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HomeMy Public PortalAbout1999-71 Authorizng the issuance of land acquisition and capital improvement revenue bonds, series 1999 Nations BankRESOLUTION NO. 99-71 A RESOLUTION OF THE VILLAGE OF KEY BISCAYNE, FLORIDA, AUTHORIZING THE ISSUANCE OF LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 1999, OF THE VILLAGE OF KEY BISCAYNE, FLORIDA, IN THE AGGREGATE PRINCIPAL AMOUNT OF $10,000,000 FOR THE PURPOSE OF PURCHASING LAND TO BE USED FOR VILLAGE PURPOSES, FINANCING COSTS INCIDENT TO THE PURCHASE OF SUCH LAND, SUCH AS SURVEY AND LEGAL FEES, FINANCING OR REIMBURSING A PORTION OF THE COSTS OF CONSTRUCTION OF A FIRE STATION, POLICE STATION, COMMUNITY CENTER AND VILLAGE ADMINISTRATIVE OFFICES, FINANCING OR REIIVIBU ING ARCHITECTURAL, ENGINEERING, ENVIRONMENTAL AND OTHER PLANNING COSTS RELATED THERETO, AND PAYING COSTS OF ISSUANCE OF THE BONDS; AWARDING THE SALE OF THE BONDS TO BANK OF AMERICA, N.A., DB/A NATIONSBANK, N.A.; 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 June 22, 1999, the Village Council (the "Council") of the Village of Key Biscayne, Florida (the "Village") adopted Ordinance No. 99-6 (the "Ordinance") authorizing the issuance of not exceeding $10,000,000 Village of Key Biscayne, Florida Land Acquisition and Capital Improvement Revenue Bonds, Series 1999 (the "Bonds"), for the purpose of purchasing land to be used for Village purposes, financing costs incident to the purchase of such land, such as survey and legal fees, financing or reimbursing a portion of the costs of construction of a fire station, police station, community center and Village administrative offices, financing architectural, engineering, environmental and other planning costs related thereto, and paying costs of issuance of the Bonds (the "Project"); and WHEREAS, pursuant to the Ordinance, the Village has solicited proposals for the financing of the Project; and WHEREAS, the Council hereby determines to accept a commitment (the"Commitment") from Bank of America, N.A., d/b/a NationsBank, N.A. (the "Bank") to purchase the Bonds; and WHEREAS, the Council desires to set forth the details of the Bonds in this Bond Resolution; JDC/B.MISC/233859-2/13524.003 1 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 the 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 1999" (the "Bonds"), are hereby authorized to be issued in an aggregate principal amount of $10,000,000 for the purpose of purchasing land to be used for Village purposes, financing costs incident to the purchase of such land, such as survey and legal fees, financing or reimbursing a portion of the costs of construction of a fire station, police station, community center and Village administrative offices, financing or reimbursing architectural, engineering, environmental and other planning costs related thereto, and paying costs of issuance of the Bonds. Section 2. Terms of the bonds. 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. The Bonds shall be dated the date of their issuance and delivery and shall be initially issued as one Bond in the denomination of $10,000,000. The Bonds shall mature on December 1, 2019. Subject to adjustment as provided below, the Bonds shall bear interest on the outstanding principal balance from their date of issuance payable semiannually on the first day of each June and December (the "Interest Payment Dates"), commencing December 1, 1999, at an interest rate equal to 4.715% per annum. Interest on the Bonds shall be computed on the basis of a 360 -day year based on twelve 30 - day months. Adjustment of Interest Rate Upon Determination of Taxability. In the event a Determination of Taxability shall have occurred, the rate of interest on the Bonds shall be adjusted to a rate equal to a fraction, (i) the numerator of which is equal to the interest rate otherwise borne by the Bonds, and (ii) the denominator of which is equal to one (1) minus the Maximum Corporate Tax Rate in effect as of the date of such Determination of Taxability (the "Adjusted Interest Rate"), as of and from the date such determination would be applicable with respect to the Bonds (the "Accrual Date"). The Village shall on the next interest payment date pay to the Owners of the Bonds or any former Owners of the Bonds as may be appropriately allocated, an amount equal to the sum of (1) the difference between (A) the total interest that would have accrued on the Bonds at the Adjusted Interest Rate from the Accrual Date to the date of the Determination of Taxability, and (B) the actual interest paid by the Village on the Bonds from the Accrual Date to the date of the Determination of Taxability, and (2) any interest and penalties required to be paid as a result of any additional State of Florida and federal income taxes imposed upon such Owner arising as a result of such JDC/B.MISC/233859-2/13524.003 2 Determination of Taxability. From and after the Determination of Taxability, the Bonds shall continue to bear interest at the Adjusted Interest Rate for the period such determination continues to be applicable with respect to the Bonds. This adjustment shall survive payment of the Bonds until such time as the federal statute of limitations under which the interest on the Bonds could be declared taxable under the Code shall have expired. 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 disputed 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. Adjustment of Interest Rate for Change in Maximum Corporate Tax Rate. In the event that the Maximum Corporate Tax Rate decreases or increases from thirty-five percent (35%), the interest rate otherwise borne by the Bonds shall be adjusted to the product obtained by multiplying the interest rate otherwise borne by the Bonds by a fraction, (i) the numerator of which is equal to one (1) minus the Maximum Corporate Tax Rate in effect as of the date of adjustment, and (ii) the denominator of which is equal to 0.65. The interest rate otherwise borne by the Bonds shall be adjusted automatically as of the effective date of each change in the Maximum Corporate Tax Rate. As used herein: (1) "Code" means the Internal Revenue Code of 1986, as amended, and any Treasury Regulations, whether temporary, proposed or final, promulgated thereunder or applicable thereto; and (2) "Maximum Corporate Tax Rate" means, as of any date of determination, the highest marginal tax rate (expressed as a decimal) applicable to the taxable income of corporations (as currently set forth in Section 11 of the Code) without regard to any increase in tax designated to normalize the rate for all income at the highest marginal tax rate or to phase out the benefit of graduated tax rates and impose a flat -tax at a specified rate (for example, the tax imposed by the last two sentences of Section 11(b)(1) of the Code as in effect on the original issue date of the Bonds), which rate on the original issue date of the Bonds is 35. The principal of the Bonds shall be payable in eighteen (18) annual installments on each December 1, commencing December 1, 2002 (each a "Scheduled Due Date"). The amount of each such installment shall be as follows: JDC/B.MISC/233859-2/13524.003 3 Principal Year Installment Due 2002 $355,000 2003 375,000 2004 390,000 2005 410,000 2006 430,000 2007 455,000 2008 475,000 2009 500,000 2010 525,000 2011 550,000 2012 580,000 2013 610,000 2014 640,000 2015 670,000 2016 705,000 2017 740,000 2018 775,000 2019 815,000 The Bonds are subject to prepayment in whole or in part at any time on at a price of par plus accrued interest to the date of prepayment, plus a premium equal to the "Prepayment Fee" described in Exhibit "A" attached hereto, upon written notice to the Owners thereof given by the Village at least three (3) days prior to the date fixed for prepayment. Partial prepayments shall be applied to the maturities of principal installments in any order determined by the Village. The final prepayment provisions are subject to such changes to J3xhibit "A" as the Village Manager, upon consultation with the Village Attorney, the Village's Financial Advisor and the Village's Bond Counsel, shall approve, with the execution of the Bonds by the appropriate officers of the Village with such final prepayment provision set forth therein being conclusive evidence of the approval by the Village Manger. 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, BOTH 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. JDC/B.MISC/233859-2/13524.003 4 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 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. ,TDC/B.MISC/233859-2/13524.003 5 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 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 following tenor, with such omissions, insertions and variations as may be necessary and desirable and authorized or permitted by this Resolution. JDC/B.MISC/233859-2/13524.003 6 No. R- $ UNITED STATES OF AMERICA STATE OF FLORIDA VILLAGE OF KEY BISCAYNE LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS SERIES 1999 Registered Owner: Principal Amount: Dollars 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. Subject to the rights of prior prepayment described in the Bond, the Bond shall mature on December 1, 2019. 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. 99-6 duly adopted by the Village Council of the Village on June 22, 1999 (the "Ordinance") and Resolution No. 99- adopted on July 23, 1999 (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 purchasing land to be used for Village purposes, financing costs incident to the purchase of such land, such as survey and legal fees, financing or reimbursing a portion of the costs of construction of a fire station, police station, community center and Village administrative offices, financing or reimbursing architectural, engineering, environmental 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 semiannually on the first day of each June and December (the "Interest Payment Dates"), commencing December 1, 1999, at an interest rate equal to 4.715% per annum. 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 Upon Determination of Taxability. In the event a Determination of Taxability shall have occurred, the rate of interest on the Bonds shall be adjusted to a rate equal JDC/B.MISC/233859-2/13524.003 7 to a fraction, (i) the numerator of which is equal to the interest rate otherwise borne by the Bonds, and (ii) the denominator of which is equal to one (1) minus the Maximum Corporate Tax Rate in effect as of the date of such Determination of Taxability (the "Adjusted Interest Rate"), as of and from the date such determination would be applicable with respect to the Bonds (the "Accrual Date"). The Village shall on the next interest payment date pay to the Owners of the Bonds or any former Owners of the Bonds as may be appropriately allocated, an amount equal to the sum of (1) the difference between (A) the total interest that would have accrued on the Bonds at the Adjusted Interest Rate from the Accrual Date to the date of the Determination of Taxability, and (B) the actual interest paid by the Village on the Bonds from the Accrual Date to the date of the Determination of Taxability, and (2) any interest and penalties required to be paid as a result of any additional State of Florida and federal income taxes imposed upon such Owner arising as a result of such Determination of Taxability. From and after the Determination of Taxability, the Bonds shall continue to bear interest at the Adjusted Interest Rate for the period such determination continues to be applicable with respect to the Bonds. This adjustment shall survive payment of the Bonds until such time as the federal statute of limitations under which the interest on the Bonds could be declared taxable under the Code shall have expired. 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 disputed 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. Adjustment of Interest Rate for Change in Maximum Corporate Tax Rate. In the event that the Maximum Corporate Tax Rate decreases or increases from thirty-five percent (35%), the interest rate otherwise borne by the Bonds shall be adjusted to the product obtained by multiplying the interest rate otherwise borne by the Bonds by a fraction, (i) the numerator of which is equal to one (1) minus the Maximum Corporate Tax Rate in effect as of the date of adjustment, and (ii) the denominator of which is equal to 0.65. The interest rate otherwise borne by the Bonds shall be adjusted automatically as of the effective date of each change in the Maximum Corporate Tax Rate. As used herein: (1) "Code" means the Internal Revenue Code of 1986, as amended, and any Treasury Regulations, whether temporary, proposed or final, promulgated thereunder or applicable thereto; and (2) "Maximum Corporate Tax Rate" means, as of any date of determination, the highest marginal tax rate (expressed as a decimal) applicable to the taxable income of corporations (as currently set forth in Section 11 of the Code) without regard to any increase in tax designated to JDC/B.MISC/233859-2/13524.003 8 normalize the rate for all income at the highest marginal tax rate or to phase out the benefit of graduated tax rates and impose a flat -tax at a specified rate (for example, the tax imposed by the last two sentences of Section 11(b)(1) of the Code as in effect on the original issue date of the Bonds), which rate on the original issue date of the Bonds is 35. The principal of this Bond shall be payable in eighteen (18) annual installments on each December 1, commencing December 1, 2002 (each a "Scheduled Due Date"). The amount of each such installment shall be as follows: Principal Year Installment Due 2002 $355,000 2003 375,000 2004 390,000 2005 410,000 2006 430,000 2007 455,000 2008 475,000 2009 500,000 2010 525,000 2011 550,000 2012 580,000 2013 610,000 2014 640,000 2015 670,000 2016 705,000 2017 740,000 2018 775,000 2019 815,000 Attached hereto as Schedule I is a debt service schedule for the Bonds based upon the above interest rate and principal payment schedule. 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 prepayment in whole or in part at any time at a price of par plus accrued interest to the date of prepayment, plus a premium equal to the "Prepayment Fee" described below, upon written notice to the Owners thereof given by the Village at least three (3) days prior to the date fixed for prepayment. Partial prepayments shall be applied to the maturities of principal installments in any order determined by the Village. JDC/B.MISC/233859-2/13524.003 a9 [Insert Final Prepayment Provisions] 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 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. 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 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 JDC/B.MISC/233859-2/13524.003 :10 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. 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 JDC/B.MISC/233859-2/13524.003 11 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 , 1999. VILLAGE OF KEY BISCAYNE, FLORIDA Mayor Village Clerk (SEAL) JDC/B.MISC/233859-2/13524.003 12 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 under Uniform Gifts to Minors the entirety Act of (State) IT TEN - as joint tenants with right of survivorship and not as tenants in common Additional abbreviations may also be used though not in the list above. [Attach Schedule I - Debt Service Schedule] JDC/B.MISC/233859-2/13524.003 • 13 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 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. 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 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. fond fund. There is hereby created a fund entitled "Village of Key Biscayne, Florida Land Acquisition and Capital Improvement Revenue Bonds, Series 1999 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 JDC/B.MISC/233859-2/13524.003 14 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; (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 funds. (g) Any other investments that at the time are legal investments for municipal JDC/B.MISC/233859-2/13524.003 15 Section 10. Application of bond proceeds. The proceeds received upon the sale of the Bonds shall be applied simultaneously with the delivery of the Bond as follows: 1. The Village shall first use the moneys to pay costs of issuance of the Bonds. 2. The remainder of the proceeds of the sale of the Bonds shall be deposited in the "Village of Key Biscayne Land Acquisition and Capital Improvement Revenue Bonds, Series 1999 Project Fund" (the "Project Fund"), hereby created, and used only in connection with the Project. 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. Such funds 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. 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. 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. JDC/B.MISC/233859-2/13524.003 16 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 1999 and neither the Village nor any such entities expect to issue tax-exempt obligations during calendar year 1999, other than the Bonds and the Village's $7,200,000 Stormwater Utility Revenue Bonds, Series 1999, which were treated as qualified tax-exempt obligations under Section 265(b)(3)(D)(ii) of the Code. 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 1999 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 Rebate Fund the amounts required to be transferred in order to comply with the Rebate Covenants, 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 15 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. JDC/B.MISC/233859-2/13521.003 17 Section 15. Special Covenants. 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. Section 16. Covenants binding on Village and Successor. All covenants, stipulations, obligations and agreements of the Village contained in this Resolution 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. 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 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 is proceeding diligently with action to correct such default; or JDC/B.MISC/233859-2/13524.003 18 (d) any proceeding shall be instituted with the consent of the Village 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 such proceedings shall not have been dismissed within thirty (30) days after the institution of the same. Section 18. Remedies; Rights of bond holders. 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 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. 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. (a) by paying the principal of, Prepayment Fee, if any, and interest on the Bonds when the same shall become due and payable; or (b) 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, redemption premium, if any, and interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof; or (c) 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, redemption premium, if any, and interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof. JDC/B.MISC/233859-2/13521.003 19 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 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. (d) Notwithstanding the foregoing, all references to the discharge and satisfaction of Bonds shall include the discharge and satisfaction of any portion of the Bonds. (e) 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. (f) 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. JDC/B.MISC/233859-2/13524.003 20 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 (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. Ratification of Village Manager's actions. The Village Council hereby ratifies the actions of the Village Manager in locking in the interest rate on the Bonds on July 21, 1999, as evidenced by the Village Manager's letter attached hereto as Exhibit "B". Section 25. 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 26. Repealing clause. All resolutions or orders and parts thereof in conflict herewith, to the extent of such conflicts, are hereby superseded and repealed. Section 27. Effective Date. This Resolution shall take effect immediately upon its passage and adoption. JDC/B.MISC/233859-2/13524.003 21 PASSED AND ADOPTED this 23rd day of July, 1999. JOE I. RASCO, MAYOR CONCHITA H. ALVAREZ, VILLAGE CLERK APPROVED AS TO LEGAL FORM AND SUFFICIENCY: 22 EXHIBIT "A" The Bonds are subject to prepayment in whole or in part at any time on at a price of par plus accrued interest to the date of prepayment, plus a premium equal to the "Prepayment Fee" described below, upon written notice to the Owners thereof given by the Village at least three (3) days prior to the date fixed for prepayment. Partial prepayments shall be applied to the maturities of principal installments in any order determined by the Village. For each date on which a prepayment occurs ("Prepayment Date"), a Prepayment Fee shall be due only if the rate under "A" below exceeds the rate under "B" below and shall be determined as follows: Prepayment Fee = the Present Value of ((A -B) x C) + LIBOR Breakage, where: A = A rate per annum equal to the sum of (1) the bond equivalent yield (bid side) of the U.S. Treasury security with a maturity closest to the Scheduled Due Date(s) to be prepaid as reported by the Wall Street Journal (or other published source) on July 22, 1999 ("Lock In Date"), plus (ii) the corresponding swap spread of the Bank on the Lock In Date for a fixed rate payor to pay the Bank the fixed rate side of an interest rate swap of that maturity, plus (iii) .25%. B = A rate per annum equal to the sum of (i) the bond equivalent yield (bid side) of the U.S. Treasury security with a maturity closest to the Scheduled Due Date(s) to be prepaid as reported by the Wall Street Journal (or other published source) on the Prepayment Date, plus (ii) the corresponding swap spread that the Bank determines another swap dealer would quote to the Bank on the Prepayment Date for paying to the Bank the fixed rate side of an interest rate swap of that maturity. C = The sum of the products of (i) each Affected Principal Amount for each Affected Principal Period, times (ii) the number of days in that Affected Principal Period divided by 360. "Affected Principal Amount" for an Affected Principal Period is the principal amount of the Bonds so prepaid. "Affected Principal Period" is each period from and including a Scheduled Due Date to but excluding the next Scheduled Due Date, provided that the first such period shall begin on and includes the Prepayment Date. "LIBOR Breakage" is any additional loss, cost or expense that the Bank may incur with respect to any hedge for the fixed rate of the Bond based on the difference A-1 between the London interbank offered rate (for U.S. dollar deposits of the relevant maturity) available in the London interbank market at the beginning of the interest period in which the Prepayment Date occurs and that which is available in that market on the Prepayment Date. "Present Value" is determined as of the Prepayment Date using "B" above as the discount rate. Prepayment Fees are payable as liquidated damages, are a reasonable pre -estimate of the losses, costs and expenses the Bank would incur for any prepayment, are not a penalty, will not require claim for, or proof of, actual damages, and the Bank's determination thereof shall be conclusive and binding in the absence of manifest error. , A-2 EXHIBIT ((t.3" July 21, 1999 Ms. Jean Bell Bank of America, NA., d/b/a NationsBa k, N.A. 100 S.L. 2nd Street, 15th Floor Miami, Florida 33131 Re; 510,000,000 Village of Key Biscayne, Florida Land Acquisition and Capital Improvement Revenue Bonds, Series 1999 Dear Jean: This will confirm that as of today you have agreed to lock in the interest rate on the above - captioned bonds (the"Bonds"). The Village hereby agrees that if the Bond issue does not close on or prior to August 16, 1999, the Village will pay the Bank a Prepayment Foo determined in accordance with attached Exhibit "A,". Village of Key Biscayne, Florida By: Date: July 21, 1999 lnc/a.►t=ac/3u612e/33524.DO) C. Samuel Kissinger, V go Manager • • EXHIBIT "A" The principal of the Bonds shall be payable in eighteen (18) annual installments on each December 1, commencing December 1, 2002 (each a "Scheduled Due Date"). The amount of each such installment shall be as follows: Principal Year Installment Due 2002 $355,000 2003 375,000 2004 390,000 2005 410,000 2006 430,000 2007 455,000 2008 475,000 2009 500,000 2010 525,000 2011 550,000 2012 580,000 2013 610,000 2014 640,000 2015 670,000 2016 705,000 2017 740,000 2018 775,000 2019 815,000 The Bonds are subject to prepayment in whole or in part at any time on at a price of par plus accrued interest to the date of prepayment, plus a premium equal to the "Prepayment Fee" described below, upon written notice to the Owners thereof given by the Village at least three (3) days prior to the date fixed for prepayment. Partial prepayments shall be applied in inverse order of the maturity of principal installments. For each date on which a prepayment occurs ("Prepayment Date"), a Prepayment Fee shall be due only if the rate under "A" below exceeds the rate under "B" below and shall be determined as follows: Prepayment Fee = the Present Value of ((A -B) x C) + LIBOR Breakage, where: A= JDC/B.MISC/235423/13524.003 A rate per annum equal to the sum of (1) the bond equivalent yield (bid side) of the U.S. Treasury security with a maturity closest to the Scheduled Due Date(s) to be prepaid as reported by the Wall Street Journal (or other published source) on July 22, 1999 ("Lock In Date"), plus (ii) the corresponding swap spread of the Bank on the Lock In Date for a fixed rate A-1 payor to pay the Bank the fixed rate side of an interest rate swap of that maturity, plus (iii) .25%. B = A rate per annum equal to the sum of (i) the bond equivalent yield (bid side) of the U.S. Treasury security with a maturity closest to the Scheduled Due Date(s) to be prepaid as reported by the Wall Street Journal (or other published source) on the Prepayment Date, plus (ii) the corresponding swap spread that the Bank determines another swap dealer would quote to the Bank on the Prepayment Date for paying to the Bank the fixed rate side of an interest rate swap of that maturity. C The sum of the products of (i) each Affected Principal Amount for each Affected Principal Period, times (ii) the number of days in that Affected Principal Period divided by 360. "Affected Principal Amount" for an Affected Principal Period is the principal amount of the Bonds so prepaid. "Affected Principal Period" is each period from and including a Scheduled Due Date to but excluding the next Scheduled Due Date, provided that the first such period shall begin on and includes the Prepayment Date. "LIBOR Breakage" is any additional loss, cost or expense that the Bank may incur with respect to any hedge for the fixed rate of the Bond based on the difference between the London interbank offered rate (for U.S. dollar deposits of the relevant maturity) available in the London interbank market at the beginning of the interest period in which the Prepayment Date occurs and that which is available in that market on the Prepayment Date. "Present Value" is determined as of the Prepayment Date using "B" above as the discount rate. Prepayment Fees are payable as liquidated damages, are a reasonable pre -estimate of the losses, costs and expenses the Bank would incur for any prepayment, are not a penalty, will not require claim for, or proof of, actual damages, and the Bank's determination thereof shall be conclusive and binding in the absence of manifest error. JDC/B.MISC/235423/13524.003 A-2