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HomeMy WebLinkAboutResolution 2001-11 TLBD RESOLUTION NO, 2001-11 A RESOLUTION OF THE CITY OF WINTER SPRINGS, FLORIDA AMENDING AND RESTATING IN ITS ENTIRETY RESOLUTION NO, 895 OF THE CITY BY AUTHORIZING THE ISSUANCE BY THE CITY OF NOT EXCEEDING $2,500,000 IN AGGREGATE PRINCIPAL AMOUNT OF SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2001 (TUSCA WILLA IMPROVEMENT AREA), TO FINANCE A PART OF THE COST OF CONSTRUCTING RIGHTS-OF- WAY, SUBDIVISION WALLS AND SUBDIVISION ENTRANCEW A YS WITHIN THE TUSCA WILLA LIGHTING AND BEA UTIFICA TION DISTRICT, TO PURCHASE A SURETY BOND FOR DEPOSIT TO THE RESERVE FUND AND TO PAY THE COSTS OF ISSUANCE OF THE BONDS; PLEDGING TO SECURE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THE BONDS, CERTAIN PLEDGED REVENUES INCLUDING THE PROCEEDS OF THE NON-AD VALOREM SPECIAL ASSESSMENTS LEVIED BY THE CITY AGAINST PROPERTY WITH SUCH ASSESSMENT AREA SPECIALLY BENEFITTED BY SUCH PROJECT AND THE FIRST ONE HUNDRED AND SIXTY THOUSAND DOLLARS ($160,000.00) OF HALF-CENT SALES TAX RECEIVED BY THE CITY IN EACH FISCAL YEAR OF THE CITY ; DELEGATING TO THE CITY MANAGER SUBJECT TO COMPLIANCE WITH THE APPLICABLE PROVISION HEREOF, THE AUTHORITY TO A WARD THE SALE OF SUCH BONDS BY EXECUTING AND DELIVERING TO THE UNDERWRITERS OF SUCH BONDS A BOND PURCHASE CONTRACT; ACCEPTING THE COMMITMENT OF FINANCIAL SECURITY ASSURANCE INC. FOR THE ISSUANCE OF A BOND INSURANCE POLICY FOR SUCH BONDS; AND THE COMMITMENT OF FINANCIAL SECURITY ASSURANCE INC. FOR THE ISSUANCE OF A SURETY BOND FOR DEPOSIT TO THE RESERVE FUND FOR SUCH BONDS; APPROVING FORM OF SAID BONDS; APPROVING THE FORM OF AND AUTHORIZING THE DISSEMINATION OF THE PRELIMINARY OFFICIAL STATEMENT AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE FINAL OFFICIAL STATEMENT; AUTHORIZING CERTAIN OFFICIALS AND EMPLOYEES OF CITY OF WINTER SPRINGS, FLORIDA TO TAKE ALL ACTIONS REQUIRED IN CONNECTION WITH THE ISSUANCE, SALE AND DELIVERY OF SAID BONDS; DESIGNATING THE BONDS AS BANK QUALIFIED; APPOINTING THE PA YING AGENT AND REGISTRAR FOR THE BONDS; APPROVING A BOOK-ENTRY SYSTEM OF REGISTRATION FOR THE BONDS; MAKING CERTAIN COVENANTS AND AGREEMENTS FOR THE BENEFIT OF THE HOLDERS OF THE BONDS; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA: OR373052;6 SECTION 1, AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted pursuant to Chapter 166, Part II, Florida Statutes Chapter 72-718, Laws of Florida, Special Acts of 1972 as amended and supplemented, being the Charter of the City of Winter Springs, Florida, and other applicable provisions of law. SECTION 2, DEFINITIONS, Unless the context otherwise requires, the terms defined in this Resolution 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, "Acquired Obligations" shall mean and include any of the following securities, if and to the extent the same are at the time legal for investment of funds of the Issuer: (i) any bonds or other obligations which as to principal and interest constitute direct obligations of, or are unconditionally guaranteed by, the United States of America, including obligations of any Federal agency or corporation which has been or may hereafter be created pursuant to an act of Congress as an agency or instrumentality of the United States of America to the extent unconditionally guaranteed by the United States of America or any other evidences of an ownership interest in obligations or in specified portions thereof (which may consist of specified portions of the interest thereon) of the character described in this clause (i) held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor on the obligations described in this clause (i), and which underlying obligations are not available to satisfy any claim of the custodian or any person claiming through the custodian or to whom the custodian may be obligated; and (ii) any bonds or other obligations of (a) the State of Florida or any governmental unit thereof or (b) any other state of the United States or governmental unit thereof, the interest on which is excluded from gross income for federal income tax purposes and which are rated at such time in the then highest rating category of two or more nationally recognized municipal rating agencies; and (iii) any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state (a) which are not callable at the option of the obligor prior to maturity or as to which irrevocable notice has been given by the obligor to call such bonds or obligations on the date specified in the notice, (b) which are fully secured as to principal and interest and redemption premium, if any, by a fund consisting only of cash or bonds or other obligations of the character described in clause (i) hereof which fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (c) as to which the principal of and interest on the bonds and obligations of the character described in clause (i) hereof which have been deposited in such fund along with any cash on deposit in such fund is sufficient to pay principal of and interest and redemption premium, if any, on the bonds OR373052;6 2 or other obligations described in this clause (iii) on the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to in subclause (a) of this clause (iii), as appropriate, "Amortization Installment" shall mean an amount designated as such by supplemental resolution of the Issuer and established with respect to any Term Bonds, "Assessment Area" shall mean that area within the City designated as the Tuscawilla Improvement Area pursuant to City Resolution No, 99-884 as amended and supplemented, "Assessments" shall mean the proceeds to be derived from the special assessments imposed and levied by the City for the payment of the Project Cost of Local Improvements (as defined in City Ordinance 98-704) against the property within the Tuscawilla Improvement Area to be specially benefitted by the construction of the Project, including interest on such Assessments and any penalties thereon and moneys received upon the foreclosure of the liens of any such Assessments, but excluding moneys recovered for the expense of collecting Assessments. " Average Annual Bond Service Requirement" shall mean, the total amount of Bond Service Requirement which is to become due on all Bonds deemed to be Outstanding immediately after the issuance of the Bonds divided by the total number of years for which Bonds are deemed to be Outstanding, except that with respect to any Bonds for which Amortization Installments have been established, the amount of principal coming due on the final maturity date with respect to such Bonds shall be reduced by the aggregate principal amount of such Bonds that are to, be redeemed from Amortization Installments to be made in prior Bond Years, "Bond Counsel" shall mean Akerman, Senterfitt & Eidson, P,A, or any other attorney at law or firm of attorneys of nationally recognized standing in matters pertaining to the exclusion from gross income for federal income tax purposes of interest on obligations issued by states and political subdivisions, and duly admitted to practice law before the highest court of any state of the United States of America. "Bond Insurance Policy," shall mean the municipal bond insurance policy issued by the Bond Insurer that guarantees the scheduled payment of principal of, and interest on, the Bonds when due, "Bond Insurer, " with respect to the Bonds, shall mean Financial Security Assurance Inc., a New York stock insurance company or any successor thereto or assignee thereof. "Bond Service Requirement" shall mean, for any Bond Year, the amount of principal of or Amortization Installments and interest due on the Bonds for such Bond Year. "Bond Year" shall mean the Fiscal Year of the Issuer. OR373052;6 3 "Bonds" shall mean the Special Assessment Revenue Bonds, Series 2001 (Tuscawilla Improvement Area) herein authorized to be issued herein. "City Attorney" shall mean the City Attorney of the Issuer. "City Manager" shall mean the City Manager of the Issuer. "Clerk" shall mean the City Clerk of the Issuer. "Construction Fund" shall mean the Construction Fund created and established pursuant to Section 16 of this Resolution. "Continuing Disclosure Certificate" shall mean that certain certificate related to the Bonds to be executed by the Issuer prior to the time the Issuer delivers the Bonds to the underwriter or underwriters, as it may be amended from time to time in accordance with the terms thereof, whereby the Issuer undertakes to comply with the secondary disclosure requirements of the Rule. "Delinquent Assessment Interest" shall mean the interest portion of the Assessments deposited with the Issuer after the date on which such interest portion of the Assessments has become due and payable, "Delinquent Assessment Principal" shall mean the principal portion of the Assessments deposited with the Issuer after the date on which such principal portion of the Assessments has become due and payable. "Finance Director" shall mean the Finance Director of the Issuer. "Fiscal Year" shall mean the period commencing on October 1 of each year and ending on the next succeeding September 30 or such other annual period as may be prescribed by law from time to time for the Issuer, "Half-Cent Sales Tax" shall mean the proceeds of the local government half-cent sales tax distributed to the City from the Local Government Half-Cent Sales Tax Clearing Trust Fund as defined and described in Part VI, Chapter 218, Florida Statutes, as amended. "Holder of Bonds" or "Bondholders" or any similar term shall mean any persons who shall be the registered owner of any outstanding Bonds. "Issuer" or "City" shall mean the City of Winter Springs, Florida. "Maximum Bond Service Requirement n shall mean, as of any particular date of calculation, the greatest amount of aggregate Bond Service Requirement for the then current or any future Bond Year, except that with respect to any Bonds for which Amortization Installments have been established, the amount of principal coming due on the final maturity date with respect to such 0R373052;6 4 Bonds shall be reduced by the aggregate principal amount of such Bonds that are to be redeemed from Amortization Installments which were to be made in prior Bond Years. "Outstanding" or "Bonds Outstanding" shall mean all Bonds which have been issued pursuant to this Resolution, except: (i) Bonds canceled after purchase in the open market or because of payment at or redemption prior to maturity; (ii) Bonds for the payment or redemption of which cash funds or Acquired Obligations or any combination thereof shall have been theretofore irrevocably set aside in a special account with an escrow agent (whether upon or prior to the maturity or redemption date of any such Bonds) in an amount which, together with earnings on such Acquired Obligations, will be sufficient to pay the principal of and interest on such Bonds at maturity or upon their earlier redemption; provided that, if such Bonds are to be redeemed before the maturity thereof, notice of such redemption shall have been given according to the requirements of this Resolution or irrevocable instructions directing the timely publication of such notice and directing the payment of the principal of and interest on all such Bonds at such redemption dates shall have been given; and (iii) Bonds which are deemed paid pursuant to this Resolution or in lieu of which other Bonds have been issued under Sections 11 and 13 hereof. "Paying Agent" shall mean any paying agent for Bonds appointed by or pursuant to a supplemental resolution and its successors or assigns, and any other Person which may at any time be substituted in its place pursuant to a supplemental resolution. "Permitted Investments" shall mean any of the following which shall be authorized from time to time by applicable laws of the State of Florida for deposit or purchase by the Issuer for the investment of its funds: 1. (a) Direct obligations (other than an obligation subject to variation in principal repayment) ofthe United States of America ("United States Treasury Obligations"), (b) obligations fully and unconditionally guaranteed as to timely payment of principal and interest by the United States of America, (c) obligations fully and unconditionally guaranteed as to timely payment of principal and interest by any agency or instrumentality of the United States of America, or (d) evidences of ownership of proportionate interests in future interest and principal payments on obligations described above held by a bank or trust company as custodian, under which the owner of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying government obligations are not available to any person claiming through the custodian or to whom the custodian may be obligated. 2, Federal Housing Administration debentures, OR373052;G 5 3. The following obligations of government-sponsored agencies: Federal Home Loan Mortgage Corporation (FHLMC) participation certificates (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts) and senior debt obligations Farm Credit Banks (formerly: Federal Land Banks, Federal Intermediate Credit Banks and Banks for Cooperatives) Consolidated system-wide bonds and notes Federal Home Loan Banks (FHL Banks) consolidated debt obligations Federal National Mortgage Association (FNMA) senior debt obligations and mortgage-backed securities (excluded are stripped mortgage securities which are purchased at prices exceeding their principal amounts) Student Loan Marketing Association (SLMA) senior debt obligations (excluded are securities that do not have a fixed par value and/or whose terms do not promise a fixed dollar amount at maturity or call date) Financing Corporation (FICO) debt obligations Resolution Funding Corporation (REFCORP) debt obligations 4, Unsecured certificates of deposit, time deposits, and bankers' acceptances (having maturities of not more than 30 days) of any bank the short-term obligations of which are rated" A- 1_ or better by S&P, 5, Deposits the aggregate amount of which are fully insured by the Federal Deposit Insurance Corporation (FDIC), in banks which have capital and surplus of at least $5 million. 6, Commercial paper (having original maturities of not more than 270 days) rated" A- I +" by S&P and "Prime-I" by Moody's. 7, Money market funds rated "AAm" or "AAm-G" by S&P, or better. 8, "State Obligations," which means: A, Direct general obligations of any state of the United States of American or any subdivision or agency thereof to which is pledged the full faith and credit of a state the unsecured general obligation debt of which is rated "A3" by Moody's and "A" by S&P, or better, or any obligation fully and unconditionally guaranteed by any state, subdivision or agency whose unsecured general obligation debt is so rated, OR373052;6 6 B. Direct general short-term obligations of any state agency or subdivision or agency thereof described in (A) above and rated "A-l +" by S&P and "MIG-l" by Moody's. C. Special Revenue Bonds (as defined in the United States Bankruptcy Code) of any state, state agency or subdivision described in (A) above and rated" AA" or better by S&P and "Aa" or better by Moody's, 9, Pre-refunded municipal obligations rated "AAA" by S&P and "Aaa" by Moody's meeting the following requirements (" Pre-refunded Obligations"): A, the municipal obligations are (1) not subject to redemption prior to maturity or (2) the trustee for the municipal obligations has been given irrevocable instructions concerning their call and redemption and the issuer of the municipal obligations has covenanted not to redeem such municipal obligations other than as set forth in such instructions; B, the municipal obligations are secured by cash or United States Treasury Obligations which may be applied only to payment of the principal of, interest and premium on such municipal obligations; C. the principal of an interest on the United states Treasury Obligations (plus any cash in the escrow) has been verified by the report of independent certified public accountants to be sufficient to pay in full all principal of, interest, and premium, if any, due and to become due on the municipal obligations ("Verification"); D, the cash or United States Treasury Obligations serving as security for the municipal obligations are held by an escrow agent or trustee in trust for owners of the municipal obligations; E, no substitution of a United States Treasury Obligation shall be permitted except with another United States Treasury Obligation and upon delivery of a new Verification; and F. the cash or United States Treasury Obligations are not available to satisfy any other claims, including those by or against the trustee or escrow agent. 10, Repurchase agreements: With (1) any domestic bank, or domestic branch of a foreign bank, the long term debt of which is rated at least "A" by S&P and Moody's; or (2) any broker-dealer with "retain customers" or a related affiliate thereof which broker-dealer has, or the parent company (which guarantees the provider) of which has, long-term debt rated at least "A" by S&P and Moody's, which broker- dealer falls under the jurisdiction of the Securities Investors Protection Corporation; or (3) any other entity rated" A" or better by S&P and Moody's and acceptable to the Insurer, provided that: OR373052;G 7 A, The market value of the collateral is maintained at levels and upon such conditions as would be acceptable to S&P and Moody's to maintain an "A" rating in an "A" rated structured financing (with a market value approach): B, The Paying Agent or a third party acting solely as agent therefor or for the Issuer (the "Holder of the Collateral") has possession of the collateral or the collateral has been transferred to the Holder of the collateral in accordance with applicable state and federal laws (other than by means of entries on the transferor's books); C. The repurchase agreement shall state and an opinion of counsel shall be rendered at that time such collateral is delivered that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this means the Holder of the Collateral is in possession); D. All other requirements of S&P in respect of repurchase agreements shall be met. E. The repurchase agreement shall provide that if during its term the provider; , s rating by either Moody's or S&P is withdrawn or suspended or falls below "A -" by S&P or "A3" by Moody's, as appropriate, the provider must, at the direction of the Issuer or the Paying Agent (who shall give such direction if so directed by the Insurer), within 10 days of receipt of such direction, repurchase all collateral and terminate the agreement, with no penalty or premium to the Issuer or Paying Agent. Notwithstanding the above, if a repurchase agreement has a term of270 days or less (with no evergreen provision), collateral levels need not be as specified in (A) above, so long as such collateral levels are 103 % or better and the provider is rated at least "A" by S&P and Moody's, respectively. 11. Investment agreements with a domestic or foreign bank or corporation (other than a life or property casualty insurance company) the long-term debt of which, or, in the case of a guaranteed corporation the long-term debt, or, in the case of a monoline financial guaranty insurance company, claims paying ability, of the guarantor is rated at least "AA" by SP an "Aa" by Moody's; provided that, by the terms of the investment agreement: A. interest payments are to be made to the Paying Agent at times and in amounts as necessary to pay debt service (or, if the investment agreement is for the construction fund, construction draws) on the Bonds; B. the invested funds are available for withdrawal without penalty or premium, at any time upon not more than seven days' prior notice; the Issuer and the Paying Agent hereby agree to give or cause to be given notice in accordance with the terms of the investment agreement so as to receive funds thereunder with no penalty or premium paid; OR373052;G 8 C. the investment agreement shall state that is the unconditional and general obligation of, and is not subordinated to any other obligation of, the provider thereof or, if the provider is a bank, the agreement or the opinion of counsel shall state that the obligations of the provider to make payments thereunder ranks pari passu with the obligations of the provider to its other depositors and its other unsecured and unsubordinated creditors; D, the Issuer or the Paying Agent receives the opinion of domestic counsel (which opinion shall be addressed to the Issuer and the Insurer) that such investment agreement is legal, valid, binding and enforceable upon the provider in accordance with its terms and of foreign counsel (if applicable) in form and substance acceptable, and addressed to, the Insurer; E. The investment agreement shall provide that if during its term (i) . the provider's rating by either S&P ro Moody's falls below "AA-" or "Aa3", respectively, the provider shall, at its option, withing 10 days of receipt of publication of such downgrade, either (i) collateralize the investment agreement by delivering or transferring in accordance with applicable state and federal laws (other than by means of entries on the provider's books) to the Issuer, the Paying Agent or a third party acting solely as agent therefor (the "Holder of the Collateral") collateral free and clear of any third-party liens or claims their market value of which collateral is maintained at levels and upon such conditions as would be acceptable to S& P and Moody's to maintain an "A" rating in an "A" rated structured financing (with a market value approach); or (ii) repay the principal of an accrued but unpaid interest on the investment; and (ii) the provider's rating by either S&P or Moody's is withdrawn or suspended or falls below "A -" or "A3", respectively, the provider must, at the direction of the Issuer or Paying Agent (who shall give such direction if so directed by the applicable Insurer), within 10 days of receipt of such direction, repay the principal of and accrued but unpaid interest on the investment, in either case with no penalty or premium to the Issuer or Paying Agent; and F. The investment agreement shall state and an opinion of counsel shall be rendered, in the event collateral is required to be pledged by the provider under the terms of the investment agreement, at the time such collateral is delivered, that the Holder of the Collateral has a perfected first priority security interest in the collateral, any substituted collateral and all proceeds thereof (in the case of bearer securities, this means the holder of the collateral is in possession); and G, The investment agreement must provide that if during its term (i) the provider shall default in its payment obligations, the provider's obligations under the investment agreement shall, at the direction of the Issuer or the Paying Agent (who shall give such direction if so directed by the Issuer), be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the Issuer or Paying Agent, as appropriate, and OR373052;6 9 (ii) the provider shall become insolvent, not pay its debts as they become due, be declared or petition to be declared bankrupt, etc. ("event of insolvency"), the provider's obligations shall automatically be accelerated and amounts invested and accrued but unpaid interest thereon shall be repaid to the Issuer or Paying Agent, as appropriate. 12. Units of Participation in the Local Government Surplus Funds Trust Fund established pursuant to Part IV, Chapter 218, Florida Statutes. "Person" shall mean an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or governmental entity. "Pledged Revenues" shall mean the Assessments, the first $160,000 0 f Half-Cent Sales Tax received by the City in each Fiscal Year of the City and until applied in accordance with the provisions of this Resolution, the proceeds of the Bonds and all moneys including investments, in the funds and accounts established hereunder, except the Rebate Fund. "Prepayment Principal" shall mean the excess amount of the principal portion of the Assessments received by the Issuer over the principal portion of the Assessments then due, but shall not include Delinquent Assessment Principal. "Project" shall mean those certain capital projects to be made within the Assessment Area, all or more particularly described in the plans and specifications on file or to be on file with the City as the same may be amended or supplemented from time to time. "Project Costs" shall mean all costs authorized to be paid from the Construction Fund pursuant to Section 18 hereof to the extent permitted under the laws of the State. It is intended that this definition be broadly construed to encompass all costs, expenses and liabilities of the Issuer related to the Project which on the date of this Resolution or in the future shall be permitted to be funded with the proceeds of the Bonds pursuant to the laws of the State. "Rebate Fund" shall mean the Rebate Fund created pursuant to Section 24 of this Resolution. "Redemption Price" shall mean with respect to any Bond or portion thereof, the principal amount or portion thereof, plus the applicable premium, if any, payable upon redemption thereof pursuant to such Bond or this Resolution. "Registrar" shall mean any registrar for the Bonds appointed hereby or pursuant to supplemental resolution and its successors and assigns, and any other Person which may at any time be substituted in its place pursuant to a supplemental resolution. "Reserve Fund" shall mean the Reserve Fund created and established pursuant to Section 16 of this Resolution, 0R373052;6 10 "Reserve Requirement" shall be the lesser of (i) the Maximum Bond Service Requirement, (ii) 125% of the Average Annual Bond Service Requirement or (iii) ten percent (10%) of the proceeds of the Bonds, "Resolution" shall mean this resolution as from time to time may be amended or supplemented, in accordance with the terms hereof. "Rule" shall mean Rule l5c2-12 of the United States Securities and Exchange Commission, as amended. "Serial Bonds" shall mean all of the Bonds other than Term Bonds, as shall be determined by supplemental resolution of the Issuer, "State" shall mean the State of Florida, "Surety Bond" shall mean the surety bond issued by the Bond Insurer guaranteeing certain payments into the Reserve Fund as provided therein and subject to the limitations set forth therein, "Term Bonds" shall mean the Bonds of a series, all of which shall be stated to mature on one date, as shall be determined by supplemental resolution of the Issuer, The terms "herein," "hereunder," "hereby," "hereto," "hereof' and any similar terms shall refer to this Resolution; the term heretofore shall mean before the date of adoption of this Resolution; and the term "hereafter" shall mean after the date of adoption of this Resolution. Words importing the masculine gender include every other gender , Words importing the singular number include the plural number, and vice versa, SECTION 3. FINDINGS. It is hereby ascertained, determined and declared that: (A) It is in the best interests of the Issuer and the residents thereof that the Issuer authorize the issuance of the Bonds for the purpose of designing, permitting, acquiring and constructing the Project. (B) The Issuer has legally imposed the Assessments. (C) The principal of and interest and redemption premium on the Bonds and all other payments hereunder will be secured solely by the Pledged Revenues. The Issuer shall never be required to use any ad valorem taxes for the payment of the Bonds, The Bonds shall not constitute a pledge of the faith and credit of the Issuer, nor shall the Bondholders or the Bond Insurer have any lien or encumbrance on the Project or upon any other property of the Issuer except the Pledged Revenues, (D) The Pledged Revenues have not been pledged or encumbered in any manner. OR373052;6 11 SECTION 4, AUTHORIZATION OF DESIGN, PERMITTING, ACQUISITION AND CONSTRUCTION OF THE PROJECT. There is hereby authorized the design, permitting, acquisition and construction of the Project. SECTION 5, THIS RESOLUTION TO CONSTITUTE CONTRACT. In consideration of the purchase and acceptance of any or all of the Bonds by those who shall hold the same from time to time, the provisions of this Resolution shall be deemed to be and shall constitute a contract between the Issuer and the Owners from time to time of the Bonds and shall be a part of any contract of bond insurance that pertains to the Bonds, The pledge made in this Resolution and the provisions, covenants and agreements herein set forth to be performed by or bn behalf of the Issuer shall be for the equal benefit, protection and security of the Owners of any and all of the Bonds and for the benefit, protection and security of any Bond Insurer insuring the Bonds. All of the Bonds, regardless of the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof except as expressly provided in or pursuant to this Resolution. SECTION 6. AUTHORIZATION OF BONDS. Subject and pursuant to the provisions hereof, obligations of the Issuer to be known as "Special Assessment Revenue Bonds, Series 2001 (Tuscawilla Improvement Area)," are authorized to be issued in the aggregate principal amount of not exceeding $2,500,000, SECTION 7. DESCRIPTION OF BONDS. The Bonds shall be issued in fully registered form; shall be numbered consecutively from one upward in order of Maturity preceded by the letter "R" or such other lettering as the Issuer shall approve; shall be in the denomination of $5,000 each, or integral multiples thereof; shall be dated, shall bear interest or yields at such rate or rates or yields not exceeding the maximum rate allowed by State law, the actual rate or rates or yields to be as set forth in the Bond Purchase Contract referred to in Section 33 hereof; such interest to be payable semiannually at such times and such Bonds shall mature annually on such date in such years and in such amounts and have such other terms all as set forth in the Bond Purchase Contract referred to in Section 33 hereof. Each Bond shall bear interest from the interest date next preceding the date on which it is authenticated, unless authenticated on an interest payment date, in which case it shall bear interest from such interest payment date, or, unless authenticated prior to the first interest payment date, iii which case it shall bear interest from its date; provided, however, that if at the time of authentication payment of any interest which is due and payable has not been made, such Bond shall bear interest from the date to which interest shall have been paid. The principal of, the interest and redemption premium, if any, on the Bonds shall be payable 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 interest on the Bonds shall be payable by the Paying Agent on each interest payment date to the person appearing on the registration books of the Issuer hereinafter provided for as the registered Owner thereof on OR373052;G 12 the 15th day of the calendar month immediately preceding the applicable interest payment date, by check or draft mailed to such registered Owner at his address as it appears on such registration books or by wire transfer to Owners of $1,000,000 or more in principal amount of the Bonds. 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, Notwithstanding any other provisions of this section, the Issuer may, at its option, prior to the date of issuance of the Bonds, elect to use an immobilization system or book-entry system with respect to issuance of such Bonds. Such election shall be conclusively evidenced by execution by the proper officers of the Issuer of Bonds reflecting use of a bond-entry system. As long as any Bonds are outstanding in book-entry form the provisions of this Resolution inconsistent with such system of book-entry registration shall not be applicable to such Bonds. SECTION 8. EXECUTION OF BONDS. The Bonds shall be signed by, or bear the facsimile signature of the Mayor or Deputy Mayor of the Issuer, and shall be attested by, or bear the facsimile signature of, the Clerk or any Deputy Clerk and a facsimile of the official seal of the Issuer shall be imprinted 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 facsimile shall nevertheless be valid and sufficient for all purposes the same as if he has remained in office until such delivery, Any Bond may bear the facsimile signature of or may be signed by such persons who, 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 officers, SECTION 9. AUTHENTIC A TION 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 Registrar, 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 certificate of authentication shall have been duly executed by the Registrar, and such certificate of the Registrar upon any such Bond shall be conclusive evidence that such Bond has been duly authenticated and delivered under this Resolution, The Registrar's certificate of authentication on any Bond shall be deemed to have been duly executed if signed by an authorized officer of the Registrar, 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, SECTION 10. EXCHANGE OF BONDS. Any Bonds, upon surrender thereof at the principal corporate trust office of the Registrar, together with an assignment duly executed by the Bondholder or his attorney or legal representative in such form as shall be satisfactory to the Registrar, 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. OR3730S2;(, 13 The Registrar shall make provision for the exchange of Bonds at the designated office of the Registrar. The Issuer and Registrar shall not be obligated to make any exchange of Bonds during the fifteen (15) days next preceding an interest payment date or in the case of any proposed redemption of Bonds during the fifteen (15) days next preceding the redemption date established for such Bonds, SECTION 11. NEGOTIABILITY, REGISTRATION AND TRANSFER OF BONDS. The Registrar 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 and only upon surrender thereof to the Registrar together with an assignment duly executed by the Owner or his attorney or legal representative in such form as shall be satisfactory to the Registrar. Upon any such registration of transfer, the Issuer shall execute and the Registrar 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. The Issuer and Registrar shall not be obligated to make any transfer of Bonds during the fifteen (15) days next preceding an interest payment date or in the case of any proposed redemption of Bonds during the fifteen (15) days next preceding the redemption date established for such Bonds. In all cases in which Bonds shall be exchanged, the Issuer shall execute and the Registrar shall authenticate and deliver, at the earliest practicable time, a new Bond or Bonds in accordance with the provisions of this Resolution. All Bonds surrendered in any such exchange or registration of transfer shall forthwith be canceled by the Registrar. The Issuer or the Registrar may make a charge for every such exchange or registration 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 transfe~ of Bonds under the provisions of this Resolution, 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 Registrar shall authenticate and deliver, a new Bond oflike 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 Registrar proof of his ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer and the Registrar may prescribe and paying such expenses OR373052;6 14 as the Issuer and the Registrar 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 substitute 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 the part of the Issuer whether or not the lost, stolen or destroyed Bonds be at any time found by anyone, and such duplicate Bonds shall be entitled to equal and proportionate benefits 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 such times and in such manner as shall be set forth in the Bond Purchase Contract referred to in Section 33 hereof. Notice of such redemption shall, at least thirty (30) days prior to the redemption date, be filed with the Registrar, and mailed, first class mail, postage prepaid, to all Owners of Bonds to be redeemed at their addresses as they appear on the registration books hereinbefore provided for, but failure to mail such notice to one or more Owners of Bonds shall not affect the validity of the proceedings 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 to be redeemed. Any notice of optional redemption, other than with respect to an advance refunding, shall be circulated only if sufficient funds have been deposited in the Bond Service Fund to pay the redemption price of the Bonds to be redeemed. Official notice of redemption having been given as aforesaid, the Bonds or portions of Bonds to be redeemed shall, on the redemption date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the Issuer shall default in the payment of the Redemption Price) such Bonds or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption in accordance with said notice, such Bonds shall be paid by the Registrar at the Redemption Price, Installments of interest due on or prior to the redemption date shall be payable as herein provided for payment of interest. Upon surrender for any partial redemption of any Bond, there shall be prepared for the Owner a new Bond or Bonds of the same maturity in the amount of the unpaid principal of such partially redeemed Bond. All Bonds which have been redeemed shall be canceled and destroyed by the Registrar and shall not be reissued. In addition to the foregoing notice, further notice shall be given by the Issuer as set out below, but no defect in said further notice nor any failure to give all or any portion of such further notice shall in any manner defeat the effectiveness of a call for redemption if notice thereof is given as above prescribed, OR373052;u IS (A) Each further notice of redemption given hereunder shall contain the information required above for an official notice of redemption plus (i) the CUSIP numbers of all Bonds being redeemed; (ii) the date of issue of the Bonds as originally issued; (iii) the rate of interest borne by each Bond being redeemed: (iv) the maturity date of each Bond being redeemed; and (v) any other descriptive information needed to identify accurately the Bonds being redeemed, (B) Each further notice of redemption shall be sent at least 35 days before the redemption date by registered or certified mail or overnight delivery service to all registered securities depositories then in the business of holding substantial amounts of obligations of types similar to the type of which the Bonds consist and to one or more national information services that disseminates notices of redemption of obligations such as the Bonds. SECTION 15, FORM OF BONDS. The text of the Bonds, together with the certificate of authentication to be endorsed therein, shall be in substantially the following form, with such omissions, insertions and variations as maybe necessary, desirable, authorized or permitted by this Resolution, or as may be necessary to comply with applicable laws, rules and regulations of the United States and of the State in effect upon the issuance thereof. OR373052;G 16 [FORM OF BOND] No. R- $ UNITED STATES OF AMERICA STATE OF FLORIDA COUNTY OF SEMINOLE CITY OF WINTER SPRINGS SPECIAL ASSESSMENT REVENUE BONDS, SERIES 2001 (TUSCA WILLA IMPROVEMENT AREA) MATURITY DATE: INTEREST RATE: DATED DATE: ,2001 CUSIP: Registered Owner: Principal Amount: KNOW ALL MEN BY THESE PRESENTS that the City of Winter Springs, Florida (hereinafter called the "Issuer) for value received, hereby promises to pay to the order of the Registered Owner identified above or registered assigns, as herein provided, on the Maturity Date identified above, upon the presentation and surrender hereof at the principal corporate trust office of , Florida, solely from the revenues hereinafter mentioned, the Principal Amount identified above 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 wire transfer or check or draft transmitted to the Registered Owner at his address as it appears on the Bond registration books of the Issuer as it appears on the 15th day of the calendar month preceding the applicable interest payment date, interest on said Principal Amount at the Interest Rate per annum identified above on each April 1 and October 1 commencing October 1, 2001 from the interest payment date next preceding the date of registration and authentication of this Bond, unless this Bond is registered 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 1, 2001, in which event this Bond shall bear interest from 2001. The Bonds of this issue (shall not be) (shall be) subject to redemption prior to their maturity at the option of the Issuer, (Insert Optional or Mandatory Redemption Provisions) Notice of such redemption shall be given in the manner required by the Resolution described below, OR373052;G 17 This Bond is one of an authorized issue of Bonds in the aggregate principal amount of $ of like date, tenor and effect, except as to number, principal amount, maturity, and interest rate, issued to acquire, construct and erect certain capital projects within the Tuscawilla Improvement Area (as described in Resolution No, 99-884 of the Issuer)located within the jurisdiction of the Issuer, all in full compliance with the Constitution and Statutes of the State of Florida, including particularly Chapter 166, Part 11, Florida Statutes, the Charter of the Issuer, and Resolution No. _ duly adopted by the Issuer on , 2001 (hereinafter collectively called the II Resolution ") and is subject to all the terms and conditions of such Resolution, All capitalized undefined terms used herein shall have the meaning set forth in the Resolution, This Bond and the interest hereon are payable solely from and secured by a lien upon and a pledge of the Pledged Revenues (as defined in the Resolution), all in the manner and to the extent provided in the Resolution. This Bond does not constitute a general indebtedness of the Issuer 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 Bondowner shall never have the right to require or compel the exercise of the ad valorem taxing power of the Issuer or taxation of any real or personal property therein for the payment of the principal of and interest on this Bond or the making of any bond service fund, reserve or other payments provided for in the Resolution. It is further agreed between the Issuer and the Owner of this Bond that this Bond and the indebtedness evidenced hereby shall not constitute a lien or on any property of or in the Issuer, but shall constitute a lien only on the Pledged Revenues all in the manner provided in the Resolution. Neither the members of the City Commission of the Issuer nor any person executing this bond shall be liable personally hereon or be subject liability or accountability by reason of the issuance hereof. It is certified that this Bond is authorized by and is issued In conformity with the requirements of the Constitution and Statutes of the State of Florida, This Bond is and has all the qualities and incidents of a negotiable instrument under the laws of the State of Florida but may be transferred by the Bondowner hereof in person or by his attorney or legal representative at the principal corporate trust office of the Registrar 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 Resolution until it shall have been authenticated by the execution by the Registrar of the certificate of authentication endorsed hereon, OR373052;G 18 IN WITNESS WHEREOF, the City of Winter Springs, Florida, has issued this Bond and has caused the same to be signed by its Mayor, and countersigned and attested to by its Clerk (the signatures of the Mayor, and the Clerk being authorized to be facsimiles of such officers' signatures), and its seal or facsimile thereof to be affixed, unpressed, imprinted, lithographed or reproduced hereon, all as of the _ day of , 2001, (SEAL) ATTESTED AND COUNTERSIGNED: Clerk 0R373052;6 CITY OF WINTER SPRINGS, FLORIDA Mayor 19 CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds issued under the provisions of the within mentioned Resolution, , Registrar, as Date of Authentication: Authenticating Agent By: Authorized Officer OR373052;G 20 ASSIGNMENT AND TRANSFER For value received the undersigned hereby sells, assigns and transfers unto (Please insert Social Security or other identifying number of transferee) 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 by (member firm of the New York Stock Exchange or a commercial bank or a trust company. ) NOTICE: No transfer will be registered and no new Bonds will be issued in the name of the Transferee, unless the signature to this assignment corresponds with the name as it appears upon the face of the within 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. By: Title: (END OF FORM OF BOND] OR373052;6 21 SECTION 16, CREATION OF FUNDS. There are hereby created and established for the Bonds the following funds and accounts, which funds and accounts shall be trust funds held by the City for the purposes herein provided and used only in the manner herein provided: (A) The "City of Winter Springs Special Assessment Revenue Fund" (hereinafter sometimes called the "Revenue Fund ") to be held by the Issuer and to the credit of which deposits shall be made as required by Section 20(A) hereof. (B) The" City of Winter Springs Special Assessment Bond Service Fund" (hereinafter sometimes called the "Bond Service Fund") to be held by the Issuer and to the credit of which deposits shall be made as required by Section 20(B)(1) hereof. In such fund there shall be maintained the following accounts: the Principal Account, the Interest Account, the Redemption Account and the Prepayment Account. (C) The "City of Winter Springs Special Assessment Reserve Fund" (hereinafter sometimes called the "Reserve Fund") to be held by the Issuer and to the credit of which deposits shall be made as required by Section 20(B)(1) hereof. (D) The "City of Winter Springs Special Assessment Construction Fund" (hereinafter sometimes called the "Construction Fund") to be held by the Issuer and to the credit of which deposits shall be made as required by Section 17 hereof. (E) The City of Winter Springs Half-Cent Sales Tax Fund (the "Sales Tax Fund") to be held by the Issuer and to the credit of which deposit shall be made as referenced by Section 20 (B) (5) hereof. SECTION 17, APPLICATION OF BOND PROCEEDS. The proceeds, including accrued interest and premium, if any, received from the sale 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 and shall be used only for the purpose of paying interest becoming due on the Bonds. (B) The Issuer shall purchase from the Bond Insurer the Surety Bond in an amount equal to the Reserve Requirement for the Bonds which shall be deposited in the Reserve Fund. (C) The balance of the proceeds of the Bonds shall be deposited into the Construction Fund hereby created and used solely for the purpose of paying Costs of the Project. Other than costs of issuing and delivering the Bonds which shall be paid at the direction of the City Manager of the Issuer or his designee, the Issuer shall make disbursements or payments from the Construction Fund to pay the Costs of the Project only upon the filing in the office of the Clerk of certificates signed by the Finance Director and the Project engineer or other qualified consultant, stating with respect to each disbursement or payment to be made: (1) the item number of the payment, (2) the name and address of the Person to whom payment is due, (3) the amount OR373052;(i 22 to be paid, and (4) that each obligation, item or cost or expense mentioned therein has been properly incurred, is in payment of a part of the Cost of the Project and is a proper charge against the Construction Fund and has not been the basis of any previous disbursement or payment, or that each obligation, item of cost or expense mentioned therein is a reimbursement of a part of the Cost of the Project which has been paid by the Issuer or will be paid by the Issuer substantially contemporaneously with such disbursement from the Construction Fund, and is a proper charge against the Construction Fund, has not been theretofore reimbursed to the Issuer or otherwise been the basis of any previous disbursement or payment and the Issuer is entitled to reimbursement thereof. The date of completion of the Project shall be determined by the Project engineer or other qualified consultant who shall certify such fact in writing to the governing body of the Issuer. Promptly after the date of the completion of the Project, and after paying or making provisions for the payment of all unpaid items of the Cost of the Project, the Issuer shall deposit in the following order of priority any balance of moneys remaining in the Construction Fund in (1) another construction fund or account established in connection with projects for which there are insufficient moneys present to pay the costs of such project, (2) the Reserve Fund created for the benefit of the Bonds, to the extent of a deficiency therein and (3) such other fund or account of the Issuer as shall be determined by the governing body, provided the Issuer has received an opinion of Bond Counsel to the effect that such transfer shall not adversely affect the exclusion of interest on the Bonds from gross income for federal income tax purposes, SECTION 18. DISBURSEMENTS FROM CONSTRUCTION FUND. Moneys on deposit from time to time in the Construction Fund shall be used to payor reimburse the following Project Costs: (A) Costs incurred directly or indirectly for or in connection with the Project including, but not limited to, those for preliminary planning and studies, architectural, legal, financial, engineering and supervisory services, labor, services, materials, equipment, acquisitions, land, rights-of-way, improvements and installation; (B) Premiums attributable to all insurance required to be taken out and maintained during the period of construction with respect to the Project, the premium on each surety bond, if any, required with respect to work on such facilities, and taxes, assessments and other charges hereof that may become payable during the period of construction with respect to such Project; (C) Costs incurred directly or indirectly in seeking to enforce any remedy against a contractor or subcontractor in respect of any default under. a contract relating to the Project or costs incurred directly or indirectly in defending any claim by a contractor or subcontractor with respect to the Project; (D) Financial, legal, accounting, appraisals, title evidence and printing and engraving fees, charges and expenses, and all other such fees, charges and expenses incurred in connection with the authorization, sale, issuance and delivery of the Bonds; OR373052;6 23 (E) Interest funded from Bond proceeds, if any, for a reasonable period of time, which shall be deposited in the Construction Fund and shall be used to pay interest on the Bonds during such period of time; (F) Any other incidental and necessary costs including without limitation any expenses, fees and charges relating to the acquisition, construction or installation of the Project, including the cost of temporary employees of the Issuer retained to carry out duties in connection with the acquisition, construction or erection of a Project; (G) Costs incurred directly or indirectly in placing the Project in operation in order that completion of such Project may occur; (H) Any other costs authorized pursuant to a supplemental resolution of the Issuer and permitted under the laws of the State; and (I) Reimbursements to the Issuer in accordance with applicable law for any of the above items theretofore paid by or on behalf of the Issuer, SECTION 19. 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 Pledged Revenues as herein provided, No Holder or Holders 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, or to compel the Issuer to pay such principal and interest from any other funds of the Issuer. SECTION 20. COVENANTS OF THE ISSUER. For so long as any of the principal of and interest on any of the Bonds shall be outstanding and unpaid or until the Issuer has made provision for payment of principal, interest and redemption premiums, if any, with respect to the Bonds, as provided herein, the Issuer covenants with the Holders of any and all Bonds as follows: (A) REVENUE FUND, All Assessments (other than Delinquent Assessment Principal, Delinquent Assessment Interest and Prepayment Principal) shall upon receipt thereof by the Issuer be deposited in the Revenue Fund, All deposits into such Revenue Fund shall be deemed to be held in trust for the purposes herein provided and used only for the purposes and in the maIll1er herein provided. (B) DISPOSITION OF REVENUES, All revenues in the Revenue Fund shall be disposed of at least two (2) business days prior to each April 1 and October 1 commencing October 1, 2001 (each being an "Interest Payment Date") only in the following maIll1er and the following order or priority: OR373052;6 24 (1) The Issuer shall first deposit into the Bond Service Fund and credit to the following accounts, in the following order (except that payments in the Principal Account and the Redemption Account shall be on a parity with each other), the following identified sums: (a) Interest Account: A portion of the Assessments which shall represent interest on the Assessments as will be sufficient to pay all interest coming due on all outstanding Bonds on the next Interest Payment Date, together with any fees and charges of the Paying Agent and Registrar therefor. Moneys in the Interest Account may be used only for the purposes set forth in this paragraph (a). (b) Principal Account: A portion of the Assessments which shall be allocable to the principal of the Assessments as will be sufficient to pay the principal amount of the Outstanding Bonds which will mature and become due on the next maturity date, Moneys in the Principal Account may be used only for the purposes set forth in this paragraph, (c) Redemption Account: Such sum as will be sufficient to pay any Amortization Installment established for the mandatory redemption of Outstanding Bonds on the next Amortization Installment date. The moneys in the Redemption Account shall be used solely for the purchase or redemption of the Term Bonds payable therefrom. The Issuer may at any time purchase any of said Term Bonds at prices not greater than the then redemption price of said Term Bonds, Ifthe Term Bonds are not then redeemable prior to maturity, the Issuer may purchase said Term Bonds at prices not greater than the redemption price of such Term Bonds on the next ensuing redemption date. If Term Bonds are so purchased by the Issuer, the Issuer shall credit the amount of such purchased Term Bonds against any current Amortization Installment to be paid by the Issuer, If the Issuer shall purchase or call for redemption in any year Term Bonds in excess of the Amortization Installment requirement for such year, such excess of Term Bonds so purchased or redeemed shall be credited in such manner and at such times as the Issuer shall determine. Moneys in the Redemption Account in the Bond Service Fund may be used only for the purposes set forth in this paragraph (c). (2) The Issuer shall next deposit from moneys remaining in the Revenue Fund an amount required by the provisions hereof to be deposited into the Reserve Fund, Any withdrawals from the Reserve Fund shall be subsequently restored from the first moneys available in the Revenue Fund, after all current applications and allocations to the Bond Service Fund, including all deficiencies for prior payments have been made in full. Notwithstanding the foregoing, in case of withdrawal from the Reserve Fund, in no event shall the Issuer be required to deposit into the Reserve Fund an amount greater than that amount necessary to ensure that the difference between the Reserve Requirement and the amounts on deposit in the Reserve Fund on the date of calculation shall be restored not later than twelve (12) months after the date of such deficiency (assuming equal monthly payments into such account for such twelve (12) month period), The Issuer may provide that the difference between the amounts on deposit in the Reserve Fund and the Reserve Requirement shall be an amount covered by obtaining a debt service reserve municipal bond insurance policy issued by a reputable and recognized municipal bond insurer, by a letter of credit rated in one of the two highest categories by a nationally recognized rating OR373052;G 2S agency, by a surety bond acceptable to the Bond Insurer, or any combination thereof. Amounts in the Reserve Fund shall be used only for the purpose of the payment of Amortization Installments, principal of, and interest on the Outstanding Bonds when the moneys in the Bond Service Fund are insufficient therefor, and for no other purpose, In connection with the issuance of the Surety Bond for the Bonds (the "Reserve Policy"), the Issuer agrees to repay any draws under such Reserve Policy and pay all related reasonable expenses incurred by the Bond Insurer, Interest shall accrue and be payable on such draws and expenses from the date of payment by the Bond Insurer at the Late Payment Rate, the lesser of (a) the greater of (i) the per annum rate of interest, publicly announced from time to time by The Chase Manhattan Bank at its principal office in the City of New York, as its prime or base lending rate ("Prime Rate") (any change in such Prime Rate to be effective on the date such change is announced by The Chase Manhattan Bank) plus 3 %, and (ii) the then applicable highest rate of interest on the Bonds and (b) the maximum rate permissible under applicable usury or similar laws limiting interest rates (the "Late Payment Rate"), The Late Payment Rate shall be computed on the basis of the actual number of days elapsed over a year of 365 days, In the event The Chase Manhattan Bank ceases to announce its Prime Rate publicly, Prime Rate shall be the publicly announced prime or base lending rate of such national bank as the Bond Insurer shall specify, Repayment of draws and payment of expenses and accrued interest thereon at the Late Payment Rate (collectively, "Policy Costs ") shall commence in the first month following each draw, and each such monthly payment shall be in an amount at least equal to 1/12 of the aggregate of Policy Costs related to such draw, Cash and investments in the Reserve Account established for the Bonds shall be transferred to the Bond Service Fund for payment of debt service on such Bonds before any drawing may be made on the Reserve Policy or any other credit facility credited to the Reserve Fund for the Bonds in lieu of cash ("Credit Facility"). Payment of any Policy Costs shall be made prior to replenishment of any such cash amounts, Draws on all Credit Facilities (including the Reserve Policy) on which there is available coverage shall be made on a pro-rata basis (calculated by reference to the coverage then available thereunder) after applying all available cash and investments in the Reserve Fund. Payment of Policy Costs and reimbursement of amounts with respect to other Credit Facilities shall be made on a pro-rata basis prior to replenishment of any cash drawn from the Reserve Fund. The Issuer's obligation to pay Policy Costs shall survive payment in full of the Bonds. Amounts in respect of Policy Costs paid to the Bond Insurer shall be credited first to interest due, then to expenses due and then to principal due. As and to the extent payments are made to the Bond Insurer on account of principal due, the coverage under the Reserve Policy will be increased by a like amount, subject to the terms of the Reserve Policy, The Paying Agent shall ascertain the necessity for a claim upon the Reserve Policy and provide notice to the Bond Insurer in accordance with the terms of the Reserve Policy at least five business days prior to each date upon which interest or principal is due on the Bonds. The Paying OR373052;(, 26 Agent shall also give notice to the Bond Insurer of any failure of the Issuer to make timely payment in full of deposits to the Bond Service Fund within two business days of the date due. If the Issuer shall fail to pay any Policy Costs, the Bond Insurer shall be entitled to exercise any and all legal and equitable remedies available to it, including those provided under the Resolution other than (i) acceleration of the maturity of the Bonds or (ii) remedies which would adversely affect owners of the Bonds. In order to secure the Issuer's payment obligations with respect to the Policy Costs the Issuer pledges to the Insurer for the Bonds the Pledged Funds (subordinate only to the lien thereon in favor of the owners of the Bonds). In the event of the refunding of any Bonds, the Issuer may withdraw from the Reserve Fund, all or any portion of the amounts accumulated therein with respect to the Bonds being refunded and deposit such amounts as required by the resolution authorizing the refunding of such Bonds; provided that such withdrawal shall not be made unless (a) immediately thereafter the Bonds being refunded shall be deemed to have been paid pursuant to the provisions hereof and (b) the amount remaining in the Reserve Fund after giving effect to the issuance of such refunding obligations and the disposition of the proceeds thereof shall not be less than the Reserve Requirement for any Bonds then Outstanding. (3) (a) Prepayment Principal as received shall be deposited into the Prepayment Account and applied to the extraordinary mandatory redemption of Bonds on the next interest payment date as provided for in the Bonds. (b) Delinquent Assessment Principal shall first be applied to restore the amount of any withdrawal, from the Reserve Fund to pay the principal of Bonds to the extent that less than the Reserve Requirement is on deposit in the Reserve Fund, and the balance, if any, shall be deposited into the Principal Account. (c) Delinquent Assessment Interest shall first be applied to restore the amount of any withdrawal from the Reserve Fund to pay the interest on Bonds to the extent that less than the Reserve Requirement is on deposit in such Reserve Fund, and the balance, if any, deposited into the Interest Account. (4) 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 specified unless all current payments, including 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. (5) The Issuer shall deposit the first One Hundred and Sixty Thousand Dollars ($160,000,00) of Half-Cent Sales Tax received by the Issuer in each Fiscal Year into the Sales Tax Fund promptly upon receipt thereof. The moneys in the Sales Tax Fund shall be deposited or OR373052;6 27 credited on or before one (1) business day prior to each Interest Payment Date in the following manner and in the following order of priority: (a) On any such date in which there shall not be sufficient revenues available in the Revenue Fund to make any deposits as required in (1) and (2) above, the Issuer shall transfer from the Sales Tax Fund the required amounts needed to make the above stated payments, including any deficiencies for prior payments, (b) Thereafter, on or after May 1 of each year, but only after the Issuer has determined that there are sufficient amounts on deposit in the Revenue Fund to make the deposits required in (1) and (2) above on the following October 1, including any deficiencies for prior payments, any moneys remaining in said Sales Tax Fund may be transferred to any other Issuer fund on account and used by the Issuer for any lawful purpose, (6) The Bond Service Fund (including the accounts therein), the Reserve Fund, the Revenue Fund, the Sales Tax Fund and any other special funds herein established and created shall be deemed to be held in trust for the purposes provided herein for such funds. The moneys in all such funds shall be continuously secured in the same manner as state and municipal deposits are authorized to be secured by the laws of the State of Florida, Moneys in any fund or account created hereunder (with the exception of the Reserve Fund) shall be invested and reinvested in Permitted Investments which mature not later than the dates on which the moneys on deposit therein will be needed for the purpose of such fund. Moneys in the Reserve Fund may be invested and reinvested in Permitted Investments maturing not later than five (5) years from the date of initial deposit to the Reserve Fund, Such Permitted Investments shall be valued by the Paying Agent as frequently as deemed necessary by the Bond Insurer, but not less often than annually, at the market value thereof, exclusive of accrued interest. Deficiencies in any fund or account created hereunder resulting from a decline in market value shall be restored no later than the succeeding valuation date. All income on such investments, except as otherwise provided, 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 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, credit may 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 may be deposited in a single bank account, provided 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, but rather is intended solely to constitute OR373052;G 28 an earmarking of certain revenues and assets for certain purposes and to establish certain priorities for application of such revenues and assets as herein provided. (C) ENFORCEMENT OF PAYMENT OF ASSESSMENTS, The Issuer will assess, levy, collect or cause to be collected and enforce the payment of Assessments in the manner prescribed by all resolutions, ordinances or laws thereunto appertaining at times and in amounts as shall be necessary in order to pay, when due, the principal of and interest on the Bonds. Upon the due date of the Assessments, the Issuer shall diligently proceed to collect the same and shall exercise all legally available remedies to enforce such collections now or hereafter available under State law, (D) DELINQUENT ASSESSMENTS. If the owner of any lot or parcel of land shall be delinquent in the payment of any Assessment, then such Assessment shall be enforced in accordance with applicable law, including but not limited to the sale of tax certificates and tax deeds as regards such delinquent Assessment. (E) OTHER OBLlGA TIONS PAYABLE FROM PLEDGED REVENUES. The Issuer will not issue or incur any obligations payable from the Pledged Revenues nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or other charge upon such Pledged Revenues except for fees, commissions, costs, and other charges payable to the property appraiser or to the tax collector pursuant to Florida law which may be a charge against the Assessments, (F) RE-ASSESSMENTS, If any Assessment shall be either in whole or in part annulled, vacated or set aside by the judgment of any court, or the Issuer shall be satisfied that any such Assessment is so irregular or defective that it cannot be enforced or collected, or if the Issuer shall have omitted to make such Assessment when it might have done so, the Issuer shall either: (i) take all necessary steps to cause a new Assessment to be made for the whole or any part of such improvement or against any property benefited by such improvement; or (ii) in its sole discretion, make up the amount of such Assessment from legally available moneys, which moneys shall be deposited into the Revenue Fund, In case any such subsequent Assessment shall also be annulled, the Issuer shall obtain and make other Assessments until a valid Assessment shall be made. (G) ANNUAL AUDIT, The Issuer shall, immediately after the close of each Fiscal Year, cause the financial statements of the Issuer to be properly audited by a recognized independent certified public accountant or recognized independent firm of certified public accountants, and shall require such accountants to complete their report on the annual financial statements in accordance with applicable law. The annual financial statement shall be prepared in conformity with generally accepted accounting principles consistently applied, A copy of the audited financial statements for each Fiscal Year shall be furnished to the Bond Insurer and to each Holder that provides a written request. The Issuer shall be permitted to make a reasonable charge for furnishing such audited financial statements to each Holder. OR373052;6 29 (H) BOOKS AND RECORDS, The Issuer shall keep books, records and accounts of the Pledged Revenues, and the Holders of any Bonds Outstanding or the duly authorized representatives thereof shall have the right at all reasonable times to inspect all books, records and accounts of the Issuer relating thereto, (I) NO IMPAIRMENT, The Issuer will not enter into any contract or contracts, nor take any action, the results of which might impair the right of the Holders hereunder, (1) COLLECTION OF SALES TAX REVENUES, The Issuer covenants to do all things necessary on its part to maintain its eligibility to participate in the distribution of funds from the Local Government Half Cent Sales Tax Clearing Trust Fund as described in Part VI, of Chapter 218, Florida Statutes, as amended, The Issuer will at all times comply with all of the requirements and conditions of Chapter 218, Part VI, Florida Statutes, as amended, and take every necessary action to remain qualified to receive distribution of the Half Cent Sales Tax; and the Issuer will not take any action which will jeopardize its eligibility for receipt of such funds which may adversely affect its undertakings as provided in this Resolution. The Issuer will not take any action or enter into any agreement that shall result in reducing the level of Half Cent Sales Tax distributed to the Issuer from that prevailing at the time the Issuer takes such action or enters into such agreement. SECTION 21. DEFAULTS; EVENTS OF DEFAULT AND REMEDIES. Except as provided below, if any of the following events occur it is hereby defined as and declared to be and to constitute an "Event of Default" : (A) Default in the due and punctual payment of any interest on the Bonds; (B) Default in the due and punctual payment of the prineipal of and premium, if any, on any Bond, at the stated maturity thereof, or upon proceedings for redemption thereof; (C) Default in the performance or observance of any other of the covenants, agreements or conditions on the part of the Issuer contained in this Resolution or in the Bonds and the continuance thereof for a period of thirty (30) days after written notice to the Issuer given by the Holders of not less than twenty-five percent (25 %) of aggregate principal amount of Bonds then Outstanding (provided, however, that with respect to any obligation, covenant, agreement or condition which requires performance by a date certain, if the Issuer performs such obligation, covenant, agreement or condition within thirty (30) days of written notice as provided above, the default shall be deemed to be cured); (D) Failure by the Issuer promptly to remove any execution, garnishment or attachment of such consequence as will materially impair its ability to carry out its obligations hereunder; or (E) Any act of bankruptcy or the rearrangement, adjustment or readjustment of the obligations of the Issuer under the provisions of any bankruptcy or moratorium laws or similar laws relating to or affecting creditors' rights, OR373052;6 30 The term "default" shall mean default by the Issuer in the performance or observance of any of the covenants, agreements or conditions on its part contained in this Resolution, any supplemental resolution or in the Bonds, exclusive of any period of grace required to constitute a default or an "Event of Default" as hereinabove provided, For purposes of Section 21 (A) and (B) hereof, no effect shall be given to any payments made under any Bond Insurance Policy. Any Holder of Bonds issued under the provisions hereof or any trustee acting for the Holders 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 State or federal law , or granted and contained herein, and may enforce and compel the performance of all duties required herein or by any applicable law to be performed by the Issuer or by any officer thereof. The foregoing notwithstanding: (ii) No remedy conferred upon or reserved to the Bondholders is intended to be exclusive of any other remedy, but each remedy shall be cumulative and shall be in addition to any other remedy given to the Bondholders hereunder. (iii) No delay or omission to exercise any right or power accruing upon any default or Event of Default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein, and every such right and power may be exercised as often as may be deemed expedient. (iv) No waiver of any default or Event of Default hereunder by the Bondholders shall extend to or shall affect any subsequent default or Event of Default or shall impair any rights or remedies consequent thereon. (v) Acceleration of the payment of principal of and interest on the Bonds shall not be a remedy hereunder in the case of an Event of Default. Notwithstanding any provision of this Resolution to the contrary, for all purposes of this Section 21, except the giving of notice of any Event of Default to the Holder of the Bonds, the Bond Insurer shall be deemed to be the sole Holder of the Bonds it has insured, On the occurrence of an Event of Default, to the extent such rights may then lawfully be waived, neither the Issuer nor anyone claiming through or under it, shall set up, claim or seek to take advantage of any stay, extension or redemption laws now or hereafter in force, in order to prevent or hinder the enforcement of this Resolution, and the Issuer, for itself and all who may claim through or under it, hereby waives, to the extent it may lawfully do so, the benefit of all such laws and all right of redemption to which it may be entitled. OR373052;6 31 Within 30 days of knowledge thereof, both the Issuer and the Paying Agent shall provide notice to the Bond Insurer of the occurrence of any Event of Default. The Bond Insurer shall be included as a party in interest and as a party entitled to (i) notify the Issuer or any Paying Agent of the occurrence of an Event of Default and (ii) request the Issuer or any Paying Agent to intervene in judicial proceedings that affect the Bonds or the security therefor, The Issuer and any Paying Agent are required to accept notice of default from the Bond Insurer. Anything in this Resolution to the contrary notwithstanding, upon the occurrence and continuance of an Event of Default, the Bond Insurer, provided the Bond Insurance Policy is still in full force and effect, shall be entitled to control and direct the enforcement of all rights and remedies granted to the Bondholders under this Resolution and the Bond Insurer shall also be entitled to approve all waivers of events of default. The maturity of the Bonds shall not be accelerated without the prior written consent of the Bond Issuer. SECTION 22. AMENDING AND SUPPLEMENTING OF RESOLUTION WITHOUT CONSENT OF HOLDERS OF BONDS. The Issuer, from. time to time and at any time and without the consent or concurrence of any Holder of any Bonds but with the prior consent of the Bond Insurer, may adopt a resolution amendatory hereof or supplemental hereto, if the provisions of such supplemental resolution shall not adversely affect the rights of the Holders of the Bonds then Outstanding, for anyone or more of the following purposes: (A) To make any changes or corrections in this Resolution as to which the Issuer shall have been advised by counsel that are required for the purpose of curing or correcting any ambiguity or defective or inconsistent provisions or omission or mistake or manifest error contained in this Resolution, or to insert in this Resolution such provisions clarifying matters or questions arising under this Resolution as are necessary or desirable; (B) To add additional covenants and agreements of the Issuer for the purpose of further securing the payments of the Bonds; (C) To surrender any right, power or privilege reserved to or conferred upon the Issuer by the terms of this Resolution; (D) To confirm as further assurance any covenant created or to be created by the provisions of this Resolution; (E) To grant to or confer upon the Holders any additional right, remedies, powers, authority or security that lawfully may be granted to or conferred upon them; (F) To assure compliance with federal "arbitrage" and other applicable tax provisions in effect from time to time; or OR373052;G 32 (G) To modify any of the provisions of this Resolution in any other aspects provided that such modifications shall not be effective until after the Bonds Outstanding at the time such supplemental resolution is adopted shall cease to be Outstanding, or until the holders thereof consent thereto pursuant to Section 23 hereof, and any Bonds issued subsequent to any such modification shall contain a specific reference to the modifications contained in such supplemental resolution, Except for supplemental resolutions providing for the issuance of Bonds pursuant hereto, the Issuer shall not adopt any supplemental resolution authorized by the foregoing provisions of this Section unless in the opinion of Bond Counsel the adoption of such supplemental resolution is permitted by the foregoing provisions of this Section, SECTION 23, AMENDMENT OF RESOLUTION WITH CONSENT OF HOLDERS OF BONDS. Except as provided in Section 22 hereof, no material modification or amendment of this Resolution or of any resolution supplemental hereto shall be made without the consent in writing of the Holders of fifty-one percent or more in the principal amount of the Bonds so affected and then Outstanding. For purposes of this Section, to the extent any Bonds are insured by a Bond Insurance Policy or are secured by a letter of credit, and such Bonds are then rated in as high a rating category as the rating category in which such Bonds were rated at the time of initial issuance and delivery thereof, then the consent of the issuer of such Bond Insurance Policy or the issuer of such letter of credit shall be deemed to constitute the consent of the Holder of such Bonds. No modification or amendment shall permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon or in the amount of the principal obligation thereof or affecting the promise of the Issuer to pay the principal of and interest on the Bonds as the same shall become due or reduce the percentage of the Holders of the Bonds required to consent to any material modification or amendment hereof without the consent of the Holder or Holders of all such Bonds. For purposes of the immediately preceding sentence, the issuer of a Bond Insurance Policy or a letter of credit shall not consent on behalf of the Holders of the Bonds, No amendment or supplement pursuant to this Section 23 shall be made without the consent of the Bond Insurer. SECTION 24. FEDERAL INCOME TAX COVENANTS. (A) The Issuer covenants with the Holders ofthe Bonds that it shall not use the proceeds of such Bonds in any manner which would cause the interest on such Bonds to be or become includable in the gross income of the Holder thereof for federal income tax purposes. (B) The Issuer covenants with the Holders of the Bonds that neither the Issuer nor any Person under its control or direction will make any use of the proceeds of such Bonds (or amounts deemed to be proceeds under the Code) in any manner which would cause such Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code, and neither the Issuer nor any other Person shall do any act or fail to do any act which would cause the interest on such Bonds to become includable in the gross income of the Holder thereof for federal income tax purposes, OR373052;6 33 (C) The Issuer shall payor cause to be paid to the United States Government any amounts required by Section 148(1) of the Code and the regulations thereunder (the "Regulations"). In order to insure compliance with the rebate provisions of Section 148(f) of the Code with respect to the Bonds, the Issuer hereby creates the "City of Winter Springs Special Assessment Rebate Fund" (hereinafter sometimes called the "Rebate Fund ") to be held by the Issuer, The Rebate Fund need not be maintained so long as the Issuer timely satisfies its obligation to pay any rebatable earnings to the United States Treasury; however, the Issuer may, as an administrative convenience, maintain and deposit funds in the Rebate Fund from time to time. Any moneys held in the Rebate Fund shall not be available to pay debt service on the Bonds, Moneys in the Rebate Fund (including earnings and deposits therein) shall be held for future payment to the United States Government as required by the treasury regulations and as set forth in instructions of Bond Counsel delivered to the Issuer upon issuance of such Bonds, SECTION 25, DEFEASANCE, The covenants and obligations of the Issuer shall be defeased and discharged under terms of this Resolution as follows: (A) If the Issuer shall payor cause to be paid, or there shall otherwise be paid, to the Holders of all Bonds the principal, redemption premium, if any, and interest due or to become due thereon, at the times and in the manner stipulated herein and in the Bonds, and all amounts owed the Bond Insurer for policy costs have been paid in full, then the covenants, agreements and other obligations of the Issuer to the Bondholders, shall thereupon cease, terminate and become void and be discharged and satisfied, If the Issuer shall payor cause to be paid, or there shall otherwise be paid, to the Holders of any Outstanding Bonds the principal, redemption premium, if any, and interest due or to become due thereon, at the times and in the manner stipulated herein, such Bonds shall cease to be entitled to any benefit under this Resolution, and all covenants, agreements and obligations of the Issuer to the Holders of such Bonds shall thereupon cease, terminate and become void and be discharged and satisfied. (B) The Bonds, redemption premium, if any, and interest due or to become due for the payment or redemption of which moneys shall have been set aside and shall be held in trust (through deposit by the Issuer of funds for such payment or redemption or otherwise) at the maturity or redemption date thereof shall be deemed to have been paid within the meaning and with the effect expressed in paragraph (A) of this Section 25, Any Outstanding Bonds shall prior to the maturity or redemption date thereof be deemed to have been paid within the meaning and with the effect expressed in paragraph (A) of this Section if (i) in case of said Bonds are to be redeemed on any date prior to their maturity, the Issuer shall have given to the escrow agent instructions accepted in writing by the escrow agent to notify Holders of Outstanding Bonds in the manner required herein of the redemption of such Bonds on said date and (ii) there shall have been deposited with the escrow agent either moneys in an amount which shall be sufficient, or Acquired Obligations (including any Acquired Obligations issued or held in book-entry form on the books of the Department of the Treasury of the United States) the principal of and the interest on which when due will provide moneys which, together with the moneys, if any, deposited with the escrow agent at the same time, shall be sufficient, to pay when due the principal of, premium, if any, and OR373052;6 34 interest due and to become due on said Bonds on or prior to the redemption date or maturity date thereof, as the case may be, Notwithstanding anything herein to the contrary, in the event that the principal and/or interest due on the Bonds shall be paid by the Bond Insurer, the Bonds shall remain Outstanding for all purposes, not be defeased or otherwise satisfied and not be considered paid by the Issuer, and the assignment and pledge of the Pledged Revenues and all covenants, agreements and other obligations of the Issuer to the registered owners shall continue to exist and shall run to the benefit of the Bond Insurer, and the Bond Insurer shall be subrogated to the rights of such registered owners, SECTION 26, CONTINUING DISCLOSURE, The Issuer hereby covenants and agrees that, in order to provide for compliance with the secondary market disclosure requirements of the Rule, that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate to be executed by the Issuer prior to the time the Issuer delivers the Bonds to the participating underwriter or underwriters, as it may be amended from time to time in accordance with the terms thereof. Notwithstanding any other provision of this Resolution, failure of the Issuer to comply with such Continuing Disclosure Certificate shall not be considered an Event of Default hereunder, However, the Continuing Disclosure Certificate shall be enforceable by the Bondowners in the event that the Issuer fails to cure a breach thereunder within a reasonable time after written notice from a Bondowner to the Issuer that a breach exists, Any rights of the Bondowners to enforce the provisions of the covenant shall be on behalf of all Bondowners and shall be limited to a right to obtain specific performance of the Issuer's obligations thereunder. SECTION 27, BOND ANTICIPATION NOTES. The Issuer may issue notes in anticipation of the issuance of Bonds which shall have such terms and details and be secured in such manner, not inconsistent with this Resolution, as shall be provided by resolution of the Issuer. SECTION 28, BOND INSURANCE, Purchase of the Bond Insurance Policy from the Bond Insurer to insure the holder of any Bond, the scheduled payment of principal and interest on behalf of the Issuer is hereby authorized and payment for such insurance is hereby authorized from Bond proceeds or from other City moneys, In accordance with the Commitment for Municipal Bond Insurance attached hereto as an exhibit, a statement of insurance is hereby authorized to be printed on or attached to the Bonds for the benefit and information of the Bondholders, In accordance with the commitment of the Bond Insurer attached hereto as an exhibit, the purchase of a surety bond for deposit to the Reserve Fund is hereby authorized, and payment of the premium for such surety bond from proceeds of the Bonds or other legally available moneys of the City is hereby authorized, SECTION 29, PRELIMINARY OFFICIAL STATEMENT. The Issuer is hereby authorized to distribute a preliminary official statement for the Bonds and delegates to the City Manager the authority to deem such Preliminary Official Statement "final" except for "permitted omissions" within the contemplation of the Rule. The proper officers of the City are hereby authorized to execute on behalf of the Issuer the Official Statement relating to the Bonds in substantially the form and content as the Preliminary Official Statement, with such additions, OR373052;6 35 deletions, and changes thereto, including such additions, deletions and other changes as may be necessitated by this Resolution and the approved Bond Purchase Contract as such officers may approve (such approval to be conclusively evidenced by their execution of said Official Statement, and to deliver such Official Statement to the underwriters), SECTION 30, PAYING AGENT AND REGISTRAR, First Union National Bank, is hereby appointed to serve as Registrar and Paying Agent for the Bonds, SECTION 31. BANK QUALIFIED. The Issuer designates the Bonds 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 Issuer does not reasonably anticipate that the Issuer, any subordinate entities of the Issuer, and issuers of debt that issue "on behalf" of the Issuer, will during either calendar year 2001 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 32. OTHER ACTIONS, The Mayor, the Deputy Mayor/Commissioner, the City Manager, the City Attorney, the City Clerk including any Deputy City Clerk and the Finance Director (collectively the "Issuer Officers"), Akerman, Senterfitt & Eidson, P,A. as Bond Counsel, and Public Financial Management, Inc" as the Issuer's Financial Advisor, are hereby authorized and directed to take all actions necessary or desirable in connection with the issuance and delivery of the Bonds and the consummation of all transactions in connection therewith. The Issuer Officers are hereby authorized and directed to execute all necessary or desirable certificates, documents, papers, and agreements for the undertaking and fulfillment of all transactions referred to in or contemplated by the Resolution, the Official Statement, this Resolution, and the Bond Purchase Contract. SECTION 33, NEGOTIATED SALE; DELEGATIONS OF AUTHORITY REGARDING SALE OF BONDS; BOND PURCHASE CONTACT, The complex character of the security for the Bonds requires lengthy and detailed structuring with could be unreasonably restricted by the lack of flexibility at public sale. Based upon all available information and advice from the staff of the Issuer, a negotiated sale of the Bonds to the Underwriters listed in the Bond PUrchase Contract (the "Bond Purchase Contract") attached hereto will result in the most favorable bond financing plan and is in the best interest of the Issuer, The City Manager of the Issuer is hereby authorized and directed to execute and deliver to the underwriters for the Bonds such Bond Purchase Contact provided that the true interest cost for the Bonds is less than six percent (6%), the final maturity date of the Bonds is not later than October 1, 2030, and the Maximum Bond Service Requirement is less than $160,000, Compliance with the provisions of the prior sentence shall be conclusively determined upon receipt by the City Manager of a letter of Public Financial Management, Inc" financial advisor to the Issuer that such provisions have been complied with. The Bond Purchase Contract shall be in substantially the form attached hereto with such changes thereto as may be approved in accordance with the above paragraph, The negotiated sale of the Bonds to the underwriters set forth in the Bond Purchase Contract is hereby approved, The City Manager is hereby authorized to execute the Bond Purchase Contract on behalf of the Issuer, upon satisfaction of the above conditions, OR373052;6 36 SECTION 34, SEVERABILITY, If anyone or more of the covenants, 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 or shall in any manner be held to adversely affect the validity of the Bonds, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions of this Resolution or of the Bonds issued hereunder. SECTION 35. GENERAL AUTHORITY. The members of the City Commission of the Issuer and the Issuer's officers, attorneys and other agents and employees are hereby authorized to perform all acts and things required of them by this Resolution or desirable or consistent with the requirements hereof for the full, punctual and complete performance of all of the terms, covenants and agreements contained in the Bonds and this Resolution, and they are hereby authorized to execute and deliver all documents which shall be required by bond counselor the initial purchasers of the Bonds to effectuate the sale of the Bonds to said initial purchasers. SECTION 36, INTENT TO REIMBURSE, The Issuer hereby expresses its present intention to be reimbursed from proceeds of a future tax-exempt financing for capital expenditures to be paid by the Issuer in connection with the subsequent issuance of the Bonds for the purpose of financing the Cost of the Project. Pending reimbursement, the Issuer expects to use funds on deposit in the Issuer General Fund or other appropriate fund or account to pay such costs including but not limited to capital expenditures and other costs associated with the issuance of the Bonds. It is reasonably expected that the amount of Bonds to be issued by the City with respect to the Project will not exceed $2,500,000. This Resolution is intended to constitute a "declaration of official intent" within the meaning of Section 1.150-2 of the Income Tax Regulations with respect to the Bonds to be issued to finance the cost of the Project. SECTION 37, MUNICIPAL BOND INSURANCE. The following provisions shall be applicable to the Series 2001 Bonds and the Bond Insurance Policy therefor, which provision shall govern notwithstanding anything to the contrary herein: (A) If, on the third business day prior to the related scheduled interest payment date or principal payment date or the date to which a Series 2001 Bond maturity has been accelerated ("Payment Date") there is not on deposit with the Paying Agent, after making all transfers and deposits required under the Resolution, moneys sufficient to pay the principal of and interest on the Series 2001 Bonds due on such Payment Date, the Paying Agent shall give notice to The Bond Insurer and to its designated agent (if any) (the "Insurer's Fiscal Agent") by telephone or telecopy of the amount of such deficiency by 12:00 noon, New York City time, on such business day. If, on the second business day prior to the related Payment Date, there continues to be a deficiency in the amount available to pay the principal of and interest on the Series 2001 Bonds due on such Payment Date, the Paying Agent shall make a claim under the Bond Insurance Policy and give notice to the Bond Insurer and the Bond Insurer's Fiscal Agent (if any) by telephone of the amount OR373052;G 37 of such deficiency, and the allocation of such deficiency between the amount required to pay interest on the Series 2001 Bonds and the amount required to pay principal of the Series 2001 Bonds, confirmed in writing to The Bond Insurer and The Bond Insurer's Fiscal Agent by 12:00 noon, New York City time, on such second business day by filling in the form of Notice of Claim and Certificate delivered with the Bond Insurance Policy, In the event the claim to be made is for a mandatory sinking fund redemption installment, upon receipt of the moneys due, the Paying Agent shall authenticate and deliver to affected Series 2001 Bondholders who surrender their Series 2001 Bonds a new Series 2001 Bond or Series 2001 Bonds in an aggregate principal amount equal to the unredeemed portion of the Series 2001 Bond surrendered, The Paying Agent shall designate any portion of payment of principal on Series 2001 Bonds paid by the Bond Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other advancement of maturity, on its books as a reduction in the principal amount of Series 2001 Bonds registered to the then current Bondholder, whether DTC or its nominee or otherwise, and shall issue a replacement Series 2001 Bond to the Bond Insurer, registered in the name of Financial Security Assurance Inc" in a principal amount equal to the amount of principal so paid (without regard to authorized denominations); provided that the Paying Agent's failure to so designate any payment or issue any replacement Series 2001 Bond shall have no effect on the amount of principal or interest payable by the Issuer on any Series 2001 Bond or the subrogation rights of The Bond Insurer. The Paying Agent shall keep a complete and accurate record of all funds deposited by The Bond Insurer into the Policy Payments Account (hereinafter described) and the allocation of such funds to payment of interest on and principal paid in respect of any Series 2001 Bond. The Bond Insurer shall have the right to inspect such records at reasonable times upon reasonable notice to the Paying Agent. Upon payment of a claim under the Bond Insurance Policy the Paying Agent shall establish a separate special purpose trust account for the benefit of Series 2001 Bondholders referred to herein as the "Policy Payments Account" and over which the Paying Agent shall have exclusive control and sole right of withdrawal. The Paying Agent shall receive any amount paid under the Bond Insurance Policy in trust on behalf of Series 2001 Bondholders and shall deposit any such amount in the Policy Payments Account and distribute such amount only for purposes of making the payments for which a claim was made. Such amounts shall be disbursed by the Paying Agent to Series 2001 Bondholders in the same manner as principal and interest payments are to be made with respect to the Series 2001 Bonds under the sections hereof regarding payment of Series 2001 Bonds, It shall not be necessary for such payments to be made by checks or wire transfers separate from the check or wire transfer used to pay debt service with other funds available to make such payments, Funds held in the Policy Payments Account shall not be invested by the Paying Agent and may not be applied to satisfy any costs, expenses or liabilities of the Paying Agent and funds remaining in the Policy Payments Account following a Payment Date shall be promptly remitted to the Bond Insurer, OR373052;G 38 (B) The Bond Insurer shall, to the extent it makes any payment of principal of or interest on the Series 2001 Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Bond Insurance Policy, (C) The Issuer shall payor reimburse the Bond Insurer any and all charges, fees, costs and expenses which the Bond Insurer may reasonably payor incur in connection with (i) the administration, enforcement, defense or preservation of any rights or security in this Resolution or the Insurance Agreement delivered in regard to the Series 2001 Bonds ("Related Documents"), (ii) the pursuit of any remedies under this Resolution or any other Related Document or otherwise afforded by law or equity, (iii) any amendment, waiver or other action with respect to, or related to, this Resolution or any other Related Document whether or not executed or completed, (iv) the violation by the Issuer of any law, rule or regulation, or any judgment, order or decree applicable to it or (v) any litigation or other dispute in connection with this Resolution or any other Related Document or the transactions contemplated thereby, other than amounts resulting from the failure of the Bond Insurer to honor its obligations under its Bond Insurance Policy. The Bond Insurer reserves the right to charge a reasonable fee as a condition to executing any amendment, waiver or consent proposed in respect of this Resolution or any other Related Document. (D) Payments required to be made to the Bond Insurer shall be paid (i) prior to an Event of Default, to the extent not paid from the Bond Service Fund, after required deposits to the Reserve Fund and (ii) after an Event of Default, with respect to amounts other than principal and interest on the Series 2001 Bonds on the same priority as payments for expenses. Such obligations to the Bond Insurer shall survive discharge or termination of the Related Documents, (E) The Bond Insurer shall be entitled to pay principal or interest on the Series 2001 Bonds that shall become Due for Payment but shall be unpaid by reason of Nonpayment by the Issuer (as such terms are defined in the Bond Insurance Policy) and any amounts due on the Series 2001 Bonds as a result of acceleration of the maturity thereof in accordance with this Resolution, whether or not the Bond Insurer has received a Notice of Nonpayment (as such terms are defined in the Bond Insurance Policy) or a claim upon the Bond Insurance Policy. (F) The notice address of the Bond Insurer is: Financial Security Assurance Inc" 350 Park A venue, New York, New York 10022-6022, Attention: Managing Director - Surveillance; Re: Policy No. Telephone: (212) 826-0100; Telecopier: (212) 339-3529, In each case in which notice or other communication refers to an Event of Default, then a copy of such notice or other communication shall also be sent to the attention of General Counsel and shall be marked to indicate "URGENT MATERIAL ENCLOSED," (G) The Bond Insurer shall be provided with the following information: (i) Annual audited financial statements within 180 days after the end of the Issuer's fiscal year and the Issuer's annual budget within 30 days after the approval thereof; OR373052;6 39 (ii) Notice of any draw upon the Reserve Fund within two Business Days after knowledge thereof other than (i) withdrawals of amounts in excess of the Reserve Requirement and (ii) withdrawals in connection with a refunding of Bonds; (iii) Notice of any default known to the Paying Agent within five Business Days after knowledge thereof; (iv) Prior notice of the advance refunding or redemption of any of the Bonds, including the principal amount, maturities and CUSIP numbers thereof; (v) Notice of the resignation or removal of the Paying Agent and Registrar and the appointment of, and acceptance of duties by, any successor thereto; (vi) Notice of the commencement of any proceeding by or against the Issuer commenced under the United States Bankruptcy Code or any other applicable bankruptcy, insolvency, receivership, rehabilitation or similar law (an "Insolvency Proceeding"); (vii) Notice of the making of any claim in connection with any Insolvency Proceeding seeking the avoidance as a preferential transfer of any payment of principal of, or interest on, the Bonds; (viii) A full original transcript of all proceedings relating to the execution of any amendment or supplement to the Related Documents; and (ix) All reports, notices and correspondence to be delivered under the terms of the Related Documents, (H) No contract shall be entered into nor any action taken by which the rights of the Bond Insurer or security for or sources payment of the Series 2001 Bonds may be impaired or prejudiced except upon obtaining the prior written consent of the Bond Insurer, (I) Copies of any modification or amendment to the Resolution or any other Related Document shall be sent to Standard & Poor's Ratings Services and Moody's Investors Service, Inc. At least 10 days prior to the effective date thereof. (1) The rights granted to the Bond Insurer under the Resolution or any other Related Document to request, consent to or direct any action are rights granted to the Bond Insurer in consideration of its issuance of the Bond Insurance Policy. Any exercise by the Bond Insurer of such rights is merely an exercise of the Bond Insurer's contractual rights and shall not be construed or deemed to be taken for the benefit or on behalf of the Bondholders nor does such action evidence any position of the Bond Insurer, positive or negative, as to whether Bondholder consent is required in addition to consent of the Bond Insurer. OR373052;6 40 SECTION 38, NO PERSONAL LIABILITY. Neither the members of the City Commission of the Issuer nor any person executing the Bonds shall be personally liable therefor or be subject to any personal liability or accountability by reason of the issuance thereof. SECTION 39, REPEAL OF INCONSISTENT INSTRUMENTS. Any Resolutions, or parts thereof, in conflict herewith are hereby repealed to the extent of such conflict. SECTION 40, HEADINGS NOT PART HEREOF. The headings preceding the several articles and sections hereof shall be solely for convenience of reference and shall not constitute a part of this Resolution or affect its meaning, construction or effect. SECTION 41. APPROVAL OF PRIOR ACTIONS. All actions take to date by the City Commission in furtherance of the issuance of the Bonds and the levying of the assessments are hereby approved, confirmed and ratified, SECTION 42. EFFECTIVE DATE, The provisions of this Resolution shall take effect immediately upon its passage, Adopted the 9th day of April, 2001. CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA (SEAL) ATTEST: City Clerk Approved as to form: City Attorney 41