HomeMy Public PortalAbout2004-42 Authorizing the issuance of Land Acquisition and Capital Improvement Revenue BondsRESOLUTION NO. 2004-42
A RESOLUTION OF THE VILLAGE OF KEY BISCAYNE,
FLORIDA, AUTHORIZING THE ISSUANCE OF LAND
ACQUISITION AND CAPITAL IMPROVEMENT REVENUE
BONDS, SERIES 2004, OF THE VILLAGE OF KEY
BISCAYNE, FLORIDA, IN THE AGGREGATE PRINCIPAL
AMOUNT OF $2,800,000 FOR THE PURPOSE OF
REIMBURSING THE PROJECT FUND FOR COSTS OF
ACQUIRING LAND LOCATED AT 530 CRANDON
BOULEVARD (THE FORMER CITGO STATION SITE) FOR
VILLAGE PURPOSES; FINANCING A PORTION OF THE
COSTS OF SITE IMPROVEMENTS FOR THE VILLAGE'S
CIVIC CENTER, FINANCING ARCHITECTURAL,
ENGINEERING, ENVIRONMENTAL, LEGAL AND OTHER
PLANNING COSTS RELATED THERETO, AND PAYING
COSTS OF ISSUANCE OF THE BONDS; AWARDING THE
SALE OF THE BONDS TO SUNTRUST BANK; PROVIDING
FOR SECURITY FOR THE BONDS; PROVIDING OTHER
PROVISIONS RELATING TO THE BONDS; MAKING
CERTAIN COVENANTS AND AGREEMENTS IN
CONNECTION THEREWITH; AND PROVIDING AN
EFFECTIVE DATE.
WHEREAS, on April 23, 2002, the Village Council (the "Council") of the Village of Key
Biscayne, Florida (the "Village") adopted Ordinance No. 2002-2 ("Ordinance 2002-2") authorizing
the issuance of not exceeding $1,500,000 of revenue bonds or bond anticipation notes for the
purpose of financing a portion of the costs of acquiring land located at 530 Crandon Boulevard (the
former Citgo Station site) (the "Property") for Village purposes, financing architectural, engineering,
environmental, legal and other planning costs related thereto, and paying costs of issuance of the
bonds or notes; and
WHEREAS, subsequently the Village acquired the Property for $1,800,000 in cash; and
WHEREAS, on August 31, 2004, the Council adopted Ordinance No. 2004-8 ("Ordinance
2004-8," and, together with Ordinance 2002-2, the "Ordinance") authorizing the issuance of (a) an
additional $300,000 of bonds or notes to reimburse the project fund for the purchase of the Property
and (b) not exceeding $1,000,000 of bonds or notes for the purpose of financing a portion of the
costs of site improvements for the Village's civic center, and financing architectural, engineering,
environmental, legal and other planning costs related thereto, and paying costs of issuance of the
bonds or notes (collectively, the "Project"); and
WHEREAS, pursuant to the Ordinance, the Village has solicited proposals for the financing
of the Project; and
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WHEREAS, the Council hereby determines to accept a commitment (the "Commitment")
from SunTrust Bank (the "Bank") to purchase the Bonds; and
WHEREAS, the Council desires to set forth the details of the Bonds in this Bond
Resolution;
NOW, THEREFORE, BE IT RESOLVED BY THE VILLAGE COUNCIL OF THE
VILLAGE OF KEY BISCAYNE, FLORIDA:
SECTION 1. AUTHORIZATION OF BONDS. Pursuant to the provisions of this Bond
Resolution and the Ordinance, land acquisition and capital improvement revenue bonds of the
Village to be designated "Village of Key Biscayne, Florida Land Acquisition and Capital
Improvement Revenue Bonds, Series 2004" (the "Bonds"), are hereby authorized to be issued in an
aggregate principal amount of $2,800,000 for the purpose of reimbursing the project fund for costs
of acquiring land located at 530 Crandon Boulevard (the former Citgo Station site) for Village
purposes, financing a portion of the costs of site improvements for the Village's civic center,
financing architectural, engineering, environmental, legal and other planning costs related thereto,
and paying costs of issuance of the Bonds.
SECTION 2. TERMS OF THE BONDS.
(a) General Provisions. The Bonds shall be issued in fully registered form
without coupons. The principal of and interest on the Bonds shall be payable when due in lawful
money of the United States of America by wire transfer or by certified check delivered on or prior
to the date due to the registered Owners of the Bonds ("Owners") or their legal representatives at the
addresses of the Owners as they appear on the registration books of the Village. Payments shall be
made in immediately available funds by no later than 2:00 p.m. on the date due, free and clear of any
defenses, set -offs, counterclaims, or withholdings or deductions for taxes.
The Bonds shall be dated the date of their issuance and delivery and shall be initially issued
as one Bond in the denomination of $2,800,000. The Bonds shall mature on November 1, 2022.
THE BONDS SHALL NOT BE DEEMED TO CONSTITUTE AN INDEBTEDNESS OF
THE VILLAGE OR A PLEDGE OF THE FAITH AND CREDIT OF THE VILLAGE, BUT SHALL
BE PAYABLE EXCLUSIVELY FROM LEGALLY AVAILABLE NON -AD VALOREM
REVENUES OF THE VILLAGE, AS DEFINED IN THIS RESOLUTION. THE ISSUANCE OF
THE BONDS SHALL NOT DIRECTLY OR INDIRECTLY OR CONTINGENTLY OBLIGATE
THE VILLAGE TO LEVY OR TO PLEDGE ANY FORM OF TAXATION WHATEVER
THEREFOR NOR SHALL THE BONDS CONSTITUTE A CHARGE, LIEN, OR
ENCUMBRANCE, LEGAL OR EQUITABLE, UPON ANY PROPERTY OF THE VILLAGE,
AND THE HOLDERS OF THE BONDS SHALL HAVE NO RECOURSE TO THE POWER OF
TAXATION.
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(b) Interest Rate. Subject to adjustment as provided below, the Bonds shall bear
interest on the outstanding principal balance from their date of issuance payable quarterly on the first
day of each February, May, August and November (the "Interest Payment Dates"), commencing
February 1, 2005, at an interest rate equal to 3.83% per annum to but not including November 1,
2012 (the "Initial Interest Rate Period"). Commencing on November 1, 2012 through the maturity
date of the Bonds (the "Second Interest Rate Period"), the interest rate shall be adjusted to a rate
equal to (A) the ten-year Federal Reserve interest rate swap rate (the "Index Rate"), plus 110 basis
points, divided by (B) 1.5054 (such divisor, however, being subject to adjustment if any of the events
specified in this Section (2)(b) (i) through (iv) occurs, so as to provide the Owners of the Bonds the
same after-tax yield they would otherwise have had in the absence of such occurrence) (the "New
Interest Rate"). The "Index Rate" is currently published at the website:
http ://federalreserve.gov/releases/h15/update/.
Interest on the Bonds shall be computed on the basis of a 360 -day year based on twelve 30 -
day months.
(i) Adjustment of Interest Rate For Full Taxability. In the event a
Determination of Taxability shall have occurred, the rate of interest on the Bonds
shall be increased to a rate per annum equal to 5.8982%, and in the event a
Determination of Taxability shall have occurred during the Second Interest Rate
Period, the rate of interest on the Bonds shall be increased to a rate per annum equal
to the New Interest Rate times 1.54 (the "Taxable Rate"), effective retroactively to
the date on which the interest payable on the Bonds is includable for federal income
tax purposes in the gross income of the Owners thereof. In addition, the Owners of
the Bonds or any former Owners of the Bonds, as appropriate, shall be paid an
amount equal to any additions to tax, interest and penalties, and any arrears in interest
that are required to be paid to the United States by the Owners or former Owners of
the Bonds as a result of such Determination of Taxability. All such additional
interest, additions to tax, penalties and interest shall be paid by the Village on the
next succeeding Interest Payment Date following the Determination of Taxability.
A "Determination of Taxability" shall mean (i) the issuance by the Internal Revenue
Service of a statutory notice of deficiency or other written notification which holds
in effect that the interest payable on the Bonds is includable for federal income tax
purposes in the gross income of the Owners thereof, which notice or notification is
not contested with the Internal Revenue Service by either the Village or any Owners
of the Bonds, or (ii) a determination by a court of competent jurisdiction that the
interest payable on the Bonds is includable for federal income tax purposes in the
gross income of the Owners thereof, which determination either is final and non -
appealable or is not appealed within the requisite time period for appeal, or (iii) the
admission in writing by the Village to the effect that interest on Bonds is includable
for federal income tax purposes in the gross income of the Owners thereof, or (iv)
receipt by the Village of an opinion of bond counsel to the Village to the effect that
interest on the Bonds is includable for federal income tax purpose in the gross
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income of the Owners thereof.
(ii) Adjustment of Interest Rate for Partial Taxability. In the event that
interest on the Bonds during any period becomes partially taxable as a result of a
Determination of Taxability applicable to less than all of the Bonds, then the interest
rate on the Bonds shall be increased during such period by an amount equal to: (A -B)
x C where:
(a) A equals the Taxable Rate (expressed as a percentage);
(b) B equals the interest rate on the Bonds (expressed as a
percentage); and
(c) C equals the portion of the Bonds the interest on which has
become taxable as the result of such tax change (expressed as
a decimal).
In addition, the Owners of the Bonds or any former Owners of the Bonds, as
appropriate, shall be paid an amount equal to any additions to tax, interest and
penalties, and any arrears in interest that are required to be paid to the United States
by the Owners or former Owners of the Bonds as a result of such Determination of
Taxability. All such additional interest, additions to tax, penalties and interest shall
be paid by the Village on the next succeeding Interest Payment Date following the
Determination of Taxability.
(iii) Adjustment of Interest Rate for Change in Maximum Corporate Tax
Rate. In the event that the maximum effective federal corporate tax rate (the
"Maximum Corporate Tax Rate") during any period with respect to which interest
shall be accruing on the Bonds on a tax-exempt basis, shall be other than thirty-five
percent (35%), the interest rate on the Bonds that are bearing interest on a tax-exempt
basis shall be adjusted to the product obtained by multiplying the interest rate then
in effect on the Bonds by a fraction equal to (1-A divided by 1-B), where A equals
the Maximum Corporate Tax Rate in effect as of the date of adjustment and B equals
the Maximum Corporate Tax Rate in effect immediately prior to the date of
adjustment.
(iv) Adjustment of Interest Rate for Other Changes Affecting After -Tax
Yield. So long as any portion of the principal amount of the Bonds or interest
thereon remains unpaid (a) if any law, rule, regulation or executive order is enacted
or promulgated by any public body or governmental agency which changes the basis
of taxation of interest on the Bonds or causes a reduction in yield on the Bonds (other
than by reason of a change described above) to the Owners or any former Owners of
the Bonds, including without limitation the imposition of any excise tax or surcharge
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thereon, or (b) if, as a result of action by any pubic body or governmental agency, any
payment is required to be made by, or any federal, state or local income tax deduction
is denied to, the Owners or any former Owners of the Bonds (other than by reason of
a change described above or by reason of any action or failure to act on the part of
any Owner or any former Owner of the Bonds) by reason of the ownership of the
Bonds, the Village shall reimburse any such Owner within five (5) days after receipt
by the Village of written demand for such payment, and the Village agrees to
indemnify each such Owner against any loss, cost, charge or expense with respect to
any such change. The determination of the after-tax yield calculation shall be
verified by a firm of certified public accountants regularly employed by the Bank (or
the current Owner of the Bonds) and acceptable to the Village, and such calculation,
in the absence of manifest error, shall be binding on the Village and the Owners.
(c) Prepayment Provisions.
(i) Mandatory Prepayment. The principal of the Bonds shall be subject
to mandatory prepayment in quarterly annual installments on each Interest Payment
Date, commencing August 1, 2005 (each a "Scheduled Due Date"). The schedule of
principal and interest payments due on each Scheduled Due Date shall be determined
on April 30, 2005, after the last Advance (as defined in Section 10(e) hereof) has
been made in accordance with Section 10(a) hereof. The schedule shall be
determined based upon a seventeen and one-half (17.5) year amortization schedule
of substantially level payments of principal and interest, with payments of principal
and interest sufficient to fully amortize so much of the principal amount of the Bonds
as has been Advanced hereunder, with the final payment due and payable on
November 1, 2022.
In the event that there is more than one Owner of the Bonds, (A) the Village
shall determine the amount of each Bond to be redeemed, and (B) the Village shall
give notice to each Owner of the Bonds at least three (3) days prior to the date of
mandatory redemption of the amount of each Bond to be redeemed.
(ii) Optional Prepayment. The Bonds are subject to optional prepayment,
upon thirty (30) days written notice to the Bank, in whole or in part at any time at par,
plus accrued interest to the date of prepayment.
SECTION 3. EXECUTION OF BONDS. The Bonds shall be signed in the name of the
Village by the Mayor or Vice Mayor (or, in their absence, any other member of the Village Council)
and the Village Clerk, and its seal shall be affixed thereto or imprinted or reproduced thereon. The
signatures of the Mayor or Vice Mayor (or, in their absence, any other member of the Village
Council) and Village Clerk on the Bonds may be manual or facsimile signatures, provided that the
signature of one of such officers shall be a manual signature. In case any one or more of the officers
who shall have signed or sealed any of the Bonds shall cease to be such officer of the Village before
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the Bonds so signed and sealed shall 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
and sealed such Bonds had not ceased to hold such office. Any Bonds may be signed and sealed on
behalf of the Village by such person as at the actual time of the execution of such Bonds shall hold
the proper office, although at the date of such Bonds such person may not have held such office or
may not have been so authorized.
SECTION 4. NEGOTIABILITY. REGISTRATION AND CANCELLATION. The Village
shall serve as Registrar and as such shall keep books for the registration of Bonds and for the
registration of transfers of Bonds. Bonds may be transferred or exchanged upon the registration
books kept by the Village, upon delivery to the Village, together with written instructions as to the
details of the transfer or exchange, of such Bonds in form satisfactory to the Village and with
guaranty of signatures satisfactory to the Village, along with the social security number or federal
employer identification number of any transferee and, if the transferee is a trust, the name and social
security or federal tax identification numbers of the settlor and beneficiaries of the trust, the date of
the trust and the name of the trustee. Bonds may be exchanged for one or more Bonds of the same
aggregate principal amount and maturity and in denominations in integral multiples of $250,000
(except that an odd lot is permitted to complete the outstanding principal balance). No transfer or
exchange of any Bond shall be effective until entered on the registration books maintained by the
Village.
The Village may deem and treat the person in whose name any Bond shall be registered upon
the books kept by the Village as the absolute Owner of such Bond, whether such Bond shall be
overdue or not, for the purpose of receiving payment of, or on account of, the principal of and
interest on such Bond as they become due and for all other purposes. All such payments so made to
any such Owner or upon his order shall be valid and effectual to satisfy and discharge the liability
upon such Bond to the extent of the sum or sums so paid.
In all cases in which Bonds are transferred or exchanged in accordance with this Section, the
Village shall execute and deliver Bonds in accordance with the provisions of this Resolution. All
Bonds surrendered in any such exchanges or transfers shall forthwith be cancelled by the Village.
There shall be no charge for any such exchange or transfer of Bonds, but the Village may require the
payment of a sum sufficient to pay any tax, fee or other governmental charge required to be paid with
respect to such exchange or transfer. The Village shall not be required to transfer or exchange Bonds
for a period of 15 days next preceding an Interest Payment Date on such Bonds.
All Bonds, the principal and interest of which has been fully paid, either at or prior to
maturity, shall be delivered to the Village when such payment is made, and shall thereupon be
cancelled.
In case a portion but not all of an outstanding Bond shall be prepaid, such Bond shall not be
surrendered in exchange for a new Bond, but the Village shall make a notation indicating the
remaining outstanding principal of the Bonds upon the registration books. The Bond so redesignated
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shall have the remaining principal as provided on such registration books and shall be deemed to
have been issued in the denomination of the outstanding principal balance, which shall be an
authorized denomination.
SECTION 5. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any
Bond shall become mutilated or be destroyed, stolen or lost, the Village may in its discretion issue
and deliver a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in the case
of a mutilated Bond, in exchange and substitution for such mutilated Bond upon surrender of such
mutilated Bond or in the case of a destroyed, stolen or lost Bond in lieu of and substitution for the
Bond destroyed, stolen or lost, upon the Owner furnishing the Village proof of his ownership thereof,
satisfactory proof of loss or destruction thereof and satisfactory indemnity, complying with such
other reasonable regulations and conditions as the Village may prescribe and paying such expenses
as the Village may incur. The Village shall cancel all mutilated Bonds that are surrendered. If any
mutilated, destroyed, lost or stolen Bond shall have matured or be about to mature, instead of issuing
a substitute Bond, the Village may pay the principal of and interest on such Bond upon the Owner
complying with the requirements of this paragraph.
Any such duplicate Bonds issued pursuant to this section shall constitute original, additional
contractual obligations of the Village whether or not the lost, stolen or destroyed Bonds be at any
time found by anyone, and such duplicate Bonds shall be entitled to equal and proportionate benefits
and rights as to lien on and source and security for payment from the funds, as hereinafter pledged,
to the extent as all other Bonds issued hereunder.
SECTION 6. FORM OF BONDS. The text of the Bonds shall be of substantially the tenor
set forth in Exhibit "A" hereto, with such omissions, insertions and variations as may be necessary
and desirable and authorized or permitted by this Resolution.
SECTION 7. COVENANT TO BUDGET AND APPROPRIATE. The Village hereby
covenants and agrees to appropriate in its annual budget, by amendment, if necessary, from Non -Ad
Valorem Revenues (as defined in this Section) lawfully available in each fiscal year, amounts
sufficient to pay the principal and interest due on the Bonds in accordance with their terms during
such fiscal year. "Non -Ad Valorem Revenues" means all revenues of the Village derived from any
source other than ad valorem taxation on real or personal property and which are legally available
to make the payments required under this Resolution, other than (i) Public Service Taxes authorized
by Part III, Chapter 166, Florida Statutes, and received by the Village pursuant to Section 25-50 et
seq. of the Village Code and (ii) Stormwater Utility Fees as defined by Section 403.0893(3), Florida
Statutes, and imposed pursuant to Ordinance No. 93-11 adopted by the Village Council on June 22,
1993 (as amended by Ordinance No. 93-11-A); but only after provision has been made by the Village
for the payment of all essential or legally mandated services not otherwise provided for by ad
valorem taxes. Such covenant and agreement on the part of the Village to budget and appropriate
such amounts of Non -Ad Valorem Revenues shall be cumulative to the extent not paid, and shall
continue until such Non -Ad Valorem Revenues or other legally available funds in amounts sufficient
to make all such required payments shall have been budgeted, appropriated and actually paid.
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Notwithstanding the foregoing covenant of the Village, the Village does not covenant to maintain
any services or programs, now provided or maintained by the Village, which generate Non -Ad
Valorem Revenues.
Such covenant to budget and appropriate does not create any lien upon or pledge of such
Non -Ad Valorem Revenues, nor does it preclude the Village from pledging in the future its Non -Ad
Valorem Revenues, nor does it require the Village to levy and collect any particular Non -Ad
Valorem Revenues, nor does it give the Bondholders a prior claim on the Non -Ad Valorem
Revenues as opposed to claims of general creditors of the Village. Such covenant to appropriate
Non -Ad Valorem Revenues is subject in all respects to the payment of obligations secured by a
pledge of such Non -Ad Valorem Revenues heretofore or hereinafter entered into (including the
payment of debt service on bonds and other debt instruments). However, the covenant to budget and
appropriate in its general annual budget for the purposes and in the manner stated herein shall have
the effect of making available in the manner described herein Non -Ad Valorem Revenues and
placing on the Village a positive duty to appropriate and budget, by amendment, if necessary,
amounts sufficient to meet its obligations under this Resolution, subject, however, in all respects to
the terms of this Resolution and the restrictions of Section 166.241(3), Florida Statutes, which
provides, in part, that the governing body of each municipality make appropriations for each fiscal
year which, in any one year, shall not exceed the amount to be received from taxation or other
revenue sources; and subject, further, to the payment of services and programs which are for
essential public purposes affecting the health, welfare and safety of the inhabitants of the Village or
which are legally mandated by applicable law.
SECTION 8. BOND FUND. There is hereby created a fund entitled "Village of Key
Biscayne, Florida Land Acquisition and Capital Improvement Revenue Bonds, Series 2004 Bond
Fund" (the "Bond Fund"). There shall be deposited into the Bond Fund on each Interest Payment
Date sufficient amounts of Non -Ad Valorem Revenues as specified in Section 7 hereof which,
together with the amounts already on deposit therein, will enable the Village to pay the principal of
and interest on the Bonds on each Interest Payment Date. Moneys in the Bond Fund shall be applied
on each Interest Payment Date to the payment of principal of and interest on the Bonds coming due
on each such date.
SECTION 9. INVESTMENT OF BOND FUND. Subject to Section 12 hereof, funds in the
Bond Fund may be invested in the following investments, maturing at or before the time such funds
may be needed to pay principal of or interest on Bonds, to the extent such investments are legal for
investment of municipal funds ("Authorized Investments"):
(a) The Local Government Surplus Funds Trust Fund;
(b) Negotiable direct obligations of, or obligations the principal of and interest
on which are unconditionally guaranteed by, the United States Government at the then
prevailing market price for such securities;
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(c) Interest -bearing time deposits or savings accounts in banks organized under
the laws of the State of Florida (the "State"), in national banks organized under the laws of
the United States and doing business and situated in the State, in savings and loan
associations which are under State supervision, or in federal savings and loan associations
located in the State and organized under federal law and federal supervision, provided that
any such deposits are secured by collateral as may be prescribed by law;
(d) Obligations of the federal farm credit banks; the Federal Home Loan
Mortgage Corporation, including Federal Home Loan Mortgage Corporation participation
certificates; or the Federal Home Loan Bank or its district banks or obligations guaranteed
by the Government National Mortgage Association;
(e) Obligations of the Federal National Mortgage Association, including Federal
National Mortgage Association participation certificates and mortgage pass -through
certificates guaranteed by the Federal National Mortgage Association;
(f) Securities of, or other interests in, any open-end or closed -end management
type investment company or investment trust registered under the Investment Company Act
of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided the portfolio
of such investment company or investment trust is limited to United States Government
obligations and to repurchase agreements fully collateralized by such United States
Government obligations and provided such investment company or investment trust takes
delivery of such collateral either directly or through an authorized custodian; or
(g) Any other investments that at the time are legal investments for municipal
funds, are permitted by the duly approved investment policy of the Village and as to which
the Bank has not objected in writing.
SECTION 10. ADVANCES AND APPLICATION OF BOND PROCEEDS.
(a) The proceeds of the Bonds shall be disbursed by the Bank by making
Advances (as defined below) from time to time in an aggregate principal amount not
exceeding $2,800,000, provided that no Advance shall be made after April 30, 2005.
(b) The Village may request an Advance by delivering to the Bank at least one
Business Day (as defined below) prior to the date on which the Advance is requested to be
funded a written request signed by either the Mayor, the Village Manager or the Finance
Director of the Village (each such request, a "Notice of Advance") (i) specifying the
Business Day on which the funding of the Advance is requested; (ii) specifying the amount
of the Advance requested; (iii) stating that to the best of the signer's knowledge, no event of
default under the Resolution has occurred and is continuing (which has not been cured or
waived) and no event which, with the giving of notice or the passage of time or both would
constitute an event of default, has occurred and is continuing.
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(c) Upon receipt of a Notice of Advance, the Bank shall fund the Advance
requested prior to 11:00 a.m. on the later of the succeeding Business Day or the date such
Advance is requested to be funded. On the date the Advance is to be funded, the Bank shall
make available the amount of the Advance requested in immediately available funds.
(d) A Notice of Advance may be revoked by the Village upon delivery of a
written notice delivered to the Bank not later than 9:00 a.m. on the date the proposed
Advance is to be funded.
(e) For purposes of this Section 10, "Advance" shall mean an advance of the
Bond proceeds by the Bank to the Village, and "Business Day" shall mean any date other
than a Saturday, Sunday or other day on which the Bank is lawfully closed.
(f) Sufficient proceeds received from the first Advance on the date of issuance
of the Bonds shall be applied to pay costs of issuance of the Bonds and to reimburse the
Village's project fund for costs of acquiring the Property. All other proceeds received from
the first Advance, as well as proceeds received from all subsequent Advances, shall be
deposited in the "Village of Key Biscayne Land Acquisition and Capital Improvement
Revenue Bonds, Series 2004 Project Fund" (the "Project Fund"), hereby created, and used
only in connection with the Project.
(g) Pending their use, the proceeds in the Project Fund may be invested in
Authorized Investments, maturing not later than the date or dates on which such proceeds
will be needed for the purposes of this Bond Resolution. Subject to Section 12 hereof, any
income received upon such investment shall be deposited in the Project Fund and applied to
costs of the Project or, at the option of the Village, deposited in the Bond Fund and used to
pay interest on the Bonds until completion of the Project. Subject to Section 12 hereof, after
the completion of the Project, any remaining balance of proceeds of the Bonds shall be
deposited into the Bond Fund and used solely to pay principal of the Bonds.
(h) The Project Fund shall be kept separate and apart from all other funds of the
Village and the moneys on deposit therein shall be withdrawn, used and applied by the
Village solely for the purposes set forth herein. Pending such application, the Project Fund
shall be subject to the lien of the Owners of the Bonds for the payment of the principal of and
interest on the Bonds.
(i) The registered Owners shall have no responsibility for the use of the proceeds
of the Bonds, and the use of such Bond proceeds by the Village shall in no way affect the
rights of such registered Owners. The Village shall be obligated to apply the proceeds of the
Bonds solely for financing costs of the Project. However, the Village shall be irrevocably
obligated to continue to pay the principal of and interest on the Bonds notwithstanding any
failure of the Village to use and apply such Bond proceeds in the manner provided herein.
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SECTION 11. FUNDS. Each of the funds and accounts herein established and created shall
constitute trust funds for the purposes provided herein for such funds and accounts respectively. The
money in such funds and accounts shall be continuously secured in the same manner as deposits of
Village funds are authorized to be secured by the laws of the State of Florida. Except as otherwise
provided herein, earnings on any investments in any amounts on any of the funds and accounts
herein established and created shall be credited to such respective fund or account.
The designation and establishment of the funds and accounts in and by this Bond Resolution
shall not be construed to require the establishment of any completely independent, self -balancing
funds, as such term is commonly defined and used in governmental accounting, but rather is intended
solely to constitute an earmarking of certain revenues and assets of the Village for the purposes
herein provided and to establish certain priorities for application of such revenues and assets.
SECTION 12. INVESTMENTS AND USE OF PROCEEDS TO COMPLY WITH
INTERNAL REVENUE CODE OF 1986. The Village covenants to the Owners of the Bonds that
it will take all actions and do all things necessary and desirable in order to maintain the exclusion
from gross income for federal income tax purposes of interest on the Bonds, and shall refrain from
taking any actions that would cause interest on the Bonds to be included in gross income for federal
income tax purposes. In particular, the Village will not make or direct the making of any investment
or other use of the proceeds of the Bonds which would cause such Bonds to be "private activity
bonds" as that term is defined in Section 141 (or any successor provision thereto) of the Code or
"arbitrage bonds" as that term is defined in Section 148 (or any successor provision thereto) of the
Code, and all applicable regulations promulgated under the Code, and that it will comply with the
applicable requirements of Sections 141 and 148 of the Code and the aforementioned regulations
throughout the term of the Bonds.
SECTION 13. DESIGNATION UNDER SECTION 265(b)(3) OF THE CODE. The Village
hereby designates the Bonds as qualified tax-exempt obligations under Section 265(b)(3)(B) of the
Code, and shall make all necessary filings in order to effectuate such election. The Village represents
that neither the Village nor any subordinate entities or entities issuing tax-exempt obligations on
behalf of the Village within the meaning of Section 265(b)(3) of the Code have issued tax-exempt
obligations during calendar year 2004 and neither the Village nor any such entities expect to issue
tax-exempt obligations during calendar year 2004, other than the Bonds and a $400,199 lease -
purchase obligation for police vehicles.
SECTION 14. ARBITRAGE REBATE COVENANTS. There is hereby created and
established a fund to be held by the Village, designated the "Village of Key Biscayne Land
Acquisition and Capital Improvement Revenue Bonds, Series 2004 Rebate Fund" (the "Rebate
Fund"). The Rebate Fund shall be held by the Village separate and apart from all other funds and
accounts held by the Village under this Resolution and from all other moneys of the Village.
Notwithstanding anything in this Resolution to the contrary, the Village shall transfer to the
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11
if any, attached as an Exhibit to the Arbitrage Certificate to be delivered by the Village on the date
of delivery of the Bonds (the "Rebate Covenants"), when such amounts are so required to be
transferred. The Village Manager shall make or cause to be made payments from the Rebate Fund
of amounts required to be deposited therein to the United States of America in the amounts and at
the times required by the Rebate Covenants. The Village covenants for the benefit of the Owners of
the Bonds that it will comply with the Rebate Covenants. The Rebate Fund, together with all moneys
and securities from time to time held therein and all investment earnings derived therefrom, shall be
excluded from the pledge and lien of this Resolution. The Village shall not be required to comply
with the requirements of this Section 14 in the event that the Village obtains an opinion of nationally
recognized bond counsel that (i) such compliance is not required in order to maintain the federal
income tax exemption of interest on the Bonds and/or (ii) compliance with some other requirement
is necessary to maintain the federal income tax exemption of interest on the Bonds.
SECTION 15. SPECIAL COVENANTS.
(a) The Village shall, within one hundred eighty (180) days of the end of each
fiscal year of the Village, deliver to the Bondholders a copy of the annual audited financial
statements of the Village. Within thirty (30) days of its final adoption, the Village shall
deliver to the Bondholders a copy of the operating budget for each upcoming fiscal year of
the Village.
(b) (i) The Village hereby covenants that, so long as the Bonds are
outstanding, it shall maintain a Debt Service Coverage Ratio (hereinafter defined)
equal to 1.25 to 1.
(ii) The Village shall be permitted to issue additional Debt secured in the
same manner as the Bonds (as specified in Section 7 hereof), so long as on the date
of issuance of such additional Debt the Debt Service Coverage Ratio for the current
fiscal year of the Village is at least 1.25 to 1.
(iii) "Debt Service Coverage Ratio" shall mean the ratio of (a) all Non -Ad
Valorem Revenues (as defined in Section 7 hereof) of the Village in the current fiscal
year of the Village plus any available cash balance in the General Fund, to (b) the
Debt Service coming due on the Bonds and all other Debt of the Village secured in
the same manner as the Bonds (as specified in Section 7 hereof), plus, for purposes
of the calculation in (ii) above only, the additional Debt.
(c) The total Debt of the Village, including amounts authorized but still not
drawn down under existing loan agreements and other contractual arrangements with banks
and other financial institutions, underwriters, brokers and/or intermediaries, shall not exceed
the greater of:
{M1250954_2)
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(i) one percent (1 %) of the total assessed value of all property within the
Village, as certified by the Miami -Dade County Property Appraiser for the current
fiscal year; or
(ii) that amount which would cause annual Debt Service to equal fifteen
percent (15%) of General Fund expenditures for the previous fiscal year.
(d) As used in this Section 15, the following terms shall have the meaning
ascribed to them in this subsection:
(i) "Debt" shall mean any obligation of the Village to repay borrowed
money however evidenced since the date of its incorporation regardless of tenor or
term for which it was originally contracted or subsequently converted through
refinancing or novation, except (A) any obligation required to be repaid in less than
a year and which was incurred solely for emergency relief of natural disasters, or (B)
that portion of any obligations for operations which are financed and operated in an
independent, self-liquidating manner and recovered entirely through currently
collected user fees and charges.
(ii) "Debt Service" shall include, without limitation thereto, scheduled
interest payments, repayments of principal and all financial fees arising from Debt
or from the underlying contractual obligations, whether as originally incurred or
subsequently deferred or otherwise renegotiated.
(iii) "General Fund" shall mean any and all revenues of the Village, from
whatever source derived, except those revenues derived from special assessments,
user fees and charges and designated as a separate fund to finance goods and services
to the public.
SECTION 16. COVENANTS BINDING ON VILLAGE AND SUCCESSOR. All covenants,
stipulations, obligations and agreements of the Village contained in this Resolution constitute a
contract between the Village and the Owners of the Bonds and shall be deemed to be covenants,
stipulations, obligations and agreements of the Village to the full extent authorized or permitted by
law, and all such covenants, stipulations, obligations and agreements shall be binding upon the
successor or successors thereof from time to time and upon the officer, board, body or commission
to whom or to which any power or duty affecting such covenants, stipulations, obligations and
agreements shall be transferred by or in accordance with law.
Except as otherwise provided in this Resolution, all rights, powers and privileges conferred
and duties and liabilities imposed upon the Village or upon the Village Council by the provisions
of this Resolution shall be exercised or performed by the Village Council or by such officers, board,
body or commission as may be required by law to exercise such powers or to perform such duties.
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No covenant, stipulation, obligation or agreement herein contained shall be deemed to be a
covenant, stipulation, obligation or agreement of any present or future member of the Village
Council or officer, agent or employee of the Village in his or her individual capacity, and neither the
members of the Village Council nor any officer, agent or employee of the Village executing the
Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability
by reason of the issuance thereof.
SECTION 17. EVENTS OF DEFAULT. Each of the following events is hereby declared
an "event of default":
(a) payment of the principal of or amortization installments of any of the Bonds
shall not be made when the same shall become due and payable; or
(b) payment of any installment of interest on any of the Bonds shall not be made
when the same shall become due and payable; or
(c) the Village shall default in the due and punctual performance of any covenant,
condition, agreement or provision contained in the Bonds or in this Resolution (except for
a default described in subsection (a) or (b) of this Section) on the part of the Village to be
performed, and such default shall continue for sixty (60) days after written notice specifying
such default and requiring same to be remedied shall have been given to the Village by any
Owner of any Bond; provided that it shall not constitute an event of default if the default is
not one that can be cured within such sixty (60) days, as agreed by the Bondholders and the
Village, and the Village commences within such sixty (60) days and, in the sole judgment
of the Bondholders, is proceeding diligently with action to correct such default; or
(d) any proceeding shall be instituted with or without the consent of the Village
under federal bankruptcy laws or other federal or state laws affecting creditors' rights or any
proceeding shall otherwise be instituted for the purpose of effecting a composition between
the Village and its creditors or for the purpose of adjusting the claims of such creditors
pursuant to any federal or state statute now or hereafter enacted and any such proceeding
shall not have been dismissed with prejudice within thirty (30) days after the institution of
the same.
SECTION 18. REMEDIES; RIGHTS OF BONDHOLDERS. Upon the occurrence and
continuance of any event of default specified in Section 17 hereof, the Owners of the Bonds may
pursue any available remedy by suit, at law or in equity to enforce the payment of the principal of
and interest on the Bonds then outstanding.
No delay or omission to exercise any right or power accruing upon any default or event of
default shall impair any such right or power or shall be construed to be waiver of any such default
or event of default or acquiescence therein; and every such right and power may be exercised from
time to time and as often as may be deemed expedient. No waiver of any event of default hereunder
{M1250954 2}
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shall extend to or shall affect any subsequent event of default or shall impair any rights or remedies
consequent thereon.
The Village agrees, to the extent permitted by law, to indemnify the Bank and its directors,
officers, employees and agents from and against any losses, claims, damages, liabilities and expenses
(including, without limitation, counsel fees and expenses) which may be incurred in connection with
enforcement of the provisions of this Resolution and the Bonds.
SECTION 19. DEFEASANCE.
(a) The covenants, liens and pledges entered into, created or imposed pursuant to this
Resolution may be fully discharged and satisfied with respect to the Bonds in any one or more of the
following ways.
(i) by paying the principal of, prepayment premium, if any, and interest on the
Bonds when the same shall become due and payable; or
(ii) by depositing with an escrow agent certain moneys irrevocably pledged to the
payment of the Bonds, which together with other moneys lawfully available therefor, if any,
shall be sufficient at the time of such deposit with the escrow agent to pay when due the
principal, prepayment premium, if any, and interest due and to become due on said Bonds
on or prior to the prepayment date or maturity date thereof; or
(iii) by depositing with an escrow agent moneys irrevocably pledged to the
payment of the Bonds, which together with other moneys lawfully available therefor, when
invested by the escrow agent in direct obligations of the United States of America which
shall not be subject to redemption prior to their maturity other than at the option of the holder
thereof, will provide moneys which shall be sufficient (as evidenced by a verification report
of an independent certified public accountant or firm of accountants) to pay when due the
principal, prepayment premium, if any, and interest due and to become due on said Bonds
on or prior to the prepayment date or maturity date thereof.
Upon such payment or deposit with an escrow agent in the amount and manner provided in
this Section 19, the Bonds shall be deemed to be paid and shall no longer be deemed to be
Outstanding for the purposes of this Resolution and the covenants of the Village hereunder and all
liability of the Village with respect to said Bonds shall cease, terminate and be completely discharged
and extinguished and the holders thereof shall be entitled to payment solely out of the moneys or
securities so deposited with the escrow agent; provided, however, that (i) if any Bonds are to be
redeemed prior to the maturity thereof, notice of the redemption thereof shall have been duly given
in accordance with the provisions of Section 2 hereof and (ii) in the event that any Bonds are not by
their terms subject to redemption with the next succeeding sixty (60) days following a deposit of
moneys with the escrow agent in accordance with this Section, the Village shall have given the
escrow agent in form satisfactory to it irrevocable instructions to mail to the Owners of such Bonds
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15
at their addresses as they appear on the registration books of the Village, a notice stating that a
deposit in accordance with this Section has been made with the escrow agent and that the Bonds are
deemed to have been paid in accordance with this Section and stating such maturity or redemption
date upon which moneys are to be available for the payment of the principal of, premium, if any, and
interest on said Bonds.
(b) Notwithstanding the foregoing, all references to the discharge and satisfaction of
Bonds shall include the discharge and satisfaction of any portion of the Bonds.
(c) If any portion of the moneys deposited with an escrow agent for the payment of the
principal of, redemption premium, if any, and interest on any portion of the Bonds is not required
for such purpose, the escrow agent shall transfer to the Village the amount of such excess and the
Village may use the amount of such excess free and clear of any trust, lien, security interest, pledge
or assignment securing said Bonds or otherwise existing under this Resolution.
(d) Notwithstanding any of the foregoing, the requirements of Section 12 and 14 hereof
relating to use and investment of proceeds and rebate amounts due to the United States pursuant to
the Rebate Covenants shall survive the payment of principal and interest with respect to the Bonds
or any portion thereof.
SECTION 20. SALE OF BONDS. Based upon the uncertainty of the interest rate
environment if sale of the Bonds is delayed, the Village hereby determines the necessity for a
negotiated sale of the Bonds. The Village has been provided all applicable disclosure information
required by Section 218.385, Florida Statutes. The negotiated sale of the Bonds is hereby approved
to the Bank at a purchase price of par.
SECTION 21. AUTHORITY OF OFFICERS. The Mayor, the Vice Mayor, any member of
the Council, the Village Manager, the Village Clerk, the Finance Director and any other proper
official of the Village, are and each of them is hereby authorized and directed to execute and deliver
any and all documents and instruments and to do and cause to be done any and all acts and things
necessary or proper for carrying out the transaction contemplated by this Resolution and the other
documents identified herein.
SECTION 22. SEVERABILITY. In case any one or more of the provisions of this
Resolution or of any Bonds issued hereunder shall for any reason be held to be illegal or invalid,
such illegality or invalidity shall not affect any other provision of this Resolution or of the Bonds,
but this Resolution and the Bonds shall be construed and enforced as if such illegal or invalid
provision had not been contained therein. The Bonds are issued and this Resolution is adopted with
the intent that the laws of the State shall govern their construction.
SECTION 23. PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. In
any case where the date of maturity of interest on or principal of the Bonds shall be a Saturday,
Sunday or a day on which the banks in the State are required, or authorized or not prohibited, by law
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(including executive orders) to close and are closed, then payment of such interest or principal need
not be made by the Village on such date but may be made on the next succeeding business day on
which the banks in the State are open for business.
SECTION 24. OPEN MEETING FINDINGS. It is hereby found and determined that all
official acts of the Village Council concerning and relating to the adoption of this Resolution and
all prior resolutions affecting the Village Council's ability to issue the Bonds were taken in an open
meeting of the Village Council and that all deliberations of the Village Council or any of its
committees that resulted in such official acts were in meetings open to the public, in compliance with
all legal requirements, including Section 286.011, Florida Statutes.
SECTION 25. REPEALING CLAUSE. All resolutions or orders and parts thereof in conflict
herewith, to the extent of such conflicts, are hereby superseded and repealed.
SECTION 26. EFFECTIVE DATE. This Resolution shall take effect immediately upon its
passage and adoption.
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17
EXHIBIT "A"
No. R- $
UNITED STATES OF AMERICA
STATE OF FLORIDA
VILLAGE OF KEY BISCAYNE
LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS
SERIES 2004
Registered Owner:
Principal Amount: The lesser of (i) $2,800,000 or (ii) the Advances made under the Resolution
(as hereinafter defined)
KNOW ALL MEN BY THESE PRESENTS, that the Village of Key Biscayne, Florida (the
"Village"), for value received, hereby promises to pay to the Registered Owner shown above, or
registered assigns (the "Bank"), from the sources hereinafter mentioned, the Principal Amount
specified above or so much thereof as has been advanced and is outstanding. Subject to the rights
of prior prepayment and redemption described in the Bond, the Bond shall mature on November 1,
2022. Payments due hereunder shall be made no later than 2:00 p.m. on the date due, free and clear
of any defenses, set -offs, counterclaims, or withholding or deductions for taxes.
This Bond is issued under authority of and in full compliance with the Constitution and laws
of the State of Florida, including particularly Part II of Chapter 166, Florida Statutes, as amended,
the Charter of the Village, Ordinance No. 2002-2 duly adopted by the Village Council (the
"Council") of the Village on April 23, 2002 ("Ordinance 2002-2"), Ordinance No. 2004-8 duly
adopted by the Council on August 31, 2004 ("Ordinance 2004-8", and together with Ordinance
2002-2, the "Ordinance"), and Resolution No. 2004- adopted on October 12, 2004 (the
"Resolution," and collectively with the Ordinance, the "Bond Ordinance"), and is subject to the
terms of said Bond Ordinance. This Bond is issued for the purpose of reimbursing the project fund
for costs of acquiring land located at 530 Crandon Boulevard (the former Citgo Station site) for
Village purposes, financing a portion of the costs of site improvements for the Village's civic center,
financing architectural, engineering, environmental, legal and other planning costs related thereto,
and paying costs of issuance of the Bonds. This Bond shall be payable only from the sources
identified herein.
Subject to adjustment as provided below, this Bond shall bear interest on the outstanding
principal balance from its date of issuance payable quarterly on the first day of each February, May,
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A-1
August and November (the "Interest Payment Dates"), commencing February 1, 2005, at an interest
rate equal to 3.83% per annum to but not including November 1, 2012. Commencing on November
1, 2012 through the maturity date of the Bonds (the "Second Interest Rate Period"), the interest rate
shall be adjusted to a rate equal to (A) the ten-year Federal Reserve interest rate swap rate (the
"Index Rate"), plus 110 basis points, divided by (B) 1.5054 (such divisor, however, being subject
to adjustment if any of the events specified below, providing for adjustments to interest rates, occurs,
so as to provide the Owners of the Bonds the same after-tax yield they would otherwise have had in
the absence of such occurrence) (the "New Interest Rate"). The "Index Rate" is currently published
at the website: http://federalreserve.gov/releases/h15/update/.
Interest on this Bond shall be computed on the basis of a 360 -day year based on twelve 30 -
day months.
Adjustment of Interest Rate For Full Taxability. In the event a Determination of Taxability
shall have occurred during the Initial Interest Rate Period, the rate of interest on the Bonds shall be
increased to a rate per annum equal to 5.8982%, and in the event a Determination of Taxability shall
have occurred during the Second Interest Rate Period, the rate of interest on the Bonds shall be
increased to a rate per annum equal to the New Interest Rate times 1.54 (the "Taxable Rate"),
effective retroactively to the date on which the interest payable on the Bonds is includable for federal
income tax purposes in the gross income of the Owners thereof. In addition, the Owners of the
Bonds or any former Owners of the Bonds, as appropriate, shall be paid an amount equal to any
additions to tax, interest and penalties, and any arrears in interest that are required to be paid to the
United States by the Owners or former Owners of the Bonds as a result of such Determination of
Taxability. All such additional interest, additions to tax, penalties and interest shall be paid by the
Village on the next succeeding Interest Payment Date following the Determination of Taxability. A
"Determination of Taxability" shall mean (i) the issuance by the Internal Revenue Service of a
statutory notice of deficiency or other written notification which holds in effect that the interest
payable on the Bonds is includable for federal income tax purposes in the gross income of the
Owners thereof, which notice or notification is not contested with the Internal Revenue Service by
either the Village or any Owners of the Bonds, or (ii) a determination by a court of competent
jurisdiction that the interest payable on the Bonds is includable for federal income tax purposes in
the gross income of the Owners thereof, which determination either is final and non -appealable or
is not appealed within the requisite time period for appeal, or (iii) the admission in writing by the
Village to the effect that interest on Bonds is includable for federal income tax purposes in the gross
income of the Owners thereof, or (iv) receipt by the Village of an opinion of bond counsel to the
Village to the effect that interest on the Bonds is includable for federal income tax purpose in the
gross income of the Owners thereof.
Adjustment of Interest Rate for Partial Taxability. In the event that interest on the Bonds
during any period becomes partially taxable as a result of a Determination of Taxability applicable
to less than all of the Bonds, then the interest rate on the Bonds shall be increased during such period
by an amount equal to: (A -B) x C where:
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(a) A equals the Taxable Rate (expressed as a percentage);
(b) B equals the interest rate on the Bonds (expressed as a percentage); and
(c) C equals the portion of the Bonds the interest on which has become taxable
as the result of such tax change (expressed as a decimal).
In addition, the Owners of the Bonds or any former Owners of the Bonds, as appropriate,
shall be paid an amount equal to any additions to tax, interest and penalties, and any arrears in
interest that are required to be paid to the United States by the Owners or former Owners of the
Bonds as a result of such Determination of Taxability. All such additional interest, additions to tax,
penalties and interest shall be paid by the Village on the next succeeding Interest Payment Date
following the Determination of Taxability.
Adjustment of Interest Rate for Change in Maximum Corporate Tax Rate. In the event that
the maximum effective federal corporate tax rate (the "Maximum Corporate Tax Rate") during any
period with respect to which interest shall be accruing on the Bonds on a tax-exempt basis, shall be
other than thirty-five percent (35%), the interest rate on the Bonds that are bearing interest on a tax-
exempt basis shall be adjusted to the product obtained by multiplying the interest rate then in effect
on the Bonds by a fraction equal to (1-A divided by 1-B), where A equals the Maximum Corporate
Tax Rate in effect as of the date of adjustment and B equals the Maximum Corporate Tax Rate in
effect immediately prior to the date of adjustment.
Adjustment of Interest Rate for Other Changes Affecting After -Tax Yield. So long as any
portion of the principal amount of the Bonds or interest thereon remains unpaid (a) if any law, rule,
regulation or executive order is enacted or promulgated by any public body or governmental agency
which changes the basis of taxation of interest on the Bonds or causes a reduction in yield on the
Bonds (other than by reason of a change described above) to the Owners or any former Owners of
the Bonds, including without limitation the imposition of any excise tax or surcharge thereon, or (b)
if, as a result of action by any pubic body or governmental agency, any payment is required to be
made by, or any federal, state or local income tax deduction is denied to, the Owners or any former
Owners of the Bonds (other than by reason of a change described above or by reason of any action
or failure to act on the part of any Owner or any former Owner of the Bonds) by reason of the
ownership of the Bonds, the Village shall reimburse any such Owner within five (5) days after
receipt by the Village of written demand for such payment, and the Village agrees to indemnify each
such Owner against any loss, cost, charge or expense with respect to any such change. The
determination of the after-tax yield calculation shall be verified by a firm of certified public
accountants regularly employed by the Bank (or the current Owner of the Bonds) and acceptable to
the Village, and such calculation, in the absence of manifest error, shall be binding on the Village
and the Owners.
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A-3
The principal of this Bond shall be subject to mandatory prepayment in quarterly installments
on each Interest Payment Date, commencing August 1, 2005 (each a "Scheduled Due Date"). The
schedule of principal and interest payments due on each Scheduled Due Date shall be determined
on April 30, 2005, after the last Advance (as defined in Section 10(e) of the Resolution) has been
made in accordance with Section 10(a) of the Resolution. The schedule shall be determined based
on a seventeen and one-half (17.5) year amortization schedule of substantially level payment of
principal and interest, with payments of principal and interest sufficient to fully amortize so much
of the principal amount of the Bonds as has been Advanced hereunder, with the final payment due
and payable on November 1, 2022.
In the event that there is more than one Owner of the Bonds, (i) the Village shall determine
the amount of each Bond to be redeemed, and (ii) the Village shall give notice to each Owner of the
Bonds at least three (3) days prior to the date of mandatory redemption of the amount of each Bond
to be redeemed.
The principal of and interest on this Bond are payable in lawful money of the United States
of America by wire transfer or by certified check delivered on or prior to the date due to the
registered Owner or his legal representative at the address of the Owner as it appears on the
registration books of the Village.
This Bond is subject to optional prepayment, upon thirty (30) days written notice to the
Owners of the Bonds, in whole or in part at any time at par, plus accrued interest to the date of
prepayment.
The Village has covenanted and agreed in the Bond Ordinance to appropriate in its annual
budget, by amendment, if necessary, from Non -Ad Valorem Revenues (as defined below) lawfully
available in each fiscal year, amounts sufficient to pay the principal and interest due on the Bonds
in accordance with their terms during such fiscal year. "Non -Ad Valorem Revenues" means all
revenues of the Village derived from any source other than ad valorem taxation on real or personal
property which are legally available to make the payments required under the Bond Ordinance, other
than (i) Public Service Taxes authorized by Part III, Chapter 166, Florida Statutes, and received by
the Village pursuant to Section 25-50 et seq. of the Village Code and (ii) Stormwater Utility Fees
as defined by Section 403.0893(3), Florida Statutes, and imposed pursuant to Ordinance No. 93-11
adopted by the Village Council on June 22, 1993 (as amended by Ordinance No. 93-11-A); but only
after provision has been made by the Village for the payment of all essential or legally mandated
services not otherwise provided for by ad valorem taxes. Such covenant and agreement on the part
of the Village to budget and appropriate such amounts of Non -Ad Valorem Revenues shall be
cumulative to the extent not paid, and shall continue until such Non -Ad Valorem Revenues or other
legally available funds in amounts sufficient to make all such required payments shall have been
budgeted, appropriated and actually paid. Notwithstanding the foregoing covenant of the Village,
the Village does not covenant to maintain any services or programs, now provided or maintained by
the Village, which generate Non -Ad Valorem Revenues. Such covenant to budget and appropriate
does not create any lien upon or pledge of such Non -Ad Valorem Revenues, nor does it preclude the
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A-4
Village from pledging in the future its Non -Ad Valorem Revenues, nor does it require the Village
to levy and collect any particular Non -Ad Valorem Revenues, nor does it give the Bondholders a
prior claim on the Non -Ad Valorem Revenues as opposed to claims of general creditors of the
Village. Such covenant to appropriate Non -Ad Valorem Revenues is subject in all respects to the
payment of obligations secured by a pledge of such Non -Ad Valorem Revenues heretofore or
hereinafter entered into (including the payment of debt service on bonds and other debt instruments).
However, the covenant to budget and appropriate in its general annual budget for the purposes and
in the manner stated in the Bond Ordinance shall have the effect of making available in the manner
described herein Non -Ad Valorem Revenues and placing on the Village a positive duty to
appropriate and budget, by amendment, if necessary, amounts sufficient to meet its obligations under
the Bond Ordinance, subject, however, in all respects to the terms of the Bond Ordinance and the
restrictions of Section 166.241(3), Florida Statutes, which provides, in part, that the governing body
of each municipality make appropriations for each fiscal year which, in any one year, shall not
exceed the amount to be received from taxation or other revenue sources; and subject, further, to the
payment of services and programs which are for essential public purposes affecting the health,
welfare and safety of the inhabitants of the Village or which are legally mandated by applicable law.
THIS BOND SHALL NOT BE DEEMED TO CONSTITUTE AN INDEBTEDNESS OF
THE VILLAGE OR A PLEDGE OF THE FAITH AND CREDIT OF THE VILLAGE, BUT SHALL
BE PAYABLE EXCLUSIVELY FROM LEGALLY AVAILABLE NON -AD VALOREM
REVENUES OF THE VILLAGE. THE ISSUANCE OF THIS BOND SHALL NOT DIRECTLY
OR INDIRECTLY OR CONTINGENTLY OBLIGATE THE VILLAGE TO LEVY OR TO
PLEDGE ANY FORM OF TAXATION WHATEVER THEREFOR NOR SHALL THIS BOND
CONSTITUTE A CHARGE, LIEN, OR ENCUMBRANCE, LEGAL OR EQUITABLE, UPON
ANY PROPERTY OF THE VILLAGE, AND THE HOLDER OF THIS BOND SHALL HAVE NO
RECOURSE TO THE POWER OF TAXATION.
The original registered Owner, and each successive registered Owner of this Bond shall be
conclusively deemed to have agreed and consented to the following terms and conditions:
1. The Village shall keep books for the registration of Bonds and for the
registration of transfers of Bonds as provided in the Resolution. Bonds may be transferred
or exchanged upon the registration books kept by the Village, upon delivery to the Village,
together with written instructions as to the details of the transfer or exchange, of such Bonds
in form satisfactory to the Village and with guaranty of signatures satisfactory to the Village,
along with the social security number or federal employer identification number of any
transferee and, if the transferee is a trust, the name and social security or federal tax
identification numbers of the settlor and beneficiaries of the trust, the date of the trust and
the name of the trustee. The Bonds may be exchanged for Bonds of the same principal
amount and maturity and denominations in integral multiples of $250,000 (except that an odd
lot is permitted to complete the outstanding principal balance). No transfer or exchange of
any Bond shall be effective until entered on the registration books maintained by the Village.
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A-5
2. The Village may deem and treat the person in whose name any Bond shall be
registered upon the books of the Village as the absolute Owner of such Bond, whether such
Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the
principal of and interest on such Bond as they become due, and for all other purposes. All
such payments so made to any such Owner or upon his order shall be valid and effectual to
satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid.
3. In all cases in which the privilege of exchanging Bonds or transferring Bonds
is exercised, the Village shall execute and deliver Bonds in accordance with the provisions
of the Resolution. There shall be no charge for any such exchange or transfer of Bonds, but
the Village may require payment of a sum sufficient to pay any tax, fee or other
governmental charge required to be paid with respect to such exchange or transfer. The
Village shall not be required to transfer or exchange Bonds for a period of fifteen (15) days
next preceding an interest payment date on such Bonds.
4. All Bonds, the principal and interest of which has been paid, either at or prior
to maturity, shall be delivered to the Village when such payment is made, and shall
thereupon be cancelled. In case part, but not all of an outstanding Bond shall be prepaid, such
Bond shall not be surrendered in exchange for a new Bond.
It is hereby certified and recited that all acts, conditions and things required to happen, to
exist and to be performed precedent to and for the issuance of this Bond have happened, do exist and
have been performed in due time, form and manner as required by the Constitution and the laws of
the State of Florida applicable thereto.
IN WITNESS WHEREOF, the Village of Key Biscayne, Florida has caused this Bond to
be executed by the manual or facsimile signature of its Mayor and of its Village Clerk, and the Seal
of the Village of Key Biscayne, Florida or a facsimile thereof to be affixed hereto or imprinted or
reproduced hereon, all as of the day of , 2004.
VILLAGE OF KEY BISCAYNE, FLORIDA
Mayor
Village Clerk
(SEAL)
(M1250954_2}
A-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned (the
"Transferor"), hereby sells, assigns and transfers unto (Please
insert name and Social Security or Federal Employer identification number of assignee) the within
Bond and all rights thereunder, and hereby irrevocably constitutes and appoints
(the "Transferee") as attorney to register the transfer of the within
Bond on the books kept for registration thereof, with full power of substitution in the premises.
Date
Social Security Number of Assignee
Signature Guaranteed:
NOTICE: Signature(s) must be
guaranteed by a member firm of
the New York Stock Exchange or
a commercial bank or a trust company
NOTICE: No transfer will be registered and no new Bond will be issued in the name of the
Transferee, unless the signature(s) to this assignment corresponds with the name as it appears upon
the face of the within Bond in every particular, without alteration or enlargement or any change
whatever and the Social Security or Federal Employer Identification Number of the Transferee is
supplied.
The following abbreviations, when used in the inscription on the face of the within Bond,
shall be construed as though they were written out in full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIF MIN ACT - ,
(Cust.)
Custodian for ,
(Minor)
TEN ENT - as tenants by
the entirety
JT TEN - as joint tenants with
right of survivorship and
not as tenants in common
under Uniform Gifts to Minors
Act of
(State)
Additional abbreviations may also be used though not in the list above.
{M1250954_2}
A-7
PASSED AND ADOPTED this 12th day of October, 2004.
4/0 (etut,,A71 .
MAYOR ROBERT OLDAKOWSKI
CONCHITA H. ALVAREZ, CMC, VILLAGE CLE
APPROVED AS TO FORM AND LEGAL SUFFIC
VILLAGE £ TTO
{M1250954_2}
18