Okaloosa County BOCC — April 1, 2014 — Loan Agreement.2BL — reading text

contract to exchange cash flows or payments or series of payments; (iv) any type of contract called, or designed to perform the function of, interest rate floors or caps, options, puts or calls, to hedge or minimize any type of financial risk, including, without limitation, payment, currency, rate or other financial risk; and (v) any other type of contract or arrangement that the Borrower determines is to be used, or is intended to be used, to manage or reduce the cost of Indebtedness, to convert any element of Indebtedness from one form to another, to maximize or increase investment return, to minimize investment return risk or to protect against any type of financial risk or uncertainty. "Derivative Indebtedness" means payments for which the Borrower shall have become obligated under a Derivative Agreement. "Derivative Period" means the period during which a Derivative Agreement is in effect. "Escrowed Interest" means amounts of interest on Indebtedness for which moneys or United States Government Obligations have been deposited in escrow, which deposit has been determined by an independent certified public accountant to be sufficient to pay such Escrowed Interest. "Escrowed Principal" means amounts of principal on Indebtedness for which moneys or United States Government Obligations have been deposited in escrow, which deposit has been determined by an independent certified public accountant to be sufficient to pay such Escrowed Principal. "Fiscal Year" means any 12-month period beginning on ________ 1 of any calendar year and ending on ________ 31 of such calendar year, or such other consecutive 12-month period selected by the Borrower as the fiscal year for the Borrower. "Funded Interest" means amounts irrevocably deposited in an escrow or other trust account to pay interest on Indebtedness and interest earned on amounts irrevocably deposited in an escrow or other trust account to the extent such interest earned is required to be applied to pay interest on such Indebtedness. "Indebtedness" means (i) all indebtedness of the Borrower for borrowed money, (ii) all installment sales, conditional sales and capital lease obligations incurred or assumed by the Borrower, and (iii) Derivative Indebtedness. "Maximum Annual Debt Service" means the highest Debt Service Requirement for any succeeding Fiscal Year. 2  "Required Information Recipient" means (i) the Bond Trustee, (ii) the initial holder of the Series 2014 Bonds, (iii) all nationally recognized municipal securities information repositories, (iv) any state information repository for the State identified by the Securities and Exchange Commission, and (v) all registered owners of $500,000 or more in principal amount of Bonds that request such reports in writing (which written request shall include a certification as to such ownership). "Subordinated Debt" means Indebtedness the payment of which is specifically subordinated to the payment of principal and interest on the Bonds or other Indebtedness incurred pursuant to the provisions of Sections 5.12(a), (b), (d), (f) or (g) hereof. All accounting terms not otherwise defined herein or in the Bond Indenture shall have the meanings assigned to them in accordance with generally accepted accounting principles in effect from time to time. All references in this instrument to designated "Articles," "Sections" and other subdivisions or subsections are to the designated Articles, Sections and other subdivisions of this instrument as originally executed. The words "herein," "hereof" and "hereunder" and other words of similar import refer to this Loan Agreement as a whole and not to any particular Article, Section or other subdivision unless the context indicates otherwise. ARTICLE II REPRESENTATIONS SECTION 2.1. REPRESENTATIONS BY ISSUER. The Issuer represents and warrants that: (a) it is a political subdivision organized and existing under the laws of the State, and will do or cause to be done all things within its power necessary to preserve its existence so long as any of the Bonds are Outstanding; (b) the Issuer has duly authorized the issuance, execution, delivery and performance of this Loan Agreement, the Bond Indenture and the other documents to which it is a party associated with the issuance of the Bonds, and has duly noticed and held the public hearing required by Section 147(f) of the Code and received sufficient private activity bond allocation required by the Code in connection with the issuance of the Series 2014A Bonds; (c) The Bonds are to be issued under and secured by the Bond Indenture pursuant to which the Issuer's interest in this Loan Agreement will be pledged and assigned to the Bond Trustee by outright assignment as security for payment of the principal of, premium, if any, and interest on the Bonds; (d) The Borrower has represented to the Issuer that the Project constitutes a "manufacturing facility" and a "project" within the meaning of the Act; (e) The Issuer has jurisdiction over the entire area in which the Project is to be located; (f) the Issuer has not pledged or assigned and will not pledge or assign its interest in this Loan Agreement, or any of the other documents associated with the issuance of the Bonds, 3 other than to secure the Bonds from time to time Outstanding as provided herein and in the Bond Indenture; and (g) each of the Issuer's representations, warranties and certifications contained in this Loan Agreement, the Tax Exemption Agreement and the Purchase Contract is true and correct in all material respects as of the date hereof. SECTION 2.2. REPRESENTATIONS AND WARRANTIES BY THE BORROWER. The Borrower makes the following representations and warranties as the basis for its covenants herein: (a) the Borrower is a non-profit corporation validly organized and existing under the laws of the State; (b) each of its representations, warranties and certifications contained in this Loan Agreement, the Tax Exemption Agreement and the Borrower's Closing Certificate is true and correct in all material respects as of the date hereof; (c) it reasonably expects to own all of the Project throughout the term of this Loan Agreement, it intends to use such facilities in connection with its operation of a water production, treatment and distribution system, and no Person other than the Borrower currently owns or will own or use any portion of the Project; (d) it is duly authorized under the laws of the State and all other applicable provisions of law and its articles of incorporation and by-laws to execute and deliver this Loan Agreement, the Tax Exemption Agreement and each of the other documents or instruments being delivered by the Borrower in connection with the issuance of the Bonds, that all action on its part necessary for the valid execution and delivery of this Loan Agreement, the Tax Exemption Agreement and each of the other documents or instruments to which the Borrower is a party related to the issuance of the Bonds (collectively the "Borrower's Documents") has been duly and effectively taken, and this Loan Agreement is a legal and valid obligation of the Borrower; (e) neither the execution and delivery of the Borrower's Documents, nor the consummation of the transactions contemplated hereby and thereby, nor the fulfillment of or compliance with the terms and conditions hereof or thereof conflicts with or results in a breach of the terms, conditions, or provisions of any agreement or instrument to which the Borrower is now a party or by which the Borrower is bound; (f) there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, known to be pending or threatened against or affecting the Borrower or any of its officers, nor to the best knowledge of the Borrower is there any basis therefor, wherein an unfavorable decision, ruling, or finding would materially adversely affect the transactions contemplated by the Borrower's Documents or which would adversely affect, in any way, the validity or enforceability of the Bonds, the Borrower's Documents, or any agreement or instrument to which the Borrower is a party, used or contemplated for use in the consummation of the transactions contemplated by the Borrower's Documents or the Bond Indenture; 4  (g) it has all material licenses and permits from all State, local and other governmental and regulatory agencies having jurisdiction required for the operation of its facilities; (h) The Tax Exemption Agreement executed and delivered by the Borrower concurrently with the issuance and delivery of the Series 2014 Bonds is true, accurate and complete in all material respects as of the date on which executed and delivered; (i) The Borrower agrees that neither it nor any related party to the Borrower (as defined in Treas. Reg. § 1.150-1(b)) will purchase any of the Series 2014A Bonds in an amount related to the obligation represented by this Loan Agreement, as described in Section 1.148-1(b) of the Code; (j) Any information that has been or will be supplied by the Borrower that has been or will be relied upon by the Issuer, the Bond Trustee and Bond Counsel with respect to the exclusion from gross income for federal income tax purposes of interest on the Series 2014A Bonds is true and correct; (k) The Project constitutes a "project," and a "manufacturing facility" within the meaning of the Act. All proceeds of the Bonds will be used to finance a "cost" within the meaning of the Act; (l) Based on current facts, estimates and circumstances, it is currently expected that the Project will not be sold or disposed of in a manner producing sale proceeds which, together with accumulated proceeds of the Series 2014 Bonds or earnings thereon, would be sufficient to enable the Borrower to retire substantially all of the Series 2014 Bonds prior to the maturity of the Series 2014 Bonds; (m) it has obtained all licenses and permits from all State, local and other governmental and regulatory agencies having jurisdiction required for the occupancy and operation of the Project which are currently obtainable, and the Borrower is not aware of any facts or circumstances which lead it to believe that all licenses and permits from all State, local and other governmental and regulatory agencies having jurisdiction required for the occupancy and operation of the Project which are not currently available will not be issued in due course; and (n) the Borrower has reviewed and is familiar with the terms and provisions of the Bond Indenture and will fully and faithfully perform all the duties and obligations which the Issuer has covenanted and agreed in the Bond Indenture to cause the Borrower to perform, and any duties and obligations which the Borrower is required in the Bond Indenture to perform. The foregoing shall not apply to any duty or undertaking of the Issuer which by its nature cannot be delegated or assigned. ARTICLE III ISSUANCE OF BONDS OF THE ISSUER SECTION 3.1. AGREEMENT TO ISSUE SERIES 2014 BONDS; PROCEEDS OF SERIES 2014 BONDS; ADDITIONAL BONDS. 5  (a) In order to provide funds to make the loan to the Borrower hereunder, the Issuer agrees to issue and sell the Series 2014 Bonds