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

registered in the State, shall be employed by, or under contract with, the Local Borrower to oversee construction. 4. 05. PROHIBITION AGAINST ENCUMBRANCES. The Local Borrower is prohibited from selling, leasing, or disposing of any part of the Water or Sewer System which would materially reduce operational integrity or Gross Revenues so long as this Agreement, including any amendment thereto, is in effect unless the written consent of the Department is first secured. 4. 06. COMPLETION MONEYS. In addition to the proceeds of this Loan, the Local Borrower covenants that it has obtained, or will obtain, sufficient moneys from other sources to complete construction and place the Project in operation on, or prior to, the date specified in Article X. Failure of the Corporation or the Department to approve additional financing shall not constitute a waiver of the Local Borrower' s covenants to complete and place the Project in operation. 4. 07. CLOSE -OUT. The Department shall conduct a final inspection of the Project and Project records. Following the inspection, deadlines for submitting additional disbursement requests, if any, shall be established, along with deadlines for uncompleted Loan requirements, if any. Deadlines shall 18 Packet Pg. 110  14.2. b be incorporated into the Loan Agreement by amendment. The Loan principal shall be reduced by any excess over the amount required to pay all approved costs. As a result of such adjustment, the Semiannual Loan Payment shall be reduced accordingly, as addressed in Section 10. 05. 4. 08. LOAN DISBURSEMENTS. Disbursements shall be made only by the Trustee for expenses incurred by the Local Borrower upon receipt of a requisition in the form provided under the Indenture executed by the Department. Disbursements shall be made directly to the Local Borrower for allowance costs and reimbursement of the incurred construction costs and related services. Disbursement of the allowance costs shall be made upon the Department' s receipt of a disbursement request form. Up to seventy percent of the estimated allowance shall be disbursed after the Loan Agreement is signed. The remainder of the allowance shall be disbursed after all procurement contracts are executed and shall be adjusted to reflect as -bid costs. The entire estimated allowance may be disbursed after the Loan Agreement is signed if the Local Borrower agrees to an allowance adjustment after all contracts have been bid. Loan disbursements shall be made by electronic means. Disbursements shall be made directly to the Local Borrower for reimbursement of the incurred construction costs and related services and technical services during construction. A requisition for disbursements shall be made upon receipt by the Department of the following: 1) A completed disbursement request form signed by the Authorized Representative. Such requests must be accompanied by sufficiently itemized summaries of the materials, labor, or services to identify the nature of the work performed; the cost or charges for such work; and the person providing the service or performing the work. 2) A certification signed by the Authorized Representative as to the current estimated costs of the Project; that the materials, labor, or services represented by the invoice have been satisfactorily purchased, performed, or received and applied to the Project; that all funds received to date have been applied toward completing the Project; and that under the terms and provisions of the contracts, the Local Borrower is required to make such payments. 3) A certification by the engineer responsible for overseeing construction stating that equipment, materials, labor and services represented by the construction invoices have been satisfactorily purchased, or received, and applied to the Project in accordance with construction contract documents; stating that payment is in accordance with construction contract provisions; stating that construction, up to the point of the requisition, is in compliance with the contract documents; and identifying all additions or deletions to the Project which have altered the Project' s performance standards, scope, or purpose since the issue of the Department construction permit. 4) Such other certificates or documents by engineers, attorneys, accountants, contractors, or suppliers as may reasonably be required by the Department. 19 Packet Pg. 111  14. 2. b ARTICLE V - RATES AND USE OF THE WATER AND SEWER SYSTEMS 5. 01. RATECOVERAGE. The Local Borrower shall maintain rates and charges for the services furnished by the Water and Sewer Systems which will be sufficient to provide, in each Fiscal Year, Pledged Revenues equal to or exceeding 1. 15 times the sum of the Semiannual Loan Payments due in such Fiscal Year. In addition, the Local Borrower shall satisfy the coverage requirements of all senior and parity debt obligations. 5. 02. NO FREE SERVICE. The Local Borrower shall not permit connections to, or furnish any services afforded by, the Water or Sewer System without making a charge therefor based on the Local Borrower' s uniform schedule of rates, fees, and charges. 5. 03. MANDATORY CONNECTIONS. The Local Borrower shall adopt, as necessary, and enforce requirements, consistent with applicable laws, for the owner, tenant or occupant of each building located on a lot or parcel of land which is served, or may reasonably be served, by the Sewer System to connect such building to the Sewer System. 5. 04. NO COMPETING SERVICE. The Local Borrower shall not allow any person to provide any services which would W compete with the Water or Sewer System so as to adversely affect Gross Revenues. Wn 5. 05. MAINTENANCE OF THE WATER AND SEWER SYSTEMS. The Local Borrower shall operate and maintain the Water and Sewer Systems in a proper, sound and economical manner and shall make all necessary repairs, renewals and replacements. 5. 06. ADDITIONS AND MODIFICATIONS. The Local Borrower may make any additions, modifications or improvements to the Water and Sewer Systems which it deems desirable and which do not materially reduce the operational integrity of any part of the Water or Sewer System. All such renewals, replacements, additions, modifications and improvements shall become part of the Water and Sewer Systems. 5. 07, COLLECTION OF REVENUES. The Local Borrower shall use its best efforts to collect all rates, fees and other charges due to it. The Local Borrower shall establish liens on premises served by the Water or Sewer System for the amount of all delinquent rates, fees and other charges where such action is permitted by law. The Local Borrower shall, to the full extent permitted by law, cause to discontinue the services of the Water and Sewer Systems and use its best efforts to shut off water 20 Packet Pg. 112  14.2. b service furnished to persons who are delinquent beyond customary grace periods in the payment of Water and Sewer System rates, fees and other charges. ARTICLE VI - DEFAULTS AND REMEDIES 6. 01. EVENTS OF DEFAULT. Each of the following events is hereby declared an event of default: 1) Failure to make any Monthly Loan Deposit when it is due and such failure shall continue for a period of 30 days or failure to make any installment of the Semiannual Loan Payment when it is due and such failure shall continue for a period of 5 days. 2) Except as provided in Subsections 6. 01( 1) and 6: 01( 7), failure to comply with the provisions of this Agreement or failure in the performance or observance of any of the covenants or actions required by this Agreement and such failure shall continue for a period of 60 days after written notice thereof to the Local Borrower by the Department. 3)Any warranty, representation or other statement by, or on behalf of, the Local Borrower contained in this Agreement or in any document, certificate or information furnished in compliance with, or in reference to, this Agreement, which is false or misleading. 4) An order or decree entered, with the acquiescence of the Local Borrower, appointing a receiver of any part of the Water or Sewer System or Gross Revenues thereof; or if such order or decree, having been entered without the consent or acquiescence of the Local Borrower, shall not be vacated or discharged or stayed on appeal within 60 days after the entry thereof. 5) Any proceeding instituted, with the acquiescence of the Local Borrower, for the purpose of effecting a composition between the Local Borrower and its creditors or for the w a purpose of adjusting the claims of such creditors, pursuant to any federal or state statute now or hereafter enacted, if the claims of such creditors are payable from Gross Revenues of the Water d or Sewer System. a 6)Any bankruptcy, insolvency or other similar proceeding instituted by, or against, the Local Borrower under federal or state bankruptcy or insolvency law now or hereafter in effect and, if instituted against the Local Borrower, is not dismissed within 60 days after filing. 7) Failure of the Local Borrower to give immediate written notice of default to the Department and such failure shall continue for a period of 30 days. 6. 02. REMEDIES. Upon any event of default and subject to the rights of others having prior liens on the Pledged Revenues, the Department may enforce the rights of the Corporation and the Department by any of the following remedies: 21 Pack Pg. 113  14.2. b 1) By mandamus or other proceeding at law or in equity, cause to establish rates and collect fees and charges for use of the Water and Sewer Systems, and to require the Local Borrower to fulfill this Agreement. 2) By action or suit in equity, require the Local Borrower to account for all moneys received pursuant to this Agreement or from the ownership of the Water and Sewer Systems and to account for the receipt, use, application, or disposition of the Pledged Revenues. 3) By action or suit in equity, enjoin any acts or things which may be unlawful or in violation of the rights of the Corporation or the Department. 4) By applying to a