HomeMy WebLinkAbout2020 10 12 Consent 302 - Water & Sewer Revenue Refunding Note, Series 2020 • CONSENT AGENDA ITEM 302
,n m=ared CITY COMMISSION AGENDA I OCTOBER 12, 2020 REGULAR MEETING
1959
TITLE
Water & Sewer Revenue Refunding Note, Series 2020
SUMMARY
On September 4, 2020, the City prepared an RFP requesting proposals to combine
certain borrowings and reduce the interest rates associated with its outstanding debt
thereby reducing its overall debt service costs. The RFP called for the refunding of the
City's Water and Sewer Revenue Refunding Note, Series 2018 which matures on
October 1, 2030 and carries a fixed rate of interest of 2.75% and the City's outstanding
Water and Sewer Revenue State Revolving Loan, Series 2013 which matures on
October 1, 2032 and carries a fixed rate of interest of 2.77%.
The City received seven proposals. The proposal most favorable to the City was
submitted by Truist Bank(formerly BB&T/SunTrust). The amount of the funding is not
to exceed $3.2 million and will carry a fixed rate of interest of 1.72% to maturity of
October 1, 2032. The refunding date would take place on October 15, 2020 and
include the details found in the attached bank documents.
Upon acceptance of the refinancing of the Water and Sewer Refunding Revenue
Bonds, Series 2018 and the Water and Sewer Revenue State Revolving Loan, Series
2013 through Truist Bank, the City will realize a nominal savings of$217,506 (net) over
the remaining 12 years until final maturity of the bank note on 10/1/2032. This
equates to a savings for the City of$18,125 (nominal) annually.
RECOMMENDATION
Staff recommends the City Commission adopt Resolution 2020-27, accepting
the proposal of Truist Bank to issue a bank note to refund the City's Water
and Sewer Revenue Refunding Note, Series 2018, maturing on October 1,
2030, and the City's outstanding Water and Sewer Revenue State Revolving
Loan, Series 2013 not to exceed $3.2 million dollars, and authorize the City
Attorney and City Manager to prepare and execute any and all applicable
documents necessary to complete this refinancing.
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RESOLUTION NO. 2020-27
A RESOLUTION OF THE CITY OF WINTER SPRINGS,FLORIDA
ACCEPTING THE PROPOSAL OF TRUIST BANK TO PURCHASE
THE CITY'S NOT TO EXCEED $3.1 MILLION WATER AND
SEWER REVENUE REFUNDING NOTE, SERIES 2020 TO
CURRENTLY REFUND ALL OF THE CITY'S OUTSTANDING
WATER AND SEWER REVENUE REFUNDING NOTE, SERIES
2018 AND TO RETIRE THE CITY'S OBLIGATIONS UNDER
CLEAN WATER STATE REVOLVING FUND LOAN
AGREEMENT WW590600 AS AMENDED; AUTHORIZING THE
EXECUTION AND DELIVERY OF A LOAN AGREEMENT WITH
SAID BANK TO SECURE THE REPAYMENT OF SAID LOAN;
PROVIDING FOR THE PAYMENT OF SUCH 2020 NOTE FROM
THE NET REVENUES OF THE CITY'S WATER AND SEWER
SYSTEM ON PARITY WITH CERTAIN OUTSTANDING WATER
AND SEWER DEBT OF THE CITY, ALL AS PROVIDED IN THE
LOAN AGREEMENT; AUTHORIZING THE PROPER OFFICIALS
OF THE CITY TO DO ANY OTHER ADDITIONAL THINGS
DEEMED NECESSARY OR ADVISABLE IN CONNECTION WITH
THE EXECUTION OF THE LOAN AGREEMENT, THE 2020
NOTE, AND THE SECURITY THEREFOR; AUTHORIZING THE
EXECUTION AND DELIVERY OF OTHER DOCUMENTS IN
CONNECTION WITH SAID LOAN; DESIGNATING THE 2020
NOTE AS "BANK QUALIFIED;" PROVIDING FOR
SEVERABILITY; AND PROVIDING AN EFFECTIVE DATE.
BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER
SPRINGS, FLORIDA,AS FOLLOWS:
SECTION 1. AUTHORITY FOR THIS RESOLUTION. This Resolution is
adopted pursuant to the provisions of Chapter 166, Florida Statutes, the Florida Constitution, and
other applicable provisions of law.
SECTION 2. FINDINGS. It is hereby ascertained, determined and declared:
(A) The City of Winter Springs, Florida (the "City") deems it necessary,
desirable and in the best interests of the City that the City (i) refund all of its outstanding Water
and Sewer Revenue Refunding Note, Series 2018 and retire all of its obligations under Clean Water
State Revolving Fund Loan Agreement WW590600 as amended (collectively the "Refinancing")
and (ii) pay the costs related to issuance of the 2020 Note (as hereinafter defined), all as more
particularly described in the Loan Agreement(as defined herein).
(B) Pursuant to Section 2(b), Article VIII of the State Constitution, and Section
166.021,Florida Statutes, municipalities have the governmental, corporate and proprietary powers
to enable them to conduct municipal government, perform municipal functions, and render
municipal services, and may exercise any power for municipal purposes, except when expressly
prohibited by law. The issuance by the City of its Water and Sewer Revenue Refunding Note,
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Series 2020 (the "2020 Note") and the execution and delivery of the Loan Agreement for the
purposes of accomplishing the Refinancing is not prohibited by law.
(C) The 2020 Note will be issued as "Additional Parity Obligations" in
accordance with the provisions of City Resolution No. 665 as amended (the "Original
Instrument") and will be secured by the Net Revenues as provided in Section 6 hereof and the
Loan Agreement pursuant to which the City will issue the 2020 Note to secure the repayment of
the 2020 Note.
(D) In accordance with the provisions of the Original Instrument, it is hereby
found that all of the covenants contained in said resolution shall be fully applicable to the 2020
Note except as otherwise provided in the Loan Agreement.
(E) The City engaged PFM Financial Advisors LLC ("PFM"), the City's
financial advisor, to solicit proposals from qualified financial institutions to accomplish the
Refinancing. Based on such solicitation, City staff, in consultation with PFM, has recommended
the acceptance of the proposal from Truist Bank (the "Bank"). In furtherance of such
recommendation, PFM advises the City that it is in the best interest of the City to issue the 2020
Note pursuant to the Loan Agreement (the "Loan") by negotiated direct placement to the Bank,
allowing the City to have certainty on the price, interest rate and other terms for the 2020 Note
and, accordingly, the City Commission of the City hereby finds and determines that it is in the best
financial interest of the City that a negotiated placement of the 2020 Note to the Bank be
authorized.
SECTION 3. AUTHORIZATION OF REFINANCING. The City hereby
authorizes the Refinancing as more particularly described in the Loan Agreement.
SECTION 4. ACCEPTANCE OF BANK'S PROPOSAL. The City hereby
accepts the proposal of the Bank dated September 18, 2020 attached hereto to provide the City
with the Loan.
SECTION 5. APPROVAL OF FORM OF AND AUTHORIZATION OF LOAN
AGREEMENT AND EXECUTION OF LOAN AGREEMENT AND 2020 NOTE. The Loan and
the repayment of the Loan as evidenced by the 2020 Note shall be pursuant to the terms and
provisions of the Loan Agreement and the 2020 Note. The City hereby approves the Loan
Agreement by and between the City and the Bank in substantially the form attached hereto as
Exhibit A (the "Loan Agreement") and authorizes the Mayor or the Deputy
Mayor/Commissioner of the City (collectively, the "Mayor") and the City Clerk or any deputy or
assistant City Clerk of the City (collectively, the "City Clerk") to execute and deliver on behalf
of the City the Loan Agreement and the 2020 Note in substantially the form attached to the Loan
Agreement, with such changes, insertions and additions as they may approve, their execution
thereof being evidence of such approval.
SECTION 6. PAYMENT OF DEBT SERVICE ON 2020 NOTE. Pursuant to the
Loan Agreement, the 2020 Note will be secured by the Net Revenues of the City's Water and
Sewer System on parity with other debt of the City's Water and Sewer System, all as more
particularly described in the Loan Agreement.
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SECTION 7. AUTHORIZATION OF OTHER DOCUMENTS TO EFFECT
TRANSACTION. To the extent that other documents including but not limited to redemption
notices, certificates, opinions, or other items are needed to effect any of the transactions referenced
in this Resolution, the Loan Agreement or the 2020 Note and the security therefore, the Mayor,
the City Clerk, the City Manager, the Director of Finance/CFO, or any of their designees and the
City Attorney are hereby authorized to execute and deliver such documents, certificates, opinions,
or other items and to take such other actions as are necessary for the full, punctual, and complete
performance of the covenants, agreements,provisions, and other terms as are contained herein and
in the documents included herein by reference.
SECTION 8. PAYING AGENT AND REGISTRAR. The City hereby accepts
the duties to serve as registrar and paying agent for the 2020 Note.
SECTION 9. LIMITED OBLIGATION. The obligation of the City to repay
amounts under the Loan Agreement and the 2020 Note are limited and special obligations,payable
solely from the sources and in the manner set forth in the Original Instrument and the Loan
Agreement and shall not be deemed a pledge of the faith and credit or taxing power of the City.
SECTION 10. DESIGNATION OF 2020 NOTE AS BANK QUALIFIED. The
City designates the 2020 Note as a"qualified tax-exempt obligation"within the meaning of Section
265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"). The City does not
reasonably anticipate that the City, any subordinate entities of the City, and issuers of debt that
issue "on behalf" of the City, will during the calendar year 2020 issue more than $10,000,000 of
"tax-exempt" obligations, exclusive of those obligations described in Section 265(b)(3)(C)(ii) of
the Code.
SECTION 11. REPEAL OF INCONSISTENT RESOLUTIONS AND
ACTIONS. All resolutions or actions of the City in conflict herewith are hereby superseded and
repealed to the extent of such conflict.
SECTION 12. EFFECT OF PARTIAL INVALIDITY. If any one or more
provisions of this Resolution, the Loan Agreement or the 2020 Note shall for any reason be held
to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this
Resolution or the 2020 Note or the Loan Agreement, but this Resolution, the Loan Agreement and
the 2020 Note shall be construed and enforced as if such illegal or invalid provision had not been
contained therein. The 2020 Note and Loan Agreement shall be issued and this Resolution is
adopted with the intent that the laws of the State of Florida shall govern their construction.
SECTION 13. EFFECTIVE DATE. This Resolution shall take effect
immediately upon its adoption.
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PASSED,APPROVED AND ADOPTED this 12th day of October, 2020.
CITY OF WINTER SPRINGS, FLORIDA
[SEAL]
By:
Charles Lacey, Mayor
ATTEST:
By
Christian Gowan, City Clerk
Approved as to form:
By
Anthony A. Garganese, City Attorney
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EXHIBIT A
LOAN AGREEMENT
(See Attached)
A-1 Loan Agreement
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LOAN AGREEMENT
Dated October 15, 2020
By and Between
CITY OF WINTER SPRINGS, FLORIDA
(the "City")
and
TRUIST BANK
(the "Bank")
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TABLE OF CONTENTS
(The Table of Contents for this Loan Agreement is for convenience of reference only and
is not intended to define, limit or describe the scope or intent of any provisions of this Loan
Agreement.)
Page
ARTICLE I DEFINITION OF TERMS ......................................................................................... 1
Section1.01. Definitions................................................................................................... 1
Section1.02. Interpretation ............................................................................................... 3
Section 1.03. Titles and Headings..................................................................................... 3
ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE PARTIES......................... 4
Section 2.01. Representations and Warranties of City...................................................... 4
Section 2.02. Covenants of the City.................................................................................. 4
Section 2.03. Representations and Warranties of Bank .................................................... 4
ARTICLE III THE NOTE.............................................................................................................. 5
Section3.01. Purpose and Use .......................................................................................... 5
Section3.02. The Note...................................................................................................... 5
Section 3.03. Adjustments to Note Rate............................................................................ 6
Section 3.04. Conditions Precedent to Issuance of Note................................................... 6
Section 3.05. Registration of Transfer; Assignment of Rights of Bank............................ 7
Section 3.06. Ownership of the Note................................................................................. 8
Section 3.07. Authentication ............................................................................................. 8
ARTICLE IV COVENANTS OF THE CITY................................................................................ 9
Section 4.01. Performance of Covenants .......................................................................... 9
Section 4.02. Payment of Note.......................................................................................... 9
Section4.03. Tax Covenant............................................................................................... 9
Section 4.04. Application of Provisions of Original Instrument....................................... 9
Section 4.05. Compliance with Laws and Regulations................................................... 10
Section 4.06. No Impairment........................................................................................... 10
ARTICLE V EVENTS OF DEFAULT AND REMEDIES ......................................................... 10
Section 5.01. Events of Default; Remedies..................................................................... 10
ARTICLE VI MISCELLANEOUS PROVISIONS...................................................................... 10
Section 6.01. Covenants of City, Etc.; Successors.......................................................... 10
Section 6.02. Term of Agreement ................................................................................... 10
Section 6.03. Amendments and Supplements ................................................................. 10
Section6.04. Notices....................................................................................................... 10
Section 6.05. Benefits Exclusive..................................................................................... 11
Section6.06. Severability................................................................................................ 11
Section 6.07. Payments Due on Saturdays, Sundays and Holidays ................................ 11
Section6.08. Counterparts .............................................................................................. 12
Section 6.09. Applicable Law ......................................................................................... 12
Section 6.10. No Personal Liability................................................................................. 12
Section 6.11. Incorporation by Reference....................................................................... 12
Exhibit A Form of Note Including Purchaser's Certificate..................................................A-1
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LOAN AGREEMENT
THIS LOAN AGREEMENT (the "Agreement"), made and entered into this 15th day of
October, 2020, by and between CITY OF WINTER SPRINGS, FLORIDA (the "City"), a
municipal corporation of the State of Florida, and TRUIST BANK, a North Carolina banking
corporation, and its successors and assigns (the "Bank").
WITNESSETH:
WHEREAS, capitalized terms used in these recitals and not otherwise defined shall have
the meanings specified in Article I of this Agreement;
WHEREAS, the City, pursuant to the provisions of the Florida Constitution, Chapter 166,
Florida Statutes, City Resolution No. 665 adopted by the City Commission of the City on April
29, 1991, as amended and supplemented and other applicable provisions of law (all of the
foregoing, collectively,the "Act"), and Resolution No. 2020-27(the"Resolution"), adopted by the
City on October 12, 2020, is authorized to borrow money, and more particularly issue the Note
described below for the City's public purposes; and
WHEREAS, in response to a request for proposal regarding an intended borrowing to
refund all of the City's outstanding Water and Sewer Revenue Refunding Note, Series 2018 and
retire all of the City's obligations in regard to Clean Water State Revolving Loan Fund Agreement
WW590600 as amended (collectively, the "Refinancing"), the Bank submitted a proposal, dated
September 18, 2020, to the City (the "Proposal"); and
WHEREAS, pursuant to the Resolution the City has accepted the Proposal and the Bank
is willing to purchase the Note (as hereinafter defined), but only upon the terms and conditions of
this Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITION OF TERMS
Section 1.01. Definitions. Capitalized terms used in this Agreement shall have the
respective meanings assigned thereto by the Original Instrument (as hereinafter defined) and the
following terms not otherwise defined shall have the respective meanings as follows unless the
context clearly requires otherwise:
"Act" shall have the meaning assigned to that term in the recitals hereof.
"Bond Counsel" shall mean, Akerman LLP, or any other attorney at law or firm of
attorneys of nationally recognized standing in matters pertaining to the federal tax exemption of
interest on obligations issued by states and political subdivisions hired by the City to render an
opinion on such matters with regard to the Note.
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"Business Day" shall mean any day other than a Saturday, a Sunday, or a day on which the
office of the Holder at which payments on the Note are due or the offices of the City are lawfully
closed.
"City Clerk" shall mean the City Clerk or any deputy or assistant city clerk of the City and
such other person as may be duly authorized to act on his or her behalf.
"City Manager" shall mean the City Manager of the City and such other person as may be
duly authorized to act on his or her behalf.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and
the applicable rules and regulations promulgated thereunder.
"Debt Service" means principal and interest, and other debt-related costs, due in
connection with the Note, as applicable.
"Default Rate" shall mean the lesser of(a) 200 basis points over the Note Rate or(b)the
maximum rate permitted by law.
"Determination of Taxability" means a final decree or judgment of any Federal court or
a final action of the Internal Revenue Service determining that interest paid or payable on all or a
portion of the Note is or was includable in the gross income of the Noteholder for Federal income
tax purposes due to an act or a failure to act of the City; provided, that no such decree,judgment,
or action will be considered final for this purpose, however, unless the City has been given written
notice of such occurrence and, to the extent permitted by law, an opportunity to participate in and
seek, at the City's expense, a final administrative determination by the Internal Revenue Service
or determination by a court of competent jurisdiction (from which no further right of appeal exits)
as to occurrence of such Determination of Taxability. A Determination of Taxability does not
include and is not triggered by a change in law by the United States Congress that causes the
interest to be includable in the Bank's gross income.
"Event of Default" shall mean an Event of Default as defined in Section 5.01 of this
Agreement.
"Finance Director" shall mean the City's Director of Finance/CFO or such other person
as may be duly authorized to act on his or her behalf.
"Financial Advisor" shall mean PFM Financial Advisors LLC.
"Fiscal Year" shall mean the 12-month period commencing October 1 of each year and
ending on the succeeding September 30, or such other 12-month period as the City may designate
as its "fiscal year" as permitted by law.
"Loan" shall refer to an amount equal to the outstanding principal of the Note, together
with unpaid interest and penalties, if any, which have accrued.
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"Maturity Date" shall mean the date on which all principal and all unpaid interest accrued
on the Note shall be due and payable in full, which date shall be, if not sooner due to prepayment,
October 1, 2032.
"Note" shall mean the City of Winter Springs, Florida Water and Sewer Revenue
Refunding Note, Series 2020 issued by the City under the Agreement and the Resolution.
"Note Rate" shall mean the rate of interest to be borne by the Note which shall be a fixed
rate equal to 1.72% per annum calculated on the basis of a 360-day year of 12, 30-day months
subject to adjustment as provided herein.
"Noteholder" or "Holder" shall mean the Bank as the holder of the Note and any
subsequent registered holder of the Note.
"Original Instrument" shall mean Resolution No. 665 of the City adopted by the City
Commission on April 29, 1991, as amended.
"Parity Obligation" shall mean the City's outstanding Water and Sewer Refunding
Revenue Bonds, Series 2020 and outstanding Water and Sewer System Revenue Refunding Note,
Series 2016.
"Payment Date" shall mean each April 1 and October 1, commencing April 1, 2021 until
the Note has been paid in full.
"Pledged Revenues" means the Net Revenues as defined in the Original Instrument.
"Taxable Period" shall mean the period of time between (a) the date that interest on the
Note is deemed to be includable in the gross income of the owner thereof for federal income tax
purposes as a result of a Determination of Taxability, and (b) the date of the Determination of
Taxability and after which the Note bears interest at the Taxable Rate.
"Taxable Rate" shall mean,upon a Determination of Taxability a fixed rate equal to 2.18%
per annum.
Section 1.02. Interpretation. Unless the context clearly requires otherwise, words of
masculine gender shall be construed to include correlative words of the feminine and neuter
genders and vice versa, and words of the singular number shall be construed to include correlative
words of the plural number and vice versa. This Agreement and all the terms and provisions hereof
shall be construed to effectuate the purpose set forth herein and to sustain the validity hereof.
Section 1.03. Titles and Headings. The titles and headings of the Articles and Sections
of this Agreement, which have been inserted for convenience of reference only and are not to be
considered a part hereof, shall not in any way modify or restrict any of the terms and provisions
hereof, and shall not be considered or given any effect in construing this Agreement or any
provision hereof or in ascertaining intent, if any question of intent should arise.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
Section 2.01. Representations and Warranties of City. The City represents and
warrants to the Bank as follows:
(a) Existence. The City is a municipal corporation of the State of Florida, duly created
and validly existing under the laws of the State of Florida, with full power to enter into this
Agreement, to perform its obligations hereunder and to issue and deliver the Note to the Bank.
The making, execution and performance of this Agreement on the part of the City and the issuance
and delivery of the Note have been duly authorized by all necessary action on the part of the City
and will not violate or conflict with the Act, the Original Instrument or any agreement, indenture
or other instrument by which the City or any of its material properties is bound.
(b) Validity, Etc. This Agreement, the Note and the Resolution are valid and binding
obligations of the City enforceable against the City in accordance with their respective terms,
except to the extent that enforceability may be subject to valid bankruptcy, insolvency, financial
emergency, reorganization, moratorium or similar laws relating to or from time to time affecting
the enforcement of creditors' rights and except to the extent that the availability of certain remedies
may be precluded by general principles of equity.
(c) No Financial Material Adverse Change. No material adverse change in the
financial condition of the City or the Pledged Revenues has occurred since the audited financial
statements of the City for its year ended September 30, 2019.
(d) Powers of City. The City has the legal power and authority to pledge the Pledged
Revenues to the repayment of the Note on parity with the pledge to the Parity Obligation as
described herein.
(e) Authorizations, etc. No authorization, consent, approval, license, exemption of or
registration or filing with any court or governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, has been or will be necessary for the valid
execution, delivery and performance by the City of this Agreement, the Note and the related
documents, except such as have been obtained, given or accomplished.
Section 2.02. Covenants of the City. The City covenants as follows:
The City will furnish to the Bank(i) with 270 days following the end of each Fiscal Year,
a comprehensive annual financial report of the City for such Fiscal Year prepared in accordance
with generally accepted accounting standards, and an audit report of an independent CPA,prepared
in accordance with Chapter 10.550 of the Rules of the Florida Auditor General or the provisions
of any successor statutes or rule governing Florida local governmental entity audits. (ii)within 45
days of the commencement of Fiscal Year the current annual budget adopted by the City for such
Fiscal Year, and (iii) any other information which the Bank may reasonably request.
Section 2.03. Representations and Warranties of Bank. The Bank represents and
warrants to the City as follows:
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(a) Existence. The Bank is a North Carolina banking corporation with full power to
enter into this Agreement, to perform its obligations hereunder and to make the Loan. The
performance of this Agreement on the part of the Bank and the making of the Loan have been duly
authorized by all necessary action on the part of the Bank and will not violate or conflict with
applicable law or any material agreement, indenture or other instrument by which the Bank or any
of its material properties is bound.
(b) Validity. This Agreement is a valid and binding obligation of the Bank enforceable
against the Bank in accordance with its terms, except to the extent that enforceability may be
subject to valid bankruptcy, insolvency, financial emergency, reorganization, moratorium or
similar laws relating to or from time to time affecting the enforcement of creditors' rights (and
specifically creditors' rights as the same relate to banks) and except to the extent that the
availability of certain remedies may be precluded by general principles of equity.
ARTICLE III
THE NOTE
Section 3.01. Purpose and Use. On the date of this Agreement, the Bank shall make
available to the City the Loan in the principal amount of Million and Hundred and
Thousand Dollars ($ ). The proceeds available under this Agreement
shall be used solely to accomplish the Refinancing and to pay costs of issuing the Note.
Section 3.02. The Note. The Note shall be substantially in the form set forth as Exhibit A
to this Agreement. The general terms of the Note shall be as follows:
(a) Amount of Note. The aggregate principal amount of the Note shall be Million
Hundred and Thousand Dollars ($ ). The Note shall be issued in a
single denomination in an amount equal to the principal amount thereof.
(b) Interest. The Note shall bear interest at the Note Rate payable on each Payment
Date. The Note Rate shall be subject to adjustment as provided in the Note. The Notehol der shall
promptly notify the City in writing of any adjustments in the Note Rate. Notwithstanding any
provision hereof the contrary, in no event shall the interest rate on the Note exceed the maximum
rate permitted by law. Interest on the Note shall be computed on the basis of a 360-day year
comprised of 12, 30-day months.
(c) Prepayments and Principal Payments. The Note shall be subject to prepayment in
whole at the option of the City, as provided in the Note. Any prepayment shall be made on such
date as shall be specified by the City in a written notice delivered to the Noteholder not less than
ten (10) days prior to the specified prepayment date. If at the time of mailing of notice of an
optional redemption,the City shall not have deposited moneys sufficient to redeem the Note called
for redemption such notice shall state that the redemption is conditional and is subj ect to the deposit
of the redemption moneys not later than the redemption date and such notice shall be of no effect
unless such moneys are so deposited. Any prepayment shall be applied first to accrued interest,
then to other amounts owed the Holder, and finally to principal. Notwithstanding anything herein,
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or in the Note to the contrary, the Bank shall not be required to surrender the Note or mark it
canceled until it has been paid in full all amounts due hereunder and under the Note.
Principal on the Note is payable on each Payment Date as set forth in the Note.
Section 3.03. Adjustments to Note Rate. The Note Rate shall be subject to adjustment
as hereinafter described and as provided in the Note.
If there is a Determination of Taxability the Note shall bear interest from the effective date
of such Determination of Taxability at a rate per annum, equal to the Taxable Rate.
If it should ever be determined that this Note is not a "qualified tax-exempt obligation"
(QTEO) for purposes of Section 265 of the Code, then the City shall pay to the Owner, within
sixty days after demand, such amounts as shall provide to the Owner the same rate of return on the
Note that the Owner would have realized had the Note been a QTEO retroactive to the date of such
determination. This adjustment shall survive payment of the Note until such time as the federal
statute of limitations under which the Note could be declared not to be a QTEO shall have expired.
Notwithstanding any provision hereto the contrary,in no event shall the interest rate on the
Note exceed the maximum rate permitted by law.
Section 3.04. Conditions Precedent to Issuance of Note. Prior to or simultaneously
with the delivery of the Note, there shall be filed with the Bank the following, each in form and
substance reasonably acceptable to the Bank:
(a) an opinion of legal counsel to the City substantially to the effect that (i) the
Resolution and Original Instrument have been duly adopted and this Agreement and the Note have
been duly authorized, executed and delivered by the City and each constitutes a valid,binding and
enforceable agreement of the City in accordance with its respective terms, except to the extent that
the enforceability of the rights and remedies set forth therein and herein may be limited by
bankruptcy, insolvency, financial emergency or other laws affecting creditors' rights generally or
by usual equity principles; (ii) the City's execution, delivery and performance of this Agreement
and the Note are not subject to any authorization, consent, approval or review of any governmental
body, public officer or regulatory authority not heretofore obtained or effected; (iii)the execution,
issuance and delivery of the Note has been duly and validly authorized by the City, and the Note
constitutes a valid and binding special obligation of the City enforceable in accordance with its
terms; (iv) the City (A) is a municipal corporation duly organized and validly existing under the
laws of the State of Florida, and (B) has power and authority to adopt the Original Instrument and
the Resolution, to execute and deliver this Agreement to execute and deliver the Note, and to
consummate the transactions contemplated by such instruments; (v) the execution, delivery and
performance of the Note and this Agreement and compliance with the terms thereof and hereof,
under the circumstances contemplated hereby, do not and will not in any material respect conflict
with, or constitute on the part of the City a breach or default under, any indenture, mortgage, deed
of trust, agreement or other instrument to which the City or to which its properties are subject or
conflict with, violate or result in a breach of any existing law, administrative rule or regulation,
judgment, court order or consent decree to which the City or its properties are subject; (vi) to the
best of such counsel's knowledge,there is no claim, action, suit,proceeding,inquiry,investigation,
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litigation or other proceeding, at law or in equity, pending or threatened in any court or other
tribunal, state or federal (W)restraining or enjoining, or seeking to restrain or enjoin, the issuance,
sale, execution or delivery of the Note, (X) in any way questioning or affecting the validity or
enforceability of any provision of this Agreement, the Note, the Original Instrument or the
Resolution, (Y) in any way questioning or affecting the validity of any of the proceedings or
authority for the authorization, sale, execution or delivery of the Note, or of any provision made
or authorized for the payment thereof, or(Z)questioning or affecting the organization or existence
of the City or the right of any of its officers to their respective offices or the ability of the City to
operate the System (as described the Original Instrument); (vii)the City has the legal authority to
accomplish the Refinancing, to collect and to grant a lien on the Pledged Revenues as described
herein and in the Resolution; and (viii) all conditions contained in the ordinances and resolutions
of the City precedent to the issuance of the Note have been complied with;
(b) an opinion of Bond Counsel (who may rely on opinion of legal counsel to the City
as to legal matters not covered by such Counsel's opinion), substantially to the effect that such
counsel is of the opinion that: (i)this Loan Agreement constitutes a valid and binding obligation
of the City enforceable upon the City in accordance with its terms; (ii) the Note is a valid and
binding special obligation of the City enforceable in accordance with its terms,payable solely from
the sources provided therefor in this Loan Agreement; (iii) assuming compliance by the City with
certain covenants relating to requirements contained in the Code interest on the Note is excluded
from gross income for purposes of federal income taxation; (iv) based on representations of the
City included in the closing transcript for the Note,the Note is a "qualified tax-exempt obligation"
within the meaning of Section 265 of the Code and; (v) the Note is exempt from all taxation
imposed by the State of Florida other than estate taxes and taxes imposed by Chapter 220 Florida
Statutes on interest, income or profits on debt obligations owned by corporations.
(c) a copy of a completed and executed Form 8038-G to be filed with the Internal
Revenue Service by the City;
(d) the original executed Note and Agreement;
(e) the certificate regarding the issuance of Additional Parity Obligation required by
Section 19N of the Original Instrument; and
(f) such other documents as the Bank reasonably may request.
When the documents and items mentioned in clauses (a) through (f), inclusive, of this
Section shall have been filed with the Bank, and when the Note shall have been executed as
required by this Agreement, the City shall deliver the Note to or upon the order of the Bank upon
receipt of the purchase price therefor.
Section 3.05. Registration of Transfer; Assignment of Rights of Bank, Mutilated,
Lost, Stolen or Destroyed Note. The City shall keep at the office of the City Clerk in the City's
records the registration of the Note and the registration of transfers of the Note as provided in this
Agreement. The transfer of the Note may be registered only upon the books kept for the
registration of the Note and registration of transfer thereof upon surrender thereof to the City
together with an assignment duly executed by the Noteholder or its attorney or legal representative
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in the form of the assignment set forth on the form of the Note attached as Exhibit A to this
Agreement; provided, however, that the Note may be transferred only in whole and not in part. In
the case of any such registration of transfer, the City shall execute and deliver in exchange for the
Note a new Note registered in the name of the transferee. In all cases in which the Note shall be
transferred hereunder, the City shall execute and deliver at the earliest practicable time a new Note
in accordance with the provisions of this Agreement. The City may make a charge for every such
registration of transfer of a Note sufficient to reimburse it for any tax or other governmental
charges (other than those of the City) required to be paid with respect to such registration of
transfer, but no other charge shall be made for registering the transfer hereinabove granted. The
Note shall be issued in fully registered form and shall be payable in any lawful coin or currency
of the United States. Nothing in this Section 3.05 shall be interpreted to prohibit the Holder of the
Note from selling participations in the Note to any investors meeting the conditions of this Section
3.05.
The registration of transfer of the Note on the registration books of the City shall be deemed
to effect a transfer of the rights and obligations of the transferor under this Agreement to the
transferee. Thereafter, such transferee shall be deemed to be the Bank under this Agreement and
shall be bound by all provisions of this Agreement that are binding upon the Bank. The City and
the transferor shall execute and record such instruments and take such other actions as the City
and such transferee may reasonably request in order to confirm that such transferee has succeeded
to the capacity of Bank under this Agreement and the Note.
The Holder of the Note is hereby granted power to transfer absolute title thereof by
assignment thereof to a bona fide purchaser for value (present or antecedent) without notice of
prior defenses or equities or claims of ownership enforceable against such owner's assignor or any
person in the chain of title and before the maturity of the Note; provided, however, that no transfer
shall be permitted absent the City's receipt of a certificate in form and substance similar to the one
included as part of Exhibit A hereto from such proposed transferee. Every prior Holder of the
Note shall be deemed to have waived and renounced all of such owner's equities or rights therein
in favor of every such bona fide purchaser, and every such bona fide purchaser shall acquire
absolute title thereto and to all rights represented thereby.
In the event any Note is mutilated, lost, stolen, or destroyed, the City shall execute a new
Note of like date and denomination as that mutilated, lost, stolen or destroyed, provided that, in
the case of any mutilated Note, such mutilated Note shall first be surrendered to the City, and in
the case of any lost, stolen, or destroyed Note, there first shall be furnished to the City evidence of
such loss, theft or destruction together with an indemnity satisfactory to it.
Section 3.06. Ownership of the Note. The person in whose name the Note is registered
shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or on
account of the Note shall be made only to the Holder thereof or such owner's legal representative.
All such payments shall be valid and effectual to satisfy and discharge the liability upon the Note,
and interest thereon, to the extent of the sum or sums so paid.
Section 3.07. Authentication. Until the Note shall have endorsed thereon a certificate of
authentication substantially in the form set forth in Exhibit A, duly executed by the manual
signature of the registrar as authenticating agent, it shall not be entitled to any benefit or security
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under this Agreement. The Note shall not be valid or obligatory for any purpose unless and until
such certificate of authentication shall have been duly executed by the registrar, and such
certificate of the registrar upon the Note shall be conclusive evidence that such Note has been duly
authenticated and delivered under this Agreement.
ARTICLE IV
COVENANTS OF THE CITY
Section 4.01. Performance of Covenants. The City covenants that it will perform
faithfully at all times its covenants, undertakings and agreements contained in this Agreement and
the Note or in any proceedings of the City relating to the Loan.
Section 4.02. Payment of Note.
(a) The City does hereby irrevocably pledges the Pledged Revenues (except as
otherwise provided in this Agreement)on parity with the pledge to the Parity Obligation as security
for the repayment of the Note.
(b) The Note will be a special obligation of the City secured solely by the Pledged
Revenues and is payable from the Pledged Revenues as provided in this Agreement. The Note
will not constitute a general debt, liability or obligation of the City or the State of Florida or any
political subdivision thereof within the meaning of any constitutional or statutory limitation.
Neither the faith and credit nor the taxing power of the City or of the State of Florida or any
political subdivision thereof is pledged to the payment of the principal of or interest on the Note
and the Noteholder shall never have the right to compel any exercise of any ad valorem taxing
power of the City or of the State of Florida or any political subdivision thereof, directly or
indirectly to enforce such payment. The Note shall not constitute a lien upon any property of the
City except upon the Pledged Revenues.
Section 4.03. Tax Covenant. The City covenants to the Noteholder that the City will not
make any use of the proceeds of the Note at any time during the term of such Note which, if such
use had been reasonably expected on the date the Note was issued, would have caused such Note
to be an "arbitrage bond" within the meaning of the Code. The City will do all acts including
complying with all requirements of the Code and any valid and applicable rules and regulations
promulgated thereunder necessary to insure the exclusion of interest on the Note from the gross
income of the Holders thereof for purposes of federal income taxation.
Section 4.04. Application of Provisions of Original Instrument. The Note shall for all
purposes be considered to be Additional Parity Obligation issued under the authority of Section
19N of the Original Instrument and shall be entitled to all the protection and security provided in
and by the Original Instrument for Additional Parity Obligation, and the Note shall be in all
respects entitled to the same security,rights and privileges enjoyed by the Parity Obligation except
as otherwise provided herein. The debt service on the Note shall be payable on a parity with the
other Additional Parity Obligation issued pursuant to the Original Instrument provided however,
the Note shall have no lien or otherwise be entitled to payments from any amounts on deposit in
the Reserve Account or any subaccount therein.
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Section 4.05. Compliance with Laws and Regulations. The City shall maintain
compliance with all federal, state and local laws and regulations applicable to accomplishing_the
Refinancing and the Loan.
Section 4.06. No Impairment. As long as the Note is outstanding, the pledging of the
Pledged Revenues in the manner provided herein shall not be subject to repeal, modification or
impairment by any subsequent ordinance, resolution or other proceedings of the City Council.
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
Section 5.01. Events of Default; Remedies. The provisions of Section 21 of the Original
Instrument shall apply for purposes of this Loan Agreement and shall be applied to the Note as
though fully restated herein. In addition to the Events of Default set forth in Section 21 of the
Original Instrument an Event of Default with respect to the Note shall also include a default by the
City in the performance of or compliance with any term or covenant contained herein, which
default or noncompliance shall continue and not be cured within sixty (60) days after (i) notice
thereof to the City by the Bank; or(ii)the Bank is notified of such noncompliance or should have
been so notified,whichever is earlier. Upon the occurrence and continuance of an Event of Default
for five (5) days, the Note shall bear interest at the Default Rate until such Event of Default is
cured or the Note is no longer Outstanding.
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01. Covenants of City, Etc.; Successors. All of the covenants, stipulations,
obligations and agreements contained in this Agreement shall be deemed to be covenants,
stipulations, obligations and agreements of the City to the full extent authorized or permitted by
law, and all such covenants, stipulations, obligations and agreements shall be binding upon the
successor or successors thereof from time to time, and upon any officer, board, commission,
authority, agency or instrumentality to whom or to which any power or duty affecting such
covenants, stipulations, obligations and agreements shall be transferred by or in accordance with
law.
Section 6.02. Term of Agreement. This Agreement shall be in full force and effect from
the date hereof until the Note and all other sums payable to the Holder hereunder have been paid
in full.
Section 6.03. Amendments and Supplements. This Agreement may be amended or
supplemented from time to time only by a writing duly executed by each of the City and the
Noteholders. The City shall not without the written consent of the Owner adopt any resolution
amending or supplementing the Original Instrument except as provided in Section 22 of the
Original Instrument.
Section 6.04. Notices. Any notice, demand, direction, request or other instrument
authorized or required by this Agreement to be given to or filed with the City or the Bank, shall be
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deemed to have been sufficiently given or filed for all purposes of this Agreement if and when
sent by certified mail, return receipt requested:
(a) As to the City:
City of Winter Springs, Florida
City Hall
1126 East State Road 434
Winter Springs, Florida 32708
Attention: Director of Finance/CFO
(b) As to the Bank:
Truist Bank
5130 Parkway Plaza Blvd.
Charlotte, N.C. 28217
Attention: Governmental Finance
or at such other address as shall be furnished in writing by any such party to the other, and shall
be deemed to have been given as of the date so delivered or deposited in the United States mail.
Either party may, by notice sent to the other, designate a different or additional address to which
notices under this Agreement are to be sent.
Section 6.05. Benefits Exclusive. Except as herein otherwise provided, nothing in this
Agreement, expressed or implied,is intended or shall be construed to confer upon any person,firm
or corporation, other than the City and the Noteholder, any right, remedy or claim, legal or
equitable,under or by reason of this Agreement or any provision hereof, this Agreement and all of
its provisions being intended to be and being for the sole and exclusive benefit of the City and the
Noteholder.
Section 6.06. Severability. In case any one or more of the provisions of this Agreement,
any amendment or supplement hereto or of the Note shall for any reason be held to be illegal or
invalid, such illegality or invalidity shall not affect any other provision of this Agreement, any
amendment or supplement hereto or the Note, but this Agreement, any amendment or supplement
hereto and the Note shall be construed and enforced at the time as if such illegal or invalid
provisions had not been contained therein, nor shall such illegality or invalidity or any application
thereof affect any legal and valid application thereof from time to time. In case any covenant,
stipulation, obligation or agreement contained in the Note or in this Agreement shall for any reason
be held to be in violation of law, then such covenant, stipulation, obligation, or agreement shall be
deemed to be the covenant, stipulation, obligation or agreement of the City to the full extent from
time to time permitted by law.
Section 6.07. Payments Due on Saturdays, Sundays and Holidays. In any case where
the date of maturity of interest on or principal of the Note or the date fixed for prepayment of the
Note shall be other than a Business Day, then payment of such interest or principal may be made
on the next succeeding Business Day with the same force and effect as if paid on the date of
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maturity or the date fixed for prepayment, and no interest on any such principal amount shall
accrue for the period after such date of maturity or such date fixed for prepayment.
Section 6.08. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered, shall be an original; but such
counterparts shall together constitute but one and the same Agreement, and, in making proof of
this Agreement,it shall not be necessary to produce or account for more than one such counterpart.
Section 6.09. Applicable Law. This Agreement shall be governed exclusively by and
construed in accordance with the applicable laws of the State of Florida.
Section 6.10. No Personal Liability. Notwithstanding anything to the contrary contained
herein or in the Note, or in any other instrument or document executed by or on behalf of the City
in connection herewith, no stipulation, covenant, agreement or obligation of any present or future
member of the City Commission, officer, employee or agent of the City, officer, employee or agent
of a successor to the City, in any such person's individual capacity, shall cause such person to be
liable personally for any breach or non-observance of or for any failure to perform, fulfill or
comply with any such stipulations, covenants, agreements or obligations, nor shall any recourse
be had for the payment of the principal of or interest on the Note or for any claim based thereon
or on any such stipulation, covenant, agreement or obligation, against any such person, in his or
her individual capacity, either directly or through the City or any successor to the City, under any
rule or law or equity, statute or constitution or by the enforcement of any assessment or penalty or
otherwise and all such liability of any such person, in his or her individual capacity, is hereby
expressly waived and released.
Section 6.11. Incorporation by Reference. All of the terms and obligations of the
Resolution are hereby incorporated herein by reference as if all of the foregoing were fully set
forth in this Agreement. All recitals appearing at the beginning of this Agreement are hereby
incorporated herein by reference.
Section 6.12. Waiver of Jury Trial. THE CITY AND THE BANK HEREBY
KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVE, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT EITHER OF
THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION,WHETHER
IN CONTRACT OR TORT, AT LAW OR IN EQUITY, BASED HEREON OR ARISING OUT
OF, UNDER OR IN CONNECTION WITH THE NOTE AND ANY OTHER BANK
DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
WITH THE NOTE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY
HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE BANK ENTERING
INTO OR ACCEPTING THE NOTE. FURTHER, THE CITY HEREBY CERTIFIES THAT NO
REPRESENTATIVE OR AGENT OF THE BANK, NOR THE BANK'S COUNSEL, HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK WOULD NOT, IN THE
EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY
TRIAL PROVISION.
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Section 6.13. No Advisory or Fiduciary Relationship. In connection with all aspects of
each transaction contemplated hereunder(including in connection with any amendment,waiver or
other modification hereof or of any other documents related hereto), the City acknowledges and
agrees, that: (a) (i) it has consulted its own legal, accounting, regulatory and tax advisors to the
extent it has deemed appropriate, (ii)it is capable of evaluating, and understands and accepts, the
terms,risks and conditions of the transactions contemplated hereby and any other loan documents,
(iii)the Bank is not acting as a municipal advisor or financial advisor to the City and(iv)the Bank
has no fiduciary duty pursuant to Section 15B of the Securities Exchange Act to the City with
respect to the transactions contemplated hereby and the discussions, undertakings and procedures
leading thereto (irrespective of whether the Bank has provided other services or is currently
providing other services to the City on other matters); (b) (i)the Bank is and has been acting solely
as a principal in an arm's length commercial lending transaction and has not been, is not, and will
not be acting as an advisor, agent or fiduciary, for the City, or any other person and (ii) the Bank
has no obligation to the City, with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other documents delivered in connection with the
delivery of the Note; (c) notwithstanding anything herein to the contrary, it is the intention of the
City and the Bank that the loan documents represent a commercial loan transaction not involving
the issuance and sale of a municipal security, and that any bond, note or other debt instrument that
may be delivered to the Bank is delivered solely to evidence the repayment obligations of the City
under the loan document; and (d) the Bank may be engaged in a broad range of transactions that
involve interests that differ from those of the City, and the Bank has no obligation to disclose any
of such interests to the City. To the fullest extent permitted by law, the City hereby waives and
releases any claims that it may have against the Bank with respect to any breach or alleged breach
of agency or fiduciary duty in connection with any aspect of any transactions contemplated
hereby. If the City would like a municipal advisor in this transaction that has legal fiduciary duties
to the City,the City is free to engage a municipal advisor to serve in that capacity. The transactions
contemplated herein and the Note are delivered, pursuant to and in reliance upon the bank
exemption and/or the institutional buyer exemption provided under the municipal advisor rules of
the Securities and Exchange Commission, Rule 1513al-1 et seq, to the extent that such rules apply
to the transactions contemplated hereunder.
Section 6.14. Patriot Act Notice. The Bank hereby notifies the City that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 signed into law October 26,
2001), the Bank may be required to obtain, verify and record information that identifies the City,
which information includes the name and address of the City and other information that will allow
the Bank to identify the City in accordance with the Act.
Section 6.15. Documentary and Intangible Taxes. In the event that any intangible tax
or documentary stamp tax is due from the Holder to any state or other governmental agency or
authority because of the execution or holding of the Note, the City shall, upon demand, reimburse
the Holder for any such tax paid.
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[Signature Page for LOANAGREEMENT
dated as of October 15, 2020 between
the City of Winter Springs, FL and Truist Bank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first set forth herein.
CITY OF WINTER SPRINGS, FLORIDA
By:
ATTEST: Charles Lacey, Mayor
Christian Gowan, City Clerk
Approved as to form:
Anthony Garganese, City Attorney
TRUIST BANK
By:
Andrew G. Smith, Senior Vice President
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EXHIBIT A
FORM OF NOTE
PRIOR TO BECOMING A HOLDER, A PROPOSED PURCHASER SHALL EXECUTE
A PURCHASER'S CERTIFICATE IN THE FORM ATTACHED HERETO CERTIFYING,
AMONG OTHER THINGS, THAT SUCH HOLDER IS AN "ACCREDITED INVESTOR" AS
SUCH TERM IS DEFINED IN THE SECURITIES ACT OF 1933, AS AMENDED, AND
REGULATION D THEREUNDER.
CITY OF WINTER SPRINGS, FLORIDA
WATER AND SEWER REVENUE REFUNDING NOTE,
SERIES 2020
Principal Sum Maturity Date Note Rate Date of Issuance
$ October 1, 2032 1.72% October 15, 2020
The CITY OF WINTER SPRINGS, FLORIDA (the "City"), for value received, hereby
promises to pay solely from the sources described in the within mentioned Agreement, to the order
of TRUIST BANK, a national banking association, or its assigns (the "Holder"), at
, or at such place as the Holder may from time to time designate in writing, the
Principal Sum, such principal to be repaid in installments due on the dates and in the amounts set
forth on Schedule "I " hereto, with all unpaid principal and interest due in full on the above
referenced Maturity Date, and to pay interest on the outstanding principal amount hereof from the
most recent date to which interest has been paid or provided for, or if no interest has been paid,
from the Date of Issuance shown above, on April 1 and October 1 of each year(each, an "Interest
Payment Date"), commencing on April 1, 2021,until payment of said principal sum has been made
or provided for, at the above referenced Note Rate calculated on the basis of a 360-day year of
twelve 30-day months. Payments due hereunder shall be payable in any coin or currency of the
United States of America which, at the time of payment, is legal tender for the payment of public
and private debts, which payments shall be made to the Holder hereof by check mailed to the
Holder at the address designated in writing by the Holder for purposes of payment or by bank wire
or bank transfer as such Holder may specify in writing to the City or otherwise as the City and the
Holder may agree.
The Note Rate may be adjusted in accordance with Section 3.03 of that certain Loan
Agreement by and between the Holder and the City, dated October 15, 2020 (the "Agreement").
Such adjustments may be retroactive.
All capitalized terms not otherwise defined herein shall have the meanings ascribed to such
terms in the Agreement.
The Note may be prepaid by the City in whole on any date after October 1, 2026 from any
legally available monies at a prepayment price of 100% of the principal amount to be redeemed,
plus accrued interest to the prepayment date. Prepayment shall be made on such date as shall be
specified by the City in a written notice delivered to the Holder not less than ten(10) days prior to
Exhibit A-1
54828878;2
46
the specified prepayment date as provided in Section 3.02(c) of the Agreement. Any prepayments
shall be applied as provided in Section 3.02(c) of the Agreement.
Notice having been given as aforesaid, the principal amount to be prepaid shall become
due and payable on the prepayment date stated in such notice, together with interest accrued and
unpaid to the prepayment date on such principal amount. If, on the prepayment date, funds for the
payment of such principal amount, together with interest to the prepayment date on such principal
amount, shall have been given to the Holder, as above provided, then from and after the
prepayment date interest on such principal amount of this Note shall cease to accrue.
This Note is authorized to be issued in the outstanding aggregate principal amount equal
to the Principal Sum under the authority of and in full compliance with the Constitution and statutes
of the State of Florida, including, particularly, Chapter 166, Florida Statutes and other applicable
provisions of law, City Resolution No. 665 as amended and supplemented (the "Original
Instrument") and the City's Resolution No. 2020-27_ adopted by the City Commission on
October 12, 2020 (the "Resolution"), and is subject to all terms and conditions of the Agreement
and the Resolution. The Note is being issued as an Additional Parity Obligation under the
provisions of the Original Instrument. Any term used in this Note and not otherwise defined shall
have the meaning ascribed to such term in the Resolution or the Agreement, as the case may be.
This Note is a limited, special obligation of the City, payable from and secured solely by a
lien upon and pledge of the Pledged Revenues, as defined and described and in the manner
provided in the Agreement. The lien of this Note on the Pledged Revenues is on parity with the
lien thereon of the Parity Obligation except as otherwise provided in the Agreement.
Notwithstanding any provision in this Note to the contrary, in no event shall the interest
contracted for, charged or received in connection with this Note (including any other costs or
considerations that constitute interest under the laws of the State of Florida which are contracted
for, charged or received)exceed the maximum rate of nonusurious interest allowed under the State
of Florida as presently in effect and to the extent an increase is allowable by such laws, but in no
event shall any amount ever be paid or payable by the City greater than the amount contracted for
herein.
THIS NOTE SHALL NOT BE OR CONSTITUTE AN INDEBTEDNESS OF THE CITY
OR THE STATE OF FLORIDA (THE "STATE"), WITHIN THE MEANING OF ANY
CONSTITUTIONAL, STATUTORY OR CHARTER LIMITATIONS OF INDEBTEDNESS,
BUT SHALL BE PAYABLE SOLELY FROM THE PLEDGED REVENUES, AS PROVIDED
IN THE AGREEMENT AND THE RESOLUTION. THE HOLDER SHALL NEVER HAVE
THE RIGHT TO COMPEL THE EXERCISE OF THE AD VALOREM TAXING POWER OF
THE CITY, OR TAXATION IN ANY FORM OF ANY PROPERTY THEREIN TO PAY THIS
NOTE OR THE INTEREST THEREON.
Upon the occurrence of an Event of Default, the Holder shall also have such remedies as
described in the Agreement and the Original Instrument.
Exhibit A-2
54828878;2
47
The City hereby waives presentment, demand, protest and notice of dishonor. This Note
is governed and controlled by the Agreement and reference is hereby made thereto regarding
interest rate adjustments and other matters.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Exhibit A-3
54828878;2
48
IN WITNESS WHEREOF, the City has caused this Note to be signed by its Mayor, either
manually or with facsimile signature, and the seal of the City to be affixed hereto or imprinted or
reproduced hereon, and attested by the Clerk of the City, either manually or with facsimile
signature, and this Note is dated the Date of Issuance set forth above.
CITY OF WINTER SPRINGS, FLORIDA
[SEAL]
By:
Charles Lacey, Mayor
ATTEST:
By:
Christian Gowan, City Clerk
Approved As To Form:
Anthony Garganese, City Attorney
Exhibit A-4
54828878;2
49
FORM OF CERTIFICATE OF AUTHENTICATION
Date of Authentication:
This Note is being delivered pursuant to the within mentioned Agreement.
CITY OF WINTER SPRINGS, FLORIDA,
as Registrar
By:
Christian Gowan, City Clerk
Exhibit A-5
54828878;2
50
ASSIGNMENT
FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto
(please print or typewrite name, address
and tax identification number of assignee) the
within Note and all rights thereunder, and hereby irrevocably constitutes and appoints
Attorney to transfer the within Note on the books kept for
registration thereof, with full power of substitution in the premises.
Name of Noteholder:
By:
Exhibit A-6
54828878;2
51
Schedule I
Principal on this Note shall be payable on April 1 and October 1 and in the following
amounts:
Year Principal Amortization
4/l/2021 $
10/1/2021
4/l/2022
10/1/2022
4/1/2023
10/1/2023
4/l/2024
10/1/2024
4/1/2025
10/1/2025
4/l/2026
10/1/2026
4/1/2027
10/1/2027
4/1/2028
10/1/2028
4/l/2029
10/1/2029
4/1/2030
10/1/2030
4/1/2031
10/1/2031
4/1/2032
10/1/2032
Exhibit A-7
54828878;2
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FORM OF PURCHASER CERTIFICATE
City Commission
City of Winter Springs, FL
Ladies and Gentlemen:
The undersigned, as a purchaser of the City of Winter Springs, Florida Water and Sewer
Revenue Refunding Note, Series 2020 (the "Note") dated October 15, 2020, consisting of one
typewritten Note, hereby certifies that we have been provided (a) a copy of Resolution No. 2020-
27, adopted by the City Commission on October 12, 2020, authorizing the issuance of the Note
(the "Resolution"), (b) the Loan Agreement dated October 15, 2020, between the City of Winter
Springs,Florida(the "City")and us as assignee(the "Agreement") (c)the Original Instrument(as
defined in the Agreement) and (d) such other documents including financial and general
information respecting the Pledged Revenues (as such term is defined in the Agreement) as we
deem necessary to enable us to make an informed investment judgment with respect to the
purchase of the Note.
We hereby make the following representations, which representations may be relied upon
by the addressees:
A. We are aware:
(i) that investment in the Note involves various risks;
(ii) that the Note is not a general obligation of the City; and
(iii) that the principal or premium, if any, and interest on the Note is payable
from and secured solely by the Pledged Revenues as specified in the
Agreement.
B. We understand that no official statement, offering memorandum or other form of
offering document was prepared or is being used in connection with the sale of the
Note (collectively, "Disclosure Documents"), but we have been afforded access to
all information we have requested in making our decision to purchase the Note and
have had sufficient opportunity to discuss the Pledged Revenues with the officers
and employees of the City and others as we have deemed necessary. We have not
requested any Disclosure Documents in connection with our purchase of the Note.
We do not require any further information or data incident to our purchase of the
Note.
C. In purchasing the Note, we have made our own inquiry and analysis with respect to
the Note and the security therefor, and other material matters affecting the security
and payment of the Note. We are aware that revenue obligations such as the Note
A-1
54828878;2
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involve certain economic variables and risks that could affect the security of the
Note.
D. We have knowledge and experience in financial and business matters and are
capable of evaluating the merits and risks of our investment in the Note and have
determined that we can bear the economic risk of our investment in the Note.
E. We acknowledge the understanding that the Note is not being registered under the
Securities Act of 1933, as amended (the "1933 Act") or Chapter 517, Florida
Statutes, and that the Resolution and Agreement are not being qualified under the
Trust Indenture Act of 1939, as amended, and that the City shall have no obligation
to effect any such registration or qualification.
F. We are making the loan and purchasing the Note for our own account. We do not
currently intend to syndicate the Note. Although we retain the right to transfer the
Note in the future, we understand that the Note may not be readily transferable.
G. We have received all documents which documents incorporate all provisions
requested by us incident to our purchase of the Note. The Agreement and Note
describe the actual terms of the Note and the security therefor.
H. We acknowledge that we are an "accredited investor" within the meaning of
Chapter 517, Florida Statutes and Regulation D of the 1933 Act.
I. We have not asked that the Note bear a CUSIP and we do not intend to seek a
CUSIP for the Note.
J. We understand that whether a filing is made with respect to the Note with EMMA,
the Municipal Securities Rulemaking Board's continuing disclosure site is at the
discretion of the City.
L. We have a present intent to hold the Note to maturity, earlier redemption,
mandatory tender, or for our loan portfolio, and have no present intention of
reselling or otherwise disposing of all or part of such Note.
Signed as of the day of
By:
A-2
54828878;2
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BB&T Branch Banking &Trust Company
Governmental Finance
5130 Parkway Plaza Boulevard
Charlotte,North Carolina 28217
Phone(704)954-1700
Fax(704)9 54-17 99
September 18,2020
Ms.Maria Sonksen
Winter Springs,FL
1126 East State Road 434
Winter Springs,FL 32708
Dear Ms. Sonksen:
Truist Bank ("Lender") is pleased to offer this proposal for the financing requested by the City of Winter
Springs ("Borrower").
PROJECT: Water& Sewer Revenue Refunding Note, Series 2020
AMOUNT: $3,200,000.00(not to exceed)
MATURITY DATE: October 1,2030
October 1,2032
INTEREST RATE: 1.69% (2030 Maturity)
1.72% (2032 Maturity)
TAX STATUS: Tax Exempt—Bank Qualified
PAYMENTS: Interest:Semi-Annual
Principal: Annual
INTEREST RATE
CALCULATION: 30/360
SECURITY: Pledge of revenues derived from the Borrower's combined water and sewer
system.
PREPAYMENT
TERMS: Prepayable in whole at any time with a one percent prepayment penalty. As an
alternative, the Borrower may elect to have the transaction be non-callable for the
first half of the term,then prepayable in whole without penalty.
RATE
EXPIRATION: November 2, 2020
DOCUMENTATION/
LEGAL REVIEW
FEE: $7,500
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FUNDING: The financing shall be fully funded at closing and allow for a maximum of four
funding disbursements in the form of wires or checks.
DOCUMENTATION: It shall be the responsibility of the Borrower to retain and compensate counsel to
appropriately structure the financing documents according to Federal and State
statutes. Documents shall include provisions that will outline appropriate changes
to be implemented in the event that this transaction is determined to be taxable or
non-bank qualified in accordance with the Internal Revenue Code. These
provisions must be acceptable to Lender. In the event of default, any amount due,
and not yet paid, shall bear interest at a default rate equal to the interest rate on the
Water & Sewer Revenue Refunding Note, Series 2020 plus 2% per annum from
and after five (5)days after the date due.
Lender shall also require the Borrower to provide an unqualified bond counsel
opinion, a no litigation certificate, and evidence of IRS Form 8038 filing. Lender
and its counsel reserve the right to review and approve all documentation before
closing. Lender will not be required to present the bond for payment.
REPORTING
REQUIREMENTS: Lender will require financial statements to be delivered within 270 days after the
conclusion of each fiscal year-end throughout the term of the financing or in
accordance with state requirements.
Lender shall have the right to cancel this offer by notifying the Borrower of its election to do so(whether this
offer has previously been accepted by the Borrower) if at any time prior to the closing there is a material
adverse change in the Borrower's financial condition,if we discover adverse circumstances of which we are
currently unaware, if we are unable to agree on acceptable documentation with the Borrower or if there is a
change in law (or proposed change in law)that changes the economic effect of this financing to Lender.
Costs of counsel for the Borrower and any other costs will be the responsibility of the Borrower.
The stated interest rate assumes that the Borrower expects to borrow no more than$10,000,000 in the current
calendar year and that the financing will qualify as qualified tax-exempt financing under the Internal Revenue
Code. Lender reserves the right to terminate this bid or to negotiate a mutually acceptable interest rate if the
financing is not qualified tax-exempt financing.
We appreciate the opportunity to offer this financing proposal. Please call me at (803) 251-1328 with your
questions and comments. We look forwardto hearing from you.
Sincerely,
Truist Bank
ZAW,1
Andrew G. Smith
Senior Vice President
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