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Home My WebLink AboutMBIA -1992 09 23 .r ~ a, 12xVt', b;+ C- '-., COMMI'lMENT TO ISSUE A FIN,u4CIAL GUARANTY INSURANCE . POLICY A1BIA Application No.: 92-06-5526 Sale Date: September, 1992 Program Type: Negotiated DP RE: $15,805,000 (Est) City of Winter Springs, Florida, Water and Sewer Refunding Revenue Bonds, Seies 1992 (the "Obligations") This commitment to issue a financial guaranty insurance policy (the "Commi tment" ) consti tutes an agreement between the CITY OF WINTER SPRINGS, FLORIDA (the "Applicant"), and MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION (the "Insurer"), a stock insurance company incorporated under the laws of the State of New York. Based on an approved application dated September 23, 1992, the Insurer agrees, upon satisfaction of the conditions herein, to issue on the earlier of (i) 120 days of said approval date or (ii) on the date of deli very of and payment for the Obligations, a financial guaranty insurance policy (the "Bond Insurance Policy"), for the Obligations, insuring the payment of principal of and interest on the Obligations when due. The issuance of the Bond Insurance Policy shall be subject to the following terms and conditions: 1. Payment by the Applicant, or by the Trustee on behalf of the Applicant, on the date of delivery of and payment for the Obligations, the following payments: a. a nonrefundable premium in the amount of .472'\. of total debt service less $46,000 credit, premium rounded to the nearest thousand. The premium set out in this paragraph shall be the total premium required to be paid on the Bond Insurance Policy issued pursuant to this Commitment; and b. Standard & Poor's Corporation rating agency fees in an amount to be billed directly by Standard & Poor's Corporation, based on the final par and other factors as determined by Standard & Poor's Corporation; and c. Moody's Investors Service rating agency fees in an amount to be billed directly by Moody's Investors Service, based on the final par and other factors as determined by Moody's Investors Service. 2. The Obligations shall have received the unqualified opinion of bond counsel with respect to the tax-exempt status of interest on the Obligations. 3. There shall have been no material adverse change in the Obligations or the Resolution, Bond Ordinance, Trust Indenture or other official document authorizing the issuance of the Obligations or in the final official statement or other similar document, including the financial statements included therein. 4. There shall have been no material submitted to the Insurer as a part of submitted to be a part of the application to adverse change in any information the application or subsequently the Insurer. "i_ .' "4 , -2- . MBIA 5. No event shall have occurred which would allow any underwriter or any other purchaser of the Obligations not to be required to purchase the Obligations at closing. 6. All documents executed in connection with the issuance of the Obligations shall contain a provision which requires copies of any amendments to such documents consented to by the Insurer to be sent to Standard & Poor's. 7. A Statement of Insurance satisfactory to the Insurer shall be printed on the obligations. 8. Prior to the delivery of and payment for the Obligations, none of the information or documents submitted as a part of the application to the Insurer shall be determined to contain any untrue or misleading statement of a material fact or fail to state a material fact required to be stated therein or necessary in order to make the statements contained therein not misleading. 9. No material adverse change affecting any security for the Obligations shall have occurred prior to the delivery of and payment for the Obligations. 10. This Commitment may be signed in counterpart by the parties hereto. 11. Receipt by Municipal Bond Investors Assurance Corporation of the final debt service schedule on the issue within three business days from the sale date. 12. Receipt, satisfactory review and subsequent oral approval by Municipal Bond Investors Assurance Corporation of draft copies of the CPA' s verification, escrow securities purchase contracts of SLG subscription forms and escrow agreement at least ten business days prior to closing. Final and signed copies of all the above documents to be sent via overnight mail from closing. 13. Receipt by Municipal Bond Investors Assurance Corporation at least five business days prior to closing of a draft opinion from Bond counsel (or Special Tax Counsel) to the effect that the refunding bonds are being issued in compliance with state law and that the interest on the refunding bonds is tax-exempt. 14. Receipt by Municipal Bond Investors Assurance Corporation at least five business days prior to closing of a draft opinion from Bond Counsel stating that the refunded bonds have been legally defeased. (This condition is only applicable in those situations where the refunding issue is legally defeasing the refunded issue.) Final executed copies of #13 and #14 to be sent via overnight mail. 15. If the escrow agreement allows for the substitution of securities in the escrow account, then it should be provided in the escrow agreement that no such substitution may occur unless there has first been delivered to the escrow agent/trustee, (1) a CPA verification that the escrow investments, as substituted, are sufficient to pay debt service, as it becomes due, on the refunded bonds and (2) an opinion of nationally recognized bond counsel to the effect that the substitution is permitted under the documents and the substitution has no adverse effect on the tax-exempt nature of the refunding bonds. ., .NIBIA 16. ~ -3- . Escrow investments must be limited to: A. Cash B. U. S. Treasury Certificates, Notes and Bonds (including State and Local Government Series -- "SLGS"). C. Direct obligations of the Treasury which have been stripped by the Treasury itself, CATS, TIGRS and similar securities. D. Resolution Funding Corp. (REFCORP) Only the interest component of REFCORP strips which have been stripped by request to the Federal Reserve Bank of New York in book entry form are acceptable. E. Pre-refunded municipal bonds rated "Aaa" by Moody's and "AAA" by S&P. If however, the issue is only rated by S&P (i.e., there is no Moody's rating), then the pre-refunded bonds must have been pre-refunded with cash, direct U.S. or U.S. guaranteed obligations, or AAA rated pre-refunded municipals to satisfy this condition. F. Obligations issued by the following agencies which are backed by the full faith and credit of the U.S.: a. U.S. Export-Import Bank (Eximbank) Direct obligations or fully guaranteed certificates of beneficial ownership b. Farmers Home Administration (FHA) Certificates of beneficial ownership c. Federal Financing Bank d. General Services Administration Participation certificates e. U.S. Maritime Administration Guaranteed Title XI financing f. U.S. Department of Housing and Urban Development (HUD) Project Notes Local Authority Bonds New Communi ties Debentures U. S. government guaranteed debentures U.S. Public Housing Notes and Bonds U.S. government guaranteed public housing notes and bonds 17. The Insurer's Legal Department review of the deal structure and consolidation of the systems. 18. By providing this commitment letter, which is contingent on a financing structure that contemplates combining the "East" and "West" Water and Sewer Systems, together with the City adopting a Resolution on September 28, 1992 providing for such, MBIA consents to the City that combining and consolidating the two systems is necessary to achieve certain operating efficiencies and compliance with its legal covenants. .. . A1BIA , -4- Dated this 23rd day of September, 1992. ""1;. . MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION By C7>~A A. ;;u].i Assistant Secretary CITY OF WINTER SPRINGS, FLORIDA By Title: