Okaloosa County BOCC — February 18, 2014 — Inducement Resolution — reading text

"Project"), (2) refinancing certain outstanding indebtedness of the Borrower, (3) funding any necessary reserves, and (4) paying costs associated with issuance of the Series 2014 Bonds. The Project will be owned and operated by the Borrower. The Series 2014 Bonds shall be payable solely from the revenues derived by the County from a loan agreement, mortgage and security agreement and other financing documents to be entered into by and between the County and the Borrower prior to or contemporaneously with the issuance of the Series 2014 Bonds. Such Series 2014 Bonds and the interest thereon shall not constitute an indebtedness or pledge of the general credit or taxing power of the County, the State of Florida or any political subdivision or agency thereof. Issuance of the Series 2014 Bonds shall be subject to several conditions, including satisfactory documentation, the approval by bond counsel as to the tax-exempt status of the interest on all or a portion of the Series 2014 Bonds and receipt of necessary approvals for the financing. The aforementioned meeting shall be a public meeting and all persons who may be interested will be given an opportunity to be heard concerning the same. Written comments may also be submitted to the Board of County Commissioners of Okaloosa County, Florida prior to the hearing at 101 E. James Lee Boulevard, Crestview, Florida 32536, Attention: Don Howard, Clerk. ALL PERSONS FOR OR AGAINST SAID APPROVAL CAN BE HEARD AT SAID TIME AND PLACE. IF A PERSON DECIDES TO APPEAL ANY DECISION MADE BY THE COUNTY WITH RESPECT TO SUCH HEARING OR MEETING, (S)HE WILL NEED TO ENSURE THAT A VERBATIM RECORD OF SUCH HEARING OR MEETING IS MADE, WHICH RECORD INCLUDES THE TESTIMONY AND EVIDENCE UPON WHICH THE APPEAL IS BASED. In accordance with the Americans with Disabilities Act, persons needing a special accommodation to participate in this proceeding should contact Okaloosa County no later than seven days prior to the proceeding at the address given in this notice or phone 850/689-5000. A-1  EXHIBIT B MEMORANDUM OF AGREEMENT FOR ISSUANCE OF PRIVATE ACTIVITY REVENUE BONDS This Memorandum of Agreement (the "Agreement") is between Okaloosa County, Florida, a political subdivision of the State of Florida (the "County") and Auburn Water System, Inc., a Florida not-for-profit corporation (the "Borrower"). WITNESSETH: 1. Preliminary Statement. Among the matters of mutual understanding and inducement which have resulted in the execution of this Agreement are the following: (a) Whereas Chapter 159, Part II, Florida Statutes (the "Act") provides that the County may issue tax-exempt revenue bonds and loan the proceeds thereof to one or more persons, firms or private corporations, or use such proceeds, to defray the cost of acquiring, by purchase or by construction, certain qualifying manufacturing and water facilities as defined in the Act. (b) The Borrower is considering financing and refinancing all or a portion of the costs of acquiring, constructing and equipping of improvements to its existing utilities system located at _____________ in Okaloosa County, Florida (the "Project"). The Project will be owned and operated by the Borrower. In connection therewith, the Borrower also intends to refund certain outstanding indebtedness of the Borrower (the "Refunded Indebtedness"). (c) The County intends this Agreement to constitute its official initial commitment, subject to the terms hereof, to issue its bonds (the "Series 2014 Bonds") in one or more series or issues pursuant to a plan of finance and the Act in the amount to be agreed upon by the County and the Borrower and to loan the proceeds thereof to the Borrower to finance and refinance the costs of the Project, including all costs incurred in connection with the issuance of the Series 2014 Bonds by the County and the Borrower, up to an amount not to exceed $5,000,000 initial aggregate principal amount. (d) The County considers the issuance and sale of the Series 2014 Bonds, for the purposes hereinabove set forth, consistent with the objectives of the Act. This commitment is an affirmative official action of the County toward the issuance of the Series 2014 Bonds as herein contemplated in accordance with the purposes of both the Act and the applicable United States Treasury Regulations. 2. Undertakings on the Part of the County. Subject to the terms hereof, the County agrees as follows: (a) Subject to the Borrower providing the County with sufficient evidence to enable the County to make the findings set forth in Section 159.29 of the Act, the County will authorize the issuance of the Series 2014 Bonds, in one or more series or issues, in the aggregate principal amount necessary and sufficient to finance all or a portion of the costs of the Project and the refunding of the Refunded Indebtedness, as the County and the Borrower shall agree in writing, B-1 but in all events, the principal amount of such Series 2014 Bonds shall not exceed the lesser of (i) the amount determined by the County and the Borrower necessary to accomplish the foregoing, or (ii) $5,000,000. (b) The County will cooperate with the Borrower and with the underwriters, placement agents or purchasers of the Series 2014 Bonds and the bond counsel of the County with respect to the issuance and sale of the Series 2014 Bonds and will take such further action and authorize the execution of such documents as shall be mutually satisfactory to the County and the Borrower for the authorization, issuance and sale of such Series 2014 Bonds and the use of the proceeds thereof to finance and refinance the costs of the Project. (c) The County may take further action to permit, in its sole discretion, the issuance from time to time in the future of additional bonds on terms which shall be set forth therein, whether pari passu with other series of bonds or otherwise, for the purpose of defraying the cost of completion, enlargements, improvements and expansions of the Project, or any segment thereof, or refunding of the Series 2014 Bonds. (d) The loan agreement, trust indenture, mortgage and other financing documents (collectively, the "Financing Agreements") between the County and the Borrower shall, under terms agreed upon by the parties, provide for payments to be made by the Borrower in such sums as shall be necessary to pay the amounts required under the Act, including the principal of and interest and redemption premium, if any, on the Series 2014 Bonds, as and when the same shall become due and payable. (e) The Series 2014 Bonds shall specifically provide that they are payable solely from the revenues derived pursuant to the Financing Agreements between the County and the Borrower or other agreements approved by the County, except to the extent payable out of amounts attributable to Bond proceeds. The Series 2014 Bonds and the interest thereon shall not constitute an indebtedness or pledge of the general credit of the County, the State of Florida or any political subdivision or agency thereof, and such fact shall be plainly stated on the face of the Series 2014 Bonds. (f) Issuance of the Series 2014 Bonds by the County shall be contingent upon compliance with all provisions of the Internal Revenue Code of 1986, as amended (the "Code"), and the regulations promulgated thereunder, including the ability of and desirability by the County to issue obligations to fund the costs of the Project. 3. Undertakings on the Part of the Borrower. Subject to the terms hereof, the Borrower agrees as follows: (a) The Borrower will use reasonable efforts to ensure that the Series 2014 Bonds in the aggregate principal amount as stated above are sold; provided, however, that the terms of such Series 2014 Bonds and the sale and delivery thereof shall be mutually satisfactory to the County and the Borrower. (b) Prior to the issuance of the Series 2014 Bonds in the principal amount stated above, in one or more series or issues from time to time as the County and the Borrower shall agree in writing, the Borrower will enter into the Financing Agreements with the County, the B-2 terms of which shall be mutually agreeable to the County and Borrower, providing for the loan or use of the proceeds of the Series 2014 Bonds to finance the costs of the Project and the refunding of the Refunded Indebtedness. Such Financing Agreements will provide that the Borrower will be obligated to pay the County (or the trustee for holders of the Series 2014 Bonds on behalf of the County, as the case may be) sums sufficient in the aggregate to enable the County to pay the principal of and interest and redemption premium, if any, on the Series 2014 Bonds, as and when the same shall become due and payable, and all other expenses related to the issuance and delivery of the Series 2014 Bonds. (c) The Borrower shall, in addition to paying the amounts set forth in the Financing Agreements, pay all costs of operation, maintenance, taxes, governmental and other charges which may be assessed or levied against or with respect to the Project. (d) To the extent not otherwise paid from Bond proceeds as part of the costs of the Project, the Borrower hereby agrees to pay all of the reasonable out of pocket expenses of officials and representatives of the County incurred in connection with the issuance of the Series 2014 Bonds and will pay fees and expenses of the County, including those of the County Attorney. (e) In the event the Series 2014 Bonds are not issued (other than by reason of the County electing not to proceed with the financing), the Borrower hereby agrees to pay the out of pocket expenses of the officials and representatives of the County incurred in connection with the issuance of the Series 2014 Bonds, including those of the County Attorney, on a time and materials basis in accordance with the usual hourly fees chargeable to the County under their respective contracts. (f) The Borrower will hold the County free and harmless from any loss or damage and from any taxes or other charges levied or assessed by reason of any mortgaging or other disposition of the Project. (g) The Borrower agrees to indemnify and defend the County and hold the County harmless against any and all claims, losses, liabilities or damages to property or any injury or death of any person or persons occurring in connection with the financing and refinancing of the Project or the issuance of the Series 2014 Bonds and the Borrower's undertaking thereof, or in any way growing out of or resulting from this Agreement, including, without limitation, all costs and expenses of the County and reasonable attorneys' and legal assistants' fees incurred in the enforcement of any agreement of the Borrower contained herein. In the event that the Series 2014 Bonds are not issued and delivered, this indemnity shall survive the termination of this Agreement. (h) The Borrower will take such further action as may be required to implement its aforesaid undertakings and as it may deem appropriate in pursuance thereof. 4. General Provisions. All commitments of the County under Section 2 hereof and of the Borrower under Section 3 hereof are subject to the conditions that all of the following events shall have occurred not later than November 30, 2014, or such other date as shall be mutually satisfactory to the County and Borrower: B-3  (a) The County shall be