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81-89 RDA RESOLUTION NO. 81-89 A RESOLUTION AMENDING AND RESTATING RESOLU- TION NO. 78-7, ADOPTED BY THE MIAMI BEACH REDEVELOPMENT AGENCY ON AUGUST 8, 1978, AS AMENDED, IN ITS ENTIRETY; AUTHORIZING THE ISSUANCE OF NOT MORE THAN $7,000,000 IN AGGREGATE PRINCIPAL AMOUNT OF MIAMI BEACH REDEVELOPMENT AGENCY TAX INCREMENT REVENUE BONDS, SERIES 1989, FOR THE PURPOSE OF FINANCING THE ACQUISITION AND CLEARING OF CERTAIN PROPERTY AND THE CONSTRUCTION OF CERTAIN RELATED PUBLIC IMPROVEMENTS; PLEDGING THE REVENUES DEPOSITED TO THE REDEVELOPMENT TRUST FUND AND CERTAIN OTHER MONEYS TO THE PAYMENT OF SAID BONDS; PROVIDING FOR THE ISSUANCE OF ADDITIONAL BONDS ON A PARITY THEREWITH; PROVIDING FOR THE RIGHTS AND SECURITY OF ALL BONDS ISSUED PURSUANT TO THIS RESOLUTION; PROVIDING CERTAIN DETAILS OF THE SERIES 1989 BONDS; DELEGATING CERTAIN MATTERS IN CONNECTION WITH THE ISSUANCE OF THE SERIES 1989 BONDS TO THE CHAIRMAN OF THE AGENCY; APPROVING THE FORM AND EXECUTION OF THE PRIVATE PLACEMENT AGREEMENT AND COMMITMENT LETTER FOR THE SERIES 1989 BONDS; APPROVING THE FORM OF PRELIMINARY PRIVATE PLACEMENT MEMORANDUM FOR THE SERIES 1989 BONDS AND AUTHORIZING EXECU- TION OF THE FINAL PRIVATE PLACEMENT MEMO- RANDUM FOR THE SERIES 1989 BONDS; AUTHO- RIZING OFFICIALS OF THE AGENCY TO TAKE ALL NECESSARY ACTIONS IN CONNECTION WITH THE ISSUANCE OF THE SERIES 1989 BONDS; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the Miami Beach Redevelopment Agency (the "Agency"), a public body corporate and politic, has been duly created and established to transact business and exercise powers under and pursuant to the Flor ida Communi ty Redevelopment Act, Chapter 163, Part III, Florida Statutes (together with other applicable provisions of law, the "Act"), including the issuance of revenue bonds, in order to achieve the purposes of redevelop- ment as set forth in the Act; WHEREAS, all the requirements of law have been complied with in the creation of the Agency, the adoption of a redevelopment plan under the Act for a portion of the City of Miami Beach (the "City") as described in said redevelopment plan (the "Redevelop- ment Area"), as the same has been amended from time to time and now known as the "South Shore Revitalization Strategy" (the "Redevelopment Plan") and the creation and funding of a Rede- velopment Trust Fund (the "Trust Fund") by the Ci ty and Dade County, Florida (the "County") in accordance with the Act; WHEREAS, the Agency had on August 8, 1978 adopted Resolution No. 78-7, as amended on June 4, 1979 by Resolution No. 79-7 (the "Original Bond Resolution"), which authorized the issuance of not exceeding $300,000,000 revenue bonds in connection with the Redevelopment Plan; WHEREAS, the Agency now desires to finance the acquisition and clearing of certain property and the construction of certain related public improvements in accordance with the Redevelopment Plan (the "Series 1989 Redevelopment Project") by issuing its Tax Increment Revenue Bonds, Series 1989 (the "Series 1989 Bonds"); 3 WHEREAS, because of changes ln the Federal tax laws governing the issuance of tax-exempt debt and market developments since 1978, it is now necessary to amend and res ta te in its entirety the Original Bond Resolution in order to provide for the issuance of the Series 1989 Bonds; WHEREAS, the Agency also desires to set forth the provisions pursuant to which it may issue bonds on a parity with the Series 1989 Bonds and to make provision for the rights and security of the holders of all bonds issued hereunder; and WHEREAS, the Board of Commissioners of the Agency (the "Commission") has determined that it is in the best interest of the Agency to delegate to the Chairman of the Agency the determi- nation of various terms of the Series 1989 Bonds, the award of the Series 1989 Bonds, including execution of a private placement agreement and a commitment letter for the Series 1989 Bonds, and all other actions necessary or desirable in connection with the issuance of the Series 1989 Bonds, subject to the limitations herein; and WHEREAS, for reasons more fully set forth herein, the Agency finds and determines it to be in the best interests of the Agency to authorize the sale of the Series 1989 Bonds on the basis of a negotiated sale (including private placement) rather than a public sale by competitive bid; NOW THEREFORE, BE IT DULY RESOLVED BY THE MIAMI BEACH REDEVELOPMENT AGENCY. ARTICLE I DEFINITIONS, AUTHORITY AND FINDINGS; RESOLUTION CONSTITUTES A CONTRACT SECTION 101. DEFINITIONS. As used in this Resolution, the following terms shall have the following meanings: "Accreted Value" shall mean, as of any date of computation with respect to any Capital Appreciation Bond, an amount equal to the principal amount of such Capital Appreciation Bond (the prin- cipal amount at its initial offering) plus the interest accrued on such Capi tal Appreciation Bond from the date of delivery to the original purchasers thereof to the Interest Payment Date next preceding the date of computation or the date of computation if an Interest Payment Date, such interest to accrue at a rate not exceeding the legal rate as set forth in the resolution of the Commission providing for the issuance of such Bonds, compounded periodically, plus, with respect to matters related to the pay- ment upon redemption or acceleration of the Capital Appreciation Bonds, if such date of computation shall not be an Interest Pay- ment Date, a portion of the difference between the Accreted Value as of the immediately preceding Interest Payment Date (or the date of original issuance if the date of computation is prior to the first Interest Payment Date succeeding the date of original issuance) and the Accreted Value as of the immediately succeeding Interest Payment Date, calculated based on the assumption that Accreted Value accrues in equal daily amounts on the basis of a year of twelve 30-day months. "Act" shall mean the Flor ida Community Redevelopment Act, Chapter 163, Par t I I I, Flor ida Statutes, as amended, and other applicable provisions of law. "Agency" shall mean the Miami Beach Redevelopment Agency, a body corporate and politic, created pursuant to the Act. - 2 - 4 "Amortization Requirements" shall mean such moneys required to be deposited in the Bond Redemption Account for the purpose of the mandatory redemption or payment at maturity of any Term Bonds, the specific amounts of such deposits to be determined by the Chairman in the Chairman I s Certificate wi th respect to the Series 1989 Bonds and by the Commission in the resolution autho- rizing any other Series of Bonds. "Annual Debt Service Requirement" for any period, as applied to the Bonds of any Ser ies, shall mean the respective amounts which are needed to provide: (a) for paying the interest on all Bonds of such Ser ies then Outstanding which is payable on each Interest Payment Date in such period, (b) for paying the principal of all Serial Bonds of such Series then Outstanding which is payable upon the matu- rity of such Serial Bonds in such period, and (c) the Amortization Requirements, if any, for the Term Bonds of such Series for such period. For purposes of computing (a), (b) and (c) above, any principal, interest or Amortization Requirements due on October 1 in a Fiscal Year shall be deemed due in the preceding Fiscal Year. The following rules shall apply in determining the amount of the Annual Debt Service Requirement for any period: (a) The interest rate on Var iable Rate Bonds shall be assumed to be 110% of the greater of (i) the daily average interest rate on such Variable Rate Bonds during the twelve months ending wi th the month preceding the date of calculation or such shorter period that such Variable Rate Bonds shall have been Outstanding under this Resolution, and (ii) the actual rate of interest on such Variable Rate Bonds on the date of calculation; (b) In the case of Put Bonds, the "put" date or dates shall be ignored if the source for payment of said "put" is a Credit Facility or a Liquidity Facility and the stated dates for Amortization Requirements and principal payments shall be used, and in the case of Bonds secured by a Credit Facility or a Liquidity Facility, the terms of the reimbursement obligation to the issuers thereof shall be ignored and the stated dates for Amortization Requirements for Term Bonds and principal payments shall be used; pro- vided, however, that during any period of time after the issuer of a Credi t Faci I i ty or a Liquidi ty Faci 1 i ty has advanced funds thereunder, the reimbursement obligation of which is payable from and secured on a parity with the Bonds and before such amount is repaid, Annual Debt Service Requirements shall include the principal amount so advanced and interest thereon, in accordance with the principal repayment schedule and interest rate or rates specified in the Credit Facility or Liquidity Facility, in lieu of the stated principal of and Amortization Requirements and inter- est on such Bonds; (c) In the case of Extendible Maturity Bonds, the Bonds shall be deemed to mature on the later of the stated maturity date or the date to which such stated maturity date has been extended; (d) principal In the case of Capital Appreciation Bonds, the and interest portions of the Accreted Value of - 3 - c- .) Capital Appreciation Bonds becoming due at maturity or by virtue of an Amortization Requirement shall be included in the calculations of accrued and unpaid Annual Debt Service Requirements in the year in which said principal and inter- est portions are due and payable; (e) In the case of Capital Appreciation and Income Bonds, the principal and interest portions of the Appreci- ated Value of Capital Appreciation and Income Bonds shall be included in the calculations of accrued and unpaid Annual Debt Service Requirements in the year in which said princi- pal and interest portions are due and payable; (f) In the case of Balloon Bonds or Inter im Bonds, the debt service requirements of the Balloon Bonds or Interim Bonds may be excluded and in lieu thereof the Bal- loon Bonds or Interim Bonds shall be viewed, for purposes of the computation of Annual Debt Service Requirements, as debt secur i ties having a comparable Federal tax status as such Balloon Bonds or Interim Bonds, hypothetically maturing in substantially equal annual payments of principal and inter- est over a period of not more than 15 years from the date of issuance thereof, bearing interest at a fixed rate per annum equal to the average interest rate per annum for such debt securities on the date of issuance of the Balloon Bonds or Interim Bonds and issued by issuers having a credit rating, issued by Moody's Investors Services, Inc. or any successors thereto or Standard & Poor's Corporation or any successors thereto comparable to that of the Agency, as shown by a cer- tificate of an underwriting or investment banking firm experienced in marketing such securities; and (g) If all or a portion of the pr incipal of or interest on a Series of Bonds is payable from funds irrevoc- ably set aside or deposited for such purpose, together with projected earnings thereon to the extent such earnings are projected to be from Permitted Investments, such principal or interest shall not be included in determining Annual Debt Service Requirements. "Appreciated Value" shall mean (i) as of any date of compu- tation with respect to any Capital Appreciation and Income Bond up to the Interest Commencement Date set forth in the resolution of the Commission providing for the issuance of such Bond, an amount equal to the principal amount of such Bond (the principal amount at its initial offering) plus the interest accrued on such Capital Appreciation and Income Bond from the date of delivery to the original purchasers thereof to the Interest Payment Date next preceding the date of computation or the date of computation if an Interest Payment Date, such interest to accrue at a rate not exceeding the legal rate as set forth in the resolution of the Commission providing for the issuance of such Bonds, compounded periodically, plus, with respect to the payment upon redemption or acceleration of the Capital Appreciation and Income Bonds, if such date of computation shall not be an Interest Payment Date, a portion of the difference between the Appreciated Value as of the immediately preceding Interest Payment Date (or the date of orig- inal issuance if the date of computation is prior to the first Interest Payment Date succeeding the date of original issuance) and the Appreciated Value as of the immediately succeeding Interest Payment Date calculated based upon an assumption that Appreciated Value accrues in equal daily amounts on the basis of a year of twelve 30-day months and (ii) as of any date of compu- tation on and after the Interest Commencement Date, the Appreci- ated Value on the Interest Commencement Date. - 4 - 6 "Average Annual Debt Service" shall mean, at any time and wi th respect to all of the Bonds or any particular Ser ies of Bonds (as appropriate), the sum of the Annual Debt Service Requirements for the then current and every succeeding Fiscal Year divided by the number of such Fiscal Years. "Balloon Bonds" shall mean any Bonds issued under this Reso- lution, interest on which is payable periodically and twenty five percent (25%) or more of the original principal amount of which matures during anyone Fiscal Year and for which maturing princi- pal amount Amortization Requirements have not been designated in the resolution of the Commission authorizing the issuance of such Bonds. "Bonds" shall mean the Series 1989 Bonds, authorized to be issued pursuant to this Resolution, together with any additional parity Bonds hereafter issued pursuant to this Resolution. "Bondholder", "Holder", "Holder of Bonds" or "Owner" or any similar term, shall mean any person, who shall be the registered owner of any Outstanding Bond or Bonds. "Capital Appreciation Bonds" shall mean any Bonds issued under this Resolution as to which interest is compounded periodi- cally on each of the applicable per iodic dates designated for compounding and payable in an amount equal to the then current Accreted Value only at the maturity, earlier redemption or other payment date therefor, all as so designated by subsequent pro- ceedings of the Commission relating to the issuance thereof, and which may be either Serial Bonds or Term Bonds. "Capital Appreciation and Income Bonds" shall mean any Bonds issued under this Resolution as to which accruing interest is not paid prior to the Interest Commencement Date specified in the resolution authorizing such Bonds and the Appreciated Value for such Bonds is compounded periodically on certain designated dates prior to the Interest Commencement Date for such Series of Capi- tal Appreciation and Income Bonds, all as so designated by subse- quent proceedings of the Commission relating to the issuance thereof and which may be either Serial Bonds or Term Bonds. "Chairman" shall mean the Chairman of the Agency or in the absence or disability of the Chairman, the Vice Chairman of the Agency or the officers succeeding to their principal functions. "Chairman's Certificate" shall mean the Certif ica te to be executed by the Chairman prior to or at the time of the execution of the Commitment Letter (as defined in Section 201 hereof), which Certificate shall provide the details of the Series 1989 Bonds. "City" shall mean the City of Miami Beach, Florida. "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated there- under and applicable regulations promulgated under the Internal Revenue Code of 1954, as amended. "Commission" shall mean the Board of Commissioners of the Agency. "County" shall mean Dade County, Florida. "Credit Facility" shall mean an irrevocable letter of cred- it, policy of municipal bond insurance, guaranty, purchase agree- ment, credit agreement or similar facility in which the entity providing such facility irrevocably agrees to provide funds to make payment of the principal of, premium, if any and interest on Bonds. - 5 - ~, "Defeasance Obligations" shall mean to the extent permitted by law: (a) Direct general obligations of, or obligations the payment of the pr incipal of which and the interest on which is unconditionally guaranteed by, the United States of America; and (b) Evidences of indebtedness issued by the Bank for Cooperati ves, Federal Home Loan Banks, Federal Home Loan Mortgage Corporation (including participation certificates), Federal Land Banks, Federal Financing Banks, or any other agency or instrumentali ty of the Uni ted States of Amer ica created by an act of Congress which is substantially similar to the foregoing in its legal relationship to the Uni ted States of Amer ica; provided that the obligations of such agency or instrumentality are unconditionally guaranteed by the United States of America or any other agency or instru- mentality of the United States of America; and (c) Evidences of ownership of proportionate inter- ests in future interest and principal payments on specified obligations described in (a) above held by a bank or trust company as custodian, under which the owner of the invest- ment is the real party in interest and has the right to proceed directly and individually against the obligor on the underlying obligations described in (a) above, and which underlying obligations are not available to satisfy any claim of the custodian or any person claiming through the custodian or to whom the custodian may be obligated; and (d) Obligations described in Section 103(a) of the Code which do not permit redemption prior to maturity at the option of the obligor and provision for the payment of the principal of, premium, if any, and interest on which shall have been made by the irrevocable deposi t wi th a bank or trust company acting as a trustee or escrow agent for holders of such obligations or securities described in clauses (a) or (b) above, the maturing principal of and interest on which, when due and payable, will provide sufficient monies to pay when due the principal of, premium if any, and interest on such obligations, and which securi- ties described in clauses (a) or (b) above are not available to satisfy any other claim, including any claim of the trustee or escrow agent or of any person claiming through the trustee or escrow agent or to whom the trustee or escrow agent may be obligated, including in the event of the insolvency of the trustee or escrow agent or proceedings arising out of such insolvency. "Executive Director" shall mean the Execut i ve Di rector of the Agency. "Extendible Maturity Bonds" shall mean Bonds the maturities of which, by their terms, may be extended by and at the option of the Holders of the Bonds or the Agency. "Fiduciaries" shall mean the paying Agent, the Registrar and the Trustee appointed and acting under this Resolution. "Fiscal Year" shall mean that period commencing on October 1, and continuing to and including the next succeeding September 30, or such other annual period as may be prescribed by law or by the Agency in accordance with law. "Interest Commencement Date" shall mean, with respect to any particular Capital Appreciation and Income Bonds, the date speci- - 6 - ,~ fied in the resolution providing for the issuance of such Bonds, (which date must be prior to the maturity date for such Bonds) after which interest accruing on such Bonds shall be payable semi-annually or otherwise on a periodic basis prior to maturity, with the first such payment date being the applicable Interest Payment Date immediately succeeding such Interest Commencement Date. "Interest Payment Date" shall mean for each Series of Bonds such dates of each Fiscal Year on which interest on the Bonds is payable on any Bonds that are Outstanding, as set forth in the proceedings of the Agency providing for the issuance of such Series of Bonds. "Interim Bonds" shall mean any Bonds issued under this Reso- lution on an interim basis which are expected to be repaid from the proceeds of Bonds or other indebtedness. "Liquidity Facility" shall mean a letter of credit, line of credi t, policy of municipal bond insurance, guaranty, purchase agreement or similar facility in which the entity providing such facility agrees to provide funds to pay the purchase price of Put Bonds upon their tender by the Holders of Put Bonds. "Maximum Annual Debt Service" shall mean, at any time and with respect to all of the Bonds or any particular Series of the Bonds (as appropriate), the greatest Annual Debt Service Require- ment in the then current or any succeeding Fiscal Year. "Outstanding" when used wi th reference to the Bonds, shall mean, as of any date of determination, all Bonds theretofore authenticated and delivered except; (a) Bonds theretofore cancelled by the Registrar or delivered to the Registrar for cancellation; (b) Bonds which are deemed paid and no longer Out- standing as provided herein; (c) Bonds in lieu of which other Bonds have been issued pursuant to the provisions hereof relating to Bonds destroyed, stolen or lost, unless evidence satisfactory to the Registrar has been received that any such Bond is held by a bona fide purchaser; and (d) For purposes of any consent or other action to be taken hereunder by the Holders of a specified percentage of pr incipal amount of Bonds, Bonds held by or for the account of the Agency. "Paying Agent" shall mean any bank or trust company or any successor bank or trust company appointed by the Agency to act as Paying Agent hereunder. "Permitted Investments" shall mean and include such obliga- tions as shall be permitted to be legal investments of the Agency by the laws of the State. "Placement Agents" shall mean Chase Securities, Inc., Lazard Freres & Co., and paineWebber Incorporated. "Pledged Funds" shall mean, collectively, the Trust Fund Revenues and, except for moneys, securities and instruments in the Rebate Fund, all moneys, securities and instruments held in the Funds and Accounts created and established by this Resolu- tion. - 7 - !} "Put Bonds" shall mean the Bonds which by their terms may be tendered by and at the option of the owner thereof for payment by the Agency prior to the stated maturity thereof. "Redevelopment Area" shall mean the area within the City found by the City to be a "blighted area" within the meaning of the Act and described in the Redevelopment Plan. "Redevelopment Plan" shall mean the redevelopment plan originally approved by the City on March 2, 1977 as the same has been or may hereafter be amended from time to time and now known as the "South Shore Revitalization Strategy." "Redevelopment Projects" shall mean the particular community redevelopment projects undertaken by the Agency pursuant to the Redevelopmen t Plan in accordance wi th the Act, including the Series 1989 Redevelopment Project. "Registrar" shall mean the officer of the Agency or a bank or trust company appointed by the Agency, located within or with- out the State of Florida, who or which shall maintain the regis- tration books of the Agency and be responsible for the transfer and exchange of the Bonds, and who or which may also be the Paying Agent and the Trustee for the Bonds. "Reserve Account Insurance Policy" shall mean the insurance policy, surety bond or other acceptable evidence of insurance, if any, deposited in the Debt Service Reserve Account in lieu of or in partial substitution for cash or securities on deposit there- in. The issuer providing such insurance shall be a municipal bond insurer rated, at the time of deposit in the Debt Service Reserve Account, in any of the three highest rating categories of either Moody's Investors Service, Inc. or any successors thereof or Standard & Poor's Corporation or any successors thereof. "Reserve Account Letter of Credit" shall mean the irrevoc- able, transferable letter of credit, if any, deposited in the Debt Service Reserve Account in lieu of or in partial substitu- tion for cash or securities on deposit therein. The issuer pro- viding such letter of credit shall be a banking association, bank or trust company or branch thereof rated, at the time of deposit into the Debt Service Reserve Account, in any of the three high- est rating categor ies of ei ther Moody's Investors Service, Inc. or any successors thereof or Standard & Poor's Corporation or any successors thereof. "Reserve Account Requirement" shall mean the lesser of (i) Maximum Annual Debt Service on all Bonds Outstanding, (ii) 125% of Average Annual Debt Service on all Bonds Outstanding, or (iii) 10% of the proceeds of the Bonds within the meaning of the Code. "Resolution" shall mean this Resolution as the same may from time to time be amended and supplemented in accordance with the terms hereof. "Ser ial Bonds" shall be stated to including Term Bonds. shall mean mature in the Bonds of any Ser ies which annual installments but not "Series" shall mean all of the Bonds authenticated and delivered on original issuance and pursuant to this Resolution or any supplemental resolution authorizing such Bonds as a separate Series of Bonds, or any Bonds thereafter authenticated and deliv- ered in lieu of or in substitution for such Bonds pursuant to Article II hereof, regardless of variations in maturity, interest rate or other provisions. - 8 - 10 "Series 1989 Bonds" shall mean the Tax Increment Revenue Bonds, Series 1989 authorized to be issued under this Resolution in the aggregate principal amount not to exceed $7,000,000. "Series 1989 Redevelopment Project" shall mean the acquisi- tion and clear ing of certain property and the construction of certain related public improvements within the Redevelopment Area being financed wi th the proceeds of the Ser ies 1989 Bonds, as more specifically described in Exhibit A attached hereto and made a part hereof. "State" shall mean the State of Florida. "Term Bonds" shall mean the Bonds of any Series which shall be stated to mature on one date and for the amortization of which payments are required to be made into the Bond Redemption Account in the Sinking Fund. "Trust Fund" shall mean the redevelopment trust fund established by Ordinance No. 77-2104 adopted by the City on September 7, 1977, as amended, in accordance with the Act. "Trust Fund Revenues" shall mean the revenues received by the Agency for deposit in the Trust Fund pursuant to Section 163.387, Florida Statutes, as amended, Ordinance No. 78-20, enacted by the County on April 4, 1978, as amended, and Ordinance No. 77-2104, adopted by the City on September 7, 1977, as amended. "Trustee" shall mean any bank or trust company or any successor bank or trust company appointed by the Agency to act as Trustee hereunder, and which may also be the Paying Agent and Registrar for the Bonds. "Variable Rate Bonds" shall mean Bonds, which may be either Serial Bonds or Term Bonds, issued with a variable, adjustable, convertible or other similar rate which is not fixed in percent- age for the entire term thereof at the date of issue. words importing singular number shall include the plural number in each case and vice versa, and words importing persons shall include firms and corporations. Words def ined in Section 101 hereof that appear in this Resolution in lower case form shall have the meanings ascr ibed to them in the def ini t ions in Section 101 unless the context shall otherwise indicate. The words "Bond", "Owner", "Holder" and "person" shall include the plural as well as the singular number unless the context shall otherwise indicate. The word "person" shall include corporations and associations, including public bodies, as well as natural persons, unless the context shall otherwise indicate. The word "Bond" or "Bonds" and the words "revenue bond" or "revenue bonds" shall mean any Bond or Bonds or all of the Bonds, as the case may be, issued under the provisions of this Resolution. The word "Resolution" shall include this Resolution and each resolution supplemental hereto. SECTION 102. AUTHORITY FOR THIS RESOLUTION. This resolu- tion is adopted pursuant to the provisions of the Act. SECTION 103. FINDINGS. mined and declared: It is hereby ascertained, deter- (a) That the Agency is authorized to receive and deposit in the Trust Fund the Trust Fund Revenues pursuant to the Act. - 9 - 11 (b) It is necessary Series 1989 Bonds in order Redevelopment Project. and to desirable finance the to issue Series the 1989 (c) The principal of and interest on the Bonds and all required sinking fund, reserve and other payments shall be payable solely from the Pledged Funds. None of the City, the County, or the State of Florida or any political sub- division thereof or governmental authority or body therein shall ever be required to levy ad valorem taxes to pay the principal of or interest on the Bonds or to make any of the sinking fund, reserve or other payments required by this Resolution or the Bonds, and the Bonds shall not constitute indebtedness of the Agency or the City within the meaning of any constitutional, statutory or other provision or limita- tion or a lien upon any property owned by or situated within the corporate territory of the Agency or the City, except as provided herein with respect to the Pledged Funds. (d) Due to the character of the Ser ies 1989 Bonds, the complexity of structuring an issue of bonds secured by the Trust Fund Revenues, prevailing market conditions, and the recommendation of the financial advisor to the Agency that the sale of the Series 1989 Bonds be by negotiation, the sale of the Series 1989 Bonds on the basis of negotiated sale (including private placement) rather than a public sale by competitive bid is in the best interest of the Agency and is hereby authorized. SECTION 104. RESOLUTION CONSTITUTES CONTRACT. In conside- ration of the acceptance of the Bonds author ized to be issued hereunder by those who shall own the same from time to time, this Resolution shall be deemed to be and shall constitute a contract between the Agency and such Bondholders, and the covenants and agreements herein set forth to be performed by the Agency shall be for the equal benefit, protection and security of the owners of any and all of such Bonds, all of which shall be of equal rank and wi thout preference, pr ior i ty, or distinction of any of the Bonds over any other thereof except as expressly provided therein and herein. [END OF ARTICLE I] - 10 - 12 ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF BONDS SECTION 201. AUTHORIZATION OF THE SERIES 1989 BONDS. Sub- ject and pursuant to the provisions of this Resolution, Bonds of the Agency to be known as Tax Increment Revenue Bonds, Ser ies 1989 (the "Ser ies 1989 Bonds"), are hereby author ized to be issued in an aggregate principal amount not to exceed Seven Million Dollars ($7,000,000), for the purpose of providing funds, together wi th certain other available moneys, to finance the acquisition and clearing of certain property and the construction of certain related public improvements within the Redevelopment Area, as more specifically described in Exhibit A hereto, to fund the Debt Service Reserve Account and to pay costs of issuance of the Series 1989 Bonds, which Bonds may be issued all at one time or from time to time in Series, and if in Series, may be dated, numbered, and designated as to Series, all as shall be determined in the Chairman's Certificate. Subject to the limitations contained herein, the Series 1989 Bonds shall be issued in such aggregate amount, shall be in such denominations, shall be dated, shall mature on December 1, in such years, but not later than December 1, 2005, and in such amounts, shall be in the form of Serial Bonds or Term Bonds or a combination thereof, shall have Interest Payment Dates of June 1 and December 1 in each year, commencing December 1, 1989, shall bear interest at such rates not to exceed 11%, shall have such Amortization Requirements, shall be subject to redemption at such times, at such prices and pursuant to such notice provisions, as shall be set forth in the Chairman's Certificate. The Commission hereby appoints Southeast Bank, N.A., Miami, Florida, as Trustee, Registrar and Paying Agent hereunder. The Commission hereby approves the distribution of copies of the Preliminary Private Placement Memorandum with respect to the Series 1989 Bonds (the "Preliminary Private Placement Memo- randum") in substantially the form presented at this meeting with such changes as may be approved by the Chairman. The Chairman and the Executive Director or his designee, are hereby authorized to execute the Private Placement Memorandum with respect to the Series 1989 Bonds (the "Private Placement Memorandum") on behalf of the Agency, in substantially the form of the draft of the Preliminary Private Placement Memorandum presented at this meeting with such changes therein as shall be necessary to evi- dence the terms of the Ser ies 1989 Bonds and such addi tional changes as may be approved by the Chairman, with such execution to constitute conclusive evidence of such officers' approval and the Agency I s approval of any change therein. The use of the Preliminary pr i va te Placement Memorandum and the final Pr i va te Placement Memorandum in the marketing and sale of the Series 1989 Bonds is hereby approved. The Commission hereby approves the forms of the Private Placement Agreement (the "Private Placement Agreement") for the placement of the Series 1989 Bonds by the Placement Agents and the Commitment Letter (the "Commitment Letter") for the purchase of the Series 1989 Bonds by the purchasers, copies of which draft forms of the Pr i vate Placement Agreement and Commi tment Let ter have been presented at this meeting. In connection wi th the placement and sale of the Ser ies 1989 Bonds, the Chai rman is hereby authorized to execute the Private Placement Agreement and, upon compliance by the Placement Agents with any and all appli- cable requi rements of Flor ida S ta tu tes, Section 218.385 ( 4), the Commi tment Letter, in substantially the forms presented at this - 11 - 13 meet ing, subject to such changes, insertions and omissions and such filling-in of blanks therein as may be necessary to evidence the terms of the Series 1989 Bonds and such additional changes as may be approved by the Chairman. The purchase price at which the Ser ies 1989 Bonds shall be awarded shall equal the par amount thereof. The fee to be paid by the Agency to the Placement Agents for placing the Series 1989 Bonds shall not exceed 2% of the par amount of the Series 1989 Bonds. The execution and delivery by the Chairman of the Private Placement Agreement and the Commitment Letter for and on behalf of the Agency shall be conclusive evidence of the approval of such officer and the Agency of any such changes, insertions, omissions or filling-in of blanks. The financing of the Series 1989 Redevelopment Project and its acquisition, including the exercise of eminent domain to the extent necessary, is hereby authorized. SECTION 202. DESCRIPTION OF BONDS. Unless otherwise speci- fied by the Agency in subsequent proceedings, any Bonds issued pursuant to this Resolution shall be issued in fully registered form and, if the Registrar issues notice of the availability of exchanging registered Bonds for coupon Bonds, in coupon form. If the Registrar receives an opinion of counsel of recognized stand- ing in the field of law relating to municipal bonds to the effect that the issuance of any of the Bonds in coupon form will not adversely affect the exclusion from gross income for Federal income tax purposes of the interest on any of the Bonds, the Registrar may, at the written direction of the Agency, mail notice to the registered owners of the Bonds of the availability of exchanging registered Bonds and coupon Bonds. Registered Bonds may then be exchanged for an equal aggregate pr incipal amount of coupon Bonds of the same Series and maturity of any authorized denomination and coupon Bonds may be exchanged for an equal aggregate principal amount in the manner provided in this Resolution. Unless otherwise specified by the Agency in subsequent pro- ceedings, the Bonds of a Series shall be dated as determined in a Chairman's Certificate as to the Series 1989 Bonds and by sub- sequent resolution of the Agency relating to the issuance of any other Series of Bonds; shall bear interest, which may be fixed or variable, from their date at a rate not exceeding the legal rate per annum, with interest mailed to the registered Holder thereof on each Interest Payment Date by the Paying Agent at the address shown on the registration books of the Agency (held by the Regis- trar) at the close of business on the 15th day of the calendar month preceding an Interest Payment Date (in each case a "Regular Record Date"), except for (i) Capital Appreciation Bonds which shall bear interest as described under the defined term Accreted Value, payable only upon redempt ion, acceleration or mat ur i ty thereof and (ii) Capital Appreciation and Income Bonds which shall bear interest as descr ibed under the def ined term Appre- ciated Value, payable on the amount due at maturity but only from and after the Interest Commencement Date; shall be let tered and shall be numbered in such manner as determined in a Chairman's Certificate as to the Series 1989 Bonds and by subsequent resolu- tion of the Agency relating to the issuance of any other Series of Bonds; shall be in the denominations determined in a Chair- man's Certificate as to the Series 1989 Bonds and by subsequent resolution of the Agency relating to the issuance of any other Ser ies of Bonds; and shall mature on such dates, in such years and in such amounts, as determined in a Chairman's Certificate as to the Series 1989 Bonds and as provided for by subsequent resolution of the Agency relating to any other Series of Bonds. Notwithstanding anything in this paragraph to the contrary, any interest not punctually paid on an Interest Payment Date shall - 12 - 11 forthwi th cease to be payable to the registered Holder on the Regular Record Date and may be paid to the registered Holder as of the close of business on a special record date for the payment of such defaulted interest to be fixed by the Paying Agent, notice of which shall be given not less than 10 days prior to such special record date to the registered Holders. The Bonds issued hereunder may be Serial Bonds or Term Bonds and may be Variable Rate Bonds, Capital Appreciation Bonds, Capital Appreciation and Income Bonds, Extendible Maturity Bonds, Balloon Bonds, Interim Bonds, Put Bonds and such other types of bonds as may be marketable from time to time, including, without limitation, taxable Bonds and Bonds issued in book entry form, as determined by subsequent proceedings of the Agency. SECTION 203. REDEMPTION PROVISIONS. The Bonds of each Series, other than the Series 1989 Bonds, may be subject to redemption prior to maturity at such times, at such redemption prices and upon such terms in addition to the terms contained in this Resolution as may be determined by subsequent resolutions of the Agency, which subsequent resolutions may contain redemption notice provisions. The redemption provisions and the redemption notice provisions for the Series 1989 Bonds shall be established in the manner described in the second paragraph of Section 201 of this Resolution. Unless otherwise provided by subsequent proceedings, in addition to any required redemption notice to Bondholders, the Agency shall give notice of redemption for Bonds being redeemed to registered securities depositories and to national information services that disseminate redemption notices at least 2 business days in advance of the notice mailed to holders of Bonds by send- ing notice to deposi tor ies such as Deposi tory Trust Company of New York, New York, Midwest Securities Trust Company of Chicago, Illinois, Pacific Securities Depository Trust Company of San Francisco, California, and Philadelphia Depository Trust Company of Phi ladelphia, Pennsylvania and to national information services such as Financial Information Inc.'s Daily Called Bond Service, Interactive Data Corporation's Bond Service, Kenny Information Service's Called Bond Service, Moody's Municipal and Government News Reports and Standard and Poor's Called Bond Record. In addition, the Paying Agent shall publish notice of redemption one time in The Bond Buyer of New York, New York or if the Paying Agent believes that such publication is impractical or unlikely to reach a substantial number of owners of the Bonds to be redeemed, in some other financial newspaper or journal which regularly carries notices of redemption of other obligations similar to the Bonds, such publication to be made at least 30 days prior to the date fixed for redemption. Notwithstanding the foregoing additional notice provisions, failure to mail or publish such additional notices or any defect therein shall not affect the validity of any redemption proceed- ings as to which notice of such redemption has been properly given to such Bondholder. SECTION 204. EXECUTION OF BONDS. The Bonds shall be exe- cuted in the name of the Agency by the Chairman, and the seal of the Agency or a facsimile thereof shall be affixed thereto or imprinted or reproduced thereon and attested by the Executive Director, either manually or with their facsimile signatures. In case anyone or more of the officers who shall have signed or sealed any of the Bonds shall cease to be such officer before the Bonds so signed and sealed shall have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as - 13 - 15 herein provided and may be issued as if the person who signed and sealed such Bonds had not ceased to hold such office. Any Bond may be signed and sealed on behalf of the Agency by such person as at the actual time of the execution of such Bond shall hold the proper office, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The Bonds of each Series shall bear thereon a certificate of authentication, in the form set forth in Exhibit B hereto, exe- cuted manually by the Registrar. Only such Bonds as shall bear thereon such certificate of authentication shall be entitled to any right or benefit under this Resolution and no Bond shall be valid or obligatory for any purpose until such certificate of authentication shall have been duly executed by the Registrar. Such certificate of the Registrar upon any Bond executed on behalf of the Agency shall be conclusive evidence that the Bond so authenticated has been duly authenticated and delivered under this Resolution and that the Holder thereof is enti tIed to the benefits of this Resolution. If the Bonds of a Series have been validated, the validation certificate on the back of each of the Bonds of such Series shall be signed with the facsimile signatures of the present or any future Chairman, and the Agency may adopt and use for that purpose the facsimile signature of any person who shall have been such Chairman at any time on or after the date of the Bonds, notwithstanding that he may have ceased to be such Chairman at the time when said Bonds shall be actually delivered. SECTION 205. NEGOTIABILITY, REGISTRATION AND CANCELLA- TION. At the option of the registered Holder thereof and upon surrender thereof at the principal corporate trust office of the Registrar with a written instrument of transfer satisfactory to the Registrar duly executed by the registered Holder or his duly authorized attorney and upon payment by such Holder of any charges which the Registrar or the Agency may make as provided in this Section, the Bonds may be exchanged for Bonds of the same aggregate principal amount of the same Series and maturity of any other authorized denominations. The Registrar shall keep books for the registration of Bonds and for the registration of transfers of Bonds. The Bonds shall be transferable by the Holder thereof in person or by his attor- ney duly authorized in writing only upon the books of the Agency kept by the Registrar and only upon surrender thereof together with a written instrument of transfer satisfactory to the Regis- trar duly executed by the Holder or his duly author ized attor- ney. Upon the transfer of any such Bond, the Agency shall cause to be issued in the name of the transferee a new Bond or Bonds. The Agency, the Trustee, the Paying Agent and the Registrar may deem and treat the person in whose name any Bond shall be registered upon the books kept by the Registrar as the absolute Holder of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of, premium, if any, and interest on such Bond as the same becomes due and for all other purposes. All such payments so made to any such Holder or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the Agency, the Trustee, the Paying Agent nor the Registrar shall be affected by any notice to the contrary. In all cases in which the privilege of exchanging Bonds or transferring Bonds is exercised, the Agency shall execute and the Registrar shall authenticate and deliver Bonds in accordance with the provisions of this Resolution. All Bonds surrendered in any - 14 - 16 such exchanges or transfers shall forthwith be delivered to the Registrar and cancelled by the Registrar in the manner provided in this Section. There shall be no charge for any such exchange or transfer of Bonds, but the Agency or the Registrar may require the payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid wi th respect to such exchange or transfer. Neither the Agency nor the Registrar shall be required (a) to transfer or exchange Bonds of any Series for a period of 15 days next preceding any selection of Bonds of such Series to be redeemed or thereafter until after the mailing of any notice of redemption; or (b) to transfer or exchange any Bonds of any Series called for redemption. Except as may otherwise be provided with respect to Put Bonds in the proceedings of the Agency providing for the issuance thereof, all Bonds paid or redeemed, either at or before maturity shall be delivered to the Trustee when such payment or redemption is made, and such Bonds, together with all Bonds purchased by the Agency, shall thereupon be promptly cancelled. Bonds so cancelled may at any time be destroyed by the Trustee, who shall execute a certification of destruction in duplicate by the signa- ture of one of its author i zed off icers descr ibing the Bonds so destroyed, and one executed certificate shall be filed with the Agency and the other executed certificate shall be retained by the Trustee. SECTION 206. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated, destroyed, stolen or lost, the Agency may execute and the Registrar shall authenticate and deliver a new Bond of like Series, date, maturity, denomina- tion and interest rate as the Bond so mutilated, destroyed, stolen or lost; provided that, in the case of any mutilated Bond, such mutilated Bond shall first be surrendered to the Agency and, in the case of any lost, stolen or destroyed Bond, there shall first be furnished to the Agency and the Registrar evidence of such loss, theft, or destruction satisfactory to the Agency and the Registrar, together with indemnity satisfactory to them. In the event any such Bond shall be about to mature or have matured or have been called for redemption, instead of issuing a dupli- cate Bond, the Agency may direct the Paying Agent to pay the same wi thout surrender thereof. The Agency and Registrar may charge the Holder of such Bonds their reasonable fees and expenses in connection with this transaction. Any Bond surrendered for replacement shall be cancelled in the same manner as provided in Section 205 hereof. Any such duplicate Bonds issued pursuant to this Section shall constitute additional contractual obligations on the part of the Agency, whether or not the lost, stolen or destroyed Bonds be at any time found by anyone, and such duplicate Bonds shall be entitled to equal and proportionate benefits and rights as to lien on and source and secur i ty for payment from the Pledged Funds, with all other Bonds issued hereunder. SECTION 207. PREPARATION OF DEFINITIVE BONDS; TEMPORARY BONDS. Unless otherwise specified by the Agency in subsequent proceedings, the definitive Bonds of each Series shall be litho- graphed, printed or typewritten. Until the definitive Bonds are prepared, the Chairman and Executive Director may execute and the Registrar may authenticate, in the same manner as is provided in Section 204, and deliver, in lieu of definitive Bonds, but subject to the same provisions, limitations and conditions as the definitive Bonds, one or more printed, lithographed or type- wr i tten temporary fully registered Bonds, substantially of the tenor of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued, in authorized denominations or any whole multiples thereof, and with such omissions, insertions and - 15 - If, variations as may be appropriate to such temporary Bonds. The Agency at its own expense shall prepare and execute and, upon the surrender at the corporate trust office of the Registrar of such temporary Bonds for which no payment or only partial payment has been provided, the Registrar shall authenticate and, without charge to the Holder thereof, deliver in exchange therefor, at the principal corporate trust office of the Registrar, definitive Bonds of the same aggregate principal amount, Series and maturity as the temporary Bonds surrendered. Until so exchanged, the temporary Bonds shall in all respects be enti tled to the same benefits and security as definitive Bonds issued pursuant to this Resolution. SECTION 208. FORM OF BONDS. The text of the Bonds shall be of the tenor set forth in Exhibit B to this Resolution, with such omissions, insertions and var iations as may be necessary and desirable and authorized or permitted by this Resolution or a Chairman's Certificate. [END OF ARTICLE II] - 16 - 18 ARTICLE III COVENANTS, FUNDS AND APPLICATION THEREOF SECTION 301. BONDS NOT TO BE INDEBTEDNESS OF THE AGENCY OR THE CITY. The Bonds shall not be and shall not consti tute an indebtedness of the Agency or the City, within the meaning of any consti tutional, statu tory or charter provisions or limi tat ions ; but shall be payable solely, as provided in this Resolution, from the Pledged Funds. No holder or holders of any Bonds issued hereunder shall ever have the right to compel the exercise of the ad valorem taxing power of the City, or taxation in any form of any real or personal property therein, or the application of any other funds of the Agency or the Ci ty to pay the Bonds or the interest thereon or the making of any sinking fund or reserve payments provided for herein. SECTION 302. BONDS SECURED BY PLEDGE OF PLEDGED FUNDS. The payment of the principal of, interest and premium, if any, on all of the Bonds issued hereunder and any addi tional par i ty Bonds hereafter issued, as provided herein, shall be secured forthwith equally and ratably by a first lien on and pledge of the Pledged Funds. The Trust Fund Revenues in an amount suff icient to pay the principal of and interest on the Bonds herein authorized and to make the payments into the Sinking Fund (hereinafter created and established) and all other payments provided for in this Resolution, as well as moneys held in the funds and accounts created under this resolution (other than the Rebate Fund), are hereby irrevocably pledged to the payment of the principal of and interest on the Bonds authorized herein, and other payments pro- vided for herein, as the same become due and payable. The Bonds and the obligation evidenced thereby shall not constitute a lien upon any property owned by or situated within the corporate territory of the Agency or the City, but shall constitute a lien only on the Pledged Funds all in the manner provided in this Resolution. SECTION 303. APPLICATION OF BOND PROCEEDS; ACQUISITION AND CONSTRUCTION FUND. (a) All moneys received by the Agency from the sale Ser ies 1989 Bonds issued pursuant to this Resolution, otherwise provided in the Chairman's Certificate shall be taneously disbursed as follows: of the unless simul- ( 1) Proceeds der i ved f rom the sale of the Ser ies 1989 Bonds equal to the accrued interest on the Series 1989 Bonds shall be deposi ted in the Interest Account, herein- after created and established, and used for the purpose of paying interest on the Series 1989 Bonds as the same becomes due and payable. ( 2) Proceeds der i ved f rom the sale of the Ser ies 1989 Bonds, together wi th other moneys lawfully available therefor, if any, shall be deposited in a Cost of Issuance Fund (hereinafter referred to as the "Cost of Issuance Fund") which is hereby created and established to be held by the Agency and used for the purpose of paying such costs of issuance of the Series 1989 Bonds as the Agency shall deter- mine are appropriate. (3) Proceeds der i ved from the sale of the Ser ies 1989 Bonds in an amount equal to the Reserve Account Requirement shall be deposited in the Debt Service Reserve Account, hereinafter created and established. - 17 - t~ (4) The balance of the proceeds der i ved from the sale of the Ser ies 1989 Bonds, together wi th other moneys lawfully available therefor, if any, shall be deposited in a subaccount designated "the Series 1989 Account" of a special fund hereby created, established and designated as the "Miami Beach Redevelopment Agency Acquisition and Construc- tion Fund" (hereinafter referred to as the "Acquisition and Construction Fund") to be held and administered by the Trustee. Such proceeds and other available moneys shall be applied by the Trustee as set forth in Section 303(c) below. (b) All moneys received by the Agency from the sale of any Series of Bonds, other than the Series 1989 Bonds, authorized and issued pursuant to this Resolution, unless otherwise provided by subsequent proceedings of the Agency authorizing such Series of Bonds, shall be simultaneously disbursed as follows: (1) The accrued interest, if any, derived from the sale of Bonds shall be deposited in the Interest Account and used for the purpose of paying interest on the Bonds as the same becomes due and payable. (2) Proceeds der i ved from the sale of Bonds, together wi th other moneys lawfully available therefor, if any, shall be deposi ted in the Cost of Issuance Fund and used for the purpose of paying such costs of issuance of such Bonds as the Agency shall determine are appropriate. (3) Proceeds of the sale of such Bonds, together with other moneys lawfully available therefor, if any, shall be deposited in the Debt Service Reserve Account in an amount sufficient to make the amount in the Debt Service Reserve Account equal to the Reserve Account Requirement on the Bonds outstanding under the Resolution; provided, however, that the Agency may elect to fund any increase in the Reserve Account Requirement as a result of the sale of the Bonds by the deposi t of a Reserve Account Insurance Policy or Reserve Account Letter of Credit as provided in Section 304(0) hereof. (4) The balance of the proceeds der i ved from the sale of such Bonds, other than Bonds issued to refund Out- standing Bonds, together with other moneys lawfully avail- able therefor, if any, shall be deposited in a subaccount of the Acquisition and Construction Fund designated with the Series of Bonds applicable thereto. Such proceeds and other available moneys shall be applied by the Trustee as set forth in Section 303(c) below. (5) The balance of the proceeds der i ved from the sale of such Bonds issued to refund Outstanding Bonds shall be applied to provide for the refunding of such Outstanding Bonds to be refunded in accordance with a resolution adopted by the Commission prior to the issuance of such Bonds. (c) Proceeds and other moneys on deposit in the Acquisi- tion and Construction Fund shall be disbursed by the Trustee in accordance wi th the provisions of this subsection (c). wi th- drawals may be made by the Agency from the Acquisition and Con- struction Fund upon receipt by the Trustee of a written requisi- tion executed by a duly authorized official of the Agency, speci- fying the purpose for which such wi thdrawal is to be made and certifying that such purpose is included within the scope of the project for which the applicable Series of Bonds was issued. In addition, (i) in the case of the Series 1989 Bonds, an authorized official of the Agency shall deliver to the Trustee wi th each such requisition a certificate in the form of Exhibit C, attached - 18 - 20 hereto and made a part hereof and (ii) in the case of any other Series of Bonds, an authorized official of the Agency shall deli ver to the Trustee wi th each such requisi tion such other certificates as may be provided for in a resolution of the Agency author izing such Ser ies of Bonds. If for any reason the moneys in the Acquisition and Construction Fund, or any part thereof including any investment earnings on deposi t therein, are not necessary for, or are not applied to the purposes provided for the applicable Ser ies of Bonds, then such unapplied proceeds, upon certification of a duly authorized official of the Agency that such surplus proceeds are not needed for such purposes, shall be applied to the redemption or purchase or payment of principal of Outstanding Bonds. Moneys on deposit in the Acquisition and Construction Fund may be invested and reinvested to the fullest extent practicable in Permitted Investments maturing not later than such date or dates on which such moneys shall be needed for the purposes of the Acquisition and Construction Fund. The earnings and invest- ment income derived from the moneys and investments on deposit in the Acquisi tion and Construction Fund shall be deposi ted and maintained in the Acquisition and Construction Fund and used for the purposes thereof. (d) The proceeds of the sale of constitute trust funds for the purposes there is hereby created a lien upon applied, in favor of the holders of said the Bonds shall be hereinabove provided such moneys, until Bonds. and and so SECTION 304. COVENANTS OF THE AGENCY. The Agency hereby covenants and agrees with the holders of any and all of the Bonds issued pursuant to this Resolution as follows: A. TAX COVENANTS. (1) The Agency will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would result in the failure to exclude interest on the Bonds from gross income for Federal income tax purposes under Section l03(a) of the Code. Particularly, the Agency will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of the initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code. (2) The Agency rebate covenants as provided shall comply with the in Section 304(E) hereof. arbitrage B. REDEVELOPMENT PLAN. The Agency will carry out the purposes of the Redevelopment Plan within the Redevelopment Area all in accordance with the Act and will take all such actions as are required to carry out the full intent of the Redevelopment Plan. C. TRUST FUND. As soon as the same are received by the Agency, all of the Trust Fund Revenues shall be forthwith deposited into the Trust Fund. The Trust Fund shall constitute a trust fund for the purposes provided in this Resolution, shall be held by the Agency and shall be maintained separate and distinct from all other funds of the Agency and used only for the purposes and in the manner provided in this Resolution and the Act. D. DISPOSITION OF TRUST FUND REVENUES. There is hereby created and established as a sub-fund of the Trust Fund the "Miami Beach Redevelopment Agency Sinking Fund" (hereinafter referred to as the "Sinking Fundl!). There are also hereby cre- - 19 - ~~_J ated four (4) separate accounts in the Sinking Fund to be known as the "Interest Account," the "Principal Account," the "Bond Redemption Account" and the "Debt Service Reserve Account." The Sinking Fund and the accounts therein shall be held and admin- istered by the Trustee. All Trust Fund Revenues received by the Agency from the City and the County on deposit in the Trust Fund shall be disposed of by the Agency only in the following manner: (1) Trust Fund Revenues shall first be used, to the full extent necessary, for deposit with the Trustee into the Interest Account in the Sinking Fund, immediately upon receipt of such Trust Fund Revenues, of such sums as shall be sufficient to pay the interest becoming due on the Bonds during such calendar year; provided, however, that such deposit for interest shall not be required to be made into the Interest Account to the extent that money on deposi t therein is sufficient for such purpose and, provided fur- ther, that in the event the Agency has issued addi tional par i ty Var iable Rate Bonds pursuant to the provisions of this Resolution, Trust Fund Revenues shall be deposited at such other or additional times and amounts as necessary to pay the interest becoming due on the Var iable Rate Bonds during such calendar year, all in the manner provided in the supplemental resolution author izing such additional par i ty Variable Rate Bonds or in a resolution determining the details of Variable Rate Bonds that have been authorized but unissued. The Trustee shall, on each Interest Payment Date, transfer to the Paying Agent moneys in an amount equal to the interest due on such Interest Payment Date or shall advise the Paying Agent of the amount of any deficiency in the amount so transferred so that the Paying Agent may give appropriate notice required to provide for the payment of such deficiency from any Reserve Account Insurance Policy or Reserve Account Let ter of Credi t on deposi t in the Debt Service Reserve Account. (2) (a) Trust Fund Revenues shall next be used, to the full extent necessary, for deposit with the Trustee into the Principal Account in the Sinking Fund, immediately upon receipt of such Trust Fund Revenues, of such sums as shall be sufficient to pay the principal amount of Serial Bonds which will mature during such calendar year; provided, however, that such deposit for principal shall not be required to be made into the Principal Account to the extent that money on deposit therein is sufficient for such purpose. The Trustee shall, on the business day prior to each principal payment date, transfer to the Paying Agent moneys in an amount equal to the pr incipal due on such pr incipal payment date or shall advise the Paying Agent of the amount of any deficiency in the amount so transferred so that the Paying Agent may give appropriate notice required to provide for the payment of such deficiency from any Reserve Account Insurance Policy or Reserve Account Letter of Credi t on deposit in the Debt Service Reserve Account. (b) Trust Fund Revenues shall next be used, to the full extent necessary, for deposit with the Trustee into the Bond Redemption Account in the Sinking Fund, immediately upon receipt of such Trust Fund Revenues, of such Amortiza- tion Requirements as may be required for the payment of the - 20 - ,.)".~ A..-tt.., Term Bonds payable from the Bond Redemption Account during such calendar year. The moneys in the Bond Redemption Account shall be used solely for the purchase or redemption of the Term Bonds payable therefrom. The Agency may at any time purchase any of said Term Bonds at prices not greater than the then redemption pr ice of said Term Bonds. If the Term Bonds are not then redeemable, the Agency may purchase said Term Bonds at prices not greater than the redemption price of such Term Bonds on the next ensuing redemption date. The Agency shall be mandatorily obligated to use any moneys in the Bond Redemption Account for the redemption prior to maturity of such Term Bonds at such times as the same are subject to mandatory redemption. If, by the application of moneys in the Bond Redemption Account, however, the Agency shall purchase or call for redemption in any year Term Bonds in excess of the Amortization Requirements for such year, such excess of Term Bonds so purchased or redeemed shall be credited in such manner and at such times as the Executive Director shall determine over the remaining payment dates. No distinction or preference shall exist in the use of the moneys on deposit in the Trust Fund for payment into the Interest Account, the Pr incipal Account and the Bond Redemption Account, such accounts being on a parity with each other as to payment from the Trust Fund. (3) Trust Fund Revenues shall next be used, to the full extent necessary, for deposit with the Trustee into the Debt Service Reserve Account, immediately upon receipt of such Trust Fund Revenues, of the difference between the amount on deposit in the Debt Service Reserve Account (including any Reserve Account Insurance Policy or Reserve Account Letter of Credit) and the Reserve Account Require- ment for the Bonds Outstanding, and, provided, further, that no payments shall be required to be made into the Debt Service Reserve Account whenever and as long as the amount deposited therein (including any Reserve Account Insurance Policy or Reserve Account Letter of Credit) shall be equal to the Reserve Account Requirement for the Bonds Outstand- ing. Notwi thstanding the foregoing provisions, in lieu of or in substitute for the required deposits of Trust Fund Revenues (including existing deposi ts of Trust Fund Revenues) into the Debt Service Reserve Account, the Agency may cause to be deposi ted into the Debt Service Reserve Account a Reserve Account Insurance Policy or a Reserve Account Letter of Credit for the benefit of the holders of the Bonds Outstanding in an amount equal to the difference between the Reserve Account Requirement for the Bonds Out- standing and the sums then on deposi t in the Debt Service Reserve Account, if any, which Reserve Account Insurance Policy or Reserve Account Letter of Credit shall be payable or available to be drawn upon, as the case may be, (upon the giving of notice as required thereunder) on any Interest Payment Date on which a def iciency exists which cannot be cured by moneys in any other fund or account held pursuant to this Resolution and available for such purpose. If a disbursement is made under the Reserve Account Insurance Policy or the Reserve Account Letter of Credit, the Agency shall be obligated to either reinstate the maximum limits of such Reserve Account Insurance Policy or Reserve Account Letter of Credit immediately following such disbursement or to deposi t into the Debt Service Reserve Account from the Trust Fund Revenues, as herein provided, funds in the amount - 21 - 23 of the disbursements made under such Reserve Account Insur- ance Policy or Reserve Account Letter of Credit, or a combination of such alternatives as shall equal the Reserve Account Requirement for the Bonds Outstanding. Moneys in Debt Service Reserve Account shall be used only for the purpose of making payments of principal of and interest on the Bonds when the moneys in the Trust Fund or any other fund or account held pursuant to this Resolution and available for such purpose are insufficient therefor. Any moneys in the Debt Service Reserve Account in excess of the Reserve Account Requi rement for the Bonds Outstanding may, in the discretion of the Agency, be trans- ferred to and deposited in the Interest Account, the Prin- cipal Account or the Bond Redemption Account as the Agency at its option may determine. The Debt Service Reserve Account shall be valued at least once in each Fiscal Year and the value of securities on deposi t therein shall be the lower of par, or if pur- chased at other than par, amortized value. Amortized value, when used with respect to securities purchased at a premium above or a discount below par, shall mean the value at any given date obtained by dividing the total premium or dis- count at which such securities were purchased by the number of interest payment dates remaining to matur i ty on such securities after such purchase and by multiplying the amount so calculated by the number of interest payment dates having passed since the date of purchase; and (i) in the case of securities purchased at a premium, by deducting the product thus obtained from the purchase price, and (ii) in the case of securities purchased at a discount, by adding the product thus obtained to the purchase price. (4) Trust Fund Revenues shall next be used for the payment of any subordinated obligations hereafter issued by the Agency in accordance with Section 304(G) of this Resolu- tion, which subordinate obligations shall have such lien on the Trust Fund Revenues as the Agency shall determine in the proceedings author izing the issuance of such subordinated obligations. (5) Thereafter, the balance of any Trust Fund Revenues remaining in said Trust Fund shall, subject to Section 304(A), be used by the Agency for any lawful purposes; provided, however, that none of such Trust Fund Revenues shall ever be used for the purposes provided in this paragraph (5) unless all payments requi red in para- graphs (1) through (4) above, including any deficiencies for prior payments and any amounts due to the issuer of any Reserve Account Insurance Policy or Reserve Account Letter of Credit, have been made in full to the date of such use. Notwithstanding anything in Section 304(D)(1) & (2) to the contrary failure to make the scheduled payments specified therein shall not constitute a breach of the Agency's obligations under this Resolution so long as, on the date that any interest or principal payment is due on the Bonds, monies sufficient to make such payment are on deposit in the Interest Account, principal Account or the Bond Redemption Account, as the case may be. Notwithstanding the foregoing or any other provision herein to the contrary, if any amount applied to the payment of princi- pal of and premium, if any, and interest on the Bonds that would have been paid from an account in the Sinking Fund, is paid instead under a Credit Facility or a Liquidity Facility, amounts - 22 - z.j deposi ted in such relevant account may be paid, to the extent required, to the issuer of the Credit Facility or Liquidity Facility having therefore made said corresponding payment. E. REBATE FUND. There is hereby created and established the "Rebate Fund" which fund shall be maintained with the Trustee separate and apart from all other funds and accounts of the Trustee or the Agency. Notwithstanding anything in this Resolu- tion to the contrary, the Agency shall transfer or cause to be transferred the amounts required to be transferred in order to comply with the arbitrage rebate covenants contained in a certi- ficate to be executed and delivered by the Agency in connection wi th the issuance of each Ser ies of Bonds. The Agency shall cause the Trustee to make payments from the Rebate Fund of amounts required to be deposited therein to the United States of America in the amounts and at the times required by such arbi- trage rebate covenants. The Agency covenants for the benefit of the Bondholders that it will comply with the requirements of the arbi trage rebate covenants. There shall be excluded from the pledge and lien of this Resolution the Rebate Fund, together with all moneys and securities from time to time held therein and all investment earnings derived therefrom. The Agency shall not be required to comply with the requirements of this Section 304(E) in the event that the Agency obtains an opinion of nationally recognized bond counsel that (i) such compliance is not required in order to maintain the exclusion from gross income for Federal income tax purposes of interest on the Bonds and/or (ii) com- pliance with some other requirement is necessary to maintain the exclusion from gross income for Federal income tax purposes of interest on the Bonds. F. INVESTMENT OF FUNDS. The Trust Fund, the Sinking Fund, including the Interest Account, Pr incipal Account, Bond Redemption Account and Debt Service Reserve Account and the Cost of Issuance Fund and all other special funds (other than the Rebate Fund) created and established by this Resolution shall constitute trust funds in favor of the Bondholders and shall be invested at the direction of the Agency as provided in this Section 304(F). Moneys on deposit in the Trust Fund, Interest Account, Prin- cipal Account, Bond Redemption Account and Cost of Issuance Fund may be invested in Permitted Investments maturing not later than the dates on which such moneys will be needed for the purposes of such fund or account. Moneys on deposit in the Debt Service Reserve Account may be invested in permi t ted Investments matur ing not later than the final maturity of any of the Bonds. All income and earnings received from the investment and reinvestment of moneys in the Interest Account, the pr incipal Account and the Bond Redemption Account in the Sinking Fund shall be retained in the respective accounts and applied as a credi t against the obligation of the Agency to transfer moneys from the Trust Fund to such accounts pursuant to Section 304 (D) (1) and Section 304(D)(2)(a) and Section 304(D)(2)(b) of this Resolution, respectively. All income and earnings received from the investment and reinvestment of moneys in the Debt Service Reserve Account in the Sinking Fund shall be retained in the Debt Service Reserve Account and applied as a credit against the obligation of the Agency to transfer moneys from the Trust Fund to such account, unless the amount in such account shall exceed the Reserve Account Requirement, in which event such excess may be applied in the manner set forth for excess amounts in the Debt Service Reserve Account, as described in Section 304(D)(3). - 23 - ...,.- 1(,;:') All income and earnings received from the reinvestment of moneys in the Cost of Issuance transferred to the Trust Fund. investment and Fund shall be For the purpose of investing or reinvesting, the Agency and the Trustee may commingle moneys in the funds and accounts created and established hereunder (other than the Rebate Fund) in order to achieve greater investment income; provided that the Agency and the Trustee shall separately account for the amounts so commingled. The amounts required to be accounted for in each of the funds and accounts designated herein (other than the Rebate Fund) may be deposited in a single bank account provided that adequate accounting procedures are maintained to reflect and control the restr icted allocations of the amounts on deposi t therein for the var ious purposes of such funds and accounts as herein provided. G. ISSUANCE OF OTHER OBLIGATIONS PAYABLE OUT OF TRUST FUNDS. Except upon the condi tions and in the manner provided herein, the Agency will not issue any other obligations payable from the Pledged Funds, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or any other charge having pr ior i ty to or being on a par i ty wi th the lien of the Bonds issued pursuant to this Resolution and the interest thereon, upon any of the Pledged Funds; provided that the Agency may enter into agreements with issuers of Credit Facilities and Liquidity Facilities which involve liens on Trust Fund Revenues on a par i ty wi th that of the Ser ies of Bonds or portion thereof which is supported by such Credit Facilities or Liquidity Facilities. Any other obligations, in addition to the Bonds author ized by this Resolution or additional par i ty Bonds issued under the terms, restrictions and conditions contained in this Resolution, shall provide that such obligations are junior, infer ior and subordinate in all respects to the Bonds issued pursuant to this Resolution as to lien on and source and security for payment from the Trust Fund Revenues and in all other respects. Nothing in this Resolution shall be deemed to prohibit the Agency from entering into currency swaps or other arrange- ments for pledging interest rates on any indebtedness. H. ISSUANCE OF ADDITIONAL PARITY BONDS. No additional parity Bonds, as in this subsection defined, payable on a parity wi th Bonds issued pursuant to this Resolution out of Pledged Funds shall be issued after the issuance of any Bonds pursuant to this Resolution unless the following, among other conditions, are complied with: (1) The Agency must be current in all deposits into the various funds and accounts and all payments theretofore requi red to have been deposi ted or made by it under the provisions of this Resolution and the Agency must be currently in compliance with the covenants and provisions of this Resolution and any supplemental resolution hereafter adopted for the issuance of additional parity Bonds; unless upon the issuance of such additional parity Bonds the Agency will be in compliance with all such covenants and provi- sions. (2) The amount of the Trust Fund Revenues during the immediately preceding Fiscal Year or any twelve (12) conse- cutive months selected by the Agency of the eighteen (18) months immediately preceding the issuance of said additional parity Bonds, as certified by an independent certified public accountant, were at least equal to one hundred twenty five percent (125%) of the Maximum Annual Debt Service on (1) the Bonds originally issued pursuant to this Resolution and then Outstanding, (2) any additional parity Bonds there- - 24 - ~? t; tofore issued and then Outstanding, and (3) the additional parity Bonds then proposed to be issued. (3) The Agency need not comply with subparagraph (2) of this paragraph in the issuance of additional parity Bonds if and to the extent the Bonds to be issued are refunding Bonds, that is, delivered in lieu of or in substitution for Bonds originally issued under this Resolution or previously issued additional parity Bonds, if the Agency shall cause to be delivered a certificate of the Executive Director of the Agency setting forth (i) the Maximum Annual Debt Service (A) with respect to the Bonds of all Series Outstanding immedi- ately prior to the date of authentication and delivery of such refunding Bonds, and (B) with respect to the Bonds of all Ser ies to be Outstanding immediately thereafter, and (ii) that the Maximum Annual Debt Service set forth pursuant to (B) above is no greater than that set forth pursuant to (A) above. Simultaneously with the delivery of any Bonds issued pursuant to Sections (2) and (3) above for the purpose of refunding any Bonds issued under this Resolution, the Agency may withdraw from the Sinking Fund amounts theretofore deposi ted which are allocable to the Bonds being refunded and shall transfer said amounts in accordance with the reso- lution providing for the issuance of the refunding Bonds, provided that after such withdrawal the Agency shall be in compliance with the provisions of this Resolution. The term "additional parity Bonds" as used in this Resolution shall be deemed to mean additional obligations evidenced by Bonds issued upon the provisions and within the limitations of this subsection to finance Redevelopment Projects payable from the Pledged Funds on a par i ty wi th Bonds originally authorized and issued pursuant to this Resolution. Such Bonds shall be deemed to have been issued pursuant to this Resolution the same as the Bonds originally authorized and issued pursuant to this Resolution and all of the covenants and other provisions of this Resolution (except as to details of such Bonds evidencing such addi- tional parity obligations inconsistent therewith), shall be for the equal benefit, protection and security of the holders of any Bonds originally authorized and issued pur- suant to this Resolution and the holders of any Bonds evidencing additional obligations subsequently issued within the limitations of and in compliance with this subsection. All of such Bonds, regardless of the time or times of their issuance shall rank equally wi th respect to their lien on the Pledged Funds and their sources and security for payment therefrom without preference of any Bonds over any other. The term "addi tional par i ty Bonds" as used in this Resolution shall not be deemed to include bonds, notes, certificates or other obligations subsequently issued in accordance with this Resolution, the lien of which on the Pledged Funds is subject to the prior and superior lien on the Pledged Funds of Bonds and the Agency shall not issue any obligations whatsoever payable from the Pledged Funds, which rank equally as to lien and source and secur i ty for their payment from such Pledged Funds, with Bonds except in the manner and under the conditions provided in subsection (G) above and this subsection. I. BOOKS AND RECORDS. The Agency will keep separately identifiable accounting records for the receipt of the Pledged Funds by the use of a fund established in accordance with gener- ally accepted accounting principles, and any holder of a Bond or - 25 - 2~7 Bonds issued pursuant to this Resolution, shall have the right at all reasonable times to inspect all records, accounts and data of the Agency relating thereto. The Agency shall promptly after the close of each Fiscal Year cause the books, records and accounts relating to the Pledged Funds for such Fiscal Year to be properly audi ted by a qualified, recognized and nationally known independent firm of certified public accountants and shall file the report of such certified public accountants in the office of the Executive Director, and shall mail upon request, and make available gener- ally, said report, or a reasonable summary thereof, to any holder or holders of Bonds issued pursuant to this Resolution. Such audited books, records and accounts shall contain the statements required by generally accepted accounting principles applicable to governmental entities, and a certificate of such certified public accountants disclosing any breach on the part of the Agency of any covenant herein. J. NO IMPAIRMENT OF CONTRACT. The Agency has full power and author i ty to irrevocably pledge the Pledged Funds to the payment of the pr incipal of and interest on the Bonds. The pledge of such Pledged Funds, in the manner provided herein, shall not be subject to repeal, modification or impairment by any subsequent resolution, ordinance or other proceedings of the Agency so long as any Bonds are Outstanding hereunder. The Agency shall take all actions necessary and pursue such legal remedies which may be available to it either in law or in equity to prevent or cure any impairment by any entity other than the Agency within the meaning of this subsection. K. REMEDIES. Any holder of Bonds issued under the provi- sions of this Resolution or the Trustee acting for such Bond- holders, may either at law or in equity, by suit, action, man- damus or other proceedings in any court of competent jurisdic- tion, protect and enforce any and all rights under the laws of the State, or granted and contained in this Resolution, and may enforce and compel the performance of all duties required by this Resolution or by any applicable statutes, including the Act, to be performed by the Agency or by any officer thereof. Nothing herein, however, shall be construed to grant any Holder of such Bonds any lien on any property of the Agency, except as provided herein. No Holder of Bonds, however, shall have any right in any manner whatever to affect adversely, or prejudice the security of this Resolution or to express any right hereunder except in the manner herein provided, and all proceedings at law or in equity shall be instituted and maintained for the benefit of all Holders of Bonds. The Holder or Holders of Bonds in an aggregate principal amount of more than twenty per centum (20%) of Bonds issued under this Resolution then Outstanding may by a duly executed certi- ficate in wr i ting request the Trustee to represent such Bond- holders in any legal proceedings for the enforcement and protec- tion of the rights of such Bondholders. Such certificate shall be executed by such Bondholders or their duly authorized attor- neys or representatives, and shall be filed in the office of the Executive Director. L. ENFORCEMENT OF COLLECTIONS. The Agency will dili- gently enforce and collect the Trust Fund Revenues and will take all steps, actions and proceedings for the enforcement and col- lection of such Trust Fund Revenues to the full extent permitted or author ized by appl icable laws, including the Act. All such Trust Fund Revenues shall, as collected, be held in trust to be applied as herein provided and not otherwise. - 26 - ~~R M. DISCHARGE AND SATISFACTION OF BONDS. The covenants, liens and pledges entered into, created or imposed pursuant to this Resolution may be fully discharged and satisfied with respect to all or a portion of the Bonds in anyone or more of the following ways: (1) by paying the principal of and interest on such Bonds when the same shall become due and payable; or (2) by depositing in the Interest Account, the Prin- cipal Account and the Bond Redemption Account and/or in such other accounts which are irrevocably pledged to the payment of Bonds as the Agency may hereafter create and establish by resolution, certain moneys which together with other moneys lawfully available therefor, if any, shall be sufficient at the time of such deposi t to pay when due the pr incipal, redemption premium, if any, and interest due and to become due on said Bonds on or pr ior to the redempt ion date or maturity date thereof; or (3) by depositing in the Interest Account, the Prin- cipal Account and the Bond Redemption Account and/or such other accounts which are irrevocably pledged to the payment of Bonds as the Agency may hereafter create and establish by resolution, moneys which together with other moneys lawfully available therefor when invested in such Defeasance Obliga- tions which shall not be subject to redemption pr ior to their maturity other than at the option of the holder there- of, will provide moneys which shall be sufficient to pay when due the pr incipal, redemption premium, if any, and interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof. Upon such payment or deposit in the amount and manner provided in this Section 304(M), Bonds shall be deemed to be paid and shall no longer be deemed to be Outstanding for the purposes of this Resolution and all liability of the Agency wi th respect to said Bonds shall cease, terminate and be completely discharged and extinguished, and the Holders thereof shall be enti tled for payment solely out of the moneys or securities so deposited; provided that in the event said Bonds do not mature and are not to be redeemed within the next succeeding sixty (60) days, the Agency shall have given the Registrar irrevocable instructions to give, as soon as practicable, a notice to the Holders of said Bonds by first-class mail, postage prepaid, stating that the deposi t of said moneys or Defeasance Obligations has been made with an appropriate fiduciary institution acting as escrow agent solely for the Holders of said Bond and other Bonds being defeased, and that said Bonds are deemed to have been paid in accordance with this Section and stating such ma tur i ty or redemption date upon which moneys are to be available for the payment of the principal of and premium, if any, and interest on said Bonds. (4) As to Var iable Rate Bonds, whether discharged and satisfied under the provisions of subsection (l), (2) or (3) above, the amount required for the interest thereon shall be calculated at the maximum rate permitted by the terms of the provisions which author ized the issuance of such Variable Rate Bonds; provided however, that if on any date, as a result of such Variable Rate Bonds having borne interest at less than such maximum rate for any period, the total amount of moneys and Defeasance Obligations on deposit for the payment of interest on such Variable Rate Bonds is in excess of the total amount which would have been required to be deposi ted on such date in respect of such Var iable - 27 - 29 Rate Bonds in order to fully discharge and satisfy such Bonds pursuant to the provisions of this Section, the Agency may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment secur- ing said Var iable Rate Bonds or otherwise existing under this Resolution. (5) Notwi thstanding any of the provisions of this Resolution to the contrary, Put Bonds and Extendible Matur i ty Bonds may only be fully discharged and satisf ied either pursuant to subsection (1) above or by depositing in the Interest Account, the Pr incipal Account and the Bond Redemption Account, or in such other accounts which are irrevocably pledged to the payment of the Put Bonds as the Agency may hereafter create and establish by resolution, moneys which together with moneys lawfully available there- for, if any, shall be sufficient at the time of such deposit to pay when due the maximum amount of principal of and redemption premium, if any, and interest on such Put Bonds and Extendible Maturity Bonds which could become payable to the Holders of such Bonds upon the exercise of any options provided to the Holders of such Bonds; provided however, that if, at the time a deposi t is made pursuant to this subsection (5), the options or iginally exercisable by the Holder of a Put Bond are no longer exercisable, such Bond shall not be considered a Put Bond and Extendible Maturity Bond for purposes of this subsection (5). (6) Notwithstanding the foregoing, all references to the discharge and satisfaction of Bonds shall include the discharge and satisfaction of any issue of Bonds, any por- tion of an issue of Bonds, any maturity or maturities of an issue of Bonds, any portion of a matur i ty of an issue of Bonds or any combination thereof, provided that the provi- sions of this subsection (6) shall not affect the require- ments regarding Put Bonds and Extendible Maturity Bonds set forth in subsection (5). In the event that the principal and redemption price, if applicable, and interest due on the Bonds shall be paid by the issuer of a Credit Facility or Liquidity Facility pursuant to the terms thereof, the assignment and pledge created hereunder and all covenants, agreements and other obligations of the Agency to the Bondholders shall continue to exist and the issuer of such Credit Facility or Liquidity Facility shall be subrogated to the rights of such Bondholders. (7) If any portion of the moneys deposi ted for the payment of the principal of and redemption premium, if any, and interest on any portion of Bonds is not required for such purpose, the Agency may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under this Resolution. N. CONCERNING THE RESERVE ACCOUNT INSURANCE POLICY, THE RESERVE ACCOUNT LETTER OF CREDIT, CREDIT FACILITY AND/OR LIQUID- ITY FACILITY. As long as the Agency shall have a Reserve Account Insurance Policy and/or a Reserve Account Letter of Credi t on deposit in the Debt Service Reserve Account, the Agency covenants that it will comply wi th the provisions of the Reserve Account Insurance Policy and/or the reimbursement or similar agreement with respect to the Reserve Account Letter of Credit. As long as any Series of Bonds of the Agency are secured by a Credit Facility or Liquidity Facility, the Agency covenants to - 28 - 30 comply with the requirements and conditions imposed on the Agency by the issuer of the Credit Facility or Liquidity Facility. Notwithstanding anything in this Resolution to the contrary, the rights of any issuer of a Credit Facility or Liquidity Facility created under this Resolution shall remain in full force and effect only so long as the applicable Credit Facility or Liquidity Facility shall remain in effect and the issuer of such Credit Facility or Liquidity Facility shall not be in default in its payment obligations to the holders of Bonds secured by such facility. [END OF ARTICLE III] - 29 - 31 ARTICLE IV CONCERNING THE FIDUCIARIES SECTION 401. ADDITIONAL PAYING AGENTS; APPOINTMENT AND ACCEPTANCE OF DUTIES. The Agency may at any time or from time to time appoint one or more other Paying Agents having the quali- fications set forth in this Article IV for a successor Paying Agent; provided that nothing herein shall prevent the Agency from appointing itself as the Paying Agent hereunder. Each Paying Agent shall signify its acceptance of the duties and obligations imposed upon it by this Resolution by executing and delivering to the Agency a written acceptance thereof. SECTION 402. RESPONSIBILITIES OF FIDUCIARIES. The recitals of facts herein and in the Bonds contained shall be taken as the statements of the Agency and no Fiduciary assumes any responsi- bility for the correctness of the same. No Fiduciary makes any representation as to the validity or sufficiency of this Resolu- tion or of any Bonds issued thereunder or as to the secur i ty afforded by this Resolution, and no Fiduciary shall incur any 1 iabi 1 i ty in respect thereof. The Reg istrar shall, however, be responsible for its representation contained in its certificate of authentication of the Bonds. No Fiduciary shall be under any responsibili ty or duty wi th respect to the application of any moneys paid by such Fiduciary in accordance with the provisions of this Resolution to or upon the order of the Agency or any other Fiduciary. No Fiduciary shall be under any obligation or duty to perform any act which would involve it in expense or liability or to institute or defend any suit in respect thereof, or to advance any of its own moneys, unless proper ly indemni- fied. No Fiduciary shall be liable in connection with the performance of its duties hereunder except for its own negli- gence, misconduct or default. SECTION 403. EVIDENCE ON WHICH FIDUCIARIES MAY ACT. (a) Each Fiduciary, upon receipt of any notice, resolu- tion, request, consent, order, certificate, report, opinion, bond, or other paper or document furnished to it pursuant to any provision of this Resolution, shall examine such instrument to determine whether it conforms to the requirements of this Resolu- tion and shall be protected in acting upon any such instrument believed by it to be genuine and to have been signed or presented by the proper party or parties. Each Fiduciary may reasonably consul t wi th counsel, who mayor may not be of counsel to the Agency, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it under this Resolution in good faith and in accordance therewith. (b) Whenever any Fiduciary shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action under this Resolution, such matter (unless other evidence in respect thereof be therein specifically prescr ibed) may be deemed to be conclusively proved and estab- lished by a certificate of the Chairman, Executive Director or his designee, and such certificate shall be full warrant for any action taken or suffered in good faith under the provisions of this Resolution upon the faith thereof; but in its discretion the Fiduciary may in lieu thereof accept other evidence of such fact or matter or may require such further or additional evidence as it may deem reasonable. (c) Except as otherwise expressly provided in this Resolu- tion, any request, order, notice or other direction required or permi t ted to be furnished pursuant to any provision thereof by the Agency to any Fiduciary shall be sufficiently executed in the name of the Agency by the Chairman, Executive Director or designee of either of them. - 30 - "}? "If,.. SECTION 404. COMPENSATION. The Agency may agree with any Fiduciary to pay to such Fiduciary from time to time reasonable compensation for all services rendered under this Resolution, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of its attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Resolution. The Agency may also agree with any Fiduciary to indemnify any Fiduciary for any and all of its reasonable fees, costs and expenses resul ting from any claim, liability or the like incurred in and about the performance of its powers and duties under this Resolution. SECTION 405. CERTAIN PERMITTED ACTS. Any Fiduciary, indi- vidually or otherwise, may become the owner of any Bonds, with the same rights it would have if it were not a Fiduciary. To the extent permitted by law, any Fiduciary may act as depositary for, and permit any of its officers or directors to act as a member of, or in any other capacity with respect to, any committee formed to protect the rights of Bondholders or to effect or aid in any reorganization growing out of the enforcement of the Bonds or this Resolution, whether or not any such committee shall rep- resent the Holders of a majority in principal amount of the Bonds then Outstanding. SECTION 406. MERGER OR CONSOLIDATION. Any enti ty into which any Fiduciary may be merged or converted or with which it may be consolidated or any entity resulting from any merger, conversion or consolidation to which it shall be a party or any entity to which any Fiduciary may sell or transfer all or sub- stantially all of its corporate trust business, provided such entity shall be a bank or trust company organized under the laws of any state of the United States or a national banking associa- tion or shall be a successor entity to the Agency, if the Agency is acting as Fiduciary hereunder; and shall be authorized by law to perform all duties imposed upon it by this Resolution, shall be the successor to such Fiduciary without the execution or filing of any paper or the performance of any further act. SECTION 407. ADOPTION OF AUTHENTICATION. In case any of the Bonds contemplated to be issued under this Resolution shall have been authenticated but not delivered, any successor Regis- trar may adopt the certificate of authentication of any predeces- sor Registrar so authenticating such Bonds and deliver such Bonds so authenticated; and in case any of the said Bonds shall not have been authenticated, any successor Registrar may authenticate such Bonds in the name of the predecessor Registrar, or in the name of the successor Registrar, and in all such cases such cer- tificate shall be fully effective. SECTION 408. RESIGNATION OR REMOVAL OF FIDUCIARY AND APPOINTMENT OF SUCCESSOR. Any Fiduciary may at any time resign and be discharged of the duties and obligations created by this Resolution by giving at least 60 days' written notice to the issuer of a Credit Facility or Liquidity Facility, the Agency, and the other Fiduciaries. Any Fiduciary may be removed at any time by an instrument filed with such Fiduciary and the issuer of each Credi t Facili ty or Liquidi ty Facili ty and signed by the Chairman, Executive Director or his designee. Any successor Fiduciary shall be appointed by the Agency and shall be, if other than the Agency or its successor entity, a bank or trust company organized under the laws of any state of the United States or a national banking association, willing and able to accept the office on reasonable and customary terms and authorized by law to perform all the duties imposed upon it by this Resolution. The Agency shall notify the issuer of each Credit Facility or Liquidi ty Facili ty of the appointment of any successor Fidu- ciary. In the event of the resignation or removal of any Fiduciary, such Fiduciary shall pay over, assign and deliver any moneys held by it as Fiduciary to its successor. - 31 - 33 SECTION 409. VACANCY. If at any time hereafter any Fidu- ciary shall resign, be removed, be dissolved, or otherwise become incapable of acting, or if the bank or trust company acting as any Fiduciary shall be taken over by any governmental official, agency, department or board, the posi tion of Fiduciary shall thereupon become vacant. If the position of such Fiduciary shall become vacant for any of the foregoing reasons or for any other reasons, the Agency shall appoint a successor Fiduciary and shall publish notice of any such appointment by it made once in each week for two (2) successive weeks in a daily newspaper of general circulation or a financial journal published in the Borough of Manhattan, City and State of New York. At any time wi thin one year after any such vacancy shall have occurred, the Holders of a majority in aggregate principal amount of the Bonds hereby secured and then Outstanding, by an instrument or concurrent instruments in writing, executed by such Bondholders or their attorneys in fact or legal representatives and filed with the Agency, may appoint a successor Fiduciary which shall supersede such Fiduciary theretofore appointed by the Agency. Photostatic copies of each such instrument shall be delivered promptly by the Agency to the predecessor Fiduciary and to the Fiduciary so appointed by the Bondholders. If no appointment of a successor Fiduciary shall be made pursuant to the foregoing provisions of this Section, the Holder of any Bond Outstanding hereunder or any retiring Fiduciary may apply to any court of competent jurisdiction to appoint a succes- sor Fiduciary. Such court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a suc- cessor Fiduciary. Any Fiduciary hereafter appointed, if not the Agency or its successor entity, shall be a bank or trust company authorized by law to exercise corporate trust powers and subject to examination by federal or state authority, of good standing and having at the time of its appointment a combined capital and surplus aggregate not less than Fifty Million Dollars ($50,000,000). [END OF ARTICLE IV] - 32 - a'l ARTICLE V EXECUTION OF INSTRUMENTS BY BONDHOLDERS AND PROOF OF OWNERSHIP OF BONDS SECTION 501. PROOF OF EXECUTION OF DOCUMENTS AND OWNERSHIP. (a) Any request, direction, consent or other instrument in writing required by this Resolution to be signed or executed by Bondholders may be in any number of concurrent instruments of similar tenor and may be signed or executed by such Bondholders in person or by their attorneys or legal representatives appointed by an instrument in writing. Proof of the execution of any such instrument and of the ownership of Bonds shall be suffi- cient for any purpose of this Resolution and shall be conclusive in favor of the Fiduciary with regard to any action taken by it under such instrument if made in the following manner: (1) The fact and date of the execution by any person of any such instrument may be proved by the verification of any officer in any jurisdiction who, by the laws thereof, has power to take affidavits within such jurisdiction, to the effect that such instrument was subscribed and sworn to before him, or by an affidavit of a witness to such execu- tion. Where such execution is in behalf of a person other than an individual, such verification shall also constitute sufficient approval of the authority of the signor thereof. ( 2) The ownership of Bonds shall be proved by the registration books required to be maintained pursuant to the provisions of this Resolution. Nothing contained in this Article shall be construed as limiting the Fiduciary to such proof, it being intended that the Fiduciary may accept any other evidence of the matters herein stated which it may deem sufficient. (b) If the Agency shall solicit from the Holders any request, direction, consent or other instrument in wr i ting re- quired or permitted by this Resolution to be signed or executed by the Holders, the Agency may, at its option, fix in advance a record date for determination of Holders entitled to give each request, direction, consent or other instrument, but the Autho- rity shall have no obligation to do so. If such a record date is fixed, such request, direction, consent or other instrument may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of Bonds have authorized or agreed or consented to such request, direction, consent or other instrument, and for that purpose the Bonds shall be computed as of such record date. (c) Any request or consent of the Holder of any Bond shall bind every future Holder of the same Bond in respect of anything done by the Agency or any Fiduciary in pursuance of such request or consent. [END OF ARTICLE V] - 33 - :35 ARTICLE VI MISCELLANEOUS PROVISIONS SECTION 601. MODIFICATION OR AMENDMENT. Except as other- wise provided in the second paragraph hereof, no adverse material modification or amendment of this Resolution, or of any resolu- tion amendatory hereof or supplemental hereto, may be made with- out the consent in writing of (i) the Holders of more than fifty (50%) per centum in aggregate principal amount of the Bonds then Outstanding or (ii) in case less than all of the several Series of Bonds then Outstanding are affected by the modification or amendment, the Holders of more than fifty (50%) per centum in aggregate principal amount of the Bonds of each Series so affected and Outstanding at the time such consent is given; pro- vided, however, that no modification or amendment shall permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon, or affecting the promise of the Agency to pay the pr incipal of and interest on the Bonds, as the same mature or become due, from the Pledged Funds, or reduce the per- centage of Holders of Bonds required above for such modification or amendment, wi thout the consent of the Holders of all the Bonds. For the purposes of this Section 601, to the extent any Series of Bonds is secured by a Credit Facility or Liquidity Facility, then the consent of the issuer of the Credit Facility or Liquidity Facility shall constitute the consent of the Holders of such Series. This Resolution may be amended, changed, modified and altered without the consent of the Holders of Bonds or any Credit Facility or Liquidity Facility: (a) to cure any ambiguity or formal defect or omis- sion in this Resolution or in any supplemental resolutions or to correct or supplement any provision contained herein which may be defective or inconsistent with any other provi- sions contained herein; or (b) to grant to or confer upon the Bondholders any addi tional rights, remedies, powers, author i ty or secur i ty that may lawfully be granted to or conferred upon the Bond- holders or (c) to add to the conditions, limitations and re- strictions on the issuance of Bonds under the provisions of this Resolution, other conditions, limitations and restric- tions thereafter to be observed; or (d) to add to the covenants and agreements of the Agency in this Resolution other covenants and agreements thereafter to be observed by the Agency or to surrender any right or power herein reserved to or conferred upon the Agency; or (e) to permit the issuance of Bonds, the interest on which is intended to be excludible from gross income for Federal income tax purposes under the Code to the Holders thereof in coupon form, if as a condition precedent to the adoption of such supplemental resolution, there shall be delivered to the Agency an opinion of counsel of recognized standing relating to municipal bonds to the effect that the issuance of Bonds in coupon form is then permitted by law and that the issuance of such Bonds in coupon form would not cause interest on such Bonds to be included in gross income for Federal income tax purposes under the Code to the Holders thereof; or - 34 - :!f; (f) to permit the Agency to issue Bonds the interest on which is not excludible from gross income for Federal income tax purposes under the Code to the Holders thereof; or (g) to qualify the Bonds or any of the Bonds for registration under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended; or (h) to qualify this Resolution as an "indenture" under the Trust Indenture Act of 1939, as amended; or ( i) to make such changes as may be necessary to adjust the terms hereof, including the provisions of Section 304 (D), so as to facili ta te the issuance of Var iable Rate Bonds, Capital Appreciation Bonds, Capital Appreciation and Income Bonds, Put Bonds, Extendible Maturity Bonds, Balloon Bonds, Interim Bonds and such other Bonds as may be market- able from time to time; or (j) to permit Bonds to be issued in book entry form with or without physical bonds; or (k) to make such changes comply with the provisions of the clusion of interest on the Bonds under; or as may be necessary to Code relating to the ex- from gross income there- (l) to make such changes as may evidence the right and interest herein of an issuer of a Credit Facility or a Liquidity Facility that secures any Series of Bonds. If at any time the Agency shall so request the Trustee, the Trustee shall cause a notice of a proposed supplemental resolu- tion requiring the consent of Bondholders to be mailed, postage prepaid, to all Holders of Bonds then Outstanding at their addresses as they appear on the registration books. Such notice shall briefly set forth the nature of the proposed supplemental resolution and shall state that a copy thereof is on file at the principal corporate trust office of the Trustee for inspection by all Bondholders. The Trustee shall not, however, be subject to any liability to any Bondholder by reason of its failure to mail the notice required by this Section, and any such failure shall not affect the validity of such supplemental resolution when consented to or approved as provided in this Section. Whenever, at any time after the date of the mailing of such notice, the Agency shall deliver to the Trustee an instrument or instruments purporting to be executed by the Holders of at least a majority in aggregate principal amount of the Bonds then Out- standing, which instrument or instruments shall refer to the proposed supplemental resolutions descr ibed in such notice and shall specifically consent to and approve the adoption thereof, and the Agency shall deliver to the Trustee a certificate signed by the Chairman that the Holders of such required percentage of Bonds have filed such consents, the Agency may adopt such supple- mental resolutions in substantially such form without liability or responsibility to any Holder of any Bond, whether or not such Holder shall have consented thereto. It shall not be necessary for the consent of the Holders to approve the particular form of any proposed supplemental resolution, but it shall be sufficient if such consent shall approve the substance thereof. If the Holders of more than fifty per centum (50%) in aggre- gate principal amount of the Bonds of each Series as affected and Outstanding at the time of the execution of such supplemental resolution shall have consented to and approved the adoption thereof as herein provided, no Holder shall have any right to object to the adoption of such supplemental resolution, or to - 35 - 'l f"1 .J i object to any of the terms and provisions therein contained, or the operation thereof, or in any manner to question the propriety of the adoption thereof, or to enjoin or restrain the Agency from adopting the same or from taking any action pursuant to the pro- visions thereof. The consent of the Holders of any additional Series of Bonds to be issued hereunder shall be deemed given if the underwriters or initial purchasers for resale consent in writing to such sup- plemental resolution and the nature of the amendment effected by such supplemental resolution is disclosed in the official state- ment or other offering document pursuant to which such additional Series of Bonds is offered and sold to the public. SECTION 602. SEVERABILITY OF INVALID PROVISIONS. I f any one or more of the covenants, agreements or provisions of this Resolution should be held contrary to any express provision of law or contrary to the policy of express law, though not express- ly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions, and shall in no way affect the validity of any of the other provisions of this Resolution or of the Bonds issued hereunder. SECTION 603. SALE OF BONDS. Except as otherwise provided in Section 20l with respect to the Series 1989 Bonds, the Bonds shall be issued and sold at one time or from time to time and at such price or prices consistent with the provisions of the Act and the requirements of this Resolution as the Agency shall here- after determine by resolution. SECTION 604. CAPITAL APPRECIATION BONDS; CAPITAL APPRE- CIATION AND INCOME BONDS. (a) For the purposes of (i) receiving payment of the redemption price if a Capital Appreciation Bond is redeemed prior to maturity, or (ii) computing the amount of Bonds held by the registered owner of a Capital Appreciation Bond in giving to the Agency any notice, consent, request or demand pursuant to this Resolution for any purpose whatsoever, the principal amount of a Capi tal Appreciation Bond shall be deemed to be its Accreted Value. (b) For the purpose of (i) receiving payment of the redemption pr ice if a Capi tal Appreciation and Income Bond is redeemed prior to maturity, or (ii) computing the amount of Bonds held by the registered owner of a Capital Appreciation and Income Bond in giving to the Agency any notice, consent, request or demand pursuant to this Resolution for any purpose whatsoever, the pr incipal amount of a Capi tal Appreciation and Income Bond shall be deemed to be its Appreciated Value. SECTION 605. UNCLAIMED MONEY. Notwi thstanding any pro- visions of this Resolution, any money held by any Fiduciary for the payment of the principal or redemption price of, or interest on, any Bonds and remaining unclaimed for five (5) years after the principal of all of the Bonds has become due and payable (whether at maturity or upon call for redemption), if such money were so held at such date, or five (5) years after the date of deposit of such money if deposited after such date when all of the Bonds became due and payable, shall be repaid to the Agency free from the provisions of this Resolution, and all liability of the Fiduciary with respect to such money shall thereupon cease; provided, however, that before the repayment of such money to the Agency as aforesaid, the Agency shall first publish at least once in a financial newspaper or journal published and/or of general circulation in New York, New York, a notice, in such form as may be deemed appropriate by the Agency with respect to the Bonds so - 36 - 38 payable and not presented, and wi th respect to the provisions relating to the repayment to the Issuer of the money held for the payment thereof. SECTION 606. TIME OF TAKING EFFECT. This Resolution shall take effect immediately upon its adoption. PASSED AND ADOPTED this 21st day of June , 1989. (SEAL) Attest: 1 , ~ew FORM APPROVED REDEVELOPMENT AGENCY GENERAL COUNSEL 8Y~~ ?r.~ Oate 'PS-/8"! ~ ~ ~~;L Secretary Prepared by Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel, P.A., Bond Counsel G ~,....,.{ ! t" (Off, tUJ;cM r T/llMNof I Ho In- f./I;) , . . ~, (J.A. - 37 - ;)9 EXHIBIT A SERIES 1989 REDEVELOPMENT PROJECT The acquisition and clearing of all or portions of Block 9 of Ocean Beach Subdivision, recorded in Plat Book 2, Page 38, of the Public Records of Dade County, Florida, and Blocks 53, 78 and 80 of Ocean Beach Addition No.3, recorded in Plat Book 2, Page 81 of the Public Records of Dade County, Florida in the City of Miami Beach, Florida, which blocks are located within the designated Redevelopment Area. Acquisition and construction of certain streetscape and infrastructure improvements along Alton Road between 1st and 2nd streets, along 1st and 2nd streets between Alton Road and Washington Avenue, and along Meridian Avenue between 1st and 2nd streets. A-I EXHIBIT B BOND FORM (Face of Bond) No. R- $ UNITED STATES OF AMERICA STATE OF FLORIDA MIAMI BEACH REDEVELOPMENT AGENCY TAX INCREMENT REVENUE BONDS, SERIES Interest Rate Maturity Date Date of Original Issuance CUSIP REGISTERED OWNER: DOLLARS PRINCIPAL AMOUNT KNOW ALL MEN BY THESE PRESENTS that the Miami Beach Redevelopment Agency (the "Agency"), for value received, hereby promises to pay to the registered owner specified above, or registered assigns, on the date specified above, but solely from the sources hereinafter mentioned, upon presentation and surrender hereof at the principal corporate trust office of , as paying agent (said and/or any bank or trust company to become successor paying agent being herein called the "Paying Agent"), the pr incipal sum specif ied above with interest thereon at the rate per annum specified above, payable on the first day of and of each year, commencing on Pr incipal of this Bond is payable at the office of the Paying Agent in lawful money of the Uni ted States of AIDer ica. Interest on this Bond is payable by check or draft of the Paying Agent made payable to the registered owner as its name and address shall appear on the registry books of , as Registrar (said and any successor Registrar being herein called the "Registrar") at the close of business on the fifteenth day of the calendar month preceding each interest payment date or the date on which the pr incipal of this Bond is to be paid (the "Regular Record Date"). Any interest not punctually paid on an interest payment date shall forthwith cease to be payable to the registered owner on the Regular Record Date and may be paid to the registered owner as of the close of business on a special record date for the payment of such defaulted interest to be fixed by the Paying Agent, notice whereof shall be given not less than lO days prior to such special record date to the registered owners. Such interest shall be payable from the most recent interest payment date next preceding the date of authentication to which interest has been paid, unless the date of authentication is an 1 or 1 to which interest has been paid, in which case from the date of authentication, or unless the date of authenti- cation is prior to 19 in which case from , 19 , or unless the date of authentication is between a Record Date and the next succeeding interest payment date, in which case from such interest payment date. B-l 11 This Bond is one of an author i zed issue of Bonds of the Agency designated as its "Tax Increment Revenue Bonds, Ser ies " (herein called the "Bonds"), in the aggregate pr in- cipal amount of Dollars ($ ) of like date, tenor, and effect, except as to number, date of maturity and interest rate, issued for the purpose of ( ) under the authority of and in full compliance with the Constitu- tion and Statutes of the State of Florida, including particularly Chapter 163, Part III, Florida Statutes, as amended from time to time, and other applicable provisions of law, and a resolution duly adopted by the Agency on 19 (hereinafter referred to as the "Resolution") and is subject toall the terms and conditions of the Resolution. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE SIDE HEREOF AND SUCH FURTHER PROVI- SIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH ON THE FRONT SIDE HEREOF. It is hereby certified and recited that all acts, conditions and things required to exist, to happen, and to be performed, precedent to and in the issuance of this Bond exist, have hap- pened and have been performed in regular and due form and time as required by the Laws and Consti tution of the State of Flor ida applicable thereto, and that the issuance of this Bond, and of the issue of Bonds of which this Bond is one, is in full compli- ance with all constitutional, statutory or charter limitations or provisions. IN WITNESS WHEREOF, the Miami Beach Redevelopment Agency has caused this Bond to be signed by its Chairman, either manually or wi th his facsimile signature, and the seal of the Miami Beach Redevelopment Agency or a facsimile thereof to be affixed hereto or imprinted or reproduced hereon, and attested by the Executive Director, either manually or with his facsimile signature. MIAMI BEACH REDEVELOPMENT AGENCY CHAIRMAN (SEAL) Attest: EXECUTIVE DIRECTOR B-2 42 FORM OF CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds delivered pursuant to the within mentioned Resolution. Date of Authentication: as Registrar By: Authorized Officer B-3 1~l [Back of Bond] This Bond is payable solely from and secured by a first lien on and pledge of the Trust Fund Revenues (as defined in the Reso- lution) collected by the Agency pursuant to Section 163.387, Florida Statutes, as amended, and other moneys held in certain funds and accounts established under the Resolution (collec- tively, the "Pledged Funds"), all in the manner provided in the Resolution. Neither the Agency, the State of Florida (the "State") nor any of its political subdivisions is obligated to pay this Bond or the interest hereon except from the Pledged Funds pledged thereto and nei ther the fai th and credi t nor the taxing power of the Agency, the State or any of its political subdi visions is pledged to the payment of the pr incipal of, or the interest on, this Bond. This Bond does not cons t i tu te an indebtedness of the Agency or the City of Miami Beach (the "City") within the meaning of any constitutional, statutory or other provision or limitation and it is expressly agreed by the Holder of this Bond that such Holder shall never have the right to require or compel the exercise of the ad valorem taxing power of the City, or taxation in any form on any real or personal property therein, for the payment of the principal of and inter- est on this Bond or the making of any other Sinking Fund (hereinafter descr ibed) and other payments provided for in the Resolution. It is further agreed between the City and the Holder of this bond that this Bond and the obligation evidenced thereby shall not constitute a lien upon property owned by or situated within the corporate territory of the Agency or the City, but shall constitute a lien only on the Pledged Funds, all in the manner provided in the Resolution. Under the provisions of Section l63. 387, Flor ida Statutes, as amended, the Agency has established a Redevelopment Trust Fund into which Dade County, Florida (the "County") and the City have agreed to deposit on an annual basis their respective portions of the Trust Fund Revenues for so long as the Bonds are outstanding. The Agency in the Resolution has established with as trustee (said and any successor trustee being herein called the "Trustee") the Miami Beach Redevelopment Agency Sinking Fund and certain accounts therein and covenanted to deposi t into said Sinking Fund and accounts therein solely from funds on deposit in the Redevelopment Trust Fund sufficient moneys to provide for the timely payment of principal of and interest on the Bonds and to create a reserve therefor, all to the extent and in the manner provided in the Resolution. Refer- ence is hereby made to the Resolution for the specific provisions governing the Bonds. [Redemption provisions] Addi tional Par i ty Bonds may be issued by the Agency from time to time upon the conditions and within the limitations and in the manner provided in the Resolution. The original registered owner, and each successive regis- tered owner of this Bond shall be conclusively deemed to have agreed and consented to the following terms and conditions: l. The Registrar shall keep books for the registration of Bonds and for the registration of transfers of Bonds as provided in the Resolution. The Bonds shall be transferable by the regis- tered owner thereof in person or by his attorney duly authorized in writing only upon the books of the Agency kept by the Regis- trar and only upon surrender hereof together with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney. Upon the transfer of any such Bond, the Agency shall issue in the name of the transferee a new Bond or Bonds. B-4 'll' 2. The Agency, the Trustee, the Registrar and the Paying Agent may deem and treat the person in whose name any Bond shall be registered upon the books kept by the Registrar as the abso- lute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such Bond as the same becomes due, and for all other purposes. All such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the Agency, the Trustee, the Paying Agent, nor the Registrar shall be affected by any notice to the contrary. 3. At the option of the registered owner thereof and upon surrender hereof at the principal corporate trust office of the Registrar with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney and upon payment by such registered owner of any charges which the Registrar or the Agency may make as provided in the Resolution, the Bonds may be exchanged for Bonds of the same series and maturity of any other authorized denomina- tions. 4. In all cases in wh ich the pr i v i lege of exchang ing Bonds or transferring Bonds is exercised, the Agency shall execute and the Registrar shall authenticate and deliver Bonds in accordance with the provisions of the Resolution. There shall be no charge for any such exchange or transfer of Bonds, but the Agency or the Registrar may require payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid wi th respect to such exchange or transfer. Nei ther the Agency nor the Registrar shall be required (a) to transfer or exchange Bonds for a period of l5 days next preceding an interest payment date on such Bonds or next preceding any selection of Bonds to be redeemed or thereafter until after the mailing of any notice of redemption; or (b) to transfer or exchange any Bonds called for redemption. 8-5 45 [FORM OF ABBREVIATIONS FOR BONDS] The following abbreviations, when used in the inscription on the face of the wi thin Bond, shall be construed as though they were written out in full according to applicable laws or regula- tions. TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with the right of survivor- ship and not as tenants in common UNIFORM GIFT MIN ACT - Custodian (Minor) (Cust) under Uniform Gifts to Minors Act (State) Additional abbreviations may also be used though not in the above list. [FORM OF ASSIGNMENT FOR BONDS] For value received, and transfers unto and all rights thereunder, appoints said Bond on the in the premises. the undersigned hereby sells, assigns the wi thin Bond, and hereby irrevocably constitutes and , attorney to transfer the bond register, with full power of substitution Dated: Please insert Social Security or other identifying number of transferee: Signature guaranteed: NOTICE: The transferor's signature to this Assignment must correspond with the name as it appears on the face of the within Bond in every particular without alteration or any change whatever. B-6 ,16 EXHIBIT C AGENCY CERTIFICATE Southeast Bank, N.A., as Trustee Miami, Florida The undersigned authorized official of the Miami Beach Redevelopment Agency hereby certifies that payment of the amounts specified in the requisition to which this Certificate is attached, when added to all other payments made, from proceeds of the Miami Beach Redevelopment Agency Tax Increment Revenue Bonds, Ser ies 1989 (the "Ser ies 1989 Bonds") will not resul t in less than 95 percent of the net proceeds of the Series 1989 Bonds and the investment earnings thereon or attributable thereto being used for "redevelopment purposes" wi thin the meaning of Section l44(c) of the Internal Revenue Code of 1986, as amended. Dated: MIAMI BEACH REDEVELOPMENT AGENCY By: Authorized Official C-l 1', 33 g .. ....- ~~~ COc,: C C.: II II II ~. ~ g. E ~ t .. ... c g ~.:: c_ ~ ... II - e .. i =,; ~~ ~ .. II .. gt13 ~t~ E::E~ OIl -- .. 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It,!..'.:: III 0... .- ;...-." -'==-C 1-0.1)1= PRI<:LJMINARY PRIVATE PLACEMENT MEMOHANDUM HATED JUNI<: _,1989 NEW ISSUE In the oplnwn of Bond Coufl8el, aBJumlng continuing complulflce by the Agency with certain tax covenants, under exl.tlng 'UltuU'. regulation., ruling. and court deCI8Wfl8, Inurnt on the Ser~s 1989 BonrU IS excluded (rom grollS Income for federal income Ulx purpo.e., except (orintue,t on ally Sene. 1989 Bond (or any period dUring whICh .uch Ser~, 1989 Bond 18 held b~ a ~'Ub.tolltUll u.erR of the raclllt~. financed With the proceeds of the Su~, 1989 BontU or a ~relaud perlOn- w,th,ll the meamng of Section 147(a) of the lnurnal Revenue Code of 1986, a. amended. However,.ee ~Tax Matter," herein (or a descnptwn of the alurnatlUe mlmmum tax Imposed on indlUldlUll. and corporatwflB and certain other federal tax consequences of oWMr.hlp of the Ser~' 1989 BonrU. Bond Coun.ell8 further o( the opinwn that the Seru. 1989 BonrU and the Inl.€rest thereon are exempt from Ia.UJtion under the law. of the Stal.€ of Florida, except as ta e'Ulk UlUS and taxes Impo.ed by Chapkr 220, Floridn Statul.€s, on inurest, income or profits on debt obligation. oWflf?d by corporatwf18 aB defiMd In Bald Chapter 220. $6,000,000* MIAMI BEACH REDEVELOPMENT AGENCY Tax Increment Revenue Bonds Series 1989 J8..ed: July I, 1989 Due: December 1,2004 The Tax Increment Revenue Bonds, Series 1989 (the ftSeries 1989 Bondsft), will be issued by the Miami Beach Redevelopment Agency (the ftAgencyft) in registered form only, in denominations of $100,000 each or any integral multiple thereof. Interest on the Series 1989 Bonds is payable on December 1,1989, and semi-annually thereafu!r on each June 1 and December I, by check or draft mailed to the persons in whose names the Series 1989 Bonds are regisU!red as of the close of business on the 15th day of the calendar month immediately preceding an interest payment date, drawn on Southeast Bank, N.A., Miami, Florida (the "TrUBtee,ft the RRegistrarft and the ftpaying Agentft). Principal of and redemption premium, if any, on the Series 1989 Bonds will be payable at the principal corporate trust office oftbe Paying Agent. Upon redemption, the principal of, and premium, if !lny, Qn the Series 1989 Bonds and interest accrued thereon to the date of r@d@mption lirA payable at the principal corporate trust office of the Paying Agent. The Series 1989 Bonds will be subject to optional redemption and mandatory sinking fund redemption prior w maturity by the Agency as described herein under the caption ftREDEMPTION PROVISIONS." The Series 1989 Bonds are pa;)"able solely from the TaI Increment Revenues (as herein defined) received by the Agency from the Redevelopment Area, wgetber with other available moneys and investments in the funds and accounts (other than the Rebate Fund) under the Bond Resolution (the "Pledged Funds"). The Series 1989 Bonds do not constitute a debt, liability or obligation orthe Agency for which the fuU faith and credit or the taIing power of the AlIeney. the City of Miami Beach, Florida (the "City"), Dad@ Count)", FlQrida (the "Cvunty") vr tbe State of Florida (the "State") is pledged, and the Agency is not obligated to pay the Series 1989 Bonds or the redemption premium, if any, or the interest thereon eIcept from the Pledged Funds. None of the Agency, the City, the County, the State or any political subdivision thereof shall ever be required to levy ad valorem taIes for the purpose of paying the Series 1989 Bonds or making any other payments associated with the Series 1989 Bonds, and the Series 1989 Bonds shall not constitute a lien upon any property within the Agency or the City except with respect to the Pledged Funds, as more fully described herein. The Agency has no taxing power. The realization of sufficient Tn Increment Revenues for the payment of the Series 1989 Bonds will be dependent upon a variety of factors and circumstances which the Agency cannot predict with certainty. See the Projection Report attached as Appendix A hereto and "RISK FACTORS," herein. Interest Rate: % Price: $ (Accrued interest to be added) The Sui4!s 1989 Bonds are offered for delivery when, a. and ifissued, ,ubJect to prior lIOle, withdrawal or modification of the offer without notice and .ubject to receipt of the approving opinion of Grunberg, Trourig, Hoff1fUJn. Lipoff, Roun & Quentel. P .A., Miami, Florida, Bond Counul. Certain legal matter. will be JXUud upon for tM Agency by its Generol Counul, Arnald M. Weiner, Miami Beach, Florida, and for the Placement Agents by their co-counul, Baker & Daniels, Indianapolis, Indiana, and McCrory & Self, Miami, Florida. Shear,oll Lehman Hutton Inc. is acting as Financial Advisor to the Agency. It u expected that tM Series 1989 Bonds will be aooi14ble for delivery in New Y or., New Yor. on or about July --' 1989. The following firms are acting as Placement Agents for the Sene, 1989 Bonds: Chase Securities, Inc. Lazard Freres & Co. PaineWebber Incorporated July _,1989 , I , \ '- 18 MIAMI BgACH REDEV~:LOPMENT AGENCY Chairman Alex Daoud Vice Chairman Stanley H. Arkin Com missioners Bruce Singer Abe Resnick William E. Shockett Ben Z. Grenald Sidney Weisburd General Counsel Arnold M. Weiner Executive Director Rob W. Parkins Secretary Elaine M. Baker Financial Advisor SHEARSON LEHMAN HUTTON INC. Bond Counsel GREENBERG, TRAURIG, HOFFMAN, LIPOFF, ROSEN & QUENTEL, P.A. .19 NOTICE TO PROSP~:CTIVE INVESTORS TillS PRIVATE PLACEMI-:NT MEMORA~DUM IS CONFIDENTIAL AND IS FURNISHED TO YOLo SOLELY FOR TilE PURPOSE OF EVALUATING TilE INVESTMENT OFFERED IIEREBY, EXCEPT FOR CONSULTATION ON A CONFIDENTIAL BASIS WITII THE PROSPECTIVE IN\'ESTOR'S FINANCIAL OR LEGAL COUNSEL, ITS USE OR ITS DISSE~lINATION IS PROIIIBITED, TilE INFORMATION CONTAINED HEREIN MAY NOT BE REPRODUCED OR CSED, IN WIIOLE OR IN PART, FOR ANY OTHER PURPOSE, THE OFFERING OF THE MIAMI BEACII REDEVELOPMENT AGENCY TAX INCREMENT REVENUE BONDS, SERIES 1989 (TilE "SI<:RIES 1989 BONDS"), IS BEING MADE EXCLUSIVELY TO A LIMITED NUMBER OF INSTITUTIONAL INVESTORS WHICH ARE WILLING AND ABLE TO CONDUCT AN INDEPENDENT INVESTIGATION OF TilE MATERIAL RISKS INVOLVED WITH OWNERSIIIP OF THE SERIES 1989 BONDS. CERTAIN OF SUCH RISKS ARE SET FORTH AND SUM~'ARIZED IN THE SECTION OF THIS PRIVATE PL\CEMENT MEMORANDUM ENTITLED "RISK FACTORS" AND IN TilE PROJECTION REPORT AT'rACHED HERETO AS APPENDIX A, BOTH 01" WHICH, TOGETHER WITH ALL OTHER PROVISIO;-.JS AND APPENDICES OF THIS PRIVATE PLACEMENT MEMORANDUM, SHOULD BE READ IN THEIR ENTIRETY BY PROSPECTIVE INVESTORS. CHASE SECURITIES, INC., LAZARD FRERES & COMPANY AND PAINEWEBBER INCORPORATED ARE ACTING AS THE PLACEMENT AGENTS FOR THE SERIES 1989 BONDS (THE "PLACEMENT AGENTS"). ALL OJ-' THE PLACEMENT AGENTS WILL BE A V AILABLE TO ANSWER QUESTIONS FROM PROSPECTIVE INVESTORS AND THEIR REPRESENTATIVES CO~CERNING THE TERMS AND CONDITIONS OF THE OFFERING AND WILL FURNISH ADDITIONAL INFORMATION (TO THE EXTENT THE PLACEMENT AGENTS HA VE OR CAN ACQUIRE SUCH INFORMATION WITHOUT UNREASONABLE EFFORT OR EXPENSE) REQUESTED BY PROSPECTIVE INVESTORS TO VERIFY THE INFORMATION FURNISHED IN THJS PRIVATE PLACEMENT MEMORANDUM. THE SERIES 1989 BONDS HAVE NOT BEEN REGISTERED UNDER THE FEDERAL SECURITIES LA WS OR THE SECURITIES LAWS OF THE STATE OF FLORIDA OR ANY OTHER ST.-\TE, AND ARE OFFERED PURSUANT TO CERTAIN EXEMPTIONS UNDER FEDERAL AND STATE SECURITIES LAWS. THE SERIES 1989 BONDS HA VE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES AGENCY, AND NO REGULATORY BODY HAS PASSED UPON OR ENDORSED THE ACCURACY, ADEQUACY OR CO~'PLETENESS OF THIS PRIVATE PLACEMENT ~'EMORANDUM OR THE SERIES 1989 BONDS. ANY REPRESENTATION TO THE CO~TRARY IS UNLAWFUL. THE SERIES 1989 BONDS ARE OFFERED SUBJECT TO PRIOR SALE OR WITHDRAWAL, CA..~CELLATION OR MODIFICATION OF THE OFFER WITHOUT NOTICE AND SUBJECT TO THE APPROVAL OF CERTAIN LEGAL MATTERS BY COUNSEL AND CERTAIN OTHER CO~DITIONS. NO SERIES 1989 BONDS MAYBE SOLD WITHOUT DELIVERY OF THIS PRIVATE PLACEMENT MEMORANDUM. 50 No dealer, broker, salesman, agent or other person has been ftuthoriu'd to givf> any information or to make any representations. other than as contained in this Private Placement Memorandum, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Private Placement Memorandum does not constitute an offer to sell or the solicitation of an offer to buy, and there shall not be any sale of the Series 1989 Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth in the main text of this Private Placement Memorandum has been obtained from the Miami Beach Redevelopment Agency (the "Agency") and other sources .'hich are believed to be reliable, and the information set forth in Appendix B hereof has been obtained from the Agency and the City of Miami Beach, but no such information is guaranteed as to accuracy or completeness, The information and expressions of opinion herein are subject to change without notice and neither the delivery of this Private Placement Memorandum nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the information or opinions set forth herein Rfter tbe date of this Private Placement Memorandum. TABLE OF CONTENTS Page INTRODUCTION ...................................................... ] THE SERIES 1989 BONDS ............................................ 2 REDEMPTION PROVISIONS ............................. ............ 3 ESTIMATED SOURCES AND USES OF FUNDS ....................... 4 SECURITY AND SOURCES OF PAYMENT FOR THE SERIES ]989 BONDS ................................................. 5 THE PROJECT ........................................................ ]] RISK FACTORS ....................................................... ]2 TAX MAT'I'ERS ....................................................... ]4 LITIGATION .......................................................... 15 LEGAL MAT'I'ERS .................................................... 16 PRIVATE PLACEMENT ............................................... 16 OTHER MAT'I'ERS .................................................... 16 AUTHORIZATION CONCERNING PRIVATE PLACEMENT MEMORANDUM ....................................... 17 APPENDIX A - "Projection of Tax Increment Revenues in the South Pointe Redevelopment Area. Miami Beach, Florida, 1989 - 1993" ..................... A-I APPENDIX B - General Information Pertaining to Metropolitan Dade County and the City of Miami Beach. Florida .......... B-1 APPENDIX C - Summary of Certain Provisions of the Bond Resolution ...... C-I APPENDIX D - Form of Bond Counsel Opinion ........................... D-I i , ~ ,,' C'j o:l. PRIV ATE PLACEMENT MEMORANDUM $6,000,000* MIAMI BEACH REDEVELOPMENT AGENCY Tax Increment Revenue Bonds Series 1989 INTRODUCTION The purpose of this Private Placement Memorandum, including its Appendices, is to set forth certain informatJOn with respect to the issuance and sale by the Miami Beach Redevelopment Agency (tht: "Agency") of its $6,000,000* aggregate principal amount of Tax Increment Revenue Bonds, Series 1989 (the "Series 1989 Bonds"). The Series 1989 Honds are being issued pursuant to (i) Resolution No. ,duly ,-duple,] by thE- Agency on June 21, 1989 (the "Bond Resolution"), as approved by Resolution :\0. adopted by the City Commission of the City of Miami Beach, Florida (the "City"), on June 21, 1989, and as further approved by the Board of County Commissioners of Dade County, Florida (the "C<mnly"), on June 20, 1989, and (ii) the provisions of the Florida Community Redevelopment Act, Chapter 163, Part III, Florida Statutes (together with other applicable provisions of Florida law, the "Act"). In accordance with the Act, a certain portion of the City known as the "South Pointe Redevelopment Area" (the "Redevelopment Area") has been designated as a redevelopment area under a redevelopment plan (the "Redevelopment Plan"), and a redevelopment trust fund (the "lkdevelopment Trust Fund") has been established for financing or refinancing community redevelopment projects in the Redevelopment Area, including the payment of revenue bonds issued to finance the undertaking of any community redevelopment under the Act. Such bonds are payable from Tax Increment Revenues and other available revenues and funds derived from or held in connection with the undertaking and carrying out of community redevelopment projects in the Redevelopment Area. Under the Act, "Tax Increment Revenues" are defined to be the amount, determined annually, representing 95% of the difference between (i) the amount of ad valorem taxes le\;ed each year by the City and the County (exclusive of debt service millage) on all taxable real property within the boundaries of the Redevelopment Area and (ij) the amount of such taxes that would have been produced if the City and the County had applied the applicable tax levy rate (exclusive of debt service millage) upon the total assessed value of all real property in the Redevelopment Area as of the date prior to the date of the establishment of the Redevelopment Trust Fu..~d (the "Base Year"). See the caption, "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1989 BONDS - Tax Increment Revenues - General." The Series 1989 Bonds represent the first series of obligations to be issued by the Agency payable out of the Tax Increment Revenues deposited into the Redevelopment Trust Fund and all other moneys, securities and instruments held in the funds and accounts (other than the Rebate Fund) created and established under the Bond ~Iution (collectively, the "Pledged Funds"). The Series 1989 Bonds are being issued to provide funds to (i) finance the acquisition and clearing of and related improvements to certain property in the Redevelopment Area in accordance with the Redevelopment Plan for the construction and equipping of one or more projects, consisting, among ol~r things, of any or aJ1 of multi-unit residential, commercial and parking components (the "Project"); (ij) fund the Debt Service Reserve Account, as defined and described herein; and (iii) pay a portion of the costs of issuance of the Series 1989 Bonds. Under the Act and the Bond Resolution, the Series 1989 Bonds and any additional bonds issued under the Bond Resolution on a parity therewith (the" Additional Bonds" and, together with the Series 1989 Bonds, the "Bonds") will not be deemed to constitute either (i) a debt, liability or obligation or (ii) a pledge of the faith and credit or the taxing · Estimated, subject to change c,; ~7 oJiY power of the Agency, the City, the County, the State of Florida (the "State") or any other political subdivision thereof, and will be payahle solely from the Pledged Funds. None of the Agency, the City, th~ County or the Slate or any other political subdivision thereof will ever be required to levy ad l'alorem taxes to pay the principal of or interest on the Series 1989 Bonds or to make any of the sinking fund, reserve or other payments required by the Bond Resolution or the Series 1989 Bonds. The Series 1989 Bonds will not constitute a lien upon any property owned by or situated within the corporate territory of the Agency or the City except as provided in the Bond Resolution and described herein with respect to the Pledged Funds. The Agency has no power to levy ad ualorem taxes for any purpose, and the ability of the Agency to collect Tax Increment Revenues sufficient to meet its obligations under the Bond Resolution, including the payment of the Series 1989 Bonds, will be subject to a variety of economic and demographic circumstances and cannot be predicted with certainty. See "RISK FACTORS" herein and Appendix A, "Projection of Tax Increment Revenues in the South Pointe Redevelopment Area, Miami Beach, Florida, 1989 - 1993" (the "Projection Report"). There follows in this Private Placement Memorandum a brief description of the security and sources of payment for the Series 1989 Bonds, Bondholder risks, the Project to be financed in part out of the proceeds of the Series 1989 Bonds, and summaJ"ie5 of ceriain provisions of the Series 1989 Bonds and the Bond Resolution. All references to the Act and the Bond Resolution are qualified in their entirety by reference to the Act and the Bond Resolution, with copies of the Bond Resolution available from the Agency or the Placement Agents. All references to the Series 1989 Bonds are qualified in their entirety by reference to the definitive form of and the information with respect to the Series 1989 Bonds contained in the Bond Resolution and any subsequent determinations with respect to the Series 1989 Bonds that may be adopted by or on behalf of the Agency. The Projection Report relating to the Agency, the Project and the Tax Increment Revenues is set forth in Appendix A; certain additional information concerning the Project and certain background information relating to the City are set forth in Appendix B; and a summary of certain provisions of the Bond Resolution is set forth in Appendix C. Each of the Appendices to this Private Placement ~emorandum is an integral part of this Private Placement Memorandum and should be read in its entirety by any and all owners or prospecti ve owners of the Series 1989 Bonds. THE SERIES 1989 BONDS Description ofthe Series 1989 Bonds The Series 1989 Bonds will be issued in the aggregate principal amount, will bear interest at the rates, and will mature in the amounts and on the dates, all as set forth on the cover page of this Private Placement Memorandum. The Series 1989 Bonds will be dated July 1, ] 989, and will bear interest payable on December I, 1989, and semi-annually thereafter on June 1 and December 1 of each year (each, an "Interest Payment Date"). The Series 1989 Bonds will be issuable only as fully registered bonds in the denomination of $100,000 or any integral multiple thereof. Interest on the Series 1989 Bonds is payable by check or draft, mailed to the respective persons in whose names the Series 1989 Bonds are registered as of the close of business on the 15th day of the calendar month immediately preceding an Interest Payment Date (each, a "Record Date"), drawn on Southeast Bank, N.A. (the "Trustee," the "Registrar" and the "Paying Agent"). If and to the extent there is a default in the payment of the interest due on any such Interest Payment Date, the defaulted interest will be paid to the persons in whose names the Series 1989 Bonds are registered with the Registrar as of the close of business on a special record date (the "Special Record Date") established by notice mailed by the Registrar to the registered owners not less than 10 days preceding such Special Record Date. The principal of and redemption premium, if any, on the Series 1989 Bonds are payable at the principal corporate trust office of the Paying Agent. The Series 1989 Bonds will be subject to redemption as set forth herein under the caption "REDEMPTION PROVISIONS." -2- . i 1 \ ,,' 53 Transfer and ~;xchange A tthe option of the registered owner thereof and upon surrender thereof at the principal corporate trust office of the Registrar with a written instrument of transfer satisfactory to the Registrar duly executed by the registered owner or his or her duly authorized attorney, and upon payment by such owner of any charges which the Registrar or the Agency may make as provided in the Bond Resolution, the Series 1989 Bonds may be exchanged for Series 1989 Bonds of the same aggregate principal amount and maturity of any other authoriwd denomination. Subject to any restrictions on transferability, assignment or resale that may be imposed upon the purchasers of the Series 1989 Bonds at the time of the purchase of the Series 1989 Bonds, the Series 1989 Bonds may be transferred on the registration books of the Agency by the registered owner, in person or by his or her duly authorized attorney, by proper written instrument of transfer in form and with guaranty of signatures satisfactory to the Registrar However, the Registrar will not be required to transfer any Series 1989 Bonds between the Record Date or Special Record Date and any Interest Payment Date or special Interest Payment Date. In addition, the Registrar will not be required to (a,\ transfer or exchange any Series 1989 Bond r(p' a period or 15 days prior to any selection of Series 1989 Bonds to be redeemed or thereafter until after mailing any notice of redemption, or (b) transfer or exchange any Series 1989 Bonds called for redemption. L' pon the surrender of any Series 1989 Bond for transfer, a new, fully registered Series 1989 Bond of the same maturity and in the same aggregate principal amount and bearing the same rate of interest will be issued. The person in whose name any Series 1989 Bond is registered on the registration books will be deemed and treated as the absolute owner thereof for purposes of receiving payment of the principal of, redemption premium, if any, and the interest due thereon and for all other purposes, and the Agency and the Registrar will not be affected by any notice to the contrary. REDEMPTION PROVISIONS Optional Redemption On and after December 1, 1999, the Series 1989 Bonds are subject to redemption at the option of the Agency, in whole at any time, or in part on any Interest Payment Date, by lot and at the following redemption prices (expressed as a percentage of the principal amount thereoO, together with accrued interest to the date of redemption: Dates of Redemption (both dates inclusive) Redemption Price December 1,1999 to November 30,2000 ............... 102% December 1, 2000 to November 30, 2001 ............... 101% December 1, 200 I, and thereafter ..................... 100% Mandatory Sinking Fund Redemption The Series 1989 Bonds are subject to mandatory sinking fund redemption, by lot, on December 1, 1990 and on each December 1 thereafter, out of available funds deposited by the Agency to the credit of the Bond Redemption Account established under the Bond Resolution, at a redemption price equal to 100% of each Series 1989 Bond (or portion thereoO to be redeemed plus accrued interest to the date fixed for redemption, in the amounts and the years set forth below: Redemption Date (December 1) Principal Amount to be Redeemed 1990 1991 1992 $ -3- ~4 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 (/inal maturity I Notice of Redemption At least 30 days prior to any redemption, a written notice of redemption will be mailed, postage prepaid, to all registered owners of the Series 1989 Bonds to be redeemed at their addresses as they appear on the registration books of the Registrar, but failure so to mail such notice to llny registered lh'''IWi' of u :';. ','ies 1989 Bond or any defect in such notice will not afTect the validity of the proceedings for such redemption with respect to any other registered owner of a Series 1989 Bond for which notice of redemption has been properly given, Each notice will set forth the CCSIP number, if any, the certificate number, the called amounts of each certificate, date of issue, interest rate and maturity date of the Series 1989 Bonds to be redeemed and will also include the dat~ fixed for redemption and the redemption price to be paid, ESTIMATED SOURCES AND USES OF FUNDS I t is expected that the proceeds of the Series 1989 Bonds will be applied as follows: Sources Proceeds of Series 1989 Bonds Accrued Interest Funds Contributed by the Agency $ TOTAL SOURCES $ Uses Deposit to Acquisition and Construction Fund Deposit to Debt Service Reserve Account Accrued Interest Placement Agents' Fee Costs of Issuance $ TOTAL $ -4- 55 SI<;CUHITY AND SOUHCES OF PAYMI<:NT FOH THE SEHIES 1989 BONDS The Series 1989 Bonds are payable only out of the Tax Increment Revenues and from other PI(-dged Funds under the Bond Resolution. The Scries 1989 Bonds do not constitute an indehtedness of the Agency, the City, the County, the State or any other political subdivision thereof within the mcaning of any constitutional, statutory or other provision or limitation. The lien of the Series 1989 Bonds does not attach until Tax Increment Revenu('s are deposited into the Redevelopment Trust Fund, and the owners of the Series 1989 Bonds will never have the right to require or compel the exercise of the ad valorem laxing power of the County or the City, or laxation in any form on any real or personal property therein, for the payment of the principal of or interest on the Series 1989 Bonds or the making of any other payments required under the Bond Resolution. The Agency has no power to le,.y ad valorem taxes for any purpose. Tax Increment Revenues - - General The Bonds are secured in part by the pledge of Tax Increment Revenues deposited intp the Rt:ct:vclopment Trust Fund established by an ordinance adopted pursuant to the Act. Each taxing authority that is required to make payments to the Redevelopment Trust Fund must do so on or before ,January 1 of each year. Within the Redevelopment Area, the only taxing authorities required to make payments of Tax Increment Hevenues to the Redevelopment Trust Fund are the City and the County. Required payments by the City and the County to the Redevelopment Trust Fund are based on the as~ssed valuation measurement date for taxable real property as of January 1 of the previous year. Pursuant to the Act, on or before each January I, each such taxing authority must appropriate and pay to the Redevelopment Trust Fund an amount equal to 95% of the difference between: (1) The amount of ad valorem taxes levied each year by that taxing authority, exclusive of any amount from any debt service millage, on taxable real property contained within the geographic boundaries of the Redevelopment Area; and (2) The amount of ad valorem taxes which would ha ve been produced by the rate upon which the tax is levied each year by or for that taxing authority, exclusive of any debt service millage, upon the assessed valuation of the taxable real property in the Redevelopment Area as of the Base Year, January 1, 1976. The resulting incremental increase in ad valorem taxes is used to measure the amount of the contribution which must be appropriated and contributed by each taxing authority which is required to make payments. Under Florida law, the statutory obligation of the City and the County to make the required payments to a duly established redevelopment trust fund continues for so long as a redevelopment agency has indebtedness pledging tax increment revenues to the payment thereof outstanding, but not to exceed 30 years from the adoption of the ordinance providing for funding of the redevelopment trust fund. However, the City's obligation under its municipal code to make such payments is limited to the amount, if any, of tax revenues actually received. See the caption, "RISK FACTORS" herein. Additionally, the obligation of the governing body which established the redevelopment agency to fund the redevelopment trust fund annually continues until all loans, ad'"ances and indebtedness, if any, and interest thereon, of a redevelopment agency incurred as a result of redevelopment in a redevelopment area have been paid. The Agency has covenanted in the Bond Resolution diligently to enforce its right to receive and dispose of the Pledged Funds and has agreed that it will not take any action which would impair or adversely affect the Pledged Funds or the right to receive such revenues. With respect to the payment of the Series 1989 Bonds, to understand the method of measuring and calculating the contribution of Tax Increment Revenues required to be made by the taxing authorities, the general method offixing millage provides pertinent background. -5- \ , ~. ". ::'6 Generally. Florida law currently mandates the following procedures in fixing mi lIuge rutes: (a) January I of each year is the statutory measurement date used by each county property appraiser for estahlishing just value of real property within the county Real property improvements or portions thereof not substantially completed on January I arc deemed to have no value placed thereon, and substantially completed property as of January I is assessed by the county property appraiser based on itsjust value. (b) On or before July I of each year, each county property appraiser is required to complete an assessment of the value of all property located within the county (unless extended for good cause by the State Department of Revenue). Upon completion of this assessment, the county property appraiser is required to certify to each taxing authority the taxable value within the jurisdiction of the taxing authority. This certification includes the just value of new construction, additions to structures, deletions and property added due to geographic boundary changes substantially complete as of January I of each year. (c) Each taxing authority is required to compute the milJ(l~r,r:> kr.own a~ the "rolled back rate." That rate is the rate which, exclusive of (i) new const"uction, (iiJ additions to structures, (iii) deletions, and (iv) property added due to geographic boundary changes, will provide the same ad valorem tax re"'enue for each taxing authority as was levied during the prior year. (d) Upon preparation of a tentative budget, but prior to adoption thereof, each taxing authority in addition to computing the "rolled back rate" is required to compute the proposed millage rate which would be necessary to fund the tentative budget, other than the portion of the budget to be funded from other than ad L'alorem taxes. In computing proposed or final millage rates, each taxing authority utilizes not less than 95% of the taxable value certified by the county property appraiser. In establishing the tentative budget and the proposed millage rate, the taxing authority is not bound by the "rolled back rate" and, in accordance with Florida law, may exceed the "rolled back rate" or may eyen adopt a tentative budget and proposed millage rate which would be less than the "rolled back rate." (e) Within 35 days of the county property appraiser's certification, each taxing authority is required to advise the county property appraiser of its proposed millage rate and the "rolled back rate" and the date and time at which a public hearing will be held to consider the proposed millage rate and the tentative budget. The county property appraiser utilizes this information in preparing the notice of proposed property taxes required to be mailed to property owners. Additionally, if this information is not provided in a timely fashion as required by statute, the taxing authority is prohibited from levying a millage rate greater than the "rolled back rate" for the upcoming fiscal year. <0 Each taxing authority is statutorily required to hold a minimum of two public hearings on the proposed millage rate and tentative budget prior to adopting a final millage rate and a final budget. At the first public hearing, the taxing authority may amend the tentative budget and proposed millage rate as it seems fit and adopt a tentative budget and proposed millage rate. At the second public hearing, the taxing authority may adopt the final budget and final millage rate. The final budget and final millage rate adopted at the second hearing cannot exceed the tentative budget and tentative millage rate adopted at the first public hearing. Except as otherwise provided by statute, no millage rate (exclusive of ad valorem debt service millage) for the County and the City may annually exc:eed 10 mills each without voter approval. The final millage rate is that millage rate used to calculate the tax increment revenue payments required to be made to a redevelopment trust fund on or before January 1 of the next year. Final millage rates generally should have been adopted by October 1 of each year, to allow sufficient time for taxing authorities to calculate the required payment to the redevelopment trust fund and to submit the same on or before January 1. Pursuant to statute, unless otherwise permitted by law, final budgets must be adopted by taxing authorities prior to the beginning of a taxing authority's fiscal year. Typically, property tax statements are mailed on or about November I, with collection through -6- b7 ~u\'('mber 30 providing a maximum discount of 4% and descending to 0% as of March 1 of the following year. Taxes arc delinquent as of Aprill. Tax Increment Revenues for the Redevelopment Area - - Historical and Projected The Tax Increment Revenues will be collected by the Agency pursuant to the Redevelopment Plan, as amended, originally adopted in 1976, which is the Base Year for the calculation of such Tax Increment Revenues. The aggregate assessed value of taxable real property in the Redevelopment Area as of July 1,1976, used for determining the incremental assessed valuation in future years, was $59,637,130. The amount of Tax Increment Revenues to be received in any year depends upon the assessed valuation of taxable real property in the Redevelopment Area as of each January], the incremental increase in such valuation above the valuation for the Base Year and the total millage rat.e levied by the relevant laxing authorities (including the County). All of these factors are beyond the control or prediction of the Agency. However, based upon historical data and estimates of new construction of privately owned projects, including the Project, in the Redevelopment Area and growth and projected growth in real estate values resulting from public and private investment in the R1:~evel(lpmcnt Area, the Agency's feilsibilily consultants, Hewitt, Olson, Smoker & ASsoclules, inc., Fort Lauderdale, Florida, have prepared projections of Tax Increment Revenues for the Re-development Area for the years 1989 - 1993, set forth in the Projection Report as Appendix A. Such projections ha ve been prepared only with respect to the years 1989 through] 993, and the Agency has not projected collections of Tax Increment Revenues for the remaining years in which the Series] 989 &nds will be outstanding. The projections set forth in the Projection Report are based upon certain analytical, economic and demographic assumptions stated therein, and the Projection Report should be read in its entirety as a central and integral part of this Private Placement ~emorandum. The following table, which is based upon and contained in substantially identical form in the Projection Report., sets forth historical and anticipated collections of Tax Increment Revenues in the Redevelopment Area from calendar year ]982 through calendar year 1993, This table should be considered in conjunction with the entire Projection Report., including the assumptions made therein, set forth in Appendix A, The Agency cannot provide any assurances that the Tax Increment Revenues actuaIJy realized will meet the forecasts in the Projection Report. See the captions, "RISK FACTORS" and "LITIGATION," herein. -7- " ~8 MIAMI 8fo:ACII Kfo:Ufo:Vfo:1.01''''fo:~T AGfo:~CY IIISTORIC AND PROJfo:Cn:U TAXABLE REAL I'ROPt:RTY A:'IID TAX INCREMENT' Increment Annual Tolal ofTauble Change in County Cil) Calendar Taxable Real Taxable Counly Cil)' Pa)'ments Pa)'ments Tolal Tax \' car 1 Rcal Propcrly 2 Values Milla2e Millullc 95(~ 95'\ Increment Properly 1982 $ 84,627,427 $ 24,990.297 5.726 7.410 $ 135.940 $ 175,919 $ 311,859 1983 80,950,25 I 21,313,121 .4.3 6.297 7.480 127.498 151,451 278.949 1984 79,290,258 19,653,128 .2.1 7.059 8.554 131,795 159,707 291,502 1985 77,569,320 17,932,190 ,2.2 7.474 8.554 127 ,324 145,722 273,046 1986 85,806,721 26,169,591 10.6 7.295 9.666 1B1,362 240,308 421,670 1987 87,9B6,125 2B,348,995 2.5 7.289 9.966 205,064 ~ 256,8664 461,930 198B 105,208,875 45,571,745 19.6 7.2!S9 9.966 315.564 431,460 747,024 1989 109,365,000 49,727,870 3.8 7.289 9.966 344,343 470,809 815,152 1990 110,91 !i.000 51,277,870 1.4 7.289 9.9(;f, 355.076 ";85,483 840,560 1991 115,665.000 56,027,870 4.1 7.2!S9 9.96ti 3B? ,96!S 530,455 9Hl,423 1992 122,132,000 62,494,870 5.3 7.289 9.966 432,749 591,6B3 1,024,432 1993 132,965,000 73,327,870 8.1 7.289 9.966 507.763 694,246 1,202,009 Taxable Real Property is based on the January I assessment of each year. The Agency receives lax increment revenues, as indicated for each calendar year, in January of the following year. Consequently, for example, "Total Tax Increment" ligures for calendar year 1989 would be received by the Agency 011 January 1,1990, and would be available during the 1990 calendar year to pay debt service on the Series 1989 Bonds and to be applied to other authorized purposes under the Bond Resolution. 2 The Redevelopment Area was created in 1976 with an mitial unable value of$59.637,130 (base year). The "Increment of Taxable Real Property" is the value of taxable real property in the current year minus the value of ta](able real property in the base year. 3 Includes interest paid by the County through January] 98B as a result of late payment of tax increment for 1987. 4 Includes an additional payment by the City. Source: Miami Beach Redevelopment Agency and Hewitt, Olson, Smoker & Associates, Inc. The following table sets forth estimated debt service requirements for the Series 1989 Bonds and estimated debt service coverage to be provided from Tax Increment Revenues and other available funds under the Bond Resolution. For the years 1990 through 1994, such debt service coverage estimates are based upon the Projection Report prepared by Hewitt, Olson, Smoker & Associates, Inc. as set forth in Appendix A and summarized in the table above. HOWEVER, THE PROJECTION REPORT SETS FORTH NO PROJECTIONS OF TAX INCREMENT REVENUES AVAILABLE TO PA Y DEBT SERVICE ON THE SERIES 1989 BONDS AFTER JANUARY 1, 1995. BASED UPON THE ESTIMATES OF THE AGENCY, THE TABLE BELOW ASSUMES CONSTANT RECEIPTS OF TAX INCREMENT REVENUES ON AND AFTER JANUARY 1, 1994, BUT ACTUAL TAX INCREMENT REVENUE RECEIPTS MA Y VARY SIGNIFICANTLY AND COULD BE LESS THAN SUCH ESTIMATES. SEE THE CAPTION "RISK FACTORS." Total o..bt Service Requireaen... EstI...led Tu IDue.ent Reyen.u.. A,'wble For Debt Servke 3 Estlm.u.d ADDUal Coyerage Principal or Sink.In, FuDd Requlre_eDb laterest Requiremenu Year 1990 1 1991 1992 1993 1994 $ 81f>.1f>2 840,~ 918,423 1.024.432 1.2W.1IOO -8- ~9 1 ~~I" :l :ll..!,nuo IV!": ."),~.(HHI I~~I~ .':O:,U.kHl I\I~~ ":fl'.!.IHJ(J IY!f~ :':O:.!.IHHI :.!un(1 1 .!O''':,UC)(J 20tll . .202.000 2llO2 ; .202,()(lO 20tl:l . .102,11OO 20(l4 : ,202,000 Estimatl'b of Tax Increment Revenue accruals for 19!19.1993 tpayabll' on January I of the year followang accrual), based upon the Projection Report bet forth as Appendi:.: A. 2 Estimates of Tax Increment Revenue accruals for 1994.2003 (payable on January 1 of the year following accrual, based upon estimates of the Agency of not less than constant Tax Increment Revenue collections for years after 1993. 3 Amount.5 shown have been collected during thl' previoll>i calendar year for payment to the Agency on January I of the indicated calendar year. Application of Tax Increment Reveaues Deposited into the Redevelopment Trust J<'und Under the Bond Resolution, the Agency has covenanted to maintain the Redevelopment Trust Fund into which all Tax Increment Revenues are to be deposited. The Redevelopment Trust Fund will be held by the Agency, will be maintained separately and distinct from all other Agency funds and will be used only for the purposes and in the manner set forth in the Bond Resolution and in the Act. t: nder the Bond Resolution, the Agency's anticipated annual collections of Tax Increment Revenues deposited in the Redevelopment Trust Fund must be used in the following order of priority: (1) Tax Increment Revenues will first be used, immediately upon receipt and to the full extent necessary, for deposit into an "Jnterest Account" established under the Bond Resolution in such amounts as will be sufficient to pay all interest coming due on the Bonds during the calendar year of such deposit. However, such deposits for interest will not be required to be made into the Interest Account to the extent that sufficient amounts are already on deposit therein. (2) (a) Tax Increment Revenues will next be used, immediately upon receipt and to the full extent necessary, for deposit into a "Principal Account" established under the Bond Resolution, in such amounts as will be sufficient to pay the principal amount of all serial Bonds, if any, that will mature during the calendar year of such deposit. However, such deposits for principal will not be required to be made into the Principal Account to the extent that sufficient amounts are already on deposit therein. (b) Tax Increment Revenues will next be used, to the full extent necessary, for deposit into a "Bond Redemption Account" established under the Bond Resolution, in such amounts as may be necessary to make the mandatory sinking fund redemption payments or payments at maturity. if any, of any term Bonds required to be paid during such calendar year. Amounts in the Bond Redemption Account will be used solely for the purchase or redemption of the term Bonds (including all Series 1989 Bonds) payable therefrom. The Agency may at any time purchase any of such term Bonds at prices not greater than the then redemption price of such term Bonds. If the term Bonds are not then redeemable, the Agency may purchase such term Bonds at prices not greater than the redemption price of such term Bonds on the next ensuing redemption date. The Agency will be obligated to use any moneys in the Bond Redemption Account for the redemption prior to maturity of such term Bonds in such manner and at such times as the term Bonds may be subject to mandatory redemption. If, by the application of moneys in the Bond Redemption Account. the Agency will purchase or call for redemption in any year term Bonds in excess of the applicable pa)'ment or redemption requirements for such year, such excess of term Bonds so purchased or redeemed will be credited in .such manner and at such times as the Executive Director of the Agency may determine over the remaining payment dates. -9- 60 :"/0 distinction or preference will exist in the use of the moneys on deposit in the Redevelopment Trust Fund for payment into the Interest Account, the Principal Account and the Bond Redemption Account, since such accounts are on a parity with each other as to payment from the Redevelopment Trust Fund. (3) Tax Increment Hevenues will next be used, to the full extent necessary and immediately upon receipt, for deposit into the "Debt Service Reserve Account" established under the Bond Resolution to make up the difTerence, if any, between the amount on deposit in the Debt Service Reserve Account (including any reserve account insurance policy or reserve account leUer of credit, as described below) and the aggregate Debt Service Reserve Requirements (as hereinafter defined) for all outstanding Bonds. However, no payments will be required to be made into the Debt Service Reserve Account whenever and as long as the amount deposited therein (including any reserve account insurance policy or reserve account letter of credit in accordance with the Bond Resolution) is equal to the aggregate Debt Service Reserve Requirement for all outstanding Bonds. In the event that any amounts are withdrawn from the Debt Service Reserve Account for payments into the.> Interest Account, Principal Account 0r Bond Hedemption Account, such withdrawals will be subsequently restored in the manner described in the previous paragraph from the first Tax Increment Revenues or other available funds after all required payments have been made into the Interest Account, Principal Account and Bond Redemption Account, including any deficiencies for prior payments, unless the aggregate Debt Service Reserve Requirement is otherwise restored by the reinstatement of the maximum limits of a reserve account insurance policy or reserve account letter of credit. (4) Tax Increment Revenues will next be used for the payment of any obligations issued by the Agency pursuant to the Bond Resolution which obligations are payable from Tax Increment Revenues on a subordinated basis to the Bonds. (5) After making all required deposits and satisfactions of any and all deficiencies or other obligations owed under the preceding paragraphs (1) through (4), the balance of any Tax Increment Revenues may then be used by the Agency for any other lawful purpose. For further information regarding the application of Tax Increment Revenues, see "APPE~DIX C -SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLL'TION." Debt Service Reserve Account The Bond Resolution establishes a Debt Service Reserve Account into which there is required to be deposited or transferred: i. All proceeds of both the Series 1989 Bonds and other Bonds required to be deposited into the Debt Service Reserve Account by the terms of the Bond Resolution or any supplemental resolution with respect to the proceeds of Bonds; ti. All amounts required to be transferred to the Debt Service Reserve Account from another fund or account under the Bond Resolution; and iii. Any other available money or security which the Agency may determine to deposit into the Debt Service Reserve Account. The Bond Resolution provides that, with respect to the Series 1989 Bonds, the Agency will establish in the Debt Service Reserve Account at the time of delivery of the Series 1989 Bonds and be required to maintain therein at all times from available revenues an amount (the "Debt Service Reserve Requirement") equal to the least of (i) maximum annual debt service due on all Series 1989 Bonds outstanding in any fiscal year of the Agency ("Fiscal Year"); (ii) 125% of the average annual debt service due on all Series 1989 Bonds outstanding in all Fiscal Years; or (iti) 10% of the proceeds of the Series 1989 Bonds, as defined in the Internal Revenue Code of 1986, as amended (the "Code"). -10- . i \ \ " fj:l With respect to the Serlea 1989 Bonds, the Debt Service Ruerve Roquirement will equal $ . In lieu of or in sublltitution for all or a portion of any required IlmOuntlil in or deposit!i Into the Debt Service Reserve Account, the Bond Resolution permit. tho Aaency 1.0 CaiUffe to bo deposited Into the Debt Service Reiervc Account a reserve account insurance pol icy or lottor of credit See "Appendix C - SUMMARY OF CERTAIN PROVISIONS Of THE BOND HESOLU'fION." Except as otherwise provided in the Bond Rosolution, amounta in tho Debt Service Ruervc Account will be used only for the purpolile of making paym"nt.6 or principtll of aind interelft on llondli when amounts in the Redevelopment Trust Fund or other available fundi or accounts under the Bond Rosolution are insufficient for such purpose. The Bond Resolution further providos that, for purpolilCi of computing amountll in the Debt Service Reserve Account, Invistments in liuch uccount will bo valwod ot tho lower ofpnr or, ifpurc:hQocd at other thQn por, omortilOCo1d value 4S deOncd AmI du...duuu in the Bond Resolution. Additional Parity Bond. The Agency may issue Additional Bonds on a parity with thE: Series 1989 Bonds as to payment from and lien on the Tax Incroment Revenues and other Pl"dged f'unds, PI'OCet!dli of >>uch Additional Bonds mny be used for any purposes which Bre authorized purauunt to the ^ct. However, Additional Bonds may only be issued upon compliance with the following conditions: (1) The Agency must be current in all deposits required to be made intu th~ various funds and accounts and all payments theretofore required to have been deposited or made by it under thE! provisions of the Bond Resolution, and the Agency must be currently in compliunce with the covenuntl:\ and provisions of the Bond Resolution and any supplemental resolution thert:~fter adopted for the issuance of Additional Bonds unless, upon the issuance ofsuch Additional Bonds, the Agency will be in compliance with all such covenants and proviaions. (2) The amount of the Tax Increment Revenues during the immediately prccodini "'iacsl Year or any 12 consecuti\'e months selocted by the Agency out of the 18 months immediately proceding, alii certified by an independent certified public accountant, were atleasl equal to 125% of the ma)(imum annual debt service requirements on (i) the oubl~nding Series 1989 Bonds, (ii) any outstanding Additional Bonds and (iii) the Additional Bonds proposed to bc issued. (3) The Agency need not comply with paragraph (2) above in the issuance of Additional Rondi if and to the extent the Bonds to be issued are rcfunding Bonds to be delivered in lieu of or in substitution for Bonds originally issued under the Bond Resolution or previou>>ly issued AddiLlonal Bonds, if the Agency causes to be delivered a certificate of its Executive Director setting forth (i) the maximum annual debt service requirements (A) with respect to all Bonds outstanding immgdiat.ely prior to the date of iluthentication and delivery of such refunding Bondll, and (Bl with respect to all Bonds to be outstanding immediately thereaner, and (ii) that the maximum annual debt aervice requirements set forth pursuant to (B) above will be no greater than those >>et forth pursuant 1.0 (A) above. In addition, the Agency may issue obligaUonil payable from Tax Incrcmont Hevenuea on l.l subordinate basis to the Bonds without meeting the foregoing conditions. THE PROJECT The Projt:ct to be financed out of the proceeds of the Sericli 1989 Bonds consilills gf tho acquhiition and clearing of all or a portion of four blocks in the City of :\fiami Beach located within the Redovclopment Area and the acquisition and construction of certain related streetscape and infrastructure improvements. The real property thull acquired will be sold either t.o Cobb Partners South Beach, Ltd., or Rumpco, Inc., as developers of a project consisting of, among other things, the acquisition and construction of approximately 300 residential condominium and related commercial and parking facilities to be designed and constructed in accordanco with proposals mado t.o the -11- t'? . If,.. Aroney, The Aiency anticipate. thllt acquisition and conlltruction of tho Projoct will commence priur to October 1, 1989, but such commencement may be dolayed due to pending 1It/lation over the AienCY'1l takini by eminent domain of portions of the real property required fur the Projoct. See the caption, "LITIGATION," heroin. for further information concerninll the Project, see the Projection Report lIet forth in Appendix A. RISK FACTORS The ability of the Agoncy to make timely paymenb of principal of, redemption premium, if any, and intl.lrOlOt on the Series 1989 Bonds depends llolely upon tho ability ofthe Agency to collect i1ufficienl Tax Increment Revenues based upon real property in the Redevelopment Are~, toiother with earnini's thoroon and other available revenues. The Serios 1989 Bonds are not general obligationll 8upportcd by the rull flllith tmd credit of the Agency, the City, the County or any other political 8ubdi vision of the State, but are payable solely from the Pledged Funds, None uf the Slale, tho County, the City, the Agency or any other political subdivision of the State has any oblii6tion or powor under the Bond Resolution or under Florida ll:iw to levy any taxes or any reiponsibllity thc:n:undtlf to appropri61te funds from any other source whatsoever in order to pay debt service on the Series 1989 Rond. or to avail or cure any default in any such payments. E;xcept for the Debt Service Reserve Account, there ia no fund or account under the Bond Resolution which is requited to contain amounts to make up for any deficiencies in the event of one I,lr more dcfuults by the Agency in making payments of debt service un the Seri~!!I 1989 Bonds, und there IS no source trom whIch the Interest Account or Principal Account will be replenished except the Tax Increment Revenues and investment income on moneys in the Redevelopment Trust l"und. Despite the study which the Agency has caused to be carried out as summarized in the Projection Report, there can be no representation or assurance that the Agency will realize llufficient Tax Incromont Revenues to pay, when due, all required payments of debt lIervice on the Series 1989 Bonds. The Agency has determined to issue the Series 1989 Bond~ in their aggregate principal amount based, in substantial part, on the Projection Report, which necefSsarily mukes certain assumptionlil and projections. Failure of such assumptions and projections to be re",li~cd could result in t.he failure b~' the Agency to collect sufficient Tax Increment Revenues to pay the principal of and interest on the Series 1989 Bonds, The Projection Report projects Tax Increment Revenues collected through 1999 and distributed on or before January 1. 1994, but the Series 1989 Bonds will have a final maturity in 2004. As noted in the discussion of debt service coverage under the caption "SECURITY AND SOURCES OF PAYMENT l-'OR THE SERIES 1989 BONDS." any attempted application or extension of the Projection Report's assu mptiona or projections beyond the .tated projection period is outside the scope of the Projection Report and hal not been contemplated by .uch Repol1. The following paragraphs summarize some of the risks involved in a ~'IC)rida tax increment financing of the type of the Series 1989 Bonds and describo some or the assumptions lIlnd projections made in the Projection Report which, if not realized, eould result in insufficient Tax Increment Revenues for the plllyment of the Series 1989 Bonds. Such summarie$ are not intended to be an exhaustive list of risk factors in connection with the Series 1989 Bond:i. The Projection Report, attached hereto as Appendix A, sets out in greater dotail the assumptions and projoctions discussed herein and therein. The Projttction Report is an inlegr~1 plllrt of this Private PIl:lcemant ~1emorandum and should be read in its entirety by the owners or potential purchasers of the Series 1989 Bonds. Competition from Comparable Developments Outside the Redevelopment Area. The City'lS growth strategy for the Redevelopment Arcti is being and will continuo to be pursued by other communities outside the Redevelopment Area whose growth will not generlllto Tax Increment Revenues for the payment of the Series 1989 Bonds. As lsummarized in the Projection Report, in the event that a large number of condominium or rental projects are constructed ehsowhere -12- , t , \ \ 'Il-- (.;3 in the City outside the Redevelopment Area or outside Dade County, the demand for residential housing within the Redevelopment Area could be reduced, thereby leading 1,0 a reduction in collections of Tax Increment Revenues Failure of Timely Commencement, Completion or Occupancy of the Project or Comparable Projects in the Redevelopment Area. The Projection Report sets forth certain assumptions regarding the commencement and the completion of the Project and the anticipated occupancy dates and rates for the Project and other residential and commercial projects in the Redevelopment Area. As indicated under the caption "UTICA TION ," the commencement of the Project could be delayed due to litigation over the Agency's taking by eminent domain of portions of the real property required for the Project. Such delays could be material. Any failure or delay in commencing or in completing the Project or any of such other projects, or any failure or delay in achieving such occupancy rates, could have an adverse impact upon the realization and collection of Tax Increment Revenues in the Redevelopment Area. Adverse Business Developments Affecting Existing Commerclal and Residential Projects. : Discussion of South Pointe Towel's. Woooy's on the Beach. \1aterial to be supplied from Projection Report.] Failure to Achieve Full Collection of Taxes. The Projection Report assumes collection by the County and the City of 100% of property taxes due in the Redevelopment Area. Because the City's municipal code limits its obligation to make payments to the Redevelopment Trust Fund to those tax revenues actually received with respect to a given calendar year, any failure by the City to achieve collections at the 100% rate would have an adverse impact on the receipt of Tax Increment Revenues. State, National and International Economic and Political Factors. Certain economic or political developments, such as downturns in the State, national or international economy, increased national or international barriers to tourism or trade or international currency fluctuations could all adversely affect the continued development of the Redevelopment Area or its attraction to local businesses of national and internationallourist traffic. The tourist industry in particular is relatively unpredictable, subject to cyclical patterns and sensitive 1,0 fluctuations in international, national and local interest rates, levels of personal income and employment. None of such developments can be certain of prediction or within the control of the County, the City or the Agency, and any such development could adversely affect the ability of the Agency 1,0 receive sufficient Tax Increment Revenues. Reductions in Property Values. Numerous events could occur that would reduce the value of real property within the Redevelopment Area, including natural disasters; public acquisition of property within the Redevelopment Area by the State or political subdivisions exercising their respective rights of eminent domain; or economic or demographic factors beyond the control of the Agency or the taxpayers in the Redevelopment Area. Any or all of such events could adversely affect the realization and collection of Tax Increment Revenues. Impact of Additional Taxpayers or Increased Property Values Outside the Redevelopment Area. Although the Projection Report indicates factors that would make unlikely 8 reduction in County millage rates, the addition of significant numbers of new taxpayers or an increase of property values outside the Redevelopment Area could result in an environment favorable to the reduction of County millage rates that would, in turn, reduce collections of Tax Increment Revenues. Appeals of Assessments. State law allows taxpayers to dispute assessment valuations. Various State, local, national and international economic conditions may influence a taxpayer's willingness to make or forgo such an appeal. The statutory method for determining Tax Increment Revenues uses a factor of 95%, due in part to an expectation of some such -13- f;4 appeals. Any volume of appeals in excess of stich a margin of error could, jf successful, result in decreased collections of Tax Increment Revenues. Adt,t'rse !-egislativl', Judicial or Administratil'l' Action. The State legislature, the courts or an administrative agency with jurisdiction in the matter could cnact new laws or regulations or interpret, amend, alter, change or modify the laws or regulations governing the collection, distribution, definition or accumulation of ad valorem tax revenues generally, or Tax Increment Revenues specifically, in a fashion that would adversely affect the ability of the Agency to pay debt service on the Series 1989 Bonds, TAX MA1'TERS The Internal Revenue Code of 1986, as amended (the "Code"), includes requirements which the Agency must continue to meet after the issuance of the Series 1989 Bonds in order that interest on the SHies 1989 Bonds not be included in gross income for federal income tax purposes. The Agency's failure to meet these requirements may cause interest on the Series ]989 Bonds to be included in gross income for fl:decul incor:;e tax purposes retroactive to their date of issuance. The Agency has co\'enanted in the Bond Resolution to take the actions required by the Code in order to maintain the excl usion from gross income for federal income tax purposes of interest on the Series] 989 Bonds. In the opinion of Bond Counsel, assuming continuing compliance by the Agency with the tax covenants referred to above, under existing statutes, regulations, rulings and court decisions, interest on the Series 1989 Bonds is excluded from gross income for federal income tax purposes, except for interest on any Series 1989 Bonds for any period during which such Series 1989 Bond is held by a "substantial user" of the Project or a "related person" within the meaning of Section ]47(a) of the Code. However, interest on the Series 1989 Bonds is an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, Bond Counsel is further of the opinion that the Series ]989 Bonds and the interest thereon are exempt from taxation under the laws of the State of Florida, except as to estate taxes and taxes imposed by Chapter 220, Florida Statutes, on interest, income or profits on debt obligations owned by corporations as defined therein. Except as described above, Bond Counsel will express no opinion regarding the federal income tax consequences resulting from the ownership of, receipt or accrual of interest on, or disposition of the Series 1989 Bonds. Prospective purchasers of Series 1989 Bonds should be aware that the ownership of Series 1989 Bonds may result in other collateral federal tax consequences, including (i) the denial of a deduction for interest on indebtedness incurred or continued to purchase or carry Series 1989 Bonds or, in the case of a financial institution, that portion of the owner's interest expense allocable to interest on a Series 1989 Bond, (ii) the reduction of the loss reserve deduction for property and casualty insurance companies by 15% of certain items, including interest on Series 1989 Bonds, (iii) for taxable years beginning before 1992, the inclusion of interest on Series] 989 Bonds in "modified alternative minimum taxable income" for purposes of the environmental tax imposed on corporations, (iv) the inclusion of interest on Series 1989 Bonds in the earnings of certain foreign corporations doing business in the United States for purposes of a branch profits tax, (v) the inclusion of interest on Series 1989 Bonds in the passive income subject to federal income taxation of certain Subchapter S corporations with Subchapter C earnings and profits at the close of the taxable year and (vi) the inclusion in gross income of certain Social Security and Railroad Retirement benefits by reason of receipt of interest on the Series 1989 Bonds. On April ll, 1989, Representative Dan Rostenkowski, Chairman of the House Ways and Means Committee, introduced H.R. 1761. For taxable years beginning after ]989, H.R. 1761 would take into account in computing a corporation's alternative minimum tax 100% of certain amounts. such as interest on the Series 1989 Bonds, included in earnings and profits but otherwise excluded from gross income, instead of75% under current law. -14- (;5 LITIGATION Abtenc. otUt1,atJon Relatln, to the Serle. leSe Bond. There Ji no Iiti,atlon pend;ni or threatened that seeks lo rostra in OJ' tmjoin the Issuance or delivery of the Sorie! 1989 Bonda or the proceed in,,::> or authority undor which they are to be Issued or delivered. Thoro is no litigation pending or threatened which, in llny manner, queiltions the right of the Agenc>, to plodge its Tax Incroment Revenues all described her~in to the repayment of tho Series 1989 Bondll. Utl,ation Pertainln, to tbe Project As doscribed above under the caption "THE PROJECT," the Project will involve, amoni other things, the ucquisition of all or a portion of four city blocks for the construction of certain improvements in the Rodevelopment Area. Although the Agency and/or the City currcntly has or haft negothltcd possession of title to approximately 40% of such roal property, the rcml&ining approximately 60% of such property must be acquirod through eminent domuin proceedinill. On June 12, 1989, owners of a parcel ofsuch property (consistini offour (4) lots, which is centrally located within the Project area) filed an answor in the Agency's ominent domain uction, contestini the Agency's right to such a taking by eminent domain. Ownerl:llind interested per:sonll of other pr'i vawly owned parcels within the proposed Project Are expected Lo file answers in two other ominent domain actions on or about July 3, 1989, and such owners and interested per$ons may also dilipute the Agency's eminent. domain riihts with respect to their propertieli. The Agency believe>> that it has lhe power to take the subject properties by eminent domain and believes that such power will be upheld by the courts. The Agency further believes that it will be capable of making any pnyments of adjudicated purchase prieea or such parcels under eminent domain. However, even if the Agency is ulLlmlitely successful, because of the size and the location of the parcels in dispute, such eminent domain litigation could materially delay the commencoment of all or a significant portion of the Project and, con.equantly, the completion of the Project l:md the Project's 41biJity to generate Tax Increment Rovenues to be collected by the Agency for the repayment ofthe Series 1989 Bonds. Other Uti,ation The Agency is currently a party to two lawsuits arising out of contractual di!!lputes. The fil'St., filed in November 1985, arises out of a lease, approved by the Agency, between the City and the developer of the Miami Beach Marina. The developer of tho Marina is S1eekini damagos in the amount of $21 million for the City's alleged breach of its obligations under the leue. The Agency's involvument in the dispute has been limited to itll initial approval of the leasing arrangements between thl: City and the developer, and the Agency believes that, even in the event that the plaintiff is ultimately successful, the possibility of any assessment of significant damages against the Agency is remote. Further, thc action is currently the subject of a proposed iettlement agreement between the developer and a third-party buyer, and the Areney has reason to believe that, out of such agreement, the actioni may be dismissed with respect to all purties on or about September I, 1989. 'rhe second law15uit is a 1982 action against the Agoney by a developer seeking a declaratory judgment 41nd monetary damagos for breach of contract. Although the Cily was also originally a party to this action, the City was dismissed from the case and a judgment in the amount of approximately $3 65 million was entered against the Agency by the circuit court in 1984. Subsoquent to the entry of such judgment, the Agency and the developer entered into a settlement a.greement whereby, among other t.hinglil, the developer would receive a credit against. the purchase price of lllnd to be developed within the Redevelopment Area to the extent or the outstanding balance or the principal amfJunt of the judgment, toget.her with interest thereon. The settlement agreoment is currontly being carriod out by the parties, and the unsatisfied amount of the 1984 judgment is '... 8& of the date of thia Private Placement Memorandum. There is no other litigation pending or threatened which would havo a -15- -... (iG material adverse effect upon the ^iencY'8 nnancial condJLlon or ila ability to cullect Tux Increment Revenues for the payment of the Seriel1989 Bondi. LEGAL MATTERS The Serieg 1989 Bondi will bQ accompanied at d~\ivery with an approvini opinion of Greenber~, TrauriK, HotTman, Lipoff, Rogen & Quent.l, P.A., Miami, Florida, Bond Coun5lel, in lIubstantially the form attached hereto a. Appendix D. Certain lesal mallera wjll be pall9d upon for the ^8'ency by it.a General Counsel, Arnold M. Weiner, Miami Beach, Florida. Certain le8'al maller", will bo palulod upon for the Placement Agents by their co-counsel, Baker & Danieli,lndianupoli>>, Indiana, and McCrary & Self, Miami, Florida. PRIVATE PLACEMENT The Placement Agents have aiTeed pursuant to a placgmont ilifeement with the Aiency to pll1Co the Series 1989 Bonds directly with a limited number of inititutional investors. each of whom will make certain representations to the Agency. The Placement Agenti will receive an aggregate fee of % of the principal amount of the Series 1989 Bonds for acting all Placemont ^sents, OTHER MATTERS The information contained in this Private Placement MCffiQrar.dum is prosented for the iuid~ncc of prospective purchsSlers ofthe Series 1989 Bonds. The information hili boon compiled fl'om official and other sources and, while not guaranteed by the Agency. is believed to be correct, So far as any statements made in this Private Placement Mernonmdum and the Appendices ~tlached hereto involve matters or opinion or ostimates, whether or not so expressly stated, they are set rorth as such and not as representations of fact, and no representation is made th~t any ofthe projections or estimates will be realized. -16- (;'/ AUTHORIZATION CONCERNING PRIVATE PLACEMENT MEMORANDUM The delivery of this Private Placement Memorandum has been duly authorized by the Miami B(:dch Redevelopment Agency Atthe time of the delivery of the Series 198~ Ronds, the Chairman and thEe' Executive Director of the Agency will furnish a certificate to the elTect that nothing has come to thEe'ir attention that would lead them to believe that the Private Placement Memorandum, as of its date and as of the date of delivery of the Series 1989 Bonds, contains any untrue statement of a material fact or omits to state a material fact which should be included therein for the purpose for which the Private Placement Memorandum is intended to be used, or which is necessary to make the statements contained therein, in the light of the circumstances under which they were made, not mi.sleading. MIAMI BEACH REDEVELOPMENT AGENCY Chairman Executive Director ATTEST: Secretary -17- 1 , ~ ,," {)8 ApPENDIX H General Information Pertaining to the City of Miami Beach, Florida, and Dade County. Florida The following information pertaining to the City of Miami Beach, Florida, and Dade County, Florida, is set forth for purposes of background only. The Series] 989 Bonds are payable only from Tax Increment Revenues and other pledged Funds under the Bond Resolution, including the payments by Dade County and the City of Miami Beach, Florida, into the Redevelopment Trust Fund, all as described in this Private Placement Memorandum. The Series] 989 Bonds do not constitute a debt, liability or obligation or a pledge of the faith, credit or any taxing power of the Miami Beach Redevelopment Agency, the State of Florida, or any political subdivision thereof, including Dade County and the City of Miami Beach, Florida. For further information regarding such Tax Increment Revenues, see the caption "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES] 989 BO~ DS" and the Proj"ction Report set forth in Appendix A. I. GENERAL INFORMATION PERTAINING TO THE CITY OF MIAMI BEACH, FLORIDA The City of Miami Beach (the "City") comprises seven square miles of land area and ten square miles of water area located in Dade County, Florida. The weather provides the City with an average year, round temperature of75 degrees Fahrenheit, 24 degrees Celsius. The City is linked to mainland Metropolitan Dade County (the "County") by four causeways - John F. Kennedy Causeway at the northern end, Julia Tuttle Causeway at the mid-point and the Venetian and \facArthur Causeways at the southern end. The City experienced a building and population boom during the] 920'5, ] 930's and] 940's. This "boom" is preserved via the Art Deco District, a one square-mile neighborhood bounded by 6th and 23rd Streets to the north and south, and by Alton Road and Ocean Drive at its easUwest boundaries. This area received official designation as a historic district when listed in the National Register of Historic Places in 1979. Hundreds of apartments, hotels and retail stores feature the classic architecture of the Art Deco style. The renovation and preservation of these buildings has been undertaken mainly by private investors. In the mid-1950's, national air carriers began to provide comprehensi ve service to the area and the City evolved as a major convention destination. During the] 970's, the City was host to both the Democratic and Republican National Conventions. Currently, the Miami Beach Convention Center is undergoing renovations increasing the existing facility to ].] million square feet. Ground was broken for the expansion of the Center on March 26, ] 986, and construction on the site is expected to be completed in . The $80 million renovation will modify the Center into four equal-size halls of 125,000 square feet, each housing meeting rooms, concession and catering areas and loading docks. Each hall will have its own canopied entrance, allowing the facility to house four events at a time or one large event. An open 8,000-square foot area in the center of the second floor crossover walkway will transport delegates and conventioneers through elevators, escalators and stairs, and features a circular restaurant and cocktail lounge, providing a 360-degree view of the entire floor space below. The spirit of renewal and transition can be seen throughout the City. In the South Pointe Redevelopment Area, in addition to the Art Deco District renovations, public projects include the $3,5 million South Pointe Park and $9.8 million in infrastructure improvements. (Other projects located just north of the South Pointe Redevelopment Area include construction of an $18 million Police and Courts Facility and the revitalization of the Lummus Park area including a continuation of a beachfront promenade.) Private development in the South Pointe Redevelopment Area includes the Crawdaddy's Restaurant located in the City's South Pointe Park, Penrod's restaurant located in Pier {)~J PClrk on the b(\HCh and the South Pointc Towers development, a $22 million condominium tower complex. In the City's middle area, puhlic projects include the expansion uf the \tiami Beach Convention Center, the $22 million renovation of the Theater of the Performing Arts, as well as the Garden Center and Conservatory expansion, the 21st Street Community Center and Walkway, Island View Park and the Beachfront Park and Promenade, a 1.8 mile long linear park featuring the natural woods which stretch along the oceanfront from 21st to 46th Streets. Private development in the area includes the South Florida Art Center located on Lincoln Road Mall, additions and renovations to the Alexander Hotel, the Fontainebleau Hilton, the Doral Hotel and the Eden Roc Hotel which are all currently in progress or completed, and a planned convention center host hotel which is in the site development stage. In the City's north area, a joint project between the State of Florida and the City for the expansion o( the North Shore Open Space Park is currently under way. The project includes the acquisition of privately owned parcels which block access to the public beaches and the expansion to the north of a :. :'- .'hfront promenadt!. The City of Miami Beach Plulllling Department has completed a North Shore Revitalization Strategy focusing on the commercial district along Collins Avenue and down 7] st Street. Phase I of the comprehensive plan is a review process and includes the organization of a private non-profit development corporation. Government The City of Miami Beach is organized under the Commission-Manager form of government. The go\'erning body of the City is the City Commission which establishes policies (or proper administration o( the City. The City Commission is composed of seven members, including the Mayor. The Mayor and Commissioners are elected to their offices by an at-large vote of the citizens; the Vice-Mayor is chosen by majority vote of all members of the City Commission. The Mayor and each Commissioner serve a two-year term. The City Commission appoints a City Manager to act as administrative head of the City. The City Manager serves at the pleasure of the City Commission, carries out its policies, directs the operation of the City and has the power to appoint or remove heads of all departments. Transportation Within three hours by air from the major population centers of the northeastern United States, the City is also at the terminus of the interstate highway network. The Port o( Miami, which serves the City, is the largest cruise ship port in the world and is one of the largest exporUimport seaports in the world. The Port of Miami is owned by the County and is operated by the Dade County Seaport Department. From 1983 to 1988, the number of passengers sailing from the Port increased from 2,002,659 to 2,502,411, an increase of24.95%. The Port of Miami specializes in unitized trailer and container cargo handling concepts. The effective use of equipment and the Port's convenient location has combined to make the Port the nation's leading export port to the Western Hemisphere. From 1983 to 1988, the total cargo handled increased from over 2.3 million tons to over 2.6 million tons. an increase of 12.88%. Since 1979, the Port of Miami has increased in size from 300 acres to 525 acres, The additional space accommodates an increasing number of shippers, buyers, importers, exporters, freight forwarders and cruise passengers who wish to utilize the Port. B-2 '70 A five-year summary of the changes In both passengers served and cargo handled is indicated below: Year .:nd Sepl.emher 30 Passengers tlhnusands) Cargo (Tonnalle) 1983 ]984 ]985 1986 1987 1988 2,003 2,2]7 2,327 2,521 2,633 2,502 2,305,645 2,287,281 2,333,026 2,406,084 2,425,937 2,602,556 Source: Dade County Seaport Department. Miami Beach is also within easy access of five airports within the boundaries of Dade County. The responsibility for their operation is assigned to the Dade County A viatiol: Depart,ment. For the year 1987, the Miami International Airport ranked 8th in the nation and 9th in the world in the number of passengers using its facilities and 5th in the nation and 8th in the world in the movement of domestic and international air cargo. Airport services are provided annually to nearly 20 million domestic and international scheduled passengers. The airlines serving the Miami International Airport provide worldwide air routes convenient for importers and exporters. A five-year summary of the passengers served and cargo handled is indicated below: Year End September 30 Passengers Ilhousands) Cargo (Tonna2:e) 1983 1984 1985 1986 1987 1988 19,317 19,152 19,684 21,357 23,800 24,210 570,627 571,865 565,736 600,135 666,719 773,599 Source: Dade County A viation Department. Recreation There are numerous parks and playgrounds in the City of Miami Beach. Each park provides different amenities, from tennis and bocce courts to swimming pools and tot lots, to Vita courses and barbecue pits. There are four Vita courses, two swimming pools, and numerous tennis courts, including the Abel Holtz Tennis Stadium which houses championship, professional and amateur tournaments. To the north of the City, the Miami Beach Sailport offers public access to Biscayne Bay. Offshore, the Gulf Stream provides a variety of game fish, and the newly renovated Miami Beach Marina provides space to house pleasure boats. The $11 million renovation increased the number of wet slips to 388, making the Marina the largest in the area. The Marina is a private development on city-owned bayfront land in the South Pointe Redevelopment Area. For further information regarding the Redevelopment Area, see the Projection Report in Appendix A. The City owns two championship golf courses and one Par 3 course; all are open to the general public. The two championship courses, Bayshore and Normandy, offer clubhouses complete with restaurant, lounge and pro shop. B-3 ,-: '71 St.atistical In(ormation Relating to the City o( Miami Ht>8ch, i"lorida, and Bade County, t10rida ASSESSEI> V ALVATION, TAX LEVIES ANI> COLLECTIONS City of Miami Beach, i"lorida Fiscal Year Ended September 30 Total Net Assessed Valuation (in thousands)l Percen t Charaze Total Tax Levy (in thousands) Percent Collected 1982 1983 1984 1985 19136 1987 1988 3,081,738 3,179,740 3,245,386 3,160,046 3,097,124 3,001,177 3,009,079 3.18% 2.06% (2.63%) O.!:l9';") (1.28%) .26% 29,629 30,632 31,308 38,479 38,897 41,029 4],] 37 95.2% 99.5% 98.9% 95.]% 96.9% 99.4% 99.9% 1 The basis of assessed value is approximately one hundred percent (] 00%) of fair market value. Preliminary certification for year ending September 30, 1989 indicates the net assessed value is $3,138,927,656. For each tiscal year ending September 30 properly is valued as of January 1 st of the preceding calendar year. SOURCE: City of Miami Beach Redevelopment Agency. B-4 ~'2 Dade County, f<'lorida Fiscal Year Ended September 30 Net Assessed Valuation (in thousands)1 Percen t Chan2e Total Adjusted Tax Levy (in thousandsl Percent Collected 1982 1983 1984 1985 1986 1987 1988 40,627,477 42,863,490 44,790,508 46,243,027 48,544,767 50,104,591 51,939,701 5.50% 4.50% 3.24% 4.98% 3.21% 3.66% 635,231 645,583 764,452 853,542 916,058 1,009,108 1,044,458 97.8% 98.5% 999% 98.6% 98.4% 97.3% 98.5% 1 The basis of assessed value is approximately one hundred percent (100%) of actual value. Certified roll for year ending September 30, 1989 indicates that the net assessed value is $55,760,687,405. For each fiscal year ending September 30 property is valued as of January 1 st of the preceding calendar year. 2 Includes Dade County, Dade County Board of Public Instruction, South Florida Water Management District, Public Library District and Special Benefit Districts, but excludes the municipalities in Dade County for which the County collects taxes. SOURCE: Dade County Property Appraisal; Dade County Finance Department, Tax Collection Division. LARGEST PROPERTY TAXPAYERS City of Miami Beach, Florida Owner Assessed Value Alexander Muss & Sons Roney Plaza Seacoast Towers Morton Towers Daniel Malone Carillon Hotel Doral Beach Hotel Ocean Pavilion Hotel Eden Roc Hotel Florida Power & Light $ 84,197,528 41,401,150 37,750,000 24,954,905 15,657,004 15,630,700 14,000,000 13,187,667 13,000,000 11.976.836 Represents 8.7% of Total Taxable Value $ 271.755.790 SoURCE: Metropolitan Dade County, Florida, Department of Property Appraisal; City of Miami Beach, Florida, Valuation Roll. B-5 , t , \ " ',3 Dade County, Florida Owner Assessed Value (in thousands) Southern Bell Telephone & Telegraph Company Florida Power & Light Company Equitable Life Assurance Company Eastern Airlines SEFC Building Corporation Florida East Coast Properties, Inc. Robbie Stadium Corporation Hotelerama Associates Ltd. MICC Venture Biscayne Associates of Pittsburgh $ 1,117,028 1,009,059 329,564 194,774 171,500 112,806 106,703 98,580 96,752 92,382 Represents 6.4% of Total Taxable Value $ 3,329.148 SOURCE: Metropolitan Dade County, Florida, Department of Property Appraisal CITY OF MIAMI BEACH AND DADE COUNTY, FLORIDA Population (in thousands) Miami Beach~ Dade Count}.:1 Florida2 U.S.2 Year Population 'l Chane:e Population 'l Chane:e Population 'l> Cbane:e Population 'l. Chane:e 198] 96.3 0.0 1.729 6.3 9,739 2.8 226,506 1.0 1982 97.3 1.1 1,736 .4 10,375 6.5 231,023 2.0 1983 98.0 1.1 1,734 c .11 10,591 2.1 233,206 0.9 1984 97.3 ( .7) 1,740 .2 10,930 32 236,]62 1.3 1985 96.9 ( .41 1,771 1.8 11,238 3.3 238,444 1.0 1986 96.9 ( .0) 1,798 1.5 11 ,654 3.2 241,888 1.4 1987 97.7 (2.2) 1,829 1.7 12,044 I 3.3 245,625 I .8 1988 1,862 I 1.8 12,4181 3.1 246,048 I .9 1 Estimated SoURCES: 2 University of Florida, Bureau of Economic and Business Research 3 Dade County Planning Department, Research Division B.6 "ll. DADE COUNTY, FLORIDA Per Capita Personal Income (Current Dollars) Dade Count~. (o'lorida l' nited States Percent Year Dollars of U.S. Dollars Dollars 1980 9.541 100.5 9.245 9,494 1981 10,704 101.5 10,386 10,544 1982 11,327 101.9 10.966 11,113 1983 12,027 103.0 11,663 11,681 1984 13,249 103.7 12,773 12,772 1985 13.992 100.6 13.898 13,910 198G 1~,:.lGJ 100.3 14.630 14,639 SOURCE: U.S Department of Commerce, Bureau of Economic Analysis DADE COUNTY, FLORIDA Employment Year Unemployment Rate Dade County Florida U,S. Dade County Ci\'i1ian Emplo)'ment1 (in thousands) 19t!l 1982 1983 1984 1985 1986 1987 1988 :J 9.52 10.1 9.8 7.8 7.5 6.7 5.8 5.6 6.8 8.2 8.6 6.3 6.0 5.7 5.3 5.2 7.6 9.7 9.6 7.5 7.2 7.0 6.2 5.2 761 763 765 788 814 833 860 892 Includes workers by place of residence. Based on sample of working age population. Includes Haitian and Cuban IMariel) refugees. 3 November 1988 preliminary data for U.S., Florida and Dade County SoURCE: U.S. Department of Labor, Bureau of La bor Statistics; State of Florida Department of Labor and Employment Security B-7 ',5 1988 NONAGHICULTUHAL EMPLOYMI<:NT 8Y SI<:CTOH 1 United Slille~ fo"Iorida Dade County Construction~ ,..........................,.., ~1anufacturing ...................... Transportation~ ................. Wholesale and Retail Trade ........ Finance, Insurance and Real Estate Services .......................... Government ........................ 5.7% 18.4 5.3 23.9 6.3 24.0 JM 7.0% 10.4 5.1 27.9 7.1 27.3 ~ 4.9% 11.3 8.1 27.2 8.1 27.1 ~ TOTAL 100.0% 100.0% 100.0% December 1988 preliminary data for li.S, Florida and Dade County. C Construction includes mining; transportation includes utilities. SOUHCES: U.S Department of Labor, Bureau of Labor Statistics; Florida Department of Labor and Employment. B-8 ,,' ',6 TOP 20 EMPLOYERS IN 1988 Dadt> County Firm Dade County Public Schools .......................... Metropolitan Dade County .................................. Eastern Airlinesl ....................................... State of Florida ........................................ Burdines Department Stores ............................. Publix Super Markets, Inc. ............................... Southern Bell Telephone & Telegraph ........................ Public Health TrustlJackson Memorial... . . . . . . . . . . . . . . . . . . . . . Miami-Dade Community College ............................. University of Miami ..... .......................... City of Miami ............................................. The Miami Herald Publishing Company ..................... Southeast Bank, N .A. ...................................... Florida Power & Light Company ............................. American Medical International ............................. Mount Sinai Medical Center of Miami ........................ Baxter Travenol Laboratories ................................ American Telephone & Telegraph ............................ Burger King Corporation .................................... Ryder System, Inc. .......................................... Number of EmpJoyet>s 30,593 22,500 12,] 70 12,100 6,300 6,000 6,000 5,300 4,966 4,500 4,400 4,141 4,135 4,000 3,023 2,750 2,500 2,422 2,300 2,300 I This number reflects total employment prior to the certain developments concerning Eastern Airlines. SOURCE: Miami-Dade County, J<'lorida Profile 1988-1989, Beacon Council. 8-9 '7'7 Pepsico Boise Cascade en ion Carbide Exxon Shell Oil Greyhound Pitney Bowes ARCO Metal Co. Dow Chemical B.F. Goodrich Knight- Ridder Borden Conagna "''';E:stinghouse FOHTUN": ~oo COMPANIES WITH OFFICES IN I>AI>E COUNTY IT& T Rockwell International General Electric Texaco Babcock Co. Burger King Caterpillar Co. Ralston-Purina Dictaphone Corp. DuPont De Nemours Alcoa New York Times Ashland Chemical Motorola Eastman-Kodak Easton Cummins Americas International Paper Firestone Goodyear Owens-Corning Fiberglass Fruehauf Corp Honeywell Inc. Wang Laboratories, Inc. Xerox Belcher Oil Nabisco Navistar International IBM AFA Mack Trucks, Inc. McGraw Edison Pfizer PPG Industries General Tire & Rubber Weyerhauser NCR Hoover Polaroid Corp. United Technologies CD Medical Aircraft ~rvice Internal. SOt'RCE: Directory of Dade County Major Employers, Dade County Industrial Development Authority, October, 1985. Year 198] 1982 1983 1984 1985 1986 1987 VALUE OF BUILDING PERMITS ISSUED City of Miami Beach New Construction 75,562,126 125,556,022 36,663,625 11,897,784 47,508,992 6,593,335 3,804,616 Existing Structures Additions. Rehabilitation. Etc. 22,251,183 ]4,201,833 23,052,215 28,587,383 17,736,022 19,026,892 69,897,353 SOURCE: City of Miami Beach - Building Permit Department B-]O \ \ \ Total Value 97,813,309 139,757,855 59,715,840 40,485,167 65,245,014 25,620,227 73,701,969 ,,' ',8 Dade County, Florida (in thousands) Year New Construction Existing Structures Additions. Rehabilitation, Etc, Total Value 1981 1982 1983 1984 1985 1986 1987 1,457,844 1,100,236 1,087,408 1,281,231 1,280,283 1,307,]63 959,161 211,296 202,979 226,482 221,514 249,097 247,307 241,911 1,669,140 1,303,215 1,313,890 1,502,745 1,529,380 1,554,470 1,201,072 SOl;RCE: University or Florida, Bureau of Economic and Business Research, Building Permit Activity in Florida, 1978-1987. CITY OF MIAMI BEACH AND DADE COUNTY Non-property Tax Revenues Gasoline Taxes Sales Taxes State Reven ue Sharing Year (Dade County). (Miami Beach) (Miami Beach) 1983 55,768,717 23,683,075 2,663,541 1984 63,299,670 22,301 ,909 2,687,912 1985 65,483,158 23,622,990 2,776,361 1986 66,678,039 22,596,092 2,581,211 1987 72,289,011 26,819,421 3,289,180 SOURCE: Florida Department of Revenue · The gasoline tax of 8 cents per gallon was increased to 9.7 cents per gallon effective April, 1983. B-ll f7Q DAnE COUNTY Financial Institution Information Savings & Loan Bank Deposits Bank Loans Deposits Year (in thousands) 1 (in thousands) 2 (in thousands) 3 1983 13,429,861 9,634,325 1 7, 161 ,600 1984 15,191,696 12,596,842 12,047,784 1985 16,721,801 14,987,450 13,628,626 1986 18,897,084 16,174,500 14,339,083 1987 19,249,288 16,475,466 15,191,494 SOUHCES: 1 FloridaBankers Association Report (Federal ReservelFDIC Tapes; 2 Florida Division of Banking, Bureau of Examination; 3 Federal Home Loan Bank Board, Atlanta, Georgia. B-12 t , \ , ,,' ,go ApPENIlIX C SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION 81 There follows a summary of certain provisions of the Bond Resolution. This summary does not purport to be a full statement of the terms of the Bond Resolution and reference is made to the Bond Resolution for a full and complete statement of such provisions. Capitalized terms used in this summary that are not defined have the meanings ascribed to them in the Bond Resolution. Definitions. As used in this Appendix, the following terms have the following meanings: "Accreted Yalue" means, as of any date of computation with respect to any Capital Appreciation Bond, an amount equal to the principal amount of such Capital Appreciation Bond (the principal amount at its initial offering) plus the interest accrued on such Capital Appreciation Bond from the date of delivery to the original purchasers thereof to the Interest Payment Date next preceding the date of computation or the date of computation if an Interest Payment Date, such interest to accrue at a rate not exceeding the legal rate as set forth in the resolution of the Commission providing for the issuance of such Bonds, compounded periodically, plus, with respect to matters related to the payment upon redemption or acceleration of the Capital Appreciation Ronds, if such date of computation is not an Interest Payment Date, a portion of the difference between the Accreted Value as of the immediately preceding Interest Payment Date (or the date of original issuance if the date of computation is prior to the first Interest Payment Date succeeding the date of original issuance) and the Accreted Value as of the immediately succeeding Interest Payment Date, calculated based on the assumption that Accreted Value accrues in equal daily amounts on the basis of a year of twelve 30-day months. "Act" means the Florida Community Redevelopment Act, Chapter 163, Part III, Florida Statutes, as amended, and other applicable provisions of law. "Agency" means the Miami Beach Redevelopment Agency. a body corporate and politic, created pursuant to the Act. "Amortization Requirements" means such moneys required to be deposited in the Bond Redemption Account for the purpose of the mandatory redemption or payment at maturity of any Term Bonds, the specific amounts of such deposits to be determined by the Chairman in the Chairman's Certificate with respect to the Series 1989 Bonds and by the Commission in the resolution authorizing any other Series of Bonds. "Annual Debt Service Requirement" for any period, as applied to the Bonds of any Series, means the respective amounts which are needed to provide: (a) for paying the interest on all Bonds of such Series then Outstanding which is payable on each Interest Payment Date in such period, (b) for paying the principal of all Serial Bonds of such Series then Outstanding which is payable upon the maturity of such Serial Bonds in such period, and (c) the Amortization Requirements, if any, for the Term Bonds of such Series for such period. For purposes of computing (a), (b) and (c) ahove, any principal, interest or Amortization Requirements due on October 1 in a Fiscal Year will be deemed due in the preceding Fiscal Year. The following rules apply in determining the amount of the Annual Debt Service Requirement for any period: (a) The interest rate on Variable Rate Bonds will be assumed to be 110% of the greater of (i) the daily average interest rate on such Yariable Rate Bonds during the twelve months ending with the month preceding the date of calculation or such shorter period that such 1 i , ~. b2 Variable Rate Bonds are Outstanding under the Bond Resolution, and ni) the actual rate of interest on such Variable Rate Bonds on the date of calculation; (b) In the case of Put Bonds, the "put" dute or dates will be ignored if the source for payment of said "put" is a Credit Facility or a Liquidity Facility and the stated dates for Amortization Requirements and principal payments will be used, and in the case of Bonds secured by a Credit Facility or a Liquidity Facility, the terms of the reimbursement obligation to the issuers thereof will be ignored and the stated dates for Amortization Requirements for Term Bonds and principal payments will be used; provided, however, that during any period of time after the issuer of a Credit Facility or a Liquidity Facility has advanced funds thereunder, the reimbursement obligation of which is payable from and secured on a parity with the Bonds and before such amount is repaid, Annual Debt Service Requirements will include the principal amount so advanced and interest thereon, in accordance with the principal repayment schedule and interest rate or rates specified in the Credit Facility or Liquidity Facility, in lieu of the stated principal of and Amortization Requirements and interest on such Bonds; (c) In the case of Extendible Maturity Bonds, the Bonds will be deemed to mature on the later of the stated maturity date or the date to which such stated maturity date has been extended; (d) In the case of Capital Appreciation Bonds, the principal and interest portions of the Accreted Value of Capital Appreciation Bonds becoming due at maturity or by virtue of an Amortization Requirement will be included in the calculations of accrued and unpaid Annual Debt Service Requirements in the year in which said principal and interest portions are due and payable; (e) In the case of Capital Appreciation and Income Bonds, the principal and interest portions of the Appreciated Value of Capital Appreciation and Income Bonds will be included in the calculations of accrued and unpaid Annual Debt Service Requirements in the year in which said principal and interest portions are due and payable; (0 In the case of Balloon Bonds or Interim Bonds, the debt service requirements of the Balloon Bonds or Interim Bonds may be excluded and in lieu thereof the Balloon Bonds or Interim Bonds will be viewed, for purposes of the computation of Annual Debt Service Requirements, as debt securities having a comparable Federal tax status as such Balloon Bonds or Interim Bonds, hypothetically maturing in substantially equal annual payments of principal and interest over a period of not more than 15 years from the date of issuance thereof, bearing interest at a fixed rate per annum equal to the average interest rate per annum for such debt securities on the date of issuance of the Balloon Bonds or Interim Bonds and issued by issuers having a credit rating, issued by Moody's Investors Services, Inc., or any successors thereto or Standard & Poor's Corporation or any successors thereto comparable to that of the Agency, as shown by a certificate of an underwriting or investment banking firm experienced in marketing such securities; and (g) If all or a portion of the principal of or interest on a Series of Bonds is payable from funds irrevocably set aside or deposited for such purpose, together with projected earnings thereon to the extent such earnings are projected to be from Permitted Investments, such principal or interest will not be included in determining Annual Debt Service Requirements. "Appreciated Value" means (i) as of any date of computation with respect to any Capital Appreciation and Income Bond up to the Interest Commencement Date set forth in the resolution of the Commission providing for the issuance of such Bond, an amount equal to the principal amount of such Bond (the principal amount at its initial offering) plus the interest accrued on such Capital Appreciation and Income Bond from the date of delivery to the original purchasers thereof to the Interest Payment Date next preceding the date of computation or the date of computation if an C-2 bJ Interest Payment Date, such interest to accrue at II rute not exceeding the legal rate as sel forth in the res.olution of the Commission providing for the issuance of such Bonds, compounded periodically, plus, with respect to the payment upon redemption or acceleration of the Capital Appreciation and Income Bonds, if such date of computation is not an Interest Payment Date, a portion of the difTerence between the Appreciated Value as of the immediately preceding Interest Payment Date (or the date of original issuance if the date of computation is prior to the first Interest Payment Date succeeding the date of original issuance) and the Appreciated Value as of the immediately succeeding Interest Payment Date calculated based upon an assumption that Appreciated Value accrues in equal daily amounts on the basis of a year of twelve 3D-day months and (ii) as of any date of computation on and after the Interest Commencement Date, the Appreciated Value on the Interest Commencement Date. "Average Annual Debt Service" means, at any time and with respect to all of the Bonds or any particular Series of Bonds (as appropriate), the sum of the Annual Debt Service Requirements for the then current and every succeeding Fiscal Year divided by the number of such Fiscal Years. "Balloon Bonds" means any Bonds issued under the Bond Resolution, interest on which is pci.yable periodically and i.wenty-live percent (25%) or more 0;' .;.(; original principal amount of which matures during anyone Fiscal Year and for which maturing principal amount Amortization Requirements have not been designated in the resolution of the Commission authorizing the issuance of such Bonds. "Bonds" means the Series 1989 Bonds, authorized to be issued pursuant to the Bond Resolution, together with any additional parity Bonds hereafter issued pursuant to the Bond Resolution. ..Bondholder," "Holder," "Holder of Bonds" or "Owner" or any similar term, means any ~rson, who is the registered owner of any Outstanding Bond or Bonds. "Bond Resolution" means Resolution No. ,adopted by the Agency on June _' 1989, authorizing among other things, the issuance of the Series 1989 Bonds, as the same may from time to time be amended and supplemented in accordance with the terms hereof. "Capital Appreciation Bonds" means any Bonds issued under the Bond Resolution as to which interest is compounded periodically on each of the applicable periodic dates designated for compounding and payable in an amount equal to the then current Accreted Value only at the maturity, earlier redemption or other payment date therefor, all as so designated by subsequent proceedings of the Commission relating to the issuance thereof, and which may be either Serial Bonds or Term Bonds. "Capital Appreciation and Income Bonds" means any Bonds issued under the Bond Resolution as to which accruing interest is not paid prior to the Interest Commencement Date specified in the resolution authorizing such Bonds and the Appreciated Value for such Bonds is compounded periodically on certain designated dates prior to the Interest Commencement Date for such Series of Capital Appreciation and Income Bonds, all as so designated by subsequent proceedings of the Commission relating to the issuance thereof and which may be either Serial Bonds or Term Bonds. "Chairman" means the Chairman of the Agency or in the absence or disability of the Chairman, the Vice Chairman of the Agency or the officers succeeding to their principal functions. "Chairman's Certificate" means the Certificate to be executed by the Chairman prior to or at the time of the sale of the Series 1989 Bonds which Certificate will provide the details of the sale of the Series 1989 Bonds. "City" means the City of Miami Beach, Florida. "Code" means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder and applicable regulations promulgated under the Internal Revenue Code of 1954, as amended. C-3 bil "Commission" means the Board of Commissioners of the Agency. "County" means Dade County, f'lorida. "Credit Facility" means an irrevocable letter of credit, policy of municipal bond insurance, guaranty, purchase agreement, credit agreement or similar facility in which the entity providing such facility irrevocably agrees to provide funds to make payment of the principal of, premium, if any, and interest on Bonds. "Defeasance Obligations" means to the extent permitted by law: (a) Direct general obligations of, or obligations the payment of the principal of which and the interest on which is unconditionally guaranteed by, the United Slates of America; and (b) Evidences of indebtedness issued by the Bank for Cooperatives, Federal Home Loan Banks, Federal Home Loan Mortgage Corporation (including participation certificates), Federal Land Banks, Federal Financing Banks, or any other agency or instrumentality of the United States of America created by an ael of Congress which is substantially similar to the ;0regoing in its legal relationship to the United States of America: providf:d that the obligations of such agency or instrumentality arc unconditionally guaranteed by the United States of America or any other agency or instrumentality of the United States of America; and (c) Evidences of ownership of proportionate interests in future interest and principal payments on specified obligations described in (a) above held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor on the underlying obligations described in (a) above, and which underlying obligations are not available to satisfy any claim of the custodian or any person claiming through the custodian or to whom the custodian may be obligated; and (d) Obligations described in Section 103(a) of the Code which do not permit redemption prior to maturity at the option of the obligor and provision for the payment of the principal of, premium, if any, and interest on which have been made by the irrevocable deposit with a bank or trust company acting as a trustee or escrow agent for holders of such obligations or securities described in clauses (a) or (b) above, the maturing principal of and interest on which, when due and payable, will provide sufficient monies to pay when due the principal of, premium if any, and interest on such obligations, and which securities described in clauses (a) or (b) above are not available to satisfy any other claim, including any claim of the trustee or escrow agent or of any person claiming through the trustee or escrow agent or to whom the trustee or escrow agent may be obligated, including in the event of the insolvency of the trustee or escrow agent or proceedings arising out of such insol veney. "Executive Director" means the Executive Director of the Agency. "Extendible Maturity Bonds" means Bonds the maturities of which, by their terms, may be extended by and at the option of the Holders of the Bonds or the Agency. "Fiduciaries" means the Paying Agent, the Registrar and the Trustee appointed and acting under the Bond Resolution. "Fiscal Year" means that period commencing on October 1, and continuing to and including the next succeeding September 30, or such other annual period as may be prescribed by law or by the Agency in accordance with law. "Interest Commencement Date" means, with respect to any particular Capital Appreciation and Income Bonds, the date specified in the resolution providing for the issuance of such Bonds, (which date must be prior to the maturity date for such Bonds) after which interest accruing on such Bonds will be payable semi-annually or otherwise on a periodic basis prior to maturity, with the first such C-4 , t ~ , '" H5 payment date being the applicable Interest Payment Date immediiJlely succeeding such Interest Commencement Dute. .'1 n terest Paymen t Date" means for each Series of Bonds such dates of each Fiscal Yeur on which inlerest on the Bonds is payable on any Bonds that are Outstanding, as sel forth in the proceedings of the Agency providing for the issuance of such Series of Bonds. .'Interim Bonds" means any Bonds issued under the Bond Resolution on an interim basis which are expected to be repaid from the proceeds of Bonds or other indebtedness. "Liquidity ft'acility" means a letter of credit, line of credit, policy of municipal bond insurance, guaranty, purchase agreement or similar facility in which the entity providing such facility agrees to provide funds to pay the purchase price of Put Bonds upon their tender by the Holders of Put Bonds. "Maximum Annual Debt Service" means, at any time and with respect to all of the Bonds or any particular Series of the Bonds (as appropriate), the greatest Annual Debt Service Requirement in the then current or any succeeding Fiscal Year. '.Outsta..ciing" when used with reference to the Bonds, means, as of any date of determination, all Bonds theretofore authenticated and delivered except; (a) Bonds theretofore cancelled by the Registrar or delivered to the Registrar for cancellation; (b) Bonds which are deemed paid and no longer Outstanding as provided herein; (c) Bonds in lieu of which other Bonds ha ve been issued pursuant to the provisions hereof relating to Bonds destroyed, stolen or lost, unless evidence satisfactory to the Registrar has been received that any such Bond is held by a bona fide purchaser; and (d) For purposes of any consent or other action to be taken hereunder by the Holders of a specified percentage of principal amount of Bonds, Bonds held by or for the account of the Agency. "Paying Agent" means Southeast Bank, N .A., any successor bank or trust company appointed by the Agency to act as Paying Agent hereunder. "Permitted Investments" means and includes such obligations as are permitted to be legal investments of the Agency by the laws ofthe State. "Placement Agents" means Chase Securities, Inc., Lazard Freres & Co., and PaineWebber Incorporated. "Pledged Funds" means, collectively, the Tax Increment Revenues and, except for moneys, securities and instruments in the Rebate Fund, all moneys, securities and instruments held in the Funds and Accounts created and established by the Bond Resolution. "Put bonds" means the Bonds which by their terms may be tendered by and at the option of the owner thereoffor payment by the Agency prior to the stated maturity thereof. "Redevelopment Area" means the area within the City found by the City to be a "blighted area" within the meaning of the Act and described in the Redevelopment Plan. "Redevelopment Plan" means the redevelopment plan originally approved by the City on March 2, 1977, as the same has been or may hereafter be amended from time to time and now known as the "South Pointe Redevelopment Area." "Redevelopment Projects" means the particular community redevelopment projects undertaken by the Agency pursuant to the Redevelopment Plan in accordance with the Act, including the Series 1989 Redevelopment Project. C-5 86 .'Registrar" means Southeast Bank, NA. or 1.I bank or 1.I successor trust company appointed by the Agency, located within or without the State of Florida, who or which will maintain the registration books of the Agency and be responsible for the transfer and exchange of the Honds, and who or which may also be the Paying Agent and the Trustee for the Bonds. "Reserve Account Insurance Policy" means the insurance policy, surety bond or other acceptable evidence of insurance, if any, deposited in the Debt Service Reserve Account in lieu of or in partial substitution for cash or securities on deposit therein. The issuer providing such insurance will be a municipal bond insurer rated, at the time of deposit in the Debt Service Reserve Account, in any of the three highest rating categories of either Moody's Investors Service, Inc., or any successors thereof or Standard & Poor's Corporation or any successors thereof. '.Reserve Account Letter of Credit" means the irrevocable, transferable letter of credit, if any, deposited in the Debt Service Reserve Account in lieu of or in partial substitution for cash or securities on deposit therein. The issuer providing such letter of credit will be a banking association, bank or trust company or branch thereof rated, at the time of deposit into the Debt Service Reserve Account, in \lny of the three highest rating categories of either Moody's Investors Service, Inc., or allY successors thereof or Standard & Poor's Corporation or any successors thereof. "Reserve Account Requirement" means the lesser of (i) Maximum Annual Debt Service on all Bonds Outstanding, (ii) 125% of Average Annual Debt Service on all Bonds Outstanding, or (iii) 10% of the proceeds of the Bonds within the meaning of the Code. "Serial Bonds" means the Bonds of any Series which will be stated to mature in annual installments but not including Term Bonds. "Series" means all of the Bonds authenticated and delivered on original issuance and pursuant to the Bond Resolution or any supplemental resolution authorizing such Bonds as a separate Series of Bonds, or any Bonds thereafter authenticated and delivered in lieu of or in substitution for such Bonds pursuant to Article II of the Bond Resolution, regardless of variations in maturity, interest rate or other provisions. '.Series 1989 Bonds" means the Tax Increment Revenue Bonds, Series 1989 authorized to be issued under the Bond Resolution in the aggregate principal amount not to exceed $7,000,000. "Series 1989 Redevelopment Project" means the acquisition and clearing of certain property and the construction of certain related public improvements within the Redevelopment Area being financed with the proceeds of the Series 1989 Bonds. (See "THE PROJECT" in this Private Placement ~emorandum.) "State" means the State of Florida. "Tax Increment Revenues" or "Trust Fund Revenues" means the revenues received by the Agency for deposit in the Trust Fund pursuant to Section 163.387, Florida Statutes, as amended, Ordinance No. 78-20, enacted by the County on April 4, 1978, as amended, and Ordinance No. 77- 2104, adopted by the City on September 7,1977, as amended. "Term Bonds" means the Bonds of any Series which will be stated to mature on one date and for the amortization of which payments are required to be made into the Bond Redemption Account in the Sinking Fund. "Trust Fund" means the redevelopment trust fund established by Ordinance No. 77-2104 adopted by the City on September 7,1977, as amended, in accordance with the Act. "Trustee" means any bank or trust company or any successor bank or trust company appointed by the Agency to act as Trustee hereunder, and which may also be the Paying Agent and Registrar for the Bonds. C-6 " j \ ~ tfi "Variable Hate Honds" means Bonds, which may be either ~rial Bonds or Term Bonds, issued y,ith a variable, adjustable, convertible or other similar rale which is nol fixed in percentage for the entire term thereof at the date of issue. Bond Resolution Constitutes ContracL In consideration of the acceptance of the Bonds aulhorized to be issued under the Bond Resolution by those who will own the same from time to time, the Bond Resolution will be deemed to be and will constitute a contract between the Agency and such Bondholders, and the covenants and agreements therein set forth to be performed by the Agency will be for the equal benefit, protection and security of the owners of any and all of such Bonds, all of which will be of equal rank and without preference, priority, or distinction of any of the Bonds over an)' other thereof except as expressly provided therein and in the Bond Resolution. Co~'enants of the Aj!ency, The Agency rO\lcnants and agrees with the holder~; of 'lr.y ;.nd " ') "r the Bonds issued pursuant to the Bond Resolution as follows: A. Tax Covenants. (1) The Agency will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would result in inclusion in gross income for Federal income tax purposes under Section 103(a) of the Code, of interest on the Bonds. Particularly, the Agency will not take any action or omit to take any action, which action or omission if reasonably expected on the date of the initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code. (2) The Agency will comply with the arbitrage rebate covenants as provided under subheading (E) entitled "Rebate Fund" below. B. Redevelopment Plan. The Agency will carry out the purposes of the Redevelopment Plan ~;ithin the Redevelopment Area all in accordance with the Act and will take all such actions as are required to carry out the full intent of the Redevelopment Plan. C. Trust Fund. As soon as the same are received by the Agency, all of the Tax Increment Revenues will be forthwith deposited into the Trust Fund. The Trust Fund will constitute a trust fund for the purposes provided in the Bond Resolution and will be maintained separate and distinct from all other funds of the Agency and used only for the purposes and in the manner provided in the Bond Resolution and the Act. D. Disposition of Tax Increment Revenues. The Bond Resolution creates and establishes as a sub- fund of the Trust Fund the "Miami Beach Redevelopment Agency Sinking Fund" (hereinafter referred to as the "Sinking Fund"). Also created are four (4) separate accounts in the Sinking Fund to be known as the "Interest Account," the "Principal Account," the "Bond Redemption Account" and the -Debt Service Reserve Account." The Sinking Fund and the accounts therein will be held and administered by the Trustee. All Tax Increment Revenues received by the Agency from the City or the County on deposit in the Trust Fund will be disposed of by the Agency only in the following manner: (1) Tax Increment Revenues will first be used, to the full extent necessary, for deposit with the Trustee into the Interest Account in the the Sinking Fund, immediately upon receipt of such Trust Fund Revenues, of such sums as will be sufficient to pay the interest becoming due on the Bonds during such calendar year; provided, however, that such deposit for interest will not be required to be made into the Interest Account to the extent that money on deposit therein is sufficient for such purpose and, provided further, that in the event the Agency has issued additional parity Variable Rate Bonds pursuant to the provisions of the Bond Resolution, Tax Increment Revenues will be deposited at C-7 !'j8 such other or additional times and amounts as necessary to pay the interest becoming due on the Variable Rate Bonds during such calendar year, all In the manner provided in the supplemental resolution authorizing such additional parity Variable Rate Bonds or in a resolution determining the details of Variable Rate Bonds that have been authorized but unissued. The Trustee will, on each Interest Payment Date, transfer to the Paying Agent moneys in an amount equal to the interest due on such Interest Payment Date or wil) advise the Paying Agent of the amount of any deficiency in the amount so transferred so that the Paying Agent may give appropriate notice required to provide for the payment of such deficiency from any Reserve Account Insurance Policy or Reserve Account Letter of Credit on deposit in the Debt Service Reserve Account. (2) (a) Tax Increment Revenues will next be used, to the full extent necessary, for deposit with the Trustee in the Principal Account in the Sinking Fund, immediately upon receipt of such Tax Increment Revenues of such sums as will be sufficient to pay the principal amount ofScrial Bonds which will mature during such calendar year: provided, however, that such deposit for principal will not be required to be made into the Principal Account to the extent that money on deposit therein is sufficient for such purpose. The Trustee will, on the business day prior to each principal payment date, transfer to the Paying Agent moneys in an amount equal to the principal due on such principal payment date or will advise the Paying Agent of the amount of any deficiency in the amount so transferred so that the Paying Agent may give appropriate notice required to provide for the payment of such deficiency from any Reserve Account Insurance Policy or Reserve Account Letter of Credit on deposit in the Debt Service Reserve Account. (bl Tax Increment Revenues will next be used, to the full extent necessary, for deposit with the Trustee into the Bond Redemption Account in the Sinking Fund immediately upon receipt of such Tax Increment Revenues, of such Amortization Requirements as may be required for the payment of the Term Bonds payable from the Bond Redemption Account, during such calendar year. The moneys in the Bond Redemption Account will be used solely for the purchase or redemption of the Term Bonds payable therefrom. The Agency may at any time purchase any of such Term Bonds at prices not greater than the then redemption price of such Term Bonds. If the Term Bonds are not then redeemable, the Agency may purchase such Term Bonds at prices not greater than the redemption price of such Term Bonds on the next ensuing redemption date. The Agency will be mandatorily obligated to use any moneys in the Bond Redemption Account for the redemption prior to maturity of such Term Bonds at such times as the same are subject to mandatory redemption. If, by the application of moneys in the Bond Redemption Account, the Agency will purchase or call for redemption in any year Term Bonds in excess of the Amortization Requirements for such year, such excess of Term Bonds so purchased or redeemed will be credited in such manner and at such times as the Executive Director determines over the remaining payment dates. No distinction or preference will exist in the use of the moneys on deposit in the Trust Fund for payment into the Interest Account, the Principal Account and the Bond Redemption Account, such accounts being on a parity with each other as to payment from the Trust Fund. (3) Tax Increment Revenues will next be used, to the full extent necessary, for deposit with the Trustee into the Debt Service Reserve Account immediately upon receipt of such Tax Increment Revenues of the difference between the amount on deposit in the Debt Service Reserve Account (including any Reserve Account Insurance Policy or C-8 un CJ,..1 Reserve Account Letter of Credit) and the Reserve Account Requirement for the Bonds Outstanding, and, provided, further, that no payments will be required to be made into the Debt Service Reserve Account whenever and as long as the amount deposiwd therein (including any Reserve Account Insurance Policy or Reserve Account Letter of Credit) equals the Reserve Account Requirement for the Bonds Outstanding. Notwithstanding the foregoing provisions, in lieu of or in substitute for the required deposits of Tax Increment Revenues (including existing deposits of Tax Increment Revenues) into the Debt Service Reserve Account, the Agency may cause to be deposited into the Debt Service Reserve Account a Reserve Account Insurance Policy or a Reserve Account Letter of Credit for the benefit of the holders of the Bonds Outstanding in an amount equal to the difference between the Reserve Account Requirement for the Bonds Outstanding and the sums then on deposit in the Debt Service Reserve Account, if any, which Reserve Account Insurance Policy or Reserve Account Letter of Credit will be payable or available to be drawn upon, as the case may be, (upon the giving of notice as required thereunder) on any Interest Payment Date on which a deficiency exis~'i which c~nn(01 be cured by moneys in any other fund or account held pursuant to the Hond Resolution and available for such purpose. If a disbursement is made under the Reserve Account Insurance Policy or the Reserve Account Letter of Credit, the Agency will be obligated to either reinstate the maximum limits of such Reserve Account Insurance Policy or Reserve Account Letter of Credit immediately following such disbursement or to deposit into the Debt Service Reserve Account from the Tax Increment Revenues, as provided in the Bond Resolution, funds in the amount of the disbursements made under such Reserve Account Insurance Policy or Reserve Account Letter of Credit, or a combination of such alternatives as will equal the Reserve Account Requirement for the Bonds Outstanding. Moneys in the Debt Service Reserve Account will be used only for the purpose of making payments of principal of and interest on the Bonds when the moneys in the Trust Fund or any other fund or account held pursuant to the Bond Resolution and available for such purpose are insufficient therefor. Any moneys in the Debt Service Reserve Account in excess of the Reserve Account Requirement for the Bonds Outstanding may, in the discretion of the Agency, be transferred to and deposited in the Interest Account, the Principal Account or the Bond Redemption Account as the Agency at its option may determine. The Debt Service Reserve Account will be valued at least once in each Fiscal Year and the value of securities on deposit therein will be the lower of par, or if purchased at other than par, amortized value. Amortized value, when used with respect to securities purchased at a premium above or a discount below par, will mean the value at any given date obtained by dividing the total premium or discount at which such securities were purchased by the number of interest payment dates remaining to maturity on such securities after such purchase and by multiplying the amount so calculated by the number of interest payment dates ha ving passed since the date of purchase; and (i) in the case of securities purchased at a premium, by deducting the product thus obtained from the purchase price, and (ii) in the case of securities purchased at a discount, by adding the product thus obtained to the purchase price. (4) Tax Increment Revenues will next be used for the payment of any subordinated obligations hereafter issued by the Agency in accordance with Lhe Bond Resolution, which subordinate obligations will have such lien on the Tax Increment Revenues as the Agency determines in the proceedings authorizing the issuance of such subordinated obligations. C-9 ,,- 90 (5) Thereafter, the balance of any Tax Increment Rpvenues remaining in the Trust Fund will, subject to the lax covenants of the Agency under the B(}nd Resolution, bl' used by the Agency for any lawful purposes. provided, however, that none of such Tax Increment Revenues will ever be used for the purposes provided in this paragraph (5) unless all payments required in paragraphs (I) through (41 above, including any deficiencies for prior payments and any amounts dues to the issuer of any Reserve Account Insurance Policy or Reserve Account Leller of Credit, have been made in ful1to the date of such use. Notwithstanding the foregoing or any other provision in the Bond Resolution to the contrary, failure to make the scheduled payments specified therein wil1 not constitute a breach of the Agency's obligations under the Bond Resolution so long as, on the date that any interest or principal payment is due on the Bonds, monies sufficient to make such payment are on deposit in the Interest Account or Principal Account or the Bond Redemption Account, as the case may be. Notwithstanding the foregoing or any other provision in the Bond Resolution to the contrary, if an). alIlount applied to the paymentofprincipal of and premium, Ifany, and interest on the Bonds that would have been paid from an account in the Sinking Fund, is paid instead under a Credit Facility or a Liquidity Facility, amounts deposited in such relevant account may be paid, to the extent required, to the issuer of the Credit Facility or Liquidity Facility, having therefore made said corresponding payment. E. Rebate Fund There is created and established under the Bond Resolution, the "Rebate Fund" which fund will be maintained with the Trustee separate and apart from all other funds and accounts of the Trustee or the Agency. Notwithstanding anything in the Bond Resolution to the contrary, the Agency will transfer or cause to be transferred the amounts required to be transferred in order to comply with the arbitrage rebate covenants contained in a certificate to be executed and delivered by the Agency in connection with the issuance of each Series of Bonds. The Agency will make or cause to be made payments from the Rebate Fund of amounts required to be deposited therein to the lJnited States of America in the amounts and at the times required by such arbitrage rebate covenants. The Agency covenants for the benefit of the Bondholders that it will comply with the requirements of the arbitrage rebate covenants. There will be excluded from the pledge and lien of the Bond Resolution the Rebate Fund, together with all moneys and securities from time to time held therein and all investment earnings derived therefrom. The Agency will not be required to comply with the requirements of this section in the event that the Agency obtains an opinion of nationally recognized bond counsel that (i) such compliance is not required in order to maintain the exclusion from gross income for Federal income tax purposes of interest on the Bonds and/or (ii) compliance with some other requirement is necessary to maintain the exclusion from gross income for Federal income tax purposes of interest on the Bonds. F. Investment of Funds. The Trust Fund, the Sinking Fund, including the Interest Account, Principal Account, Bond Redemption Account and Debt Service Reserve Account and the Cost of Issuance Fund and all other special funds (other than the Rebate Fund) created and established by the Bond Resolution will constitute trust funds in favor of the Bondholders and will be invested at the direction of the Agency as provided in this section. Moneys on deposit in the Trust Fund, Interest Account, Principal Account, Bond Redemption Account and Cost oflssuance Fund may be invested in Permitted Investments maturing not later than the dates on which such moneys will be needed for the purposes of such fund or account. Moneys on deposit in the Debt Service Reserve Account may be invested in Permitted Investments maturing not later than the final maturity of any of the Bonds. All income and earnings received from the investment and reinvestment of moneys in the Interest Account, the Principal Account and the Bond Redemption Account in the Sinking Fund will be C-IO 9:1 rewined in the respective accounts and applied as a credit a~uinst the obligation of the Agency to transfer moneys from the Trust Fund to such accounts pursuant to the Bond Resolution. All income and earnings received from the investment and reinvestment of moneys in the Debt Service Reserve Account in the Sinking Fund will be retained in the Debt Service Reserve Account and applied as a credit against the obligation of the Agency to transfer moneys from the Trust Fund to such account, unless the amount in such account exceeds the Reserve Account Requirement, in which event such excess may be applied in the manner set forth for excess amounts in the Debt Service Reserve Account, as described in the Bond Resolution. All income and earnings received from the investment and reinvestment of moneys in the Cost of Issuance Fund will be transferred to the Trust Fund. For the purpose of investing or reinvesting, the Agency and Trustee may commingle moneys in the funds and accounts created and established under the Bond Resolution (other than the Rebate Fund) in order to achieve greater investment income; provided that the Agency and Trustee will separately account for the amounts so commingled. The amounts required to be accounted for in each of the funds and accounts designated in the Bond Resol utian (other than the Rebate Fund) may be deposited in a single bank account provided that adequate accounting procedures are maintained to reflect and control the restricted allocations of the amounts on deposit therein for the various purposes of such funds and accounts as provided in the Bond Resolution. G. Issuance of Other Obligations Payable out of Trust Fund Revenues. Except upon the conditions and in the manner provided in the Bond Resolution, the Agency will not issue any other obligations payable from the Pledged Funds, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or any other charge having priority to or being on a parity with the lien of the Bonds issued pursuant to the Bond Resolution and the interest thereon, upon any of the Pledged Funds; provided that the Agency may enter into agreements with issuers of Credit Facilities and Liquidity Facilities which involve liens on Tax Increment Revenues on a parity with that of the Series of Bonds or portion thereof which is supported by such Credit Facilities or Liquidity Facilities. Any other obligations, in addition to the Bonds authorized by the Bond Resolution or additional parity Bonds issued under the terms, restrictions and conditions contained in the Bond Resolution, will provide that such obligations are junior, inferior and subordinate in al1 respects to the Bonds issued pursuant to the Bond Resolution as to lien on and source and security for payment from the Tax Increment Revenues and in al1 other respects. Nothing in the Bond Resolution will be deemed to prohibit the Agency from entering into currency swaps or other arrangements for pledging interest rates on any indebtedness. H. Issuance of Additional Parity Bonds. No additional parity Bonds, payable on a parity with Bonds issued pursuant to the Bond Resolution out of Pledged Funds will be issued after the issuance of an)" Bonds pursuant to the Bond Resolution unless the fol1owing, among other conditions, are complied with: (1) The Agency must be current in all deposits into the various funds and accounts and al1 payments theretofore required to have been deposited or made by it under the provisions of the Bond Resolution and the Agency must be currently in compliance with the covenants and provisions of the Bond Resolution and any supplemental resolution hereafter adopted for the issuance of additional parity Bonds; unless upon the issuance of such additional parity Bonds the Agency will be in compliance with all such covenants and provisions. (2) The amount of the Tax Increment Revenues during the immediately preceding Fiscal Year or any twelve (12) consecutive months selected by the Agency of the eighteen (18) months immediately preceding the issuance of said additional parity Bonds, as certified by an independent certified public accountant, were at least equal to one hundred twenty-five percent (125%) of the Maximum Annual Debt Service on (1) the C-ll \ \ ~J2 Bonds originally issued pursuant to the Bond Resolution and then Outstanding, (2) any additionul purity Honds therdofore issued and then Outstanding, and (3) the additional parity Bonds then proposed to be issued. (3) The Agency need not comply with subparagraph (2) above in the issuance of additional parity Bonds if and to the extent the Bonds to be issued are refunding Bonds, that is, delivered in lieu of or in substitution for Bonds originally issued under the Bond Resolution or previously issued additional parity Bonds, if the Agency causes to be delivered a certificate of the Executive Director of the Agency selling forth (i) the Maximum Annual Debt Service (A) with respect to the Bonds of all Series Outstanding immediately prior to the date of authentication and delivery of such refunding Bonds, and (8) with respect 10 the Bonds of all Series to be Outstanding immediately thereafter, and (ij) that the Maximum Annual Debt Service set forth pursuant to (8) above is no greater than that set forth pursuant to (A) above. Simultaneously with the delivery of any Bonds issued pursuant to Sections (2) and (3) above for the purpose of refunding any Bonds issueci under the Bone Rc::olution, the Agency may withdnm f,'om the Sinking Fund amounts theretofore deposited which are allocable to the Bonds being refunded and will transfer such amounts in accordance with the resolution providing for the issuance of the refunding Bonds, provided that after such withdrawal the Agency will be in compliance with the provisions of the Bond Resolution. The term "additional parity Bonds" as used in the Bond Resolution will be deemed to mean additional obligations evidenced by Bonds issued upon the provisions and within the limitations of this subsection to finance Redevelopment Projects payable from the Pledged Funds on a parity with Bonds originally authorized and issued pursuant to the Bond Resolution. Such Bonds will be deemed to have been issued pursuant to the Bond Resolution the same as the Bonds originally authorized and issued pursuant to the Bond Resolution and all of the covenants and other provisions of the Bond Resolution (except as to details of such Bonds evidencing such additional parity obligations inconsistent therewith), will be for the equal benefit, protection and security of the holders of any Bonds originally authorized and issued pursuant to the Bond Resolution and the holders of any Bonds evidencing additional obligations subsequently issued within the limitations of and in compliance with this subsection. All of such Bonds, regardless of the time or times of their issuance will rank equally with respect to their lien on the Pledged Funds and their sources and security for payment therefrom without preference of any Bonds over any other. The term "additional parity Bonds" as used in the Bond Resolution will not be deemed to include bonds, notes, certificates or other obligations subsequently issued in accordance with the Bond Resolution, the lien of which on the Pledged Funds is subject to the prior and superior lien on the Pledged Funds of Bonds and the Agency will not issue any obligations whatsoever payable from the Pledged Funds, which rank equally as to lien and source and security for their payment from such Pledged Funds, with Bonds except in the manner and under the conditions provided in the Bond Resolution. I. Remedies. Any holder of Bonds issued under the provisions of the Bond Resolution or the Trustee acting for such Bondholders, may either at law or in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State, or granted and contained in the Bond Resolution, and may enforce and compel the performance of all duties required by the Bond Resolution or by any applicable statutes, including the Act, to be performed by the Agency or by any officer thereof. Nothing in the Bond Resolution, however, will be construed to grant any Holder of such Bonds any lien on any property of the Agency, except as provided in the Bond Resolution. No Holder of Bonds, however, will have any right in any manner whatever to affect adversely, or prejudice the security or the Bond Resolution or to express any right under the Bond Resolution except in the manner provided, and all proceedings at law or in equity will be instituted and maintained for the benefit of all Holders of Bonds. C-12 ~)3 The "older or /folders of Bonds in an aggregate principal amount of more than twenty per centum (2(,,"~) of Bonds issued under the Bond Resolution then Outstanding may by a duly executcd certificate in ""riting request the Trustee to represent such Bondholders in any legal proceedings for the enfurcemcnt and protection of the rights of such Bondholders. Such certificate must be executed by such Bondholders or their duly authorized attorneys or representatives, and must be filed in the office of the Executive Director. J. Enforcement of Collections. The Agency will diligently enforce and collect the Tax Increment Re\'cnucs and will take all steps, actions and proceedings for the enforcement and collection of such Tax Increment Revenues to the full extent permitted or authorized by applicable laws, including the Act. All such Tax Increment Revenues will, as collected, be held in trust to be applied as provided in the Bond Resolution and not otherwise. K. Dischar~e and Satisfaction of Bonds. The covenants, liens and pledges entered into, created or imposed pursuant to the Bond Resolution may be fully discharged and satisfied with respect to all or a portion of the Bonds in anyone or more oflhc following ways: (1) by paying the principal of and interest on such Bonds when the same become due and payable; or (2) by depositing in the Interest Account, the Principal Account and the Bond Redemption Account and/or in such other accounts which are irrevocably pledged to the payment of Bonds and the Agency may hereafter create and establish by resolution, certain moneys which together with other moneys lawfully available therefor, if any, will be sufficient at the time of such deposit to pay when due the principal, redemption premium, if any, and interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof; or (3) by (al depositing in the Interest Account, the Principal Account and the Bond Redemption Account and/or such other accounts which are irrevocably pledged to the payment of Bonds as the Agency may hereafter create and establish by resolution, moneys which together with other moneys lawfully available therefor when invested in such Defeasance Obligations which are subject to redemption prior to their maturity other than at the option of the holder thereof, will provide moneys which will be sufficient to pay when due the principal, redemption premium if any, and interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof. Upon such payment or deposit in the amount and manner provided, Bonds will be deemed to be paid and will no longer be deemed to be Outstanding for the purposes of the Bond Resolution and all liability of the Agency with respect to said Bonds will cease, terminate and be completely discharged and extinguished, and the Holders thereof will be entitled for payment solely out of the moneys or securities so deposited; provided that in the event said Bonds do not mature and are not to be redeemed within the next succeeding sixty (60) days, the Agency will have given the Registrar irrevocable instructions to give, as soon as practicable, a notice to the Holders of said Bonds by first- class mail, postage prepaid, stating that the deposit of said moneys or Defeasance Obligations has been made with an appropriate fiduciary institution acting as escrow agent solely for the Holders of said Bond and other Bonds being defeased, and that said Bonds are deemed to have been paid in accordance with this section and stating such maturity or redemption date upon which moneys are to be available for the payment of the principal of and premium, if any, and interest on said Bonds. (4) As to Variable Rate Bonds, whether discharged and satisfied under the provisions of subsection (I), (2) or (3) above, the amoun t required for the interest thereon will be calculated at the maximum rate permitted by the terms of the provisions which authorized the issuance of such Variable Rate Bonds; provided however, that if on any C-13 9'1 date, as a result of such Variable Hate Bonds having borne interest at less than such maximum rate for any period, the total amount of moneys and Defeasance Obligations on deposit for the payment of interest on such Variable Rate Bonds is in excess of the total amount which would have been required t.o be deposited on such date in respect of such Variable Rate Bonds in order to fully discharge and satisfy such Bonds pursuant to the provisions of this Section, the Agency may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment securing said Variable Rate Bonds or otherwise existing under the Bond Resolution. (5) Notwithstanding any of the provisions of the Bond Resolution to the contrary, Put Bonds and Extendible Maturity Bonds may only be fully discharged and satisfied either pursuant to subsection (1) above or by depositing in the Interest Account, the Principal Account and the Bond Redemption Account, or in such other accounts which are irrevocably pledged to the payment of the Put Bonds as the Agency may hereafter create and establish by resolution, moneys which together with moneys lawfully available therefor, if any, will be sufficient at the time of such deposit to pay when due th~ maximum amount of principal of and redemption premium, if any, and interest on such Put Bonds and Extendible Maturity Bonds which could become payable to the Holders of such Bonds upon the exercise of any options provided to the Holders of such Bonds; provided however, that if, at the time a deposit is made pursuant to this subsection (5), the options originally exercisable by the Holder of a Put Bond are no longer exercisable, such Bond will not be considered a Put Bond and Extendible Maturity Bond for purposes of this subsection (5). (6) Notwithstanding the foregoing, all references to the discharge and satisfaction of Bonds will include the discharge and sa lisfaction of any issue of Bonds, any portion of an issue of Bonds, any maturity or maturities of an issue of Bonds, any portion of a maturity of an issue of Bonds or any combination thereof, provided that the provisions of this subsection (6) will not affect the requirements regarding Put Bonds and Extendible Maturity Bonds set forth in subsection (5). In the event that the principal and redemption price, if applicable, and interest due on the Bonds will be paid by the issuer of a Credit Facility or Liquidity Facility pursuant to the terms thereof, the assignment and pledge created hereunder and all covenants, agreements and other obligations of the Agency to the Bondholders will continue to exist and the issuer of such Credit Facility or Liquidity Facility will be subrogated to the rights of such Bondholders. (7) If any portion of the moneys deposited for the payment of the principal of and redemption premium, if any, and interest on any portion of Bonds is not required for such purpose, the Agency may use the amount of such excess free and clear of any trust, lien, security interest, pledge or assignment securing said Bonds or otherwise existing under the Bond Resolution. Modification or Amendment. Except as otherwise provided in the second paragraph below, no adverse material modification or amendment of the Bond Resolution, or of any resolution amendatory hereof or supplemental hereto, may be made without the consent in writing of (i) the Holders of more than ruty per centum (50%) in aggregate principal amount of the Bonds then Outstanding or (ii) in case less than all of the several Series of Bonds then Outstanding are affected by the modification or amendment, the Holders of more than nfty per centum (50%) in aggregate principal amount of the Bonds of each Series so affected and Outstanding at the time such consent is given; provided, however, that no modification or amendment may permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon, or affecting the promise of the Agency to pay the principal of and interest on the Bonds, as the same C-14 t , \ , " ~}5 mature or become due, from the Pledged Funds, or reduce the pcrcenl.c1gc of Holders of Bonds required above for such modification or amendment, without the consent of the Holders of all the Bonds. For the purposes of this section, to the extent any Series of Bonds is secured by a Credit Facility or Liquidity Facility, then the consent of the issuer of the Credit Facility or Liquidity Facility will constitute the consent of the Holders of such Series. The Bond Resolution may be amended, changed, modified and altered without the consent of the Holders of Bonds or any Credit Facility or Liquidity Facility: (a) to cure any ambiguity or formal defect or omission in the Bond Resolution or in any supplemental resolutions or to correct or supplement any provision contained in the Bond Resolution which may be defective or inconsistent with any other provisions contained therein; or (b) to grant to or confer upon the Bondholders any additional rights, remedies, powers, authority or security that may lawfully be granted to or conferred upon the Bondholders; or (c) to add to the conditions, limitations and restrictions on the issuance of Bonds under the provisions of the Bond Resolution, other conditions, limitations and restrictions to be observed; or (d) to add to the covenants and agreements of the Agency in the Bond Resolution other C0\Cnants and agreements thereafter to be observed by the Agency or to surrender any right or power re,;.erved to or conferred upon the Agency; or (e) to permit the issuance of Bonds, the interest on which is intended to be excludible from gross income for Federal income tax purposes under the Code to the Holders thereof in coupon form, if as a condition precedent to the adoption of such supplemental resolution, there is delivered to the Agency an opinion of counsel of recognized standing relating to municipal bonds to the effect that the issuance of Bonds in coupon form is then permitted by law and that the issuance of such Bonds in coupon form would not cause interest on such Bonds to be included in gross income for Federal income tax purposes under the Code to the Holders thereof; or (1) to permit the Agency to issue Bonds the interest on which is not excludible from gross income for Federal income tax purposes under the Code to the Holders thereof; or (g) to qualify the Bonds or any of the Bonds for registration under the Securities Act of] 933, as amended, or the Securities Exchange Act of 1934, as amended; or (h) to qualify the Bond Resolution as an "indenture" under the Trust Indenture Act of 1939, as amended; or (i) to make such changes as may be necessary to adjust the terms of the Bond Resolution so as to facilitate the issuance of Variable Rate Bonds, Capital Appreciation Bonds, Capital Appreciation and Income Bonds, Put Bonds, Extendible Maturity Bonds, Balloon Bonds, Interim Bonds and such other Bonds as may be marketable from time to time; or (j) to permit Bonds to be issued in book entry form with or without physical bonds; or (k) to make such changes as may be necessary to comply with the provisions of the Code relating to the exclusion of interest on the Bonds from gross income; or (I) to make such changes as may evidence the right and interest under the Bond Resolution of an issuer of a Credit Facility or a Liquidity Facility that secures any Series of Bonds. C-15 ~6 APPENDIX 0 [FORM OF OPINION OF BOND COUNSEL] , 1989 Miami Beach Redevelopment Agency Miami Beach, Florida Ladies and Gentlemen: We have examined the Constitution and laws of the St~t€ of Flor ida, part icu1ar ly the Flor ida Communi ty Redevelopment Act, codified as Chapter l63, Part III, Florida Statutes, as amended, tr.e Code of the City of Miami Beach, Florida (the "City") and the Code of Metropolitan Dade County, Florida (the "County"), each as amended (collectively, the "Act"), and Resolution No. (the "Resolution") adopted by the Commission (the "Commission") or the Miami Beach Redevelopment Agency (the "Agency") and other proofs submitted, relative to the issuance and sale of $ Miami Beach Redevelopment Agency Tax Increment Revenue Bonds Series 1989 issued on the date hereof (the "Bonds") and matur ing in such amounts and at such times, bearing interest and subject to re- demption, all as described in the Private Placement Memorandum of tr.e Agency, dated 1989, delivered in connection with the issuance of the BondS: The Bonds are being issued to f:nance the acquisition and clearing of certain property and the construction of certain related public improvements in the City (the "Project"). As to questions of fact material to our opinion, we have relied upon such certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent, investigation. We have also examined one of said Bonds as executed and authenticated. We assume that all other Bonds have been simi- larly executed and authenticated. D-l . , \ ~~'7 ~iami Beach Redevelopment Agency , 1989 Page 2 Based on the foregoing, we are of the opinion that: 1. Such proceedings and proofs show lawful authority for the issuance and sale of the Bonds by the Agency pursuant to the Act. 2. The Resolution has been duly adopted by the Commission and constitutes a legal, valid and binding obligation of the Agency. 3. The Bonds have been duly authorized, executed and delivered under the provisions of the Resolution to finance the Project. 4. The Bonds are legal, valid and binding special obliga- tions of the Agency payable solely from the funds pledged there- for under the Resolution. The Agency has covenanted in the Reso- lution to deposit into a redevelopment trust fund established pursuant to the Act all revenues required to be paid to the Agency by the County and the City under the Act (the "Trust Fund Revenues") as the same are recei ved and has pledged the Trust Fund Revenues (to the extent set forth in the Resolution) and all moneys, securities and instruments held in the funds and accounts established under the Resolution (other than the Rebate Fund) to the payment of the principal of, interest and premium, if any, on the Bonds. The full faith and credit of the Agency, the City or the County is not pledged to the payment of the pr incipal of, interest and premium, if any, on the Bonds and neither the Agency, the City nor the County is obligated to levy any taxes for the payment thereof. 5. Under existing statutes, regulations, rulings and court decisions, subject to the assumption stated below, interest on the Bonds is excluded from gross income for federal income tax purposes, except for interest on any Bond for any period during which such Bond is held by a "substantial user" of the Project or a "related person" within the meaning of Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code"). However, interest on the Bonds is an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations. We express no opinion regarding other federal tax consequences resulting from the ownership of, receipt or accrual of interest on, or disposition of the Bonds. In rendering the opinion contained in this paragraph 5, we have assumed continuing compliance with the requirements of the Code that must be met after the issuance of the Bonds in order that interest on the D-2 ~'t' Miami Beach Redevelopment Agency , 1989 Page 3 Bonds not be included in gross income for federal income tax purposes. The Agency I s failure to meet such requirements may cause interest on the Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Bonds. The Agency has covenanted in the Re&olution to comply with the requirements of the Code in order to maintain the exclusion of the interest on the Bonds from gross income for federal income tax purposes. 6. The Bonds and the interest thereon are exemp'i from taxation under the laws of the State of Flor ida, except ],s to estate taxes and taxes imposed by Chapter 220, Florida Stat~tes, on interest, income or profits on debt obligations owned by cor- porations, as defined in said Chapter 220, Florida Statutes. It is to be understood that the rights of the holders of the Bonds and the enforceability thereof and of the Resolution may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights heretofore or hereinafter enacted and that their enforcement may be subject to the exercise of judicial discretion in accordance wi th general principles of equity. Respectfully submitted, D-3 ~J~) MIAMI BEACH REDEVELOPMENT AGENCY $6,000,000* TAX INCREMENT REVENUE BONDS, SERIES 1989 PRIVATE PLACEMENT AGREEMENT Board of Commissioners Miami Beach Redevelopment Agency Miami Beach, Florida July 1989 Dear Commission Members: The undersigned, Chase Securities, Inc, (the "Representative"), on behalf of itself, Lazard Freres & Co. and PaineWebber Incorporated (collectively with the Representative, the "Placement Agents"), hereby agree to serve as the exclusive Placement Agents for Miami Beach Redevelopment Agency (the "Agency") in connection with the sale to qualified purchasers of the Agency's Tax Increment Revenue Bonds, Series 1989 (the "Bonds"). Subject to the performance by the Agency of its obligations under this Private Placement Agreement (the "Placement Agreement"), the completeness and accuracy of the representations, warranties and covenants of the Agency hereunder and the other conditions contained herein, the Placement Agents hereby accept such agency and agree, upon the terms and conditions herein set forth, to use our collective best efforts during the Offering Period (as herein defined) to find qualified purchasers for the Bonds upon the terms and subject to the conditions set forth herein. The financial disclosure letter, together with any and all necessary exhibits and attachments thereto, required to be provided to the Agency pursuant to Section 218.385, Florida Statutes, will be delivered to the Agency by the Representative at the time of the execution of the Commitment Letter, as defined herein and the form of which is attached hereto as Exhibit A. All terms used herein as defined terms and not otherwise defined shall have the meanings set forth in the Preliminary Private Placement Memorandum of the Agency with respect to the Bonds dated July __, 1989 (the "Preliminary Placement Memorandum"). The Agency hereby approves the use and the distribution by the Placement Agents of the Preliminary Placement Memorandum. l. Method of Offering. (a) Offerin~ Period. The offering period (the "Offering Period") shall begin on the date hereof and shall continue until the close of business on July __, 1989; provided, that the Agency and the Placement Agents may agree to extend the Offering Period to a later date. In any event, the agency of the Placement Agents shall continue through, but shall terminate upon, the Closing as defined in Section 5 herein. (b) Conduct of Offering. The Placement Agents shall offer the Bonds for sale, or solicit offers to buy the Bonds, or otherwise negotiate with any person with respect to any of the Bonds subject to any and all applicable requirements of the laws of the United States or of any state, including without limitation the State of Florida. * Estimated, subject to change. , i , ~, ,-. :; tlO (c) Investor Qualifications. The Bonds may be offered to investors who meet the requirements set forth in the Commitment Letter, the form of which is attached hereto as Exhibit A (the "Commitment Letter"). The form of the Commitment Letter is subject to modification by the Agency, with execution by the authorized official of the Agency to be and to be construed as conclusive approval of any and all such modifications. (d) Denominations. The Bonds may be offered in such denominations as are described in the Placement Memorandum, as defined herein. (e) Purchase Documentation. Each purchaser of the Bonds, having previously received a copy of the Preliminary Placement Memorandum, will be required to execute and deliver a Commitment Letter and shall receive the final Private Placement Memorandum (the "Placement Memorandum") as of the date of such execution. 2. Authority of the Reoresentative. Any and all authority, discretion or other power conferred upon the Placement Agents under any of the provisions of this Placement Agreement shall be executed by Chase Securities, Inc., as Representative of the Placement Agents, and all actions taken by the Representative shall be binding upon it and all other Placement Agents. The Representative represents that it is authorized to execute this Placement Agreement and to take any and all actions that may be required herein and on behalf of the Placement Agents. 3. Comoensation. As compensation for the services of the Placement Agents, the Agency shall pay to the Representative, for the benefit of the Placement Agents, an amount equal to % of the aggregate principal amount of the Bonds. Such payment shall be made on or before the Closing described in Section 5 herein. 4. Exoenses. The Agency shall payor cause to be paid all expenses incident to its obligations hereunder, including but not limited to (i) the costs of printing and distributing the Preliminary Placement Memorandum and the Placement Memorandum; (ii) the costs of the preparation, printing and delivery of the Bonds; (iii) the fees and disbursements of counsel, bond counsel, trustees, registrars and paying agents, financial advisors and any other experts, consultants or counsel retained by the Agency; and (iv) such other costs of issuance as may be mutually agreeable to the Agency and the Placement Agents. The Placement Agents shall pay any advertising or other solicitation expenses associated with the sale of the Bonds and other expenses incurred by them or any of them in connection with their placement of the Bonds, including the fees and disbursements of any counsel retained by them, except and to the extent that the Agency agrees to pay all or a portion of any such expenses. 5. Closing. On or before 12:00 noon, then-current New York time, on July , 1989, or at such other time or on such earlier or later date as the Representative and the Agency mutually agree upon (herein called the "Closing" or "Closing Date"), the Agency will deliver or cause to be delivered to the purchasers, at a location acceptable to the Placement Agents and the Agency, the Bonds in definitive registered bond form, duly executed by the Agency, as well as other documents herein mentioned. All of the Bonds are to be typewritten, printed or lithographed on steel engraved borders. It is anticipated that CUSIP identification numbers will be printed on the Bonds; however, the failure to print such numbers on any Bonds or any error with respect thereto shall not -2- 101 constitute cause for a failure or refusal by any purchaser to accept delivery of and payment for the Bonds in accordance with the terms of this Placement Agreement or the Commitment Letter. The purchasers will be required to accept such delivery and pay the purchase price of the Bonds (including accrued interest) in funds or by wire transfer, at the discretion of the Agency. The Bonds shall be in such denominations and registered in such names as the Representative shall request by written notice not later than five (5) business days prior to the Closing. 6. Reoresentations. Warranties and Agreements of the Agency. The Agency represents, warrants to and agrees with the Placement Agents as follows: (a) As of the date hereof, the Preliminary Placement Memorandum did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (b) As of its date and at all times subsequent thereto until and including the Closing Date, the final Placement Memorandum will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (c) The Agency is a political subdivision of the State of Florida, duly created and existing under and by virtue of the Constitution of the State of Florida, with full right, power and authority (i) to adopt the resolution pertaining to the authorization and issuance of the Bonds (the "Resolution"), (ii) to execute and deliver the Bonds, the Commitment Letter, this Placement Agreement, and the Placement Memorandum, (iii) to issue, sell, execute and deliver the Bonds, and (iv) to carry out, give effect to and consummate the transactions involving the Agency contemplated by the Resolution, the Commitment Letter, this Placement Agreement and the Placement Memorandum. (d) The Agency has the full right, power and authority to pledge the tax increment revenues pledged under the Resolution and described in the Placement Memorandum for the payment of the Bonds, and the Resolution creates a valid pledge of and lien and charge upon such tax increment revenues to the extent set forth in the Resolution and pursuant to Florida law. (e) The Agency has duly (i) adopted the Resolution; (ii) authorized the execution and delivery of the Commitment Letter, this Placement Agreement and the Placement Memorandum; (iii) authorized the issuance, sale, execution and delivery of the Bonds; and (iv) authorized and approved the performance by the Agency of its obligations contained in, and the taking of any and all actions as may be necessary to consummate the transactions contemplated by each of, such documents, and at the Closing Date, the Bonds, the Resolution, the Commitment Letter, this Placement Agreement and the Placement Memorandum will constitute valid, legal and binding obligations of the Agency enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws limiting creditors' rights. -3- J(J,~ (f) The adoption of the Resolution, the execution and delivery of the Bonds, the Commitment Letter and this Placement Agreement, and compliance with the provisions thereof and hereof, under the circumstances contemplated thereby and hereby, do not and will not conflict, to the best of the Agency's knowledge, with any applicable law or administrative rule or regulation of the State of Florida or the United States, or any department, division or agency thereof, or any applicable court or administrative decree or order, or any ordinance, resolution, indenture, deed of trust, mortgage, agreement or other instrument which the Agency has adopted or to which the Agency is a party. (g) Other than as described in the Preliminary Placement Memorandum or the Placement Memorandum, there is no action, suit, proceeding or investigation at law or in equity before or by any court, governmental agency, public board or body, pending or, to the best of the Agency's knowledge, threatened against or affecting the Agency, (i) to restrain or enjoin the issuance or delivery of any of the Bonds or the collection of tax increment revenues pledged for the payment of the Bonds under the Resolution; (ii) in any way contesting or affecting: the authority for the issuance of the Bonds; the validity or enforceability of the Bonds, the Resolution, the Commitment Letter or this Placement Agreement; or the power of the Agency to adopt the Resolution and to execute and deliver the Bonds, the Commitment Letter or this Placement Agreement, or to consummate the transactions relating to the Agency contemplated by the Resolution, the Commitment Letter, this Placement Agreement and the Placement Memorandum; (iii) in any way challenging the accuracy or completeness of the Commitment Letter, the Preliminary Placement Memorandum or the Placement Memorandum or the validity of any of the transactions described therein; or (iv) in any way contesting the existence or powers of the Agency or the Board of Commissioners of the Agency (the "Board") or the right to hold office of any member of the Board. (h) All proceedings of the Board relating to the adoption of the Resolution, the approval and authorization of the Commitment Letter, this Placement Agreement and the Preliminary Placement Memorandum and the Placement Memorandum, and the approval and authorization of the issuance and sale of the Bonds, were conducted at duly convened meetings of the Board, with respect to which all notices were duly given to the public and at which meetings quorums were at all material times present; and no authority or proceeding for the issuance of the Bonds has been repealed, rescinded or revoked. (i) The Agency will cooperate with the Placement Agents, at the reasonable request of the Representative and at the expense of the Placement Agents, in taking all necessary action for (i) the qualification of the Bonds for offer and sale under the "Blue Sky" or other securities laws and regulations of such states and other jurisdictions of the United States as the Representative may designate; (ii) the determination of the eligibility of the Bonds for investment under the laws of such jurisdictions as the Representative may designate; and (iii) the continuation of any such qualification in effect so long as required for the offering or distribution of the Bonds; provided, however, that the Agency may in its discretion, but -4- J03 shall not be required to, become subject to the service of process in any jurisdiction in which the Agency is not now subject to such service. (j) All approvals, consents and orders required to be obtained, and all action required to be taken, under federal, state and local laws, including without limitation the adoption of ordinances or resolutions approving the issuance and delivery of the Bonds and any other such approvals, consents, orders or actions required to be taken by or obtained from the City of Miami Beach (the "City") or Dade County, Florida (the "County"), or the State of Florida (the "State"), with respect to the adoption of the Resolution, the Commitment Letter, this Placement Agreement and the Preliminary Placement Memorandum and the Placement Memorandum by the Agency and the authorization, issuance, sale, execution and delivery of the Bonds, and prior to the performance by the Agency of its obligations under the Resolution, the Commitment Letter, and this Placement Agreement and the Bonds, have been so obtained or taken, except for such approvals, consents, orders or other actions as may be required under the securities laws of any state in connection with the offering and sale of the Bonds. (k) When delivered to and paid for by the purchasers at the Closing in accordance with the provisions of this Placement Agreement and the Resolution, the Bonds will have been duly authorized, executed, issued and delivered. None of the officers, members, agents or employees of the Agency shall be personally liable for the payment of any damages or for the performance of any obligation under this Placement Agreement. (l) The Agency will apply the proceeds of the Bonds in accordance with the Resolution and as contemplated by the Preliminary Placement Memorandum and the Placement Memorandum. (m) Any certificate signed by an authorized official or individual of the Agency shall be deemed as a representation and warranty by the Agency (and not by such individual) to the Placement Agents or to any purchaser of the Bonds as to the statements made therein. 7. Conditions to the Obli~ations of the Placement Agents. The obligations of the Placement Agents under this Placement Agreement to arrange for the delivery of and payment for the Bonds by the purchasers on the Closing Date shall be subject, at the option of the Placement Agents, (i) to the accuracy in all material respects of the representations and warranties on the part of the Agency contained herein as of the date hereof and as of the Closing Date, (ii) to the accuracy in all material respects of the statements of the officers and other officials of the Agency made in any certificates or other documents furnished pursuant to the provisions hereof, (iii) to the performance by the Agency of its obligations to be performed hereunder at or prior to the Closing Date and (iv) to the following additional conditions: (a) At the Closing Date, (i) this Placement Agreement, the Placement Memorandum, the Resolution and the Commitment Letter shall be in full force and effect and shall not have been amended, modified or supplemented in any material respect after the date hereof except as otherwise may have been agreed to in writing by the Representative and -5- J04 the Agency; (ii) each of the representations and warranties of the Agency contained in Section 6 of this Placement Agreement shall be true, complete and correct in all material respects as if then made; and (iii) the Agency shall have performed, or caused to have been performed, all obligations required to be performed under or specified in this Placement Agreement at or prior to the Closing. (b) At the Closing Date, the Placement Memorandum shall not have been amended, modified or supplemented, except as may have been agreed to in writing by the Placement Agents. (c) The marketability of the Bonds shall not have been materially adversely affected, in the reasonable judgment of the Placement Agents, by reason of any of the following occurring between the date hereof and the Closing Date: (i) legislation is enacted or is introduced by the Congress of the United States or adopted by either House thereof or favorably reported for passage to either House of the Congress by any committee of such House to which such legislation has been referred for consideration or is enacted or introduced by the Legislature of the State of Florida or adopted by either the House of Representatives or the Florida Senate or by any committee of such bodies to which such legislation has been referred for consideration, or is recommended to the Congress for passage by the President of the United States or the Chairman of either of the Committee on Finance of the United States Senate or the Committee on Ways and Means of the United States House of Representatives, or is recommended to the Florida Legislature for passage by the Governor of the State of Florida; or a decision is rendered by a court of the United States, including the Tax Court of the United States, or of the State of Florida, or a ruling or an official release is made or a regulation shall have been proposed or made by the Treasury Department of the United States or the Internal Revenue Service or other federal or State of Florida authority having jurisdiction over tax matters, with respect to federal or State of Florida taxation upon revenues or other income of the Agency or upon interest on obligations of the general character of the Bonds; or other action or events shall have transpired that would, in the reasonable judgment of the Placement Agents, have the purpose or effect, directly or indirectly, of changing the federal or State of Florida tax consequences of any of the transactions contemplated in connection herewith; or (ii) the occurrence of any event or the existence of any condition that, in the reasonable judgment of the Representative, either makes untrue or incorrect in any materially adverse respect any statement or information contained in the Placement Memorandum or is not reflected in the Placement Memorandum but should be reflected therein in order to make the statements and information contained in the Placement Memorandum not misleading in any material adverse respect; or -6- . I , \. , \ ,-' JOS (iii) the outbreak of any war or other national or international calamity or crisis, the effect of such outbreak, calamity or crisis on the financial markets of the United States being such as, in the reasonable opinion of the Placement Agents, would materially adversely affect the ability of the Placement Agents to arrange for the purchase of Bonds; or (iv) general suspension of trading on the New York Stock Exchange or minimum or maximum prices for trading shall have been fixed and be in force, or maximum ranges for prices for securities shall have been required and be in force on the New York Stock Exchange, whether by virtue of a determination by that Exchange or by order of the Securities and Exchange Commission or any other governmental authority having jurisdiction; or (v) the declaration of a general banking moratorium by either federal, Florida or New York authorities; or (vi) the enactment or proposal of legislation, or a decision by a court of the United States, or a ruling, regulation or proposed regulation by or on behalf of the Securities and Exchange Commission or other governmental agency having jurisdiction of the subject matter, that, in the opinion of counsel to the Placement Agents, has the effect of requiring the Bonds, or any securities of the Agency or any securities similar to the type contemplated herein, to be registered under the Securities Act of 1933, as amended, or under Florida law or requiring the Resolution to be qualified as an indenture under the Trust Indenture Act of 1939, as amended; or (vii) the issuance of a stop order, ruling, release, regulation or no action letter by or on behalf of the Securities and Exchange Commission or any other governmental agency having jurisdiction of the subject matter (which is beyond the control of the Placement Agents or the Agency to prevent or avoid) to the effect that the issuance, offering or sale of the Bonds, including all the underlying obligations as contemplated hereby or by the Placement Memorandum, or any document relating to the issuance, offering or sale of the Bonds is or would be in violation of any provision of the federal securities laws at Closing, including the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, or the Trust Indenture Act of 1939, as amended; or (viii) the occurrence, after the signing hereof, of any of the following: (a) a financial crisis affecting the creditworthiness of the Agency; (b) a default with respect to any outstanding debt obligations of the Agency which, in the reasonable opinion of the Placement Agents would materially adversely affect the ability of the Placement Agents, to arrange for the purchase of the Bonds; or (c) the institution -7- 106 of proceedings under the federal or State of Florida bankruptcy laws by or against the Agency. (d) At or prior to the Closing, notwithstanding the requirements of other parties, the Representative shall receive one copy of each of the following documents, certificates and opinions, each dated the date of the Closing unless otherwise specified and in form and substance satisfactory to both the Representative and co-counsel to the Placement Agents: (1) (A) the unqualified approving opinion of Bond Counsel with respect to the validity of the Bonds and the tax exempt nature thereof, substantially in the form attached to the Placement Memorandum as Appendix D; and (B) the supplemental opinion of Bond Counsel, addressed to the Agency, to the Placement Agents and to the purchasers, to the effect that (i) the Agency is duly organized and validly existing as a public body corporate and politic under the Constitution and the laws of the State of Florida, with full legal right, power and authority to issue the Bonds and to perform all of its obligations under the Placement Agreement, the Bonds, the Resolution and the Commitment Letter and the same are now in full force and effect; (ii) the Agency has duly authorized the execution and approved the distribution of the Placement Memorandum; (iii) the Placement Agreement and the Commitment Letter have each been duly authorized, executed and delivered by the Agency and, assuming due authorization, execution and delivery by the other parties thereto, constitute legal, valid and binding agreements of the Agency in accordance with their respective terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws limiting creditors' rights; (iv) no approval or other action is required by any governmental authority or agency in connection with the adoption of the Resolution or the approval or execution by the Agency of the Commitment Letter, the Placement Agreement or the Placement Memorandum, which has not already been obtained or taken, except that the offer and sale of the Bonds in certain jurisdictions may be subject to the provisions of the securities or "Blue Sky" laws of such jurisdiction; (v) any and all approvals or waivers required to be obtained from the State with respect to the Bonds and the interest rate thereon have been obtained, have not been rescinded and are in full force and effect; (vi) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Resolution is exempt from qualification as an indenture under the Trust Indenture Act of 1939, as amended; (vii) to the extent that the Resolution provides that the Bonds are payable from Tax Increment Revenues (as defined in the Placement Memorandum) of the Agency, the Resolution validly creates the irrevocable pledge it purports to create of such revenues and other funds pledged thereunder to the payment of principal of and interest on the Bonds, and the proceeds of the Agency's Tax -8- , l . \ , \ ,-' .... (l'.J J ' , Increment Revenues collected for the security and payment of the Bonds, except as provided in the Resolution, must be applied solely to the payment of the principal of, premium, if any, and interest on the Bonds; and (viii) the information and statements (except for any statistical information, as to which no opinion is given) contained in the Placement Memorandum under the headings "INTRODUCTION," "THE SERIES 1989 BONDS," REDEMPTION PROVISIONS," "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS" (other than the heading "TAX INCREMENT REVENUES -- Historical and Projected"), "TAX MATTERS" and "APPENDIX C -- SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION" are true and correct in all material respects. (2) The opinion of general counsel to the Agency to the effect that: (i) the Agency is duly organized and validly existing as a public body corporate and politic under the Constitution and the laws of the State of Florida; (ii) the Commitment Letter and the Placement Agreement have each been duly authorized, executed and delivered by the Agency; (iii) the Agency has duly adopted the Resolution and has approved, and duly executed, the Placement Memorandum; (iv) the adoption of the Resolution, the entry into the Commitment Letter and the Placement Agreement, and the approval and execution of the Placement Agreement by the Agency and compliance with the provisions thereof, under the circumstances contemplated thereby, do not and will not in any respect material to this transaction constitute on the part of the Agency a breach of or default under any ordinance, resolution, indenture, deed of trust, mortgage, agreement, or other instrument of which such counsel has knowledge and which the Agency has adopted or to which the Agency is a party, or, to such counsel's knowledge, does not materially conflict with, violate, or result in a breach of any existing law, public order or consent decree to which the Agency is subject; (v) other than as described in the Placement Memorandum, to the best of such counsel's knowledge, there is no action, suit, proceeding, or governmental investigation at law or in equity before or by any court, public board or body, pending or, to such counsel's knowledge, threatened against the Agency (a) to restrain or enjoin the issuance or delivery of any of the Bonds or the collection of tax increment revenues pledged to the payment of the Bonds under the Resolution, (b) in any way contesting or affecting: the authority for the issuance of the Bonds or the validity or enforceability of the Bonds, the Resolution or the Placement Agreement, or the power of the Agency to adopt the Resolution and to execute and deliver the Bonds, the Commitment Letter or the Placement Agreement, or to consummate the transactions relating to the Agency contemplated by the Resolution, the Placement Agreement and the Placement Memorandum, (c) in any way challenging the accuracy or completeness of the Placement Memorandum or the validity of any of the transactions described therein, or (d) in any way contesting the existence or power of the Agency or the Board or the title to any office of any member of the Board; and (vi) based on such counsel's review of the -9- , "8 -1 . J Placement Memorandum and without having undertaken to determine independently the accuracy and completeness of the statements contained in the Placement Memorandum, nothing has come to such counsel's attention that would lead such counsel to believe that the Placement Memorandum (except for financial and statistical data included therein the information contained under the caption "PRIVATE PLACEMENT," and the Projection Report set forth in Appendix A, as to which no view need be expressed) contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading, and without limiting the foregoing, such counsel confirms, as of the date of such opinion, the accuracy of the information set forth in the Placement Memorandum under the caption "LITIGATION." (3) The opinion or opinions of co-counsel to the Placement Agents, addressed to the Placement Agents, to the effect that (i) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Resolution is exempt from qualification as an indenture under the Trust Indenture Act of 1939, as amended; and (ii) based upon the examinations that they have made as co- counsel for the Placement Agents and their participation in certain meetings held in connection with the preparation of the Placement Memorandum, and without having undertaken to determine independently the accuracy or completeness of the statements contained in the Placement Memorandum, nothing has come to their attention that would lead them to believe that the Official Statement (except the economic, financial and statistical data included therein and except for Appendix A as to which no view is expressed) contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading. (4) A certificate of Hewitt, Olson, Smoker & Associates, Inc, (the "Feasibility Consultant"), to the effect that (i) the Feasibility Consultant consents to all references to it in the Placement Memorandum and to the use and inclusion in the Placement Memorandum of the tax increment revenue projection study (the "Projection Study") set forth therein as Appendix A and (ii) as of the date thereof, the Projection Report, with respect to the subject matter and the stated scope thereof, did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. (5) The Agency's certificate, signed by the Chairman of the Agency or his duly authorized designee and attested by the Secretary of the Agency, or such other authorized officials of the Agency acceptable to the Representative, and -10- 1\:9 in form and substance satisfactory to the Representative, to the effect that: (a) the representations of the Agency in the Placement Agreement are true and correct in all material respects as of the date of Closing; and (b) to the best of their knowledge and belief, the Placement Memorandum as of its date did not, and as of the date of Closing, does not, contain an untrue statement of a material fact or omit to state a material fact which should be included therein for the purpose for which the Placement Memorandum is to be used, or which is necessary to make the statements contained therein, in the light of the circumstances in which they were made, not misleading. (6) A certified copy of the Resolution. (7) A no-arbitrage certificate in substance and form satisfactory to Bond Counsel. (8) Such additional legal opinions, certificates, agreements, proceedings, instruments and other documents as the Representative or Bond Counsel may reasonably request at least five (5) business days before Closing to evidence compliance by the Agency with legal requirements, the truth and accuracy, as of the time of Closing, of the representations of the Agency contained in this Placement Agreement and due performance or satisfaction of the Agency, at or prior to such time, of all agreements then to be performed and all conditions then to be satisfied by the Agency. If there shall be failure to satisfy the conditions to the Placement Agents' obligations contained in this Placement Agreement or if such obligations shall be terminated for any reason permitted by this Placement Agreement, then, unless waived by the Placement Agents, this Placement Agreement shall terminate and the Placement Agents and the Agency shall have no further obligation thereunder. 8. Condition to the Obligations of the Agency. The obligations of the Agency to deliver the Bonds in accordance with Section 5 and otherwise perform under this Agreement shall be subject, at the option of the Agency, to the requirement that (i) prior to the Closing Date, a qualified purchaser or purchasers shall have executed one or more commitment letters for not less than one hundred percent (100%) of the aggregate principal amount of the Bonds and (ii) on the Closing Date, each such purchaser shall meet its obligations under its Commitment Letter to accept and pay in full the purchase price of all of the Bonds that such purchaser has agreed to purchase pursuant to its Commitment Letter. 9. Notices. Any notice or other communication to be given under this Placement Agreement may be given by delivering the same in writing as follows: -11- t , \ ~ J10 To the Agency: Miami Beach Redevelopment Agency City Hall 1700 Convention Center Drive Miami Beach, Florida 33139 Attn: Rob W. Parkins, Executive Director With a copy to: Arnold M. Weiner, General Counsel To the Placement Agents: Chase Securities, Inc. One Chase Manhattan Plaza Municipal Finance Division, 20th Floor New York, New York 10081 Attn: Kym Arnone 10. Parties in Interest. This Placement Agreement is made solely for the benefit of the Agency and the Placement Agents (including the successors or assigns of any of such parties) and no other person, partnership, association or corporation shall acquire or have any right hereunder or by virtue hereof. All representations and agreements of the Placements Agents and the Agency in this Placement Agreement shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any of the Placement Agents and shall survive the delivery of and payment of the Bonds. ll. Effective Date. This Placement Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the Agency and shall be valid and enforceable as of the time of such acceptance. 12. Execution in Counterparts. This Placement Agreement may be executed in several counterparts, each of which shall be regarded as an original and all of which shall constitute one and the same document. CHASE SECURITIES, INC. LAZARD FRERES & CO, PAINEWEBBER INCORPORATED as Placement Agents By: Chase Securities, Inc., as Representative Accepted June , 1989 MIAMI BEACH REDEVELOPMENT AGENCY By: , Chairman -12- 111 [FORM OF COMMITMENT LETTER] Miami Beach Redevelopment Agency Miami Beach, Florida Re: Miami Beach Redevelopment Agency Tax Increment Revenue Bonds. Series 1989 (the "Bonds") Gentlemen: The undersigned (the "Purchaser") hereby agrees to purchase $ aggregate principal amount of the Bonds described above, bearing interest at the rate of %, in accordance with the terms and conditions of the prIVate Placement Memorandum pertaining to the Bonds (the "Placement Memorandum"), which Placement Memorandum, in its preliminary form (the "Preliminary Placement Memorandum") has been reviewed by us. The purchase price of the Bonds will be $ , plus accrued interest thereon from July 1 until the date of delivery (the "Purchase Price"). It is our understanding that the Miami Beach Redevelopment Agency (the "Agency") proposes to close the sale of and deliver the Bonds on or before 12:00 noon, New York time, on July , 1989 (the "Closing Date"), at which time we will be prepared to pay the Purchase Price in full in funds, subject to the direction of the Agency and Chase Securities, Inc., acting as representative of the placement agents for the Bonds (the "Placement Agents"). We hereby represent and warrant to the Agency and to the Placement Agents, among other things, as follows: (a) The Bonds are being purchased by us for purposes of investment only, for our own account, and not with a view to, or the offer or sale in connection with, the distribution thereof, and we are not participating, directly or indirectly, in an underwriting of any such undertaking. (b) We will not take, or cause to be taken, any action that would cause us to be deemed an underwriter, as defined in section 2(11) of the Securities Act of 1933, as amended, of the Bonds. (c) We have received, read and reviewed a copy of the Preliminary Placement Memorandum. (d) We (and our representatives) have had an opportunity to ask questions of, and receive answers from, persons acting on behalf of the Agency in order to discuss and verify the accuracy and completeness of the information set forth in the Preliminary Placement Memorandum, including, without limitation, the report entitled "Projection of Tax Increment Revenues in the South pointe Redevelopment Area, Miami Beach, Florida, 1989 - 1993," set forth as Appendix A of the Preliminary Placement Memorandum. , i ) \ ,-" 1.12 (e) By reason of our business and experience in financial matters in general, and investments in particular, we are capable of evaluating the risks of an investment in the Bonds, and we are capable and prepared to bear the risks of any investment in the Bonds. (f) Our financial condition is such that we are under no present or contemplated future need to dispose of any portion of the Bonds to satisfy any existing or contemplated undertaking, need or indebtedness. (g) We acknowledge and agree that any obligation of the Agency to sell and deliver to us the Bonds which are the subject of this Commitment Letter shall be, at the option of the Agency, subject to the condition that the entire aggregate principal amount of the Bonds shall be sold and delivered by the Agency on the Closing Date. IN WITNESS WHEREOF, we have executed this Commitment Letter this ___ day of July, 1989. By: Printed: Title: ACKNOWLEDGMENT AND ACCEPTANCE The foregoing Commitment Letter is hereby acknowledged and accepted by the Miami Beach Redevelopment Agency this ___ day of July, 1989. MIAMI BEACH REDEVELOPMENT AGENCY By: Printed: Title: -2- 113