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HomeMy WebLinkAbout1979-001RESOLUTION NO. 79-1 RESOLUTION PROVIDING FOR THE ACQUISITION, CONSTRUCTION AND ERECTION OF EXTENSIONS AND IMPROVEMENTS TO THE WATER AND SEWER SYSTEM OF INDIAN RIVER COUNTY, FLORIDA; AUTHORIZING THE ISSUANCE BY THE COUNTY OF NOT EXCEEDING $236,000 WATER AND SEWER REVENUE BONDS, SECOND SERIES 1979, TO FINANCE A PART OF THE COST THEREOF; PLEDGING THE GROSS REVENUES OF SAID SYSTEM, TO SECURE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS; AND PROVIDING FOR THE RIGHTS OF THE HOLDERS OF THE BONDS. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUNTY, FLORIDA, as follows: ARTICLE I GENERAL 1.01 Definitions. When used in this Instrument, the following terms shall have the following meanings, unless the text clearly otherwise requires: "Bonds" shall mean the obligations of the Issuer authorized to be issued pursuant to Section 2.01 of this Instrument and shall be deemed to include also any obligations issued hereafter by the Issuer pursuant to the provisions of Section 3.04 (H) of the Original Instrument. "Chairman" shall mean the Chairman of the Board of County Commissioners of the Issuer. "Clerk" shall mean the Clerk of the Circuit Court of Indian River County, ex officio -Clerk of the Board of County Commissioners of the Issuer.. "Construction Account" shall mean the account or accounts created pursuant to Section 3.03 of this Instrument for the purpose of receiving bond proceeds and other funds to pay the Cost of the Project. "Cost," when used in connection with the Project, shall mean all expenses necessary, appurtenant or incidental to the acquisition and construction of the Project, including without limitation the cost of any land or interest therein or of any fix- tures, equipment or personal property necessary or convenient therefor, the cost of labor and materials to complete such construction, engineering and legal expenses, fiscal expenses, expenses for estimates of costs and of revenues, expenses for plans, specifications and surveys, interest during construction and administrative expenses related solely to the acquisition and' construction of the Project. "Fiscal Year" shall mean the period commencing on October 1 of each year and continuing to and including the suc- ceeding September 30. "Government" shall mean the United States of America, acting through the Farmers Home Administration, U.S. Department of Agriculture. "Gross Revenues" shall mean all moneys received from rates, fees, rentals or other charges or income received by the Issuer or accruing to it in the management and operation of the System, all calculated in accordance with accepted accounting methods employed in the operation of public water and sewer systems similar to the System. "Instrument" shall mean this resolution and all resolu- tions amendatory hereof which may be hereafter duly adopted by the Issuer. "Issuer" shall mean Indian River County, Florida. "Net Revenues" shall mean Gross Revenues less Operating ° Expenses. "Operating Expenses" shall mean the current expenses, paid or accrued, for the operation, maintenance and repair of all facilities of the System, as calculated in accordance with such accepted accounting methods, and shall include, without limiting the generality of the foregoing, insurance premiums, administrative expenses of the Issuer related solely to the System, labor, cost of materials and supplies used for such operation and charges for the accumulation of appropriate reserves for current expenses not -2- annually recurrent but which are such as may reasonably be expected to be incurred in accordance with such accepted accounting methods, but shall exclude payments into the Sinking Fund or the Reserve Account therein and any allowance for depreciation or for renewals or replacements of capital assets of the System. "Original Instrument" shall mean the resolution duly adopted by the Board of County Commissioners of the Issuer on January 23, 1978, authorizing issuance of the Parity Obligations. "Parity Obligations" shall mean the Issuer's Water and Sewer Revenue Bonds, Series 1979, authorized pursuant to the Original Instument. "Pledged Funds" shall mean the Gross Revenues. "Project" shall mean the extensions and improvements to the water facilities of the System in the Gifford area, to be constructed pursuant to the authorization contained in this Instrument in accordance with certain plans and specifications now on file with the Clerk. "Revenue Fund" shall mean the account created pursuant to the provisions of Section 3.04(8) of the Original Instrument, into which all Gross Revenues shall be deposited by the Issuer. "Sinking Fund" shall mean the account created pursuant to Section 3.04(C) of the Original Instrument, into which moneys shall be transferred from the Revenue Fund for the payment of the prin- cipal of and interest on the Bonds. "System" shall mean the complete water and sewer system now owned, operated and maintained by the Issuer, together with any and all improvements, extensions and additions thereto hereafter constructed or acquired. 1.02 Authority for this Instrument. This Instrument is adopted pursuant to the provisions of Part I of Ch. 159, Florida Statutes (1977), and other applicable provisions of law. 1.03 Findings. It is hereby found and determined that: (A) For the benefit of its inhabitants, the Issuer pre- sently owns and operates the System, and the Project is necessary -3- 0 for the continued preservation of the health, welfare, convenience 40 and safety of the Issuer and its inhabitants. (B) The Issuer has been advised by its consulting engi- neers and it is hereby found and determined that the estimated Cost of the Project is $553,600, which shall be paid with the proceeds of the sale of the Bonds and a federal grant in the amount of $317,600. (C) The revenues to be derived annually from the rates, rentals, fees and other charges made and collected for the Services and facilities of the System are estimated to be $ 33,660.00► and will be sufficient to pay, as the same shall become due and payable, the principal of and interest on the Parity Obligations and the principal of and interest on the Bonds and Operating Expenses, the aggregate annual amount of which is estimated to be $23_94n nn It is estimated that the period of usefulness of the Project will exceed forty-one years. (D) It is deemed necessary and desirable to pledge the Pledged Funds to the payment of the principal of and interest on the Bonds. No part of the Pledged Funds have been pledged or hypothecated except with respect to the Bonds and the Parity Obligations. (E) The Original Instrument, in Section 3.04(H) thereof provides for the issuance of additional parity obligations under the terms, limitations and conditions provided therein; and the Issuer is authorized to issue the Bonds as additional parity obli- gations within the authorization contained in Section 3.04(H) of the Original Instrument, by reason of the waiver of the conditions contained therein by the Government which will purchase all of the Parity Obligations. The Bonds shall be on a parity and rank equally as to lien on and source and security for payment from the Pledged Funds, and in all other respects, with the Parity Obligations. (F) This Instrument is declared to be and shall consti- tute a contract_ between the Issuer and all of the holders of the Bonds; and the covenants ar agreements herein set forth to be per- -4- formed by the Issuer are and shall be for the equal 'benefit, pro- tection and security of all of the legal holders of any and all of the Bonds, all of which shall be of equal rank and without pre- ference, priority or distinction of any of the Bonds over any other, except as hereinafter provided. (G) The Issuer is riot, under this Instrument, obligated to levy any ad valorem taxes on any real or personal property' situated within its corporate territorial limits to pay the prin- cipal of or interest on the Bonds or to pay Operating Expenses. The Bonds shall not constitute a lien upon the System or any other property of the Issuer or situated within its corporate territorial limits. 1.04 Project Authorized. The Project is hereby authorized. ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF REVENUE BONDS 2.01 Authorization of Revenue Bonds. Subject and pur- suant to the provisions of this Instrument, obligations of the Issuer to be known as "Water and Sewer Revenue Bonds, Second Series 1979" are hereby authorized to be issued in an aggregate principal amount not exceeding Two Hundred Thirty-six Thousand Dollars ($236,000) for the purpose of providing funds to pay a part of the Cost of the Project. 2.02 Description of Bonds. The Bonds shall be dated as of the date of their delivery; shall bear interest at the rate of 5% per annum, payable on September 1, 1979 and annually thereafter on September 1 of each year; shall be numbered consecutively from one upward in order of maturity; and shall be in the denominations, be numbered and mature on September 1 of each year of maturity thereof (not exceeding forty years from their date) as shall be provided by subsequent resolution of the Board of County Commissioners of the Issuer adopted prior to delivery of the Bonds to the purchaser thereof. 2.03 Places of Payment. The Bonds shall be issued in coupon form; shall be payable as to both principal and interest at -5- such place or places as the Issuer shall hereafter by resolution-' designate, in lawful money of the United States of America; and shall bear interest from the date of issue, in accordance with and upon surrender ()f the appurtenant interest coupons as they severally mature, unless registered; provided, however, that Bonds held by the Government shall be payable at "Finance Office, U.S. Department of Agriculture, Farmers Home Administration, 1520 Market Street, St. Louis, Missouri 63101," or at such other places as the Government shall from time to time in writing designate to the Issuer. 2.04 Provisions for Redemption. Bonds maturing on or before September 1, 1989 are not subject to redemption prior to their respective stated dates of maturity. Bonds maturing September 1, 1990 and thereafter shall, at the option of the Issuer, be redeemable in whole or in part, in inverse numerical and maturity order, on September 1, 1989 or on any interest payment date thereafter at par and accrued interest, plus the following premiums, expressed as percentages of the par value of the Bonds so redeemed, if redeemed in the following years: 58, if redeemed on September 1, 1989 or thereafter, to and including September 1, 1991; 48, if redeemed on September 1, 1992 or thereafter, to and including September 1, 1996; 38, if redeemed on September 1, 1997 or thereafter, to and including September 1, 2000; 2%, if redeemed on September 1, 2001 or thereafter, to and including September 1, 2004; 1%, if redeemed on September 1, 2005 or thereafter, to and including September 1, 2008; Without premium, if redeemed September 1, 2009 or thereafter, but prior to maturity; provided, however, that at least thirty (30) days prior to the redemption date written notice of such redemption shall be given to the paying agents for the Bonds and to each of the registered owners at their respective addresses as they appear upon the registration books of the Clerk and shall be published at least once in a financial newspaper published in the City of New York, New York. Bonds held by the Government may be redeemed by the -6- Issuer on any interest payment date prior to maturity at the price of par and accrued interest, without premium. 2.05 Execution of Bonds. The Bonds shall be executed in the name of the Issuer with the manual or facsimile signature of the Chairman and the corporate seal of the Issuer shall be imprinted thereon, attested and countersigned with the manual or facsimile signature of the Clerk, provided that the signature of one of such officers shall be manually executed thereon. In case any one or more of the officers who shall have signed or sealed any of the Bonds or whose facsimile signature shall appear thereon shall cease to be such officer of the Issuer before the Bonds so signed and sealed have been actually sold and delivered such Bonds may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. The validation certificate endorsed on the Bonds shall be executed with the manual or facsimile signature of the Chairman. Any Bond may be signed and sealed on behalf of the Issuer by such person who at the actual time of the execution of such Bond shall hold the proper office of the Issuer, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The coupons attached to the Bonds shall be authenticated with the facsimile signatures of any present or future Chairman and Clerk. The Issuer may adopt and use for such purposes the facsimile signatures of any such persons who shall have held such offices at any time after the date of the adoption of this Instrument, notwithstanding that either or both shall have ceased to hold such office at the time the Bonds shall be actually sold and delivered. 2.06 Negotiability and Registration. The Bonds shall be and shall have all the qualities and incidents of negotiable instruments under the law merchant and the Laws of the State of Florida, and each successive holder, in accepting any of the Bonds or the coupons appertaining thereto, shall be conclusively deemed to have agreed that the Bonds shall be and have all of said quali- ties and incidents of negotiable instruments. -7- y The Bonds may be registered, at the option of the holder, as to both principal and interest upon the books kept for the registration and transfer of Bonds by the Clerk, as Bond Registrar, and endorsed upon the Bonds by the Bond Registrar in the space pro-- vided thereon. After such registration, no transfer of the Bonds shall be valid unless made at the office of the Bond Registrar by the registered owner or by his duly authorized agent or represen- tative and similarly noted on the Bonds, but at the expense of the holder the Bonds may be discharged from registration by being in like manner transferred to bearer, and thereupon transferability by delivery shall be restored. At the option and expense of the holder, the Bonds may thereafter again from time to time be registered or transferred to bearer as before. The Bond Registrar shall not be required to make any such transfer of Bonds during fifteen (15) days next preceding an interest payment date on the Bonds, or in the case of any proposed redemption of Bonds, after such Bonds have been selected for redemption. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of any Bond and the interest on any Bond shall be made only to or upon the order of the registered owner thereof or his legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond including the interest thereon to the extent of the sum or sums so paid. 2.07 Bonds Mutilated, Destroyed, Stolen or Lost. In case any Bond shall become mutilated, or be destroyed, stolen or lost, the Issuer may in its discretion issue and deliver a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond, upon surrender and cancellation of such mutilated Bond, or in lieu of and substitution for the Bond destroyed, stolen or lost, and upon the owner furnishing the Issuer satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer may prescribe and paying such expenses as the Issuer may -8- incur. All Bonds so surrendered shall be cancelled by the Clerk, If any such Bonds shall have matured or be about to mature, instead of issuing a substitute Bond the Issuer 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 Issuer 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 Pledged Funds to the same extent as all other Bonds issued hereunder. 2.08 Form of Bonds. The text of the Bonds shall be in substantially the following form, with only such omissions, inser- tions and variations as may be necessary and/or desirable and approved by the Chairman or the Clerk prior to the issuance thereof (which necessity and/or desirability and approval shall be presumed by such officer's execution of the Bonds and the Issuer's delivery of the Bonds to the Government or other purchaser thereof): No. UNITED STATES OF AMERICA STATE OF FLORIDA COUNTY OF INDIAN RIVER WATER AND SEWER REVENUE BOND SECOND SERIES 1979 KNOW ALL MEN BY THESE PRESENTS, that Indian River County, a political subdivision of the State of Florida (the "Issuer"), for value received, hereby promises to pay to the bearer, or if this Bond be registered to the registered holder as herein provided, on the first day of September, 19,, from the special. funds hereinafter mentioned, the principal sum of THOUSAND DOLLARS and to pay interest thereon, from the date of the delivery of this Bond to the purchaser thereof, solely from said special funds, at the rate of five per centum (58) per annum, payable on September 1, 1979 and annually thereafter on the first day of September of each year upon the presentation and surrender of the annexed coupons -s 2:Z they severally fall due, unless registered. interest on this Bond are payable at U United States of America. Both principal of and .r , in lawful money of the This Bond is one of an authorized issue of Bonds in the aggregate principal amount of $236,000 of like nate, tenor and effect, except as to number, denomination and date of maturity, issued to finance a part of the cost of acquiring, erecting and constructing extensions and improvements to the combined water and sewer system of the Issuer (the "System"), under the authority of and in full compliance with the Constitution and Statutes of the State of Florida, particularly Part I of Ch. 159, Florida Statutes (1977), and a resolution duly adopted by the Issuer on January 23, 1978, as supplemented by a resolution duly adopted by the Issuer on , 1979 (jointly, the "Resolution"), and is subject to all the terms and conditions of the Resolution. This Bond and the interest thereon are payable solely from and secured by a prior lien upon and a pledge of the gross revenues to be derived from the operation of the System, in the manner described in the Resolution. It is expressly agreed by the holder of this Bond that the full faith and credit of the Issuer are not pledged to the payment of the principal of and interest on this Bond and that such holder shall never have the right to require or compel the exercise of any taxing power of the Issuer to the payment of such principal and interest or the cost of main- taining, repairing and operating the System. This Bond and the obligation evidenced hereby shall not constitute a lien upon the System or any part thereof or upon any other property of the Issuer or situated within its corporate limits, but shall constitute a lien only on the gross revenues derived from the operation of. the System. The Bonds of this issue are payable on a parity, equally and ratably, from such gross revenues with the Issuer's Water and Sewer Revenue Bonds, Series 1979 authorized pursuant to said resolution adopted by the Issuer on January 23, 1978 (the -10- I "parity obligations"). r In and by the Resolution, the Issuer has covenanted and agreed with the holders of the Bonds of this issue that it will fix, establish, revise from time to time whenever necessary, main- tain and collect always such fees, rates, rentals and other charges for the use of the product, services and facilities of the System which will always produce cash revenues sufficient to pay, and out of such funds pay, as the same shall become due, the principal of and interest on the parity obligations and the Bonds, the necessary expenses of operating and maintaining the System and all reserve, Sinking Fund or other payments required by the Resolution, and that such rates, rentals, fees and other charges will not be reduced so as to be insufficient to provide funds for such purposes. The Bonds of this issue maturing on or before September 1, 1989 are not subject to redemption prior to their respective stated dates of maturity. Bonds maturing September 1, 1990 and thereafter shall, at the option of the Issuer, be redeemable in whole or in part, in inverse numerical and maturity order, on September 1, 1989 or on any interest payment date thereafter at par and accrued interest, plus the following premiums, expressed as percentages of the par value of the Bonds so redeemed, if redeemed in the following years: 58, if redeemed on September 1, 1989 or thereafter, to and including September 1, 1991; 48, if redeemed on September 1, 1992 or thereafter, to and including September 1, 1996; 3%, if redeemed on September 1, 1997 or thereafter, to and including September 11 2000; 2%, if redeemed on September 1, 2001 or thereafter, to and including September 1, 2004; 1%, if redeemed on September 1, 2005 or thereafter, to and including September 1, 2008; Without premium, if redeemed September 1, 2009 or thereafter, but prior to maturity; provided, however, that notice of such redemption shall be given in the manner required by the Resolution. It is hereby certified and recited that all acts, con- ditions, and things required to exist, to happen and to be per- -11- formed precedent to and in the issuance of this Bond, exist, have happened and have been performed, in regular and due form and time as required by the Laws and Constitution of the State of Florida applicable thereto, and that the issuance of this Bond, and of the issue of Bonds of which this Bond is one, does riot violate any constitutional, statutory or charter limitations or provisions. This Bond and the coupons appertaining thereto are and have all the qualities and incidents of negotiable instruments under the law merchant and the Laws of the State of Florida. This Bond may be registered as to both principal and interest in accordance with the provisions endorsed hereon. IN WITNESS WHEREOF, Indian River County, Florida, has issued this Bond and has caused the same to be signed by the Chairman of its Board of County Commissioners and attested and countersigned by the Clerk of the Circuit Court for Indian River County, ex officio Clerk of the Board of County Commissioners, either manually or with their facsimile signatures, and its cor- porate seal or a facsimile thereof to be affixed, impressed, imprinted or engraved hereon, and the interest coupons hereto attached to be executed with the facsimile signatures of such offi- cers, all as of , lg— INDIAN RIVER COUNTY, FLORIDA By Chairman, Board of County Commissioners t• (SEAL) ATTESTED AND COUNTERSIGNED: Z:-lerk of the Circuit Court, ex officio Clerk of the Board of Cnunty Commissioners FORM OF COUPON No. On the 1st day of September 19 , unless the Bond to which this coupon is attached is callable and shall have been pre- viously duly called for prior redemption and payment thereof duly -12- made or provided for, Indian River County, Florida, will pay to bearer at , Florida, from the special funds described in the Bond•to which this coupon is attached, the amount shown hereon in lawful money of the United States of America, upon pre- sentation and surrender of this coupon, being one year's interest then due on its Water and Sewer Revenue Bond Second Series 1979, dated , 19_, No. INDIAN RIVER COUNTY, FLORIDA By Chairman, Board of County Commissioners (SEAL) ATTESTED AND COUNTERSIGNED: Clerk of the Circuit Court, ex officio Clerk of the Board of County Commissioners FORM OF VALIDATION CERTIFICATE This Bond is one of a series of Bonds which were vali- dated by judgment of the Circuit Court for Indian River County, Florida rendered on , 19 Clerk, Board of County Commis- sioners, Indian River County PROVISIONS FOR REGISTRATI This Bond may be registered as to both principal and interest on books kept for such.purpose by said Clerk, as Bond Registrar, such registration being noted hereon by the Bond Registrar in the registration blank below, the coupons being surrendered and the interest being payable only to the registered holder, remitted by mail, after which registration no transfer shall be valid unless made by the registered holder or his legal representative and similarly rioted by the Bond Registrar on said books and in the registration blank below, but it may be discharged from registration by being transferred to bearer, after which it shall be transferable by delivery, or it may again be registered as -13- before. Upon reconversion of this Bond into a coupon Bond, coupons representing the interest to accrue upon the Bond to date of maturity shall be attached hereto. Date of Name and Address of Signature of Registration Registered Owner Bond Registrar ARTICLE III COVENANTS, SPECIAL FUNDS AND APPLICATION THEREOF 3.01 Bonds Not to Be Indebtedness of Issuer. Neither the Bonds nor the coupons attached thereto shall be or constitute general obligations or indebtedness of the Issuer as "bonds" within the meaning of Article VII, Section 12 of the Constitution of Florida, but shall be payable solely from and secured by a prior lien upon and pledge of the Pledged Funds as herein provided. No owner or holder of any Bond or coupon appertaining thereto shall ever have the right to compel the exercise of any ad valorem taxing power to pay such Bond or coupon or Operating Expenses, or be entitled to payment of succi Bond or coupon from any moneys of the Issuer except from the Pledged Funds in the manner provided herein. 3.02 Security for Bonds. The payment of the principal of and interest on the Bonds shall be secured forthwith equally and ratably by a pledge of and prior lien upon the Pledged Funds. The Issuer does hereby irrevocably pledge the Pledged Funds to the payment of the principal of and interest on the Bonds and to the payment into the Sinking Fund at the times provided of the sums required to secure to the holders of the Bonds the payment of the principal thereof and interest thereon at the respective maturities of the Bonds and coupons so held by them. The Bonds are payable from the Pledged Funds on a parity, equally and ratably, with the Parity Obligations. 3.03 Application of Bond Proceeds. The Issuer hereby covenants that it will establish with the -14- Bank, , Florida, a separate account or accounts into which shall be deposited the proceeds from the sale of the Bonds -, (except such portion thereof as shall be necessary to pay interest on the Bonds during the construction of the Project, which shall be deposited in the Sinking Fund), grant funds and the additional funds, if any, required to assure payment in full of the Cost of the Project. Withdrawals from the Construction Account shall be made only for such purposes as shall have been previously specified in the Project Cost estimates and as shall be approved by the Issuer's consulting engineers for the Project. The Issuer's share of any .liquidated damages or other moneys paid by defaulting contractors or their sureties, and all proceeds of insurance compensating for damages to the Project during the period of construction, shall be deposited in the Construction Account to assure completion of the Project. Moneys in the Construction Account shall be secured by the depository bank in accordance with U.S. Treasury Department Circular 176 and in the manner prescribed by the Laws of the State of Florida relating to the securing of public funds. When the moneys on deposit in the Construction Account exceed the estimated disbursements on account of -the Project for the next 90 days, the Issuer may direct the depository bank to invest such excess funds in direct obligations of or obligations the principal of and interest on which are guaranteed by the United States of America, which shall be subject to redemption at any time at face value by the holder thereof. The earnings from any such investment shall be deposited in the Construction Account. When the construction of. the Project has been completed and all construction costs have been paid in full, all funds remaining in the Construction Account, except grant funds, shall be deposited in the Sinking Fund, and the Construction Account shall be closed. All moneys deposited in the Construction Account shall be and constitute a trust fund created for the purposes stated, and there is hereby created a lien upon such fund in favor of the -15- holders of the Bonds until the moneys thereof shall have been .r applied in accordance with this Instrument. 3.04 Covenants of the Issuer. So long as any of the principal of or interest on any of the Bonds shall be outstanding and unpaid, or until there shall have been set apart in the Sinking Fund, including the Reserve Account therein, a sum sufficient to pay, when due, the entire principal of the Bonds remaining unpaid, together with interest accrued and to accrue thereon, the Issuer covenants with the holders of any and all of the Bonds as follows: (A) Application of Provisions of Original Instrument. The Bonds shall for all purposes (except as herein expressly changed) be considered to be additional parity obligations issued under the authority of Section 3,04(H) of the Original Instrument and shall be entitled to all the protection and security provided therein for the parity obligations, as respectively issued, and shall be in all respects entitled to the same security, rights and privileges enjoyed by the Parity Obligations. The covenants and pledges contained in Section 3.04 of the Original Instrument shall be applicable to the Bonds in like manner as applicable to the Parity Obligations. The principal of, interest on and redemption premiums on the Bonds shall•be payable from the Sinking Fund established by the Original Instrument on a parity with the Parity Obligations, and payments shall be made into such Sinking Fund by the Issuer in amounts fully sufficient to pay the principal of and interest on the Parity Obligations and on the Bonds as such prin- cipal and interest become due. .The Reserve Account established by the Original Instrument shall be applicable pro rata to the Bonds in the same manner as applicable to the Parity Obligations. (B) Increased Deposits to Reserve Account. The monthly deposits to the Reserve Account pursuant to the provisions of Section 3.04(C)(3) of the Original Instrument shall be in the amount of Three Hundred Twenty Dollars ($320), until such time as the funds and investments in the Reserve Account shall equal Thirty-eight Thousand Four Hundred Dollars ($38,400), and monthly thereafter such amount as shall be necessary to maintain in the -16- Reserve Account the sum of Thirty-eight Thousand Four Hundred Dollars ($38,400) but not exceeding Three Hundred Twenty Dollars'" ($320) monthly. (C) Issuance of Other Obligations. The Issuer covenants and agrees that it will not issue any other obligations payable from or secured by the Pledged Funds or any part thereof unless the conditions set forth in Section 3.04(H) of the Original Instrument shall be met, or unless the lien of such obligations is junior and subordinate in all respects to the lien of the Bonds. (D) Compliance with Laws and Regulations. The Issuer covenants and agrees to perform and comply with, in every respect, the loan and grant agreements which it might have with the Government or with any other governmental agency and all applicable Federal and State Laws and regulations. (E) Remedies. Any holder of the Bonds or any coupons appertaining thereto issued under the provisions of this Instrument, or any trustee acting for the holders of such Bonds and coupons, may either at law or in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdiction, pro- tect and enforce any and all rights, including the right to the appointment of a receiver, existing under the Laws of the State of Florida, or granted and contained in this Instrument, and may enforce and compel the performance of all duties required by this Instrument or by any applicable State or Federal statutes to be performed by the Issuer or by any officer thereof. Nothing herein, however, shall be construed to grant to any holder of such Bonds or coupons any lien on any real property of the Issuer. (F) Government Approval of Extensions and Financing. Anything herein to the contrary notwithstanding, while the Government is the holder of any of the Bonds, the Issuer will not borrow any money from any source or enter into any contract or agreement or incur any other liability in connection with making extensions of or improvements to the System, other than normal maintenance of the System, or permit others to do so, without -17- obtaining the prior written consent of the Government. (G) Reimbursement of Advances and Interest Thereon. ., While the Government shall be the holder of any of the Bonds, the Government shall have the right to make advances for the payment of insurance premiums and/or other advances which, in the opinion of the Government, may be required to protect the Government's security interest. In the event of any such advances, the Issuer covenants and agrees to repay the same, together with interest thereon at the same rate per annum as specified in the Bonds, upon demand made at any time after any such expenditure by the Government. Any such amount due the Government shall be secured by a pledge of and lien upon the Pledged Funds, on a parity with the Bonds, and payment thereof shall take priority over any other payments from the Reserve Account. ARTICLE IV MISCELLANEOUS PROVISIONS 4.01 Modification or Amendment. No material modifica- tion or amendment of this Instrument may be made without the con- sent in writing of the holders of two-thirds or more in principal amount of the Bonds then outstanding; provided, 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 in the amount of the principal obligation, or affect the unconditional promise of the Issuer to charge and collect such rates, fees, ren- tals and charges for the use of the product, services and facili- ties of the System and apply the same as herein provided, or reduce the number of such Bonds the written consent of the holders of which are required by this Section for such modification or amend- ment, without the consent of the holders of all such Bonds. 4.02 Creation of Superior Liens. The Issuer covenants that except as herein provided it will not issue any other Bonds, certificates or obligations of any kind or nature or create or cause or permit to be created any debt, lien, pledge, assignment or encumbrance or charge payable from or enjoying a lien upon any of the Pledged Funds ranking prior and superior to the lien created by -18- this Instrument for the benefit of the Bonds. 4.03 Severability of Invalid Provisions. If any one or more of the covenants, agreements or provisions of this Instrument or of the Bonds 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 what- soever be held invalid, then such covenants, agreements or provi- sions shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions of this Instrument and of the Bonds. 4.04 Validation Authorized. The Issuer's Attorney is hereby authorized and directed to institute appropriate proceedings in the Circuit Court for Indian River County, Florida, for the validation of. the Bonds and the proper officers of the Issuer are hereby authorized to verify on behalf of the Issuer any pleadings in such proceedings. 4.05 Sale of Bonds, The Bonds are hereby sold and awarded to the Government at the price of par. 4.06 Conflicts Repealed. All resolutions or parts of resolutions in conflict herewith are hereby repealed. 4.07 Effective Date. This Instrument shall take effect immediately upon its passage. This Resolution shall take effect January 4, 1979. _19- • CURTIFIClT'; OI' •-UJ:�)RDI24C OE'L'ICC!t The undersigned K«1ZLOY CERTIFIES that: 1. Slue is the duly appointed, qualified, and acting Clerk _ of the" Board of County Commissioners (h^rein cill,�d the Board 1 and kezccr of the records thereof, incl,ading the minutes of proceedings; 2. The annexed copy cf extracts from the Minutes of the Special -meeting of the Board held on the 23rd day of January , 1978 , is a true, corre^t, and compared copy of the whole of the original minutes of said noeting on file and o`_ record'insofar as the same relate to the resolution refer_ed•to in said extracts and to the other matters referred to herein; 3. Said meeting was duly convened in' corforrait.y with • all api;Iicable requirements; a Drooer quorum was Dresent through- out said meetino and t e resolution hereinafter mentioned was duly prcTposed, considered, and adopted in conformity .pith appli- cable rcquiremcnts: and all other requirements and proceedings incident to the proper adoption of said resolution have been duly .fulfilled, carried out, and othe`wise observed; 4. SHs is duly authorized to execute this Certificate; and . 5. The copy of the resolution annexed hereto entitled: RESOLUTION NO. 78-6 Resolution providing for the acquisition of a water and sewer system in Indian River County, Florida, and the construction and erection of extensions and improvements- thereto; authoriz- ing the issuance by the County of not exceeding $402,500 water and sewer revenue bonds, series 1979, to finance a part of .the Post thereof; pledging the gross revenues of such system to secure payment of the principal of and interest on the bonds; and providing for the rights of the holders of the bonds. is tree, correct, and compared cou), of the oriciinal resolution refei:rcd is in said oxtr ccs and as finally adoctcd at said nee:.- ing and, `_,) thn extent requires CV law, as thereafter duly sicncd or approved by the proper off7icer or of:icers of the _ — Board_ — , which resolution is on file and.of record. WITiMSS my nand and tt:e seal of the Clerk 23rd a January 1978 this � L c. )- O.. , -_ Freda LJright, Clgrk 40 RESOLUTION NO. 78-6 RESOLUTION PROVIDING FOR TIIE ACQUISITION OF A WATER AND SEWER SYSTEM IN INDIAN RIVER COUNTY, FLORIDA, AND THE CONSTRUCTION AND ERECTION OF EXTENSIONS AND IMPROVEIMENTS ® THERETO; AUTHORIZING TIIE ISSUANCE BY THE COUNTY OF NOT EXCEEDING $402,500 WATER AND SEWER. REVENUE BONDS, SERIES 1979, TO FINANCE A PART OF THE COST THEREOF; PLEDGING ® THE GROSS REVENUES OF SUCH SYSTEM TO SECURE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS; AND PROVIDING FOR THE RIGHTS OF THE HOLDERS OF THE BONDS. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUNTY, FLORIDA, as follows: ARTICLE I GENERAL 1.01 Authority for this Resolution. This Resolution y4 — - (this "instrument") is adopted pursuant to the provisions of Ch. 159, Florida Statutes (1975), and other applicable provisions of law. "1.02 Findings. It is hereby found and determined that: (A) Indian River County, Florida (the "Issuer"), does not presently own or operate a water and sewer system for the benefit of its inhabitants, and it is necessary for the continued preservation of the health, welfare, convenience and safety of the Issuer and its inhabitants to acquire a water distribution and sewage collection and treatment facility and construct and erect extensions and improvements thereto (the "Project" or the "System") in accordance with certain plans and specifications now on file with the Clerk of the Board of County Commissioners of the Issuer (the "Clerk"). (B) The Issuer has been advised by its consulting engineers and it is hereby found and determined that the esti- mated cost of acquiring and constructing the Project in accordance with such plans and specifications is $1,270,000, which shall be paid with the proceeds of the sale of the bonds herein authorized (the "Bonds"), federal grants .in the amount of $792,500 and an . amount of $75,000 derived by the Issuer from its share of revenue sharing proceeds, payable pursuant to Ch. 218, Florida Statutes (1975); and shall be deemed to include all expenses necessary, appurtenant or incidental thereto, including the cost of any land or interest therein or of any fixtures or equipment, or property nec- essary or convenient therefor, the cost of labor and materials to complete such construction, engineering and legal expenses, fiscal expenses, expenses for estimates of costs and revenues, expenses for plans, specifications and surveys, interest during construction, if any, administrative expenses and all other necessary miscellaneous expenses. (C) The revenues to be derived annually from the rates, rentals, fees and other charges made and collected for the services and facilities of the System are estimated to be $ 77,324.00 , and will be sufficient to pay, as the same shall become due and payable, the principal of and interest on the Bonds and the annual cost of operating, repairing and maintaining the System, the aggregate annual amount of which is estimated to be $ 76,746.00 it is estimated that the period of usefulness of the System will exceed forty-one years. (D) It is deemed necessary and desirable to pledge the gross revenues of the System to the payment of the principal of and interest on the Bonrls. No part of such revenues have been pledged or hypothecated except with respect to the Bonds. (E) This instrument is declared to be and shall con- stitute a contract between the Issuer and all of the holders of the Bonds; and the covenants and agreements herein set forth to be performed by the Issuer are and shall be for the equal benefit, protection and security of all of the legal holders of any and all of the Bonds, all of which shall be of equal rank and without preference, priority or distinction of any of the Bonds over any other, except as hereinafter provided. (F) The Issuer is not, under this instrument, obli- gated to levy any ad valorem taxes on. any real or personal property situated within its corporate territorial limits to pay the principal of or interest on the Bonds or to pay the cost of maintaining, repairing and op --rating the System. The Bonds shall not constitute a lien upon the System or any other property of the Issuer or :situated w.i thin its corporate territor. i al limit:... 1.03 Definitions. The following terms in this instru- ment shall have the following meanings unless the text othe noise expressly requires: (A) "Bonds" shall mean the obligations of the Issuer autho- rized to be issued pursuant to Section 2.01 of this instrument and Shall be deemed to includa also any obligations issued hereafter by the Issuer pursuant to the provisions of Section 3.04(11) of this instrument. (B) "Gross Revenues" shall mean all money received .from •rates, fees, rentals or other charges or income received by the Issuer or accruing to it in the management and operation of the System, all calculated in accordance with sound accounting practice. (C) "Operating Expenses" shall mean all current expenses, paid or accrued, for the operation, maintenance and repair of all facilities of the System, as calculated in accordance with sound accounting practice, and shall include, without limiting the gener- ality of the foregoing, insurance premiums, administrative expenses of the Issuer related solely to the System, labor, cost of materials and supplies used for current operation, and charges for the accumu- lation of appropriate reserves for current expenses not annually recurrent but which are such as may reasonably be expected to be incurred in accordance with sound accounting practice, but excluding any'allowance for depreciation or for renewals or replacements of capital assets of the System. (D) "Net Revenues" shall mean Gross Revenues less Operating Expanses. (E) "Fiscal Year" shall mean the period commencing on October 1 of each year and continuing to and including the succeeding September 30. 1,04 Project Authorized. The Issuer is hereby authorized to construct the Project as defined in Section 1.02 (A) above. -3- ARTICLE: II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF REVENUE BONDS 2.01 Authorization of Revenue Bonds. Subject and pursuant to the provisions of this instrument, obligations of the Issuer to be known as "Indian River County, Florida, Water and Sewer Revenue Bonds, Series 1979," (the "Ponds") are hereby authorized to be issued in an aggregate principal amount not ex- ceeding Four Hundred and Two Thousand Five hundred Dollars ($402,500) for the purpose of providing funds to pay a part of the cost of the Project provided for in Section 1.02 hereof. 2.02 Description of Bonds. The Bonds shall be dated as of the date of their delivery; shall bear interest at not exceeding the legal rate per annum, payable on September 1, 1979, and annually thereafter on September 1 of each year; shall be numbered consecutively from one upward in order of maturity; shall be in the denomination of $1,000 or any multiple thereof to and includ- ing $10,000 (except bond number 12 which shall be in the denomination of $6,500), and shall mature on September 1 of each year as follows: YEAR AMOUNT YEAR AMOUNT :1981 $4,000 2000 $ 9,000 .1982. 4,000 2001 10,000 1983 4,000 2002 10,000 1984 4,000 2003 11,000 1985 5,000 2004 11,000 1986 5,000 2005 12,000 1987 5,000 2006 13,000 1988 5,000 2007 13,000 1989 6,000 2008 14,000 1990 6,000 2009 15,000 1991 6,000 2010 15,000 1992 6,500 2011 16,000 1993 7,000 2012 17,000 1994 7,000 2013 18,000 1995 7,000 2014 19,000 1996 8,000 2015 20,000 1997 8,000 2016 20,00.0 1998 9,000 2017 21,000 1999 9,000 2018 23,000 2..03 Places of Payment. The Fronds shall be issued in coupon or fully registered form; shall be payable as to both prin- cipal and interest at -such place or places as the Issuer shall here- after by resolution designate, in lawful money of the United States of America; and shall bear interest from tho date of issue, in accordance with and upon surrender of: the appurtenant in- terest coupons a:; they levo ally mature, tulles:; registered; )provided, howc.vor, that: Bonds hold by the 1111.1Ac:d St:aLe:1 of America, acting through the Farmer, Home Administration, U.S. Department of Agriculture (the "Government"), shall be payable at "Finance Office, U.S. Department of Agriculture, Farmers Home Administration, 1520 Market Street, St. Louis, Missouri 63103," or at such other places as the Government shall from time to time in writing designate to the Issuer. 2.04 Provisions for Redemption. Bonds maturing on or before September 1, 1990, are not subject to redemption prior to their respective stated dates of maturity. Bonds which shall mature September 1, 1991, and thereafter shall, at the option of the Issuer, be redeemable in whole or in part, in inverse num- erical and maturity order, on September 1, 1990, or on any interest payment date thereafter, at par and accrued interest, plus the following premiums, expressed as percentages of the par value of the Bonds so redeemed, if redeemed in the following years: 5%, if redeemed on September 1, 1990, or thereafter, to and including September 1, 1993; 4%, if redeemed on September 1, 1994, or thereafter, to and including September 1, 1997; 3%, if redeemed on September 1, 1998, or thereafter, to and including September 1, 2001; 28, if redeemed on September 1, 2002, or thereafter, to and including September 1, 2005; 1%, if redeemed on September 1, 2006, or thereafter, to and including September 1, 2009; Without premium, if redeemed September 1, 2010, or thereafter, but prior to maturity; provided, however, that at least thirty (30) days prior to the redemption date written notice of such redemption shall be given to the paying agents for the Bonds and to each of the registered owners at their respective addresses as they appear upon the registration books of the Clerk and shall. be published at least once in a financial newspaper published in the city of New York, New York. Bonds held by the Government- may be redeemed by the Issuer on any interest payment date prior to maturity at the price of par and accrued interest, without premium. -5- 2.05 Execution of. Bonds. The Bonds shall be executed ® in the name of the Issuer with the manual or facsimile signature of the Chairman of its Board of County Commissioners and the cor- porate seal of the Board of County Commissioners of the Issuer shall be impressed thereon, attested and countersigned with the manual or O facsimile signature of the Clerk, provided that the signature of one of such officers shall be manually executed thereon. In case any one or more of the officers who shall have signed or sealed any of the Bonds or whose facsimile signature shall appear thereon shall cease to be such officer of the Issuer before the Bonds so signed and sealed have been actually sold and delivered, such Bonds may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. The validation certificate endorsed on the Bonds shall be executed with the manual or facsimile signature of the Chairman of such Board. Any Bond may be signed and sealed on behalf of'the Issuer by such person who at the actual time of the execution of such Bond shall hold the proper office of the Issuer, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The coupons attached to the Bonds shall be authenticated with the facsimile signatures of any present or future Chairman of such Board and Clerk of the Issuer. The Issuer may adopt and use for such purposes the facsiriile signa- tures of any such persons who shall have held such offices at any time after the date of the adoption.of this instrument, notwith- standing that either or both shall have ceased to hold such office at the time the Bonds shall be actually sold and delivered. 2.06 Negotiability and Registration. The Bonds shall be and shall. have all the qualities and incidents of negotiable instruments under the law merchant and the Laws of the state of Florida, and each successive holder, in accepting any of the Bonds or the coupons appertaining thereto, shall be conclusively deemed to have agreed that the, Bonds shall be and have all of the qualities and incidents of: negotiable ills tr.u!nent:s. The Bonds may be registered, at the option of t:he holdor, as to both pri.nc.i.pal and intero:A: upon the hook;; k(,t)t: .4- for the registration and transfer of Bonds by the Clerk, as Bond Registrar, and endorsed upon the Bonds by the Bond Regis- trar in the space provided thereon. After such registration, no transfer of the Bonds shall be valid unless made at the office of the Bond Registrar by the registered owner or by his duly authorized agent or representative and similarly noted on the Bonds, but at the expense of the holders the Bonds may be dis- charged from registration by being in like manner transferred to bearer, and thereupon transferability by delivery shall be _restored. At the option and expense of the holder, the Bonds may thereafter again from time to time be registered or trans- ferred to bearer as before. The Bond Registrar shall not be required to make any such transfer. of Bonds during fifteen (15) days next'preceding an interest payment date on the Bonds, or in the case of any proposed redemption of Bonds, after such Bonds have been selected for redemption. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on account of the principal of any Bond and the interest on any Bond shall be made only to or upon the order of the regis- tered owner thereof or his legal representative. All such pay- ments shall be valid and effectual to satisfy and discharge the liability upon such Bond including the interest thereon to the extent of the sum or sums so paid. 2.07 Bonds Mutilated, Destroved, Stolen or Lost. In case any Bond shall become mutilated, or be destroyed, stolen or lost, the Issuer may in its discretion issue and deliver a riew Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond, upon surrender and cancellation of-such mutilated Bond, or in lieu of and substitution for the Bond destroyed, stolen or lost, and upon the owner furnishing the Issuer satisfactory indemnity and complying with such other reasonable regulations and conditions as the may prescribe and paying such expenses as the Issuer may incur.. All Bonds >o surrendered shall. be cance.iled by the Clerk. If any such licmds shall. hive matured or be about to mature, instead of issuing a substitute .Bond the Issuer may pay the sante, upon being indemnified as aforesaid, and if such Bond be lost, stolen or destroyed, with- out surrender thereof. Any such duplicate Bonds issued pursuant to this section shall constitute original, additional contractual obli- gations on the part of the Issuer 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 proportion- ate 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. 2.08 Form of Bonds. The text of the Bonds shall. be in substantially the following form, with only such omissions, insertions and variations as may be necessary an desirable and approved by the Chairman of the Board of County Commissioners of the Issuer prior to the issuance thereof (which necessity and/ or desirability and approval shall be presumed by his execution of the Bonds and the Issuer's delivery of the Bonds to the purchaser thereof): No. $ UNITED STATES OF ANM RICA STATE OF FLORIDA COUNTY OF INDIAN RIVER WATER AND SEWER REVENUE BOND, SERIES 1979 KNOW ALL MEN BY THESE PRESENTS, that the County of Indian River, Florida (the "Issuer"), a public body created and existing under and by virtue of the Laws of the State of Florida, for value received, hereby promises to pay to the bearer., or if this Bond be registered, to the registered holder as herein pro- vided, on the first day of September, 19`, from the special funds hereinafter mentioned, the principal sum of .DOLLARS and to pay interest thereon, from the date of the delivery of this Bond, to the purchaser thereof., solely from such special funds, it the rate of: _ _ per cent iml (_ %) per x111111111, payable on September .1, 1979, and annually thererlfter -0- on the first day of September of each year upon the presentation and surrender of the annexed coupons as they severally fall due, unless registered. Both principal of and interest on this Bond are payable at in lawful money of the United States of America. This Bond is one of an authorized issue of Bonds in the aggregate principal amount of $402,500 of like date, tenor and effect, except as to number, denomination, interest rate (if all Bonds do not bear the same rate of interest) and date of maturity, issued to finance a part of the cost of acquiring a combined water and sewer system in the Issuer and erecting and constructing ex- tensions and improvements thereto (the "System"), under the auth- ority of and in full compliance with the Constitution and Statutes of the State of Florida, particularly Ch. 159, Florida Statutes . (1975), and a resolution duly adopted by the Issuer on 1977 (the "Resolution"), and is subject to all the terms and condi- tions of the Resolution. This Bond and the interest thereon are payable solely from and secured by a prior lien upon and a pledge of the gross revenues to be derived from the operation of the Svstern, in the manner described in the Resolution. It is expressly agreed by the holder of this Bond that the full faith and credit of the Issuer are not pledged to the payment of the principal of and interest on this Bond and that such holder shall never have the right to require or compel the exercise of any taxing power of the Issuer to the payment of such principal and interest or the cost of maintaining, repairing and operating the System. This Bond and the obligation evidenced hereby shall not constitute a lien upon the System or any part thereof or upon any other property of the Issuer or situated within its corporate limits, but shall constitute a lien only on the gross revenues derived from the operation of the System. In and by the Resolution, the Issuer has covenanted and agreed with the holders of. the Bonds of ilii,- issue that it Will fix, establish, revise from time to time whenever necessary, -9- maintain and collect always such fees, rates, rentals and other charges for the use of the product, services and facilities of the•System which will always produce cash.revenues sufficient to pay, and out of such funds pay, as the same shall become due, the principal of and interest on the Bonds, the necessary expenses of operating and maintaining the System and all reserve, Sinking Fund or other payments required by the Resolution; and that such rates, rentals, fees and other charges will not be reduced so as to be insufficient to provide funds for such purposes. The Bonds of this issue maturing on or before September 1, 1990, are not subject to redemption prior to their respective stated dates of maturity. Bonds which shall mature September 1, 1991, and thereafter shall, at the option of the Issuer, be redeemable in whole or in part, in inverse numerical and maturity order, on September 1, 1990, or on any interest payment date thereafter, at par and accrued interest, plus the following premiums, expressed as percent- ages of the par value of the Bonds so redeemed, if redeemed in the following years: 5%, if redeemed on September 1, 1990, or thereafter, to and including September 1, 1993; 4%, if.redeemed on September 1, 1994, or thereafter, to and including September 1, 1997; 3%, if redeemed on September 1, 1.99£3, or thereafter, to and including September 1, 2001; 2%, if redeemed on September 1, 2002, or thereafter, to and including September 1, 2005; 1%, if redeemed on September 1, 2006, or thereafter, to and including September 1, 2009; Without premium, if redeemed on September 1, 2010, or thereafter, but prior to maturity; provided, however, that notice of such redemption shall be given in the manner required by the Resolution. 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 happened and have been performed, in regular and due form and time as required by Lhe Laws and Constitution of Lhe Slate of Florida applicable thcret_o, and that the issunn.cr. of this nond, -10- and of the issue of Bonds of which this Bond is one, does not violate any constitutional, statutory or charter limitations or provisions. This Bond and the coupons appertaining thereto are and have all the qualities and incidents of negotiable instruments under the law merchant and the laws of the State of Florida. This Bond may be registered as to both principal and interest in accordance with the provisions endorsed hereon. IN WITNESS WHEREOF, the County of Indian River, Florida, has.issued this Bond and has caused the same to"be executed in its name and on its behalf by the Chairman of its Board of County Commissioners and its corporate seal to be impressed hereon, attested and countersigned by the Clerk of such Board, all as of 1979. (SEAL) .ATTESTED AND COUNTERSIGNED: Clerk, Board of County Commissioners COUNTY OF INDIAN RIVER, FLORIDA By Chairman, Board of County Commissioners FORM OF COUPON No. On the 1st day of September, 19_1 unless the Bond to which this coupon is attached is callable and shall have been Previously duly called for prior redemption and payment thereof duly made or provided for, the County of Indian River, Florida, will pay to the bearer at _ , Florida, from the Special funds described in the Bond to which this coupon is attached, the ariount shown hereon in lawful money of the United States of America, upon presentation and surrender of this coupon, being one year's interest then due on its Water. and Sewer Revenue Bond, Series 1979, dated 1979, No. (SEAL) ATTESTED AND COUNTERSIGNED; Clerk, Board of County Commissioners COUNTY OF .I.NDIAN RIVER, FLORIDA By Chairman, Board of County Commissioners FORM OF VALIDATION CERTIFICATE This Bond is one of a series of Bonds which were validated by judgment of the Circuit Court for Indian River County, Florida rendered on 1978. Chairman, Board of County Commissioners PROVISIONS FOR REGISTRATION .This Bond may be registered as to both principal and interest on the books kept by the Clerk of the Board of County Commissioners, as Bond Registrar, such registration being noted hereon by the Bond Registrar in the registration blank below, the coupons being surrendered and the interest being payable only to the registered holder, remitted by mail, after which registration no transfer shall be valid unless made on the books by the registered holder or his legal representative and similarly noted in the re- gistration blank below, but it may be discharged from registration by being transferred to bearer, after which it shall be transferable by delivery, or it may again be registered as before. Upon recon- version of this Bond into a coupon Bond, coupons representing the interest to accrue upon the Bond to date of maturity shall be at- tached hereto. Date of Name and Address of Signature of Registration Rouistered Owner Bond Registrar -12- .� ® ARTICLE III COVENANTS, SPECIAL FUNDS AND APPLICATION TI1BRI70F ® q 3.01 Bonds Not to Be Indebtedness of Issuer. Neither the Bonds nor the coupons attached thereto shall be or constitute • general obligations gations or indebtedness of the Issuer as "bonds" Within the meaning of Article VII, Section 12, Florida Constitution, but shall be payable solely from and secured by a prior lien upon and pledge of the gross revenues, as herein provided. No owner or holder of any Bond or coupon issued hereunder shall ever have the right to compel the exercise of any ad valorem taxing power to pay such Bond or coupon or the cost of operating and maintaining the System, or be entitled to payment of such Bond or coupon from any fuhds of the Issuer except from the gross revenues derived from the operation of. the System in the manner provided herein. 3.02 Security for Bonds. The payment of the debt service of all of the Bonds issued hereunder shall be secured forthwith equally and ratably by a pledge of and a prior lien Upon the gross revenues derived from the operation of the System, as now or hereafter constituted. The Issuer does hereby irrevocably pledge such funds to the payment of the principal of and interest on the Bonds and to the payment into the Sinking Fund at the times provided of the sums required to secure to the holders of the Bonds .issued hereunder the payment of the principal of and interest thereon at the respective maturities of the Bonds and coupons so held by them. 3.03 Application of Bond Proceeds. The Issuer hereby covenants that it will establish with the Florida, a separate account or accounts (herein collectively called the "Construction Account") into which shall. be deposited the proceeds from the sale of the Bonds (except such portion thereof as shall be necessary to pay interest on the Bonds during the construction of the Project, which shall be deposited in the Sinking Fund), grant funds and the additional funds, if any, required to assure payment: in full .13-- r of the cost of the Project. Withdrawals from the Construction Account shall be made only for such purposes as shall have been previously specified in the Project cost estimates and as shall be.approved by the Issuer's consulting engineers for the Project. The Issuer's share of any liquidated damages or other money paid by defaulting contractors or their sureties, and all proceeds of insurance compensating for damages to the Project during the period of construction, shall be deposited in the Construction Account to assure completion of the Project. Money in the Construction Account shall be secured by the depository bank in accordance with U. S. Treasury Depart- xnent Circular 176 and in the manner prescribed by the Laws of the State of Florida relating to the securing of public funds. When the -money on deposit in the Construction Account exceeds the estimated disbursements on account of the Project for the next 90 days, the Issuer may direct the depository bank to invest such excess funds in direct obligations of or obligations the principal of and interest on which are guaranteed by the United States of America, which shall be subject to redemption at any time at face value by the holder thereof. The earnings from any such investment shall be deposited in the Construction Account. When the construction of the Project has been completed and all construction costs have been paid in full, all funds remaining in the Construction Account, except grant funds, shall be used for the purchase or redemption of Bonds or for deposit into a special fund and expended only for paying costs of improvements or extensions to the System or of repairs and replacements of its facilities, and the Construction Account shall be closed. All money deposited in the Construction Account shall be and constitute a trust fund created for the purposes stated, and there is hereby created a lien upon such fund in favor of the holders of the Bonds until the money therein shall have been applied in accordance with this instrument. 3.04 Covenants of the T su,_r. So long as any of the principal of or interest on any of the Bonds shall be outstanding and unpaid, or ui,til. there shal1 have been set apart. in the Sinking Fund herein e::t-abl.i.shed, i.ncl.udi"ut the Roserve Account -14-• therein, a sum sufficient to pay, when due, the entire: principal of the Bonds remaining unpaid, together with interest accrued and to accrue thereon, the Issuer covenants with the holders of any and all of the Bonds as follows: (A) Annual Budget of Operating Expenses. The Issuer covenants and agrees that on or before the date of delivery of the Bonds to the purchaser thereof, it will adept a budget of Operating Expenses for the System for the remainder of the then current Fiscal Year and thereafter, .on or before the first day of each Fiscal Year during which any of the Bonds are outstand- ing, it will adopt an annual budget of Operating Expenses for the ensuing Fiscal Year, and will mail a copy of such budget or amendments thereto to any requesting bondholder. Operating Expenses shall include all reasonable and necessary costs of operating, repairing, maintaining and insuring the System, but shall exclude depreciation, payments into the Sinking Fund and payments into the Reserve Account. The Issuer covenants that the Operating Expenses incurred in any year will not exceed the reasonable and necessary amounts required therefor, and that it will not expend any amount or incur any obligations for the operation, maintenance and repair of the System in excess of the amount provided for Operating Expenses in the annual budget, except upon resolution of the Board of County Commissioners of the Issuer that such expenses are necessary to operate and maintain the System. (B) Revenue Fund. The Issuer covenants and agrees that on or before the date of delivery of the Bonds to the purchaser thereof, it will establish with a depository in the St:3te of Florida, which is a member. of the Federal Deposit Insurance Corporation and which is eligible under the Laws of the State of Florida to receive public funds, and maintain so long as any of. the Bonds are outstanding, a special fund to be known as the "Indian River County Water and Sewer System Revenue Fund" (the "Povenue Fund"). Into such Revenue Fund the Issuer shall deposit promptly as received all cash income derivod from the ownership and operation of t -he Svst:em. The I:evenuc Fund E 1 � shall be he40 ld by the Issuer separate and apart from all other funds and shall be expended and used only in the manner and order 40 specified in paragraphs (C), (D), and (E) of this Section. (C) Bond and Interest Sinking Fund. The Issuer • covenants and agrees to establish with a depository in the State of Florida, which is a member of the Federal Deposit Insurance Corporation, and which is eligible under the Laws of the State of Florida to receive public funds a special fund or funds, -.collectively called "Indian River County Water and Sewer System Bond and Interest Sinking Fund" (the "Sinking Fund"), to be used exclusively for the purposes hereinafter mentioned. As soon after delivery of the Bonds as the System shall be revenue- producing, the Issuer shall transfer on or before the 15th day of each month from the Revenue Fund and deposit to the credit of the Sinking Fund the following amounts: (1) A sum equal to 1/12 of theamount of one year's interest on all the Bonds then outstanding, together with the amount of any deficiency in prior deposits for interest; and (2) Beginning on September 15, 1980, a sum equal to 1/12 of the principal of the Bonds maturing on the next succeed- ing anniversary date, together with the amount of any deficiency in prior deposits for. principal. (3) After fulfillment of the requirements of paragraphs (C)(1) and (2), the Issuer shall transfer on or before the 15th day of each month from the Revenue Fund and deposit to the credit of a special account in the Sinking Fund (the "Reserve Account"), the sum of Two Ilundred Dollars ($200.00) until such time as the funds and investments therein shall equal Twenty-four Thou- sand Dollars ($24,000.00), and monthly thereafter such amount as may be necessary to maintain in the Reserve Account the sum of Twenty- four Thousand Dollars ($24,000.00) but not exceeding Two Hundred Do].lar.s ($200.00) monthly. Money in the Reserve Account shall be used only for (1) paying the cost of repairing or replacing any damage to the System which shall be caused by :in unf.ore:;e.en cata trophc, (2) constructing .imhs•ovemciit.: or exten oi.ons to the System -16 Which shall increase its net revenues and which shall be approved by the consulting engineers, if the Issuer shall not then be in default Under any of the provisions of this instrument, and (3) paying the principal of and interest on the Bonds in the event that the other money in the Sinking Fund shall ever be.insufficient to meet such payments. (D) Operation and Maintenance Fund. The Issuer covenants and agrees to establish with a depository in the State Of Florida, Which is a member Of the Federal Deposit Insurance Corporation, and which is eligible under the Laws of the State of Florida to receive public funds, a special fund to be known as the "Indian River.County Water and Sewer System Operation and Maintenance Fund" (the "Operation and Maintenance Fund"), which shall be used ex- clusively for the purpose of receiving funds to be transferred monthly by the Issuer from the Revenue Fund, and for paying, as they accrue, the Operating Expenses of the System pursuant to the annual budget. As soon after delivery of the Bonds as the System shall be revenue-producing, and after having made the deposits to the Sinking Fund as provided in paragraph (C) above, the Issuer shall transfer on or before the 15th day of each month from the Revenue Fund and deposit to the credit of the Operation and Maintenance Fund a sum sufficient to pay the Operating Expenses of the System for the current month, all in accordance with the annual budget. Any bal- ance remaining in the Operation and Maintenance Fund at the end of the Fiscal Year, and not required to pay costs incurred during the Fiscal Year, shall be deposited promptly into the Revenue Fund. (E) Excess Funds. Subject to the provisions for the disposition of revenues in paragraphs (C) and (D), which are cumu- lative, the Issuer shall, on or before the 15th day of each month, transfer to the Reserve Account in the Sinking Fund the balance of money remaining in the }revenue Fund until the funds and investments III t11e Reserve Account equal the amount of Twenty-four Thousand Dollars ($24,000.00), and thereafter whenever funds and investments in t11e Reserve Account equal. Twenty -.four T11011sand Dollars ($24,000.00) 111e issuer may use the sut:pluS fund:; in the Revenue Fund for the -17- purchase or redemption of Bonds or for any other lawful municipal purpose. (F) Trust fund,. The funds and accounts created and established by this instrument shall constitute trust funds for the purpose provided herein for such funds. All of such funds, except as hereinafter provided, shall be continuously secured in the same manner as deposits of public funds are required to be secured by the Laws of the State of Florida, Money on deposit to the credit of the Reserve Account shall be invested by the deposi- tory bank, upon request by the Issuer, in direct obligations of, or obligations the principal of and interest on which are guaranteed by the United States of America and which shall be subject to redemp- tion at face value at any time by the holder thereof at the option of such holder; and the money on deposit to the credit of the Sinking Fund may be so invested in such obligations which shall mature not later than fifteen (15) days prior to the date on which such money shall be needed to pay the principal of and interest on the Bonds in the manner herein provided, but money on deposit to the credit of the Revenue fund and the Operation and Maintenance fund shall not be invested at any time. The securities so purchased as an investment of funds shall be deemed at all times to be a part of the account from which the investment was withdrawn, and the interest accruing thereon and any profit realized therefrom shall be credited to such account and any loss resulting from such investment shall likewise be charged to such account. (G) Rates and Chartres. The Issuer covenants and agrees.to maintain and collect, so long as any of the Bonds are outstanding, such schedule of rates and charges for the services and facilities of the System which will produce revenues which shall be sufficient to provide for current debt service and reserve requirements for the Bonds and pay the reasonable expenses of opera- tion and maintenance of the system; and the Issuer covenants and agrees that so long as any of the Bonds are outstanding and unpaid, at the same time and in like manner that the Issuer prepare- its annual b6dgot• of the oper.atinc, Ixpen�c:, the I.suor shill. annually prepare an e:,timate of groat, revenues to he derived from the opera- 0 OR 40 0 tion of the System for the ensuing fiscal Year, and to the extent that such gross revenues are insufficient to pay debt service re- quirements during such ensuing year on all outstanding Bonds payable from the revenues of the System, build up and maintain the required reserves for all such outstanding Bonds and pay Operating Expenses, the Issuer shall revise the fees and rates charged for the use of the services and facilities of the System sufficiently to provide the funds required. (1I) Issuance of Other. Obligations. (1) The Issuer covenants and agrees tPat in the event the cost of construction or completion of the Project shall. exceed the dollar amount of Bonds herein authorized, it shall deposit into the Construction Account the amount of such excess out of .funds available to it for such purpose, and the Issuer may pro- vide such excess, and only such excess, through the issuance of parity Bonds conforming to the requirements of paragraph (3) of this subsection; but except to complete the Project, it will not issue any other obligations payable from or secured by the rev- enues of the System, unless the conditions hereinafter set forth shall be met, or unless the lien of such obligations is junior and .subordinate in all respects to the lien of the Bonds. (2) The Issuer shall have the right to add new water or sewer facilities and related auxiliary facilities, by the issuance of one or more additional series of bonds to be secured by a parity lien on and ratably payable from the gross revenues of the System, provided in each instance that: (a) The facility or facilities to be built from the proceeds of the additional parity bonds is or are made a part of the System and its or their revenues are pledged as additional security for the additional parity bonds and the outstanding Bonds. (b) The Issuer is in compliance with all covenants and undertakings in connection with all of its Bonds then out- standing and payable from the revenues of the system, or. any part thereof, and has not been in default a: to any payments _19•- required to be made under this instrument for a period of at least the next preceding 24 months, or if at such time the Bonds shall not have been outstanding for 24 months, then for the period that the Bonds shall have been outstanding. (c) The annual net revenues for the Fiscal Year next preceding the issuance of additional parity bonds are certified by • an independent certified public accountant not regularly employed by the Issuer, to have been equal.to at least one and twenty -hundredths (1.20) times the average annual requirements for principal and interest on all the Bonds then outstanding and payable from such pledged revenues. (d) The estimated average annual net revenues of the facility or facilities to be constructed and acquired with the proceeds of such additional bonds (and any other funds pledged and set aside for such purpose), when added to the estimated future average annual net revenues of the then existing System shall be at least one and twenty -hundredths (1.20) times the average annual debt service requirements for principal and interest on all outstanding Bonds payable from the revenues of the System and on the additional bonds proposed to be issued. Estimates of future revenues and operating expenses shall be furnished by recognized independent consulting engineers and approved by the Board of County Commis- sioners of the Issuer, and shall be forecast over a period of not exceeding, ten years from the date of the additional bonds proposed to be issued. Provided, however, the conditions provided by this paragraph and by the next preceding paragraph (c) may be waived or modified by the written consent of the holders of seventy-five per centum (75.) of the Bonds then outstanding. (3) The Issuer hereby covenants and agrees that in the event additional series of parity bonds are issued, it will provide that the parity bonds shall mature according to a schedule which most closely approximates equal annual installments of com- bined principal and interest payments for such parity bonds and all other Bonds payable from the revenues of the System; it will adjust the required deposits into and the maximum amount to be maintained in the Sinking Fund, includinc] the Reserve Account therein, on the -20-- same basis as hereinabove prescribed, to reflect the average annual debt service on the additional bonds; and it will make such addi- tional bonds payable as to principal on September 1 of each year in which principal falls due and the coupons attached thereto payable on September 1 of each year. If in any subsequently issued series of bonds secured by a parity lien on the revenuer of.• the System, it is provided that excess revenues shall be used to redeem bonds in advance of scheduled maturity, or if the Issuer at its option undertakes to redeem outstanding bonds in advance of scheduled maturity, the Issuer covenants that calls of bonds will be applied to each series of bonds on an equal pro rata basis (reflecting the proportion that the amount originally issued of each series bears to the amount originally issued of each of the other series) to the extent that this may be accomplished in accordance with the call provisions of the respective bond series, but the Issuer shall have the right to call any or all outstand- ing bonds which may be called at par prior to calling any bonds that are callable at a premium. (I). Disposal of Facilities. The Issuer covenants and agrees that, so long as any of the Bonds are outstanding, it will maintain its corporate identity and existance and will not sell or otheniise dispose of any of the System facilities or any part thereof, and, except as provided for above, it will not create or permit to be created any charge or lien on the revenues thereof ranking equal or prior to the charge or lien of the Bonds. Notwithstanding the foregoing, the Issuer may at any time per- manently abandon the use of, or sell at fair market value, any Of its System facilities, provided that: (a) It. is in compliance with all covenants and under- takings in connection with all of its Bonds then outstanding and payable from the revenues of the System, and the debt service reserve for such Bond; has been fully established; (b) It Will, in the event of sale, apply the proceeds to either (1) redemption of outstanding Bonds .in accordance with the provision; governing paynu nt of: Bonds in advance of maturity, -21- rJ or (2) replacement of the facility so disposed of by another ® facility the revenues of which shall be incorporated into the System as hereinbefore provided; • (c) It is certified, prior to any abandonment of use, that the facility to be abandoned is no longer economically • feasible of producing net revenues; and (d) It certified that the estimated net revenues of the remaining System facilities for the next succeeding fiscal Year, plus the estimated net revenues of the facility, if any, to be added to the System, satisfy the earnings test hereinbefore provided in the Section governing issuance of additional parity bonds. (J) Insurance on System. While any of the Bonds shall remain outstanding, the Issuer shall carry at least the following insurance coverage: (1) Fire and extended coverage on the insurable portions of the System, in amounts sufficient to provide for not less than full recovery whenever a loss from perils insured against does not exceed eighty per centum .(80%) of the full insurable value of the damaged facility; and flood damage insurance shall be car- ried to the full insurable value, as recommended by consulting engineers, of all property of the System which may be subject to flood damage and shall be situated in a flood plain area. (2) Public liability insurance relating to the operation of the System, with limits of not less than $100,000 for one person and $.300,000 for more than one person involved in one accident, to protect the Issuer from claims for bodily injury and/or death, and not..less than $10,000 for claims for damage to property of others which may arise from the Issuer's operation of the System. (3) If the Issuer owns or operates a vehicle in the operation of the System, vehicular public liability insurance with limits of not less than $100,000 for one person and $300,000 for more than one person involved in one accident to protect the Issuer from claims for bodily injury and death, and not less than $10,000 against claims for damage to property of: others which may arise from the Issuer's operation of vehicles. -22- All such insurance shall be carried for the benefit of the holders of the Bonds. All money received by the Issuer by reason of insurance coverage, except liability coverage, shall be deposited to the credit of the Reserve: Account and is hereby pledged by the Issuer as security for the Bonds, until and unless such proceeds are used to remedy the loss or damage for which such proceeds are re- ceived, either by repairing the property damaged or replacing the property destroyed within ninety (90) days from the receipt of such proceeds. (K) Maintenance of Svstem. The Issuer will complete the construction of the Project in an economical and efficient manner with all practicable dispatch, and thereafter will maintain the System in good condition and continuously operate the same in an efficient manner and at a reasonable cost. (I,) No Free Services. The Issuer will not render or cause to be rendered any free services of any nature by its System, nor will any preferential rates be established for users of the same class; and if the Issuer shall avail itself of the facilities or services provided by the System, or any part thereof, then the same rates, fees or charges applicable to other customers receiving like service under similar circumstances shall be charged to the Issuer. Such charges shall be paid as they accrue, and the Issuer shall transfer from its general funds sufficient sums to pay such charges. The revenues so received shall be deemed to be revenues derived from the operation of the System, and shall be deposited and accounted for in the same manner as other revenues derived from such operation of the System. (M) Failure of User. to Pav for Services. Upon failure of any user of any product, services or facilities of the System to pay for the same within sixty (60) days after. the Issuer shall have billed such user therefor, the Issuer shall shut off the connection of such user and shall not furnish him or permit him to receive from the System further service until all obli- gations owed by him to the Issuer on account: of servic_c, including -23- • disconnection and reconnection charges, shall have been paid in • full. This covenant shall not, however, prevent the Issuer .from causing any System connection to be shut off sooner. ® (N) Enforcement of Collections. The Issuer will Bili - gently enforce and collect the rates, fees and other charges for the services and facilities of the System; and will take all steps, actions and proceedings for the enforcement and collection of such rates, charges and fees as shall become delinquent to the full extent permitted or authorized by law; and will maintain accurate records with respect thereof. All such fees, rates, charges and revenues herein pledged shall, as collected, be held in trust to be applied as provided in this instrument and not otherwise. (0) Sufficiency of Rates. The Issuer covenants and agrees that it will fix, establish, revise from time to time whenever necessary and maintain always such fees, rates, rentals and other charges for the use of the product, services and facilities of the System which will always produce cash revenues sufficient to pay, and out of such funds pay, as the same shall become due, the principal of and interest on the Bonds, the nec- essary expenses of operating and maintaining the System and all reserve, Sinking Fund or other payments required by this instrument; and that such rates, fees, rentals or other charges will not be reduced so as to be insufficient to provide funds for such purposes. (P) Compliance with Laws and Regulations. The Issuer covenants and agrees to perform and comply with, in every respect, the Loan and Grant Agreements which it might have with the Government or with any other governmental agency, and all applicable Federal and State Laws and regulations. (�) Remedies. Any holder of the Bonds or any coupons appertaining thereto issued under the provisions of this instru- ment, or any trustee acting for the holders of such Bonds and coupons, 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 right., including the right to the appointment of a receiver, existin<T under the Laws of the -24- State of Florida, or granted and contained in this instrument, and may enforcr_ and compel the performance of all duties re- quired by this instrument or by any applicable State or Federal statutes to be performed by the Issuer or by any officer thereof. Nothing herein, however, shall be construed to grant to • any holder of such Bonds or coupons any lien on any real property Of the Issuer. (R) Records and Audits. The Issuer shall keep books and records of the revenues of the System, which such books and records shall be kept separate and apart from all other books, records and accounts of the Issuer, and any holder of a Bond or Bonds or the coupons applicable thereto issued pursuant to this .instrument shall have the right to, at all reasonable times, inspect all records, accounts and data of the Issuer relating thereto. So long as any of the Bonds shall be outstanding, the Issuer will furnish on or before ninety (9 0) days after the close of each Fiscal Year, to any bondholder who shall request the same in writing, copies of any annual audit report prepared by an independent certified public accountant or an auditing official of the State of Florida, covering for the preceding Fiscal Year, in reasonable detail, the financial condition and record of operation of the System and any other facilities the revenues of which are pledged to the payment of the Bonds. (S) Connection with System. The Issuer will, to the full extent permitted by law, require all lands, buildings, residences and structures within its corporate limits which can use the facilities and services of the System to connect there- with and use the facilities and services thereof and to cease the use of all other facilities. The Issuer will not grant a franchise for the operation of any competing water or sewer System until all Bonds issued hereunder, together with interest thereon, shall have been paid in full. (T) Fidelity Bond. The Issuer will require each employee who may have possession of the revenues of the System to be covered by a fidelity bond written by a responsible indemnity company in an -2- amount fully adequate to protect the Issuer from loss. (U) Government Approval of Extensions and L•'inancing. Anything herein to the contrary notwithstanding, while the Government is the holder of any of the Bonds, the Issuer will not borrow any money from .any source or enter into any contract or agreement or incur any other liability in connection with making extensions or improvements other than normal maintenance of the System, or make .any extensions or enlargements of the System, or permit others to do so, without obtaining the prior written consent of the Government. (V) Reimbursement of Advances and Interest Thereon. While the Government shall. be the holder of any of the Bonds, the Government shall have the right to make advances for the payment of insurance premiums and/or other advances which, in the opinion of the Government, may be required to protect the Government's security interest. In the event of any such advances, the Issuer covenants and agrees to repay the same, together with interest thereon at the same rate per annum as specified in the Bonds, upon demand made at any time after any such expenditure by the Government. Any such amount due the Government shall take priority over any other payments from the Reserve Account. -20- ARTICLE IV MISCELLANEOUS PROVISIONS 4.01. Modification or. Amendment. No material modifi- cation or amendment of this instrument or of any instrument amendatory hereof or supplemental hereto, may be made without 0 the consent in writing of the holders of two-thirds or more in principal amount of the Bonds then outstanding; provided, 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 in the amount of the principal obligation, or affect the unconditional promise of the Issuer to charge and collect such rates, fees and charges for the use of the product, services and facilities of the System and apply the same as herein provided, or reduce the number of such Bonds the written consent of the holders of which are required by this Section for such modifi- cations or amendments, without the consent of the holders of all. such Bonds. 4.02 Creation of Superior Liens. The Issuer covenants that except as herein provided it will not issue any other Bonds, certificates or obligations of any kind or nature or create or cause or permit to be created any debt, lien, pledge, assignment or encumbrance or charge payable from or enjoying a lien upon the revenues of the System ranking prior and superior to the lien created by this instrument for the benefit of the Bonds. 4.03 Severability of Invalid Provisions. If any one or more of the covenants, agreements or provisions of this instrument or of the Bonds should be held contrary to any express pi:uvision 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, agreement:-- or pro- visions of this instrument and of the Bonds. 4.04 Val.i(lat-Jon Authorized. The I :suet's Attorney is hereby authorized and directed to institute appropriate proecedincl:: -27- in the Circuit Court for Indian River County, Florida, for the valida- tion of the Bonds. 4.05 Sale of Bonds. The Bonds are hereby sold and awarded to the Government at the price of par and bearing interest at the rate of five per centum (52) per annum. 4.06 Conflicts Repealed. All resolutions or parts of resolutions in conflict herewith are hereby repealed. 4.07 Effective bate. This instrument shall take effect immediately upon its passage. Adopted: January 23, 1978 2 St i EXTRACTS Pit04,-1 'rilE• til :fU'1'I::S OF A Special MEETIt1G OF THE Board of County Co:mnissioners OF Indian River County, Florida HELD ON THE 23rd DAY OF January � W, 19 78 The Board of County Commissioners of Indian River County, Florida met in Special meeting at Indian River County Courthouse in the City of Vero Beach _ Florida at 9:00 o'clock A .M. on the 23rd day of January 19 78, the place, hour, and date duly established for the hold- ing of such meeting. The Chairman called the meeting to order and on roll call the following answered present: T3 d 7 7 :...., n' f.r..A+-La Tr• - Alma Lee Loy Edwin S. Schmucker R. Don Deelon and the Following were absent: Willard W. Siebert, Jr. The. -Chairman declared a quorur.. present. A Resolution entitled: RESOLUTION NO. 78-6 Resolution providing for the acquisition of a water and sewer system in Indian River County, Florida, and the construction and erection of extensions and improvements thereto; authorizing the issuance by the County of not exceeding $402,500 water and sewer revenue bonds, series 1979, to finance a part of the cost_ thereof; pledging the gross revenues of such system to secure payment of the principal of and interest on the bonds; and providing for the rights of the'holders of the bonds. was introduced by Mr. William C: Wodtke, Jr. Said Resolution was thon read in full cnd discussed and considered. The Chairman thereupon declared the motion carried and the Resolution adopted as introduced and read. There being no further business to come before the meeting, upon motion duly made and seconded, the meeting was adjourned. / s Hips Alma Lee Loy then moved the adoption of the Resolution I as introduces] and read. Mr. Schmucker seconded the motion, and, on roll call, the following voted "Aye": R. Don Deeson, Edwin S. Schmucker, Alma Lee Loy and William C. 40 Wodtke, Jr. i and the following voted "Nay": None The Chairman thereupon declared the motion carried and the Resolution adopted as introduced and read. There being no further business to come before the meeting, upon motion duly made and seconded, the meeting was adjourned.