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HomeMy WebLinkAboutResolution 435 Revenue Bonds RESOLUTION NO. 435 A RESOLUTION AUTHORI ZING THE ISSUANCE OF NOT EXCEEDING $6,000,000 WATER AND SEWER REVENUE BONDS, SERIES 1983, OF THE CITY OF WINTER SPRINGS, FLORIDA TO FINANCE THE COST OF ACQUIRING A WATER AND SEWER SYSTEM FOR THE CITY AND CONSTRUCTING IMPROVEMENTS TO SAID SYSTEM; PROVIDING FOR THE PAYMENT OF THE BONDS FROM THE NET REVENUES OF THE SYSTEM; MAKING OTHER COVENANTS AND AGREEMENTS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA: SECTION 1. AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted pursuant to the Constitution of the State of Florida; Chapter 166, Part III, Florida Statutes, as amended and supple- mented, and other applicable provisions of law. SECTION 2. DEFINITIONS. Unless the context otherwise re- quires, the terms defined in this section shall have the meanings specified in this section. Words importing singular number shall include the plural number in each case and vice versa, and words importing persons shall include firms and corporations. (A) II ACQUISITION AND IMPROVEMENT FUND II shall mean the City of Winter Springs Acquisition and Improvement Fund created and established pursuant to Section 17 of this Resolution. (B) II ACT II shall mean Chapter 166, Part II I, Flor ida Stat- utes, and other applicable provisions of law. (C) II ADDITIONAL PARITY OBLIGATIONS" shall mean add it ional obI igat ions issued in compl iance wi th the terms, condi tions and limitations contained herein which have an equal lien on the Net Revenues as herein defined, and rank equally in all respects with the Bonds issued hereunder. (D) "AMORTIZATION INSTALLMENT" with respect to any Term Bonds of a series, shall mean an amount so designated for manda- tory principal installments (for mandatory call or otherwise) ,payable on any Term Bonds issued under the provisions of this Resolution or any subsequent resolution authori zing Additional Parity Obligations. (E) "BOND SERVICE REQUIREMENT" for any Bond Year shall mean the sum of: (I) The amount required to pay the interest becoming due on the Outstanding Bonds during such Bond Year, except to the extent that such interest shall have been provided by payments into the Interest Account in the Debt Service Fund out of Bond proceeds for a specified period of time. (2) The amount required to pay the principal of Out- standing Serial Bonds maturing in such Bond Year. (3) The Amortization Installment for the Outstanding Term Bonds due in such Bond Year. When determining the amount of principal of and interest on Outstanding Bonds which mature in any year, for purposes of this instrument or the issuance of any Additional Parity Obligations, the stated maturity date of Term Bonds shall be disregarded and the Amortization Installment, if any, applicable to Term Bonds in such year shall be deemed to mature in such year. (F) "BOND YEAR" shall mean the period beginning with October 1 of each year and extending for a period of twelve (12) months thereafter. (G) "BONDS" shall mean the Water and Sewer Revenue Bonds issued hereunder, together with any Additional Parity Obligations hereafter issued under the terms, conditions and limitations con- tained herein. (H) "COMPANY" or "the COMPANY" shall mean the North Orlando Water and Sewer Corp., a corporation organized and existing under the laws of the State of Florida. (I) "CONNECTION CHARGES" shall mean all connection fees and charges assessed by the Issuer to users for the purpose of provid- ing initial connection to the System. (J) "CONSULTING ENGINEERS" shall mean qualified and recog- nized consulting engineers, having a favorable reputation for skill and experience in the management and operation of facilities of comparable size and character as the System, at the time 2 retained by the Issuer to perform the acts and carry out the du- ties as herein provided for such consulting engineers. (K) "COST OF OPERATION AND MAINTENANCE" of the System shall mean the current expenses, paid or accrued, in the operation, maintenance and repair of the System, as calculated in accordance with sound accounting practice, but shall not include any reserve for renewals and replacements, extraordinary repairs or any allow- ance for depreciation. (L) "DEBT SERVICE FUND" shall mean the City of Winter Springs Water and Sewer Debt Service Fund, which fund shall have within it an Interest Account, a Principal Account, a Redemption Account and a Reserve Account. (M) "FEDERAL SECURITIES" shall mean direct obligations of, or obligations the principal of and interest on which are uncondi- tionally guaranteed by the United States of America, which are not redeemable prior to maturity at the option of the obligor. (N) "FISCAL YEAR" shall mean the period commencing on October 1 of each year and ending on the succeeding September 30. (0) "GROSS REVENUES" or "REVENUES" shall mean all income or earnings, including Connection Charges, except the first $600,000 of said Connection Charges, collected by the City from the date of the issuance of the Bonds, from any source received by the Issuer or accrued to the Issuer from the ownership or operat ion of the System and all parts thereof, including investment income, if any, earned on any fund or account, all as calculated in accordance with sound accounting practice, but "Gross Revenues" or "Revenues" shall not include proceeds from the sale or other disposition of the System or any part thereof, condemnation awards or proceeds of insurance received with respect to the System. Provided however, "Gross Revenues" or "Revenues" shall include proceeds from the sale or other disposition of the System or any part thereof to any uni t of local government created by special act of the Florida Legislature for the purpose of owning and operating water and sewer facilities. 3 (P) "INVESTMENT SECURITIES" means any of the following, if and to the extent that the same are legal for the investment of the proceeds of the Bonds and the Net Revenues: (i) direct obliga- tions of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America; (ii) bonds, debentures, notes or participation certificates issued by the Federal Banks for Cooperatives, the Federal Intermediate Credit Banks, the Federal Horne Loan Banks, the Export-Import Bank of the United States, the Federal Land Banks, the Federal National Mortgage Association, the Government National Mortgage Associa- tion, and direct and general obligations of any agency or instru- mental i ty of the United States of America not included in the foregoing listing; (iii) Public Housing Bonds and Project Notes fully secured by contracts with the United States; (iv) full faith and credit direct general obligations of any state, or unlimited tax direct obligations of any political subdivision thereof, to the payment of which the full faith and credit of such political subdivision is pledged, provided that at the time of purchase such obligations are rated in either of the two highest rating cate- gories by a nationally recognized bond rating agency; and (v) negotiable or non-negotiable certificates of deposit or time deposi ts issued by any bank, trust company or national banking association which is a member of the Federal Reserve System, prov ided that (a) such certi f icates of deposi t or time deposits shall continuously be collaterally secured by investments listed under clauses (i) through (iv) above having a market value (exclu- sive of accrued interest) at all times at least equal to such certificates of deposi t or time deposi ts and such investments securing such certificates of deposit or time deposits, and collateral therefor if required by law, shall be deposited with such public officer or public or private institution as shall be provided for the deposi t of securi ty for the deposi t of publ ic moneys under the laws of the State of Florida, or, if there is no such provision, with such officer of the Issuer as designated by 4 the City; or (b) the amount of such certificates of deposit or time deposits purchased or obtained from any bank, trust company or national association shall not exceed twenty-five percent (25%) of its capital and surplus or such other limit, if any, as may be required by the laws of the State of Florida. (Q) "ISSUER" or "CITY" shall mean the City of Winter Springs, Florida. (R) "MAXIMUM BOND SERVICE REQUIREMENT" shall mean, as of any particula~ date of calculation, the greatest amount of aggregate Bond Service Requirement for the then current or any future Bond Year. (S) "NET REVENUES" of the System shall mean the Revenues or Gross Revenues, as defined above, after deduction of the Cost of Operation and Maintenance, as defined above. (T) "OUTSTANDING" when used in reference to the Bonds, means as of a particular date, all Bonds authorized and issued by the Issuer, except: (i) any Bonds canceled at or before such date; (ii) any Bonds for which provisions for payment pursuant to this Resolution have been made and (iii) any Bond in lieu of or in substitution for which another Bond shall have been authorized and del ivered pursuant to Section 11 or Section 13 of this Resolu- tion. (U) "OWNER OF BONDS" or "OWNER" or any similar term shall mean any person who shall be the registered owner of any such Bond or Bonds. (V) "PAYING AGENT" shall mean the paying agent, the co-paying agent or any successor paying agent to be appointed by subsequent resolution of the Issuer and at the time serving under this Resolution. (W) "PROJECT" shall mean the acquisition and improvement of a water and sewer system currently owned by the Company, pursuant to plans and specifications on file or to be filed with the Clerk of the City. 5 (X) "RENEWAL AND REPLACEMENT FUND" shall mean the City of Winter Springs Water and Sewer Renewal and Replacement Fund creat- ed and established pursuant to Section 19B(4) of this Resolution. (Y) "RESERVE REQUIREMENT" shall mean, in any year, the Maxi- mum Bond Service Requirement, if any, on the Bonds becoming due in any ensuing Fiscal Year. (Z) "RETAINED EARNINGS" shall have the same meaning as is ascribed to such term by generally recognized principles and stan- dards of public financial reporting, and notwithstanding the gen- erality of the foregoing, shall mean the accumulated earnings of the System which have been retained in the Revenue Fund and which are not reserved for any specific purpose. (AA) "SERIAL BONDS" shall mean the Bonds of a series which shall be stated to mature in annual or semi-annual installments. (BB) "SINKING FUND DEPOSIT" shall mean, in any Bond Year, the amount required to be deposited for the benefit of the Bonds into the Debt Service Fund in such year pursuant to this Resolution, and any supplemental resolution as provided herein. (CC) "SYSTEM" shall mean the properties and assets, real and personal, tangible and intangible, owned or operated by the Issuer, used or useful for the collect ion, transmiss ion, trea t- ment, and disposal of sewage, and for the supply, storage, treat- ment, transmission and distribution of water, and all properties and assets hereafter constructed or acquired as addi tions, im- provements, betterments or replacements thereto and extensions thereof. (DO) "TERM BONDS" shall mean the Bonds of a series, all of which shall be stated to mature on one date. SECTION 3. FINDINGS. It is hereby ascertained, determined and declared: (A) The Company now owns, operates and maintains the System as defined and described herein, and derives revenues from rates, fees, rentals and other charges made and collected for the ser- vices of the System. 6 (B) The System is one of two water and sewer systems cur- rently being operated in the corporate limits of the Issuer. (C) That in order to maintain and operate said System for the protection of the heal th, safety and wel fare of the Issuer, its inhabi tants and other users it is des i rable that the Issuer issue its Bonds to pro v ide funds to purchase and improve the system, as provided in this Resolution. (D) The the Ci ty expects to der i ve revenues from rates, fees, rentals and other charges made and collected for the services and facilities of said System and said revenues are not pledged or encumbered in any manner. (E) That the Bonds shall be issued solely for the purpose of acquiring and improving the System and facilities related thereto. (F) That the aforesaid System shall be acquired and improved substantially in accordance with the engineering report and plans and specifications heretofore filed or to be filed in the office of the City Clerk, as the same may be revised from time to time by the Consul ting Eng ineer and/or eng ineers retained by the Issuer with the approval of the City Council. (G) The principal of and interest on the Bonds and all required Sinking Fund Account, reserve and other payments shall be payable solely from the Net Revenues as provided herein. The Issuer shall never be required to levy ad valorem taxes on any real or personal property therein to pay the principal of and interest on the Bonds herein authorized or to make any other pay- ments provided for herein. The Bonds shall not constitute a lien upon any properties owned by or located within the boundaries of the Issuer. (H) The Net Revenues are estimated to be sufficient to pay all principal of and interest on the Bonds to be issued hereunder, as the same become due, and to make all required Debt Service Fund, Reserve Account or other payments required by this Resolu- tion. 7 SECTION 4. AUTHORI ZATION OF ACQU IS ITION AND IMPROVEMENT OF PROJECT.There is hereby authorized the acquisition and improvement of the Project all pursuant to the reports and the plans and specifications on file in the office of the City Clerk or hereafter to be on file therein. In addition to the items set forth in the plans and specifications, cost of the Project may In- clude, but need not be limited to, the acquisition of any lands or interest therein or any other properties deemed necessary or con- venient therefor; englneerlng, legal and financing fees and expenses; expenses for estimates of costs and of revenues; expenses for plans, specifications and surveys; the fees of fiscal agent, accountants, financial advisors or consultants; administra- tive expenses relating solely to the construction and acquisition of the project; the capitalization of interest for a reasonable period after the issuance of the Bonds; the creation and establishment of reasonable reserves for debt service;bond discount; and such other fees, costs and expenses as may be necessary or incidental to the financing herein authorized and the construction and acquisi tion of the Project and the placing of same in operation. SECTION 5. THIS RESOLUTION TO CONSTITUTE CONTRACT. In con- sideration of the acceptance of the Bonds authorized to be issued hereunder by those who shall own the same from time to time, this Resolution shall be deemed to be and shall constitute a contract between the Issuer and such Owners. The covenants and agreements herein set forth to be performed by the Issuer shall be for the equal benefit, protection and security of the legal Owners of any and all of the Bonds, all of which shall be of equal rank and without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided therein and herein. SECTION 6. AUTHORIZATION OF BONDS. Subject and pursuant to the provisions hereof, obligations of the Issuer to be known as "Water and Sewer Revenue Bonds, Series 1983", herein defined as 8 the "Bonds", are authorized to be issued in the aggregate princi- pal amount of not exceeding $6,000,000. SECTION 7. DESCRIPTION OF BONDS. The Bonds shall be issued in fully registered form; shall be dated; shall be numbered con- secutively from R-l upward; shall be in the denomination of $5,000 each, or integral multiples thereof; shall bear interest at such rate or rates not exceeding the maximum rate allowed by Florida law, the actual rate or rates to be determined by the governing body of the Issuer by resolution prior to or upon the sale of the Bonds; such interest to be payable semiannually on April 1 and October 1 of each year; and shall mature on October 1 in such years and amounts as will be fixed by resolution of the Issuer prior to or upon the sale of the Bonds and may be Serial and/or Term Bonds. Each Bond shall bear interest from the interest payment date next preceding the date on which it is authenticated, unless au- thenticated on an interest payment date, in which case it shall bear interest from such interest payment date, or, unless authen- ticated prior to the first interest payment date, in which case it shall bear interest from its date; provided, however, that if at the time of authentication interest is in default, such Bond shall bear interest from the date to which interest shall have been paid.The principal of and the interest on the Bonds shall be pay- able in any coin or currency of the united States of America which on the respective dates of payment thereof is legal tender for the payment of public and private debts. The principal of the Bonds shall be payable only to the registered Owner or his legal repre- sentative at the principal corporate trust office of the Paying Agent, and payment of the interest on the Bonds shall be made by the Paying Agent on each interest payment date to the person ap- pearing on the registration books of the Issuer hereinafter pro- vided for as the registered Owner thereof, by wire transfer or check mailed to such registered Owner at his address as it appears 9 on such registration books. Payment of the principal of all Bonds shall be made upon the presentation and surrender of such Bonds as the same shall become due and payable. SECTION 8. EXECUTION OF BONDS. The Bonds shall be signed by, or bear the facsimile signature of, the Mayor and shall be signed by, or bear the facsimile signature of, the City Clerk and a facsimile of the official seal of the Issuer shall be im- printed on the Bonds. In case any officer whose signature or a facsimile of whose signature shall appear on any Bonds shall cease to be such officer before the delivery of such Bonds, such signature or such facsimi- le shall nevertheless be valid and sufficient for all purposes the same as if he has remained in office until such delivery, and also any Bond may bear the facsimile signature of or may be signed by such persons who, as at the actual time of the execution of such Bond, shall be the proper officers to sign such Bonds although at the date of such Bond such persons may not have been such offic- ers. SECTION 9. AUTHENTICATION OF BONDS. Only such of the Bonds as shall have endorsed thereon a certificate of authentication substantially in the form hereinbelow set forth, duly executed by the Paying Agent, as authenticating agent, shall be entitled to any benefit or security under this Resolution. No Bond shall be valid or obligatory for any purpose unless and until such certifi- cate of authentication shall have been duly executed by the Paying Agent, and such certificate of the Paying Agent upon any such Bond shall be conclusive evidence that such Bond has been duly authen- ticated and delivered under this Resoltuion. The Paying Agent's certificate of authentication on any Bond shall be deemed to have been duly executed if signed by an authorized officer of the Paying Agent, but it shall not be necessary that the same officer sign the certificate of authentication of all of the Bonds that may be issued hereunder at anyone time. 10 SECTION 10. EXCHANGE OF BONDS. Any Bond, upon surrender thereof at the principal corporate trust office of the Paying Agent, together with an assignment duly executed by the Owner or his attorney or legal representative in such form as shall be satisfactory to the Paying Agent, may, at the option of the Owner, be exchanged for an aggregate principal amount of Bonds equal to the principal amount of the Bond or Bonds so surrendered. The Paying Agent shall make provision for the exchange of Bonds at the principal corporate trust office of the Paying Agent. SECTION 11. NEGOTIABILITY, REGISTRATION AND TRANSFER OF BONDS. The Paying Agent shall keep books for the registration of and for the registration of transfers of Bonds as provided in this Resolution. The transfer of any Bonds may be registered only upon such books upon surrender thereof to the Paying Agent together with an assignment duly executed by the Owner or his attorney or legal representative in such form as shall be satisfactory to the Paying Agent. Upon any such registration of transfer the Issuer shall execute and the Paying Agent shall authenticate and deliver in exchange for such Bond, a new Bond or Bonds registered in the name of the transferee, and in an aggregate principal amount equal to the principal amount of such Bond or Bonds so surrendered. In all cases in which Bonds shall be exchanged, the Issuer shall execute and the Paying Agent shall authenticate and deliver, at the earliest practicable time, Bonds in accordance with provi- sions of this Resolution. All Bonds surrendered in any such exchange or registration of transfer shall forthwith be cancelled by the Paying Agent. The Issuer or the Paying Agent may make a charge for every such exchange or reg istration of transfer of Bonds sufficient to reimburse it for any tax or other governmental charge required to be paid with respect to such exchange or registration of transfer, but no other charge shall be made to any Owner for the privilege of exchanging or registering the transfer of Bonds under the provisions of this Resolution. Neither the 11 Issuer nor the Paying Agent shall be required to make any such exchange or registration of transfer of Bonds during the fifteen (15) days immediately preceding any interest payment date. SECTION 12. OWNERSHIP OF BONDS. The person in whose name any Bond shall be registered shall be deemed and regarded as the absolute Owner thereof for all purposes and payment of or on account of the principal or redemption price of any such Bond, and the interest on any such Bonds, shall be made only to or upon the order of the registered Owner thereof or his legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond including the premium, if any, and interest thereon to the extent of the sum or sums so paid. SECTION 13. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated, or be destroyed, stolen or lost, the Issuer may in its discretion cause to be executed, and the Paying Agent shall authenticate and deliver, a new Bond of like date and tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond upon surrender and cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed, stolen or lost, and upon the Owner furnishing the Issuer and the Paying Agent proof of his ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer and the Paying Agent may prescribe and paying such expenses as the Issuer and the Paying Agent may incur. All Bonds so surrendered shall be canceled by the Issuer. If any of the Bonds shall have matured or be about to mature, instead of issuing a substi tute Bond, the Issuer may pay the same, upon being indemnified as aforesaid, and if such Bond be lost, stolen or destroyed, without surrender thereof. Any such duplicate Bonds issued pursuant to this section shall constitute original, additional contractual obligations on 12 the part of the Issuer whether or not the lost, stolen or destroy- ed Bonds be at any time found by anyone, and such duplicate Bonds shall be enti tIed to equal and proportionate benefi ts and rights as to lien on and source and security for payment from the funds, as hereinafter pledged, to the same extent as all other Bonds issued hereunder. SECTION 14. PROVISIONS FOR REDEMPTION. The Bonds shall be subject to redemption prior to their maturity, at the option of the Issuer, at such times and in such manner as shall be fixed by resolution of the Issuer prior to or at the time of sale of the Bonds. Notice of such redemption shall, at least thirty (30) days prior to the redemption date, be filed with the Paying Agents; and mailed, postage prepaid, to all Owners of Bonds to be redeemed at their addresses as they appear on the registration books herein- before provided for, but failure to mail such notice to one or more Owners of Bonds shall not affect the validity of the proceed- ings for such redemption with respect to Owners of Bonds to which notice was duly mailed hereunder. Each such notice shall set forth the date fixed for redemption, the redemption price to be paid and, if less than all of the Bonds of one maturity are to be called, the distinctive numbers of such Bonds to be redeemed and in the case of Bonds to be redeemed in part only, the portion of the principal amount thereof to be redeemed. Upon surrender of any Bond for redemption in part only, the Paying Agent shall authenticate and deliver to the Owner thereof, the cost of which shall be paid by the Issuer, a new Bond of an authorized denomination equal to the unredeemed portion of the Bond surrendered. SECTION 15. FORM OF BONDS. The text of the Bonds shall be in substantially the following form, with such omissions, inser- tions and variations as may be necessary and desirable and authorized and permitted by this Resolution or by any subsequent resolution adopted prior to the issuance thereof: 13 No. R - $_________ UNITED STATES OF AMERICA STATE OF FLORIDA COUNTY OF SEMINOLE CITY OF WINTER SPRINGS . WATER AND SEWER REVENUE BONDS, SERIES 1983 KNOW ALL MEN BY THESE PRESENTS, that the City of Winter Springs, Florida (hereinafter called "City"), for value received, hereby promises to pay to the order of___________________ _____________, or registered assigns, as herein provided, on the _____day of _____________, upon the presentation and surrender hereof at the principal corporate trust office of________________ ,___________________________________________ in the City of_____________,Florida (the"Paying Agent"), from the revenues hereinafter mentioned, the principal sum of ______________DOLLARS in any coin or currency of the United States of America which on the date of payment thereof is legal tender for the payment of public and private debts, and to pay, solely from said sources, to the registered owner hereof by check mailed to the registered owner at his address as it appears on the Bond registration books of the City, interest on said principal sum on each April and October commencing ________________ ,_____from the interest payment date next preceding the date of registration and authentication of this ,Bond, unless this Bond is reg istered and authenticated as of an interest payment date, in which case it shall bear interest from said interest payment date, or unless this Bond is registered and authenticated prior to______.______,in which event this bond shall bear interest from_________,______. The Bonds of this issue shall be subject to redemption prior to their maturity at the option of the City. (Insert Optional or Mandatory Redemption Provisions) Notice of such redemption shall be given in the manner re- quired by the Resolution. 14 This Bond is one of an authorized issue of Bonds in the ag- gregate principal amount of $__________ of like date, tenor and effect, except as to number, maturity and interest rate, issued to finance the cost of acqui ring and improv ing a water and sewer system pursuant to the authori ty of and in full compliance with the Constitution and Statutes of the State of Florida, including particularly Chapter 166, Part III, Florida Statutes, and a reso- lution duly adopted by the City on ________, 1983, as supple- mented (hereinafter collectively called "Resolution"), and is sub- ject to all the terms and conditions of such Resolution. This Bond is payable solely from and secured by a prior lien upon and pledge of the Net Revenues, as defined in the Resolution, derived and collected by the City from the operation of the City's Water and Sewer System (the "System"), in the manner provided in the Resolution. This Bond does not constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision or limitation, and it is expressly agreed by the Owner of this Bond that such Owner shall never have the right to require or compel the exercise of the ad valorem taxing power of the City or taxation of any real or personal property therein for the pay- ment of the principal of and interest on this Bond or the making of any Debt Service Fund, reserve or other payments provided for in the Resolution. It is further agreed between the City and the Owner of this Bond that this Bond and the indebtedness evidenced thereby shall not constitute a lien upon the System, or any part thereof, or on any other property of or in the City, but shall constitute a lien only on the Net Revenues derived from the operation of the System all in the manner provided in the Resolution. The City in the Resolution has covenanted and agreed with the Owners of the Bonds of this issue to fix, establish, maintain and collect such rates, fees, rentals and other charges for the ser- vice of the System so as to always provide in each year Revenues, 15 as defined in the Resolution, sufficient to pay the costs of operation and maintenance of the System in such year and all reserve or other payments provided for in the Resolution, and 125% of all debt service requirements coming due' in such year on the Bonds and all outstanding additional parity obligations, and that such rates, fees, rentals and other charges will not be reduced so as to be insufficient to provide Revenues for such purposes. The City has entered into certain further covenants with the Owners of the Bonds of this issue for the terms of which reference is made to the Resolution. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed prece- dent to and in the issuance of this Bond exist, have happened and have been performed in regular and due form and time as required by the laws and Consti tution of the State of Florida applicable thereto, and that the issuance of the Bonds of this issue does not violate any constitutional or statutory limitations or provisions. This Bond is and has all the qualities and incidents of a negotiable instrument under the Uniform Commercial Code - Invest- ment Securities Law of the State of Florida. The transfer of this Bond is iegistrable by the Owner hereof in person or by his attorney or legal representative at the prin- cipal corporate trust office of the Paying Agent but only in the manner and subject to the conditions provided in the Resolution and upon surrender and cancellation of this Bond. This Bond shall not be valid or become obligatory for any purpose or be entitled to any benefit or security under the Reso- lution until it shall have been authenticated by the execution by the Paying Agent of the certificate of authentication endorsed hereon. IN WITNESS WHEREOF, the City of Winter Springs, Florida, has issued this Bond and has caused the same to be signed by the Mayor and countersigned and attested to by the Ci ty Clerk, (the signa- tures of the Mayor and the Ci ty Clerk being authorized to be 16 facsimile of such officersl signatures) and its seal or a facsimile thereof to be affixed,impressed,imprinted, lithographed or reproduced hereon, all as of the______day of CITY OF WINTER SPRINGS, FLORIDA (SEAL) (manual or facsimile) Mayor ATTESTED AND COUNTERSIGNED: (manual or facsimile) City Clerk 17 CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds issued under the provisions of the within mentioned Resolution. Date of Authentication: _________________ ________________________ Paying Agent, as Authenticating Agent ________________________ By (Manual Signature) Authorized Officer ASSIGNMENT AND TRANSFER For value received the undersigned hereby sells, assigns and transfers unto____________________________________ ______________________________________________ (Please insert Social Security of other identifying number of assignee_________________the attached bond of the City of Winter springs, Florida, and does hereby constitute and appoint _____________, attorney, to transfer the said bond on the books kept for registration thereof, with full power of substitution in the premises. Date_____________ _____________________ Signature Guaranteed: __________________________ NOTICE: Signature(s) must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or a trust company. NOTICE: No transfer will be reg- istered and no new Bonds will be issued in the name of the Trans- feree, unless the signature to this assignment corresponds with the name as it appears upon the face of the wi thin Bond in every particular, without alteration or enlargement or any change whatever and the Social Security or Federal Employer Identification Number of the Transferee is supplied. If the Transferee is a trust, the names and Social Security or Fed- eral Employer Identification Num- bers of the settlor and benefi- ciaries of the trust, the Federal Employer Identification Number and date of the trust and the name of the trustee should be supplied. 18 SECTION 16. APPLICATION OF BOND PROCEEDS. The proceeds, including accrued interest and premium, if any, received from the sale of any or all of the Bonds shall be applied by the Issuer simultaneously with the delivery of such Bonds to the purchaser thereof, as follows: (A) The accrued interest shall be deposited in the Interest Account in the Debt Service Fund hereinafter created and estab- lished and shall be used only for the purpose of paying interest becoming due on the Bonds. (B) Unless provided in part or in full from other funds of the City on the date of issuance of the Bonds, a sum sufficient to equal the Reserve Requirement shall be deposi ted in the Reserve Account in the Debt Service Fund, hereinafter created and estab- lished, and shall be used only for the purposes provided therefor. (C) The Issuer shall next pay all legal fees, fees of financial advisors, costs of issuance of the Bonds, and all other similar costs incurred in connection with the issuance of the Bonds. (D) The remaining balance of proceeds of the sale of the Bonds shall be deposited in the Acquisition and Improvement Fund, hereinafter created and established, for the .purpose of acquiring and improving the Project. SECTION 17. ACQUISITION AND IMPROVEMENT FUND. A special fund is hereby created, established and designated as the "City of Winter Springs Acquisition and Improvement Fund" (herein called the "Acquisition and Improvement Fund"). There shall be paid into the Acquisition and Improvement Fund the balance of the proceeds of the sale of the Bonds as provided in Subsection 13(D) hereof. Such fund shall be kept separate and apart from all other accounts of the Issuer, and the moneys on deposit therein shall be withdrawn, used and applied by the Issuer solely to the payment of the cost of the Project and purposes incidental thereto, as here- inabove described and set forth. If for any reason such proceeds 19 or any part thereof are not necessary for or are not applied to the payment of such cost, then the unapplied proceeds shall be deposited by the Issuer in the Reserve Account in the Debt Service Fund to the extent necessary to meet the Reserve Requirement and any balance thereafter shall be transferred to the Renewal and Replacement Fund, hereinafter created and established for the purposes thereof. All such proceeds shall be and constitute trust funds for such purposes, and there is hereby created a lien upon such moneys until so applied in favor of the Owners of Outstanding Bonds. Any funds on deposit in the Acquisition and Improvement Fund which, in the opinion of the Issuer are not immediately necessary for expenditure, as hereinabove provided, may be invested in Investment Securities maturing prior to the time such funds will be needed for the purposes thereof. All such Investment Securi- ties shall be held by the Issuer, and all income derived therefrom shall be retained in the Acquisition and Improvement Fund subject to the application of unapplied proceeds as stated above, provided however, that no use will be made of the proceeds of the Bonds which would cause the same to be "arbitrage bonds" within the meaning of the Internal Revenue Code of 1954. The Issuer at all times while the Bonds and the interest thereon are Outstanding will comply with the requirements of Section 103(c) of the Internal Revenue Code of 1954, as amended, and any val id and applicable rules and regulations promulgated thereunder. SECTION 18. SPECIAL OBLIGATIONS OF ISSUER. The Bonds shall not be or constitute general obligations or indebtedness of the Issuer as "bonds" within the meaning of the Constitution of Florida, but shall be payable solely from and secured by a lien upon and a pledge of the Net Revenues as herein provided. No Owner or Owners of any Bonds issued hereunder shall ever have the right to compel the exercise of the ad valorem taxing power of the Issuer or taxation in any form of any real or personal property therein to pay such principal and interest from any other funds 20 of the Issuer except from the special funds in the manner provided herein. The payment of the principal of and interest on the Bonds shall be secured forthwith equally and ratably by an irrevocable lien on the Net Revenues, as defined herein, from the operation of the System, and the Issuer does irrevocably pledge such Net Reve- nues to the payment of the principal of and interest on the Bonds, for the reserves therefor and for all other required payments. SECTION 19. COVENANTS OF THE ISSUER. For as long as any of the principal of and interest on any of the Bonds shall be Out- standing and unpaid or until there shall have been set apart in the Debt Serv ice Fund, herein establ ished, and in the Reserve Account, herein established, a sum sufficient to pay when due the entire principal or the Bonds remaining unpaid, together with interest accrued and to accrue thereon, the Issuer covenants with the Owners of any and all Bonds as follows: A. REVENUE FUND. The entire Gross Revenues derived from the operation of the System shall upon receipt thereof be deposited in the "City of Winter Springs Water and Sewer Revenue Fund" (herein- after called the "Revenue Fund"), hereby created and established. Such Revenue Fund shall consfitute a trust fund for the purposes herein provided and shall be used only for the purposes and in the manner herein provided. B. DISPOSITION OF REVENUES. All revenues at any time re- maining on deposit in the Revenue Fund after payment of Cost of Operation and Maintenance shall be disposed of on or before the fifteenth day of each month commencing in the month immediately following delivery of the Bonds only in the following manner and in the following order of priority: (1) From the moneys remaining In the Revenue Fund, the Issuer shall next deposi t into a separate fund which is hereby created and designated "City of Winter Springs Water and Sewer Debt Service Fund" (herein called the "Debt Service Fund"), and credit to the following accounts, each on a parity with each other, the following identified sums: 21 (a) Interest Account: One-sixth (1/6) of all interest becoming due on the Bonds on the next semi-annual interest payment date, together with any fees or charges of the Paying Agent there- for. The moneys in the Interest Account sh'all be withdrawn and deposi ted with the Paying Agent for the Bonds on or before each interest payment date in an amount sufficient to pay the interest due on such date and the fees, and charges of the Paying Agents. Such monthly payments shall be increased or decreased proportion- ately prior to the first interest payment date or dates, after making allowance for any deposits made into the Interest Account upon the issuance of the Bonds. (b) Principal Account: Beginning on the first day of the month which is twelve (12) months prior to the first principal maturity date and monthly thereafter, a sum equal to one twelfth (1/12) of the amount which will be sufficient, together with the funds then on deposit therein, to pay the principal (except the principal of which is required to be paid on the Term Bonds from the Redemption Account hereinafter created and established) on the Serial Bonds on the next principal maturi ty date. Such payments shall be increased proportionately prior to the first principal payment date of the Bonds to fuake up any deficiency in the Princi- pal Account. The moneys on deposit in the Principal Account shall be withdrawn and deposited with the Paying Agent for such Bonds on or before each principal maturity date in an amount sufficient to pay the principal maturing on such date and the fees and charges of the Paying Agents. (c) Redemption Account: An amount sufficient to pay any Amortization Installment established by any subsequent resolu- tion of the Issuer. (2) From the moneys on deposit in the Revenue Fund the Issuer shall next deposi t into a special account in the Debt Service Fund hereby created and designated the "Reserve Account", a monthly sum of not less than one-sixtieth (1/60) of the Reserve Requirement. No further deposi ts shall be required to be made 22 into the Reserve Account whenever the full Reserve Requirement shall be on deposit therein. Any withdrawals from the Reserve Account shall be sub- sequently restored from the first moneys available in the Revenue Fund after all required payments from the Revenue Fund (including all deficiencies in prior required payments therefrom) have been made in full. Moneys in the Reserve Account shall be used only for the purpose of paying Bond Service Requirement on the Bonds when the other moneys in the Debt Service Fund are insufficient therefor, and for no other purpose. Whenever the amount on deposit in the Reserve Account exceeds the then current Reserve Requirement, the excess shall be withdrawn from the Reserve Account and deposited in any account in the Debt Service Fund. (3) Upon the issuance of any Additional Parity Obliga- tions under the terms, limitations and conditions as are herein provided, the payments into the several accounts in the Debt Ser- vice Fund, including, if Term Bonds are issued, the Redemption Account, shall be increased in such amounts as shall be necessary to make the payment for the principal of, interest on and reserves for such Additional Parity Obligations on the, same basis as here- inabove provided with respect to the Bonds initially issued under this Resolution. (4) The Issuer shall next apply and deposit monthly from the moneys remaining on deposi t in the Revenue Fund into a special account to be known as the "City of Winter Springs Water and Sewer Renewal and Replacement Fund" (hereinafter called the "Renewal and Replacement Fund"), which fund is hereby created and established, an amount equal to one-twelfth (1/12th) of five percent (5%) of the Gross Revenues received during the immediately preceding Fiscal Year, such deposit to be continued to be made for the purpose of this account; prov ided that no deposi t shall be required to be made so long as there is an amount on deposit in the Renewal and Replacement Fund in the amount of 5% of the Gross 23 Revenues received during the immediately preceeding Fiscal Year. The moneys in the Renewal and Replacement Fund shall be used only for the purpose of paying the cost of extensions, enlargements or . additions to, or the replacement of capital assets of the System and emergency repairs thereto. Such moneys on deposit in such account shall also be used to supplement the Reserve Account in the Debt Service Fund, if necessary, in order to prevent a default in the payment of the principal of and interest on the Bonds. (5) The balance of any moneys remaining in the Revenue Fund after the above required payments have been made may be used for any lawful purpose; provided, however, that none of said money shall be used for any purposes other than those hereinabove speci- f ied unless all current paymen ts, incIuding any deficiencies for prior payments, have been made in full and unless the Issuer shall have complied fully with all the covenants and provisions of this Resolution. (6) The Debt Service Fund (including the Reserve Account and all accounts therein), the Renewal and Replacement Fund, the Revenue Fund, the Acquisit ion and Improvement Fund and any other special funds herein established and created shall con- sti tute trust funds for the purposes prov ided herein for such funds. The money in all such funds shall be continuously secured in the same manner as municipal deposits are authorized to be secured by the laws of the State of Florida. Moneys on deposit in the Revenue Fund, the Debt Service Fund and the Acquisition and Improvement Fund may be invested and reinvested In Investment Securities (or as otherwise provided) which mature not later than the dates on which the moneys on deposit therein will be needed for the purpose of such fund. The moneys in the Renewal and Replacement Fund may be invested up to five (5) years. Moneys in the Reserve Account may be invested and reinvested in Investment Securi ties maturing not later than the last maturity of the bonds or Additional Parity Obligations, if issued. All income on such investments shall be deposited in the respective funds and accounts from which such investments were made and be used for the purposes thereof unless and until the 24 maximum required amount is on deposit therein, and thereafter shall be deposited in the Revenue Fund. (7) In determining the amount of any of the payments required to be made pursuant to this Section 19, credit shall be given for all investment income accruing to the respective funds and accounts described herein, except as otherwise provided. (8) The cash required to be accounted for in each of the funds and accounts described in this section except for the Reserve Account in the Debt Service Fund, and the Renewal and Replacement Fund, may be deposited in a single bank account, pro- vided that adequate accounting records are maintained to reflect and control the restricted allocation of the cash on deposit therein for the various purposes of such funds and accounts as herein provided. The designation and establishment of the various funds in and by this Resolution shall not be construed to require the establishment of any completely independent, self-balancing funds as such term is commonly defined and used in governmental accounting or to hinder or prevent the City from maintaining its records and accounts in the manner set forth by the National Council on Governmental Accounting in the publication titled "Governmental Accounting Auditing and Financial Reporting", but rather is intended solely to constitute an earmarking of certain revenues and assets of the System for certain purposes and to establish certain priorities for application of such revenues and assets as herein provided. The City may maintain separate accounts for the System within the funds and accounts described herein. C. OPERATION AND MAINTENANCE. The Issuer will maintain the System and all parts thereof in good condition and will operate the same in an efficient and economical manner, making such expen- ditures for equipment and for renewals, repairs and replacements as may be proper for the economical operation and maintenance thereof. 25 D. RATE COVENANT. The Issuer will fix, establish, revise from time to time whenever necessary, maintain and collect all such fees, rates, rentals and other charges for the use of the products, services and facilities of the System which will always provide revenues in each year sufficient to pay all the Cost of Operation and Maintenance of the System as the same shall become due plus one hundred twenty-five per centum (125%) of the Bond Service Requirement becoming due in such Bond Year upon the Bonds, Additional Parity Obligations and any other obligations intended to be paid from such Net Revenues after excluding from such Bond Service Requirement payments to be derived for that purpose from other sources. Such rates, fees, rentals or other charges shall not be reduced so as to be insufficient to provide revenues for such purposes. E. BOOKS AND ACCOUNTS: AUDIT. The Issuer shall keep proper books, records and accounts, separate and apart from all other records and accounts, showing correct and complete entries of all transactions of the System. The Owners of any of the Bonds or any duly authorized agent or agents of such Owners shall have the right at any and all reasonable times to inspect such books, records and accounts. The Issuer shall within one hundred twenty (120) days following the close of each Fiscal Year cause an audit of such books, records and accounts to be made by an independent firm of certified public accountants. Each such audit, in addition to whatever matters may be deemed proper by said firm of certified public accountants to be included therein, shall, without limiting the generality of the foregoing, include the following: (1) A statement in reasonable detail of the income and expenditures of the System for such Fiscal Year; (2) Comments regarding any non-compliance by the City in carrying out the accounting requirements of this Resolution. Copies of each such audit report shall be placed on file with the Issuer and be made available at reasonable times for 26 inspection by Owners of Bonds, and shall be sent to the nationally recognized bond rating agencies and to the initial purchasers of the Bonds. F. MORTGAGE OR SALE OF SYSTEM. The Issuer shall not sell, lease, encumber or in any manner dispose of the System as a whole until all of the Bonds or any subsequently issued parity bonds shall have been paid in full as to both principal and interest, provided, however, that this provision and nothing in this Resolu- tion, particularly Paragraph G immediately below, shall prohibit the sale, lease or transfer of the System or any part of the System to another unit of local government established by law for the purpose of owning and operating water and sewer facilities. G. SALE OR DISPOSITION OF CERTAIN PARTS OF SYSTEM. The Issuer may sell or dispose of, for fair market value, any proper- ties or parts of the System which the Consulting Engineer shall certify in writing are not necessary for the continuing operation of the System, and that the sale or disposal of which will not adversely affect the Revenues der i ved from the System to such an extent that the Issuer will fail to comply with the covenants of this Resolution. The proceeds derived from any sale or disposal of any proper- ties or parts of the System as provided for in the above para- graph, in the discret ion of the Issuer, be (I) deposi ted in the Renewal and Replacement Fund and used exclusively for the purpose of paying the cost of extensions, enlargements or additions to, or the replacement of capital assets of the System and for any unu- sual or extraordinary repairs, or for the construction or acquisi- tion of additions, extensions and improvements to the System, or (2) for the purchase or retirement of the Bonds, provided, howev- er, that if the Consul ting Engineer certified that the proceeds are necessary for the purpose stated in part (I) above, such proceeds shall remain in the Renewal and Replacement Fund until such certified requirements are satisfied and the proceeds shall not be used for any other purpose allowed by this Resolution. 27 H. INSURANCE. The Issuer will maintain fire and windstorm insurance on all buildings and structures of the works and proper- ties of the System which are subject to loss through fire or wind- storm, public liability insurance, and such other insurance as is generally carried on similar property at least in such amounts as are normally carried in the operation of a similar public utility system within the State of Florida. Any such insurance shall be placed with a nationally recognized reputable insurer and shall be carried for the benefit of the Owners of the Bonds. In lieu of carrying such insurance the Issuer may self-insure to the extent customary wi th util i ties operating like properties. All moneys received for losses under any such insurance, except public liabi- lity, are hereby pledged by the City as security for the Bonds, until and unless such proceeds are used to remedy the loss or damage for which such proceeds are received, either by repairing the property damage or replacing the property would be possible from the date of the receipt of the proceeds of the insurance. I. NO FREE SERVICE. So long as any Bonds are Outstanding, the Issuer shall not furnish or supply the facilities, services and commodities of the System free of charge to any person, firm or corporation, public or private. The Issuer shall promptly enforce the payment of any and all accounts owing to the Issuer and delinquent, by discontinuing service or by filing suits, actions or proceedings, or by both discontinuance of service and filing suit. Notwithstanding the foregoing, the Issuer shall not be required to impose any fees or charges for the collection, trans- mission, treatment or disposal of storm water runoff or the supply of water to fire service. J. ENFORCEMENT OF COLLECTIONS. The Issuer will diligently enforce and collect the rates, fees and other charges for the ser- vices and facilities of the System herein pledged; will take all steps, actions and proceedings for the enforcement and collection of such rates, charges and fees as shall become delinquent to the full extent permitted or authorized by law; and will maintain 28 accurate records with respect thereof. All such fees, rates, charges and revenues herein pledged shall, as collected, be held in trust to be applied as herein provided. K. REMEDIES. Any Owner of Bonds issued under the provision hereof or any trustee acting for the Owners of such Bonds, may either at law or in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdiction, protect and enforce any and all rights, including the right to the appointment of a receiver, existing under the laws of the State of Florida, or granted and contained herein, and may enforce and compel the per- formance of all duties required herein or by any applicable stat- utes to be performed by the Issuer or by any officer thereof. Nothing herein, however, shall be construed to grant to any Owner of the Bonds any lien on any property of the Issuer. L. CONSULTING ENGINEERS. The Issuer shall employ qualified Consulting Engineers in an advisory capacity to inspect the facil- i ties of the System and to make reports and recommendations wi th respect thereto and concerning the operation, maintenance, re- placements, property addi tions and improvements thereto as re- quested by the Issuer. A copy of each report shall be available and shall remain on file with the City Clerk for public inspec- tion. M. MANDATORY CONNECTIONS. The Issuer will, to the full extent permitted by law, require all lands, buildings and struc- tures within the Issuer's service area, fronting or abutting on the lines of the System, or any part thereof, or which can use the facil i ties of the System to connect wi th and use such facil i ties within ninety (90) days after notification that service is avail- able. The Issuer will not grant a franchise for the operation of any competing utility system until all Bonds issued hereunder to- gether with the interest thereon have been paid in full; provided however, nothing in this Resolution shall effect the validity of any franchises existing on the effective date of this resolution for the operation of any utility system within the City. N. NO COMPETING SYSTEM. To the full extent permitted by law, the Issuer will not grant, or cause, consent to or allow the 29 granting of, any franchise or permit to any person, firm, corpora- tion or body, or agency or instrumentality whatsoever, for the the furnishing of water or sewer services which the Issuer determines will adversely affect the revenues of the System; prov ided how- ever, nothing in this Resolution shall effect the validity of any franchi se ex is t ing on the effect i ve date of this resolut ion for the operation of any utility system within the City. O. ISSUANCE OF OTHER OBLIGATIONS. The Issuer will not issue any other obligations payable from the Revenues of the System nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or other charge having priority to or being on a pari ty wi th the I ien of the Bonds issued pursuant to this Resolution and the interest thereon, upon said Revenues ex- cept under the conditions and in the manner provided herein. Any obligations issued by the Issuer other than the Bonds herein au- thorized and Additional Parity Obligations provided for in Subsection P below, payable from such Revenues, shall contain an express statement that such obligations are junior, inferior and subordinate in all respects to the Bonds herein authorized, as to lien on and source and security for payment from such Revenues. P. ISSUANCE OF ADDITIONAL PARITY OBLIGATIONS. No Additional Parity Obligations, payable on a parity from the Net Revenues of the System with the Bonds herein authorized, shall be issued after the issuance of any Bonds herein authorized, except upon the con- ditions and in the manner hereinafter provided: (1) Any such obligations shall be issued solely for the purpose of extending, enlarging, improving or adding to the facil- i ties of the System and/or to refund any bonds issued for such purposes. (2) There shall have been obtained and filed with the Issuer a certificate of an independent certified public accountant of suitable experience and responsibiIi ty stating: (a) that the books and records of the City relative to the System have been audited by him; (b) the amount of the Net Revenues of the System, derived for the Fiscal Year preceding the date of issuance of the proposed Additional Parity Obligations with respect to which such 30 certificate is made, adjusted as herein below provided; (c) that the aggregate amount of such Net Revenues, as adjusted, from the System, for such preceding Fiscal Year is equal to not less than one hundred twenty-five (125%) percent of the Maximum Bond Service Requirement on (i) all obligations issued under this Resolution, if any, then Outstanding, and (ii) on the Additional Parity Obligations with respect to which such certificate is made. (3) Upon recommendation of the Consulting Engineers, historical Net Revenues of the System may be adjusted for purposes of this Section by including 100% of the additional Net Revenues, which in the opinion of the Consulting Engineer would have been derived by the Issuer from rate increases adopted and in effect before the Additional Parity Obligations are issued. (4) The Issuer shall not be in default in the carrying out of any of the obligations assumed under this Resolution, and all payments required by this Resolution to be made into the funds and accounts establ ished hereunder shall have been made to the full extent required. (5) The resolution authorizing the issuance of the Additional Parity Obligations shall recite that all of the cove- nants contained herein will be applicable to quch Additional Pari- ty Obligations, shall bear interest payable semi-annually on April I and October 1 of each year and shall mature annually or semi- annually on October I and/or April I of the year of maturity thereof. (6) For the purposes of this Subsection Q only, the term Net Revenues shall not include investment income derived from the investment of funds in the Acquisition and Improvement Fund or any similar fund created for any other series of Bonds. SECTION 20. MODIFICATION OR AMENDMENT. No material modifi- cation or amendment of this Resolution or of any resolution amend- atory hereof or supplemental thereto, may be made without the con- sent in writing of the Owners of two-thirds (2/3) or more in prin- cipal amount of the Bonds then Outstanding; provided, however, that no modification or amendment shall permit a change in the 31 maturity of such Bonds or a reduction in the rate of interest thereon, or in the amount of the principal obligation or affecting the unconditional promise of the Issuer to pay the principal of and interest on the Bonds as the same shall come due from the Net Revenues of the System or reduce the percentage of the owners of the Bonds required to consent to any material modification or amendment hereof without the consent in writing of the Owner or Owners of all such Bonds. SECTION 21. DEFEASANCE. If, at any time, the Issuer shall have paid, or shall have made provision for payment of, the prin- cipal, interest and redemption premiums, if any, with respect to the Bonds, then, and in that event, the pledge of and lien on the funds pledged in favor of the Owners of the Bonds shall be no longer in effect. For purposes of the preceding sentence, deposit of sufficient cash and/or Federal Securities or bank certificates of deposi t fully secured as to principal and interest by Federal Securi ties (or deposit of any other securi ties or investments which may be authorized by law from time to time and sufficient under such law to effect such a defeasance) in irrevocable trust wi th a banking institution or,trust company, for the sole benefit of the Owners of the Bonds in respect to which such Federal Secur- ities or certificates of deposit, principal and interest, received will be sufficient to make timely payment of the principal, inter- est and redemption premiums, if any, on the Outstanding Bonds, shall be considered "provision for payment." Nothing herein shall be deemed to require the Issuer to call any of the Outstanding Bonds for redemption prior to maturity pursuant to any applicable optional redemption provisions, or to impair the discretion of the Issuer in determining whether to exercise any such option for early redemption. SECTION 22. VALIDATION AUTHORI ZED. The City Attorney, in cooperation with Bond Counsel retained by the Issuer, is hereby authorized to institute appropriate proceedings in the Circuit Court for the Eighteenth Judicial Circuit in and for Seminole County, Florida, for the validation of the Bonds and all 32 proceedings relating to the issuance of the Bonds, and the proper officers of the Issuer are hereby authorized to verify on behalf of the Issuer any pleadings in such proceedings. SECTION 23. SEVERABILITY. If anyone or more of the cove- nants, agreements or provisions of this Resolution should be held contrary to any express provision of law or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agree- ments or provisions of this Resolution or of the Bonds issued hereunder. SECTION 24. EFFECTIVE DATE. This Resolution shall become effective immediately upon its adoption. ADOPTED this 22nd day of Nov., 1983. JOHN V. TORCASO, MAYOR (SEAL) ATTEST: Mary T. Norton City Clerk Approved as to Form and Legal Sufficiency: ____________________ City Attorney 33