida, as Bond Registrar for the Governmental Unit. As
provided in the Loan Agreement, the final scheduled payment of principal on the Series 2009J-
1 C Loan (as hereinafter defined) shall be due and payable to the Trustee not less than three
Business Days prior to such final scheduled payment date.
As set forth in the Loan Agreement, a default of the Governmental Unit may also result
in a requirement that the Governmental Unit make certain additional payments with respect to a
portion of the Debt Service Reserve Fund, as defined in the Loan Agreement.
Notwithstanding anything otherwise contained in this Bond, the interest rate on this Bond
and other amounts payable by the Governmental Unit under the Loan Agreement that are treated
as interest under applicable law, shall not exceed the Maximum Rate as defined in the Loan
Agreement; provided, that, in the event the imposition of such Maximum Rate shall ever cause
the amount payable on this Bond to be less than the amount of interest which would otherwise be
computed pursuant to the Loan Agreement, this Bond shall thereafter bear interest at the
Maximum Rate until the earlier of (1) the final maturity of this Bond or (2) such time as the total
amount of interest paid on this Bond shall at such rate equals the amount of interest which would
have been payable on this Bond without regard to any Maximum Rate.
All payments made hereunder shall be applied first to payment of accrued interest on the
unpaid principal balance hereof at the aforesaid rate, and then to reduction of principal and
payment of other amounts due hereunder. In the event the full amount of this Bond is not
disbursed, the payments of principal due hereunder shall be reduced ratably to reflect such
reduction in the principal amount due hereunder.
This Bond is one of a series of bonds designated "Water and Sewer Revenue Bonds,
Taxable Series 2009)-1C," (the "Series 2009)-1C Bonds") issued by the Governmental Unit in
the aggregate principal amount of $(~ to evidence the obligation to repay a loan (the
"Series 2009)-1 C Loan" and together with the Series 2009)-1 A Loan and the Series 2009)-1 B
Loan defined below, the "Series 2009)-1 Loan") made to the Governmental Unit pursuant to the
Loan Agreement, to finance, together with any other available moneys, the Governmental Unit's
cost of making certain capital improvements to its Water and Sewer Utility (together with the
Refunding Program defined below, the "Financing Program"). Simultaneously with the issuance
of the Series 2009)-1C Bonds, the Governmental Unit is also issuing its Water and Sewer
Revenue Refunding Bonds, Taxable Series 2009)-lA (the "Series 2009)-lA Bonds"), in the
aggregate principal amount of $[~, and its Water and Sewer Revenue Refunding Bonds,
Taxable Series 2009)-1 B (the "Series 2009)-1 B Bonds"), in the aggregate principal amount of
~[_~, each series to evidence an obligation to repay a loan (the "Series 2009)-lA Loan"
and the "Series 2009)-1 B Loan," respectively) made to the Governmental Unit pursuant to the
Loan Agreement to refund, together with other available moneys, a portion of the Governmental
Unit's Water and Sewer Revenue Bonds, Series 2000 (the "Refunding Program").
This Bond is issued under and pursuant to Resolution No. 95-21585 adopted by the
Mayor and City Commission of the Governmental Unit on May 17, 1995, as amended and
A-3-2
supplemented, and Resolution No. 2009- adopted by the Mayor and City Commission of
the Governmental Unit on October 14, 2009 (collectively, the "Resolution"). The Series 2009)-1
Loan is being made by the Sponsor, from the proceeds of its Local Government Loan Program
Floating Rate Demand Revenue Bonds, Series 1985) (the "Program Bonds"). The Program
Bonds are issued under a Trust Indenture dated as of December 1, 1985, as amended and restated
as of July 1, 1986, as further amended and supplemented, between the Sponsor and U.S. Bank
National Association, as successor Trustee, and as particularly amended and supplemented by a
Nineteenth Supplemental Trust Indenture dated as of December 1, 2009 (collectively, the
"Indenture").
The obligations of the Governmental Unit hereunder are limited, special obligations
payable solely from the Pledged Revenues as provided, and subject to the limitations contained,
in the Loan Agreement and the Resolution. This Bond and the Series 2009)-1C Bonds of which
it is a part, are secured pari-passu by a lien upon and pledge of the Pledged Revenues in the
manner provided in the Resolution, with the Parity Bonds, the Parity Notes, the Series 2009)-lA
Bonds and the Series 2009)-1B Bonds, as more fully described in the Loan Agreement.
This Bond may be prepaid prior to maturity at the option of the Governmental Unit, as
provided in Section 3.4 of the Loan Agreement. This Bond is also subject to optional
prepayment by the Governmental Unit on December 1, 2020 in the event that the terms of any
financing arranged by the Sponsor to retire and replace the Program Bonds are not satisfactory to
the Governmental Unit, or if no such financing has been arranged.
This Bond, and all payments due on this Bond do not constitute a general indebtedness of
the Governmental Unit, or a pledge of the faith, credit or taxing power thereof within the
meaning of any constitutional or statutory provision or limitation. Neither the State of Florida
nor any political subdivision thereof nor the Governmental Unit shall be obligated (1) to exercise
any ad valorem taxing power or any other taxing power in any form on any real or personal
property in the Governmental Unit to pay the principal of this Bond, the interest thereon or other
payments or costs under this Bond or under the Loan Agreement, or (2) to pay the same from
any other funds of the Governmental Unit except from the Pledged Revenues as provided, and
subject to the limitations contained, in the Loan Agreement and the Resolution. The issuance of
this Bond shall not directly or indirectly or contingently obligate the Governmental Unit to levy
or to pledge any form of taxation whatever therefor or to make any appropriation for its payment.
The acceptance of this Bond by the holder from time to time hereof shall be deemed an
agreement between the Governmental Unit and such holder that this Bond and the indebtedness
evidenced hereby shall not constitute a lien upon any property of the Governmental Unit, but
shall constitute a lien only on the Pledged Revenues as provided, and subject to the limitations
contained, in the Loan Agreement and the Resolution. This Bond shall not be secured by, nor
payable from moneys, Reserve Account Insurance Policies or Reserve Account Letters of Credit
on deposit in, the Reserve Account.
Upon the occurrence of an Event of Default under the Loan Agreement, the holder hereof
shall have any and all rights and remedies available to it under the Loan Agreement. The holder
of this bond shall have no right to enforce the provisions of the Resolution, or to institute action
to enforce the covenants therein, or to take any action with respect to any Event of Default under
A-3-3
the Resolution, or to institute, appear in or defend any suit or other proceeding with respect
thereto, except as provided in the Resolution.
In addition to all other rights it may have, but subject to the provisions of the Resolution,
the holder hereof shall have the following rights, each of which may be exercised at any time: (i)
to pledge, transfer or assign this Bond in the manner prescribed herein or in the Loan Agreement
and any renewals, extensions and modifications hereof, assigning therewith its rights in the Loan
Agreement in accordance with the terms thereof and any such pledgee, transferee or assignee
shall have all the rights of the holder hereof with respect to this Bond and any renewals,
extensions and modifications hereof and of the Loan Agreement so assigned therewith, and the
holder hereof making such pledge, transfer or assignment shall be thereafter relieved from any
and all liability with respect to the Loan Agreement so assigned; (ii) to notify the Governmental
Unit or any other persons obligated under the Loan Agreement to make payment to the holder of
this Bond any amounts due or to become due thereon; and (iii) to apply any amounts received
under or pursuant to the Loan Agreement against the principal of and interest on and other
amounts payable under this Bond.
A payment made on this Bond by or on behalf of the Governmental Unit shall also be
deemed a payment made under the Loan Agreement. This Bond shall not be assigned unless the
Loan Agreement is included in the assignment.
Nothing herein shall be deemed to constitute a representation or warranty that the interest
on this Bond is excludable from gross income for federal income tax purposes.
Except as otherwise provided herein, all capitalized terms used herein which are defined
in the Loan Agreement or in the Resolution shall have the meanings set forth in the Loan
Agreement or the Resolution, as applicable.
All acts, conditions and things required by the Constitution and laws of the State of
Florida and the ordinances and resolutions of the Governmental Unit to happen, exist and be
performed precedent to and in the issuance of this Bond have happened, exist and have been
performed as so required.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
benefit or security under the Resolution until this Bond shall have been authenticated by the
execution by the Bond Registrar of the certificate of authentication endorsed hereon.
A-3-4
IN WITNESS WHEREOF, the City of Miami Beach, Florida, by resolution duly
adopted by its Mayor and City Commission, has caused this Bond to be manually signed by its
Mayor and to be manually signed by its City Clerk and the official seal of the city to be manually
impressed hereon.
CITY OF MIAMI BEACH, FLORIDA
[SEAL]
By:
Mayor
By:
City Clerk
A-3-5
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the series designated herein and issued under the
provisions of the within-mentioned Resolution.
U.S. BANK NATIONAL ASSOCIATION,
as Bond Registrar
By:
Authorized Signatory
Date of Authentication: December 1, 2009
Bond Table:
The 2009)-1C Governmental Unit Note shall be prepared and delivered as multiple bonds
aggregating $ , in annual maturities and interest rates as follows:
Maturit Date Principal Amount Interest Rate
A-3-6
SCHEDULE "I" TO LOAN AGREEMENT
SERIES 2009 PROJECT
The Series 2009 Project consists of the following improvements to the Water and Sewer
Utility:
Sewer System Improvements
^ Replacement of sanitary sewer lines, manhole structures and service laterals,
^ Rehabilitation of the existing gravity sewer system to eliminate excessive groundwater
infiltration and storm water inflow into the sanitary sewer system,
^ Repair or replacement of existing force mains and construction of new force mains,
^ Rehabilitation, replacement, or addition of generators to all pump stations pumping into a
12-inch or larger main, or receiving flow from a force main,
^ Pump station site rehabilitation, including maintenance accessibility, landscaping, and
odor control,
^ Replacement of undersized sanitary sewer lines,
^ Engineering services for sewer pipe repairs and replacements,
^ SCADA system upgrades at sewer pump stations and central control room, and
^ Other improvements that add operational capacity or efficiency, reduce maintenance or
extend useful life.
Water System Improvements
^ Replacement of galvanized iron water mains,
^ Replacement of undersized water mains to improve fire flow and pressure conditions,
^ Replacement of old, tuberculated water mains,
^ Replacement of water service lines, meter boxes and meters,
^ Installation of valves and fire hydrants as needed,
^ Engineering services for sewer pipe repairs and replacements,
^ SCADA system upgrades at water pump stations and central control room, and
^ Other improvements that add operational capacity or efficiency, reduce maintenance or
extend useful life.
The Commission may approve by resolution other Improvements as part of the Series
2009 Project in addition to and/or in lieu of one or more of the above Improvements provided
that prior to the expenditure of any proceeds of the Series 2009)-1C Bonds for such additional
Improvements, the Sponsor shall have received an opinion of nationally recognized bond counsel
of its choosing, to the effect that such expenditure will not adversely affect the exclusion of
interest on the Program Bonds from gross income for federal income tax purposes.
SCHEDULE I-I
SCHEDULE ~~II" TO LOAN AGREEMENT
FEES AND EXPENSES
Bond Counsel to Pool Fee
Bond Counsel to Pool Expenses
Sponsor Disclosure Counsel
Sponsor Disclosure Counsel Expenses
Sponsor Special Tax Counsel
Sponsor's Counsel Fee
Governmental Unit Bond Counsel Fee
Governmental Unit Bond Counsel Expenses
Governmental Unit Financial Advisor Fee
Governmental Unit Financial Advisor Expenses
Rating Agency Fee
Printer
Miscellaneous
Government Credit Corporation Origination Fee
Sponsor Administration Fee
Remarketing Fees and Expenses
Redemption Premium of Refunded Bonds
Other Costs regarding the Escrow Deposit Trust Fund
Bond Insurance Premium
Other
TOTAL
SCHEDULE II-1
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SCHEDULE "IV" TO LOAN AGREEMENT
REDEMPTION OF PROGRAM BONDS
The Program Bonds related to the Series 20091-1B Loan and the Series 2009)-1C Loan
and being remarketed shall be redeemable on thirty (30) days' written notice, as provided in the
Indenture, on December 1, ~ , or on December 1 of any year thereafter, as a whole, or in
part, in inverse order of maturities at a redemption price equal to the principal amount thereof to
be redeemed, without premium, plus accrued interest to the redemption date. In the event that
less than all of such Program Bonds of an entire maturity are redeemed, the Program Bonds of
such maturity shall be selected at random in a manner deemed fair by the Trustee.
The Governmental Unit shall have the right to prepay the Series 2009)-1 B Loan and the
Series 2009)-1 C Loan in whole or in part on any date on which the Program Bonds related to the
Series 2009)-1B Loan or the Series 2009)-1C Loan may be called for redemption or mandatory
tender.
SCHEDULE N-1
CITY OF MIAMI BEACH, FLORIDA
and
U.S. BANK NATIONAL ASSOCIATION,
as Escrow Agent
ESCROW DEPOSIT AGREEMENT
Relating to
WATER AND SEWER REVENUE BONDS,
SERIES 2000
DATED AS OF DECEMBER 1, 2009
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ESCROW DEPOSIT AGREEMENT
THIS ESCROW DEPOSIT AGREEMENT (the "Agreement") made and entered into
as of December 1, 2009, by and between the CITY OF MIAMI BEACH, FLORIDA (the
"City") and U.S. BANK NATIONAL ASSOCIATION, as Escrow Agent (the "Escrow
Agent").
WITNESSETH:
WHEREAS, the City has heretofore issued its $54,310,000 aggregate principal amount
of City of Miami Beach, Florida Water and Sewer Revenue Bonds, Series 2000, dated as of
August 15, 2000, presently outstanding in the principal amount of $54,310,000 (such outstanding
bonds referred to collectively as the "Outstanding Bonds"), all pursuant to the provisions of
Resolution No. 95-21585 adopted by the Mayor and City Commission of the City (the
"Commission") on May 17, 1995 (the "Original Resolution"), and Resolution No. 2000-24041
adopted by the Commission on July 26, 2000 (the "2000 Resolution" and together with the
Original Resolution, the "Bond Resolution"); and
WHEREAS, the City desires to refund and defease a portion of the Outstanding Bonds
as more particularly described in Schedule A attached hereto and made a part hereof (the
"Refunded Bonds"); and
WHEREAS, the City has issued its $~~ aggregate principal amount of City of
Miami Beach, Florida Water and Sewer Revenue Refunding Bonds, Taxable Series 2009)-lA
and its $~~ aggregate principal amount of City of Miami Beach, Florida Water and
Sewer Revenue Refunding Bonds, Taxable Series 2009)-1B (collectively, the "Bonds"),
pursuant to the provisions of the Original Resolution and Resolution No. 2009- adopted by
the Commission on October 14, 2009 (the "2009 Resolution"), the proceeds of which Bonds
shall be deposited with the Escrow Agent to provide, with investment earnings thereon and
certain other available moneys, for the refunding and defeasance of the Refunded Bonds; and
WHEREAS, a portion of the proceeds derived from the sale of the Bonds, together with
the other available moneys, will be applied to the purchase of Government Obligations (as such
term is hereinafter defined), which will mature and produce investment income and earnings at
such time and in such amount as will be sufficient, together with certain moneys remaining
uninvested, to pay when due or upon the redemption thereof, the principal of and redemption
premium and interest on the Refunded Bonds as more specifically set forth herein; and
WHEREAS, in order to provide for the proper and timely application of the moneys
deposited hereunder, the maturing principal amount of the Government Obligations purchased
therewith, and investment income and earnings derived therefrom to the payment of the
Refunded Bonds, it is necessary for the City to enter into this Agreement with the Escrow Agent;
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NOW, THEREFORE, the City, in consideration of the foregoing and the mutual
covenants herein set forth and in order to secure the payment of the principal of and interest on
all of the Refunded Bonds according to their tenor and effect, does hereby agree as follows:
ARTICLE I
CREATION AND CONVEYANCE OF TRUST ESTATE
Section 1.01. Creation and Conveyance of Trust Estate. The City hereby grants,
warrants, remises, releases, conveys, assigns, transfers, aliens, pledges, sets over and confirms
unto the Escrow Agent and to its successors in the trust hereby created, and to it and its assigns
forever, all and singular the property hereinafter described, to wit:
DIVISION I
All right, title and interest in and to (i) $ in moneys deposited directly with the
Escrow Agent and derived from the proceeds of the Bonds upon issuance and delivery of the
Bonds and execution of and delivery of this Agreement, (ii) $ in moneys derived
from a contribution from the City of Gulf Breeze and (iii) $ in moneys derived from
the Bond Service Subaccount created under the Bond Resolution (such moneys described in (ii)
and (iii) collectively, the "Other Moneys").
DIVISION II
All right, title and interest in and to the Government Obligations described in Schedule B
attached hereto and made a part hereof, together with the income and earnings thereon.
DIVISION III
Any and all other property of every kind and nature from time to time hereafter, by
delivery or by writing of any kind, conveyed, pledged, assigned or transferred as and for
additional security hereunder by the City, or by anyone on behalf of the City to the Escrow
Agent for the benefit of the Refunded Bonds.
DIVISION IV
All property which is by the express provisions of this Agreement required to be subject
to the pledge hereof and any additional property that may, from time to time hereafter, by
delivery or by writing of any kind, by the City, or by anyone in its behalf, be subject to the
pledge hereof.
TO HAVE AND TO HOLD, all and singular, the Trust Estate (as such term is
hereinafter defined), including all additional property which by the terms hereof has or may
become subject to the encumbrances of this Agreement, unto the Escrow Agent, and its
successors and assigns, forever in trust, however, for the sole benefit and security of the holders
from time to time of the Refunded Bonds, but if the principal of, redemption premium and
interest on all of the Refunded Bonds shall be fully and promptly paid when due or upon the
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redemption thereof, in accordance with the terms thereof, then this Agreement shall be and
become void and of no further force and effect except as otherwise provided herein; otherwise
the same shall remain in full force and effect, and upon the trusts and subject to the covenants
and conditions hereinafter set forth.
ARTICLE II
DEFINITIONS
Section 2.01. Definitions. In addition to words and terms elsewhere defined in this
Agreement, the following words and terms as used in this Agreement shall have the following
meanings, unless some other meaning is plainly intended.
"Government Obligations" shall have the meaning given to such term in the Bond
Resolution, but as limited under the 2000 Resolution.
"Refunding Loan Agreement" shall have the_meaning given to "Loan Agreement" in
the 2009 Resolution.
"Program Bonds" shall mean the City of Gulf Breeze, Florida Local Government Loan
Program Floating Rate Demand Revenue Bonds, Series 1985J.
"Trust Estate", "trust estate" or "pledged property" shall mean the property, rights
and interests described or referred to under Divisions I, II, III and IV in Article I above.
Words of the masculine gender shall be deemed and construed to include correlative
words of the feminine and neuter genders. Words importing the singular number shall include
the plural number and vice versa unless the context shall otherwise indicate. The word "person"
shall include corporations, associations, natural persons and public bodies unless the context
shall otherwise indicate. Reference to a person other than a natural person shall include its
successors.
ARTICLE III
ESTABLISHMENT OF ESCROW DEPOSIT TRUST FUND;
FLOW OF FUNDS
Section 3.01. Creation of Escrow Deposit Trust Fund and Deposit of Moneys. There
is hereby created and established with the Escrow Agent a special and irrevocable trust fund
designated "City of Miami Beach, Florida Water and Sewer Revenue Bonds, Series 2000 Escrow
Deposit Trust Fund" (the "Escrow Deposit Trust Fund"), to be held by the Escrow Agent for the
sole benefit of the holders of the Refunded Bonds and accounted for separate and apart from the
other funds of the City and, to the extent required by law, of the Escrow Agent.
Concurrently with the delivery of this Agreement, the City herewith causes to be
deposited with the Escrow Agent and the Escrow Agent acknowledges receipt of immediately
available moneys for deposit in the Escrow Deposit Trust Fund in the amount of $
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consisting of $ from the proceeds of the Bonds, and $ in Other Moneys,
all of which, when invested in Government Obligations (other than $ from the Other
Moneys to be held uninvested), will provide moneys sufficient to pay the principal of and
redemption premium and interest on the Refunded Bonds, upon the payment at redemption
thereof, as more particularly described in Schedule C attached hereto and made a part hereof.
Section 3.02. Payment of Refunded Bonds. The Bond proceeds and Other Moneys
received by the Escrow Agent will be sufficient to purchase $ par amount of
Government Obligations, all as listed in Schedule B attached hereto and made a part hereof,
which will mature in principal amounts and earn income at such times so that sufficient moneys
will be available to pay as the same are paid when due or redeemed all principal of and
redemption premium and interest on the Refunded Bonds. Notwithstanding the foregoing, if the
amounts deposited in the Escrow Deposit Trust Fund are insufficient to make said payments of
principal and interest, the City shall cause to be deposited into the Escrow Deposit Trust Fund
the amount of any deficiency immediately upon notice from the Escrow Agent.
Section 3.03. Irrevocable Trust Created. The deposit of moneys and Government
Obligations or other property hereunder in the Escrow Deposit Trust Fund shall constitute an
irrevocable deposit of said moneys and Government Obligations and other property hereunder
for the sole benefit of the holders of the Refunded Bonds, subject to the provisions of this
Agreement. The holders of the Refunded Bonds, subject to the provisions of this Agreement,
shall have an express lien on all moneys and principal of and earnings on the Government
Obligations and other property in the Escrow Deposit Trust Fund. The moneys deposited in the
Escrow Deposit Trust Fund and the matured principal of the Government Obligations and other
property hereunder and the interest thereon shall be held in trust by the Escrow Agent, and shall
be applied for the payment of Refunded Bonds, as more specifically set forth in Schedule C
hereto.
Section 3.04. Purchase of Government Obli;ations.
The Escrow Agent is hereby directed immediately to purchase the Government
Obligations listed in Schedule B from the proceeds of the Bonds and the Other Moneys as
described in Sections 3.01 and 3.02 hereof. The Escrow Agent shall purchase the Government
Obligations solely from the moneys deposited in the Escrow Deposit Trust Fund as provided in
this Agreement. The Escrow Agent shall apply the moneys deposited in the Escrow Deposit
Trust Fund and the Government Obligations purchased therewith, together with all income or
earnings thereon, in accordance with the provisions hereof. The Escrow Agent shall have no
power or duty to invest any moneys held hereunder or to make substitutions of the Government
Obligations held hereunder or to sell, transfer or otherwise dispose of the Government
Obligations held hereunder except as provided in this Agreement. The Escrow Agent is hereby
directed not to invest $ from the Other Moneys deposited in the Escrow Deposit Trust
Fund simultaneously with the delivery of this Agreement.
The City covenants to take no action in the investment, reinvestment or security of the
Escrow Deposit Trust Fund in violation of this Agreement and recognizes that any such action in
contravention of this Agreement might cause the Refunded Bonds to be classified as "arbitrage
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bonds" under the Internal Revenue Code of 1986, as amended, and the regulations promulgated
thereunder (the "Code") or might cause the Program Bonds to be classified as "arbitrage bonds"
under the Internal Revenue Code of 1954, as amended, and the regulations promulgated
thereunder (the "1954 Code").
Section 3.05. Substitution of Certain Government Obligations.
(a) If so directed in writing by the City on the date of delivery of this Agreement, the
Escrow Agent shall accept in substitution for all or a portion of the Government Obligations
listed in Schedule B, Government Obligations (the "Substituted Securities"), the principal of and
interest on which, together with any Government Obligations listed in Schedule B for which no
substitution is made and moneys held uninvested by the Escrow Agent, will be sufficient to pay
all principal of and redemption premium and interest on the Refunded Bonds as set forth in
Schedule C hereof. The foregoing notwithstanding, the substitution of Substituted Securities for
any of the Government Obligations listed in Schedule B may be effected only upon compliance
with Section 3.05(b)(1) and (2) below.
(b) If so directed in writing by the City at any time during the term of this Agreement,
the Escrow Agent shall sell, transfer, exchange or otherwise dispose of, or request the
redemption of, all or a portion of the Government Obligations then held in the Escrow Deposit
Trust Fund and shall substitute for such Government Obligations other Government Obligations,
designated by the City, and acquired by the Escrow Agent with the proceeds derived from the
sale, transfer, disposition or redemption of or by the exchange of such Government Obligations
held in the Escrow Deposit Trust Fund, but only upon the receipt by the Escrow Agent of:
(1) an opinion of nationally recognized counsel in the field of law relating to
municipal bonds stating that such substitution will not adversely affect the exclusion from
gross income for federal income tax purposes of interest on the Refunded Bonds or the
exemption from federal income tax of interest on the Program Bonds and is not
inconsistent with the statutes and regulations applicable to the Refunded Bonds and the
Program Bonds; and
(2) verification by a firm of independent certified public accountants or a firm
of verification agents having a nationally recognized practice of escrow verifications for
municipal bonds, stating that the principal of and interest on the substituted Government
Obligations, together with any Government Obligations and any uninvested moneys
remaining in the Escrow Deposit Trust Fund will be sufficient, without reinvestment, to
pay the remaining principal of and redemption premium and interest on the Refunded
Bonds as set forth in Schedule C hereof.
Any moneys resulting from the sale, transfer, disposition or redemption of the Government
Obligations held hereunder and the substitution therefor of other Government Obligations not
required to be applied for the payment of such principal of, redemption premium and interest on
the Refunded Bonds (as shown in the verification report described in Section 3.05(b)(2) hereof
delivered in connection with such substitution), shall, subject to the provisions of the Refunding
Loan Agreement, be deposited in the Enterprise Fund established under the Bond Resolution.
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Upon any such substitution of Government Obligations pursuant to Section 3.05, Schedule B
hereto shall be appropriately amended to reflect such substitution.
The Escrow Agent shall be under no duty to inquire whether the Government Obligations
as deposited in the Escrow Deposit Trust Fund are properly invested under the Code. The
Escrow Agent may rely on all specific directions in this Agreement providing for the investment
or reinvestment of the Escrow Deposit Trust Fund.
Section 3.06. Transfers from Escrow Deposit Trust Fund. As the principal of the
Government Obligations set forth in Schedule B shall mature and be paid, and the investment
income and earnings thereon are paid, the Escrow Agent shall pay from such moneys to U.S.
Bank National Association, in its capacity of paying agent with respect to the Refunded Bonds
(as paying agent and bond registrar with respect to the Refunded Bonds, the "Refunded Bonds
Bond Registrar"), no later than each payment date for the Refunded Bonds, as specified in
Schedule C hereof, the amounts necessary to pay the principal of and redemption premium and
interest on the Refunded Bonds, as specified in Schedule C hereof. The City hereby irrevocably
determines, and instructs the Refunded Bonds Bond Registrar and the Escrow Agent, to call the
Refunded Bonds for redemption on September 1, 2010 at a redemption price of 101% of the
principal amount thereof in accordance with the Bond Resolution. The City, the Refunded
Bonds Bond Registrar and the Escrow Agent shall perform the responsibilities, described in the
Bond Resolution, in connection with the redemption of such Refunded Bonds, including the
giving of notice of redemption as required therein. A copy of such notice of redemption shall be
mailed to the centralized information repository maintained by the Municipal Securities
Rulemaking Board (the "MSIR") and to Ambac Assurance Corporation (the "Series 2000 Bond
Insurer").
Section 3.07. Investment of Certain Monevs Remaining in Escrow Deposit Trust
Fund. The Escrow Agent shall invest and reinvest, at the written direction of the City, in
Government Obligations any moneys remaining from time to time in the Escrow Deposit Trust
Fund until such time as they are needed. Such moneys shall be reinvested in such Government
Obligations for such periods and at such interest rates, as the Escrow Agent shall be directed to
invest by the City, upon receipt by the Escrow Agent of (1) an opinion from nationally
recognized counsel in the field of law relating to municipal bonds to the effect that such
reinvestment of such moneys in such Government Obligations for such period and at such
interest rates will not, under the statutes and regulations applicable to the Refunded Bonds and
the Program Bonds, cause the interest on the Refunded Bonds or the Program Bonds to be
included in gross income for federal income tax purposes and that such investment is not
inconsistent with the statutes and regulations applicable to the Refunded Bonds and the Program
Bonds and (2) verification by a firm of independent certified public accountants stating that the
principal of and interest on the Government Obligations deposited in the Escrow Deposit Trust
Fund as a result of such reinvestment, together with any Government Obligations and any
uninvested moneys remaining in the Escrow Deposit Trust Fund will be sufficient, with further
reinvestment, to pay the remaining principal of and redemption premium and interest on the
Refunded Bonds as set forth in Schedule C hereof. Any interest income resulting from
reinvestment of moneys pursuant to this Section 3.07 not required to be applied for the payment
of the principal of, if any, and interest on the Refunded Bonds shall, subject to the provisions of
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the Refunding Loan Agreement, be deposited in the Enterprise Fund established under the Bond
Resolution.
Section 3.08. Escrow Deposit Trust Fund Constitutes Trust Fund. The Escrow
Deposit Trust Fund created and established pursuant to this Agreement shall be and constitute a
trust fund for the purposes provided in this Agreement and shall be kept separate and distinct
from all other funds of the City and, to the extent required by law, of the Escrow Agent and used
only for the purposes and in the manner provided in this Agreement. Until the moneys held by
the Escrow Agent are applied as provided herein, the City of Gulf Breeze, Florida, and U.S.
Bank National Association, Trustee for the Program Bonds, shall have the right to enforce the
provisions hereof.
Section 3.09. Transfer of Funds After All Payments Required by this Agreement
are Made. After all of the transfers by the Escrow Agent to the payment of the principal of and
redemption premium and interest on the Refunded Bonds provided in Schedule C have been
made, all remaining moneys and securities, together with any income and interest thereon, in the
Escrow Deposit Trust Fund shall, subject to the provisions of the Refunding Loan Agreement, be
deposited in the Enterprise Fund established under the Bond Resolution; provided, however, that
no such transfers (except transfers made in accordance with Sections 3.05 and 3.07 hereof] shall
be made until all of the principal of and interest on the Refunded Bonds have been paid.
ARTICLE IV
CONCERNING THE ESCROW AGENT
Section 4.01. Liability of Escrow Agent. The Escrow Agent shall not be liable in
connection with the performance of its duties hereunder except for its own negligence,
misconduct or default. The Escrow Agent shall not be liable for any loss resulting from any
investments made pursuant to the terms of this Agreement. The Escrow Agent shall not be liable
for the accuracy of the calculations as to the sufficiency of moneys and of the principal amount
of the Government Obligations and the earnings thereon to pay the Refunded Bonds. So long as
the Escrow Agent applies any moneys, Government Obligations and interest earnings therefrom
to pay the Refunded Bonds as provided herein, and complies fully with the terms of this
Agreement, the Escrow Agent shall not be liable for any deficiencies in the amounts necessary to
pay the Refunded Bonds caused by such calculations.
The duties and obligations of the Escrow Agent shall be determined by the express
provisions of this Agreement. The Escrow Agent may consult with counsel with respect to any
matter relevant to this Agreement, who may or may not be counsel to the City, and be entitled to
receive from the City reimbursement of the reasonable fees and expenses of such counsel, and in
reliance upon the opinion of such counsel have full and complete authorization and protection in
respect of any action taken, suffered or omitted by it in good faith in accordance therewith.
Whenever the Escrow Agent shall deem it necessary or desirable that a matter be proved or
established prior to taking, suffering or omitting any action under this Agreement, such matter
may be deemed to be conclusively established by a certificate signed by an authorized officer of
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the City, the City of Gulf Breeze, the Trustee for the Program Bonds and the Escrow Agent may
in good faith conclusively rely upon such certificate.
The Escrow Agent shall have no lien, security interest or right of set-off whatsoever upon
any of the moneys or investments in the Escrow Deposit Trust Fund for the payment of fees or
expenses for the services rendered by the Escrow Agent under this Agreement.
Section 4.02. Permitted Acts. The Escrow Agent and its affiliates may become the
owner of all or may deal in the Refunded Bonds as fully and with the same rights as if it were not
the Escrow Agent.
Section 4.03. Payment to Escrow Agent. The City shall pay to the Escrow Agent
reasonable compensation for all services rendered by it hereunder and also its reasonable
expenses incurred in and about the administration and execution of the trusts hereby created and
the performance of its powers and duties hereunder, all as provided in Schedule D hereto.
ARTICLE V
MISCELLANEOUS
Section 5.01. Amendments to this Agreement. This Agreement is made for the benefit
of the holders from time to time of the Refunded Bonds and shall not be repealed, revoked,
altered or amended without the written consent of all such holders of the Refunded Bonds, the
Series 2000 Bond Insurer, the Escrow Agent, the City of Gulf Breeze and the City; provided,
however, that the City and the Escrow Agent may, without the consent of, or notice to, such
holders, but with the written consent of the Series 2000 Bond Insurer and the City of Gulf
Breeze, enter into such agreements supplemental to this Agreement which shall not adversely
affect the rights of such holders and shall not be inconsistent with the terms and provisions of
this Agreement for any one or more of the following purposes:
(a) to cure any ambiguity or formal defect or omission in this Agreement; or
(b) to grant to or confer upon the Escrow Agent for the benefit of the holders of the
Refunded Bonds any additional rights, remedies, powers or authority that may lawfully be
granted to or conferred upon the Escrow Agent.
The Escrow Agent shall be entitled to rely upon an unqualified opinion of a nationally
recognized counsel in the field of law relating to municipal bonds with respect to compliance
with this Section.
Prior to any repeal, revocation, alteration or amendment of this Agreement, the City shall
provide written notice of such proposed repeal, revocation, alteration or amendment to Standard
& Poor's Ratings Services, Moody's Investors Service, Inc. and Fitch Ratings at their addresses
set forth below:
Standard & Poor's Ratings Services
55 Water Street
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New York, New York 10041
Attn: Municipal Ratings Desk/Refunded Bonds
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Fitch Ratings
One State Street Plaza
New York, New York 10004
Section 5.02. Severability. If any one or more of the covenants or agreements provided
in this Agreement on the part of the City or the Escrow Agent to be performed should be
determined by a court of competent jurisdiction to be contrary to law, such covenant or
agreement shall be deemed and construed to be severable from the remaining covenants and
agreements herein contained and shall in no way affect the validity of the remaining provisions
of this Agreement.
Section 5.03. Agreement Binding. All the covenants, proposals and agreements in this
Agreement contained by or on behalf of the City or by or on behalf of the Escrow Agent shall
bind and inure to the benefit of their respective successors and assigns, whether so expressed or
not. The City of Gulf Breeze shall also be a third party beneficiary hereof, for the purpose of
enforcing the provisions hereof or giving consents to amendments hereto as provided herein.
Section 5.04. Notices to Escrow Agent and City. Any notice, demand, direction,
request or other instrument authorized or required by this Agreement to be given to or filed with
the Escrow Agent, the City, or the City of Gulf Breeze shall be deemed to have been sufficiently
given or filed for all purposes of this Agreement if personally delivered and receipted for, or if
sent by registered or certified United States mail, return receipt requested, addressed as follows:
(a) As to the City -
City of Miami Beach, Florida
1700 Convention Center Drive
Miami Beach, Florida 33139
Attention: Chief Financial Officer
(b) As to the Escrow Agent -
U.S. Bank National Association
200 South Biscayne Blvd., 14th Floor
Miami, FL 33131
Attention: U.S. Bank Corporate Trust Services
(c) As to the City of Gulf Breeze -
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City of Gulf Breeze, Florida
Attention: City Manager
1070 Shoreline Drive
Gulf Breeze, Florida 32561
and
Gulf Breeze Financial Services
Attn: Executive Director
315 Fairpoint Drive
Gulf Breeze, Florida 32561
With a copy to and as to the trustee for the Program Bonds -
U.S. Bank National Association
225 E. Robinson Street, Suite 250
Orlando, Florida 32801
Attn: Corporate Trust
Any party hereto may, by notice sent to the other parties hereto, designate a different or
additional address to which notices under this Agreement are to be sent.
Section 5.05. Termination. This Agreement shall terminate when all transfers and
payments required to be made by the Escrow Agent under the provisions hereof shall have been
made.
Section 5.06. Execution by Counterparts. This Agreement may be executed in several
counterparts, all or any of which shall be regarded for all purposes as one original and shall
constitute and be but one and the same instrument.
Section 5.07. Governing Law. This Agreement shall be governed by the laws of the
State of Florida.
Section 5.08. Notice of Defeasance. The City hereby irrevocably instructs the Escrow
Agent to give the registered owners of the Refunded Bonds, the MSIR and the Series 2000 Bond
Insurer, notice of defeasance of the Refunded Bonds within thirty (30) days after the
Government Obligations shall have been deposited with the Escrow Agent. Such notice of
defeasance shall be in substantially the form set forth in Schedule E attached hereto and made a
part hereof.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed by its duly authorized officers and its official seal or corporate seal, as the case may be,
to be hereunto affixed and attested as of the date first above written.
(SEAL)
Attest:
By:
City Clerk
(SEAL)
CITY OF MIAMI BEACH, FLORIDA
By:
Mayor
U.S. BANK NATIONAL
ASSOCIATION, as Escrow Agent
By:
Vice President
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SCHEDULE A
REFUNDED BONDS
Date Principal Coupon Interest Total P+I
RIL-8105 (Water/Sewer)-EDA Al
SCHEDULE B
INVESTMENT OF BOND PROCEEDS
AND OTHER MONEYS
Investment of Other Moneys
Maturity
Type of Security
Date
Investment of Bond Proceeds
Maturity
Type of Security Date
Principal
Amount Interest Rate
Principal
Amount Interest Rate
TOTAL
RIL-8105 (Water/Sewer)-EDA gl
SCHEDULE C
SCHEDULE OF PAYMENTS ON
REFUNDED BONDS
Redemption
Date Principal Interest Premium Total
TOTAL
RIL-8105 (Water/Sewer)-EDA C1
SCHEDULE D
ESCROW AGENT FEES AND EXPENSES
(i) In consideration of the services to be rendered by the Escrow Agent under the
Agreement, the City agrees to pay the Escrow Agent a fee of $ at closing and a fee
of $ on for all services to be incurred as Escrow Agent in
connection with such services, and agrees to reimburse at cost all ordinary out-of-pocket
expenses incurred by the Escrow Agent. The term "ordinary out-of-pocket expenses"
means expenses of holding, investing and disbursing the Escrow Deposit Trust Fund as
provided herein and includes, but is not limited to publication costs, postage and legal
fees as incurred.
(ii) The City also agrees to reimburse the Escrow Agent for any extraordinary expenses
incurred by it in connection with the Agreement. The term "extraordinary expenses"
includes (a) expenses arising out of the assertion of any third party to any interest in the
Escrow Deposit Trust Fund or any challenge to the validity hereof, including reasonable
attorneys' fees, (b) expenses relating to any substitution under Section 3.05 or
reinvestment under Section 3.07, and (c) expenses (other than ordinary expenses) not
occasioned by the Escrow Agent's misconduct or negligence.
(iii) The fees and expenses payable by the City under clause (i) or (ii) above shall not be paid
from the Escrow Deposit Trust Fund, but shall be paid by the City from legally available
funds of the City.
RIL-8105 (Water/Sewer)-EDA D1
SCHEDULE E
NOTICE OF DEFEASANCE
City of Miami Beach, Florida
Water and Sewer Revenue Bonds, Series 2000
Dated: August 15, 2000
Maturity Date Principal Amount Interest Rate CUSIP Number*
NOTICE IF HEREBY GIVEN that moneys have been deposited with U.S. Bank National
Association, as Escrow Agent, for the payment of the principal of, redemption premium and
interest on the outstanding bonds identified above (collectively, the "Bonds"), and such moneys,
except to the extent maintained in cash, have been invested in [direct obligations of the
Department of the Treasury of the United States of America]. U.S. Bank National Association,
as Bond Registrar for the Bonds, and the Escrow Agent have been irrevocably instructed to call
the Bonds for redemption prior to maturity, pursuant to their optional redemption provisions, on
September 1, 2010 at a redemption price equal to 101% of the principal amount thereof.
The moneys so deposited and invested as aforesaid has been calculated to be adequate to
pay, when due, the principal of, redemption premium and interest on the Bonds to and including
the redemption date described above. In accordance with Section 307 of Resolution No. 95-
21585 adopted by the Mayor and City Commission of the City of Miami Beach, Florida on May
17, 1995 (the "Bond Resolution"), the Bonds are no longer deemed to be outstanding under the
provisions of the Bond Resolution and have ceased to be entitled to any benefit or security under
the Bond Resolution other than to receive payment of principal, redemption premium and
interest from such moneys.
U.S. BANK NATIONAL ASSOCIATION,
as Escrow Agent
Dated: December _, 2009
*No representation is made as to the correctness of these CUSIP numbers either as printed on the
Bonds or contained in this Notice.
RIL-8105 (Water/Sewer)-EDA E1
CITY OF MIAMI BEACH, FLORIDA
PARTICIPATING GOVERNMENTAL UNIT
CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and
delivered by the City of Miami Beach, Florida (the "Borrower"), in connection with the execution
and delivery on the date hereof of certain Loan Agreements (hereinafter defined) pursuant to which
the City of Gulf Breeze, Florida (the "Issuer") acting by and through Beverly Zimmern, Mayor, as
Administrator, is making four loans to the Borrower of a portion of the proceeds of the Issuer's Local
Government Loan Program Floating Rate Demand Revenue Bonds, Series 1985 J (the "1985)
Bonds"), a portion of which will be refunded by the Issuer's Local Government Loan Program
Revenue Refunding Bonds, Series 2009 (the "2009 Bonds"), as further described below. The 1985)
Bonds were issued under and pursuant to a Trust Indenture dated as of December 1, 1985, as
amended and restated as of July 1, 1986, as further amended and supplemented (the "1985)
Indenture"), between the Issuer and the Trustee (hereinafter defined). The 2009 Bonds were issued
under and pursuant to a Trust Indenture dated as of December 1, 2009 (the "2009 Indenture"),
between the Issuer and the Trustee. The 1985) Indenture and the 2009 Indenture are hereinafter
collectively referred to as the "Indentures." The Borrower agrees as follows:
Section 1. Purpose of this Disclosure Certificate. This Disclosure Certificate is being
executed and delivered by the Borrower in order to assist the remarketing agent or agents for the
1985) Bonds (the "Remarketing Agent") and the underwriter for the 2009 Bonds (the "Underwriter")
in complying with SEC Rule 15c2-12(b)(5).
Section 2. Definitions. The following capitalized terms shall have the following meanings:
"Administrator" shall mean the Mayor of the Issuer or any substitute administrator selected
by the Issuer and approved by the Credit Facility Issuer (as defined in the Indentures).
"Annual Report" shall mean any Annual Report provided by the Borrower pursuant to, and
as described in, Sections 3 and 4 of this Disclosure Certificate.
"Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to
vote or consent with respect to, or to dispose of ownership of any 1985) Bonds or 2009 Bonds
(including persons holding the 1985) Bonds or 2009 Bonds through nominees, depositories or other
intermediaries), or (b) is treated as the owner of any 1985) Bonds or 2009 Bonds for federal income
tax purposes.
"Dissemination Agent" shall mean the Borrower, or any successor Dissemination Agent
designated in writing by the Borrower and which has filed with the Borrower a written acceptance of
such designation.
"Fiscal Year" shall mean the period commencing on October 1 of each year and continuing
through the next succeeding September 30, or such other period as may be prescribed by law.
"Loan" shall mean each loan made by the Issuer to the Borrower pursuant to the provisions
of the applicable Loan Agreement.
"Loan Agreements" shall mean, collectively, the Water and Sewer Loan Agreement and the
Stormwater Utility Loan Agreement.
"National Repository" shall mean the Municipal Securities Rulemaking Board, through
Electronic Municipal Market Access (http://emma.msrb.org), or any other public or private
repository or entity recognized as such by the Securities and Exchange Commission for purposes of
the Rule.
"Reporting Periods" shall mean collectively the Water and Sewer Reporting Period and the
Stormwater Utility Reporting Period.
"Repository" shall mean each National Repository and each State Repository.
"Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as the same may be amended from time to time.
"Series 1985) Bondholder" or "Holder of the 1985) Bonds" shall mean the registered owner
of any 1985) Bonds (other than the bond registrar and paying agent for the 1985) Bonds, holding the
1985) Bonds tendered to it for payment pursuant to Article III of the 1985) Indenture prior to the
purchase and payment for such 1985) Bonds).
"Series 2009 Bondholder" or "Holder of the 2009 Bonds" shall mean the registered owner of
any 2009 Bonds.
"State" shall mean the State of Florida.
"State Repository" shall mean any public or private repository or entity designated by the
State as a state repository for the purpose of the Rule and recognized as such by the Securities and
Exchange Commission. As of the date of this Disclosure Certificate, there is no State Repository.
"Stormwater Utility Loan Agreement" shall mean the Loan Agreement, dated as of
December 1, 2009, among the Trustee, the Issuer and the Borrower, relating to the Series 2009)-2
Loan, as such term is defined in the Stormwater Loan Agreement.
"Stonnwater Utility Reporting Period" shall mean, with respect to the Loan pursuant to the
Stormwater Utility Loan Agreement, from December 1, 2009, until maturity or earlier redemption of
the 1985) Bonds.
"Trustee" shall mean U.S. Bank National Association.
"Water and Sewer Loan Agreement" shall mean the Loan Agreement, dated as of December
1, 2009, among the Trustee, the Issuer and the Borrower, relating to the Series 2009)-lA Loan, the
Series 2009)-1B Loan and the Series 2009)-1C Loan, as such terms are defined in the Water and
Sewer Loan Agreement.
"Water and Sewer Reporting Period" shall mean, with respect to the Loans pursuant to the
Water and Sewer Loan Agreement, from December 1, 2009 until maturity or earlier redemption of
the 2009 Bonds.
2
Section 3. Provision of Annual Reports.
(a) During the Reporting Periods, the Borrower shall, or shall cause the Dissemination Agent
to, not later than the date which shall be 270 days after the end of the Borrower's Fiscal Year
(presently September 30), provide to each Repository an Annual Report which is consistent with the
requirements of Section 4 of this Disclosure Certificate. The Annual Report may be submitted as a
single document or as separate documents comprising a package, and may cross-reference other
information as provided in Section 4 of this Disclosure Certificate; provided that the audited
financial statements of the Borrower may be submitted separately from the balance of the Annual
Report and later than the date required above for the filing of the Annual Report if they are not
available by that date. If the Borrower's Fiscal Year changes, it shall give notice of such change in
the next Annual Report filed by the Borrower.
(b) Not later than fifteen (15) business days prior to said date, the Borrower shall provide the
Annual Report to the Dissemination Agent (if other than the Borrower). If the Borrower is unable to
provide to the Repositories an Annual Report (other than the audited financial statements described
in Section 4(a)) by the date required in Section 3(a), the Borrower shall send a notice to (i) each
National Repository and (ii) the State Repository in substantially the form attached as Exhibit A.
(c) The Dissemination Agent shall:
i. determine each year prior to the date for providing the Annual Report the
name and address of each National Repository and the State Repository, if any; and
ii. if the Dissemination Agent is other than the Borrower, file a report with the
Borrower certifying that the Annual Report has been provided pursuant to this Disclosure
Certificate, stating the date it was provided and listing all the Repositories to which it was
provided.
Section 4. Content of Annual Reports. The Borrower's Annual Report shall contain or
include by reference the following:
(a) The audited financial statements of the Borrower for the prior Fiscal Year, prepared in
accordance with generally accepted accounting principles as promulgated to apply to governmental
entities from time to time by the Governmental Accounting Standards Board. If the Borrower's
audited financial statements are not available by the time the Annual Report is required to be filed
pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format
similar to the Borrower's audited financial statements, and the audited financial statements shall be
filed in the same manner as the Annual Report when they become available.
(b) During the Water and Sewer Reporting Period, financial information and operating data for
the prior Fiscal Year concerning the Water and Sewer Utility and contained in Appendix _ to the
Issuer's Remarketing Circular relating to the 1985) Bonds dated , 2009 and in Appendix
to the Issuer's Official Statement relating to the 2009 Bonds dated , 2009 under the captions
"Historical Schedule of Net Revenue, Debt Service and Debt Coverage," "Existing Arrangements with
the County", and "Rates, Fees and Charges"; provided, however, that the Borrower's obligation to
provide such Annual Information may be satisfied by providing a copy of the Borrower's
comprehensive annual financial report to the extent that the Annual Information is contained therein.
3
(c) During the Stormwater Utility Reporting Period, financial information and operating data
for the prior Fiscal Year concerning the Water and Sewer Utility and contained in Appendix _ to the
Issuer's Remarketing Circular relating to the 1985) Bonds dated , 2009 under the captions
"Historical Schedule of Net Revenue, Debt Service and Debt Coverage" and "Rates, Fees and
Charges"; provided, however, that the Borrower's obligation to provide such Annual Information may
be satisfied by providing a copy of the Borrower's comprehensive annual financial report to the extent
that the Annual Information is contained therein.
The obligation to provide the information under Section 4(a), Section 4(b) and Section 4(c) may be
satisfied by providing a copy of the Borrower's comprehensive annual financial report to the extent
the information required by Section 4(a), Section 4(b) and Section 4(c) is contained therein. The
information provided under Section 4(b) and Section 4(c) may be included by specific reference to
other documents which have been submitted to each of the Repositories or the Securities and
Exchange Commission. If the document included by reference is a final official statement,
remarketing circular or remarketing supplement, it must be available from the Municipal Securities
Rulemaking Board. The Borrower shall clearly identify each such other document so included by
reference.
Section 5. Dissemination Agent. The Borrower may, from time to time, appoint or engage a
Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and
may discharge any such Dissemination Agent, with or without appointing a successor Dissemination
Agent. The Dissemination Agent shall not be responsible in any manner for the content of any
notice or report prepared by the Borrower pursuant to this Disclosure Certificate.
Section 6. Amendment: Waiver. Notwithstanding any other provision of this Disclosure
Certificate, the Borrower may amend this Disclosure Certificate, and any provision of this Disclosure
Certificate may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiver relates to the provisions of Sections 3(a) and 4, it may only
be made in connection with a change in circumstances that arises from a change in legal
requirements, change in law, or change in the identity, nature or status of the Borrower, or the type
of business conducted;
(b) The undertaking, as amended or taking into account such waiver, would, in the opinion
of nationally recognized bond counsel, have complied with the requirements of the Rule as of
December 1, 2009, after taking into account any amendments or interpretations of the Rule, as well
as any change in circumstances; and
(c) The amendment or waiver either (i) is approved by (x) the Holders of the 1985) Bonds
and the 2009 Bonds or (y) the Holders of the 1985) Bonds or the 2009 Bonds as it relates solely to
such 1985) Bonds or 2009 Bonds, respectively, in the same manner as provided in the respective
Indentures for amendments to such Indenture with the consent of Holders, or (ii) does not, in the
opinion of nationally recognized bond counsel, materially impair the interests of the Holders or
Beneficial Owners of 1985) Bonds or the 2009 Bonds, as applicable.
In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Borrower
shall describe such amendment in the next Annual Report, and shall include, as applicable, a
narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the
4
case of a change of accounting principles, on the presentation) of financial information or operating
data being presented by the Borrower. In addition, if the amendment relates to the accounting
principles to be followed in preparing financial statements, (i) notice of such change shall be given in
the Annual Report for the year in which the change is made and such Annual Report should present a
comparison (in narrative form and also, if feasible, in quantitative form) between the financial
statements as prepared on the basis of the new accounting principles and those prepared on the basis
of the former accounting principles.
Section 7. Additional Information. Nothing in this Disclosure Certificate shall be deemed to
prevent the Borrower from disseminating any other information, using the means of dissemination
set forth in this Disclosure Certificate or any other means of communication, or including any other
information in any Annual Report, in addition to that which is required by this Disclosure
Certificate. If the Borrower chooses to include any information in any Annual Report in addition to
that which is specifically required by this Disclosure Certificate, the Borrower shall have no
obligation under this Disclosure Certificate to update such information or include it in any future
Annual Report.
Section 8. Default. In the event of a failure of the Borrower to comply with any provision of
this Disclosure Certificate the Trustee may (and at the request of the Remarketing Agent, the Issuer
or the Holders of at least 25% aggregate principal amount of Outstanding 1985) Bonds or 2009
Bonds, shall), or the Issuer or any Holder or Beneficial Owner of the 1985) Bonds or 2009 Bonds
may, take such actions as may be necessary and appropriate, including seeking mandamus or specific
performance by court order, to cause the Borrower to comply with its obligations under this
Disclosure Certificate; provided, however, the sole remedy under this Disclosure Certificate in the
event of any failure of the Borrower to comply with this Disclosure Certificate shall be an action to
compel performance. Action taken pursuant to this Section 8 by the Issuer shall be deemed to relate
to the 1985) Bonds and 2009 Bonds, collectively, unless otherwise specified. Action taken pursuant
to this Section 8 by (i) a Holder or Beneficial Owner of the 1985) Bonds or 2009 Bonds or (ii) the
Trustee, at the request of the Remarketing Agent of the 1985) Bonds or the Underwriter of the 2009
Bonds or Holders of at least 25% aggregate principal amount of Outstanding 1985) Bonds or 2009
Bonds, shall relate solely to the 1985) Bonds or 2009 Bonds, respectively. A default under this
Disclosure Certificate shall not be deemed an Event of Default under the Indentures or the Loan
Agreements.
Section 9. Duties, Immunities and Liabilities of Dissemination A ent. The Dissemination
Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the
Borrower agrees to indemnify and save the Dissemination Agent, its officers, directors, employees
and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in
the exercise or performance of its powers and duties hereunder, including the costs and expenses
(including attorneys' fees) of defending against any claim of liability, but excluding liabilities due to
the Dissemination Agent's negligence or willful misconduct. The obligations of the Borrower under
this Section 9 shall survive resignation or removal of the Dissemination Agent and the termination of
the obligations of the Borrower under this Disclosure Certificate.
5
Section 10. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the
Issuer, the Borrower, the Dissemination Agent, the Remarketing Agent and Holders and Beneficial
Owners from time to time of the 1985) Bonds and 2009 Bonds, and shall create no rights in any
other person or entity.
Date: December 1, 2009.
CITY OF MIAMI BEACH, FLORIDA
By:
Patricia Walker, Chief Financial Officer
6
EXHIBIT A
NOTICE OF FAILURE TO FILE ANNUAL REPORT
Name of Borrower: City of Miami Beach, Florida
Name of Bond Issue: [1985) Bonds or 2009 Bonds]
Date of Issuance: [December 30, 1985] [December 1, 2009]
NOTICE IS HEREBY GIVEN that the Borrower has not provided an annual report with
respect to the above-referenced [ 1985) Bonds] [2009 Bonds] as required by Sections 3 and 4 of the
Continuing Disclosure Certificate dated December 1, 2009, executed and delivered by the Borrower
in connection with loans to the Borrower of portions of the proceeds of the [Series 1985) Bonds]
[certain bonds which were refunded by the 2009 Bonds], pursuant to two Loan Agreements each
dated as of December 1, 2009, between U.S. Bank, National Association, as trustee, the City of Gulf
Breeze, Florida, acting by and through Beverly Zimmern, Mayor, as Administrator, and the
Borrower. [The Borrower anticipates that the annual report will be filed by
Dated:
CITY OF MIAMI BEACH, FLORIDA
By:
Its:
A-1