Fort Walton Beach Council agenda — 01-08-13--regular — reading text

with the provisions hereof. 2) The Local Borrower currently is not the subject of bankruptcy, insolvency, or reorganization proceedings and is not in default of, or otherwise subject to, any agreement or any law, administrative regulation, judgment, decree, note, resolution, charter or ordinance which would currently restrain or enjoin it from entering into, or complying with, this Agreement. 3) There is no material action, suit, proceeding, inquiry or investigation, at law or in equity, before any court or public body, pending or, to the best of the Local Borrower' s knowledge, threatened, which seeks to restrain or enjoin the Local Borrower from entering into or complying with this Agreement. 4) All permits, real property interests, and approvals required as of the date of this Agreement have been obtained for construction and use of the Project. The Local Borrower knows of no reason why any future required permits or approvals are not obtainable. 5) The Local Borrower shall undertake the Project on its own responsibility, to the extent permitted by law. 6) To the extent permitted by law, the Local Borrower shall release and hold harmless the State, its agencies, the Corporation, and each of their respective officers, members, and employees from any claim arising in connection with the Local Borrower' s actions or omissions in its planning, engineering, administrative, and construction activities financed by this Loan or its operation of the Project. 7) All Local Borrower representations to the Corporation and the Department, pursuant to the Loan Application and this Agreement, were and are true and accurate as of the Packet Pg. 97  14.2. b date the Loan Application and this Agreement were each executed by the Local Borrower. The financial information delivered by the Local Borrower to the Department was current and correct as of the date such information was delivered. The Local Borrower shall comply with Chapter 62 -503, Florida Administrative Code, and all applicable State and Federal laws, rules, and regulations which are identified in the Loan Application or this Agreement. To the extent that any assurance, representation, or covenant requires a future action, the Local Borrower shall take such action as is necessary for compliance. V 8) The Local Borrower shall maintain records using generally accepted o a governmental accounting principles established by the Governmental Accounting Standards Board. As part of its bookkeeping system, the Local Borrower shall keep accounts of the Water c z and Sewer Systems separate from all other accounts and it shall keep accurate records of all a revenues, expenses, and expenditures relating to the Water and Sewer Systems, and of the Pledged Revenues, Loan disbursement receipts and Loan Debt Service Account. ym 9) In the event the anticipated Pledged Revenues are shown by the Local Borrower' s E a annual budget to be insufficient to make the Semiannual Loan Payments for such Fiscal Year when due, the Local Borrower shall include in such budget other legally available non -ad valorem funds which will be sufficient, together with the Pledged Revenues, to make the m Semiannual Loan Payments. Such other legally available non -ad valorem funds shall be i budgeted in the regular annual governmental budget and designated for the purpose provided by this Subsection, and the Local Borrower shall collect such funds for application as provided herein. The Local Borrower shall notify the Department immediately in writing of any such o budgeting of other legally available non -ad valorem funds. Nothing in this covenant shall be 0 construed as creating a pledge, lien, or charge upon any such other legally available non -ad M. valorem funds; requiring the Local Borrower to levy or appropriate ad valorem tax revenues; or preventing the Local Borrower from pledging to the payment of any bonds or other obligations M all or any part of such other legally available non -ad valorem funds. 10) Each Fiscal Year, beginning three months before the first Semiannual Loan Payment and ending with the Fiscal Year during which the final Loan repayment is made, the Local Borrower' s Authorized Representative or its chief financial officer shall submit, pursuant to the schedule established in Section 10. 07, a certification that: ( a) Pledged Revenues collections satisfy, on a pro rata basis, the rate coverage requirement; ( b) the Loan Debt Service Account contains the funds required; and ( c) insurance, including that issued through the National Flood Insurance Program authorized under 42 U. S. C. secs. 4001 -4128 when applicable, in effect for the facilities generating the Pledged Revenues, adequately covers the customary risks to the extent that such insurance is available. 11) Pursuant to Section 216. 347 of the Florida Statutes, the Local Borrower shall not use the Loan proceeds for the purpose of lobbying the Florida Legislature, the Judicial Branch, or a State agency. 12) The Local Borrower agrees to construct the Project in accordance with the Project schedule. Delays incident to strikes, riots, acts of God, and other events beyond the reasonable control of the Local Borrower are excepted. If for any reason construction is not completed as PacketPg. 98  14.2. b scheduled, there shall be no resulting diminution or delay in the Semiannual Loan Payment or the Monthly Loan Deposit. 13) The Local Borrower covenants that this Agreement is entered into for the purpose of constructing, refunding, or refinancing the Project which will in all events serve a public purpose. The Local Borrower covenants that it will, under all conditions, complete and operate the Project to fulfill the public need. 14) The Local Borrower shall take such actions, shall furnish and certify to such information and execute and deliver and cause to be executed and delivered such documents, certificates and opinions as the Corporation and /or the Department may reasonably require in connection with the Bonds, including, without limitation, any necessary continuing disclosure undertaking meeting the requirements of Securities and Exchange Commission Rule 15c2 - 12. 2. 02. TAX WARRANTIES, REPRESENTATIONS AND COVENANTS The Local Borrower acknowledges that the Corporation may issue Tax -Exempt Bonds with which to fund the Loan to the Local Borrower and that the maintenance of the tax -exempt status of any such Tax- Exempt Bonds will depend, in part, on the Local Borrower' s compliance with the provisions of this Agreement. Accordingly, the Local Borrower warrants, represents and covenants that: l) Notwithstanding any other provisions of this Agreement, including specifically A Section 2. 02( 8), if the Local Borrower shall be notified by the Corporation or the Department as of any date that any payment is required to be made to the United States Treasury in respect of Tax- Exempt Bonds the proceeds of which were used to fund the Loan ( hereafter, the " Applicable Tax -Exempt Bonds "), and such payment is due to the failure of the Local Borrower to comply with this Agreement, the Local Borrower shall pay to the Trustee ( for deposit to the applicable ry Subaccount of the Rebate Account established by the Indenture) the amount specified in the notice by the Corporation or the Department. a 2) The Local Borrower is a " governmental person" ( as defined in Treasury Regulations § 1. 141 - 1( b)) ( a " Governmental Unit") and it owns and operates the Project. 3) The Local Borrower will not take any action or omit to take any action, which action or omission will adversely affect the exclusion from gross income of the interest on the Applicable Tax -Exempt Bonds for federal income tax purposes or cause the interest on the Applicable Tax- Exempt Bonds, or any portion thereof, to become an item of tax preference for purposes of the alternative minimum tax imposed on individuals and corporations under the Code, and in the event of such action or omission, promptly upon having such brought to its attention, it will take such reasonable actions based upon an opinion of any attorney or firm of attorneys of recognized standing and experience in the field of municipal bonds whose opinions are generally accepted by purchasers of municipal bonds and which attorney or firm of attorneys is acceptable to the Corporation ( " Bond Counsel "), and in all cases at the sole expense of the Local Borrower, as may rescind or otherwise negate such action or omission. The Local Borrower will not directly or indirectly, use or permit the use of any proceeds of the Applicable Tax -Exempt Bonds or any other funds of the Local Borrower, or take or omit to take any action, Packat Pg. 99  14. 2. b that would cause the Applicable Tax -Exempt Bonds to be or become " arbitrage bonds" within the meaning of Section 148( a) of the Code or to fail to meet any other applicable requirement of Sections 141, 148, 149 and 150 of the Code or cause the interest on the Applicable Tax -Exempt Bonds, or any portion thereof, to become an item of tax preference for purposes of the alternative minimum tax imposed on individuals and corporations under the Code. To that end, the Local Borrower will comply with all requirements of Sections 141, 148, 149 and 150 of the Code to the extent such provisions apply to the Applicable Tax- Exempt Bonds. In the event that at any time the Corporation or the Department is of the opinion that it is necessary to restrict or limit the yield on the investment of any moneys held by the Local Borrower, the Corporation or the Department shall so instruct the Local Borrower in writing and the Local Borrower shall so restrict the yield. 4) The Local Borrower ( or any " related party ", as defined in Treasury Regulations 1. 150 - 1( b)) is prohibited from purchasing and shall not purchase any Applicable Tax -Exempt Bonds other than purchases in the open market for the purpose of tendering them to the Trustee for purchase and retirement. 5) The Local Borrower will take no action, or permit or suffer any action or event, which will cause any of the Applicable Tax -Exempt Bonds to be or become a " private activity bond" within