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HomeMy WebLinkAbout1988-044INDIAN RIVER COUNTY, FLORIDA RESOLUTION NO. 88-44 A RESOLUTION OF INDIAN RIVER COUNTY, FLORIDA PROVIDING FOR THE PURCHASE OF A SUBREGIONAL WATER TREATMENT AND DISTRIBUTION SYSTEM BY INDIAN RIVER COUNTY, FLORIDA; PROVIDING FOR THE ISSUANCE OF NOT EXCEEDING $4,000,000 WATER REVENUE BONDS, SERIES 1988, OF THE COUNTY TO PAY THE COST OF SAID SYSTEM; PROVIDING FOR THE RIGHTS OF THE REGISTERED OWNERS OF SAID BONDS; PROVIDING FOR THE PAYMENT THEREOF; MAKING CERTAIN OTHER COVENANTS AND AGREEMENTS IN CONNECTION WITH THE ISSUANCE OF SAID BONDS; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUNTY, FLORIDA: SECTION 1. AUTHORITY FOR THIS RESOLUTION. This resolution is adopted pursuant to Chapters 125 and 159, Florida Statutes (1987), and other applicable provisions of law. SECTION 2. DEFINITIONS. The following terms shall have the following meanings in this Resolution, unless the context otherwise clearly requires: A. "Act" shall mean Chapters 125 and 159, Florida Statutes (1987), and other applicable provisions of law. B. "Additional Parity Bonds" shall mean additional bonds issued in compliance with the terms, conditions and limitations contained herein which have an equal lien on the Pledged Funds, as herein defined, and rank equally in all respects with all other Bonds issued hereunder as to lien and security for payment. C. "Authorized Investments" shall mean those investments specified in Section 125.31, Florida Statutes (1987), as amended. D. "Board" shall mean the Board of County Commissioners of Indian River County, Florida. E. "Bonds" shall mean the Series 1988 Bonds together with any Additional Parity Bonds hereafter issued hereunder. F. "Bond Registrar" shall mean the Bond Registrar to be determined by subsequent resolution of the Board. INDIAN RIVER COUNTY, FLORIDA RESOLUTION NO. 88-44 A RESOLUTION OF INDIAN RIVER COUNTY, FLORIDA PROVIDING FOR THE PURCHASE OF A SUBREGIONAL WATER TREATMENT AND DISTRIBUTION SYSTEM BY INDIAN RIVER COUNTY, FLORIDA; PROVIDING FOR THE ISSUANCE OF NOT EXCEEDING $4,000,000 WATER REVENUE BONDS, SERIES 1988, OF THE COUNTY TO PAY THE COST OF SAID SYSTEM; PROVIDING FOR THE RIGHTS OF THE REGISTERED OWNERS OF SAID BONDS; PROVIDING FOR THE PAYMENT THEREOF; MAKING CERTAIN OTHER COVENANTS AND AGREEMENTS IN CONNECTION WITH THE ISSUANCE OF SAID BONDS; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUNTY, FLORIDA: SECTION 1. AUTHORITY FOR THIS RESOLUTION. This resolution is adopted pursuant to Chapters 125 and 159, Florida Statutes (1987), and other applicable provisions of law. SECTION 2. DEFINITIONS. The following terms shall have the following meanings in this Resolution, unless the context otherwise clearly requires: A. "Act" shall mean Chapters 125 and 159, Florida Statutes (1987), and other applicable provisions of law. B. "Additional Parity Bonds" shall mean additional bonds issued in compliance with the terms, conditions and limitations contained herein which have an equal lien on the Pledged Funds, as herein defined, and rank equally in all respects with all other Bonds issued hereunder as to lien and security for payment. C. "Authorized Investments" shall mean those investments specified in Section 125.31, Florida Statutes (1987), as amended. D. "Board" shall mean the Board of County Commissioners of Indian River County, Florida. E. "Bonds" shall mean the Series 1988 Bonds together with any Additional Parity Bonds hereafter issued hereunder. F. "Bond Registrar" shall mean the Bond Registrar to be determined by subsequent resolution of the Board. G. "Consulting Engineerst° shall mean such qualified and recognized consulting engineers, having a nationwide and favorable reputation for skill and experience in the construction and operation of systems such as the System at the time retained by the County to perform the acts and carry out the duties as herein provided for the Consulting Engineers. H. "County" shall mean Indian River County, Florida. I. "Federal Securities" shall mean direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, which are not redeemable prior to maturity at the option of the obligor. J. "Fiscal Year" shall mean the period beginning with and including October 1st of each year and ending with and including the next September 30th. K. "Paying Agent" shall mean the Paying Agent to be determined by subsequent resolution of the Board. L. "Pledged Funds" shall mean the Surcharges together with any other revenues and funds pledged in connection with the Bonds. M. "Record Date" shall mean the 15th day of the month immediately preceding an interest or other applicable payment date for the Bonds. N. "Registered Owner" or any similar term shall mean any person who shall be the owner of any outstanding Bond or Bonds as shown on the books of the County maintained by the Bond Registrar. O. "Series 1988 Bonds" shall mean the Water Revenue Bonds, Series 1988, authorized and issued hereunder. P. "Surcharges" shall mean the surcharges imposed by the County with regard to the System. Q. "System" shall mean the complete subregional wastewater treatment and distribution system authorized to be purchased hereunder, together with any and all improvements, extensions and additions thereto hereafter constructed or acquired, and any facilities hereafter made a part of the System by resolution of the Board together with any and all improvements, extensions and additions thereto thereafter constructed or acquired. Words importing singular number shall include the plural number and vice versa and words importing persons shall include firms and corporations or other entities and vice versa. 2 SECTION 3. FINDINGS. It is hereby found and determined as follows: A. It is necessary and desirable to purchase the System, as provided herein, in order to preserve and protect the public health, safety and welfare of the inhabitants of the County. B. It is anticipated that the Pledged Funds to be derived from the operation of the System will not be pledged or encumbered in any manner at the time of the issuance of the Series 1988 Bands. C. The estimated Pledged Funds will be sufficient to pay all of the principal of and interest on the Series 1988 Bonds, as the same become due, and to make all required sinking fund, reserve or other payments in connection therewith. D. It is in the best interest of the County to issue the Series 1988 Bonds. E. The principal of and interest on the Bonds and all required sinking fund, reserve and other payments in connection therewith shall be payable solely from the Pledged Funds. The County shall never be required to levy ad valorem taxes on any property therein to pay the principal of and interest on the Bonds or to make any of the required sinking fund, reserve or other payments in connection therewith and such obligations shall not constitute a lien upon any property of or in the County. SECTION 4. AUTHORIZATION OF PURCHASE OF SYSTEM. There is hereby authorized the purchase of the System pursuant to and as more fully described in the Purchase Agreement (the "Purchase Agreement") dated April 25, 1988 between the County and North Beach Water Company, a Florida corporation having the post office address P. O. Box 157, Wabasso, Florida 32970. The cost of the System, in addition to the cost of the items set forth in the Purchase Agreement, may include, but is not limited to, the cost of; engineering, legal and financing expenses; expenses for estimates of costs and of revenues; expenses for surveys; the fees of fiscal agents, financial advisors and consultants; administrative expenses relating solely to the purchase of the System; the capitalization of interest for a reasonable period after the issuance of the Series 1988 Bonds; the creation and establishment of reasonable reserves for debt service and operation and maintenance; the discount on the sale of the Series 1988 Bonds; and such other costs and expenses as may be necessary or incidental to the financing herein authorized and the purchase of the System and commencing the operation of the same. SECTION 5. RESOLUTION TO CONSTITUTE CONTRACT. In consideration of the acceptance of the Bonds by the Registered K Owners who shall hold the same from time to time, this Resolution shall be deemed to be and shall constitute a contract between the County and such Registered Owners. The covenants and agreements herein set forth to be performed by the County shall be for the equal benefit, protection and security of the Registered Owners of the Bonds, all of which Bonds shall be of equal rank and without preference, priority or distinction with respect to any other Bonds, except as expressly provided therein and herein. SECTION 6. AUTHORIZATION AND DESCRIPTION OF BONDS. Subject and pursuant to the provisions of this Resolution, obligations of the County to be known as "Water Revenue Bonds, Series 1988,1' are hereby authorized to be issued in the aggregate principal amount of not exceeding $4,000,000. The Series 1988 Bonds shall be dated as of a date to be fixed by subsequent resolution of the County and may be numbered consecutively from one upward or in such other manner as agreed upon between the County and the Bond Registrar. The Bonds shall be issued in such denominations, shall bear interest at such rate or rates, not exceeding the maximum rate authorized by applicable law, payable at such times, shall mature on such dates and in such years and in such amounts and shall have such other terms and conditions as may be determined by subsequent resolution of the County adopted at or prior to the sale of the Series 1988 Bonds. The Series 1988 Bonds shall be issued in fully registered form without coupons; shall be payable with respect to principal at a principal corporate trust office of the Paying Agent; shall be payable in lawful money of the United States of America; and shall bear interest from their date, payable by check mailed to the Registered Owners at their addresses as they appear on the registration books kept by the Bond Registrar on behalf of the County. Notwithstanding any other provisions of this section, the Board may, at its option, prior to the date of issuance of the Bonds and subject to the approval of the purchasers of the Bonds, elect to use an immobilization system or pure book -entry system with respect to issuance of the Bonds, provided adequate records will be kept with respect to the ownership of Bonds issued in book - entry form or the beneficial ownership of the Bonds issued in the name of a nominee. As long as any Bonds are outstanding in book - entry form, the provisions of Sections 7, 9, 10 and 11 of this Resolution shall not be applicable to such book -entry Bonds. The details of any alternative system of Bond issuance, as described in this paragraph, shall be set forth in a resolution of the Board duly adopted at or prior to the delivery of any of the Bonds. SECTION 7. EXECUTION AND AUTHENTICATION OF BONDS. The Bonds shall be executed in the name of the County by the Chairman of the Board attested by its Ex -Officio Clerk and its official seal or a facsimile thereof shall be affixed thereto or reproduced 4 thereon. The signatures of the Chairman and Ex -Officio Clerk may be either manual or facsimile signatures. The certificate of authentication of the Bond Registrar shall appear on the Bonds, and no Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this Resolution unless such certificate shall have been duly executed on such Bond. The authorized signature for the Bond Registrar shall be either manual or in facsimile; provided, however, that at least one of the signatures, including that of the authorized signatory for the Bond Registrar, appearing on the Bonds, shall at all times be a manual signature. In case any one or more of the officers of the Board who shall have signed or sealed any of the Bonds shall cease to be such officer or officers of the Board before the Bonds so signed and sealed shall have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as if the persons who signed or sealed such Bonds had not ceased to hold such offices. Any Bonds may be signed and sealed on behalf of the Board by such person who at the actual time of the execution of such Bonds 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 validation certificate on the Bonds, if any, shall be executed with the manual or facsimile signature of the Chairman of the Board. SECTION 8. NEGOTIABILITY. The Bonds issued hereunder shall be and shall have all of the qualities and incidents of negotiable instruments under the laws of the State of Florida, and each successive holder, in accepting any of the Bonds, shall be conclusively deemed to have agreed that such Bonds shall be and have all of the qualities and incidents of negotiable instruments under the laws of the State of Florida. SECTION 9. REGISTRATION. The Bond Registrar shall be responsible for maintaining books for the registration, transfer and exchange of the Bonds. All Bonds presented for transfer, exchange, redemption or payment (if so required by the Board or the Bond Registrar) shall be accompanied by a written instrument or instruments of transfer or authorization for exchange, in form and with guaranty of signature satisfactory to the Board or the Bond Registrar, duly executed by the Registered Owner or by his duly authorized attorney. In the case of partial redemption of a Bond, and in lieu of issuing a new Bond or Bonds in the aggregate principal amount then outstanding on the Bond after such redemption, the County may, at its option, instruct the bond Registrar to note on the Bond the principal amount of such redemption, the date of redemption and the outstanding principal amount of such Bond after such redemption, and return the Bond to the Registered Owner. 5 14 Upon surrender to the Bond Registrar for transfer or exchange of any Bond accompanied by an assignment or written authorization for exchange, whichever is applicable, duly executed by the Registered Owner or his attorney duly authorized in writing, the Bond Registrar shall deliver in the name of the Registered Owner or the designated transferee or transferees, as the case may be, a new fully registered Bond or Bonds of authorized denominations and of the same maturity and interest rate, in an aggregate principal amount equal to the principal amount that remains outstanding with respect to such Bond so surrendered. The Bond Registrar or the Board may require payment from the Registered Owner or his transferee of a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in connection with any transfer or exchange of the Bonds. Such charges and expenses shall be paid before any such new Bond shall be delivered. Interest on the Bonds shall be paid to the Registered Owner whose name appears on the books of the Bond Registrar as of 5:00 P.M. local time at the location of the Bond Registrar on the Record Date. New Bonds delivered upon any transfer or exchange shall be valid obligations of the County, evidencing the same debt as the Bonds surrendered, shall be secured by this Resolution, and shall be entitled to all of the security and benefits hereof to the same extent as the Bonds surrendered. The County and the Bond Registrar may treat the Registered Owner of any Bond as the absolute owner thereof for all purposes, whether or not such Bond shall be overdue, and shall not be bound by any notice to the contrary. SECTION 10. DISPOSITION OF BONDS PAID OR REPLACED. Whenever any Bond shall be delivered to the Bond Registrar for cancellation, upon payment of the principal amount thereof, or for replacement, transfer or exchange, such Bond shall be cancelled and destroyed by the Bond Registrar, and counterparts of a certificate of destruction evidencing such destruction shall be furnished to the County. SECTION 11. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated, or be destroyed, stolen or lost, the County may, in its discretion, issue and deliver a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange for and cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed, stolen or lost, upon the Registered Owner furnishing the County and the Bond Registrar proof of his ownership thereof and the loss thereof (if lost, stolen or destroyed) and satisfactory indemnity and complying with such other reasonable regulations and conditions as the Board 1.1 s may prescribe and paying such expenses as the Board and the Bond Registrar may incur. All Bonds so surrendered shall be cancelled by the Bond Registrar. If any such Bonds shall have matured or be about to mature, instead of issuing a substitute Bond, the County may pay the same, upon being indemnified as aforesaid, and if such Bond be lost, stolen or destroyed, without surrender thereof. Any such duplicate Bonds issued pursuant to this section shall constitute original, additional, contractual obligations on the part of the County whether or not the lost, stolen or destroyed Bonds be at any time found by anyone, and such duplicate Bonds shall be entitled to equal and proportionate benefits and rights as to lien on and source and security for payment from the funds, as hereinafter pledged, to the same extent as all other Bonds issued hereunder. SECTION 12. PROVISIONS FOR REDEMPTION. The Bonds or any portions thereof shall be subject to redemption prior to their respective stated dates of maturity, at the option of the County or otherwise, at such times and in such manner as shall be determined by subsequent resolution adopted prior to the sale thereof. Notice of such redemption shall, not more than forty-five (45) days and not less than thirty (30) days prior to the redemption date, (i) be filed with the Bond Registrar and Paying Agent, and (ii) be mailed, postage prepaid, to all Registered Owners of Bonds to be redeemed at their addresses as they appear of record on the books of the Bond Registrar as of forty-five (45) days prior to the date fixed for redemption. Interest shall cease to accrue on any Bond duly called for prior redemption on the redemption date, if payment thereof has been duly provided. The privilege of transfer or exchange of any of the Bonds so called for redemption shall be suspended commencing 45 days preceding the date fixed for redemption. SECTION 13. FORM OF BONDS. The text of the Bonds, the validation certificate thereon and the certificate of authentication thereon shall be in substantially the following form, with such omissions, insertions and variations as may be necessary and/or desirable and authorized or permitted by this Resolution or any subsequent resolution adopted prior to the issuance thereof, or as may be necessary to comply with applicable laws, rules and regulations of the United States and the State of Florida in effect upon the issuance thereof: No. R- $ UNITED STATES OF AMERICA STATE 07 FLORIDA INDIAN RIVER COUNTY WATER REVENUE BOND, SERIES 1958 RATE OF INTEREST MATURITY DATE DATE OF ORIGINAL ISSUE CUSIP 7 REGISTERED OWNER: PRINCIPAL AMOUNT: KNOW ALL MEN BY THESE PRESENTS, that INDIAN RIVER COUNTY, FLORIDA (the "County"), for value received, hereby promises to pay to the Registered Owner named above, or registered assigns, solely from the Pledged Funds, hereinafter defined, on the Maturity Date specified above, the Principal Amount specified above and to pay, solely from such Pledged Funds, interest on this Water Revenue Bond, Series 1988 (the "Bond"), from the Date of Original Issue specified above, or from the most recent interest payment date to which interest has been paid, as applicable, at the Rate of Interest specified above, per annum, such interest being payable initially on , 198_ and semi-annually thereafter on each and until the Principal Amount hereof is paid in full. The Principal Amount hereof shall be payable, upon presentation and surrender hereof, on or after the Maturity Date or date of earlier redemption, at a principal corporate trust office of , Florida, as Paying Agent and Bond Registrar. The interest hereon shall be paid, when due, by check mailed to the Registered Owner at his address as the same appear at 5:00 P.M. local time at the location of the Bond Registrar on the fifteenth (15th) day of the month immediately preceding the applicable interest payment date on the registration books kept by the Bond Registrar on behalf of the County. The principal of, premium, if any, and interest on this Bond are payable in lawful money of the United States of America. This Bond is one of the revenue bonds authorized by the County under the authority of and in full compliance with the Constitution and laws of the State of Florida, including particularly Chapters 125 and 159, Florida Statutes (1987), and Resolution No. of the County, all as amended and supplemented, and other applicable provisions of law. The above - referenced resolution as amended and supplemented from time to time is hereinafter referred to as the "Resolution". This Bond is subject to all the terms and conditions of the Resolution. This Bond is one of the revenue bonds designated as Water Revenue Bonds, Series 1988, all of like date and tenor, except as to numbers, denominations, dates of maturity, rates of interest and provisions for redemption, in the aggregate principal amount of Four Million Dollars ($4,000,000) (the "Bonds"). The proceeds of the Bonds will, inter alia, be used to pay the cost of the purchase of the wastewater treatment and distribution system described in the Resolution (the "System") and be used to pay certain costs and expenses relating to issuance of the Bonds. This Bond and the interest due hereon are payable solely from and are secured solely by a first lien upon and pledge of the surcharges to be derived by the County from the operation of the System and certain funds and accounts pledged for the payment of the principal of, interest and premium, if any, on the Bonds and certain earnings thereon, all as provided in the Resolution (the "Pledged Funds"). This Bond does not constitute a general indebtedness of the County within the meaning of any constitutional or statutory provision or limitation. It is expressly agreed by the Registered Owner of this Bond that such Registered Owner shall never have the right to require or compel the exercise of the ad valorem taxing power of the County for the payment of the principal of, interest or premium, if any, on this Bond or the making of any other payments specified by the Resolution. It is further agreed between the County and the Registered Owner of this Bond that this Bond and the indebtedness evidenced hereby shall constitute a lien upon only the Pledged Funds in the manner provided in the Resolution. (To be inserted where appropriate on face of bond: "Reference is hereby made to the further provisions of this Bond set forth on the reverse side hereof, and such further provisions shall for all purposes have the same effect as if set forth on this side.") This Bond may be transferred only upon the books kept by the Bond Registrar, on behalf of the County, upon surrender hereof at the principal corporate trust office of the Bond Registrar with an assignment duly executed by the Registered Owner or his duly authprized attorney, but only in the manner, subject to the limitations and upon payment of a sum sufficient to cover any tax, fee or governmental charge that may be imposed in connection with such transfer, all as provided in the Resolution. Upon such transfer, there shall be executed in the name of the transferee, and the Bond Registrar shall deliver, as early as practicable, a new fully registered bond or bonds of authorized denominations in the same aggregate principal amount, series, maturity and interest rate as this Bond. In like manner, subject to said conditions and upon payment of any such sum, this Bond may -be surrendered at said office of the Bond Registrar in exchange for an equal aggregate principal amount of new fully registered bonds of authorized denominations in the same series, maturity and interest rate as this Bond. 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 tho issuance of this Bond exist, have happened and have been performed in regular and due form and time as required by the Constitution and laws of the State of Florida applicable thereto. r7 . 0 This Bond is and has all the qualities and incidents of a negotiable instrument under the laws of the State of Florida. [Insert redemption provisions] Notice of such redemption shall be given in the manner provided in the Resolution. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Resolution until the certificate of authentication hereon shall have been executed by the Bond Registrar. IN WITNESS WHEREOF, Indian River County, Florida, has issued this Bond and has caused the same to be executed by the Chairman of the Board of County Commissioners of the County and attested by the Ex -officio Clerk of the Board, either manually or with their facsimile signatures, and its official seal, or a facsimile thereof, to be affixed, impressed, imprinted or otherwise reproduced hereon, all as of the day of , 198. (SEAL) INDIAN RIVER COUNTY, FLORIDA Chairman ATTEST: Ex -Officio Clerk CERTIFICATE OF AUTHENTICATION OF BOND REGISTRAR This Bond is one of the within -defined Bonds. 10 As Bond Registrar By Authorized Signature Date of Authentication VALIDATION CERTIFICATE This Bond is one of the bonds which were validated and confirmed by judgment of the Circuit Court of the Nineteenth Judicial Circuit of Florida in and for Indian River County, Florida, rendered on tl 198_. Chairman, Board of County Commissioners of Indian River County, Florida The following abbreviations, when used in the inscription on the face of this Bond, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in UNIF GIF MIN ACT - common (Cust.) TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship Custodian for (Minor) under Uniform Gifts to Minors Act of (State) Additional abbreviations may also be used though not in list above. ASSIGNMENT FOR VALUE RECEIVED, the undersigned sells, assigns and transfers to (Name and address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE 11 this Bond and does hereby irrevocably constitute and appoint as his agent to transfer this Bond on the books kept for registration hereof, with full power of substitution in the premises. (Signature of Transferor) (Signature of Transferor) Date: Signature guaranteed: (Name of Bank, Trust Company or Firm) By. Title: NOTICE: Signature(s) must be guaranteed by a member of a major stock exchange or a assignment or a commercial bank or trust company. 12 NOTICE: No transfer will be registered and no new Bond will be issued in the name of the Transferee, unless the signature(s) to this assign- ment corresponds with the name of the Registered Owner as it appears upon the face of this Bond in every particular, without alteration, enlarge- ment or any change whatsoever and the full address and Social Security or Federal Employer Identification Number of the Transferee is supplied. t Payment Date PARTIAL REDEMPTION PAYMENTS Principal Amount Paid Authorized officer of Balance of Bond Principal Unpaid Registrar SECTION 14. BONDS NOT GENERAL OBLIGATIONS. The Bonds shall not be or constitute general or moral obligations or a pledge of the faith, credit or taxing power of the County, the State of Florida or any political subdivision thereof or an indebtedness of any of them as "bonds" within the meaning of the Constitution of the State of Florida, but shall be special obligations of the County payable solely from and secured solely by a lien upon and a pledge of the Pledged Funds. No Registered Owner shall ever have the right to compel the exercise of the ad valorem taxing power of the County, the State of Florida or any political subdivision thereof, or taxation in any form of any real property therein, to pay the Bonds or the interest thereon, or be entitled to payment of such principal and interest from any funds of the County other than the Pledged Funds. SECTION 15. SECURITY FOR BONDS. The payment of the principal of, premium, if any, and interest on the Bonds shall be secured forthwith equally and ratably by a pledge of and a first lien upon the Pledged Funds. The County does hereby irrevocably pledge the Pledged Funds to the payment of the principal of, premium, if any, and interest on the Bonds. SECTION 16. COVENANTS OF THE COUNTY. For so long as any of the principal of and intarest on any of the Bonds shall be outstanding and unpaid, or until there shall have been set apart in the Sinking Fund hereinafter created, a sum sufficient to pay, when due, the entire principal amount of the Bonds remaining unpaid, together with interest accrued and interest to accrue 13 thereon through such payment date or until the provisions of Section 20 hereof have been satisfied, the County covenants with the holders of the Bonds issued pursuant to this Resolution that: A. REVENUE FUND. All Surcharges shall upon receipt thereof be deposited in the "Water Revenue Fund" (herein the "Revenue Fund"), which is hereby created and established. B. DISPOSITION OF REVENUES. All Surcharges on deposit in the Revenue Fund shall be disposed of by the County as needed or as required herein► only in the following manner and in the following order of priority: (1) First, deposit into a fund to be known as the "Water Revenue Bonds Sinking Fund" (herein the "Sinking Fund"), which is hereby created and established, such sums as will be sufficient to pay interest on the Bonds as the same shall become due and the principal amount of the Bonds as the same mature. Such deposit shall take into account the sums, if any, in the Bond Amortization Account, hereinafter defined, attributable to such payments and the sums, if any, deposited in the Sinking Fund out of proceeds from the sale of Bonds to pay interest thereon. In addition, there shall be deposited in the Sinking Fund amounts sufficient to pay the fees and charges of the Paying Agent. (2) Second, deposit into an account in the Sinking Fund to be known as the "Bond Amortization Account", hereby created and established, such sums as are required by resolution of the County to be deposited therein at such times as are required thereby for each series of term bonds for purposes of the mandatory redemption thereof. (3) Third, deposit into an account in the Sinking Fund to be known as the "Reserve Account", which is hereby created and established, a sum at least equal to and sufficient to pay the maximum amount of principal and interest on all outstanding Bonds becoming due in any ensuing Fiscal Year. A sum to be specified by subsequent resolution of the County may be deposited in the Reserve Account out of the proceeds of the sale of Bonds. Provided, however, in no Fiscal Year shall Surcharges in excess of twenty per cent (20%) of the maximum amount of principal and interest on all outstanding Bonds becoming due in any ensuing Fiscal Year be required to be deposited in the Reserve Account. No further deposits shall be required to be made into the Reserve Account as long as there shall remain on deposit therein (including any Reserve Account insurance policy or letter of credit as described below) a sum equal to the maximum amount of principal and interest on all outstanding Bonds becoming due in any ensuing Fiscal Year. The value of the Reserve Account, including investments on deposit in the Reserve Account, shall be determined 14 annually on the first day of the Fiscal Year by an independent firm of certified public accountants, who may be the accountants for the County, in accordance with generally accepted accounting principles. Notwithstanding the foregoing provisions, in lieu of, in whole or in part, the required deposits into the Reserve Account, the County may cause to be deposited into the Reserve Account either an insurance policy issued by a reputable and recognized municipal bond insurer or a letter of credit from a bank or trust company whose municipal bond insurance policy or letter of credit will result in the highest rating of municipal obligations of either Moody's Investors Service or Standard & Poor's Corporation. Any such insurance policy or letter of credit shall be payable or available to be drawn upon, as the case may be (upon V',e giving of notice as required thereunder), on any interest payment date on which a deficiency exists which cannot be cured by money in any other fund or account held pursuant hereto and available for such purpose. If a disbursement is made under any such insurance policy or letter of credit, the County may reinstate the maximum limits of such insurance policy or letter of credit immediately following such disbursement, otherwise the amount of credit toward the Reserve Account requirement for such insurance policy or letter of credit shall be appropriately reduced. Furthermore, the County may at any time and from time to time cause to be deposited in the Reserve Account such an insurance policy or letter of credit and cause an appropriate amount to be withdrawn from the Reserve Account and released to the County. Moneys in the Reserve Account shall be used only for the purpose of the payment of maturing principal of or interest on Bonds when the other moneys in the Sinking Fund are insufficient therefor, and for no other purpose. However, upon the valuation of the Reserve Account in each year, if the moneys applied and allocated to the Reserve Account (except the investment income thereon) exceed the amount required, such excess may be withdrawn and released to the County. No further deposits to the Sinking Fund, the Bond Amortization Account or the Reserve Account shall be required when the aggregate sums deposited therein are and remain at least equal to the sum of all of the principal and interest then due and thereafter becoming due in all ensuing years for the Bonds then outstanding. (4) Fourth, apply monriys in the Revenue Fund to the payment of current debt service and reserve requirements of any obligations of the County issued to finance the cost of additions, acquisition, extensions and improvements to the System which are junior and subordinate to the lien of the Bonds on the Pledged 15 Funds. (5) The balance of any moneys remaining in the Revenue Fund after the above required payments have been made may be used by the County for any lawful purpose. C. PLEDGED FUNDS AND INVESTMENT OF FUNDS. The Revenue Fund, the Sinking Fund, the Bond Amortization Account and the Reserve Account shall be Pledged Funds, shall constitute trust funds for the purposes provided herein for such funds and shall be used only for the purposes and in the manner provided herein. All moneys in all funds and accounts created or established hereunder shall be continuously secured in the manner by which deposits of public funds are required to be secured by the laws of the State of Florida. Moneys on deposit in the Revenue Fund and the Sinking Fund (except the Reserve Account therein) may be invested and reinvested only in Authorized Investments maturing not later than the date on which the moneys therein will be needed for the purposes of such funds. Moneys in the Reserve Account may be invested and reinvested in Authorized Investments maturing not later than five (5) years from the date of purchase. Any and all income received by the County from such investments shall be deposited into any rebate accounts hereunder to the extent required and the excess, if any, into the Revenue Account. D. OPERATION AND MAINTENANCE. The County will maintain the System and all parts thereof in good condition and will operate the same in an efficient and economical manner making such expenditures for equipment and for renewals, repairs and replacements as may be proper for the economical operation and maintenance thereof. E. RATE COVENANT. In conjunction with the adoption of its annual budget and as otherwise required, the County shall fix, establish and maintain such Surcharges for the System and shall collect the same and revise the same from time to time, whenever necessary, so as to always provide Surcharges in each Fiscal Year sufficient to pay (1) one hundred percent (100%) of all required deposits into the Reserve Account, and (2) one hundred percent (100°x) of the amount of principal and interest becoming due in such Fiscal Year on the Bonds. Such Surcharges shall not be reduced so as to be insufficient to provide the aforesaid required revenues. F. BOOKS AND RECORDS. The County shall keep proper books, records and accounts, showing correct and complete entries of all transaction of the County relating to the System. Registered Owners of the Bonds shall have the right at all reasonable times to inspect all bcoks, records and accounts of the County relating to the System. G. ANNUAL AUDIT. The County shall also, at least once a year, within 180 days after the close of its Fiscal Year, cause 16 0 the books, records and accounts relating to the entire water and sewer system of the County, including the System, to be audited by a independent firm of certified public accountants. A copy of such annual audits shall be furnished to any Registered Owner of the Bonds who shall have requested in writing that a copy of such audits be furnished him. H. NO MORTGAGE OR SALE OF THE SYSTEM. The County will not sell, mortgage, pledge or otherwise encumber the System or any part hereof, or any Surcharges to be derived therefrom, except as herein provided, and will not sell, lease or otherwise dispose of any substantial portion of the System, except as provided herein. The County may sell, lease or otherwise dispose of any of the property comprising a substantial portion of the System in the event that (a) such property is determined by resolution of the Board, upon the recommendation of the general manager of the System, who may be an employee of the County, and the Consulting Engineers, to be no longer necessary or useful or profitable for the System; and (b) the sale, lease or other disposition of such property is determined by resolution of the Board, upon recommendation of the general manager and the Consulting Engineers, not to impair the ability of the County to comply during the current or any future Fiscal Year with the rate covenant set forth herein. The proceeds derived from any sale, lease or other disposition of a substantial portion of the System shall be used for the retirement of outstanding Bonds. Any other proceeds derived from the sale, lease or other disposition of a portion of the System shall be placed in an appropriate fund of the County relating to the renewal or replacement of the System or the water and sewer system of the County in general; provided, however, all or a portion of any such proceeds may be used for the retirement of outstanding Bonds if authorized by resolution of the Board upon the recommendation of the general manager and the Consulting Engineers. I. INSURANCE. For so long as any of the Bonds are outstanding, the County will carry adequate fire and windstorm insurance on all buildings, structures other appropriate properties of the System which are subject to loss through fire or windstorm, will carry adequate public liability insurance, and will otherwise carry insurance of all kinds and in the amounts normally carried in the operation of similar facilities and properties in Florida. Any such insurance shall be carried for the benefit of the Registered Owners of the Bonds. All moneys received from losses under any of such insurance, except public liability, are hereby pledged by the County as security for the Bonds, until and unless such proceeds are used to remedy the loss or damage for which such proceeds are received, in such event such repairing the property damaged or replacing the property destroyed shall be commenced within a reasonable period after the receipt of such proceeds and shall 17 proceed on a reasonable and continuous basis. J. NO FREE SERVICE. The County will not render or cause to be rendered any free use of any nature of the System, nor will any preferential rates be established for users of the same class. K. ENFORCEMENT OF COLLECTIONS. The County will diligently enforce and collect the Surcharges and any other charges pledged hereunder, will take all steps, actions and proceedings for the enforcement and collection thereof as the same shall become delinquent to the full extent permitted or authorized by law; and will maintain accurate records with respect thereto. All such Surcharges and other charges shall, as collected, be held in trust to be applied as herein provided and not otherwise. L. REMEDIES. Any Registered Owner may by suit, action, mandamus or other proceedings in any court of competent Jurisdiction, protect and enforce any and all rights, including the right to the appointment of a receiver, existing under the laws of the State of Florida, and may enforce and compel the performance of all duties required hereunder or by any applicable statutes to be performed by the County or by any officer thereof. Nothing herein, however, shall be construed to grant to any Registered Owner any lien on any property of or in the County. M. OPERATING BUDGET. The County shall annually prepare and adopt a detailed final budget for the operation of its entire water and sewer system for each Fiscal Year. If the budget discloses that the estimated Surcharges and other charges pledged hereunder, if any, will be insufficient during such Fiscal Year to meet the rate covenant set forth herein, the County shall forthwith revise the Surcharges and other charges in order to cure such estimated deficiency and to comply with the rate covenant. There shall be included in the budget amounts necessary to provide for the orderly replacement of the depreciable capital assets of the entire water and sewer system of the County. N. CONSULTING ENGINEERS. The County will annually retain the Consulting Engineers for the purpose of providing the County with competent engineering counsel with respect to the economical and efficient operation of the entire water and sewer system of the County and in connection with the making of capital improvements thereto and renewals and replacements thereof. The County may, however, employ additional engineers at any time with relation to specific engineering and operation problems arising in connection therewith. 8. NO COMPETING SYSTEMS. To the full extent permitted by law, the County will not grant, renew, extend or allow to expand any franchise or permit for any system similar to the System ku within the service area of the System. P. ISSUANCE OF OTHER OBLIGATIONS. The County will not issue any other obligations, except under the conditions and in the manner provided herein, payable from the Pledged Funds, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or other charge having priority to or being on a parity with the lien of the Bonds and the interest thereon, upon the Pledged Funds. The County may issue obligations other than the Bonds payable from the Pledged Funds provided such obligations are junior and subordinate in all respect to the Bonds as to lien on and source and security for payment from the Pledged Funds and such obligations contain an express statement to that effect. Q. ISSUANCE OF ADDITIONAL PARITY OBLIGATIONS. Additional Parity Bonds, payable on a parity from the Pledged Funds with the Bonds, may be issued from time to time for the construction and acquisition of additions, extensions and improvements to the System or for refunding purposes, in the manner herein provided and upon compliance with both of the following conditions: (1) There shall have been obtained and filed with the County a certificate of an independent firm of certified public accountants of suitable experience and responsibility: (i) stating that the books and records of the County relating to the collection and receipt of the Surcharges and other charges pledged hereunder, if any, derived from the System have been audited by them for the Fiscal Year immediately preceding the date of sale of the proposed obligations or for any twelve (12) consecutive month period out of the eighteen (18) consecutive months immediately preceding the date of sale of the proposed obligations; (ii) setting forth the amount thereof received by the County for the audited period referred to in (i) above, with respect to which such certificate is made; (iii) stating that the amount thereof, as adjusted as hereinafter provided, equal at least 1.00 times the largest amount of principal and interest which will mature and become due in any Fiscal Year thereafter on all Bonds then outstanding, excluding the proposed Additional Parity Bonds. For purposes of (iii) above Surcharges and other charges pledged hereunder may be adjusted so as to fairly represent the operation of the System, provided that the amount and a detailed reason for each such adjustment is set forth in such certificate. (2) The amount thereof as estimated by the Consulting Engineers for the first twelve (12) months following completion of the project for which the Additicnal Parity Bonds are being issued shall equal at least 1.00 times the largest amount of principal and interest which will become due in any succeeding Fiscal Year on the Bonds, including the proposed Additional Parity Bonds. 19 The foregoing conditions shall not apply with respect to Additional Parity Bonds the proceeds of which will be used to complete a project a substantial portion of the cost of which has been or will be paid out of the proceeds of Bonds issued hereunder. Each resolution authorizing the issuance of Additional Parity Bonds shall recite that all of the covenants herein contained will be applicable to such Additional Parity Bonds. Additional Parity Bonds may not be issued hereunder at any time at which the County is in default in performing any of the covenants and obligations assumed hereunder, or all payments herein required to have been made into the accounts and funds, as provided hereunder, have not been made to the full extent required. R. PURCHASE OF SYSTEM. The County will purchase the System as soon as practicable. S. MANAGEMENT OF SYSTEM. The County in operating the System will employ persons of demonstrated ability and experience and will require all employees who may have possession of moneys derived from operation of the System to be covered by a fidelity bond written by a responsibility indemnity company in an amount sufficient to protect the County from loss. T. CONNECTION WITH SYSTEM. The County will, to the full extent permitted by law, require all lands, buildings, residences and other structures within its territorial boundaries which can use the System to connect therewith and use the System and cease to use any other potable water system. U. ARBITRAGE. The County covenants to and with purchasers of the issue which constitutes the Series 1988 Bonds that it will make no use of the proceeds of such issue which will cause the Series 1988 Bonds to be or become "arbitrage bonds" within the meaning of Section 103(b)(2) and Section 148 of the Internal Revenue Code of 1986, as amended (the "Code"), and the regulations implementing said Sections that duly have been published in the Federal Register or with any other applicable regulations implementing said Sections, and the County further covenants to comply with all other requirements of the Code if and to the extent applicable to maintain continuously the Federal income tax exemption of interest on the Series 1988 Bonds. V. FUNDS AND ACCOUNTS. The designation and establishment of the various funds and accounts created herein does not require the establishment of any completely independent, self- balancing funds as such term is ,ommonly defined and used in governmental accounting, but rather is intended solely to constitute an earmarking of certain revenues and assets as provided herein. 20 W. POWER TO ISSUE BONDS AND PLEDGE PLEDGED FUNDS. The County is duly authorized under all applicable laws to create and issue the Bonds and to adopt the Resolution and to pledge the Pledged Funds in the manner and to the extent provided in the Resolution. Except to the extent otherwise provided in the Resolution, the Pledged Funds are and will be free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the security interest, pledge and assignment created by the Resolution, and all action on the part of the County to that end has been and will be duly and validly taken. The Bonds and the provisions of the Resolution are and will be valid and legally enforceable obligations of the County in accordance with their terms and the terms of the Resolution. The County shall at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Pledged Funds and all the rights of the Registered Owners under the Resolution against all claims and demands of all persons whomsoever_. X. BONDS SECURED BY PLEDGE OF PLEDGED FUNDS. The Bonds issued hereunder shall be direct and special obligations of the County payable in accordance with their terms and the provisions of the Resolution from the Pledged Funds hereby pledged for the benefit of the Registered Owners, subject to the provisions of the Resolution permitting the application thereof for the purposes and on the terms and conditions set forth in the Resolution. The Pledged Funds shall immediately be subject to the lien and charge of the Resolution without any physical delivery thereof or further act, and the lien and charge of the Resolution shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise, against the County, irrespective of whether such parties have notice thereof. Y. TAX COVENANTS. The County covenants that it will not take any action or fail to take any action with respect to the proceeds of the Bonds that would result in loss of the exclusion from gross income for federal income tax purposes pursuant to section 103(a) of the Code of interest paid on Outstanding Bonds which, when initially issued and sold, were the subject of an opinion of counsel to the effect that interest thereon was so excludable. With respect to any series of Bonds, the County covenants that any use of the System in the trade or business of any person or entity other than the County, including use under a take -or -pay contract or certain management contracts (the "private business use"), if such use is related to the County's use of the System, will not exceed more than ten percent (10%) of the use of the System, or if such private business use in unrelated or disproportionate to the County's use of the System, will not exceed more than five percent (5%) of the use of the System. 21 The County covenants that no more than ten percent (10%) of the Surcharges will be derived directly or indirectly from payments from any nongovernmental user, other than payments by a nongovernmental user as a member of the general public. SECTION 17. APPLICATION OF SERIES 1988 BOND PROCEEDS. All moneys received from the sale of the Series 1988 Bonds shall be deposited and applied by the County as follows: A. All accrued interest plus, at the option of the County, an amount which equals the amount of interest on the Series 1988 Bonds for a reasonable period of time from the date of issuance thereof shall be deposited into the Sinking Fund and applied exclusively for the payment of interest becoming due on the Series 1988 Bonds. B. A sum, if any, specified by subsequent resolution of the County shall be deposited into the Reserve Account in the Sinking Fund. C. Next, all engineering fees, legal fees, fees of financial advisors, costs of the issuance of the Series 1988 Bonds, and all other similar costs incurred in connection with the purchase of the System and the issuance of the Series 1988 Bonds shall be paid or provided for. D. A fund is hereby created and established to be known as the "System Purchase Fund" (herein the "Purchase Fund"). There shall be deposited into the Purchase Fund the balance of the moneys remaining after making all the deposits and payments provided for above. The moneys on deposit in the Purchase Fund shall be withdrawn, used and applied by the County, as and when necessary, solely for the purchase of the System and purposes incidental thereto. If for any reason any moneys in the Purchase Fund are not necessary for or are not applied to the payment of such costs, then such moneys shall be deposited by the County into the Sinking Fund and used only to pay the principal of and interest on the Bonds. Anything to the contrary contained herein notwithstanding, the Purchase Fund shall be and constitute a trust fund for the purposes provided herein therefor and shall be Pledged Funds. Any moneys in the Purchase Fund which, in the opinion of the County, are not immediately necessary for expenditure, as hereinabove provided, may be invested in Authorized Investments maturing at such time or times as will make the proceeds thereof available when needed. All incove derived therefrom shall be deposited in the Purchase Fund. All expenditures or disbursements from the Purchase Fund shall be made only after such expenditures or disbursements shall 22 Y4b have been approved in writing by the County. SECTION 18. REBATE. Anything to the contrary contained herein notwithstanding, the County shall at least annually transfer appropriate amounts from the funds and accounts hereunder to which income on investments has been deposited into an account to be known as the "Series 1988 Rebate Account" sufficient to pay to the United States of America all amounts due with respect to the Series 1988 Bonds under the provisions of Section 148 (f) of the Internal Revenue Code of 1986, as amended and supplemented, or under similar provisions of subsequent federal revenue laws. The earnings on the Rebate Account shall be added to and become a part of the Rebate Account. Moneys in the Rebate Account shall only be used to pay the amounts due to the United States of America under said Section of the Code as the same shall become due and payable. It is the intent of this paragraph to provide for payment of all amounts due under said Section of the Code with respect to the Series 1988 Bonds, in such installments and at such times as may be required by said Section of the Code. In the event of any amendment to the Code or the promulgation of regulations under the Code which provide or require otherwise than as provided or required in this paragraph, this paragraph shall be deemed to be amended to incorporate such amendments or regulations, to the extent applicable, and any provisions hereof which conflict with the provisions thereof shall be deemed to be null and void. The County shall establish appropriate rebate accounts for any and all Additional Parity Bonds and junior and subordinate obligations issued hereunder and provide for the adequate funding thereof. SECTION 19. SALE OF BONDS. The Bonds may be sold at public or private sale pursuant to the Act, all at one time or from time to time, as shall be provided by subsequent resolution of the Board. SECTION 20. DEFEASANCE. If at any time the County shall have paid, or shall have made provision for payment of, the principal, interest and premiums, if any, with respect to the Bonds or series thereof, then, and in that event, the pledge of and lien on the Pledged Funds in favor of the Registered Owners of the Bonds or such series shall be no longer in effect. For purposes of the preceding sentence, the deposit of Federal Securities or bank certificates of deposit fully secured as to principal and interest by Federal Securities (or the deposit of any other securities or investments which may be authorized by law from time to time and sufficient under such law to effect such a defeasance) in irrevocable trust with a banking institution or trust company, for the sole benefit of the Registered Owners of the Bonds or such series, the principal of and interest on which will be sufficient to pay, when due, the principal, interest and premiums, if any, on the outstanding Bonds or such series, shall be considered "provision for payment". Nothing in this section shall be deemed to require the County to call any of the outstanding Bonds or any 23 �4 series thereof for redemption prior to maturity pursuant to any applicable optional redemption provisions, or to impair the discretion of the County in determining whether to exercise any such option for early redemption. SECTION 21. MODIFICATION OF RESOLUTION. No adverse material modification or amendment of this Resolution, or of any resolution amendatory hereof or supplemental hereto, may be made without the consent in writing of the Registered Owners of 51% or more in aggregate principal amount of the Bonds then outstanding affected by such adverse material modification or amendment; provided, however, that no modification or amendment shall permit a change in the maturity of any Bonds or a reduction in the rate of interest thereon or in the amount of the principal obligation thereof, or affect the unconditional promise of the County to levy, impose and/or collect the Surcharges or other charges pledged hereunder, if any, as herein provided, or to pay the principal of and interest on the Bonds as the same shall become due from the Surcharges or other charges pledged hereunder, if any, or reduce the percentage required above for an adverse material modification or amendment, without the consent of the Registered Owners of all of the Bonds affected thereby. The foregoing shall not apply with respect to supplemental resolutions adopted for the sole purpose of issuing Additional Parity Bonds or junior and subordinate obligations issued hereunder in accordance herewith. SECTION 22. SEVERABILITY. If 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 expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agreements and provisions hereof, and shall in no way affect the validity thereof or of the Bonds issued hereunder. SECTION 23. VALIDATION. The attorney for the County is hereby authorized and directed to institute appropriate proceedings in the Circuit Court of the Nineteenth Judicial Circuit of Florida in and for Indian River County, Florida, for the validation of the Bonds. SECTION 24. REPEALER. All resolutions or parts of resolutions in conflict herewith are hereby repealed. SECTION 25. EFFECTIVE DATE. This Resolution shall take effect immediately upon its adoption. The foregoing resolution was offered by Commissioner Eg eg rt who moved for its adoption. The motion was seconded by Commissioner wheeler and, upon being put to a vote, the vote was as follows: 24 Chairman Don C. Scurlock, Jr. Aye Vice Chairman Gary C. Wheeler Aye Commissioner Richard N. Bird Absent. Commissioner Margaret C. Bowman Commissioner Carolyn K. Eggert The Chairman thereupon declared the Resolution duly passed and adopted this 2nd day of August , 1988. Attest: Freda Wright ,Ex f is ' Cle APPROVED AS TO FORM LEGAL SUFFICIENCY Charles P. Vitunac Attorney for the County BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUN'T'Y, FLORIDA By Do Scur ock, Jr. Chairman 25