Okaloosa County BOCC — August 6, 2013 — Resolution for Airport Revenue Refunding Bonds, Series 2013 — reading text

selection shal! be determined by the County, (b) in the event that less than all Series 2013 Bonds of a maturity are to be redeemed, the Series 2013 Bonds of such maturity to be redeemed shall be selected by lot in such customary manner as the Trustee shall determine, and (c) in the event that less than all Series 2013 Bonds of a term bond are to be redeemed, the remaining annual amounts of mandatory sinking fund redemption shall be reduced in such years and amounts as the County shall determine. Upon the selection and call for redemption of, and the surrender of, any Series 2013 Bonds for redemption in part only, and except when registration of the Series 2013 Bonds is maintained pursuant to a book-entry only system, the County shall cause to be executed, authenticated and delivered to or upon the written order of the Holder thereof, at the expense of the County, new Series 2013 Bonds in fully registered form of authorized denominations and like tenor in an aggregate face amount equal to the unredeemed portion of the Series 2013 Bonds surrendered. Notice of Redemption. During the period that DTC or Cede & Co. is the registered owner of the Series 2013 Bonds, the Trustee shall not be responsible for mailing notices of redemption to the Beneficial Owners of the Series 2013 Bonds. See "DESCRIPTION OF THE SERIES 2013 BONDS -- Book-Entry Only System". Each notice of redemption of Series 2013 Bonds shall specify: (a) the date fixed for redemption, (b) the Principal Amount of Series 2013 Bonds or portions thereof to be redeemed, (c) the applicable redemption price, (d) the place or places of payment, (e) that payment of the Principal Amount and Redemption Premium, if any, will be made upon presentation and surrender to the Trustee or Paying Agent, as applicable, of the Series 2013 Bonds to be redeemed, (f) that interest accrued to the date fixed for redemption will be paid as specified in such notice, (g) that on and after said date interest on Series 2013 Bonds which have been redeemed will cease to accrue, and (h) the designation, including Series, and the CUSIP numbers of the Series 2013 Bonds to be redeemed and, if less than the face amount of any Series 2013 Bonds is to be redeemed, the Principal Amount to be redeemed. Any notice of redemption shall be sent by the Trustee not less than thirty (30) nor more than sixty (60) days prior to the date set for redemption by first class mail (a) to the registered owner of each of such Series 2013 Bonds to be redeemed in whole or in part at its address as it appears on the Register, (b) to all organizations registered with the Securities and Exchange Commission as securities depositories, and (c) to at least two information services of national recognition which disseminate redemption information with respect to tax-exempt securities. Failure to give any notice specified in (a) with respect to any particular Series 2013 Bond, or any defect therein, shall not affect the validity of any proceedings for the redemption of any other Series 2013 Bond with respect to which no such failure or defect has occurred, and failure to give any notice specified in (b) or (c), or any defect therein, shall not affect the validity of any proceedings for the redemption of any Series 2013 Bonds with respect to which the notice specified in (a) is correctly given. Notice of the optional redemption of the Series 2013 Bonds may be conditioned upon and made subject to the irrevocable deposit of sufficient funds to pay the redemption price after such notice is given and on or before the redemption date, provided such condition is expressly stated in the notice. SOURCES AND USES OF FUNDS The following table sets forth the sources and uses of funds from the proceeds of the Series 2013 Bonds: Sources of Funds Principal Amount of the Series 2013 Bonds $ Series 2003 Debt Service Reserve Fund Net Original Issue Discount Total $ Uses of Funds Deposit to Escrow Deposit Fund $ Deposit to 2013 Debt Service Reserve Fund Deposit to refund FAC Loan Costs of Issuance’? Total $ () Tncludes underwriter's discount, [bond insurance premium,] legal fees, rating agency fees, and other costs of issuance. DEBT SERVICE SCHEDULE The following table sets forth the scheduled annual debt service payments on the Series 2013 Bonds and the Outstanding Series 2007 Bonds, assuming no redemption prior to maturity, other than mandatory redemption through sinking fund installments for the Term Bonds. Interest payments are net of capitalized interest. Series 2013 Bonds Fiscal Year Ending Series Total Debt September 30 2007 Bonds Principal Interest Total Service 2014 $890,575 2015 892,875 2016 888,188 2017 887,563 2018 890,688 2019 892,250 2020 892,250 2021 887,500 2022 891,000 2023 892,050 2024 885,650 2025 892,150 2026 890,500 2027 891,050 2028 888,450 2029 892,700 2030 888,100 Total $15,133,538 $ $ $ $ SECURITY FOR THE SERIES 2013 BONDS Limited Obligations The principal amount of, redemption premium, if any and interest on the Series 2013 Bonds will be payable from, and secured by a lien upon and a pledge of, the "Trust Estate" created and defined in the Indenture. The Trust Estate consists of: (i) the Net Revenues; and (ii) the moneys and investments in certain Funds and Accounts pledged under the Indenture, including primarily the Revenue Fund and the Revenue Fund Coverage Account therein, the Series 2013 Principal, Interest and Redemption Accounts, respectively, in the Bond Fund, and the Series 2013 Debt Service Reserve Account in the Debt Service Reserve Fund. In addition, as described below, the Series 2013 Bonds are secured by the Pledged PFC Revenues on deposit in the Series 2013 Pledged PFC Account and Series 2013 PFC Coverage Subaccount in the Passenger Facility Charge Fund. THE SERIES 2013 BONDS AND THE INTEREST THEREON DO NOT CONSTITUTE A DEBT, LIABILITY OR OBLIGATION OF THE STATE, THE COUNTY OR ANY OTHER POLITICAL SUBDIVISION THEREOF (OTHER THAN A SPECIAL OBLIGATION OF THE COUNTY) AND NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE, THE COUNTY OR ANY OTHER POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE SERIES 2013 BONDS OR THE INTEREST THEREON. Net Revenues Under the Indenture, the County has irrevocably pledged the Net Revenues to the payment of the Series 2013 Bonds. As described above, such Net Revenues are also pledged to secure the Series 2007 Bonds and any Additional Bonds issued pursuant to the terms of the Indenture. Net Revenues are defined in the Indenture to mean Revenues less amounts needed to pay Operation and Maintenance Expenses (as hereinafter defined). Revenues are defined in the Indenture to mean all income and revenues received or accrued by the County in connection with the ownership, operation or use of, or otherwise related to the Airports System, including, but not limited to, (a) rentals, fees, and other charges for the use of or with respect to the Airports, (b) proceeds of business interruption insurance, and such other moneys designated as "Revenues" pursuant to the terms of a Supplemental Indenture; provided, however, that Revenues shall not include (A) interest income on, and any profit realized from, the investment of moneys in any Fund or Account to the extent that such income or profit is not transferred to, or retained in, the Revenue Fund, the Repair and Rehabilitation Fund, the Operation and Maintenance Fund or the Bond Fund; (B) interest income on, and any profit realized from, the investment of moneys in any fund or account funded from the proceeds of Special Facility Bonds; (C) amounts received by the County from, or in connection with, Special Facilities, unless such funds are treated as Revenues by the County; (D) grants-in-aid, donations, bequests and/or amounts received as reimbursements for previously expended money unless the County has lawfully elected that such grant, donation, bequest or reimbursement is to be treated as Revenues; (E) insurance proceeds which are not deemed to be Revenues in accordance with generally accepted accounting principles; (F) the proceeds of any condemnation awards; (G) the proceeds of any sale of land, buildings or equipment; (H) proceeds of a drawing under a Credit Facility; (I) passenger facility charge revenue; (J) Bond proceeds; (K) all revenue sources, such as, but not limited to, cargo facilities charges and CFCs imposed on rental car customers, unless such revenue sources are treated as Revenues by the County; and (L) any other amounts which are not deemed to be Revenues in accordance with generally accepted accounting principles or which are restricted as to their use. Operation and Maintenance Expenses are defined in the Indenture to mean all expenses of the County paid or accrued for the operation, maintenance, administration, and ordinary current repairs of the Airports, including certain payments to the Federal Government pursuant to the Eglin Agreements. Operation and Maintenance Expenses shall not include (a) the Principal Amount of, Redemption Premium, if any, or Interest on any Bonds; (b) any allowance for amortization or depreciation of the Airport Facilities; (c) any other expense for which (or to the extent to which) the County is or will be paid or reimbursed from or through any source that is 10 not included or includable as Revenues; (d) any extraordinary items arising from the early extinguishment of debt; or (e) any expense paid with amounts from the Repair and Rehabilitation Fund. Series 2007 Bonds; CFC Revenues The County has previously issued its Taxable Airport Revenue Bonds, Series 2007, which are secured by the Net Revenues on a parity with the Series 2013 Bonds. The Series 2007 Bonds are also secured by certain customer facility charges ("CFCs"), which do not secure the Series 2013 Bonds. The Series 2007 Bonds are not payable from the Pledged PFC Revenues. The County’s expectation is that the CFC revenues will pay for the debt service associated with the Series 2007 Bonds. See "NORTHWEST FLORIDA REGIONAL AIRPORT — Customer Facility Charges." Pledged PFC Revenues The Third Supplemental Indenture pledges the County's receipts from a Passenger Facility Charge ("PFC") to secure the Series 2013 Bonds. The County is currently collecting PFCs at the rate of $4.50 per passenger for each eligible flight segment flown (eligible flight segments are limited to the first two airports where PFCs are imposed for one-way tickets and the first two enplaning airports (outbound) and lease two enplaning airports (inbound) on round- trip tickets). The Pledged PFC Revenues are not pledged to secure the Series 2007 Bonds. The County's expectation with respect to the Series 2013 Bonds is that Pledged PFC Revenues will pay the majority of the debt service associated with the Series 2013 Bonds. See "FLOW OF FUNDS — Passenger Facility Charges" and "NORTHWEST FLORIDA REGIONAL AIRPORT — Passenger Facility Charges", herein. Rate Covenant Pursuant to the Indenture, the County covenants and agrees that it will take all lawful and available measures to fix and adjust from time to time the rentals, rates, fees and other charges for the use of the Airports calculated to be at least sufficient to produce (i) Net Revenues, plus (ii) Pledged PFC Revenues and Pledged CFC Revenues plus (iii) legally available amounts, if any, in the Revenue Fund Coverage Account, the PFC Coverage Subaccounts and the CFC Coverage Subaccounts (collectively, "Amounts Available to Pay Debt Service"), to provide for the greater of either: (A) (to the extent not otherwise paid from other legally available funds of the County) the amounts needed for making the required deposits in the Fiscal Year of the County to the Principal Accounts, the Interest Accounts, the Redemption Accounts, the Debt Service Reserve Fund, the Operation and Maintenance Reserve Account, the Repair and Rehabilitation Fund and the Subordinated Indebtedness Fund; or 11 (B) an amount not