Fort Walton Beach Resolution — 2013-12--Capital Improvement Revenue — reading text

annual budget for the purposes and in the manner stated herein shall have the effect of making available for the payment of principal and interest on the Note, in the manner described herein, Non -Ad Valorem Revenues and placing on the City a positive duty to appropriate and budget, by amendment, if necessary, amounts sufficient to meet its obligations hereunder; subject, however, to the payment of services and programs which are for essential public purposes affecting the health, welfare and safety of the inhabitants of the City or which are legally mandated by applicable law and further subject to the restrictions of Section 166. 241, Florida Statutes, insofar as there are not sufficient Non -Ad Valorem Revenues to comply with such covenant after the satisfaction of the funding requirements for obligations having an express lien on or pledge of such revenues and the funding requirements for essential governmental services of the City. The City agrees that its covenant and agreement to budget and appropriate Non -Ad Valorem Revenues shall be deemed entered into for the benefit of the holders of the Note, and this obligation may be enforced by a court of competent jurisdiction. The Note shall not constitute a general obligation or indebtedness of the City and the Lender shall never have the right to require or compel the levy of taxes upon any property of or in the City for the payment of the principal of and interest on the Note. The City does hereby irrevocably pledge the Pledged Funds to the payment of the principal of and interest on the Note. SECTION 10. COVENANTS OF THE CITY. So long as any of the principal of or interest on the Note shall be outstanding and unpaid or until provision for payment of the Note shall have been made pursuant to Section 21 hereof, the City covenants with the Lender as follows: A. Tax Compliance. The City will take all actions within its powers necessary to maintain the exclusion from gross income of interest on the Note to the same extent as such existed on the date of issuance of the Note, and all other actions within its powers necessary to maintain the status of the Note as a " qualified tax -exempt obligation" for purposes of Section 265 (b)( 3)( B) of the Code. B. Financial Statements. Not later than 180 days following the end of each Fiscal Year, the City shall provide the Lender ( in electronic format, if available) the annual audited financial statement of the City audited by the City' s certified public accountants together with the report of such accountants containing only such qualifications as are reasonably acceptable to the Lender. The City shall also provide the Lender with a certificate that no Event of Default has occurred and is continuing hereunder, and that the City is in compliance with all covenants on its part set forth herein. C. Annual Budget and Other Information. The City shall prepare its annual budget in accordance with Florida law, and shall provide the Lender a copy of its final annual budget for each Fiscal Year within 30 days of adoption thereof by the Council and such other information as the Lender may reasonably request. D. Sinking Fund. The City hereby creates and establishes a special, separate fund to be called the " City of Fort Walton Beach, Florida Capital Improvement Refunding Revenue Note, Series 2013 Sinking Fund" ( hereinafter called the " Sinking Fund'). On or before the Business Day prior to each date fixed for the payment of principal or interest on the Note, the City shall deposit from Non -Ad Valorem Revenues budgeted and appropriated pursuant to the covenant contained herein to the Sinking Fund the amounts sufficient to pay the interest and principal becoming due on the Note on the next payment date therefor. The amounts remaining on deposit in the Sinking Fund on the day following the respective interest or principal payment may be withdrawn by the City and applied for other City purposes. In no event shall any moneys remain on deposit in the Sinking Fund for a period greater than 13 months. Amounts on deposit in the Sinking Fund may be invested and reinvested by the City in Authorized Investments maturing or redeemable at the option of the City not later than the date such amounts are needed for the payments required hereunder. Except to the extent otherwise required by any provision hereof or of any tax compliance certificate delivered in connection with the delivery of the Note, all income from the investment of moneys in the fund and accounts established by this Agreement shall, upon receipt thereof, be deposited to the credit of the Sinking Fund and used for the purposes thereof. The designation of a special fund by this Agreement shall not be construed to require the establishment of any completely independent, self -balancing funds, as such term is commonly used and defined in governmental accounting, but is intended solely to constitute an earmarking of certain moneys and investments for certain purposes and to establish certain priorities for application of such moneys and investments as herein provided. The moneys and investments required to be accounted for in the foregoing fund established herein may be deposited in a single fund or account, provided that adequate accounting records are maintained to reflect the allocation of the moneys and investments on deposit therein into the fund established hereunder and to control the restricted uses of such moneys and investments for the various purposes as herein provided, The City shall not be required to make any further payments into the Sinking Fund when the aggregate amount of money and Authorized Investments in said funds and accounts is at least equal to the total principal of and interest on the Note then outstanding. E. Anti- Dilution. The City shall not incur additional debt secured by a lien on all or a portion of the Non -Ad Valorem Revenues or by a covenant to budget and appropriate unless it shall certify that the Non -Ad Valorem Revenues, after provision for essential governmental services, is no less than 1. 25 times the maximum annual debt service on ( i) all debt secured by a covenant to budget and appropriate from Non -Ad Valorem Revenues, ( ii) any debt payable from a lien on one or more specific Non -Ad Valorem Revenue sources, and ( iii) the proposed debt secured by a covenant to budget and appropriate or a specific lien on one or more Non -Ad Valorem Revenue sources. Such certificate shall be provided by the City Manager, SECTION 11. APPLICATION OF NOTE PROCEEDS. The proceeds of the Note shall be used by the City, together with other available funds, to refund the Refunded Bonds on May 7, 2013. The Lender shall have no responsibility for the use of the proceeds of the Note, and the use of Note proceeds by the City shall in no way affect the rights of the Lender or the obligations of the City hereunder or under the Note. SECTION 12. CONDITIONS PRECEDENT. The obligation of the Lender to make the disbursement of proceeds is subject to the satisfaction of each of the following conditions precedent on or before the closing date: A. Action. The Lender shall have received a copy of the Resolution certified as complete and correct as of the closing date. B. Incumbency of Officers. The Lender shall have received an incumbency certificate of the City in respect of each of the officers who is authorized to sign this Agreement and the financing documents to which it is a party on behalf of the City. C. Opinion of City Attorney. The Lender shall have received a written opinion of the City Attorney covering matters relating to the transactions contemplated by this Agreement and the financing documents, in form and substance satisfactory to the Lender. D. Opinion of Bond Counsel. The Lender shall have received an opinion from Bond Counsel in respect of the Note, in form and substance satisfactory to the Lender. The opinion shall, at a minimum, address ( i) the enforceability of the Resolution and this Agreement, ( ii) that this Agreement and Note creates the lien it purports to create on the 10 Pledged Funds and Non -Ad Valorem Revenues budgeted, appropriated and deposited in the Sinking Fund in accordance with its terms, ( iii) the status of interest on the Note being excluded from gross income for federal income tax purposes under the provisions of Section 103 of the Code and, ( iv) the designation of the Note as a " qualified tax - exempt obligation" under Section 265( b)( 3)( B) of the Code. E. No Default, Etc. No Default shall have occurred and be continuing as of the closing date or will result from the execution and delivery of this Agreement; the representations and warranties made by the City shall be true and correct in all material respects on and as of the closing date, as if made on and as of such date; and the Lender shall have received a certificate from the City to the foregoing effect. F. Other Documents. The Lender shall have received such other documents, certificates and opinions as the Lender or its counsel shall have reasonably requested. SECTION 13. REPRESENTATIONS AND WARRANTIES. The City represents and warrants to the Lender that: A. Organization. The City is a municipal corporation duly organized and validly existing under the laws of the State of Florida. B. Authorization of Agreement and Related Documents. The City has the power and has taken all necessary action to authorize the execution, delivery and performance of the City' s obligations under this Agreement and each of the financing documents to which it is a party in accordance with its respective terms. This Agreement has been duly executed and delivered by the City and is, and each of the financing documents to which it is a party when executed and delivered will be, legal, valid and binding obligations of the City enforceable against the City in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization or moratorium applicable to the City and general equitable principles regarding the availability of specific performance. C. Non -Ad Valorem Revenues. The City currently receives the Non -Ad Valorem Revenues, and is legally entitled to covenant to budget and appropriate from such Non -Ad Valorem Revenues sufficient amounts in each Fiscal Year to pay the principal of and interest on the Note, when due, subject to any prior liens or encumbrances on such Non -Ad Valorem Revenues, whether now existing or hereafter created. The Non -Ad Valorem Revenues are estimated to be sufficient to pay the principal of and interest on the Note as the same becomes due and to make all other payments required to be made from such Non -Ad Valorem Revenues by the terms of this Agreement or other instruments to which the City is a parry or pursuant to which all or any portion of the Non -Ad Valorem Revenues may be obligated. 11  D. Financial Statements. The financial statements of the City for the year ended September 30, 2012 copies of which have been famished to the Lender, have been prepared in accordance with generally accepted accounting principles applicable to governmental entities such as the City and present fairly the financial condition of the City as of such date and the results of its operations for the period then ended. Since such date, there has been no material adverse change in the financial condition, revenues including, without limitation,