Fort Walton Beach Resolution — 07-26-Defeasing 2005 Bond/Fairgrounds — reading text

dates and in the amounts set forth on Schedule A- I, the Escrow Holder, as trustee under the indentures which secure the Defeased Bonds, shall pay to the appropriate holders of Defeased Bonds, an amount equal to a sum sufficient to pay that portion of the Annual Refunded Bonds Debt Service for the Defeased Bonds coming due on such dates, as shown on Schedule A- I. ii) Surplus. After making the payments from the Defeased Bonds Escrow Account described in Subsection 4( i) above, the Escrow Holder shall retain in the Defeased Bonds Escrow Account any remaining cash in the Defeased Bonds Escrow Account in excess of the Defeased Bonds Escrow Requirement until the termination of this Agreement, and shall then pay any remaining funds to the Borrower. ill) Priority of Payments. The holders of the Defeased Bonds shall have an express first lien on the funds and investments in the Defeased Bonds Escrow Account until such funds and investments are used and applied as provided in this Agreement. 3  SECTION 5. Reinvestment. a) Except as provided in Section 3 and in this Section, the Escrow Holder shall have no power or duty to invest any funds held under this Agreement or to sell, transfer or otherwise dispose of or make substitutions of the investments held hereunder. b) At the written request of the Borrower and upon compliance with the conditions hereinafter stated, the Escrow Holder shall sell, transfer or otherwise dispose of any of the investments acquired hereunder and shall substitute other investments which constitute Federal Securities.The Borrower will not request the Escrow Holder to exercise any of the powers described in the preceding sentence in any manner which will cause interest on the Defeased Bonds or Bonds to be included in the gross income of the holders thereof for purposes of Federal income taxation. The transactions may be effected only if (i) an independent certified public accountant selected by the Issuer shall certify or opine in writing to the Issuer, the Borrower and the Escrow Holder that the cash and principal amount of investments remaining on hand after the transactions are completed will be not less than the applicable Escrow Requirement without taking into consideration any reinvestment of moneys held hereunder, and ( ii) to the extent that any of the Defeased Bonds or Bonds were issued on a tax- exempt basis, the Escrow Holder shall receive an opinion from a nationally recognized bond counsel acceptable to the Issuer and the Borrower to the effect that the transactions, in and by themselves, will not cause interest on such Defeased Bonds or Bonds to be included in the gross income of the holders thereof for purposes of Federal income taxation. SECTION 6. Notice of Redemption. The Escrow Holder, as trustee under the Indenture, is hereby instructed to mail, as soon as practicable following the execution of this Agreement, a Notice of Defeasance in the form attached hereto as Schedule C- l. SECTION 7. Responsibilities of Escrow Holder. The Escrow Holder and its respective successors, assigns, agents and servants shall not be held to any personal liability whatsoever, in tort, contract, or otherwise, in connection with the execution and delivery of this Agreement, the establishment of the Escrow Account, the acceptance of the funds deposited therein, the purchase of the investments, the retention of the investments or the proceeds thereof or for any payment, transfer or other application of moneys or securities by the Escrow Holder in accordance with the provisions of this Agreement or by reason of any non-negligent or non- willful act, omission or error of the Escrow Holder made in good faith in the conduct of its duties. The Escrow Holder shall, however, be responsible for its negligent or willful failure to comply with its duties required hereunder, and its negligent or willful acts, omissions or errors hereunder. The duties and obligations of the Escrow Holder shall be determined by the express provisions of this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Escrow Holder. The Escrow Holder may consult with counsel, who may or may not be counsel to the Issuer, and in reliance upon the opinion of such counsel, shall have full and complete authorization and protection in respect of any action taken, suffered or omitted by it in good faith in accordance therewith. Whenever the Escrow Holder shall deem it necessary or desirable that a matter be proved or established prior to taking, suffering or 4 omitting any action under this Agreement, such matter may be deemed to be conclusively established by a certificate signed by an authorized officer of the Issuer. SECTION 8. ResiiP'lation of Escrow Holder. The Escrow Holder may resign and thereby become discharged from the duties and obligations hereby created, by notice in writing given to the Issuer, the Borrower, any rating agency then providing a rating or insurer providing bond insurance on the Defeased Bonds, and the Trustee not less than sixty ( 60) days before such resignation shall take effect. Such resignation shall not take effect until the appointment of a new Escrow Holder hereunder. SECTION 9. Removal of Escrow Holder. a) The Escrow Holder may be removed at any time by an instrument or concurrent instruments in writing, executed by the holders of not less than fifty-one percentum ( 51%) in aggregate principal amount of the Defeased Bonds then outstanding, such instruments to be filed with the Issuer and the Borrower. A photographic copy of any instrument filed with the Borrower under the provisions of this paragraph shall be delivered by the Issuer to the Escrow Holder. b) The Escrow Holder may also be removed at any time for any breach of trust or for acting or proceeding in violation of, or for failing to act or proceed in accordance with, any provisions of this Agreement with respect to the duties and obligations of the Escrow Holder by any court of competent jurisdiction upon the application of the Issuer, the Borrower, or the holders of not less than five percentum ( 5%) in aggregate principal amount of the Defeased Bonds then outstanding. c) The Escrow Holder may not be removed until a successor Escrow Holder has been appointed in the manner set forth herein. SECTION 10. Successor Escrow Holder. a) If at any time hereafter the Escrow Holder shall resign, be removed, be dissolved or otherwise become incapable of acting, or shall be taken over by any governmental official, agency, department or board, the position of Escrow Holder shall thereupon become vacant. If the position of Escrow Holder shall become vacant for any of the foregoing reasons or for any other reason, the Issuer shall appoint an Escrow Holder to fill such vacancy. The Issuer shall mail a notice of any such appointment made by it to the Holders of the Defeased Bonds within thirty (30) days after such appointment. b) At any time within one year after such vacancy shall have occurred, the holders of a majority in principal amount of the Defeased Bonds then outstanding, by an instrument or concurrent instruments in writing, executed by such bondholders and filed with the governing body of the Issuer, may appoint a successor Escrow Holder, which shall supersede any Escrow Holder theretofore appointed by the Issuer. Photographic copies of each such instrument shall 5 be delivered promptly by the Issuer, to the predecessor Escrow Holder and to the Escrow Holder so appointed by the bondholders. c) If no appointment of a successor Escrow Holder shall be made pursuant to the foregoing provisions of this Section, the holder of any Defeased Bonds then outstanding, the Borrower, or any retiring Escrow Holder may apply to any court of competent jurisdiction to appoint a successor Escrow Holder. Such court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Escrow Holder. SECTION 11. Payment to Escrow Holder. The Escrow Holder hereby acknowledges that it has agreed to accept compensation under the Agreement in the sum of $500, which the Borrower agrees to pay on the date hereof for services to be performed by the Escrow Holder pursuant to this Agreement. Notwithstanding anything herein to the contrary, to the extent the Escrow Holder is removed for any reason hereunder, the Escrow Holder agrees to refund a pro rata amount of such fee to the Borrower based on the amount of time until termination of this Agreement divided by the original term of this Agreement. SECTION 12. Term. This Agreement shall commence upon its execution and delivery and shall terminate when the Defeased Bonds have been paid and discharged in accordance with the proceedings authorizing the Defeased Bonds. SECTION 13. Severability. If anyone or more of the covenants or agreements provided in this Agreement on the part of the Issuer or the Escrow Holder to be performed should be determined by a court of competent jurisdiction to be contrary to law, notice of such event shall be sent to Standard & Poor's, a division of McGraw- Hill Companies, Inc., but such covenant or agreements herein contained shall be null and void and shall in no way affect the validity of the remaining provisions of this Agreement. SECTION 14. Amendments to this A~reement. This Agreement is made for the benefit of the Issuer, the Borrower and the holders from time to time of the Defeased Bonds and it shall not be repealed, revoked, altered or amended in whole or in part without the written consent of all affected holders, the Escrow Holder, the Issuer and the Borrower; provided, however, that the Issuer, the Borrower and the Escrow Holder may, without the consent of, or notice to, such holders, enter into such agreements supplemental to this Agreement as shall not adversely affect the rights of such holders and as shall not be inconsistent with the terms and provisions of this Agreement, for anyone or more of the following purposes: a) to cure any ambiguity or formal defect or omission in this Agreement; b) to grant to, or confer upon, the Escrow Holder, for the benefit of the holders of the Defeased Bonds, any additional rights, remedies, powers or authority that may lawfully be granted to, or conferred upon, such holders or the Escrow Holder; and c) to subject to this Agreement additional funds, securities or properties. 6  The Escrow Holder shall, at its option, be entitled to rely exclusively upon an opinion of nationally recognized attorneys on the subject of municipal bonds acceptable to the Issuer with respect to compliance with this Section, including the extent, if any, to which any change, modification, addition or elimination affects the rights of the holders of the Defeased Bonds or that any instrument executed hereunder complies with the conditions and provisions of this Section. SECTION 15. Counterparts. This Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as one original and shall constitute and be but one and the same instrument. SECTION 16. Governin~ Law. This Agreement shall be construed under the laws of the State of Florida. Remainder of Page Intentionally Left Blank]