Resolution 2003-334
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RESOLUTION NO. 03- 334
RESOLUTION OF THE BOARD OF COUNTY
COMMISSIONERS OF COLLIER COUNTY, FLORIDA,
SUPPLEMENTING RESOLUTION NO. 85-107 ENTITLED
"A RESOLUTION AUTHORIZING THE ISSUANCE OF NOT
EXCEEDING $29,625,000 CAPITAL IMPROVEMENT
REVENUE REFUNDING BONDS, SERIES 1985 OF THE
COUNTY TO FINANCE THE COST OF REFUNDING
CERTAIN OUTSTANDING OBLIGATIONS OF THE
COUNTY; PROVIDING FOR THE RIGHTS OF THE
HOLDERS OF SUCH BONDS; PROVIDING FOR THE
PAYMENT THEREOF; MAKING CERTAIN OTHER
COVENANTS AND AGREEMENTS IN CONNECTION
WITH THE ISSUANCE OF SUCH BONDS; AND
PROVIDING AN EFFECTIVE DA TE"; AUTHORIZING THE
REFUNDING OF CERT AIN OF THE COUNTY'S
OUTSTANDING CAPITAL IMPROVEMENT REVENUE
REFUNDING BONDS, SERIES 1992; AUTHORIZING THE
FINANCING OF VARIOUS CAPITAL IMPROVEMENTS
WITHIN THE COUNTY; AUTHORIZING THE ISSUANCE
OF NOT EXCEEDING $51,000,000 IN AGGREGATE
PRINCIPAL AMOUNT OF COLLIER COUNTY, FLORIDA
CAPITAL IMPROVEMENT AND REFUNDING REVENUE
BONDS, SERIES 2003 IN ORDER TO REFUND SUCH
SERIES 1992 BONDS AND FINANCE SUCH CAPITAL
IMPROVEMENTS; MAKING CERTAIN COVENANTS AND
AGREEMENTS WITH RESPECT TO SAID BONDS;
AUTHORIZING THE A WARDING OF SAID BONDS
PURSUANT TO A PUBLIC BID; DELEGATING CERTAIN
AUTHORITY TO THE CHAIRMAN FOR THE A WARD OF
THE BONDS ANDTHE APPROVALOFTHETERMS AND
DETAILS OF SAID BONDS; APPOINTING THE PAYING
AGENT AND REGISTRAR FOR SAID BONDS;
AUTHORIZING THE DISTRIBUTION OF A PRELIMINARY
OFFICIAL STATEMENT AND THE EXECUTION AND
DELIVERY OF AN OFFICIAL STATEMENT WITH
RESPECT THERETO; AUTHORIZING THE EXECUTION
AND DELIVERY OF AN ESCROW DEPOSIT AGREEMENT
AND THE APPOINTMENT OF AN ESCROW AGENT
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THERETO; ESTABLISHING A BOOK-ENTRY SYSTEM OF
REGISTRATION FOR THE BONDS; AUTHORIZING
MUNICIPAL BOND INSURANCE FOR THE BONDS;
AUTHORIZING A RESERVE ACCOUNT SURETY BOND
WITH RESPECT TO THE BONDS; AUTHORIZING THE
EXECUTION AND DELIVERY OF A CONTINUING
DISCLOSURE CERTIFICATE; AND PROVIDING AN
EFFECTIVE DATE.
BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF
COLLIER COUNTY, FLORIDA:
SECTION 1.
FINDINGS. It is hereby found and determined that:
(A) On April 30, 1985, the Board of County Commissioners (the "Board") of
Collier County, Florida (the "Issuer") duly adopted Resolution No. 85-107, as amended and
supplemented (collectively the "Resolution"), the title of which resolution is quoted in the
title of this Supplemental Resolution, for the purposes described therein, authorizing, among
other things, the issuance of$29,625,000 Capital Improvement Revenue Refunding Bonds,
Series 1985 (the "Series 1985 Bonds"), which Series 1985 Bonds were issued for the
principal purpose of refunding the Issuer's outstanding Capital Improvement Revenue Bonds,
1982. The Series 1985 Bonds are no longer outstanding under the Resolution.
(B) Pursuant to the Resolution the Issuer has heretofore issued its $8,225,000
Capital Improvement Revenue Refunding Bonds, Series 1992 (the "Series 1992 Bonds") for
the principal purpose of refunding the County's outstanding Capital Improvement Revenue
Bonds, Series 1988.
(C) Pursuant to the Resolution the Issuer has heretofore issued its $30,415,000
Capital Improvement Revenue Refunding Bonds, Series 1994 (the "Series 1994 Bonds") for
the principal purpose of refunding the County's outstanding Capital Improvement Revenue
Bonds, Series 1986.
(D) Pursuant to the Resolution, the Issuer has heretofore issued its $47,430,000
Capital Improvement Revenue Bonds, Series 2002 (the "Series 2002 Bonds") for the
principal purpose of financing various capital improvements and refunding certain
indebtedness of the Issuer.
(E) The Issuer hereby determines that certain capital improvements should be
acquired, constructed and equipped within the Issuer in order to improve the health, safety
and welfare of the inhabitants within the Issuer's geographic boundaries. Such capital
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improvements are generally described in Exhibit A hereto and are more particularly
described in the records, plans and specifications on file with the Issuer (the "Project"). Such
Exhibit A may be amended or supplemented from time to time by the Board without the
consent of any Bondholder (as defined in the Resolution) or Insurer (as defined in the
Resolution).
(F) The Issuer hereby deems it in its best interest to refund, on a current basis, that
portion ofthe outstanding Series 1992 Bonds which mature on and after October 1,2004 (the
"Refunded Bonds") in order to achieve debt service savings. The Series 1992 Bonds
maturing on October 1, 2003 shall be paid at their scheduled maturity prior to the issuance of
the hereinafter defined Series 2003 Bonds.
(G) The Resolution provides for the issuance of Additional Parity Bonds on a parity
with the then outstanding Series 1994 Bonds and Series 2002 Bonds (collectively, the "Parity
Bonds") for the purpose of financing the acquisition, construction and equipping of the
Project and refunding, on a current basis, the Refunded Bonds, upon meeting the
requirements set forth therein.
(H) There is hereby authorized the financing and/or reimbursing the costs of the
acquisition, construction and equipping of the Project and the refunding of the Refunded
Bonds, all in the manner as provided by this Supplemental Resolution.
(I) The Issuer deems it to be in its best interest to issue its Collier County, Florida
Capital Improvement and Refunding Revenue Bonds, Series 2003 (the "Series 2003 Bonds")
for the principal purpose of financing and/or reimbursing the costs of the acquisition,
construction and equipping of the Project and refunding, on a current basis, the Refunded
Bonds. The Series 2003 Bonds shall be issued on parity in all respects with the Parity Bonds
pursuant to the terms of the Resolution.
(1) A portion of the proceeds derived from the sale of the Series 2003 Bonds,
together with other legally available moneys of the Issuer, shall be deposited to a special
escrow deposit trust fund to purchase certain direct non-callable U.S. Treasury obligations
(the "Escrow Securities"), which shall be sufficient, together with the investment earnings
therefrom and a cash deposit, if any, to pay the principal of, premium, if any, and interest on
the Refunded Bonds as the same become due and payable or are redeemed prior to maturity,
all as provided herein and in the hereinafter described Escrow Deposit Agreement.
(K) In accordance with Section 218.385, Florida Statutes, and pursuant to this
Resolution, the Series 2003 Bonds shall be advertised for competitive bids pursuant to the
Official Notice of Sale, the form of which is attached hereto as Exhibit C (the "Official
Notice of Sale").
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(L) Pursuant to the Official Notice of Sale, any competitive bids received in
accordance with the Official Notice of Sale on or prior to 12:00 p.m., Eastern time, on
October 7,2003 or such other date or time as is determined by the Chairman in accordance
with the terms and provisions of the Official Notice of Sale, shall be publicly opened and
announced.
(M) Due to the present volatility and uncertainty of the market for tax-exempt
obligations such as the Series 2003 Bonds, it is desirable for the Issuer to be able to advertise
and award the Series 2003 Bonds at the most advantageous time and date which shall be
determined by the Chairman; and, accordingly, the Issuer hereby determines to delegate the
advertising and awarding of the Series 2003 Bonds to the Chairman within the parameters
described herein.
(N) It is necessary and appropriate that the Board determine certain parameters for
the terms and details of the Series 2003 Bonds and to delegate certain authority to the
Chairman for the award of the Series 2003 Bonds and the approval ofthe terms ofthe Series
2003 Bonds in accordance with the provisions hereof, of the Resolution and of the Official
Notice of Sale.
(0) In the event Bond Counsel to the Issuer shall determine that the Series 2003
Bonds have not been awarded competitively in accordance with the provisions of Section
218.385, Florida Statutes, the Board shall adopt such resolutions and make such findings as
shall be necessary to authorize and ratify a negotiated sale of the Series 2003 Bonds in
accordance with said Section 218.385.
(P) The Issuer hereby certifies that it is not in default in performing any of the
covenants and obligations assumed under the Resolution and all of the covenants contained
in the Resolution shall apply to the Series 2003 Bonds.
(Q) The report required by Section 19(1)( I) of the Resolution is set forth as Exhibit
B hereto and the Board hereby accepts such report. In connection therewith, the actual debt
service for the Series 2003 Bonds shall be determined in connection with the competitive sale
of such Bonds within the parameters set forth herein.
(R) The Project is ofthe nature and type that is beneficial to, or available to, all of
the citizens of the Issuer.
(S) The Resolution provides that the Series 2003 Bonds shall mature on such dates
and in such amounts, shall bear such rates of interest. shall be payable in such places and
shall be subject to such redemption provisions as shall be determined by Supplemental
Resolution adopted by the Issuer; and it is now appropriate that the Issuer set forth the
parameters and mechanism to determine such terms and details.
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(1') The Series 2003 Bonds shall not constitute a general obligation or a pledge of
the faith, credit or taxing power of the Issuer, the State of Florida, or any political subdivision
thereof, within the meaning of any constitutional or statutory provisions. Neither the Issuer,
the State of Florida, nor any political subdivision thereof shall be obligated (i) to exercise its
ad valorem taxing power in any fonn on any real Of personal property of or in the Issuer to
pay the principal of the Series 2003 Bonds, the interest thereon, or other costs incidental
thereto, or (ii) to pay the same from any other funds of the Issuer except from the Pledged
Revenues, in the manner provided in the Resolution.
SECTION 2. DEFINITIONS. When used in this Supplemental Resolution,
the terms defined in the Resolution shall have the meanings therein stated, except as such
definitions may be hereinafter amended or defined.
SECTION 3. AUTHORITY FOR THIS SUPPLEMENT AL
RESO L UTI 0 N. This S upp lemental Resolution is adopted pursuant to the provisions of the
Act and the Resolution.
SECTION 4. AUTHORIZATION OF THE FINANCING OF THE
PROJECT AND THE REFUNDING OF THE REFUNDED BONDS. The Issuer hereby
authorizes the financing and/or reimbursing of all or a portion of the Cost of the Project
subject in all respects to the award of the Series 2003 Bonds in accordance with this
Supplemental Resolution and the Official Notice of Sale. The Issuer hereby authorizes the
refunding, on a current basis, of the Refunded Bonds, in accordance with the tenns of the
Resolution and the Escrow Deposit Agreement, subject in all respects to the award of the
Series 2003 Bonds in accordance with this Supplemental Resolution and the Official Notice
of Sale.
SECTION 5. DESCRIPTION OF THE SERIES 2003 BONDS. The Issuer
hereby authorizes the issuance of a Series of Bonds in the aggregate principal amount of not
exceeding $51,000,000 to be known as the "Collier County, Florida Capital Improvement and
Refunding Revenue Bonds, Series 2003" (or such other series designation as the Chairman
may detenninc), for the principal purposes of financing and/or reimbursing all or a portion of
the costs of the acquisition, construction and equipping of the Project and refunding, on a
current basis, the Refunded Bonds. The aggregate principal amount of the Series 2003
Bonds to be issued pursuant to the Resolution shall be determined by the Chairman provided
such aggregate principal amount does not exceed $51,000,000. The Series 2003 Bonds shall
be dated as of October I, 2003 or such other date as the Chairman may determine, shall be
issued in the foml of fully registered Bonds in the denomination of $5,000 or any integral
multiple thereof, shall be numbered consccutively from one upward in order of maturity
preceded by the letter "R", shall bear interest from the dated date determined therefor,
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payable semi-annually, on April I and October 1 of each year (the "Interest Dates"),
commencing on April I, 2004, or such other date as may be determined by the Chairman.
Interest on the Series 2003 Bonds shall be payable by check or draft of Fifth Third
Bank, Cincinnati, Ohio, as Paying Agent, made payable and mailed to the Holder in whose
name such Bond shall be registered at the close of business on the date which shall be the
fifteenth day (whether or not a business day) of the calendar month next preceding the
applicable Interest Date, or, at the request of such Holder, by bank wire transfer to the
account of such Holder. Principal of the Series 2003 Bonds is payable to the Holder upon
presentation, when due, at the designated corporate trust office of The Fifth Third Bank,
Cincinnati, Ohio, as Paying Agent. The principal of, redemption premium, if any, and
interest on the Series 2003 Bonds are payable in lawful money of the United States of
America.
The Series 2003 Bonds shall bear interest at such rates and prices or yields, shall
mature on October 1 of each of the years and in the principal amounts corresponding to such
years, and shall have such redemption provisions as determined by the Chairman subject to
the conditions set forth in Sections 5, 6 and 7 hereof and the provisions ofthe Official Notice
of Sale. The final maturity of the Series 2003 Bonds shall not be later than October 1,2033.
All of the terms of the Series 2003 Bonds will be included in a certificate to be executed by
the Chairman following the award of the Series 2003 Bonds (the "Award Certificate") and
shall be set forth in the final Official Statement, as described herein.
SECTION 6. AWARD OF SERIES 2003 BONDS. The Chairman, on behalf
ofthe Issuer and only in accordance with the terms hereof and of the Official Notice of Sale,
shall award the Series 2003 Bonds to the underwriter or underwriters that submit a bid
proposal which complies in all respects with the Resolution and the Official Notice of Sale
and offers to purchase the Series 2003 Bonds at the lowest true interest cost to the Issuer, as
calculated by the Issuer's Financial Advisor in accordance with the tenns and provisions of
the Official Notice of Sale; provided, however, the Series 2003 Bonds shall not be awarded
to any bidder unless the true interest cost set forth in the winning bid (as calculated by the
Issuer's Financial Advisor) is equal to or less than 5.50%. In accordance with the provisions
of the Official Notice of Sale, the Chairman may, in his sole discretion, reject any and all
bids.
SECTION 7. REDEMPTION PROVISIONS FOR SERIES 2003 BONDS.
The Series 2003 Bonds may be redeemed prior to their respective maturities from any
moneys legally available therefor, upon notice as provided in the Resolution, upon the terms
and provisions as detennined by the Chainnan, in his discretion and upon the advice of the
Issuer's Financial Advisor; provided, however, with respect to optional redemption terms for
the Series 2003 Bonds, if any, the first optional redemption date may be no later than
October 1,2013 and no call premium may exceed 2.00% of the par amount of that portion of
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the Series 2003 Bonds to be redeemed. Term Bonds may be established with such
Amortization Installments as the Chairman deems appropriate and upon the advice of the
Issuer's Financial Advisor. The Chairman may determine, in his discretion and upon the
advice of the Issuer's Financial Advisor, that the Series 2003 Bonds shall not be subject to
any optional or mandatory redemption provisions. The redemption provisions for the Series
2003 Bonds, if any, shall be set forth in the ^ ward Certificate and in the final Official
Statement.
SECTION 8. FULL BOOK-ENTRY. Notwithstanding the provisions set
forth in Section 13 of the Resolution, the Series 2003 Bonds shall be initially issued in the
form of a separate single certiticated fully registered Series 2003 Bond for each of the
maturities of the Series 2003 Bonds. Upon initial issuance, the ownership of each such Bond
shall be registered in the registration books kept by the Registrar in the name of Cede & Co.,
as nominee of The Depository Trust Company C'DTC"). As long as the Series 2003 Bonds
are registered in the name of Cede & Co., all of the Outstanding Series 2003 Bonds shall be
registered in the registration books kept by the Registrar in the name of Cede & Co., all
payments of principal on the Series 2003 Bonds shall be made by the Paying Agent by check
or draft or by bank wire transfer to Cede & Co., as Holder of the Series 2003 Bonds, upon
prcsentation of the Series 2003 Bonds to be paid, to the Paying Agent.
With respect to Series 2003 Bonds registered in the registration books kept by the
Registrar in the name of Cede & Co., as nomince of DTC, the Issuer, the Registrar and the
Paying Agent shall have no responsibility or obligation to any direct or indirect participant in
the DTC book-entry program (the "Participants"). Without limiting the immediately
preceding sentence, the Issuer, the Registrar and the Paying Agent shall have no
responsibility or obligation with respect to (A) the accuracy of the records of DTC, Cede &
Co. or any Participant with rcspect to any ownership interest on the Series 2003 Bonds, (B)
the delivery to any Participant or any other Person other than a Bondholder, as shown in the
registration books kept by the Registrar, of any notice with respect to the Series 2003 Bonds,
including any notice of redemption, or (C) the payment to any Participant or any other
Person, other than a Bondholder, as shown in the registration books kept by the Registrar, of
any amount with respect to principal of, Redemption Price, if any, or interest on the Series
2003 Bonds. The Issuer, the Registrar and the Paying Agent may treat and consider the
Person in whose name each Series 2003 Bond is registered in the registration books kept by
the Registrar as the Holder and absolute owner of such Bond for the purpose of payment of
principal, Redemption Price, if any, and interest with respect to such Bond, for the purpose of
giving notices of redemption and other matters with respect to such Bond, for the purpose of
registering transfers with respect to such Bond, and for all other purposes whatsoever. The
Paying Agent shall pay all principal of, Redemption Price, if any, and interest on the Series
2003 Bonds only to or upon the order of the respective Holders, as shown in the registration
books kept by the Registrar, or their respective attorneys duly authorized in writing, as
provided herein and all such payments shall be valid and effective to fully satisfy and
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discharge the Issuer's obligations with respect to payment of principal of, Redemption Price,
if any, and interest on the Series 2003 Bonds to the extent of the sum or sums so paid. No
Person other than a Holder, as shown in the registration books kept by the Registrar, shall
receive a certificated Bond evidencing the obligation of the Issuer to make payments of
principal, Redemption Price, if any, and interest pursuant to the provisions of the Resolution.
Upon delivery by OTC to the Issuer of written notice to the effect that DTC has determined
to substitute a new nominee in place of Cede & Co., and subject to the provisions in the
Resolution with respect to transfers during the 15 days next preceding an Interest Date or first
mailing of notice of redemption, the words "Cede & Co." in this Supplemental Resolution
shall refer to such new nominee of DTC; and upon receipt of such notice, the Issuer shall
promptly deliver a copy of the same to the Registrar and the Paying Agent.
Upon (A) receipt by the Issuer of written notice from DTC (i) to the effect that a
continuation of the requirement that all of the outstanding Series 2003 Bonds be registered in
the registration books kept by the Registrar in the name of Cede & Co., as nominee of OTC,
is not in the best interest of the beneficial owners of the Series 2003 Bonds or (ii) to the
effect that OTC is unable or unwilling to discharge its responsibilities and no substitute
depository willing to undertake the functions of DTC hereunder can be found which is
willing and able to undertake such functions upon reasonable and customary terms, or (B)
determination by the Issuer that such book-entry only system is burdensome or undesirable to
the Issuer, the Series 2003 Bonds shall no longer be restricted to being registcred in the
registration books kept by the Registrar in the name of Cede & Co., as nominee ofDTC, but
may be registered in whatever name or names Holders shall designate, in accordance with the
provisions of the Resolution. In such event, the Issuer shall issue and the Registrar shall
authenticate, transfer and exchange the Scries 2003 Bonds of like principal amount and
maturity, in denominations of$5,000 or any integral multiple thereofto the Holders thereof.
The foregoing notwithstanding, until such time as participation in the book-entry only system
is discontinued, the provisions set forth in the Blanket Issuer Letter of Representations
previously executed by the Issuer and delivered to DTC shall apply to the payment of
principal of, premium, if any, and interest on the Series 2003 Bonds.
SECTION 9. APPLICATION OF SERIES 2003 BOND PROCEEDS; USE
OF OTHER MONEYS. (A) The proceeds derived from the sale of the Series 2003 Bonds
shall be applied by the Issuer as follows:
(i) An amount equal to the accrued interest, if any, on the Series 2003
Bonds shall be deposited to the Interest Account of the Sinking Fund and shall be
used to pay a portion of the interest on the Series 2003 Bonds.
(ii) A sufficient amount of the Series 2003 Bond proceeds shall be applied
to the payment of the premium for the hereinafter described Bond Insurance Policy
applicable to the Series 2003 Bonds, to the payment of the premium for the
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hereinafter described Reserve Account Surety Bond, and to the payment of costs and
expenses relating to the issuance of the Series 2003 Bonds.
(iii) A sufficient amount of the Series 2003 Bond proceeds shall be
deposited to the escrow deposit trust fund established pursuant to the hereinafter
described Escrow Deposit Agreement and shall be applied in accordance with the
provisions of the Escrow Deposit Agreement to refund the Refunded Bonds.
(iv) The remainder of the proceeds of the Series 2003 Bonds shall be
deposited to the Construction Fund and applied to pay the Cost of the Project.
(B) The Refunded Bonds will be refunded from a portion of the proceeds of the
Series 2003 Bonds and other legally available moneys of the Issuer. Any excess moneys on
deposit in the funds and accounts established for the Refunded Bonds under the Resolution
shall be transferred to the escrow deposit trust fund established pursuant to the hereinafter
described Escrow Deposit Agreement.
SECTION 10. PRELIMINARY OFFICIAL STATEMENT. The Issuer
hereby authorizes the distribution and use of the Preliminary Official Statement in
substantially the form attached hereto as Exhibit D in connection with the offering of the
Series 2003 Bonds for sale. If between the date hereof and the mailing of the Preliminary
Official Statement, it is necessary to make insertions, modifications or changes in the
Preliminary Official Statement, the Chairman is hereby authorized to approve such insertions,
changes and modifications. The Chairman is hereby authorized to deem the Preliminary
Official Statement "final" within the meaning of Rule 15c2- I 2(b)(1) under the Securities
Exchange Act of 1934 in the form as mailed. Execution of a certificate by the Chairman
deeming the Preliminary Official Statement "final" as described above shall be conclusive
evidence of the approval of any insertions, changes or modifications.
SECTION 11. OFFICIAL STATEMENT. The form, terms and provisions of
the Official Statement relating to the Series 2003 Bonds shall be substantially as set forth in
the Preliminary Official Statement and shall include all ofthe specific financial terms of the
Series 2003 Bonds. Subject in all respects to the award of the Series 2003 Bonds in
accordance with this Supplemental Resolution and the Official Notice of Sale, the Chairman
is hereby authorized and directed to execute and deliver said Official Statement in the name
and on behalf of the Issuer, and thereupon to cause such Official Statement to be delivered to
the Underwriters with such changes, amendments, modifications, omissions and additions as
may be approved by the Chairman. Said Official Statement, including any such changes,
amendments, modifications, omissions and additions as approved by the Chairman and the
information contained therein are hereby authorized to be used in connection with the sale of
the Series 2003 Bonds to the public. Execution by the Chainnan of the Official Statement
shall be deemed to be conclusive evidence of approval of such changes.
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SECTION 12. OFFICIAL NOTICE OF SALE. The form of the Official
Notice of Sale attached hereto as Exhibit C and the terms and provisions thereof are hereby
authorized and approved. The Chairman is hereby authorized to make such changes,
insertions and modifications as he shall deem necessary prior to the advertisement of such
Official Notice of Sale or a summary thereof. The Chairman is hereby authorized to
advertise and publish the Official Notice of Sale or a summary thereof at such time as he
shall deem necessary and appropriate, upon the advice of the Issuer's Financial Advisor, to
accomplish the competitive sale of the Series 2003 Bonds.
SECTION 13. AUTHORIZA TION TO EXECUTE ESCROW DEPOSIT
AGREEMENT. Subject in all respects to the award of the Series 2003 Bonds in accordance
with this Supplemental Resolution and the Official Notice of Sale, the Issuer hereby
authorizes the Chairman to execute and the Clerk to attest an Escrow Deposit Agreement (the
"Escrow Deposit Agreement") and to deliver the Escrow Deposit Agreement to Fifth Third
Bank, Cincinnati, Ohio, which is hereby appointed as escrow agent thereunder (the "Escrow
Agent"). All of the provisions of the Escrow Deposit Agreement when executed and
delivered by the Issuer as authorized herein and when duly authorized, executed and
delivered by the Escrow Agent, shall be deemed to be a part of this supplemental resolution
as fully and to the same extent as if incorporated verbatim herein, and the Escrow Deposit
Agreement shall be in substantially the form attached hereto as Exhibit E, with such changes,
amendments, modifications, omissions and additions, including the date of such Escrow
Deposit Agreement, as may be approved by the Chairman and the Clerk. Execution by the
Chairman and the Clerk of the Escrow Deposit Agreement shall be deemed to be conclusive
evidence of approval of such changes.
SECTION 14. APPOINTMENT OF PA YING AGENT AND REGISTRAR.
Subject in all respects to the award of the Series 2003 Bonds in accordance with this
Supplemental Resolution and the Official Notice of Sale, Fifth Third Bank, Cincinnati, Ohio,
is hereby designated Registrar and Paying Agent for the Series 2003 Bonds. The Chairman
and/or the Clerk are hereby authorized to enter into any agreement which may be necessary to
effect the transactions contemplated by this Section 14 and by the Resolution.
SECTION 15. MUNICIPAL BOND INSURANCE; RESERVE ACCOUNT
SURETY BOND. (A) Subject in all respects to the award of the Series 2003 Bonds in
accordance with this Supplemental Resolution and the Official Notice of Sale, the Issuer
hereby authorizes the payment ofthe principal of and interest on the Series 2003 Bonds to be
insured pursuant to a financial guaranty insurance policy (the "Bond Insurance Policy")
insuring the payment when due of the principal of and interest on the Series 2003 Bonds
issued by Ambac Assurance Corporation, a Wisconsin-domiciled stock insurance company
("Ambac Assurance"). The Chainnan and the Clerk are hereby authorized to execute such
documents and instruments necessary to cause Ambac Assurance to insure the Series 2003
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Bonds. With respect to the Series 2003 Bonds, Ambac Assurance shall be deemed to be the
"Insurer" as such term is used and defined in the Resolution.
(B) Subject in all respects to the award of the Series 2003 Bonds in accordance
with this Supplemental Resolution and the Official Notice of Sale, the Issuer shall deposit to
the Reserve Account a surety bond (the "Reserve Account Surety Bond") issued by Ambac
Assurance guaranteeing certain payments into the Reserve Account with respect to Bonds as
provided therein and subject to the limitations therein. The face amount of the Reserve
Account Surety Bond, together with any other cash amounts and the face amounts of any
other reserve policies or surety bonds on deposit in the Reserve Account, shall equal to the
Maximum Bond Service Requirement for all Outstanding Bonds. The Chairman is hereby
authorized to enter into a Guaranty Agreement substantially in the form attached hereto as
Exhibit G (the "Guaranty Agreement") in order to cause Ambac Assurance to issue such
Reserve Account Surety Bond. The provisions of such Guaranty Agreement, when executed
and delivered, shall be incorporated herein by refercnce and to the extent there are any
conflicts between the Guaranty Agreement and the Resolution, the provisions of the
Guaranty Agreement shall control. The Reserve Account Surety Bond shall constitute a
"Reserve Account Insurance Policy" for purposes of the Resolution.
SECTION 16. PROVISIONS RELATING TO BOND INSURANCE
POLICY AND RESERVE ACCOUNT SURETY BOND. (A) The commitment from
Ambac Assurance to issue its Bond Insurance Policy and Reserve Account Surety Bond with
respect to the Series 2003 Bonds is hereby approved and authorized and payment for the
premiums for such insurance is hereby authorized from proceeds of the Series 2003 Bonds.
A statement of insurance is hereby authorized to be printed on or attached to the Series 2003
Bonds for the benefit and information of the Holders of the Series 2003 Bonds.
(B) Subject in all respects to the award of the Series 2003 Bonds in accordance
with this Supplemental Resolution and the Official Notice of Sale, so long as the Bond
Insurance Policy issued by Ambac Assurance is in full force and effect and Ambac
Assurance has not defaulted in its payment obligations under the Bond Insurance Policy, the
Issuer agrees to comply with thc following provisions:
( 1) Notices to be given to Ambac Assurance. The Issuer or the Paying
Agent shall furnish to Ambac Assurance, upon request (to the attention of the
Surveillance Department, unless otherwise indicated), the following:
(a) as soon as practicable after the filing thereof, a copy of any
financial statement of the Issuer and a copy of any audit and annual report of
the Issuer;
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(b) a copy of any notice to be given to the registered owners of the
Series 2003 Bonds, including, without limitation, notice of any redemption of
or defeasance of Series 2003 Bonds, and any certificate rendered pursuant to
this Resolution relating to the security for the Series 2003 Bonds;
(c) To the extent that the Issuer has entered into a continuing
disclosure agreement with respect to the Series 2003 Bonds, Ambac Assurance
shall be included as party to be notified; and
(d) such additional information it may reasonably request.
The Paying Agent or Issuer shall notify Ambac Assurance of any failure of the
Issuer to provide any relevant notices, certificates, etc.
The Issuer will permit Ambac Assurance to discuss the affairs, finances and
accounts of the Issuer or any information Ambac Assurance may reasonably request
regarding the security for the Series 2003 Bonds with appropriate officers of the
Issuer. The Paying Agent or Issuer will permit Ambac Assurance to have access to
and to make copies of all books and records relating to the Series 2003 Bonds at any
reasonable time.
Ambac Assurance shall have the right to direct an accounting at the Issuer's
expense, and the Issuer's failure to comply with such direction within thirty (30) days
after receipt of written notice of the direction from Ambac Assurance shall be deemed
a default under the Resolution; provided, however, that if compliance cannot occur
within such period, then such period will be extended so long as compliance is begun
within such period and diligently pursued, but only if such extension would not
materially adversely affect the interests of any registered owner of the Series 2003
Bonds.
Notwithstanding any other proVIsIOn of the Resolution, the Issuer shall
immediately notify Ambac Assurance if at any time there are insufficient moneys to
make any payments of principal and/or interest as required and immediately upon the
occurrence of any event of default under the Resolution.
(2) Payment Procedure Pursuant to Bond Insurance Policy. As long as the
Bond Insurance Policy shall be in full force and effect, the Issuer and the Paying
Agent agree to comply with the following provisions:
(a) at least one (1) day prior to all Interest Dates the Paying Agent or
the Issuer will determine whether there will be sufficient funds in the funds
and accounts established under the Resolution to pay the principal of or
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interest on the Series 2003 Bonds on such Interest Date.ltOJing A~ent;
or the Issuer determines that there will be insufficient funds in such funds or
accounts, the Paying Agent or the Issuer shall so notify Ambac Assurance.
Such notice shall specify the amount of the anticipated deficiency, the Series
2003 Bonds to which such deficiency is applicable and whether such Series
2003 Bonds will be deficient as to principal or interest, or both. If the Paying
Agent or the Issuer has not so noti fied Ambac Assurance at least one (I) day
prior to an Interest Date, Ambac Assurance will make payments of principal or
interest due on the Series 2003 Bonds on or before the first (I st) day next
following the date on which Ambac Assurance shall have received notice of
nonpayment from the Paying Agent or the Issuer.
(b) the Paying Agent shall, after notice has been given to Ambac
Assurance as provided in (2)(a) above, make available to Ambac Assurance
and, at Ambac Assurance's direction, to The Bank of New York, in New York,
New York, as insurance trustee for Ambac Assurance or any successor
insurance trustee (the "Insurance Trustec"), the registration books of the Issuer
maintained by the Registrar and all records relating to the funds and accounts
maintained under the Resolution.
(c) the Registrar shall provide Ambac Assurance and the Insurance
Trustee with a list of registered owners of Series 2003 Bonds entitled to
receive principal or interest payments from Ambac Assurance under the terms
of the Bond Insurance Policy, and shall make arrangements with the Insurance
Trustee (i) to mail checks or drafts to the registered owners of the Series 2003
Bonds entitled to receive full or partial interest payments from Ambac
Assurance and (ii) to pay principal upon the Series 2003 Bonds surrendered to
the Insurance Trustee by the registered owners of the Series 2003 Bonds
entitled to receive full or partial principal payments from Ambac Assurance.
(d) the Paying Agent or Registrar shall, at the time it provides notice
to Ambac Assurance pursuant to (2)(a) above, notify registered owners of
Series 2003 Bonds entitled to receive the payment of principal or interest
thereon from Ambac Assurance (i) as to the fact of such entitlement, (ii) that
Ambac Assurance will remit to them all or a part of the interest payments next
coming due upon proof of Series 2003 Bondholder entitlement to interest
payments and delivery to the Insurance Trustee, in form satisfactory to the
Insurance Trustee, of an appropriate assignment of the registered owner's right
to payment, (iii) that should they be entitled to receive full payment of
principal from Ambac Assurance, they must surrender their Series 2003 Bonds
(along with an appropriate instrument of assignment in form satisfactory to the
Insurance Trustee to pennit ownership of such Series 2003 Bonds to be
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registered in the name of Ambac Assurance) for payment to the Insurance
Trustee, and not the Paying Agent, and (iv) that should they be entitled to
receive partial payment of principal from Ambac Assurance they must
surrender their Series 2003 Bonds for payment thereon first to the Paying
Agent who shall note on such Series 2003 Bonds the portion of the principal
paid by the Paying Agent and then, along with an appropriate instrument of
assignment in form satisfactory to the Insurance Trustee, to the Insurance
Trustee, which wi 11 then pay the unpaid portion of principal.
( e) in the event that the Paying Agent has notice that any payment of
principal of or interest on a Series 2003 Bond which has become due for
payment and which is made to a Series 2003 Bondholder by or on behalf ofthe
Issuer has been deemed a preferential transfer and theretofore recovered from
its registered owner pursuant to the United States Bankruptcy Code by a
trustee in bankruptcy in accordance with the final, nonappealable order of a
court having competent jurisdiction, the Paying Agent shall, at the time Ambac
Assurance is notified pursuant to (a) above, notify all registered owners that in
the event that any registered owner's payment is so recovered, such registered
owner will be entitled to payment from Ambac Assurance to the extent of such
recovery if sufficient funds are not otherwise available, and the Paying Agent
shall furnish to Ambac Assurance its records evidencing the payments of
principal of and interest on the Series 2003 Bonds which have been made by
the Paying Agent and subsequently recovered from registered owners and the
dates on which such payments were made.
(f) in addition to those rights granted Ambac Assurance under the
Resolution, Ambac Assurance shall, to the extent it makes payment of
principal of or interest on Series 2003 Bonds, become subrogated to the rights
of the recipients of such payments in accordance with the terms of the Bond
Insurance Policy, and to evidence such subrogation (i) in the case of
subrogation as to claims for past due interest, the Registrar shall note Ambac
Assurance's rights as subrogee on the registration books of the Issuer
maintained by the Registrar upon receipt from Ambac Assurance of proof of
the payment of interest thereon to the registered owners of the Series 2003
Bonds, and (ii) in the case of subrogation as to claims for past due principal,
the Registrar shall note Ambac Assurance's rights as subrogee on the
registration books of the Issuer maintained by the Registrar upon surrender of
the Series 200] Bonds by the registered owners thereoftogether with proof of
the payment of principal thereof.
(3) Consent of Ambac Assurance. Any provision of the Resolution
expressly recognizing or granting rights in or to Ambac Assurance may not be
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amended in any manner which affects the rights of Ambac Assurance hereunder
without the prior written consent of Ambac Assurance. Ambac Assurance reserves
the right to charge the Issuer a fee for any consent or amendment to the Resolution
while the Bond Insurance Policy is outstanding.
(4) Consent of Ambac Assurance in Addition to Bondholder's Consent.
Unless otherwise provided in this Section, Ambac Assurance's consent shall be
required in addition to Series 2003 Bondholder consent when Series 2003 Bondholder
consent is required for the following purposes: (a) execution and delivery of any
Supplemental Resolution; (b) removal of the Paying Agent and selection and
appointment of any successor trustee or paying agent; and (c) initiation or approval of
any action not described in (a) or (b) above which requires consent of the Series 2003
Bondholders.
(5) Consent of Ambac Assurance in the Event of Insolvency. Any
reorganization or liquidation plan with respect to the Issuer must be acceptable to
Ambac Assurance. In the event of any reorganization or liquidation, Ambac
Assurance shall have the right to vote on behaI f of all Holders of Series 2003 Bonds
absent a default by Ambac Assurance under the Bond Insurance Policy.
(6) Consent of Ambac Assurance Upon Default. Anything in the
Resolution to the contrary notwithstanding, upon the occurrence and continuance of
an event of default as defined in the Resolution, Ambac Assurance shall be entitled to
control and direct the enforcement of all rights and remedies granted to the Series
2003 Bondholders or the Paying Agent for the benefit of the Series 2003 Bondholders
under the Resolution.
(7) Provisions Conceming the Paying Agent.
(a) Ambac Assurance shall receive prior written notice of any
Paying Agent resignation.
(b) Every successor Paying Agent appointed pursuant to the
Resolution shall be a trust company or bank in good standing located in or
incorporated under the laws of the State, duly authorized to exercise trust
powers and subject to examination by federal or state authority, having a
reported capital and surplus of not less than $75,000,000 and acceptable to
Ambac Assurance. Any successor Paying Agent shall not be appointed unless
Ambac Assurance approves such successor in writing.
(c) Notwithstanding any other provision of the Resolution, in
determining whether the rights of the Series 2003 Bondholders will be
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adversely affected by any action taken pursuant to the terms and provisions of
the Resolution, the Paying Agent shall consider the effect on the Series 2003
Bondholders as if there were no Bond Insurance Policy.
(d) Notwithstanding any other provision of the Resolution, no
removal, resignation or termination of the Paying Agent shall take effect until
a successor, acceptable to Ambac Assurance, shall be appointed.
(8) Interested Parties. To the extent that the Resolution confers upon or
gives or grants to Ambac Assurance any right, remedy or claim under or by reason of
the Resolution, Ambac Assurance is thereby explicitly recognized as being a third-
party beneficiary thereunder and may enforce any such right, remedy or claim
conferred, given or granted thereunder. Nothing in the Resolution, expressed or
implied, is intended or shall be construed to confer upon, or to give or grant to, any
person or entity, other than the Issuer, the Paying Agent, Ambac Assurance and the
registered owners of the Series 2003 Bonds, any right, remedy or claim under or by
reason of the Resolution or any covenant, condition or stipulation hereof, and all
covenants, stipulations, promises and agreements in the Resolution contained by and
on behalf of the Issuer shall be for the sole and exclusive benefit of the Issuer, the
Paying Agent, Ambac Assurance and the registered owners of the Series 2003 Bonds.
(9) Defeasance. Notwithstanding anything in the Resolution to the
contrary, in the event that the principal and/or interest due on the Series 2003 Bonds
shall be paid by Ambac Assurance pursuant to the Bond Insurance Policy, the Series
2003 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
Ambac Assurance, and Ambac Assurance shall be subrogated to the rights of such
registered owners.
(C) As long as the Reserve Account Surety Bond shall be in full force and effect,
the Issuer and the Paying Agent agree to comply with the following provisions:
( I) In the event and to the extent that moneys on deposit in the Sinking
Fund, including all cash amounts on deposit in and credited to the Reserve Account
therein in excess ofthe amount of the Reserve Account Surety Bond, are insufficient
to pay the amount of principal and interest coming due, then upon the later of: (a) one
( I) day after receipt by the General Counsel of Ambac Assurance of a demand for
payment in the form attached to the Reserve Account Surety Bond as Attachment I
(the "Demand for Payment"), duly executed by the Paying Agent certifying that
payment due under the Resolution has not been made to the Paying Agent; or (b) the
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payment date of the Series 2003 Bonds as specified in the Demand for Payment
presented by the Paying Agent to the General Counsel of Ambac Assurance, Ambac
Assurance will make a deposit of funds in an account with the Paying Agent or its
successor, in Cincinnati, Ohio, sufficient for the payment to the Paying Agent, of
amounts which are then due to the Paying Agent under the Resolution (as specified in
the Demand for Payment) up to but not in excess of the Surety Bond Coverage, as
defined in the Reserve Account Surety Bond; provided, however, that in the event that
the amount on deposit in, or credited to, the Reserve Account, in addition to the
amount available under the Reserve Account Surety Bond, includes amounts available
under a letter of credit, insurance policy, surety bond or other such funding instrument
(the" Additional Funding Instrument"), draws on the Reserve Account Surety Bond
and the Additional Funding Instrument shall be made on a pro rata basis to fund the
insufficiency.
(2) The Paying Agent shall, after submitting to Ambac Assurance the
Demand for Payment as provided in ( I) above, make available to Ambac Assurance
all records relating to the funds and accounts maintained under the Resolution.
(3) The Paying Agent shall, upon receipt of moneys received from the draw
on the Reserve Account Surety Bond, as specified in the Demand for Payment, credit
the Reserve Account to the extent of moneys received pursuant to such Demand.
( 4) The Reserve Account shall be replenished in accordance with the terms
of the Resolution.
SECTION 17. SECONDARY MARKET DISCLOSURE. Subject in all
respects to the award of the Series 2003 Bonds in accordance with this Supplemental
Resolution and the Official Notice of Sale, the Issuer hereby covenants and agrees that, in
order to provide for compliance by the Issuer with the secondary market disclosure
requirements of Rule I5c2-12 of the Securities and Exchange Commission (the "Rule"), it
will comply with and carry out all of the provisions of the Continuing Disclosure Certificate
to be executed by the Issuer and dated the date of delivery of the Series 2003 Bonds, as it
may be amended from time to time in accordance with the terms thereof. The Continuing
Disclosure Certificate shall be substantially in the form attached hereto as Exhibit F with
such changes, amendments, modifications, omissions and additions as shall be approved by
the Chairman who is hereby authorized to execute and deliver such Certificate.
Notwithstanding any other provision of the Resolution, failure of the Issuer to comply with
such Continuing Disclosure Certificate shall not be considered an event of default under the
Resolution; provided, however, any Series 2003 Bondholder may take such actions as may be
necessary and appropriate, including seeking mandate or specific performance by court order,
to cause the Issuer to comply with its obligations under this Section 17 and the Continuing
Disclosure Certificate. For purposes of this Section 17, "Series 2003 Bondholder" shall mean
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any person who (A) has the power, directly or indirectly, to vote or consent with respect to,
or to dispose of ownership of, any Series 2003 Bonds (including persons holding Series 2003
Bonds through nominees, depositories or other intermediaries), or (B) is treated as the owner
of any Series 2003 Bonds for federal income tax purposes.
SECTION 18. GENERAL AUTHORITY. The members of the Board, the
Clerk and the officers, attorneys and other agents or employees of the Issuer are hereby
authorized to do all acts and things required of them by this Supplemental Resolution, the
Resolution, the Series 2003 Bonds, the Official Statement, the Continuing Disclosure
Certificate, the Guaranty Agreement or the Escrow Deposit Agreement or desirable or
consistent with the requirements hereof or the Resolution, the Series 2003 Bonds, the Official
Statement, the Continuing Disclosure Certificate, the Guaranty Agreement or the Escrow
Deposit Agreement for the full punctual and complete performance of all the terms,
covenants and agreements contained herein or in the Series 2003 Bonds, the Resolution, the
Official Statement, the Continuing Disclosure Certificate, the Guaranty Agreement and the
Escrow Deposit Agreement and each member, employee, attorney and officer ofthe Issuer or
the Board and the Clerk is hereby authorized and directed to execute and deliver any and all
papers and instruments and to do and cause to be done any and all acts and things necessary
or proper for carrying out the transactions contemplated hereunder. The Issuer hereby
authorizes its Bond Counsel and Financial Advisor to do all things necessary to acquire the
Escrow Securities. Ifthe Chairman is unavailable or unable at any time to perform any duties
or functions hereunder including but not limited to those described in Sections 5, 6 and 7
hereof, the Vice-Chairman is hereby authorized to act on his or her behalf.
SECTION 19. SEVERABILITY AND INVALID PROVISIONS. Ifanyone
or more of the covenants, agreements or provisions herein contained shall be held contrary to
any express provision oflaw or contrary to the pol icy of express law, though not expressly
prohibited or against public policy, or shall for any reason whatsoever be held invalid, then
such covenants, agreements or provisions shall be null and void and shall be deemed
separable from the remaining covenants, agreements or provisions and shall in no way affect
the validity of any of the other provisions hereof or of the Series 2003 Bonds.
SECTION 20. RESOLUTION TO CONTINUE IN FORCE. Except as
herein expressly provided, the Resolution and all the terms and provisions thereof are and
shall remain in full force and effect.
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,.
..Iii
rill
SECTION 21. EFFECTIVE DATE. This Supplemental Resolution shall
become effective immediately upon its adoption.
nUL Y ADOPTED, in Regular Session this 23rd day of September, 2003.
COLLIER COUNTY, FL RIDA
By:
(SEAL)
ATTEST:
""~' I,t) . L'!,
~'\~:~~ ~ ~A.,k
Cl0i-k' . ' . .:.. :'" ~
-; '.attest .,to'Clllf......
'. sfgda€arw'.'Y.
Approvettas toFonn and
Legal Sufficiency:
f ~ w Idf
Ct. I ( ..,r County Attorney
1f1' JJ)
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.....,
EXHIBIT A
GENERAL DESCRIPTION OF THE PROJECT
The Project generally includes the following, as more particularly described in the
plans and specifications on file with the Issuer, and as the same may be amended or
supplemented from time to time:
. Acquisition, construction and equipping of a County Jail Complex
. Acquisition, construction and equipping of the County Development
Services Building expansion and associated parking garage
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...... ~. ~'::f(
EXHIBIT B
REPORT REQUIRED BY SECTION 191(1) OF THE RESOLUTION
New Money:
Community Development
Building Expansion
$8,000,000
$4,500,000 October, 2003
nfa
Jail Expansion
Total New Money
$46,000,000
$54,000,000
$38,500,000 June, 2005
$43,000,000
nfa
EXHIBIT C
FORM OF OFFICIAL NOTICE OF SALE
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OFFICIAL NOTICE OF SALE
$48,920,000*
Collier County, Florida
Capital Improvement and Refunding Revenue Bonds, Series 2003
NOTICE IS HEREBY GIVEN that electronic (as explained below) proposals will
be received electronically via Bidcomp/Parity Competitive Bidding System ("PARITY") in
the manner described below, until 12:00 p.m. Eastern time, on October 7,2003 on behalf of
Collier County, Florida (the "Issuer") for the purchase of all of the above-referenced Bonds
(the "Bonds").
Bids must be submitted electronically via PARITY in accordance with this Official
Notice of Sale, until] 2 :00 p.m., Eastern time, and no bid will be received after the time for
receiving bids specified above. The time and date of the bid submission may be changed by
the Issuer upon at least 20 hours notice and will be announced by TM3 News Service
("TM3 ") by notice given not later than 4:00 p.m., Eastern time, on the last business day prior
to the announced date for receipt of bids. To the extent any instructions or directions set
forth in PARITY conflict with this Official Notice ofSa1e, the terms of this Official Notice of
Sale shall control. For further information about PARITY and to subscribe in advance ofthe
bid, potential bidders may contact PARITY at (212) 404-8] 02. In the event ofa malfunction
in the electronic bidding process, the bid date will automatically change to thc next business
day as confirmed in a communication through TM3.
Disclaimer
Each prospective electronic bidder must be a subscriber to the Bidcomp Competitive
Bidding System. Each qualified prospective electronic bidder shall be solely responsible to
make necessary arrangements to view the bid form on PARITY and to access PARITY for the
purposes of submitting its bid in a timely manner and in compliance with the requirements of
the Official Notice of Sale. Neither the Issuer nor PARITY, shall have any duty or obligation
to provide or assure access to PARITY to any prospective bidder, and neither the Issuer nor
PARITY shall be responsible for a bidder's failure to register to bid or for proper operation of,
or have any liability for any delays or interruptions of, or any damages caused by, PARITY.
.. Preliminary. subject to change.
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The Issuer is using PARITY as a communication mechanism, and not as the Issuer's
agent, to conduct the electronic bidding for the Bonds. The Issuer is not bound by any advice
and determination of PARITY to the effect that any particular bid complies with the terms of
this Official Notice of Sale and, in particular, the bid specifications hereinafter set forth. All
costs and expenses incurred by prospective bidders in connection with their registration and
submission of bids via PARITY are the sole responsibility of the bidders; and the Issuer is not
responsible, directly or indirectly, for any of such costs or expenses. If a prospective bidder
encounters any difficulty in submitting, modifying or withdrawing a bid for the Bonds, the
prospective bidder should telephone PARITY at (212) 404-8102 and notify the Issuer's
Financial Advisor, William J. Reagan, at (239) 649-6077 or by facsimile at (239) 649-6217.
All Bonds shall be in fully registered form in the denominations of$5,000 each or any
integral multiple thereof, shall be dated October I, 2003, and shall bear interest payable semi-
annually on April 1 and October 1 commencing April I, 2004, until maturity. The Bonds
shall be issued in fully-registered book entry only form through a program qualified with The
Depository Trust Company, New York, New York ("DTC"), as depository, and shall be
registered in the name of Cede & Co., as nominee for DTC. All payments of principal,
semiannual interest and redemption premiums, if any, on the Bonds shall be paid by Fifth
Third Bank, Cincinnati, Ohio, as paying agent and bond registrar by wire transfer to Cede &
Co.
The Bonds are issued pursuant to the Constitution and laws of the State of Florida,
including Resolution No. 85-107 duly adopted by the Board of County Commissioners ofthe
Issuer on April 30, 1985, as amended and supplemented (the "Bond Resolution") and other
applicable provisions of law.
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Maturity Schedule
The Bonds will bc dated October 1, 2003 and will mature on October I of the
following years in the following principal amounts*:
Year Principal Amount* Year Principal Amount*
2004 $1,305,000 2019 $1,350,000
2005 1,335,000 2020 1,410,000
2006 1,355,000 2021 1,4 70,000
2007 1,390,000 2022 1,535,000
2008 1,425,000 2023 1,610,000
2009 1,460,000 2024 1,685,000
2010 1,490,000 2025 1,765,000
2011 1,540,000 2026 1,845,000
2012 1,595,000 2027 1,935,000
2013 1,655,000 202X 2,025,000
2014 1, I 05,000 2029 2,120,000
2015 1,150,000 2030 2,230,000
2016 1,195,000 2031 2,345,000
2017 1,245,000 2032 2,465,000
2018 1,295,000 2033 2,590,000
Bidders may designate in their proposal two or more consecutive serial maturities
beginning no earlier than October I, 2018 and in any year thereafter as a tcrm bond which
matures on the maturity date of the last serial maturity of the sequence. More than one such
sequence of serial maturities may be designated as a term bond. Any term bond so
designated shall be subject to mandatory redcmption in each year on the principal payment
date and in the entire amount of each serial maturity designated for inclusion in such term
bond, all in accordancc with the Bond Resolution.
Interest will be calculated on the basis of a 360-day year of twelve 30-day months.
Redemption
Optional Redemption. The Bonds maturing prior to October I, 2014 will not be
subject to optional redemption prior to maturity. The Bonds maturing on or after October 1,
2014 shall be subject to redemption prior to their respective maturities, at the option of the
Issuer on or after October 1, 2013, as a whole or in part at any time, and if in part, by
* Preliminary, subject to change.
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maturities to be selected by the Issuer and by lot within a maturity ifless than a full maturity,
at a redemption price equal to 100% of the principal amount of the Bonds to be redeemed
plus accrued interest to the date fixed for redemption.
Mandatory Redemption. If any Bonds are designated as term bonds pursuant to the
section entitled "Maturity Schedule" herein, such Bonds shall be subject to mandatory
redemption in accordance with the provisions of the Bond Resolution and as described in the
Official Statemcnt relating to the Bonds.
Award of Bonds
The Bonds will be awarded to thc bidder earning the lowest true interest cost for all
the Bonds in any legally acceptable proposal and offering to pay not less than ninety-eight
percent (98%) or not greater than one hundred five percent (105%) of par, plus accrued
interest, ifany. The lowest true interest cost will be determined with respect to each proposal
by doubling the semiannual interest rate, compounded semiannually, necessary to discount
the debt service payments from the payment dates to the dated date of the Bonds, and to the
price bid, including interest accrued to the date of delivery of the Bonds. If two or more
responsible bidders offer to purchase the Bonds at the same lowest true interest cost, the
Bonds shall be awarded to the bidder offering the highest premium, and if the highest
premium is offered by two or more such bidders (or ifno premium is offered by any of such
bidders), thc Issuer will award the Bonds to onc of such bidders by lot. Only thc final bid
submitted by any bidder through PARITY will be considercd. The right rcservcd to the Issuer
shall be final and binding upon all bidders with respect to the form and adequacy of any
proposal received and as in its conformity to the terms of this Official Notice of Sale.
The Issuer will not accept and will reject any bid for less than all of the above
described Bonds. The right is reserved to reject any and all bids for any reason. No
facsimile bids will be accepted.
Terms of Sale
Bidders shall state in their proposals the rate or rates of interest to be paid on all the
Bonds, on which rate or rates their proposals are based and submitted. The rates so earned
must be in multiples of 1/8 or 1/20 of 1%. Bidders may specify more than one rate of interest
to be borne by the Bonds but may not specify more than one rate for the Bonds of any single
maturity. A zero interest rate may not be named for any maturity.
No bid will be accepted for less than all of the Bonds, or for less than ninety-eight
percent (98%) of the par value or greater than one hundred five percent (105%) of par
thereof, plus accrued interest, if any. No more than one (1) bid from any bidder will be
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considered. All bids received shall be considered by the Chairman of the Board of County
Commissioners of the Issuer or his designee (the "Chairman") and certain other officials of
the Issuer within three (3) hours of the deadline for receiving bids on the bidding date, and
unless all bids are rejected, the Bonds shall be awarded by the Chairman on said date to the
best bidder whose proposal will result in the lowest true interest cost to the Issuer. The
Original Purchaser (the "Original Purchaser") shall pay accrued interest from the date of the
Bonds to the date of delivery and payment of the purchase price. All bids remain firm until
an award is made. As promptly as reasonably practicable after the bids are opened, the Issuer
will notify the bidder to whom the Bonds will be awarded, ifand when such award is made.
Insurance
The Issuer has received commitments from Ambac Assurance Corporation (the
"Insurer") of its intent to issue a municipal bond insurance policy insuring payment of
principal and interest on the Bonds, when due, and a reserve account surety bond. The cost
of the municipal bond insurance and surety bond will be paid by the Issuer. Information
regarding the commitments may be obtained [rom the financial advisor to the Issuer, William
R. Hough & Co., 500 5th Avenue South, Suite 509, Naples, Florida, 34102-6407, (239) 649-
6077, attention: William J. Reagan.
Electronic Bidding Procedures
Electronic bids must be submitted [or the purchase of the Bonds via PARITY. Bids
will be communicated electronically to the Issuer at 12 :00 p.m., Eastern time, on October 7,
2003. Prior to that time, a prospective bidder may (I) submit the proposed terms of its bid
via PARITY, (2) modify the proposed terms of its bid, in which event the proposed terms as
last modified will (unless the bid is withdrawn as described herein) constitute its bid for the
Bonds, or (3) withdraw its proposed bid. Once the bids are communicated electronically via
PARITY to the Issuer, each bid will constitute an irrevocable offer to purchase the Bonds on
the terms therein provided. For purposes of the electronic bidding process, the time as
maintained on PARITY shall constitute the official time.
1. Good Faith Deposit
All bidders must submit a "Good Faith Deposit" (the "Deposit") in the fonn of a
cashier's or certified check or a Financial Surety Bond in the amount of $550,000. The
financial Surety Bond must be from such insurance company acceptable to the Issuer and
licensed to issue such a bond in the State. Such financial Surety Bond must be submitted to
the Issuer no later than 5:00 p.m. Eastern time, on the day prior to the sale. The financial
Surety Bond must identify the Bidder whose Deposit is guaranteed by such Financial Surety
Bond.
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2. Submission of Deposit
lfthe Issuer selects a winning bid, then such successful bidder is required to submit its
Deposit (if original deposit was a Financial Surcty Bond) to the Issuer in the form of a wire
transfer not later than 2:00 p.m. Eastern time on the next business day following the award.
It such Deposit is not rcceived by that time, the Financial Surety Bond may be drawn by the
Issuer to satisfy the Deposit requirement. The Deposit of the successful bidder will be
collected and the proceeds thereof retained by the Issuer to be applicd in part payment for the
Bonds and no interest will be allowed or paid upon the amount thereof, but in the event the
successful bidder shall fail to comply with the terms of the bid, the proceeds thereof will be
retained as and for full liquidated damages. Any checks of unsuccessful bidders will be
returned promptly after the Bonds are awarded.
Notwithstanding anything herein to the contrary, the Issuer will not accept any
bids and will not issue the Bonds unless the Bonds satisfy the preconditions for issuance
of the Bonds established by the Bond Resolution.
3. Amendment of Notice
Amendments hereto and notices, if any, pertaining to this offering shall be made
through i-Deal at their website of www.i-dealprospectus.com. The Issuer may revise this
Official Notice of Sale by written notice to prospective bidders at the place of sale at the time
of sale for submission of bids by publishing notice of any revisions on TM3 News Service at
or before the timc for submission of bids. Any bid submitted shall be in accordance with,
and incorporate by reference, this Official Notice of Sale including any revisions made
pursuant to this paragraph.
The Issuer reserves the right to postpone, from time to time, the date established for
the receipt of bids. Any such postponement will be announced by TM3 by notice given not
latcr than 4:00 p.m., Eastern time, on the last business day prior to the announced date for the
receipt of bids. If any date fixed for the receipt of bids and the sale of the bonds is
postponed, any alternative sale date (the "Alternative Salc Date") will be announced via TM3
News Service at least 20 hours prior to such Alternative Sale Date. In addition, the Issuer
reserves the right, on the date established for the receipt of bids, to reject all bids and
cstablish a subsequent Alternative Sale Date. Ifall bids are rejected and an Alternative Sale
Date for receipt of bids established, notice of the Alternative Sale Date will be announced via
TM3 News Service not less than 20 hours prior to such Alternative Sale Date. On any such
Alternative Salc Datc, any bidder may submit a bid for the purchase of the Bonds in
conformity in all respects with the provisions of this Official Notice of Sale except for the
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date of sale and except for the changes announced by TM3 News Scrvice at the time the sale
date and time are announced.
Adiustment of Principal Amounts
If, after final computation ofthe bids, the Issuer determines in its sole discretion that
the funds nccessary to accomplish the purposes of the Bonds are greater or less than the
proceeds of the sale of the Bonds, the Issuer reserves the right to adjust each maturity amount
of the Bonds and to correspondingly adjust the Bond issue size, all calculations to be rounded
to the nearest $5,000. Furthermore, the Issuer reserves the right to adjust maturity amounts
to achieve substantially lcvel debt service for all of its debt obligations outstanding under the
Bond Resolution, without substantially changing the Bond issue size.
In the event of any such adjustment, no rebidding or recalculation of the Bids
submitted will be required or permitted. The purchase price of the Bonds will be computed
by taking the adjusted par amount of the Bonds and: (I) either subtracting the aggregate
original issue discount or adding the aggregate original issue premium, as applicable,
computed based on the adjusted par amounts of each maturity of the Bonds and the prices
provided by the underwriters, and (2) subtracting the amount obtained by multiplying the per
bond dollar amount ofthe underwriters' spread by the adjusted par amount of the Bonds. The
Bonds of each maturity, as adjusted, will bear interest at the same rate and must have the
same initial reoffering yields as specified for the maturity immediately after award of the
Bonds by the successful bidder for the Bonds. However, the award will be made to the
bidder whose Bid produces the lowest true interest cost, calculated as specified, solely on the
basis ofthc Bonds offered, without taking into account any adjustment in the amount of the
Bonds pursuant to this paragraph.
Purpose
The Bond proceeds will be used to finance certain capital improvements within the
jurisdiction of the Issuer, current refund certain outstanding indebtedness ofthe Issuer, fund
the Reserve Account with a surety bond, and pay related costs and expenses in connection
with the issuance of the Bonds, including the premium for municipal bond insurance.
Security and Sources of Payment for the Bonds
Payment of the principal of and interest on the Bonds will be payable solely from and
secured by a licn upon and pledge of the Pledged Revenues, as described in the Bond
Resolution and the Preliminary Official Statement for the Bonds. Pledged Revenues include
the Issuer's proceeds of the local government half cent sales tax defincd and described in and
distributed pursuant to Part VI, Chapter 218, Florida Statutes, as amended (the "Sales Tax
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Revenues"). Additionally, Pledged Revenues include investment income derived from the
investment of moneys in thc Reserve Account established under the Bond Resolution. The
Bonds shall be secured by the Reserve Account as further described in the Preliminary
Official Statement. The Bonds shall be on parity with certain other indebtedness of the
Issuer as provided in the Bond Resolution and described in the Preliminary Official
Statement.
CDSIP Numbers and Book Entry
It is anticipated that CUSIP numbers will be printed on the Bonds at the Issuer's
expense. In no event will the Issuer be responsible for such numbers nor will Bond Counsel
review or express any opinion as to the correctness of such numbers, and incorrect numbers
on said Bonds shall not be cause for the Original Purchaser to refuse to accept delivery of
said Bonds. It shall be the responsibility of the Original Purchaser to timely obtain and pay
for the assignment of the CUSIP numbers. It is also anticipated that Bonds will bc in book-
entry form with a securities depository to act as the Bondholders' nominee pursuant to the
terms of the Bond Resolution.
Delivery of Bonds
The Bonds are expected to be delivered in New York, New York (or such other place
as may be mutually agreed upon) within 45 days aftcr the award. Should delivery be delayed
beyond 45 days trom the datc ofthe award, for any reason except failure of performance by
the Original Purchaser, the Original Purchaser may withdraw his bid and thereafter his
interest in and liability for the Bonds will cease. When the Bonds are ready for delivery, the
Issuer may give the Original Purchaser three working days' notice of the delivery date and
the Issuer will expect payment in full on that date, otherwise reserving the right at its option
to dctermine that the Original Purchaser has failed to comply with the offer of purchase.
Payment for the Bonds must be in Federal Funds or other funds available for immediate
credit. Currently, the Issuer plans to conduct the closing on or about October 22, 2003 at
12:00 p.m. in Naples, Florida. When delivered, the Bonds shall be duly executed and
authenticated and registered via the securities depository.
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Legal Opinions
Said Bonds will be sold subject to the opinion of Nabors, Giblin & Nickerson, P.A.,
the Issuer's Bond Counsel, as to the legality thereof and such opinion will be furnished
without cost to the purchaser and all bids will be so conditioned. A form of Bond Counsel's
opinion is attach cd to the Preliminary Official Statement as Appendix F. Certain matters will
be passed on by David C. Weigel, County Attorney and Bryant Miller & Olive P.A.,
Disclosure Counsel to the Issuer.
Blue Sky Laws
The Issuer has not undertaken to register the Bonds under the securities laws of any
state, nor investigated the eligibility of any institution or person to purchaser or participate in
the underwriting of the Bonds undcr any applicable legal investment, insurance, banking or
other laws. By submitting a bid for the Bonds, the successful bidder represents that the sale
of the Bonds in statcs other than Florida will be made only under exemptions from
registration or, wherever necessary, the succcssful bidder will register the Bonds in
accordance with the securities laws of the statc in which the Bonds are offered or sold. The
Issuer agrees to cooperate with the successful bidder, at the bidder's written request and
expense, in registering the Bonds or obtaining an exemption from registration in any state
where such action is neccssary; provided, however, that the Issuer shall not be required to
consent to suit or to service of process in any jurisdiction.
Disclosure Obligations of the Purchaser
Section 218.38( I )(b )(2), Florida Statutes, requires that the Purchaser file a statement
with the Issuer containing information with respect to any fee, bonus or gratuity paid, in
connection with the Bonds, by any underwriter or financial consultant to any person not
regularly employed or engaged by such underwriter or consultant. Receipt of such statement
is a condition prccedent to the delivery of the Bonds to such successful bidder.
The winning bidder must (1) complete the Truth-in-Bonding Statement provided by
Bond Counsel (the form of which is attached hereto as Exhibit A) and (2) indicate whether
such bidder has paid any finder's fee to any person in connection with the sale ofthe Bonds
in accordance with Section 218.386, Florida Statutes.
The successful purchaser will be required to submit to the Issuer prior to closing a
certification to the effect that (i) all of the Bonds have been subject of a bona fide initial
offering to the public (excluding bond houses, brokers or similar persons or organizations
acting in the capacity ofunderwritcrs or wholesalers) at prices no higher than, or yields no
lower than, those shown on the cover of the Official Statement relating to the Bonds, and (ii)
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to the best of their knowledge, and based on their records and other information available to
them which they believe to be correct, at least 10 percent of each maturity of the Bonds were
sold to the public (excluding bond houses, brokers or similar persons or organizations acting
in the capacity of underwriters or wholesalers) at initial offering prices not greater than, or
yields no lower than, the respective prices or yields shown on the cover of the Official
Statement, and (iii) at the time they agreed to purchase the Bonds, based upon their
assessment of the thcn prevailing market conditions, they had no reason to believe any of the
Bonds would be sold to the public (excluding bond houses, brokers or similar persons or
organizations acting in the capacity of underwriters or wholesalers) at prices greater than, or
yields lower than, those shown on the cover of the Official Statement including interest
accrued on the Bonds.
Continuing Disclosure
The Issuer has covenanted to provide ongoing disclosure in accordance with Rule
15c2-12 of the Securities and Exchange Commission. The specific nature ofthe information
to be contained in the Annual Report and the notices of material events are set forth in the
Continuing Disclosure Certificate which is reproduccd in its entirety in Appendix G attached
to the Preliminary Official Statement for the Bonds. The covenants have been undertaken by
the (ssuer in order to assist the Original Purchaser in complying with clause (b)(5) of Rule
15c2-12 of the Securities and Exchange Commission. To date, the Issuer has complied with
clause (b)(5) of Rule ] 5c2-12 (the "Rule") of the Securities and Exchange Commission for all
outstanding debt currently subject to such Rule.
Copies of Documents
Copies of the Preliminary Official Statement, which will be available on or after
September _, 2003 and this Official Notice of Sale and further information which may be
desired, may be obtained electronically through i-Deal at www.i-dealprospectus.com. or from
the Issuer's Financial Advisor, William R. Hough & Co., 500 5th Avenue South, Suite 509,
Naples, Florida, 34102-6407, (239) 649-6077, attention: William J. Reagan. Each bidder is
required to read the Preliminary Official Statement in its entirety.
Is/ Tom Henning
Chairman, Board of County Commissioners
Collier County, Florida
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EXHIBIT A
FORM OF TRUTH-IN-BONDING STATEMENT
October , 2003
Board of County Commissioners
Collier County, Florida
Re: $ Collier County, Florida Capital Improvement and
Refunding Revenue Bonds, Series 2003
Dear Commissioners:
The purpose of the following two paragraphs is to furnish, pursuant to the provisions
of Sections 218.385(2) and (3), Florida Statutes, as amended, the truth-in-bonding statement
required thereby, as follows:
(a) The County is proposing to issue $__ principal amount of the above-
referenced Bonds for the principal purposes of (1) current refunding certain outstanding
obligations of the County as more fully described in the Preliminary Official Statement
relating to the Bonds and (2) financing the acquisition and construction of certain capital
improvements. This obligation is expected to be repaid over a period of approximately 29.92
years. At a true interest cost of __%, total interest paid over the life of the obligation
will be approximately $
(b) The source ofrepayment or security of the Bonds is the Pledged Revenues (as
described in the Preliminary Official Statement). Authorizing this debt will result in
approximately $ of the Pledged Revenues not being available for other services
of the County each year for 29.92 years.
The foregoing is provided for information purposes only and shall not affect or control
the actual terms and conditions of the Bonds.
Very truly yours,
Underwriter
By:
Authorized Signatory
EXHIBIT D
FORM OF PRELIMINARY OFFICIAL STATEMENT
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PRELIMINARY OFFICIAL STATEMENT DATED SEPTEMBER 29, 2003
NEW ISSUE -BOOK ENTRY ONLY
ANTICIPATED RATINGS: [Fitch: "AAA" (Insured) and "AA." (Underlying)
Moody's: "Aaa" (Insured) and "AI" (Underlying)
Standard & Poor's: "AAA" (Insured) and "AA-" (Underlying)]
(Ambac Insured) (See "RATINGS" herein)
In the opinion of Nabors, Giblin & Nickerson, P.A., Tampa, Florida, Bond Counsel, interest on the Series
2003 Bonds (as hereinafter defined) is, under existing statfltes, regulations, rulings and court decisiolls: (a)
excludable from gross income for federal income tax purposes except as othenoise described herein under the caption
"TAX EXEMPTION" and (b) not an item of tax preference for purposes of the federal alternative minimum tax
imposed on individlmls rmd corporations. Such interest, however, will be includable in the calculation of a
corporation's alternative minimum taxable income and may be subject to other federal income tax consequences
referred to herein under the cnption "TAX EXEMPTION. N Bond Counsel is further of the opinion that the Series
2003 Bonds and the interest thereon are exempt from all present intangible personal property taxes imposed
pursuant to Chapter 199, Florida Statutes. See NT AX EXEMPTIONN herein for a discussion of Bond Counsel's
opinion, including a discussion of the corporate alternative minimum lax.
$54,370,000"
COLLIER COUNTY, FLORIDA
Capital Improvement and Refunding Revenue Bonds,
Series 2003
Dated: October 1,2003
Due: October 1, as shown below
The Capital Improvement and Refunding Revenue Bonds, Series 2003 (the "Series 2003 Bonds")
are being issued by Collier County, Florida (the "County") as fully registered bonds, which initially will
be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New
York COTC"). Individual purchases will be made in book-entry form only through Participants (defined
herein) in denominations of $5,000 and integral multiples thereof. Purchasers of the Series 2003 Bonds
(the "Beneficial Owners") will not receive physical delivery of certificates. Transfers of ownership
interests in the Series 2003 Bonds will be effected by the UTC book-entry system as described herein. As
long as Cede & Co. is the registered owner as nominee of DTC, principal and interest payments will be
made directly to such registered owner which will in turn remit such payments to the Participants (as
defined herein) for subsequent disbursement to the Beneficial Owners. Interest on the Series 2003 Bonds
is payable on April 1, 2004 and semiannually on each October land Aprill thereafter. Principal of,
premium, if any, and interest on the Series 2003 Bonds will be payable by Fifth Third Bank, Cincinnati,
Ohio, as Paying Agent and Registrar.
The Series 20m Bonds are subject to optional and mandatory redemption prior to their stated
maturities as described herein.
This cover page contains certain information for quick reference only. It is not, and is not
intended to be, a summary of the issue. Investors must read the entire Official Statement to obtain
information essential to the making of an informed investment decision.
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The Series 2003 Bonds are being issued for the purpose of providing funds, together with other
legally available funds of the County, to (i) reimburse or finance the costs of acquisition, construction and
equipping of various capital improvements within the County including, but not limited to, acquisition,
construction and equipping of a County Jail Complex and the County Development Services Building
expansion and associated parking garage (collectively, the "Project"), (ii) refund, on a current basis, all of
the County's then outstanding Capital Improvement Revenue Refunding Bonds, Series 1992, and (iii) pay
certain costs of issuance of the Series 2003 Bonds, including the municipal bond insurance premium and
the reserve account insurance policy premium.
The Series 2003 Bonds are payable from and secured by a lien upon the proceeds of the local
government half-cent sales tax, as defined and described in, and distributed to the County under,
Chapter 218, Part VI, Florida Statutes, and certain other investment earnings under the Resolution (as
defined herein) (collectively, the "Pledged Revenues"), on a parity in all respects with certain other
outstanding obligations of the County more fully described herein.
The Series 2003 Bonds shall neither constitute general indebtedness of the County nor a pledge of
its full faith, credit or taxing power within the meaning of any constitutional or statutory provision or
limitation, but shall be payable solely from and secured by a lien upon und pledge of the Pledged
Revenues as provided in the Resolution. No Holder or Holders of the Series 2003 Bonds shall ever have
the right to require or compel the exercise of the ad valorem taxing power of the County to pay the Series
2003 Bonds or the interest thereon or to make any other puyments provided in the Resolution. The Series
2003 Bonds and the indebtedness evidenced thereby shall not constitute a lien upon the Project or any
other property of the County, but shall constitute a lien upon the Pledged Revenues to the extent and in
the manner provided in the Resolution.
Payment of the principal of and interest on the Series 2003 Bonds when due will be insured by a
financial guaranty insurance policy to be issued simultaneously with the delivery of the Series 2003
Bonds by Ambac Assurance Corporation. See "FINANCIAL GUARANTY INSURANCE" herein.
[Ambac Logo]
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"1
AMOUNTS, MATURITIES, INTEREST RATES,
PRICES OR YIELDS AND INITIAL CUSIP NUMBERS
$ Serial Bonds
Initial Initial
Maturity Interest Price or Cusip Maturity Interest Price or Cusip
(October 1) Amount Rate Yield Numbers !Qrtober D Amount Rate Yield Numbers
$
%
%
$
%
%
$
$
$
% Term Bonds due October 1, _ - Price or Yield _ % - Initial Cusip No. _
% Term Bonds due October 1, _ - Price or Yield _% - Initial Cusip No._
% Term Bonds due October 1, _ - Price or Yield _% - Initial Cusip No._
(Accrued interest to be added)
TIle Series 2003 Bonds are offered when, as and If issued and received by the Underwritf!r, subject to the
approval as to legality fly Nabors, Giblin & Nickerson, P.A., Tampa, Florida, Bond Counsel. Cerfain legal matters
will be passed on for the County by David C. Weigel, Esq., County Attorney, and by Bryant Miller & Olive P.A.,
Tampa, Florida, Disclosure Counsel. William R. Hough & Co., Naples, Florida is acting as Financial Advisor to
the County. It is expected that the Series 2003 Bonds will be delivered to the facilities of OTC in New York, New
York on or about October 22,2003.
Sealed bids for the Series 2003 Bonds will be received through the BIDCOMP!P ARlIT
COMPETITIVE BIDDING SYSTEM as specified in the Official Notice of Sale.
Dated: October ----J 2003
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RED HERRING LANGUAGE:
This Preliminary Official Statement and the information contained herein are subject to completion or
amendment. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell
or a solicitation of an offer to buy, nor shall there be any sale of the Series 2003 Bonds in any jurisdiction
in which such offer, solicitation or sale would be unlawful prior to registration, qualification or
exemption under the securities laws of such jurisdiction. The County has deemed this Preliminary
Official Statement "final," except for certain permitted omissions, within the contemplation of Rule 15c2-
12 promulgated by the Securities and Exchange Commission.
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COLLIER COUNTY, FLORIDA
Government Complex
3301 East Tamiami Trail
Naples, Florida 34112
(239) 774-8097
BOARD OF COUNTY COMMISSIONERS
Tom Henning, Chairman
Donna Fiala, Vice Chairman
Jim Coletta, Commissioner
Fred W. Coyle, Commissioner
Frank Halas, Commissioner
COUNTY MANAGER
James V. Mudd
CLERK OF THE CIRCUIT COURT OF COLLIER COUNTY
AND CHIEF FINANCIAL OFFICER,
Dwight E. Brock, Esq.
DIRECTOR OF FINANCE AND ACCOUNTING
James L. Mitchell, CIA, CFE, CBA
COUNTY ATTORNEY
David C. Weigel, Esq.
BOND COUNSEL
Nabors, Giblin & Nickerson, P.A.
Tampa, Florida
DISCLOSURE COUNSEL
Bryant Miller & Olive P.A.
Tampa, Florida
FINANCIAL ADVISOR
William R. Hough & Co.
Naples, Florida
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No dealer, broker, salesman or other person has been authorized by the County to give any
information or to make any representations in connection with the Series 2003 Bonds other than as
contained in this Official Statement, and, if given or made, such information or representations must not
be relied upon as having been authorized by the County. This Official Statement does not constitute an
offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 2003 Bonds by
any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or
sale. The information set forth herein has been obtained from the County, The Depository Trust
Company, Ambac Assurance Corporation, and other sources which are believed to be reliable, but is not
guaranteed as to accuracy or completeness, and is not to be construed as a representation by the County
with respect to any information provided by others. The information and expressions of opinion stated
herein are subject to change, and neither the delivery of this Official Statement nor any sale made
hereunder shall create, under any circumstances, any implication that there has been no change in the
matters described herein since the date hereof.
IN CONNECTION WlTH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR
EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF TIlE SERIES
2003 BONDS AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
All summaries herein of documents and agreements are qualified in their entirety by reference to
such documents and agreements, and all summaries herein of the Series 2003 Bonds are qualified in their
entirety by reference to the form thereof included in the aforesaid documents and agreements.
NO REGISTRATION STATEMENT RELATING TO THE SERIES 2003 BONDS HAS BEEN FILED
WlTH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION") OR WlTH ANY
STATE SECURITIES COMMISSION. IN MAKING ANY INVESTMENT DECISION, INVESTORS MUST
RELY ON THEIR OWN EXAMINATIONS OF THE COUNTY AND THE TERMS OF THE OFFERING,
INCLUDING THE MERITS AND RISKS INVOLVED. THE SERIES 2003 BONDS HAVE NOT BEEN
APPROVED OR DISAPPROVED BY THE COMMISSION OR ANY STATE SECURITIES COMMISSION
OR REGULATORY AUTHORITY. THE FOREGOING AUTHORlTlES HAVE NOT PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS OFFICIAL STATEMENT. ANY REPRESENTATION TO THE
CONTRARY MAY BE A CRIMINAL OFFENSE.
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TABLE OF CONTENTS
Contents
Page
INTRODUC1l0N .................. ........................... ...................................................................... ........ ............................1
General..... .............. ......... ................. ............. .................. ........ ......................... ................... ................................ ....1
The County............ ......... .......... .................. ........ ...... .............. ....................... ................... .......... ............ ..... ...........1
Purpose of the Series 2003 Bonds ........................................................................................................................1
Security for the Bonds.. .............................. .......... ....... ......... ................................ ........... ........ ................ ..............2
Redemption Provisions......... ............ .............. ............... ....................... ............. .......... ........................... ..............2
Financial Guaran ty Insurance.... .................. ..... ............ ............... ......... ............ ............... ....................................2
Addi tional Pa ri ty Bonds. .................... ...... ...... ........................ ................ ................... ......................... ...... ............2
Tax Exemption ......... ........... .......... ...... ........... ................ .......... .............. ........ .............. ...... .................. ............. .....2
Continuing DiscJosu re .... ............. ..... ........ ............ ..... ............ .............. ......... ....... ............. .................. ...... ....... .....3
Amendment of Resolu tion........... ............. ............ ...... ......... .................. ........ ................... ........... .........................3
Addi tional Information.............. ........ ....... ........... ................... ......... ............ ...... ............ ......... ...... ............. ...........3
A UTHORITY FOR ISSUANCE.......................................................................................... ....... ................ ........ ........ 3
TH E PROJ ECT.. ...... ....... ........ ........ ............. ... ............. .......... .... ............. ...... ...... ........ ....... ........... .......... ......... ......... ....4
PLAN OF REFUN 01 N G ..... .................... ..... ..... ........ ....... ...... ......... ..... .......... ......... ................... ........... ......... ............4
DESCRIPTION OF THE SERIES 2003 BONDS.......................................................................................................5
General... ............ ........ .............. ............ .................. ....... ................... ......... ....................... ............... .......... ..............5
Book-Entry Only System... ... .............. ............. ..... ........ ..... ............ ........ ............................... ........ ........... ......... .....5
Payment of the Series 2003 Bonds .......................................................................................................................7
Ownership of Series 2003 Bonds..........................................................................................................................7
Optional Redemption................................................. ............. ............. ...... .......... .......... ............. ...... ............. .......7
Mandatory ].{edem ption........... ................. ............ ..... .......... .... ....... ..... ....... ........ ........... ........ ......... ............ .......... 8
Notice of Redem ption ................ ..... ...... ............ .................................. ...... ......... ........... ....... ......... .......... ...... ........8
Transfer and Exchange. .......... ............... ........... ............... .......................... ......... ..... ............. .......... ......... ........... ...8
SECURITY FOR THE BONDS ..................................................................................................................................9
General. ............ ...... ........ .......... .., ......... ............... ........... .................. ......... ........ ........ .................... ..... ....... ...... ........ 9
Uniform Commercial Code ............ ................. ............ .............................. ....... ...... ............. ....... ............ ...... ......10
Funds and Accoun ts. ......... ........... ...... .... ........ .............. .............................. ..... ........ ...... ...... ...... ....... ....... ........ ....1 0
Construction Fund ............. ............. ............. ........ ......... ......... .......................... ................ ................................ ....1 0
Reserve Account ... ............ ......... ..... ........................... ............. ............... ......... ......... ......... .......... ................... ......11
Disposition of Sales Tax Revenues ....................................................................................................................11
Additional Pari ty Bonds............ ............ .... ............. .......... .................. ................... ........ ........... ...... ............ ........13
Subordinated Indebtedness...... ............,.... .'.......... ........... .................................. ................... ......... ,..... ....... ...... .14
Books and Records............ ............ .......... ........... .............. ..... ..................... ...................................... ....... .............14
Collection of Sales Tax Revenues; No Impairment .........................................................................................14
Investments...... ............. ............ ............. .............. ............. ..... .................... ......... ......................... ............ ........ .....14
Amendment of Resolution without Consent of Bondholders; Control by Insurer in Case of Event of
Defaul t...... ........ ........... .............. ............. ............... ............ ................................................... ................. .......... ......15
SALES TAX REVENUES ................................................. ................... .... ................... ..................... .........................15
General............. ........................ ...................... ................. ......... ................. ................ ............................. ........ .......15
Eligibility...................... ............ .................................. ............................................. ...... ............................. ........ ...16
Distribu tion...... ............ ................... .................. ..._.......... ........ ........... ..................... .................. ......................... ...17
Recent Legislative Amendment .................................. .................................................................................. .....18
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ESTIMATED SOURCES AND USES OF FUNDS ................................................................................................20
DEBT SERVICE SCHEDULE ......................... ....... ....... ............ .................. .................................... ........ ......... ........ 21
FIN ANCIAL GUARANTY INSURANCE .................................. ..................... ......................... ............................. 22
Payment Pursuant to Bond Insurance Policy...................................................................................................22
A mbac Assurance Corpora Hon.......... ....... ......................... .............. .................................... ............... ............ ...23
Available Information ... ....................................... ....................................... ........ .......................................... ......23
Incorporation of Certain Documents by Reference.........................................................................................24
2003 RESERVE ACCOUNT INSURANCE POLICY ............................................................................................25
2002 RESERVE ACCOUNT INSURANCE POLICY ............................................................................................26
INVESTMENT POLICY ........................................................................ .............................................. ..................... 28
LEGAL MA TIERS.......................... ......................... ................. .......................................... ......................................30
LITIGATION. ...................... ........ ......... ........ .......... ............................ ....... ............. ............................... ...... ........ ...... 30
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS ...........................................................3]
TAX EX EMPTION ..... ............... ....................... ............ ................. ........... ....... ..................... ......... ........ ........... ......... 32
Opinion of Bond Counsel................. .... ..... .............. ......... .... ............ .............. ...... .................. ......... ...... ........... ..32
Internal Revenue Code of 1986 ..........................................................................................................................32
Collatera I Tax Consequences. .... .............. ............. ....... ....... ....... ............. ........... ...................... ......... ............. ....32
Florida Taxes.. ............ ............. ................. ......... ............. ....... ....... ...... ...... ........ ........... ....... ...... ............ ........ ....... .33
(1ther Tax Matters. ........... ....... ....... .......................... .................. ......... ................... .......... ........ ................ ........... .33
Tax Treatment of Original Issue Discount........................................................................................................33
Tax Treatment of Bond Premium ......................................................................................................................34
RA TI NGS ................ ........................ ............. ................ ............. .............. .................. ......................... .......... ........ ...... 34
VERIFICATION OF MATHEMATICAL COMPUT A TIONS.............................................................................34
FIN AN CIA L A DV ISOR .............. ......... ...................................................... ......... .......................................... ...........35
AUDITED FIN ANCIAL STATEMENTS ............................................. ..................................................................35
UN DER WRITIN G .... .......... ............. ..... ............. ........ ........................... -.... .................. ......... .............. ......... ....... ......35
CONTINGENT FEES ........ ............ ............... ........... .............. .......................... ................... ..............................., ...... 35
EN FORC EA BILITY OF REMEDIES.... ............. ............ ..... .......... ... .......... .......... ......... ........... ...... ........ ........... ....... 36
CONTINUING DISCLOSURE........... ................................................................. ............ ........................................36
ACCURACY AND COMPLETENESS OF OFFICIAL STATEMENT................................................................36
AUTHORIZATION OF OFFICIAL STATEMENT .................. .............................................................................37
APPENDIX A - GENERAL INFORMATION REGARDING COLLIER COUNTY, FLORIDA
APPENDIX B - AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED SEPTEMBER 30,
2002
APPENDIX C - SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION
APPENDIX 0 - FORM OF BOND INSURANCE POLICY
APPENDIX E - FORM OF 2003 RESERVE ACCOUNT INSURANCE POLICY
APPENDIX F - 2002 RESERVE ACCOUNT INSURANCE POLICY
APPENDIX G - FORM OF BOND COUNSEL OPINION
APPENDIX H - FORM OF CONTINUING DISCLOSURE CEKrIFICATE
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..... .,.,
OFFICIAL STATEMENT
relatillg to
$54,370,000*
COLLIER COUNTY, FLORIDA
Capital Improvement and Refunding Revenue Bonds,
Series 2003
INTRODUCTION
General
This introduction is subject in all respects to the more complete information and definitions
contained or incorporated in this Official Statement and should not be considered to be a complete
statement of the facts material to making an informed investment decision. The offering by Collier
County, Florida (the "County"), of its $54,370,000* Capital Improvement and Refunding Revenue Bonds,
Series 2003 (the "Series 2003 Bonds") to potential investors is made only by means of the entire Official
Statement, including all appendices attached hereto. All capitalized undefined terms used in this
introduction shall have the meaning set forth in "APPENDIX C - SUMMARY OF CERTAIN
PROVISIONS OF THE I\ESOLUTION" attached hereto.
The County
The County was established in 1923 by the legislature of the State of Florida (the "State") from
portions of Lee and Monroe Counties. Its territorial limits, as they presently exist, contain approximately
2,026 square miles. In terms of land area, it is the largest county in the State. The County is located on the
southwest coast of the Florida peninsula directly west of the Miami-Fort Lauderdale area. In 2002, the
County had a population of 264,475. Principal industries within the County include wholesale and retail
trade, tourism, agriculture, forestry, fishing, cattle ranching and construction. The 2000 U.s. Census
showed an increase in the population of the County of 65% between the years 1990 and 2000. Part of the
Everglades National Park, the United States' only subtropical national park, comprises a portion of the
County. See "APPENDIX A - GENERAL INFORMATION REGARDING COLLIER COUNTY,
FLORIDA" attached hereto for more information about the County.
Purpose of the Series 2003 Bonds
The County proposes to issue the Series 2003 Bonds for the purpose of providing funds, together
with other legally available funds of the County, to (i) reimburse or finance the costs of acquisition,
construction and equipping of various capital improvements within the County including, but not
limited to, acquisition, construction and equipping of a County Jail Complex and the County
Development Services Building expansion and associated parking garage, (ii) refund, on a current basis,
all of the County's then outstanding Capital Improvement Revenue Refunding Bonds, Series 1992 (the
"Refunded Bonds"), and (iii) pay certain costs of issuance of the Series 2003 Bonds, including the
municipal bond insurance premium and the reserve account insurance policy premium. The Series 2003
Bonds will be issued on a parity as to the lien on and security with the County's Capital Improvement
Revenue Refunding Bonds, Series 1994 currently outstanding in the principal amount of $
* Preliminary, subject to change
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and the County's Capital Improvement Revenue Bonds, Series 2002 currently outstanding in the principal
amount of $ (collectively, the "Outstanding Parity Bonds"). The Series 2003 Bonds, the
Outstanding Parity Bonds, and any Additional Parity Bonds (as defined in the hereinafter described
Resolution) subsequently issued pursuant to the Resolution (as hereinafter defined) are herein
collectively referred to as the "Bonds." See "SECURITY FOR THE BONDS - Additional Parity Bonds"
herein.
Security for the Bonds
Pursuant to Resolution No. 85-107 adopted by the Board of County Commissioners (the "Board")
of the County on April 30, 1985, as amended and supplemented from time to time, and as particularly
supplemented by Resolution No. 03-_ adopted by the Board on September 23, 2003 (collectively, the
"Resolution"), the Series 2003 Bonds will be payable from and will be secured by, on a parity with the
Outstanding Parity Bonds and any Additional Parity Bonds subsequently issued pursuant to the
Resolution, the proceeds of the local government half-cent sales tax, as defined and described in, and
distributed to the County under Chapter 218, Part VI, Florida Statutes ("Sales Tax Revenues") and all
investment income derived from the investment of moneys in the Reserve Account established by the
Resolution, if any (collectively, the "Pledged Revenues"). See "SALES TAX REVENUES" herein. Pursuant
to the Resolution, upon the issuance of the Series 2003 Bonds, there will be on deposit in the Reserve
Account two reserve account insurance policies an amount equal to the Maximum Bond Service
Requirement with respect to the Series 2(XJ3 Bonds and the Outstanding Parity Bonds. See "SECURITY
FOR THE BONDS," "2003 RESERVE ACCOUNT INSURANCE POLICY" and "2002 RESERVE ACCOUNT
INSURANCE POLICY" herein.
Redemption Provisions
The Series 2003 Bonds are subject to optional and mandatory redemption prior to their stated
maturities as described herein. See "DESCRIPTION OF THE SERIES 2003 BONDS" herein.
Financial Guaranty Insurance
Payment of the principal of and interest on the Series 2003 Bonds when due will be insured by a
financial guaranty insurance policy (the "Bond Insurance Policy") to be issued by Ambac Assurance
Corporation (the "Insurer") simultaneously with the delivery of the Series 2003 Bonds. See "FINANCIAL
GUARANTY INSURANCE" herein.
Additional Parity Bonds
The County may issue Additional Parity Bonds on a parity with the Series 2003 Bonds and the
Outstanding Parity Bonds, subject to compliance with certain conditions set forth in the Resolution. See
"SECURITY FOR THE BONDS - Additional Parity Bonds" herein.
Tax Exemption
In the opinion of Nabors, Giblin & Nickerson, P.A., Tampa, Florida, Bond Counsel, interest on the
Series 2003 Bonds is, under existing statutes, regulations, rulings and court decisions: (a) excludable from
gross income for federal income tax purposes except as otherwise described herein under the caption
"TAX EXEMPTION" and (b) not an item of tax preference for purposes of the federal alternative
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minimum tax imposed on individuals and corporations. Such interest, however, will be includable in the
calculation of a corporation's alternative minimum taxable income and may be subject to other federal
income tax consequences referred to herein under the caption "TAX EXEMPTION." Bond Counsel is
further of the opinion that the Series 2003 Bonds and the interest thereon are exempt from all present
intangible personal property taxes imposed pursuant to Chapter 199, Florida Statutes. See "TAX
EXEMPTION" herein for a discussion of Bond Counsel's opinion, including a discussion of the corporate
alternative minimum tax.
Continuing Disclosure
The County has agreed and undertaken, for the benefit of Series 2003 Bondholders, to provide
certain financial information and operating data relating to the County, the Pledged Revenues and the
Series 2003 Bonds pursuant to Rule 15c2-12 of the Securities and Exchange Commission. See
"CONTINUING DISCLOSURE" herein.
Amendment of Resolution
Pursuant to the Resolution, the County is granted the right to make certain amendments to the
Resolution without the consent of the Holders of the Series 2003 Bonds. See "APPENDIX C - SUMMARY
OF CEKrAIN PROVISIONS OF THE RESOLUTION" attached hereto.
Additional Information
This Official Statement speaks only as of its date, and the information contained herein is subject
to change. This Official Statement contains certain information concerning the Insurer, its Bond
Insurance Policy on the Series 2003 Bonds and its 2003 reserve account insurance policy, and contains
certain information concerning The Depository Trust Company, New York, New York ("DTC"), and its
book-entry-only system of registration. Such information has not been provided by the County and the
County does not certify as to the accuracy or sufficiency of the disclosure practices or content of
information provided by such parties and is not responsible for the information provided by such parties.
A copy of the Resolution and all documents of the County referred to herein may be obtained
from Dwight E. Brock, Clerk of Circuit Court and Chief Financial Officer of Collier County, Government
Complex, 3301 East Tamiami Trail, Building L, Naples, Florida 34112, Phone (239) 732-2646.
Capitalized terms used but not defined herein have the same meaning as when used in the
Resolution unless the context clearly indicates otherwise. See "APPENDIX C - SUMMARY OF CERTAIN
PROVISIONS OF THE RESOLUTION" attached hereto. All information included herein has been
provided by the County, except where attributed to other sources. Copies of such documents, reports
and statements referred to herein that arc not included in their entirety in this Official Statement may be
obtained from the County.
AUTHORITY FOR ISSUANCE
The Series 2003 Bonds arc being issued pursuant to the authority of and in full compliance with
the Constitution and laws of the State of fllorida, including Chapter ]25, Florida Statutes, as amended and
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supplemented, Home Rule Ordinance No. 82-47 duly enacted by the Board on June 18, 1982, and other
applicable provisions of law (the "Act"), and pursuant to the Resolution.
THE PROJECT
The Project consists of the acquisition, construction and equipping of various capital
improvements within the County including, but not limited to, acquisition, construction and equipping
of a County Jail Complex and the County Development Services Building expansion and associated
parking garage (collectively, the "Project").
PLAN OF REFUNDING
Concurrently with the delivery of the Series 2003 Bonds, a portion of the proceeds of the Series
2003 Bonds, together with other legally available funds of the County, shall be deposited into an esero"...
deposit trust fund (the "Escrow Fund") pursuant to the terms and provisions of the Escrow Deposit
Agreement between the County and Fifth Third Bank, Cincinnati, Ohio, as Escrow Holder (the "Escrow
Agreement"). The moneys deposited pursuant to the Escrow Agreement shall be applied to the purchase
of Obligations of the United States of America (as such term is defined in the Resolution), so as to
produce sufficient funds to pay the principal of, redemption premium, and interest on the Refunded
Bonds, as the same become due and payable, whether at maturity or redemption prior to maturity. The
Refunded Bonds are expected to be redeemed on November 25,2003 at a redemption price equal to 101 %
of the principal amount thereof plus interest accrued to the redemption date. See "VERIFICATION OF
MATHEMATICAL COMPUTATIONS" herein.
The deposit of such moneys and investment thereof, in the opinion of Bond Counsel and in
reliance on the Verification Report of Causey Demgen & Moore Inc., Denver, Colorado, will cause the
pledge of the Pledged Revenues and all covenants, agreements and other obligations of the County to the
holders of the Refunded Bonds to cease, terminate and become void and be discharged and satisfied. The
holders of the Refunded Bonds shall be entitled to payment solely out of the moneys or Obligations of the
United States of America deposited pursuant to the Escrow Agreement. The moneys and Obligations of
the United States of America on deposit in the Escrow Fund will not be available for payment of the
Series 2003 Bonds.
The County's Capital Improvement Revenue Refunding Bonds, Series 1992 which mature on
October 1, 2003 shall be regularly paid by the County at maturity without premium.
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DESCRIPTION OF THE SERIES 2003 BONDS
General
The Series 2003 Bonds will be dated and will mature in the years, and in the amounts and bear
interest at the rates and be payable on the dates set forth on the cover page hereof. Interest on the Series
2003 Bonds is payable on April 1, 2004, and semiannually on each October 1 and April 1 thereafter (each
an "Interest Date"). Principal of, premium, if any, and interest on the Series 2003 Bonds wiII be payable
by Fifth Third Bank, Cincinnati, Ohio, as Paying Agent and Registrar.
Book-Entry Only System
THE FOLLOWING INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY
("DTC') AND DTCS BOOK-ENTRY ONLY SYSTEM HAS BEEN OBTAINED FROM SOURCES THAT
THE COUNTY BELIEVES TO BE RELIABLE, BUT THE COUNTY TAKES NO RESPONSIBILITY FOR
THE ACCURACY THEREOF.
DTC will act as securities depository for the Series 2003 Bonds. The Series 2003 Bonds will be
registered in the name of Cede & Co. (DTCs partnership nominee). Purchases of beneficial ownership
interests in the Series 2003 Bonds will be made in book-entry only form, in the denominations
hereinbefore described. Purchasers of beneficial ownership interests in the Series 2003 Bonds ("Beneficial
Owners") will not receive bond certificates representing their ownership interests in the Series 2003
Bonds, except in the event that use of the book-entry only system for the Series 2003 Bonds is
discontinued. One fully registered certificate will be issued for each maturity of the Series 2003 Bonds
and deposited with DTe.
DTC, the world's largest depository, is a limited-purpose trust company organized under the
New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17 A
of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 2 million issues
of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments
from over 85 countries that DTC's participants (the "Direct Participants") deposit with DTe. DTC also
facilitates the post-trade settlement among Direct Participants of secu rities transactions, in deposited
securities, through electronic computerized book-entry transfers and pledges between Direct Participants'
accounts. This eliminates the need for physical movement of securities certificates. Direct Participants
include both U.S. and non-U.s. securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository
Trust and Clearing Corporation ("DTCC"). DTCC, in turn is owned by a number of Direct Participants of
DTC and Members of the National Securities Clearing Corporation, Government Securities Clearing
Corporation, MBS Clearing Corporation, and Emerging Markets Clearing Corporation, as well as by the
New York Stock Exchange, Inc., the American Stock Exchange LLC and the National Association of
Securities Dealers, Inc. Access to the DTC system is also available to others such as both U.s. and non-
u.s. securities brokers, dealers, banks, trust companies and clearing corporations that clear through or
maintain a custodial relationship with a Direct Participant, either directly or indirectly (the "Indirect
Participants"). DTC has Standard and Poor's highest rating: AAA. The DTC rules applicable to DTC and
its Direct and Indirect Participants are on file with the Securities and Exchange Commission. More
information about DTC can be found at www.dtcc.com.
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Purchases of Series 2oo3 Bonds under the DTC system must be made by or through Direct
Participants, which will receive a credit for such Series 2003 Bonds on DTC's records. The ownership
interest of each actual purchaser of each Series 2003' Bond (the "Beneficial Owner") is in turn to be
recorded on the Direct and Indired Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchase. Beneficial Owners arc, however, expected to receive written
confirmations providing details of the transaction, as well as periodic statements of their holdings, from
the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction.
Transfers of ownership interests in the Series 2003 Bonds are to be accomplished by entries made on the
books of Direct and Indirect Participants acting on behalf of the Beneficial Owners. Beneficial Owners
will not receive certificates representing their beneficial interests in the Series 2003 Bonds, except in the
event that use of the book-entry system for the Series 2003 Bonds is discontinued.
To facilitate subsequent transfers, all Series 2003 Bonds deposited by Direct Participants with
DTC are registered in the name of DTC's partnership nominee, Cede & Co. or such other name as may be
requested by an authorized representative of DTC The deposit of Series 2003 Bonds with DTC and their
registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2003 Bonds. DTe's
records reflect only the identity of the Direct Participants to whose accounts such Series 2003 Bonds are
credited, which mayor may not be the Beneficial Owners. The Direct and Indirect Participants will
remain responsible for keeping an account of their holdings on behalf of their customers.
Conveyance of notices and other communications by OTe to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements made among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Redemption notices shall be sent to DTC If less than
all of a maturity of the Series 2003 Bonds are being redeemed, DTe's practice is to determine by lot the
amount of the interest of each Direct Participant in such Series 2oo3 Bonds, as the case may be, to be
redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to
the Series 2003 Bonds unless authorized by a Direct Participant in accordance with DTe's procedures.
Under its usual procedures, DTC mails an Omnibus Proxy to the County as soon as possible after the
record date. The Omnibus Proxy assigns Cede & CO.'5 consenting or voting rights to those Direct
Participants to whose accounts the Series 2003 Bonds are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
Principal and interest payments on the Series 2003 Bonds will be made to DTC DTC's practice is
to credit Direct Participants' accounts, upon DTC's receipt of funds and corresponding detail information
from the County, or the Registrar on the payable date in accordance with their respective holdings shown
on DTC's records. Payments by Direct or Indirect Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the case with securities held for the accounts of
customers in bearer form or with securities held for the accounts of customers in bearer form or
registered in "street name," and will be the responsibility of such Direct or Indirect Participants and not of
DTC, the Registrar, the Paying Agent, or the County, subject to any statutory and regulatory
requirements as may be in effect from time to time. Payment of principal and interest to DTC is the
responsibility of the County and/or the Paying Agent for the Series 2003 Bonds. Disbursement of such
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payments to Direct Participants is the responsibility of DTC and disbursement of such payments to the
Beneficial Owners is the responsibility of the Direct and Indirect Participants.
DTC may discontinue providing its services as securities depository with respect to the Series
2003 Bonds at any time by giving reasonable notice to the County. Under such circumstances, in the
event that a successor securities depository is not obtained, certificates are required to be printed and
delivered.
The County may decide to discontinue use of the system of book-entry transfers through OTC (or
a successor securities depository). In that event, certificates will be printed and delivered.
Payment of the Series 2003 Bonds
Interest on the Series 2003 Bonds is payable by the Paying Agent by check or draft mailed to the
holder in whose name such Series 2003 Bond shall be registered at the close of business on the date which
shall be the fifteenth day of the calendar month next preceding each Interest Date, whether or not such
day is a business day, or at the request of such holder, by bank wire transfer to the account of such
holder. The principal of and premium, if any, on the Series 2003 Bonds is payable at maturity or
redemption to the registered owner at the designated corporate trust office of the Paying Agent.
For so long as the Series 2003 Bonds shall be held in the OTC book-entry system (without
certificates), all such payments of principal of, redemption premium, if any, and interest on the Series
2003 Bonds will be made to Cede & Co., as registered owner thereof, by the Paying Agent and payments
to Beneficial Owners will be the responsibility of DTC and the OTC Participants. See "DESCRIPTION OF
THE SERIES 2003 BONDS - Book-Entry Only System" herein.
Ownership of Series 2003 Bonds
The County, the Paying Agent, and the Registrar shall deem and treat the person in whose name
any Series 2003 Bond is registered on the books maintained by the Registrar as the absolute owner of such
Series 2003 Bond, whether or not such Series 2003 Bond is overdue, for the purpose of receiving payment
thereof and for all other purposes whatsoever, and neither the County, the Paying Agent, nor the
Registrar will be affected by any notice to the contrary. All such payments wi\l be valid and effectual to
satisfy and discharge the liability upon such Series 2003 Bond to the extent of the sum or sums so paid.
Optional Redemption
The Series 2003 Bonds maturing prior to October 1, 2014 are not subject to optional redemption
prior to maturity. The Series 2003 Bonds maturing on or after October 1, 2014 are subject to redemption
prior to their respective maturities, at the option of the County on or after October I, 2013, as a whole or
in part at any time, and if in part, by maturities to be selected by the County and by lot within a maturity
if less than a full maturity, at a redemption price equal to 100% of the principal amount of the Series 2003
Bonds to be redeemed plus accrued interest to the date fixed for redemption.
[Remainder of page intentionally left blank]
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Mandatory Redemption
The Series 2003 Bonds maturing on October 1, 20_-, are subject to mandatory sinking fund
redemption, prior to maturity in part, by lot on October 1, 20_ and on each October] thereafter, at a
redemption price equal to the principal amount of such Series 2003 Bonds or portions thereof to be
redeemed, plus interest accrued thereon to the date of redemption, on October 1 in the following years
and in the following Amortization Installments:
Year
Amortization Installments
20_
20_
20_
20_"
$
"Maturity
Notice of Redemption
Notice of redemption shall be (i) filed with the Paying Agent and Registrar; and (ii) mailed, first
class, postage prepaid, at least 30 days prior to the redemption date to all registered owners of Series 2003
Bonds to be redeemed at their addresses as they appear on the registration books of the County. Interest
shall cease to accrue on any Series 2003 Bond duly called for redemption on the redemption date,
provided provision for the payment thereof shall have been duly provided. Failure to mail notice to the
registered owners of the Series 2003 Bonds to be redeemed, or any defect in such notice, shall not affect
the proceedings of redemption of such Series 2003 Bonds.
As described above under "DESCRIPTION OF THE SERIES 2003 BONDS -- Book-Entry Only
System," for so long as the Series 2003 Bonds are registered in the name of DTC or its nominee, notice of
redemption of any Series 2003 Bond will be given by the Registrar to [)TC or such nominee only, who
will then be solely responsible for selecting and notifying those DTC Participants and Beneficial Owners
(as defined herein) to be affected by such redemption.
Transfer and Exchange
So long as the Series 2003 Bonds are registered in the name of DTC or its nominee, the following
paragraphs relating to transfer and exchange of Series 2003 Bonds du not apply to the Series 2003 Bonds,
Series 2003 Bonds, upon surrender thereof at the office of the Registrar with a written instrument
of transfer satisfactory to the Registrar, duly executed by the registered owner or his attorney duly
authorized in writing, may, at the option of the registered owner thereof, be exchanged for an equal
aggregate principal amount of registered Series 2003 Bonds and of the same maturity of any other
authorized denominations. The Registrar shall act as registrar and transfer agent for all Series 2003
Bonds.
The Series 2003 Bonds issued under the Resolution shall be and have all the qualities and
incidents of negotiable instruments under the law merchant and the Uniform Commercial Code of the
State of Florida, subject to the provisions for registration and transfer contained in the Resolution and in
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the Series 2003 Bonds. So long as any of the Series 2003 Bonds shall remain outstanding, the County shall
maintain and keep. at the office of the Registrar, books for the registration and transfer of the Series 2003
Bonds; and, upon presentation thereof for such purpose at said office, the County shall register or cause
to be registered therein, and permit to be transferred thereon, under such reasonable regulations as it or
the Registrar may prescribe, any Series 2003 Bond entitled to registration or transfer.
Each Series 2003 Bond shall be tnmsferable only upon the books of the County, at the office of the
Registrar, by the registered owner thereof in person or by his attorney duly authorized in writing upon
surrender thereof together with a written instrument of transfer satisfactory to the Registrar duly
executed by the registered owner or his duly authorized attorney. Upon the transfer of any such Series
2003 Bond, the County shall issue in the name of the transferee a new Series 2003 Bond or Series 2003
Bonds of the same aggregate principal amount and maturity as the surrendered Series 2003 Bond.
The County and any paying agent or fiduciary of the County may deem and treat the person in
whose name any outstanding Series 2003 Bond shall be registered upon the books of the County as the
absolute owner of such Series 2003 Bond, whether such Series 2003 Bond shall be overdue or not, for the
purpose of receiving payment of, or on account of, the principal, redemption premium, if any, and
interest on such Series 2003 Bond Lind for all other purposes, and all such payments so made to any such
registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon
such Series 2003 Bond to the extent of the sum or sums so paid and neither the County nor any paying
agent or other fiduciary of the County shall be affected by any notice to the contrary.
In all cases in which the privilege of exchanging Series 2003 Bonds or transferring Series 2003
Bonds is exercised, the County shall execute and deliver Series 2003 Bonds in accordance with the
provisions of the Resolution. Execution of Series 2003 Bonds by the Chairman and Clerk for purposes of
exchanging, replacing or transferring Series 2003 Bonds may occur at the time of the original delivery of
the Series 2003 Bonds. All Series 2003 Bonds surrendered in any such exchanges or transfers shall be held
by the Registrar in safekeeping until directed by the County to be cancelled by the Registrar. For every
such exchange or transfer of Series 2003 Bonds, the County or the Registrar may make a charge sufficient
to reimburse it for any tax, fee, expense or other governmental charge required to be paid with respect to
such exchange or transfer. The County shall not be obligated to make any such exchange or transfer of
Series 2003 Bonds during the fifteen (15) days next preceding an interest payment date on the Series 2003
Bonds, or in the case of any proposed redemption of Series 2003 Bonds, then during the fifteen (15) days
next preceding the date of the first mailing of notice of such redemption and continuing until such
redemption date.
SECURITY FOR THE BONDS
General
The principal of, redemption premium, if any, and interest on Bonds issued under the Resolution,
including the Series 2003 Bonds, the Outstanding Parity Bonds, and any Additional Parity Bonds
hereafter issued, will be payable on a parity with one another from and secured by a pledge of and first
lien upon (i) the proceeds of the local government half-cent sales tax, as defined and described in, and
distributed to the County under Chapter 218, Part Vl, Florida Statutes (the "Sales Tax Revenues"), and (ii)
the investment income derived from the investment of moneys in the Reserve Account established under
the Resolution, if any ("Investment Earnings") which shall be transferred to the Sinking Fund in
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accordance with the Resolution (collectively, the "Pledged Revenues"). For more information regarding
Sales Tax Revenues, see "SALES TAX REVENUES" herein.
THE SERIES 2003 BONDS SHALL NEITHER CONSTITUTE GENEI{AL INDEBTEDNESS OF
THE COUNTY NOR A PLEDGE OF ITS FULL FAITH, CREDIT OR TAXING POWER WITHIN THE
MEANING OF ANY CONSTITUTION AL OR STATUTORY PROVISION OR LIMIT A TION, BUT SIIALL
BE PAYABLE SOLELY FROM AND SECURED BY A LIEN UPON AND PLEDGE OF THE PLEDGED
REVENUES AS PROVIDED IN THE RESOLUTION. NO HOLDEI{ OR HOLDERS OF THE SERIES 2003
BONDS SHALL EVER HAVE THE RIGHT TO REQUIRE OR COMPEL THE EXERCISE OF THE AD
V ALOREM TAXING POWER OF THE COUNTY TO PAY TH E SERIES 2003 BONDS OR THE INTEREST
THEREON OR TO MAKE ANY SINKING FUND, I{ESERVE ACCOUNT OR OTHER PAYMENTS
PlmVIDED IN THE RESOLUTION. THE SEI{IES 2003 BONDS AND TilE INDEBTEDNESS
EVIDENCED THEREBY SHALL NOT CONSTITUTE A LIEN UPON THE PROJECT OR ANY OTHER
PROPERTY OF THE COUNTY, BUT SHALL CONSTITUTE A LIEN UPON THE PLEDGED REVENUES
TO THE EXTENT AND IN THE MANNEI{ PROVIDED IN THE RESOLUTION.
Uniform Commercial Code
The Series 2003 Bonds will have all the qualities and incidents of an investment security under
the Uniform Commercial Code-Investment Securities Law of the State of Florida and the County's pledge
of the Pledged Revenues is exempt from the provisions of such law relating to perfection of security
interests relating to secured transactions.
Funds and Accounts
The County covenanted and agreed in the Resolution to establish with a bank or trust company
in the State of Florida, which is eligible under the laws of such State to receive County funds, special
funds to be known as the "Sales Tax Fund," the "Rebate Fund," the "Sinking Fund," and within the Sinking
Fund, the "Interest Account," the "Principill Account," the "Bond Amortization Account;' and the "Reserve
Account," and the "Construction Fund." Such Funds and Accounts constitute trust funds for the purposes
provided in the Resolution for such Funds and Accounts. All such Funds and Accounts shall be
continuously secured in the manner by which the deposit of public funds are authorized to be secured by
the Laws of the State of Florida.
Construction Fund
The moneys in the Construction Fund, until applied for payment of any item of the Cost of the
Project in the manner provided in the Resolution, shall be held in trust by the County and shall be subject
to a lien and charge in favor of the Holders of the Bonds and for the further security of such Holders.
The County covenanted and agreed in the Resolution to commence ilnd proceed with completion
of the Project with due diligence and all practicable dispatch. If for any f(:'ilson such proceeds or any part
thereof are not necessary for or are not applied to the payment of such Cost, then the unapplied proceeds
shall be deposited by the County into the Reserve Account in iln amount equal to any deficiency therein
and thereafter the unapplied proceeds shall be deposited, at the discretion of the County, into the Interest
Account or Principal Account and applied to the payment of principal of and interest on the Bonds.
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All income derived from investment of moneys in the Construction Fund shall be retained in the
Construction Fund; provided, that upon certification by the County Representative that the balance of
funds on deposit and a stated amount of income to be received on investments will be sufficient to pay all
remaining Cost of the Project when due, the balance of such investment income shall be deposited in the
Sinking Fund as described in the preceding paragraph.
All expenditures or disbursements from the Construction Fund shall be made only after such
expenditures or disbursements shall have been approved in writing by the County Representative. .rne
date of completion of the Project shall be determined by the County Representative who shall certify such
fact in writing to the Board.
Reserve Account
Upon the issuance of the Series 2003 Bonds, there shall be on deposit in the Reserve Account a
sum equal to the Maximum Bond Service Requirement for the Bonds ($ ), which sum shall be
maintained for the benefit of the holders of the Bonds. No further payments shall be required to be made
into the Reserve Account as long as the amount on deposit therein shall equal the Maximum Bond
Service Requirement on the outstanding Bonds. The Maximum Bond Service Requirement is defined in
the Resolution to be, as of any particular date of calculation, the greatest amount of aggregate Bond
Service Requirements for all outstanding Bonds for the then current or any future Bond Year. See
"APPENDIX C _ SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION" attached hereto.
Moneys in the Reserve Account shall be used only for the purpose of paying principal,
Amortization Installments and interest on the Bonds when moneys in the Sinking Fund are insufficient
therefore. Any moneys withdrawn from the Reserve Account must be restored from the first Pledged
Revenues available therefore after all required payments have been made for the payment of debt service,
including deficiencies for prior payments, on the Bonds on the next payment date.
The Maximum Bond Service Requirement will be satisfied in whole by two reserve account
insurance policies which will be on deposit in the Reserve Account upon the issuance of the Series 2003
Bonds. See "2003 RESERVE ACCOUNT INSURANCE POLICY" and "2002 RESERVE ACCOUNT
INSUI~ANCE POLICY" herein and "APPENDIX C - SUMMARY OF CERTAIN PROVISIONS OF THE
RESOLUTION" attached hereto for a description of the reserve account insurance policies which will be
on deposit in the Reserve Account following the issuance of the Series 2003 Bonds.
Disposition of Sales Tax Revenues
Pursuant to the I~esolution, the County promptly deposits upon receipt from the State the Sales
Tax Revenues into the Sales Tax Fund on or before the fifteenth day of each month, in the following
manner and in the following order of priority:
(1) The County shall deposit in the Interest Account the sum which, together with
Investment Earnings and with moneys therein not theretofore allocated to supplement any previous
monthly deposit, will be sufficient to pay one-sixth (1/6) of all interest becoming due on the Bonds on the
next semi-annual interest payment date. Moneys in the Interest Account shall be used to pay interest on
the Bonds as and when the same shall become due, and for no other purpose. All such payments, as
provided above, shall include an amount sufficient to pay the fees and charges of the Registrars and the
Paying Agents. Such monthly payments shall be increased or decreased proportionately to the extent
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required to pay interest becoming due each Bond Year, after making allowance for the amounts of
money, if any, which will be deposited in the Interest Account out of proceeds from the sale of the Bonds,
or which will be on deposit therein from other sources.
(2) On a parity with the deposits under paragraph (1) above the County shall next deposit in
the Principal Account the sum which, together with Investment Earnings and with moneys therein not
theretofore allocated to supplement any previous monthly deposit, will be sufficient to pay one-twelfth
(1/12) of all principal maturing on the Bonds which are serial bonds on the next maturity date. Moneys in
the Principal Account shall be used to pay the principal of the Bonds as and when the same shall mature,
and for no other purpose. Such monthly payments shall be increased or decreased proportionately to the
extent required to pay principal becoming due each Bond Year, after making allowance for the amounts
of money, if any, which will be on deposit in the Principal Account.
(3) On a parity with the deposits under paragraphs (1) and (2) above, the County shall next
deposit into the Bond Amortization Account, if and to the extent required, the sum which, together with
Investment Earnings and with moneys therein not theretofore allocated to supplement any previous
monthly deposit, will be sufficient to pay one-twelfth (1/12) of the redemption premium, if any, on such
Amortization Installment. Moneys in such Bond Amortization Account shall be used to purchase or
redeem Bonds which are term bonds in the manner provided in the Resolution, and for no other purpose.
(4) The County shall next deposit into the Reserve Account a sum sufficient to maintain
therein an amount equal to the Maximum Bond Service Requirement. Any withdrawals from the Reserve
Account shall be subsequent! y restored from the first Pledged Revenues available after all required
current payments for the Principal Account, the Interest Account and the Bond Amortization Account,
including all deficiencies for prior payments, have been made in full. Moneys in the Reserve Account
shall be used only for the purpose of the payment of maturing principal of or interest or Amortization
Installments on the Bonds when the other moneys in the Sinking Fund are insufficient therefor, and for
no other purpose. However, whenever the moneys on deposit in the Reserve Account exceed the
Maximum Bond Service Requirement, such excess may be withdrawn and deposited into the Principal
Account, the Interest Account or the Bond Amortization Account, at the discretion of the County.
Upon the issuance of any Additional Parity Bonds under the terms, limitations and conditions as
provided in the Resolution, the County shall increase the sum required to be accumulated and
maintained on deposit in the Reserve Account to be at least equal to the Maximum Bond Service
Requirement on all outstanding Bonds and on the Additional Parity Bonds becoming due in any ensuing
Bond Year. Such required sum may be paid in full or in part from the proceeds of such Additional Parity
Bonds or may be accumulated in equal monthly payments in the Reserve Account over a period of years,
not to exceed thirty-six months, from the date of delivery of the issuance of Additional Parity Bonds, as
determined by the Supplemental Resolution. In the event moneys in the Reserve Account are
accumulated as provided above, (a) the amount in said Reserve Account on the date of delivery of the
Additional Parity Bonds shall not be less than the Maximum Bond Service Requirement on all Bonds
outstanding on such date and (b) the incremental difference between the Maximum Bond Service
Requirement on all Bonds outstanding on the date of delivery of the Additional Parity Bonds and the
Maximum Bond Service Requirement on all such Bonds and the Additional Parity Bonds shall be fifty
percent funded upon delivery of the Additional Parity Bonds.
(5) Moneys held for the credit of the Bond Amortization Account shall be applied to the
retirement of the Term Bonds as follows:
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(a) Subject to the provisions of subparagraph (b) below, the County shall endeavor
to purchase or redeem Term Bonds then outstanding, at the most advantageous price obtainable
with reasonable diligence, such price not to exceed the principal of such Term Bonds plus the
amount of the redemption premium, if any, which would be payable on the next redemption
date to the Holders of such Term Bonds if such Term Bonds should be called for redemption on
such date from moneys in the Bond Amortization Account. The County shall pay the interest
accrued on such Term Bonds to the date of redemption or purchase thereof from the Interest
Account and the purchase price from the Bond Amortization Account, but no such purchase shall
be made by the County within the period of forty-five (45) days immediately preceding any
interest payment date on which such Term Bonds are subject to call for redemption except from
moneys in excess of the amounts set aside or deposited for the redemption of Term Bonds. As
soon as practicable after the 45th day preceding the due date of any such Amortization
Installment, the County shall proceed to call for redemption on such due date, by giving notice as
provided in the Resolution. Term Bonds of the Series and maturity for which such Amortization
Installment was established (except in the case of Term Bonds maturing on an Amortization
Installment date) in such amount as shall be necessary to complete the retirement of the
unsatisfied balance of such Amortization Installment.
(b) Moneys in the Bond Amortization Account shall be applied by the County in
each Bond Year to the retirement of the Term Bonds of each Series to the extent of the
Amortization Installment, if any, for such Bond Year for the Term Bonds of each such Series then
outstanding, plus the applicable redemption premium, and, if the amount available in such Bond
Year shall not be sufficient therefor, then in proportion to the Amortization Installment, if any,
for such Bond Year for the Term Bonds of each such Series then outstanding, plus the applicable
redemption premium.
(6) The balance of any Sales Tax Revenues remaining in the Sales Tax Fund after the above
required payments have been made may be transferred to the General Fund of the County and be used
for any lawful purpose.
(7) The County shall not be required to make any further deposits to any account in the
Sinking Fund when the aggregate of the sums deposited in the several accounts in the Sinking Fund
equals or exceeds the aggregate principal amount of all Bonds then outstanding and interest then accrued
thereon and which shall thereafter accrue thereon to the maturity thereof.
Additional Parity Bonds
The County may issue additional bonds ("Additional Parity Bonds") from time to time on a parity
with the Series 2003 Bonds and the Outstanding Parity Bonds subject to the satisfaction of certain
restrictive conditions set forth in the Resolution. Additional Parity Bonds shall only be issued by the
County for the construction and acquisition or completion of additional improvements and facilities of
the County or refunding the Bonds (in whole or in part) or obligations which are subordinate thereto.
Among other conditions, prior to the issuance of Additional Parity Bonds there shall be filed with the
County a certificate of an independent certified public accountant (i) stating that the books and records of
the County relating to the collection and receipt of Sales Tax Revenues have been audited by said
accountant; (ii) setting forth the amount of Sales Tax Revenues received by the County for any 12
consecutive month period within the 18 consecutive months immediately preceding the date of delivery
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of such Additional Parity Bonds with respect to which such certification is made; and (iii) stating that
Sales Tax Revenues received by the County for such 12 month period equal at least 1.35 times the
Maximum Bond Service Requirement on all Bonds then outstanding and the Additional Parity Bonds
with respect to which such certification is made. See "APPENDIX C - SUMMARY OF CERTAIN
PROVISIONS OF THE RESOLUTION -Issuance of Additional Parity Bonds" attached hereto.
Subordinated Indebtedness
The County may at any time or from time to time issue evidences of indebtedness which are not
Additional Parity Bonds payable in whole or in part out of the Pledged Revenues and which may be
secured by a pledge of the Pledged Revenues; provided, however, that such pledge shall be, and shall
contain an express statement that such obligations are junior and subordinate in all respects to the Bonds
as to lien on and source and security for payment from the Pledged Revenues.
Books and Records
The County will keep books and records of the receipt of the Pledged Revenues in accordance
with generally accepted accounting principles, and the Holders of not less than 5% of the aggregate
principal amount of the Bonds then outstanding shall have the right at all reasonable times to inspect the
records, accounts and data of the County relating thereto.
Collection of Sales Tax Revenues; No Impainnent
The County covenants to do all things necessary as required by the Act to maintain the levy and
the collection of the Sales Tax Revenues.
The pledging of the Pledged Revenues in the manner provided in the Resolution shall not be
subject to repeal, modification or impairment by any subsequent ordinance, resolution or other
proceedings of the Board; provided, however, see "SALES TAX REVENUES - Recent Legislative
Amendment" herein for a description of recent legislative changes.
Investments
The Construction Fund, the Sales Tax Fund, the Principal Account, the Interest Account, the
Reserve Account, the Bond Amortization Account and any other special funds or accounts established in
the Resolution and created shall constitute trust funds for the purposes provided in the Resolution for
such funds or accounts. All such funds and accounts shall be continuously secured in the manner by
which the deposit of public funds are authorized to be secured by the Laws of the State of Florida.
Moneys on deposit in the Construction Fund, the Sales Tax Fund and the Sinking Fund, except for the
Reserve Account, may be invested and reinvested, to the extent lawful, in Authorized Investments
maturing not later than the date on which the moneys therein will be needed. Moneys on deposit in the
Reserve Account may be invested and reinvested only in such obligations described in clauses (1)
through (4) of the definition of Authorized Investments in the I{esolution, provided they mature no later
than five (5) years from the date of investment. See "APPENDIX C -- SUMMARY OF CERTAIN
PROVISIONS OF THE RES01.UTION"' attached hereto. Prior to the date of completion of the Project, as
certified by the County Representative pursuant to the Resolution, any and all income received by the
County from the investment of moneys in the Construction Fund shall be retained in the Construction
Fund, except as otherwise provided in the Resolution. After such date of completion of the Project, any
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and all income received by the County from the investment of moneys in any account or fund created
pursuant to the Resolution, except the Reserve Account (to the extent the amount therein is greater than
the Maximum Bond Service Requirement), shall be retained in such respective fund or account. Any and
all income received by the County from the investment of moneys in the Reserve Account (to the extent
the amount therein is greater than the Maximum Bond Service Requirement) shall be deposited in such
account of the Sinking Fund as shall be determined by the County.
Amendment of Resolution without Consent of Bondholders;
Control by Insurer in Case of Event of Default
The County may enact one or more Supplemental Resolutions amending certain parts of the
Resolution with the written consent of the Insurer and the acknowledgment by said Insurer in lieu of
Bondholder consent relating to Bonds for which such Insurer has issued a Bond Insurance Policy as long
as such Insurer has not failed to honor its payment obligations thereunder. The foregoing right to amend,
however, does not apply to amendments to the Resolution with respect to the exemption of interest on
Bonds from Federal income taxation nor may any such amendment deprive the Holders of any Bond of
the right to payment of the Bonds from, and their lien on, the Pledged Revenues. Upon filing with the
Clerk of evidence of such consent of the Insurer, the County may adopt such Supplemental Resolution.
After the adoption by the County of such Supplemental Resolution, notice thereof shall be mailed in the
same manner as notice of an amendment under the ({esolution.
Upon the occurrence and continuance of an Event of Default, the Insurer, if such Insurer shall not
have defaulted under its Bond Insurance Policy, shall be considered to be the Holder of all Bonds to
which its Bond Insurance Policy relates (except for purposes of receipt of notices), and shall be entitled to
direct and control the enforcement of all rights and remedies with respect to such Bonds, including, with
limitation, any waiver of an Event of Default.
SALES TAX REVENUES
G eneraI
The State of Florida levies and collects a sales tax on, among other things, the sales price of each
item or article of tangible personal property sold at retail in the State of Florida, subject to certain
exceptions and dealer allowances. In 1982, the Florida legislature created the Local Government Half-
Cent Sales Tax Program (the "Half-Cent Sales Tax Program") which distributes a portion of the sales tax
revenue and money from the State's General Revenue Fund to counties and municipalities that meet strict
eligibility requirements. In 1982, when the I Ialf-Cent Sales Tax Program was created, the general rate of
sales tax in the State was increased from 4% to 5%, and one-half of the fifth cent was devoted to the Half-
Cent Sales Tax Program, thus giving rise to the name "Half-Cent Sales Tax." Although the amount of
sales tax revenue deposited into the Half-Cent Sales Tax Program is no longer one-half cent on every
dollar of the sales price of an item subject to sales tax, the name "Half-Cent Sales Tax" has continued to be
utilized.
Since 1993 and until July 1, 2004, the proportion of sales t<1X revenues deposited in the Local
Government Half-Cent Sales Tax Trust Fund in the State Treasury (the "Trust Fund") has been constant at
9.653% of all State sales tax. Therefore, 9.653% of the entire sales tax remitted to the State of Florida by
each sales tax dealer located within a particular county (the "Half-Cent Sales Tax Revenues") is deposited
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in the Trust Fund and is earmarked for distribution to the governing body of such particular county and
each participating municipality within that particular county pursuant to a distribution formula. The
Half-Cent Sales Tax Revenues are distributed from the Trust Fund on a monthly basis to participating
units of local government in accordance with Chapter 218, Part VI, Florida Statutes (the "Sales Tax Act").
The general rate of sales tax in the State is currently 6%, and therefore, for every dollar of taxable sales
price of an item, approximately 0.579 cents is deposited into the Trust Fund.
As described herein under "SALES TAX REVENUES - Recent Legislative Amendment," the
Florida Legislature enacted a law in 2003 pursuant to which the percentage of the sales tax deposited into
the Trust Fund will be reduced to 8.814% effective July 1, 2004. Therefore, after July 1, 2004, for every
dollar of taxable sales price of an item, approximately 0.529 cents will be deposited into the Trust Fund.
Eligibility
To be eligible to participate in the Half-Cent Sales Tax Program, each municipality and county is
required to have:
(i) reported its finances for its most recently completed fiscal year to the State Department of
Banking and Finance as required by Florida law;
(ii) made provisions for annual post audits of financial accounts in accordance with
provisions of law;
(iii) levied, as shown on its most recent financial report, ad valorem taxes, exclusive of taxes
levied for debt service or other special millages authorized by the voters, to produce the
revenue equivalent to a millage rate of three (3) mills on the dollar based upon 1973
taxable values or, in order to produce revenue equivalent to that which would otherwise
be produced by such three (3) mill ad valorem tax, to have collected an occupational
license tax, utility tax, or ad valorem tax, or any combination of those three sources;
(iv) certified that persons in its employ as law enforcement officers meet certain qualifications
for employment, and receive certain compensation;
(v) certified that persons in its employ as firefighters meet certain employment qualifications
and are eligible for certain compensation;
(vi) certified that each dependent special district that is budgeted separately from the general
budget of such county or municipality has met the provisions for annual post audit of its
financial accounts in accordance with law; and
(vii) certified to Department of Revenue that it has complied with certain procedures
regarding the establishment of the ad valorem tax millage of the county or municipality
as required by law.
Although the Sales Tax Act does not impose any limitation on the number of years during which
a county or municipality may receive distributions of the Half-Cent Sales Tax Revenues from the Trust
Fund, there may be amendments to the Sales Tax Act in subsequent years imposing additional
requirements of eligibility for counties and municipalities participating in the Half-Cent Sales Tax
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Revenues, or the distribution formula in Section 218.62, Florida Statutes may be revised. To be eligible to
participate in the Trust Fund in future years, the County must comply with the financial reporting and
other requirements of the Sales Tax Act. Otherwise, the County would lose its Trust Fund distributions
for twelve (12) months following a "determination of noncompliance" by the State Department of
Revenue. Pursuant to the Resolution, the County has covenanted to take all action necessary or required
to continue to entitle the County to receive its portion of the Half-Cent Sales Tax Revenues (i.e., the Sales
Tax Revenues) in the maximum amount provided by law and will take no action which will impair or
adversely affect its receipt of Sales Tax Revenues. The County has continuously maintained eligibility to
receive the Sales Tax Revenues since the inception of the Half-Cent Sales Tax Program in 1982.
Distribution
Half-Cent Sales Tax Revenues collected within a county are distributed among such county and
the eligible municipalities therein in accordance with the following formula:
County's Share
(percentage of
total Sales
Tax Revenues)
unincorporated county
population +
total county
population +
2/3 incorporated
area population
2/3 incorporated
area population
Municipal Share
(percentage of
total Sales
Tax Revenues)
total county
population
municipality population
2/3 incorporated
+ area population
Distribution Percentages
Below are the approximate distribution percentages for the County and for the three
municipalities within the County (the City of Naples, the City of Marco Island and the City of Everglades
City) for the past five years:
State
Fiscal Year
Percentage of
Half-Cent Sales
Tax Distribution
to Collier County
Percentage of Half-Cent
Sales Tax Distribution
to Municipalities within
Collier County
1998
1999
2000
2001
2002
85.38%
84.86
85.34
85.86
86.69
14.62%
15.14
14.66
14.]4
]3.31
Source: State of Florida, Department of Revenue.
"Sales Tax Revenues" is defined in the Resolution to mean the proceeds of the local government
half-cent sales tax, as defined and described in, and distributed to the County under Part VI, Chapter 218,
Florida Statutes.
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Historical Receipts of Sales Tax Revenues by the County
Fiscal Year
Ended September 30
1998
1999
2000
2001
2002
Unaudited
Sales Tax Revenues
$18,917,988
20,973,389
23,715,339
25,794,562
26,611,449
Percentage Change
10.86%
13.07
8.77
3.17
Source: Collier County Finance Department.
Pro-Forma Debt Service Coverage
Maximum Annual
Debt Servicenl
Sales Tax Revenues for the Fiscal
Year Ended September 30,2002
Pro-Forma Debt
Service Coverage
$11,196,370
$26,611,449
2.38x
(I) Includes actual debt service on the Outstanding Parity Bonds and the estimated debt service on
the Series 20m Bonds provided by the County's Financial Advisor based on an estimated issue
size of $54,370,000, true interest cost rate of 4.77%, and a final maturity date of October 1, 2033.
Following October 1, 2012, Maximum Annual Debt Service, based upon the same assumptions,
decreases to $6,623,273, and pro-forma debt service coverage increases to 4.02x. Following
October 1, 2020, Maximum Annual Debt Service, based upon the same assumptions, decreases to
$3,104,200, and pro-forma debt service coverage increases to 8.57x.
The amount of Half-Cent Sales Tax Revenues distributed to the County is subject to increase or
decrease due to (i) increases or decreases in the dollar volume of taxable sales within the County, (ii)
legislative changes relating to the sales tax, which may include changes in the scope of taxable sales,
changes in the tax rate and changes in the amount of sales tax revenue deposited into the Trust Fund, (iii)
changes in the relative population of unincorporated Collier County and the municipalities in Collier
County, which affect the percentage of Half-Cent Sales Tax Revenues distributed to the County, and (iv)
other factors which may be beyond the control of the County or the Series 2003 Bondholders, including
but not limited to the potential for increased use of electronic commerce and other internet-related sales
activity that could have a material adverse impact upon the amount of sales tax collected by the State of
Florida and then distributed to the County.
Recent Legislative Amendment
During the special legislative session that ended May 27, 2003, the Florida Legislature enacted
House Bil1113A, which among other things, amended Section 212.20, Florida Statutes, effective on July 1,
2004, to decrease from 9.65301., tu 8.814% the percentage of the proceeds of the sales tax to be deposited in
the Trust Fund after certain other required distributions to other funds of the State. The legislative intent
of House BilIl13A was to freeze for one fiscal year the total amount of Half-Cent Sales Tax distributiuns
to the counties and municipalities throughout the State at the level of such distributions for the State
fiscal year ended June 30, 2004. If the actual effect of House BiII113A achieves such legislative intent, the
Sales Tax Revenues received by the County for the State fiscal year ending June 30, 2005 will be the same
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as the Sales Tax Revenues received by the County for the State fiscal year ending June 30, 2004, after
which the Sales Tax Revenues would be expected to increase or decrease in each subsequent fiscal year
relative to total sales throughout the County and the State provided that no other legislative changes are
enacted.
House Bill 113A amends several provisions of the Florida Statutes. All such amendments were
intended to fund certain costs of the State judicial system, which the State is required by the Florida
Constitution to fund effective July 1, 2004. Prior to July 1, 2004, such funding of such costs of the State
judicial system has been and is the responsibility of the respective counties throughout the State. The
County anticipates such amendments will not have a material adverse impact on the County's financial
condition or the ability of the County to pay debt service on the Series 2003 Bonds.
[Remainder of page intentionally left blank]
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ESTIMA TED SOURCES AND USES OF FUNDS
The table that follows summarizes the estimated sources and uses of funds relating to the sale of
the Series 2003 Bonds:
SOURCES:
Principal Amount of Series 2003 Bonds
Other Legally Available Moneys(l)
Accrued Interest
Net Original Issue (Discount)
$
TOTAL SOURCES
$
USES:
Deposit to Construction Fund
Deposit to Escrow Fund(2)
Costs of Is~;u ance(31
Deposit to Interest Account(41
$
TOTAL USES
$
(1) Includes moneys on deposit in certain hmds and ilccounts established with respect to the
Refunded Bonds.
(2) Moneys on deposit in the Escrow Fund shall be used to pay the principal of, redemption
premium, and interest on the Refunded Bonds.
(3) Includes Bond Insurance Policy premium, 2003 Reserve Account Insurance Policy premium and
Underwriter's discount, financial advisory and legal fees and expenses, and miscellaneous costs
of issuance.
(~) Consists of accrued interest on the Series 2003 Bonds.
[Remainder of page intentionally left blank]
20
DEBT SERVICE SCHEDULE
Series 2003 Bonds
Bond Year
Ended
October 1 Principal
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
201Y
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
Annual
Debt Service
Interest
TOTALS $
$
$
lOJ".-"
Outstanding Parity Bonds
Annual Debt Service
$7,477,462.50
7,480,717.50
7,478,717.50
6,818,360.00
6,809,337.50
6,803,997.50
6,811,890.00
6,816,052.50
5,866,652.50
2,907,577.50
2,910,407.50
2,912,]12.50
2,908,312.50
2,910,000.00
2,911,000.00
2,911,250.00
2,910,500.00
2,908,500.00
$88,552,847.50
[Remainder of page intentionally left blankl
21
Combined
Annual
Debt Service
$
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FINANCIAL GUARANTY INSURANCE
The following information under this heading has been furnished by Ambac Assurance
Corporation (the "Insurer") for use in this Official Statement. Reference is made to "APPENDIX D -
FORM OF BONO INSURANCE POLlCY' attached hereto for a specimen of the Insurer's policy.
Payment Pursuant to Bond Insurance Policy
The Insurer has made a commitment to issue a financial guaranty insurance policy (the "Bond
Insurance Policy") relating to the Series 2003 Bonds effective as of the date of issuance of the Series 2003
Bonds. Under the terms of the Bond Insurance Policy, the Insurer will pay to The Hank of New York, in
New York, New York, or any successor thereto (the "InsurancE' Trustee") that portion of the principal of
and interest on the Series 2003 Bonds which shall become Due for Payment but shall be unpaid by reason
of Nonpayment (as such terms are defined in the Bond Insurance Policy) by the County. The Insurer will
make such payments to the Insurance Trustee on the later of the date on which such principal and
interest becomes Due for Payment or within one business day following the date on which the Insurer
shall have received notice of Nonpayment from the P<lying Agent. The insurance will extend for the term
of the Series 2003 Bonds and, once issued, cannot be C<lnceled by the Insurer.
The Bond Insurance Policy will insure payment only on stated maturity dates and on mandatory
sinking fund installment dates, if any, in the case of principal. <lnd on stated dates for payment, in the
case of interest. If the Series 2003 Bonds become subject to mandatory redemption and insufficient funds
are available for redemption of all outstanding Series 2003 Bonds, the Insurer will remain obligated to
pay principal of and interest on outstanding Series 2003 Bonds on the originally scheduled interest and
principal payment dates including mandatory sinking fund redemption dates. In the event of any
acceleration of the principal of the Series 2003 Bonds, the insured payments will be made at such times
and in such amounts as would have been made had there not been an acceleration.
In the event the Paying Agent has notice that any payment of principal of or interest on a Series
2003 Bond which has become Due for Payment and which is made to a holder of Series 2003 Bonds by or
on behalf of the County has been deemed a preferential transfer and theretofore recovered from its
registered owner pursuant to the United States Bankruptcy Code in accordance with a final,
nonappealable order of a court of competent jurisdiction, such registered owner will be entitled to
payment trom the Insurer to the extent at such recovery if sufficient funds are not otherwise available.
The Bond Insurance Policy does not insure any risk other than Nonpayment, as defined in the
Bond Insurance Policy. Specifically, the Bond Insurance Policy does not cover:
1. payment on acceleration, as a result of a call for redemption (other than mandatory
sinking fund redemption, if any) or as a result of any other advancement of maturity;
2. payment of any redemption, prepayment or acceleration premium; and
3. nonpayment of principal or interest caused by the insolvency or negligence of any
registrar or paying agent, if ,my.
If it becomes necessary to call upon the Bond Insurance Policy, payment of principal requires
surrender of Series 2003 Bonds to the Insurance Trustee together with an appropri<Jte instrument of
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assignment so as ta pennit ownership af such Series 2003 Bonds to be registered in the name of the
Insurer ta the extent of the payment under the Bond Insurance Policy. Payment of interest pursuant to the
Bond Insurance Policy requires proof of entitlement of an owner of Series 2003 Bonds to interest
payments and an appropriate assignment of the right of an owner of the Series Z003 Bonds to payment to
the Insurer.
Upon payment of the insurance benefits, the Insurer will become the owner of the Series 2003
Bonds, appurtenant interest, if any, or right to payment of principal or interest on such Series 2003 Bonds
and will be fully subrogated to the surrendering of Series 2003 Bonds rights to payment.
The insurance provided by the Bond Insurance Policy is not covered by the Florida Insurance
Guaranty Association.
Ambac Assurance Corporation
The Insurer is a Wisconsin-domiciled stock insurance corporation regulated by the Office of the
Commissioner of Insurance of the State of Wisconsin and licensed to do business in 50 states, the District
of Columbia, the Territory of Guam, the Commonwealth of Puerto Rico and the U.s. Virgin Islands, with
admitted assets of approximately $6,789,000,000 (unaudited) and statutory capital of approximately
$4,043,000,000 (unaudited) as of June 30, 2003. Statutory capital consists of the Insurer's bond insurance
policyholders' surplus and statutory contingency reserve. Standard & Poor's Ratings Services, a Division
of The McGraw-Hili Companies, Moody's Investors Service, and Fitch Ratings have each assigned a
triple-A financial strength rating to the Insurer. See "RATINGS" herein, however, for the ratings which
have been assigned to the Series Z003 Bonds.
The Insurer has obtained a ruling from the Intemal Revenue Service to the effect that the insuring
of an obligation by the Insurer will not affect the treatment for federal income tax purposes of interest on
such obligation and that insurance proceeds representing maturing interest paid by the Insurer under
Bond Insurance Policy provisions subst<lntially identical to those contained in the Bond Insurance Policy
shall be treated for federal income tax purposes in the same manner as if such payments were made by
the County.
The Insurer makes no representation regarding the Series Z003 Bonds or the advisability of
investing in the Series ZOO3 Bonds and makes no representation regarding, nor has it participated in the
preparation of, the Official Statement other than the infonnation supplied by the Insurer and presented
under the heading "fiNANCIAL GUARANTY INSURANCE" and "Z003 RESERVE ACCOUNT
INSURANCE POLICY" herein.
Available Information
The parent company of the Insurer, Ambac Financial Group, Inc. (the "Company"), is subject to the
informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other in/onnation with the Securities and Exchange
Commission (the "SEC"). These reports, proxy statements and other information can be read and copied at the
SEes public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-
SEC-0330 for further infonnation on the public reference room. The SEC maintains an intemet site at
http://www.sec.gov that contains reports, proxy and information statements and other information regarding
companies that file electronically with the SEe, including the Company. These reports, proxy statements and
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other information can also be read at the offices of the New York Stock Exchange, Ine. (the "NYSE"), 20 Broad
Street, New York, New York 10005.
Copies of the Insurer's financial statements prepared in accordance with statutory accounting
standards are available from the Insurer. The address of the Insurer's administrative offices and its
telephone number are One State Street Plaza, 19th Floor, New York, New York 10004 and (212) 668-0340.
Incorporation of Certain Documents by Reference
The following documents filed by the Company with tht~ SEC (File No. 1-10777) are incorporated
by reference in this Official Statement:
(1) The Company's Current Report on Form 8-K dated January 23, 2003 and filed on
January 24, 2003;
(2) The Company's Current Report on Form 8-K dated February 25, 2003 and filed on
February 28, 2003;
(3) The Company's Current Report on Form 8-K dated February 25, 2003 and filed on
March 4, 2003;
(4) The Company's Current Report on Form 8-K dated March 18,2003 and filed on March 20,
2003;
(5) The Company's Current Report on Form 8-K dated March 19,2003 and filed on March 26,
2003;
(6) The Company's Annual Report on Form lO-K for the fiscal year ended December 31,2002
and filed on March 28, 2003;
(7) The Company's Current Report on Form 8-K dated March 25, 2003 and filed on March 31,
2003;
(8) The Company's Current Report on Form 8-K dated April 17, 2003 and filed on April 21,
2003;
(9) The Company's Quarterly Report on Form lO-Q for the fiscal quarterly period ended
March 31, 2003 and filed on May 15, 2003;
(10) The Company's Current Report on Form 8-K dated July 17, 2003 and filed on July 18,
2003; and
(11) The Company's Quarterly Report on Form 10-Q for the fiscal quarterly period ended
June 30,2003 and filed on August 14, 2003.
All documents subsequently filed by the Company pursuant to the requirements of the Exchange
Act after the date of this Official Statement will be available for inspection in the same manner as
described above in "- Available Information" above.
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THE INFORMATION RELATING TO THE INSURER CONTAINED ABOVE HAS BEEN
FURNISHED BY THE INSURER. NO REPRESENTATION IS MADE BY THE COUNTY OR THE
UNDERWRITER AS TO THE ACCURACY OR ADEQUACY OF SUCH INFORMATION OR THAT
THERE HAS NOT BEEN ANY MATERIAL ADVERSE CHANGE IN SUCH INFORMATION
SUBSEQUENT TO THE DATE OF SUCH INFORMATION. NEITHER THE COUNTY NOR THE
UNDERWRITER MADE ANY INVESTIGATION INTO THE FINANCIAL CONDITION OF THE
INSURER, AND NO REPRESENTATION IS MADE AS TO THE ABILITY OF THE INSUI{ER TO MEET
ITS OBLIGATIONS UNDER THE BOND INSURANCE POLlCY.
2003 RESERVE ACCOUNT INSURANCE POLICY
Concurrently with the issuance of the Series 2003 Bonds, the Insurer will issue its (debt service
reserve fund insurance policy} (the "2003 Reserve Account Insurance Policy") for deposit into the
Reserve Account. A general description of the Insurer's financial condition is contained under the
heading "FINANCIAL GUARANTY INSURANCE" herein. A form of the 2003 Reserve Account
Insurance Policy is attached hereto as "APPENDIX E - FORM OF 2003 RESERVE ACCOUNT
INSURANCE POLICY." The following information under this heading has been furnished by the Insurer
for use in this Official Statement.
The Resolution authorizes the County to obtain the 2003 Reserve Account Insurance Policy in
place of funding the Reserve Account with cash. Accordingly, application has been made to the Insurer
for the issuance of the Reserve Insurance Account Policy in the amount equal to $ for the
purpose of satisfying the requirement to have on deposit in the Reserve Account in an amount equal to
the Maximum Bond Service Requirement. See "APPENDIX C -- Summary of Certain Provisions of the
Resolution" attached hereto. The Series 2003 Bonds will only be delivered upon the issuance of such 2003
Reserve Account Insurance Policy. The premium on the 2003 Reserve Account Insurance Policy is to be
fully paid at or prior to the issuance and delivery of the Series 2003 Bonds. The 2003 Reserve Account
Insurance Policy provides that upon the later of (i) one (1) day after receipt by the Insurer of a demand for
payment executed by the Paying Agent certifying that provision for the payment of principal of or
interest on the Bonds when due has not been made or (ii) the interest payment date specified in the
Demand for Payment submitted to the Insurer, the Insurer will promptly deposit funds with the Paying
Agent sufficient to enable the Paying Agent to make such payments due on the Bonds, but in no event
exceeding the Surety Bond Coverage, as defined in the 2003 Reserve Account Insurance Policy. For
further information regarding the Insurer, see "FINANCIAL GUARANTY INSURANCE" herein.
Pursuant to the terms of the 2003 Reserve Account Insurance Policy, the Surety Bond Coverage is
automatically reduced to the extent of each payment made by the Insurer under the terms of the 2003
Reserve Account Insurance Policy and the County is required to reimburse the Insurer for any draws
under the 2003 Reserve Account Insurance Policy with interest at a market rate. Upon such
reimbursement, the 2003 Reserve Account Insurance Policy is reinstated to the extent of each principal
reimbursement up to but not exceeding the Surety Bond Coverage. The reimbursement obligation of the
County is subordinate to the County's payment obligations with respect to the Bonds.
In the event the amount on deposit, or credited to the Reserve Account, exceeds the amount of
the 2003 Reserve Account Insurance Policy, any draw on the 2003 Reserve Account Insurance Policy shall
be made only after all the funds in the Reserve Account have been expended. In the event that the
amount on deposit in, or credited to, the Reserve Account, in addition to the amount available under the
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2003 Reserve Account Insurance Policy, includes amounts available under a letter of credit, insurance
policy, surety bond or other such funding instrument (the "Additional Funding Instrument"), draws on
the 2003 Reserve Account Insurance Policy and the Additional Funding Instrument shall be made on a
pro rata basis to fund the insufficiency. The Resolution provides that deficiencies caused by a drawing on
the 2003 Reserve Account Insurance Policy must be replenished from first available Pledged Revenues
within twelve months of the date of the related deficiency.
The 2003 I{eserve Account Insurance Policy does not insure against nonpayment caused by the
insolvency or negligence of the Paying Agent.
The insurance provided by the 2003 Reserve Account Insurance Policy is not covered by the
Florida Insurance Guaranty Association.
THE INFORMATION RELATING TO THE INSURER CONTAINED ABOVE HAS BEEN
FURNISHED BY THE INSURER. NO REPRESENTATION IS MADE BY THE COUNTY OR THE
UNDERWRITER AS TO THE ACCURACY OR ADEQUACY OF SUCH INFORMATION OR THAT
THERE HAS NOT BEEN ANY MATERIAL ADVERSE CHANCE IN SUCH INFORMATION
SUBSEQUENT TO THE DATE OF SUCH INfORMATION. NEITHER THE COUNTY NOI{ THE
UNDERWRITER HAS MADE ANY INVESTIGATION INTO THE FINANCIAL CONDITION OF THE
INSURER, AND NO REPRESENTATION IS MADE AS TO THE ABILITY OF THE INSURER TO MEET
ITS OBLIGATIONS UNDER THE 2003 RESERVE ACCOUNT INSURANCE POLICY.
2002 RESERVE ACCOUNT INSURANCE POLICY
Prior to the issuance of the Series 2003 Bonds, Financial Guaranty Insurance Corporation ("FCIC")
issued its Insurance Policy (the "2002 Reserve Account Insurance Policy") for deposit into the Reserve
Account. The 2002 Reserve Account Insurance Policy is an Additional Funding Instrument. A copy of
the 2002 Reserve Account Insurance Policy is attached hereto uS "APPENDIX F - 2002 RESERVE
ACCOUNT INSURANCE POLICY." The following information under this heading has been furnished
by the FCIC for use in this Official Statement.
The 2002 Reserve Account Insurance Policy unconditionally guarantees the payment of that
portion of the principal of and interest on the Bonds which has become due for payment, but shall be
unpaid by reason of nonpayment by the County, provided that the aggregate amount paid under the
2002 Reserve Account Insurance Policy may not exceed the maximum amount set forth in the 2002
Reserve Account Insurance Policy ($8,148,870). FGIC will make such payments to the Paying Agent on
the later of the date on which such principal or interest (as applicable) is due or on the business day next
following the day on which FGIC shall have received telephonic or telegraphic notice subsequently
confirmed in writing or written notice by registered or certified mail from the Paying Agent of the
nonpayment of such amount by the County. The term "nonpayment" in respect of a Bond includes any
payment of principal or interest made to an owner of a Bond which has been recovered from such owner
pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with a final
nonappealable order of a court having competent jurisdiction.
The 2002 Reserve Account Insurance Policy is non-cancellable and the premium was fully paid at
the time of delivery of the County's Capital Improvement Revenue Bond~, Series 2002. The 2002 Reserve
Account lnsurance Policy covers fililure to pay principal of the Bonds on their respective stated maturity
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1f ......... .'f>'
. ;-/
,~,
dates, or dates on which the same shall have been called for mandatory sinking fund redemption, and not
on any other date on which the Bonds may have been accelerated, and covers the failure to pay an
installment of interest on the stated date for its payment. The 2002 Reserve Account Insurance Policy
shall terminate on the earlier of October 1,2021 or the date on which no Bonds are outstanding under the
Resolution.
Generally, in connection with its issuance of a 2002 Reserve Account Insurance Policy, FGIC
requires, among other things, (i) that, so long as it has not failed to comply with its payment obligations
under the 2002 Reserve Account Insurance Policy, it be granted the power to exercise any remedies
available at law or under the authorizing document other than (A) acceleration of the Bonds or (B)
remedies which would adversely affect holders in the event that the County fails to reimburse FGIC for
any draws on the 2002 Reserve Account Insurance Policy; and (ii) that any amendment or supplement to
or other modification of the principal legal documents be subject to FGICs consent. The specifir rights, if
any, granted to FGIC in connection with its issuance of the 2002 Reserve Account Insurance Poliry are set
forth in the description of the principal legal documents appearing elsewhere in this Official Statement.
Reference should be made to the Resolution for a discussion of the circumstances, if any, under which the
County is required to provide additional or substitute credit enhancement, and related matters.
The 2002 Reserve Account Insurance Policy is not covered by the Property/Casualty Insurance
Security Fund sperified in Article 76 of the New York Insurance Law or by the Florida Insurance
Guaranty Assoriation (Florida Insurance Code, Sections 631.50 l'l seq.).
FGIC is a wholly-owned subsidiary of FGIC Corporation (the "Corporation"), a Delaware holding
company. The Corporation is a subsidiary of General Electric Capital Corporation ("GE Capital").
Neither the Corporation nor GE Capital is obligated to pay the debts of or the claims against FGle. FGIC
is a monoline financial guaranty insurer domiciled in the State of New York and subject to regulation by
the State of New York Insurance Department. As of June 30, 2003, the total capital and surplus of FGIC
was approximately $1.014 billion. FGIC prepares financial statements on the basis of both statutory
accounting principles and generally accepted accounting principles. Copies of such financial statements
may be obtained by writing to FGIC at 125 Park Avenue, New York, New York 10017, Attention:
Communications Department (telephone number: 212-312-3000) or to the New York State Insurance
Department at 25 Beaver Street, New York, New York 10004-2319, Attention: Financial Condition
Property/Casualty Bureau (telephone number: 212-480-5187).
On August 4, 2003, General Electric Company ("GE") announced that its indirect. wholly owned
subsidiary, FGIC Holdings, Ine. ("Holdings"), had entered into an agreement to sell the Corporation (and
FGIC) to Falcons Acquisition Corp. ("Newco"), a newly-formed Delaware corporation owned by a
consortium of investors consisting of The PMI Group, Inc. and private equity funds affiliated with
Blackstone Group, Cypress Group and CIVC Partners, subject to receipt of regulatory approvals, written
confirmations from Moody's, Standard & Poor's and Fitch that FGIC's insurance financial strength rating
will remain at Aaa, AAA and AAA, respectively, immediately following the closing of the contemplated
transactions, and satisfaction of other closing conditions. Immediately following the closing, it is
expected that Newco will be merged with and into the Corporation and that GE (through its subsidiaries)
will retain $234.6 million of preferred stock, and less than 5% of the common stock, of the Corporation.
THE INFORMATION RELATING TO FGIC CONTAINED ABOVE HAS BEEN FURNISHED BY
FGIe. NO REPRESENTATION IS MADE BY THE COUNTY Ol~ THE UNDERWRITER AS TO THE
ACCURACY OR ADEQUACY OF SUCH INFORMATION OR THAT THERE HAS NOT BEEN ANY
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MATERIAL ADVERSE CHANGE IN SUCI-I INFORMATION SUBSEQUENT TO THE DATE OF SUCH
INFORMATION. NEITHER THE COUNTY NOR THE UNDERWRITER HAS MADE ANY
INVESTIGATION INTO THE FINANCIAL CONDITION OF FGIC, AND NO REPRESENTATION IS
MADE AS TO THE ABILITY OF FGIC TO MEET ITS OBLIGATIONS UNDER THE 2002 RESERVE
ACCOUNT INSURANCE POLICY.
INVESTMENT POLICY
The moneys held in the funds and accounts under the Resolution may only be invested in
Authorized Investments (as defined in the Resolution). The investment of surplus funds is currently
governed by the provisions of the County's Ordinance No. 87-65 and Resolution No. 95-552 which
authorize investments for surplus public funds in the permitted investments described in Section 218.415,
Florida Statutes.
Pursuant to Resolution No. 95-552, the Clerk of the Circuit Court (the "Clerk") has established a
written investment policy for the such surplus funds. The investment policy establishes guidelines as to
the type, maturity, composition and risk relating to the County's investment portfolio.
Permitted investments pursuant to such investment policy include the following:
1. Florida Local Government Surplus Trust Fund (State Board of Administration ("SBA"));
2. US Government Securities - Direct Obligations;
3. US Federal Agencies - Bilcked by Full Faith and Credit of US Government;
4. US Federal Instrumentalities - US Federal Agency Securities Not Backed by Full Faith
and Credit of US Government, except for Student Loan Marketing Association;
5. Certificates of Deposit - Collateralized with US Government Securities or Federal
Agencies;
6. Repurchase Agreements;
7. Fixed Income Mutual Funds - Collateralized with US Government Securities or Federal
Agencies;
8. Domestic Bankers Acceptances - Rated "AA" or higher, and inventory based;
9. Prime Commercial Paper - Rated "A-l" and "P-l," and backed by a letter of credit rated
"AA" or higher;
10. Tax-Exempt Obligations - Rated "AA" or higher and issued by state or local governments;
11. Now ^ccount - Fully collateralized in accordance with Chapter 280, Florida Statutes
(limited to Depository Bank/Concentration Bank);
12. Variable Rate Securities only if the rate is a straight floating rate that is set in a direct, as
opposed to inverse, relationship to a single index; and
13. Mortgage Securities (CMOs) only if they are:
a. Issued by US Federal Agencies or US Federal Instrumentalities,
b. Pass the Federal Financial Investment Examination Council (FFIEC) test at time
of purchase, and
c. Have an average life of five (5) years or less and have an absolute final maturity
of no more than fifteen (15) years at zero PSA. The term "zero PSA" means that
all interest and principal payments are guaranteed to be made by the stated final
maturity assuming no prepayments.
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Specifically prohibited investments include the following:
1. Interest only strips of mortgaged backed securities;
2. Leveraged bonds;
3. Structured notes or financings other than mortgage securities that meet the provisions of
the investment policy (permit callable and step up coupons);
4. Variable rate securities that set a rate based on an inverse relationship to an index; and
5. Variable rate debt that sets a rate based on more than a single index.
The County continues to hold various U.S. Government agency securities, including Federal
Home Loan Mortgage Corporation and Federal National Mortgage Association collateralized mortgage
obligations that were purchased in 1993. [At September 30, 2002, the fair market value of these
investments was approximately $267,000, which is 3% below cost.] [County to confirm.]
The objective of the investment policy is to match investment cash flow and maturity with known
cash needs and anticipated cash flow requirements (i.e., match assets to liabilities) to the extent possible.
Investment of funds shall have final maturities of not more than five (5) years, except for:
1. SBA - no stated final maturity;
2. Certificates of Deposit - 1 Year;
3. Repurchase Agreements - 90 Days;
4. Bankers Acceptances - 120 Days;
5. Prime Commercial Paper - 120 Days;
6. Fixed Income Mutual Funds - no stated final maturity. However, underlying US
Government Securities and Federal Agencies have average maturity of 1 year;
7. Mortgage Securities - average life of 5 years or less and have an absolute final maturity of
no more than 15 years at zero PSA; and
8. US Government Securities and Federal Agencies deposited into an escrow account in
connection with the refunding of a County bond issue can have a final maturity of more
than 5 years.
Mortgage securities shall not be used to match liabilities that are reasonably definable as to
amount and disbursement date. Mortgage securities can only be used to invest funds associated with
reserves or liabilities that are not associated with a specifically identified cash flow schedule. Mortgage
securities can be used to prudently enhance the return on the portfolio.
Any and all exceptions to the investment policy require a vote of the majority of Board.
Furthermore, the Board may revise the aforementioned investment policy from time to time.
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~.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the Series 2003 Bonds are subject to an
approving legal opinion of Nabors, Giblin & Nickerson, P.A., Tampa, Florida, Bond Counsel, whose
approving opinion (a form of which is attached hereto as "APPENDIX G -FORM OF BOND COUNSEL
OPINION") will be available at the time of delivery of the Series 2003 Bonds. Certain legal matters will be
passed on for the County by David e. Weigel, Esq., County Attorney, and Bryant Miller & Olive P.A.,
Tampa, Florida, Disclosure Counsel.
Bond Counsel has not been engaged to, nor has it undertaken to, review (1) the accuracy,
completeness or sufficiency of this Official Statement or any other offering material relating to the Series
2003 Bonds; provided, however, that Bond Counsel will render an opinion to the Underwriter of the
Series 2003 Bonds (upon which opinion only the Underwriter may rely) relating to the fairness of the
presentation of certain statements contained herein under the heading "TAX EXEMPTION" and certain
statements which summarize provisions of the I{esolution, the Series 2003 Bonds, and federal tax law,
and (2) the compliance with any federal or state law with regard to the sale or distribution of the Series
2003 Bonds.
LITIGA TION
There is no pending or, to the knowledge of the County, any threatened litigation against the
County of any nature whatsoever which in any way questions or affects the validity of the Series 2003
Bonds, or any proceedings or transactions relating to their issuance, sale, execution, or delivery, or the
adoption of the Resolution, or the pledge of the Pledged Revenues. Neither the creation. organization or
existence, nor the title of the present members of the Board, or other officers of the County is being
contested.
The County and five individual Board members are defendants in a lawsuit filed on June 21,
2001, by Aquaport, L.e., a Florida limited liability company, Norman C. Burke and James Allen in the
United States District Court for the Middle District of Florida in a case styled Aqllaport, L.c., et aT. v. Collier
County, et aI., Case No. 2:01-CY-341-FTM-29DNF. The suit seeks both equitable and monetary relief and
arises from the County's decision on May 22, 2001 to revoke the site development plan and building
permit previously issued to Aquaport, L.e., for a 10 story, 68 unit hotel. The County and the five
individual Board members responded to the initial complaint with a motion to dismiss. Thereafter, the
plaintiffs filed a first amended complaint asserting claims under 42 U.s.e. S 1983 against the Board
members individually and against the County for alleged deprivations of procedural and substantive due
process in connection with the revocation of the site development plan and building permit. ]n addition,
Aquaport, L.e., has sued for equitable estoppel, claiming that it had vested rights in the building permit
and the right to construct the hotel building in accordance with the previously approved site
development plan. Aquaport, L.e., also seeks a declaratory judgment as to whether it is necessary for it
to file a petition for certiorari and, in the alternative, relief for a petition for writ of certiorari. Aquaport,
L.e., claims that it has damages for a loss of commitment to lease the proposed hotel at a profit of
$1,000,000 per year and claims other damages in the form of increased construction costs and additional
financing charges and other carrying costs including interest. Although no exact damage amount is set
forth in the first amended complaint, it is the County's understanding that Aquaport, L.e., is claiming in
excess of $10,000,000 in damages, with most of those damages being based upon alleged lost profits from
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the alleged commitment to lease the proposed hotel. Finally, ~'fr. Burke and Mr. Allen are claiming an
unspecified amount of emotional distress damages and the plaintiffs are also claiming attorneys' fees.
The County and the plaintiffs filed motions for summary judgment and on February 6, 2003, the
federal court granted the County's motion for summary judgment in the Aquaport case, dismissing two of
the plaintiffs' counts with prejudice and two other of the plaintiffs' counts (which are issues of State law)
without prejudice. The plaintiffs can, therefore, file a complaint regarding certain issues of State law in
State court. The plaintiffs have appealed the summary judgment ruling. At this point, the County is
unable to predict whether the plaintiffs will ultimately be successful in this action, and if plaintiffs are
successful, the County is unable to predict how its potential liability, if any, might effect the financial
condition of the County. However, whether or not the plaintiffs are successful, any potential liability is
not expected to affect the County's ability to pay the principal and interest on the Series 2003 Bonds.
The Board has been named as a defendant in a lawsuit filed on January 10, 2003, in the Circuit
Court for the Twentieth Circuit, Collier County. The case is styled Centunj Development of Collier County,
Inc., et al. v. Jeb Bush, et aI., Case No. 03-117-CA-HTII. The suit, which also names the individual members
of the State of Florida Administration Commission as defendants, has been brought by Century
Development of Collier County, Inc., Joseph DeFrancesco, Ricardo A. Haylock and Mildred Haylock,
Francis D. llussey, Mary Pat Hussey, and Anne Kornfeld, as class representatives for approximately 400
to 500 persons owning property in that area of the County known as North Belle Meade. The plaintiffs
seek monetary relief from the Board for the purported inverse condemnation of property in North Belle
Meade that allegedly results from the Board's enactment of an ordinance and comprehensive plan
amendments. The plaintiffs contend that the ordinance and comprehensive plan amendments imposed a
moratorium on the North Belle Meade properties, the effect of which was a temporary deprivation of all
or substantially all beneficial use of such properties, including but not limited to certain mining rights.
The plaintiffs did not identify in the Complaint the amount of damages being sought. On February 24,
2003, both the County and the Administration Commission filed motions to dismiss, which motions are
expected to be heard on , 2003. Based upon the allegations as currently pled, the Board has
a reasonable likelihood of prevailing. A t this time, however, the County is unable to predict whether and
how the complaint may be amended and, therefore, is unable to predict whether the plaintiffs will be
successful in this action and, if successful, the extent of the Board's ultimate liability. However, whether
or not the plaintiffs are successful, any potential liability is not expected to affect the County's ability to
pay the principal and interest on the Series 2003 Bonds.
The County experiences other claims, litigation, and various legal proceedings which
individually are not expected to have a material adverse effect on the operations or financial condition of
the County, but may, in the aggregate, have a material impact thereon. In the opinion of the County
Attorney, however, except as noted above, the County will either successfully defend such actions or
otherwise resolve such matters without any material adverse consequences on the financial condition of
the County.
DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS
Pursuant to Section 517.051, Florid;] Statutes, as amended, no person may directly or indirectly
offer or sell securities of the County except by an offering circular containing full and fair disclosure of all
defaults as to principal or interest on its obligations since December 3], 1975, as provided by rule of the
Florida Department of Banking and Finance (the "Department"). Pursuant to Rule 3E-400.003, Florida
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Administrative Code, the Department has required the disclosure of the amounts and types of defaults,
any legal proceedings resulting from such defaults, whether a tmstee or receiver has been appointed over
the assets of the County, and certain additional financial information, unless the County believes in good
faith that such information would not be considered material by a reasonable investor. The County is not
and has not been in default on any bond issued since December 31, 1975 which would be considered
material by a reasonable investor.
T AX EXEMPTION
Opinion of Bond Counsel
In the opinion of Bond Counsel, the form of which is included as "APPENDIX G - FORM OF
BOND COUNSEL OPINION" attached hereto, the interest on the Series 2003 Bonds is excludable from
gross income for federal income tax purposes and is not a specific item of tax preference for federal
income tax purposes under existing statutes, regulations, rulings and court decisions. However, interest
on the Series 2003 Bonds is taken into account in determining adjusted current earnings for purposes of
computing the federal alternative minimum tax imposed on corporations pursuant to the Internal
Revenue Code of 1986, as amended (the "Code''). Failure by the County to comply subsequently to the
issuance of the Series 2003 Bonds with certain requirements of the Code, regarding the use, expenditure
and investment of Series 2003 Bonds proceeds and the timely pilyment of certain investment earnings to
the Treasury of the United States, may cause interest on the Series 2003 Bonds to become includable in
gross income for federal income tax purposes retroactive to their date of issuance. The County has
covenanted in the Resolution to comply with all provisions of the Code necessary to, among other things,
maintain the exclusion from gross income of interest on the Series 2003 Bonds for purposes of federal
income taxation. In rendering its opinion, Bond Counsel has assumed continuing compliance with such
covenants.
Internal Revenue Code of 1986
The Code contains a number of provisions that apply to the Series 2003 Bonds, including, among
other things, restrictions relating to the use or investment of the proceeds of the Series 2003 Bonds and the
payment of certain arbitrage earnings in excess of the "yield" on the Series 2003 Bonds to the Treasury of
the United States. Noncompliance with such provisions may result in interest on the Series 2003 Bonds
being included in gross income for federal income tax purposes retroactive to their date of issuance.
Collateral Tax Consequences
Except as described above, Bond Counsel will express no opinion regarding the federal income
tax consequences resulting from the ownership of, receipt or accrual of interest on, or disposition of, the
Series 2003 Bonds. Prospective purchasers of Series 2003 Bonds should be aware that the ownership of
Series 2003 Bonds may result in other collateral federal tax consequences. For example, ownership of the
Series 2003 Bonds may result in collateral tax consequences to various types of corporations relating to (1)
denial of interest deduction to purchase or carry such Series 2003 Bonds, (2) the branch profits tax, and (3)
the inclusion of interest on the Series 2003 Bonds in passive income for certain Subchapter 5 corporations.
In addition, the interest on the Series 2003 Bonds may be included in gross income by recipients of certain
Social Security and Railroad Retirement benefits.
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PURCHASE, OWNERSHIP, SALE OR DISPOSITION OF THE SERIES 2003 BONDS AND THE
RECEIPT OR ACCRUAL OF THE INTEREST THEREON MAY HAVE ADVERSE FEDERAL TAX
CONSEQUENCES FOR CERTAIN INDIVIDUAL AND CORPORATE BONDHOLDERS, INCLUDING,
BUT NOT LIMITED TO, THE CONSEQUENCES REFERRED TO ABOVE. PROSPECTIVE SERIES 2003
BONDHOLDERS SHOULD CONSULT WITH THEIR TAX SPECIALISTS FOR INFORMATION IN
THAT REGARD.
Florida Taxes
In the opinion of Bond Counsel, the Series 2003 Bonds and the income thereon are exempt from
all present intangible personal property taxes imposed pursuant to Chapter 199. Florida Statutes.
Other Tax Matters
Interest on the Series 2003 Bonds may be subject to state or local income taxation under
applicable state or local laws in other jurisdictions. Purchasers of the Series 2003 Bonds should consult
their own tax advisors as to the income tax status of interest on the Series 2003 Bonds in their particular
state or local jurisdiction.
During recent years, legislative proposals have been introduced in Congress, and in some cases
enacted, that altered certain federal tax consequences resulting from the ownership of obligations that are
similar to the Series 2003 Bonds. In some cases, these proposals have contained provisions that altered
these consequences on a retroactive basis. Such alterations of federal tax consequences may have affected
the market value of obligations similar to the Series 2003 Bonds. From time to time, legislative proposals
are pending which could have an effect on both the federal tax consequences resulting from ownership of
the Series 2003 Bonds and their market value. No assurance can be given that additional legislative
proposals will not be introduced or enacted that would or might apply to, or have an adverse effect upon,
the Series 2003 Bonds.
Tax Treatment of Original Issue Discount
Bond Counsel is further of the opinion that the difference between the principal amount of the
Series 2003 Bonds maturing _ through --' inclusive and on _ (collectively the "Discount Bonds")
and the initial offering price to the public (excluding bond houses, brokers or similar persons or
organizations acting in the capacity of underwriters or wholesalers) at which price a substantial amount
of such Discount Bonds of the same maturity was sold constitutes original issue discount which is
excludable from gross income for federal income tax purposes to the same extent as interest on the Series
2003 Bonds. Further, such original issue discount accrues actuarially on a constant interest rate basis over
the term of each Discount Bond and the basis of each Discount Bond acquired at such initial offering price
by an initial purchaser thereof will be increased by the amount of such accrued original issue discount.
The accrual of original issue discount may be taken into account as an increase in the amount of tax-
exempt income for purposes of determining various other tax consequences of owning the Discount
Bonds, even though there will not be a corresponding cash payment. Owners of the Discount Bonds are
advised that they should consult with their own advisors with respect to the state and local tax
consequences of owning such Discount Bonds.
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Tax Treatment of Bond Premium
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The difference between the principal amount of the Series 2003 Bonds maturing on _ through
---' inclusive and on _ (collectively, the "Premium Bonds") and the initial offering price to the public
(excluding bond houses, brokers or similar persons or organizations acting in the capacity of
underwriters or wholesalers) ilt which price a substantial amount of such Premium Bonds of the same
maturity was sold constitutes to an initial purchaser amortizable bond premium which is not deductible
from gross income for Federal income tax purposes. The amount of amortizable bond premium for a
tilxable year is determined actuarially on a constant interest rate basis over the term of each Premium
Bond. For purposes of determining gain or loss on the sale or other disposition of a Premium Bond, an
initial purchaser who acquires such obligation in the initial offering to the public at the initial offering
price is required to decrease such purchaser's adjusted basis in such Premium Bond annually by the
amount of amortizable bond premium for the taxable year. TIle amortization of bond premium may be
taken into account as a reduction in the amount of tax-exempt income for purposes of determining
various other tax consequences of owning such Premium Bonds. Owners of the Premium Bonds are
advised that they should consult with their own advisors with respect to the state and local tax
consequences of owning such Premium Bonds.
RATINGS
(Fitch Ratings ("Fitch"), Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's
Ratings Services ("S&P")) are expected to assign their municipal bond ratings of "AAA," "Aaa" and
"AAA," respectively, to the Series 2003 Honds with the understanding that upon delivery of the Series
2003 Bonds, the Bond Insurance Policy will be issued by the Insurer. In addition, [Fitch, Moody's and
S&P have assigned underlying ratings of "AA-," "AI" and ..AA.... respectively,} without giving any
regard to such Bond Insurance Policy. The ratings reflect only the views of said rating agencies and an
explanation of the ratings may be obtained only from said rating agencies. There is no assurance that
such ratings will continue for any given period of time or that they will not be lowered or withdrawn
entirely by the rating agencies, or any of them, if in their judgment, circumstances so warrant. A
downward change in or withdrawal of any of such ratings, may have an adverse effect on the market
price of the Series 2003 Bonds. [An explanation of the significance of the ratings can be received from
the rating agencies, at the following addresses: Fitch Ratings, One State Street Plaza, New York, New
York 10004, Moody's Investors Service. Inc., 99 Church Street, New York, New York 10007-2796 and
Standard & Poor's Ratings Services, 55 Water Street, New York, New York 10041.]
VERIFICATION OF MATHEMATICAL COMPUTATIONS
At the time of the delivery of the Series 2003 Bonds, Causey Demgen & Moore Inc., Denver,
Colorado, a firm of independent certified public accountants, will deliver a report on the mathematical
accuracy of the computations contained in schedules provided to them and prepared by William R.
Hough & Co. on behalf of the County relating to the sufficiency of the anticipated cash and maturing
principal amounts of and interest on the Obligations of the United States of America to pay, when due,
the principal upon prior redemption, interest and call premium requirements of the Refunded Bonds.
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FINANCIAL ADVISOR
The County has retained William R. Hough & Co., Naples, Florida, as Financial Advisor in
connection with the County's financing plans and with respect to the authorization and issuance of the
Series 2003 Bonds. The Financial Advisor is not obligated to undertake and has not undertaken to make
an independent verification or to assume responsibility for the accuracy, completeness, or fairness of the
information contained in the Official Statement. The Financial Advisor did not participate in the
underwriting of the Series 2003 Bonds. The Financial Advisor may receive a fee for bidding investments
for certain proceeds of the Series 2003 Bonds.
AUDITED FINANCIAL 51' A TEMENTS
The General Purpose Financial Statements of the County for the fiscal year ending September 30,
2002, and report thereon of KPMG LLP (the "Independent Certified Public Accountant") are attached
hereto as "APPENDIX B - AUDITED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED
SEPTEMBER 30, 2002." Such statements speak only as of September 30, 2002. Such statements, including
the report of the Independent Certified Public Accountant, haw been included in this Offjcial Statement
as public documents and the consent of the Independent Certified Public Accountant to include such
documents herein was not requested.
The Series 2003 Bonds are payable solely from the Pledged Revenues as described in the
Resolution and herein and the Series 2003 Bonds are not otherwise secured by, or payable from, the
general revenues of the County. See "SECURITY FOR THE BONDS" herein. The General Purpose
Financial Statements are presented for general information purposes only.
UNDERWRITING
The Series 2003 Bonds are being purchased by __... (the "Underwriter") at an
aggregate purchase price of $ (which equals the principal amount of the Series 2003 Bonds,
plus a premium of $ , less original issue discount of $ and less Underwriter's
discount of $ ), plus accrued interest. The Underwriter's obligations are subject to certain
conditions precedent described in the Official Notice of Sale which was prepared by the County, and it
will be obligated to purchase all of the Series 2003 Bonds if any Series 2003 Bonds are purchased. The
Series 2003 Bonds may be offered and sold to certain dealers (including dealers depositing such Series
2003 Bonds into investment trusts) at prices lower than such public offering prices, and such public
offering prices may be changed, from time to time, by the Underwriter.
CONTINGENT FEES
The County has retained Bond Counsel, the Financial Advisor and Disclosure Counsel with
respect to the authorization, sale, execution and delivery of the Series 2003 Bonds. Payment of the fees of
such professionals and an underwriting discount to the Underwriter are each contingent upon the
issuance of the Series 2003 Bonds.
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ENFORCEABILITY OF REMEDIES
The remedies available to the owners of the Series 2003 Bonds upon an event of default under the
Resolution, the Bond Insurance Policy, the 2003 Reserve Account Insurance Policy and the 2002 Reserve
Account Insurance Policy are in many respects dependent upon judicial actions which are often subject to
discretion and delay. Under existing constitutional and statutory law and judicial decisions, including
specifically the federal bankruptcy code, the remedies specified by the Resolution, the Series 2003 Bonds,
the Bond Insurance Policy, the 2003 Reserve Account Insurance Policy and the 2002 Reserve Account
Insurance Policy may not be readily available or may be limited. The various legal opinions to be
delivered concurrently with the delivery of the Series 2003 Bonds, including Bond Counsel's approving
opinion, will be qualified, as to the enforceability of the remedies provided in the various legal
instruments, by limitations imposed by bankruptcy, reorganization, insolvency or other similar laws
affecting the rights of creditors enacted before of after such delivery. See "APPENDIX C - SUMMARY
OF CERTAIN PROVISIONS Of THE RESOLUTION" attached hereto for a description of events of
default and remedies.
CONTINUING DISCLOSURE
The County has covenanted for the benefit of the Series 2003 Bondholders to provide certain
financial information and operating data relating to the County and the Series 2003 Bonds in each year,
and to provide notices of the occurrence of certain enumerated material events. The County has agreed
to file annual financial information and operating data and its audited financial statements with each
nationally recognized municipal securities information repository then approved by the Securities and
Exchange Commission (the "NRMSl!{s"), as well as any state information depository that is established in
the State (the "SID"). Currently, there are no such SIDs. The County has agreed to file notices of certain
enumerated material events, when and if they occur, with the NRMSIRs or the Municipal Securities
Rulemaking Board, and with the SIDs, if any.
The specific nature of the financial information, operating data, and of the type of events which
trigger a disclosure obligation, and other details of the undertaking are described in "APPENDIX H -
FORM OF CONTINUING DISCLOSURE CERTIFICATE" attached hereto. The Continuing Disclosure
Certificate shall be executed by the County prior to the issuance of the Series 2003 Bonds. These
covenants have been made in order to assist the Underwriter in complying with the continuing disclosure
requirements of Rule 15c2-12 promulgated by the Securities and Exchange Commission (the "Rule").
With respect to the Series 2003 Bonds, no party other than the County is obligated to provide, nor
is expected to provide, any continuing disclosure information with respect to the Rule. The County has
never failed to comply with any prior agreements to provide continuing disclosure information pursuant
to the Rule.
ACCURACY AND COMPLETENESS OF OFFIClAL STATEMENT
The references, excerpts, and summaries of all documents, statutes, and information concerning
the County and certain reports and statistical data referred to herein do not purport to be complete,
comprehensive and definitive and each such summary and reference is qualified in its entirety by
reference to each such document for full and complete statements of all matters of fact relating to the
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Series 2003 Bonds, the security for the payment of the Series 2003 Bonds and the rights and obligations of
the owners thereof and to each such statute, report or instrument. Copies of such documents may be
obtained from either the office of the Clerk of the Board of County Commissioners, Collier County
Government Complex, 3301 East Tamiami Trail, Building F, Naples, Florida 34112, telephone: (239) 774-
8383 or the County's Financial Advisor, William R. Hough & Co., SOO Fifth Avenue South, Suite 509,
Naples, Florida 34102-6615, telephone (239) 649-6077.
Any statements made in this Official Statement involving matters of opinion or of estimates,
whether or not so expressly stated are set forth as such and not as representations of fact, and no
representation is made that any of the estimates will be realized. Neither this Official Statement nor any
statement that may have been made verbally or in writing is to be construed as a contract with the
owners of the Series 2003 Bonds.
The appendices attached hereto are integral parts of this Official Statement and must be read in
their entirety together with all foregoing statements.
AUTHORIZA nON OF OFFICIAL STATEMENT
The execution and delivery of this Official Statement h<1s been duly authorized and approved by
the County. At the time of delivery of the Series 2003 Bonds, the County will furnish a certificate to the
effect that nothing has come to their attention which would lead it to believe that the Official Statement
(other than information herein related to the Insurer, the Bond Insurance Policy, the 2003 Reserve
Account Insurance Policy, FGIC, the 2002 Reserve Account Insurance Policy, DTC, the book-entry only
system of registration and the information contained under the caption "TAX EXEMPTION" as to which
no opinion shall be expressed), as of its date and as of the date of delivery of the Series 2003 Bonds,
contains an untrue statement of a material fact or omits to state a material fact which should be included
therein for the purposes for which the Official Statement is intended to be used, or which is necessary to
make the statements contained therein, in the light of the circumstances under which they were made,
not misleading.
BOARD OF COUNTY COMMISSIONERS
COLLIER COUNTY, FLORIDA
By:
Chairman, Board of County Commissioners
Collier County, Florida
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APPENDIX A
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GENERAL INFORMA nON REGARDING
COLLIER COUNTY, FLORIDA
The following information concerning Collier County, Florida (the "County") has been supplied
by the County and is included only for purposes of supplying general information regarding the County.
The Series 2003 Bonds are secured by the Pledged Revenues as described in the Official Statement.
General Information
The County was established in 1923 by the legislature of the State of Florida (the "State") from
portions of Lee and Monroe Counties. Its territorial limits, as they presently exist, contain approximately
2,026 square miles. In terms of land area, it is the largest county in the State. The County is located on the
southwest coast of the Florida peninsula directly west of the Miami-Fort Lauderdale area. The County
has a 2002 population of 264,475. Principal industries within the County include wholesale and retail
trade, tourism, agriculture, forestry, fishing, cattle ranching and construction. The 2000 U.s. Census
showed an increase in the population of the County of 65% between the years 1990 and 2000.
Board of County Commissioners
The Board of County Commissioners (the "Board") is the principal legislative and governing
body of the County. The Board consists of five County Commissioners; one from each of the five districts
elected for terms of four years. All of the County Commissioners are residents of the County. The
current members of the Board and their expiration of terms of office are:
Commissioner
Office
Term Expires
Tom Henning
Donna Fiala
Jim Coletta
Fred W. Coyle
Frank Halas
Chairman
Vice Chairman
Commissioner
Commissioner
Commissioner
November, 2004
November, 2004
November, 2004
November, 2006
November, 2006
County Manager
The chief administrative official of the County is the County Manager. This official is directly
responsible to the Board for administration and operation of four administrative divisions under the
Board and for execution of all Board policies. The County Milnager directs the administrative divisions
for Community Development Public Services, Public Utilities and Support Services. The County
Manager is also responsible to the Board for the preparation of budgets and for the control of
expenditures of departments under his supervision throughout the budget year.
Budget Process
The Budget Director, as the County's Budget Officer, begins the budget process each February for
the ensuing fiscal year (October 1 to September 30) with the distribution of budget request forms and
instructions to departments and division heads. County division heads and elected officers submit their
proposed expenditures beginning in April for compilation by the Budget Officer no later than July 1 of
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each year and each submission is matched against available revenues. A balanced, proposed budget is
presented to the Board for review within 15 days of receipt of an assessed value certification from the
County's Property Appraiser which is due by July 1. A tentative budget is thereupon adopted within 15
days.
Subsequent to public hearings, a final budget is adopted. (The final budget for the fiscal year
ended September 30, 2003 was adopted by the Board on September 18, 2002.1 Final millage rates are
adopted, usually by late September, and the County's Tax Collector prepares tax bills for mailing on or
after November 1. Upon valid <ldoption, <lll expenditures in the budget constitute appropriations, and
amendments to the budget can be made only in accordance with the provisions of Chapter 129, Florida
Statutes, as amended, and such chapter provides that expenditures in excess of total fund budgets are
unlawful.
Annual Audit
Florida law requires that an annual post audit of each county's accounts and records be
completed within six months of the end of each fiscal year by a firm of independent certified public
accountants retained and paid for by the County. The County retained the firm of KPMG LLP to
undertake the audit for the fiscal year ended September 30, 2002, which is included as APPENDIX C -
Audited Financial Statements For Fiscal Year Ended September 30, 2002" attached to this Official
Statement.
Population
The County has experienced mpid population growth in recent decades. The following table
presents historical and projected population growth for the County, the State, and the United States for
the period of 1960 to 2020:
POPULA nON TRENDS
Population Population United Population
County Percentage State Percentage States Percentage
Population Increase Population Jncrease Population Increase
1960 15,753 4,951,560 179,323,175
1970 38,040 141.5% 6,791,418 37.1 'Yo 203,302,031 13.4%
1980 85,971 126.0 9,746,961 43.5 226,504,825 11.4
1990 152,099 76.9 12,938,071 32.7 250,410,000 10.6
2000 251,377 65.2 15,982,378 23.5 274,634,000 9.7
2010" 343,500 36.6 18,776,400 17.5 297,716,000 8.4
2020" 441,600 28.6 21,683,300 15.5 322,742,000 8.4
"Estimates on County and State population use medium estimates of population growth.
Source: Collier County, Florida; Bureau of Census; and the University of Florida, College of Business
Administration, Bureau of Economic and Business Research, Division of Population Studies.
Most of the growth of Collier County is due to migration. As of April 1, 2000, the estimated
median age of the County's population was 44.1 years according to the 2002 Florida Statistical Abstract,
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University of Florida. The majority of the population is over the age of 18, with the age category 15-44
comprising 35% of the overall population.
COLLIER COUNTY EMPLOYMENT
BY MAJOR INDUSTRY
SeptembL'T 30, 2002
Industry Firms Employee Count(l)
Hotels and Other lodging 68 3,956
Health Care and Social Services 599 11,059
Professional and Business Services 1,911 12,433
Finance, Insurance and Real Estate 1,050 6,026
Arts, Entertainment and Recreation Services 160 4,263
Services - Other 1,001 4,384
Services 4,789 42,121
Eating and Drinking Places 482 7,023
Food Stores 114 3,981
Auto Dealers and Service Stations 184 2,522
Home Furniture and Furnishings 160 949
Retail Trade - Other 454 2,663
Apparel and Accessory Stores 265 1,863
General Merchandise Stores 28 2,293
Building Hardware and Garden 107 2,065
Retail Trade 1,794 23,359
Federal Government 20 667
State Government 44 899
Local Government 22 9,647
Government 86 11,213
Agriculture, Forestry and Fisheries 121 4,378
Construction 1,336 14,525
Manufactu ring 277 2,926
Transportation, Communication and
Public Utilities 301 3,297
Wholesale Trade 389 2,506
Mining 11 63
Other 2.435 27,695
Total 9Jln4 1~4,38.8
(1) Average number of people employed in 2002.
Source: Collier County Comprehensive Annual Financial Report for Fiscal Year ended September 30,
2002; Florida Department of Labor & Employment Security; Bureau of Labor Market Information
ES-202 Report.
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COLLIER CO UNIT EMPLOYMENT lOJ ....,
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(1992-2001)
State of
County Florida
Lnbor Unemployment Unemployment
Year Force Employment Unemployment Rate Rate
1992 75,484 68,339 7,145 8.9%, 8.2%
1993 78,654 72,078 6,576 8.5 7.0
1994 80,566 73,979 6,577 8.2 6.8
1995 81,500 75,839 5,661 6.9 5.4
1996 83,140 78,316 4,824 5.8 5.1
1997 87,526 83,115 4,411 5.0 4.8
1998 92,044 88,224 3,820 4.2 4.3
1999 94,862 91,342 3,250 3.7 3.9
2000 100,339 96,826 3,513 3.5 3.6
2001 108,014 103,793 4,221 3.9 4.8
Source: U.S. Department of Labor, Bureau of Labor Statistics; Division of Employment Security,
Department of Commerce, State of Florida; and Florida Department of Labor nnd Employment
Security, Bureau of Labor Mnrket Information; 2002 [Olorida Statistical Abstract, University of
Florida.
BUILDING PERMIT ACTIV]TIES IN COLLIER COUNTY
(1992-2001)
Single MuIti- Residential
Year Family Units Family Units Valuation{l )
1992 1,949 2,396 $ 402,147
1993 1,702 1,957 385,337
1994 1,964 2,358 449,254
1995 1,957 2,300 501,797
]996 2,318 2,585 447,56..1
1997 2,718 3,324 567,883
1998 2,804 4,040 826,199
1999 3,765 3,777 931,599
2000 4,065 3,905 1,188,310
2001 3,878 4,280 1,093,852
(1) Valuation in thousands of dollars.
Source: 2002 Florida Statistical Abstract, University of Florida; Years 1992 through 2001; University of
Florida Bureau of Economic and Business Research, Building Permit Activity in Florida.
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Agriculture
Agriculture is a dominant factor in the economy of the County. Rainfall averages about 52 inches
annually with most of the precipitation occurring during the late spring and summer. The high yearly
rainfall and year-round mild temperature enable agriculture to be a productive sector of the County
economy. The agricultural industry represents seven percent of the workforce. Farming activities are
located approximately 40 miles inland primarily centered around the community of Immokalee. Major
crops include tomatoes, peppers, cucumbers, melons and citrus. Beef cattle are also a significant farming
commodity.
Tourism
Tourism is a major factor in the economy of the County. Visitors to the County enjoy its Gulf of
Mexico beaches, golf, tennis and other attractions. Everglades National Park, the United States' only
subtropical National Park, located near Naples, comprises a substantial portion of the County. Collier-
Seminole Park and Corkscrew Swamp are also located nearby. Salt water fishing in the Gulf of Mexico,
as well as fresh water fishing, makes the many lakes and waterways popular vacation spots. The County
is regarded as one of the largest shelling areas in the United States.
Transportation
The County is served by U.S. Highway 41 (otherwise known as the Tamiami Trail) and Interstate
75, which links Naples to the east coast of Florida and intersects U.S. Highway 27, providing access to the
Florida Turnpike. Interstate 75 also provides access to the County from the North. Greyhound Bus Lines
connects the County to illl points within the State.
Air service is available at the Naples Airport owned by the City of Naples and covers an area of
approximately 650 acres. The airport has two lighted 5,000 feet hard surfaced runways, each 150 feet
wide. Commuter airlines offer regulilrly scheduled flights to Miami and Tampa. Air service at the
Southwest International Airport near Fort Myers, 35 miles north of Naples, reaches many major cities. In
addition, the County owns and operates three public airports: the Marco Island Executive Airport and the
Immokalee and Everglades City Airparks.
Educational System
The County school system serves approximately 36,000 students in 37 schools. The public
schools provide a varied adult education program and a special program for pre-school children. There
are several private and parochial schools in the County offering classes from kindergarten through the
twelfth grade. Edison Community College's main campus in Fort Myers, with a branch campus in
Naples, offers technical training as well as college preparation for students. Although not located within
the County, Florida Gulf Coast College, the tenth college in the State University System, is operating in
Lee County, immediately north of the County.
Medical Facilities
Naples Community Hospital, a non-profit, private corporation provides health services to the
residents of the County. It opened as a 50-bed facility in 1956, financed exclusively by contributions from
members of the community. Since 1956, Naples Communily Hospital has grown to encompass
approximately 422,000 square feet and include two six-story towers that house Naples Community
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Hospital's 408 licensed beds and patient care ancillary services and a two-story support services wing
located between the two towers. Hospital services are also provided in the Carpenter-Briggs Radiation
Therapy Center located across the street from Naples Community Hospital, at the Golden Gate Urgent
Care Center located in leased space approximately seven miles from Naples Community Hospital, and in
several other outpatient facilities that provide urgent care, rehabilitation, wellness and infusion services.
The Cleveland Clinic operates a hospital in the northern portion of the County.
The Collier County Health Department operates in every community in the County under the
direction of a licensed physician and with a staff of trained specialists, including public health workers,
nurses, sanitarians and clinical psychologists.
COLLIER COUNTY
FINANCIAL AND ECONOMIC DATA
(1993-2002)
Per Bank
Fiscal Percent Capita Deposits
Year Population(') Increase Income (OOO's)ll)
1993 174,664 3.5% $29,307 $2,097,133
1994 180,540 3.4 30,201 2,707.107
1995 186,641 3.4 N/A 2,892,389
1996 197,400 5.8 30,201 3,112,346
1997 202,903 2.7 30,906 3,463,731
1998 210,095 3.5 32,878 3,767,516
1999 219,685 4.6 34,830 4,102,784
2000 229,821 4.6 36,210 4,658,978
2001 251,377 9.3 38,916 5,153,782
2002 264,475 5.2 40,121 5,977,651
(1) Florida Bankers Association.
N/A = Data not currently available
Source: Collier County Comprehensive Annual Financial Report for Fiscal Year ending September 30,
2002. Population figures are estimates used by the County on an annual basis. Actual
population according to the 20lXl United States Census was 281,422.
[Remainder of page intentionally left blank)
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Assessed Valuation
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The following table shows the assessed value and taxable value for operating millage in each of
the past ten years.
TOT AL ASSESSED AND TAXABLE VALUE
IN COLLIER COUNTY
(1993-2002)
County Taxable County Taxable
Fiscal Value Real Value Personal
Year Property Only Property Only
2002 $38,085,169,570 $1,405,140,367
2001 32,057,961,136 1,336,930,733
2000 26,493,401,264 1,248,512,604
1999 23,271,327,045 1,150,774,033
1998 20,304,971,514 1,037,538,724
1997 18,547,873,169 981,119,415
1996 17,146,475,680 936,566,144
1995 16,038,210,161 892,359,888
1994 15,130,183,723 851,954,071
1993 14,506,009,883 806,965,166
Total
Taxable V alue(1)
$39,490,423,314
33,395,002,460
27,742,021,485
24,422,201 ,235
21,342,594,299
19,529,075,510
18,083,131,561
16,930,661,056
15,982,193,801
15,313,053,072
Total
Assessed Value(2)
$49,671,844,946
41,333,321,441
33,902,799,963
29,830,939,079
25,777,151,470
23,436,330,545
21,751,280,540
20,463,371,228
19,387,178,081
18,440,257,462
Ratio of
Taxable Value
To Total
Assessed Value
79.50%
80.79
81.82
81.86
82.79
83.33
83.14
82.74
82.44
83.04
(1) These figures include Centrally Assessed property.
(2) Just Value is the Market or Assessed value. From this you subtract exemptions, classified
agricultural property and capped homestead value to arrive at taxable value.
Source: Collier County Property Appraiser's Office.
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The following table contains the property tax rates for the tax years 1993 through 2002.
COLLIER COUNTY, FLORIDA
PROPERTY TAX RATES - ALL DIRECT AND OVERLAPPING GOVERNMENTS(1)
(1993-2002)
(Unaudited)
COLLIER COUNTY OTHER
Special Debt Capital
Fiscal General Revenue Service Projects School Ind~pendent
Year Fund Fund Funds Fund Total District Districts Total
1993 3.2580 0.7726 0.1094 0.5474 4.6874 8.0000 1.4455 14.1329
1994(2) 3.6729 0.7823 0.1106 0.0000 4.5658 8.0860 1.5648 14.2166
1995 3.6028 0.6834 0.1062 0.0000 4.3924 8.3227 1 .5028 14.2179
1996 3.4918 0.7091 0.0989 0.0000 4.2998 8.6000 1.5353 14.4351
1997 3.7266 0.7567 0.0490 0.0000 4.5323 8.6918 1.5420 14.7661
1998 3.6838 0.7604 0.0452 0.0000 4.4894 8.4298 1 .5941 14.5133
1999 3.5540 0.6689 0.0420 0.0000 4.2649 8.5173 1.4801 14.2623
2000 3.5086 0.6419 0.0355 0.0000 4.1860 7.7661 1.4654 13.4175
2001 3.5050 0.6624 0.0318 0.0000 4.1992 7.7334 1.4607 13.3933
2002 3.8797 0.6238 0.0257 0.0000 4.5292 7.1464 1.3813 13.0569
(1) Basis for property tax rates is 1 mill per $1,000 of assessed value. Property is assessed as of
January 1 and taxes based on those assessments are levied according to the tax rate in effect that
tax year and become due on November 1. Therefore, assessments and tax levies applicable to a
certain tax year are collected in the fiscal year ending during the following calendar year.
(2) Beginning with fiscal year 1994 the millage rates for capital projects are included in the General
Fund millage rate.
Source: Collier County Comprehensive Annual Financial Rl'port for Fiscal Year ending September 30,
2002.
[Remainder of page intentionally left blank I
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APPENDIX B
AUDITED FINANCIAL STATEMENTS FOR
FISCAL YEAR ENDED SEPTEM BER 30, 2002
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APPENDIX C
SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION
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...
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APPENDIX 0
FORM OF BOND INSURANCE POLICY
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APPENDIX E
FORM OF 2003 RESERVE ACCOUNT INSURANCE POLICY
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APPENDIX F
2002 RESERVE ACCOUNT INSURANCE POLICY
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APPENDIX G
FORM OF BOND COUNSEL OPINION
APPENDIX H
FORM OF CONTINUING DISCLOSURE CERTIFICATE
J: \Bonds\ 439903 \P053.doc
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EXHIBIT E
FORM OF ESCROW DEPOSIT AGREEMENT
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ESCROW DEPOSIT AGREEMENT
ESCROW DEPOSIT AGREEMENT, dated as of October 1,2003, by and between
COLLIER COUNTY, FLORIDA (the "County"), and FIFTH THIRD BANK (the
"Escrow Agent"), a state banking association organized and existing under the laws of the
State of Ohio, having its designated corporate trust office in Cincinnati, Ohio, as escrow
agent hereunder.
WHEREAS, the County has heretofore issued its Collier County, Florida Capital
Improvement Revenue Refunding Bonds, Series 1992 (the "Refunded Bonds") pursuant to
Resolution No. 85-107 adopted on April 3D, 1985, as amended and supplemented
(collectively, the "Resolution"); and
WHEREAS, the County has determined to exercise its option under the Resolution to
refund all of the Refunded Bonds; and
WHEREAS, the County has determined to issue its $ Collier County,
Florida Capital Improvement and Refunding Revenue Bonds, Series 2003 (the "Series 2003
Bonds") pursuant to the Resolution, a portion of the proceeds of which Series 2003 Bonds,
together with other legally available moneys of the County, will be used, other than a cash
deposit, to purchase certain noncallable United States Treasury obligations in order to
provide payment for the Refunded Bonds and discharge and satisfy the pledge of the Pledged
Revenues (as defined in the Resolution) and the covenants, agreements and other obligations
of the County under the Resolution in regard to such Refunded Bonds; and
WHEREAS, the issuance of the Series 2003 Bonds, the purchase by the Escrow
Agent of the hereinafter defined Escrow Securities, the deposit of such Escrow Securities
into an escrow deposit trust fund to be held by the Escrow Agent and the discharge and
satisfaction of the pledge of the Pledged Revenues and the covenants, agreements and other
obligations of the County under the Resolution in regard to the Refunded Bonds shall occur
as a simultaneous transaction; and
WHEREAS, this Agreement is intended to effectuate such simultaneous transaction;
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
SECTION 1. PREAMBLES. The County represents that the recitals stated above
are true and correct, and the same are incorporated herein.
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SECTION 2. RECEIPT OF RESOLUTION AND VERIFICATION
REPORT. Receipt of a true and correct copy of the above-mentioned Resolution and this
Agreement is hereby acknowledged by the Escrow Agent. The applicable and necessary
provisions of the Resolution, including, without limitation, Sections 12 and 27 thereof, are
incorporated hcrein by reference. The Escrow Agent also acknowledges receipt of the
verification report of Causey Demgen & Moore Inc., dated , 2003 (the
"Verification Report"). Refcrence herein to or citation hercin of any provisions of the
Resolution or the Verification Report shall be deemed to incorporate the same as a part
hereof in the same manner and with the same effect as if the same were fully set forth herein.
SECTION 3. DISCHARGE OF PLEDGE OF HOLDERS OF REFUNDED
BONDS. In accordance with Section 27 of the Resolution, the County by this writing
exercises its option to cause the pledge of the Pledged Revenues and all covenants,
agreements and other obligations of the County to the holders of the Refunded Bonds under
the Resolution to cease, terminate and become void and be discharged and satisfied.
SECTION 4. ESTABLISHMENT OF ESCROW FUND. There is hereby
created and established with the Escrow Agent a special, segregated and irrevocable escrow
deposit trust fund designated the "Collier County, Florida Capital Improvcment Revenue
Refunding Bonds, Series 1992 Escrow Deposit Trust Fund" (thc "Escrow Fund"). The
Escrow Fund shall be held in the custody ofthe Escrow Agcnt as a trust fund for the benefit
of the holders of the Refunded Bonds, separate and apart from other funds and accounts of
the County and the Escrow Agent. The Escrow Agent hereby accepts the Escrow Fund and
acknowlcdges the receipt of and deposit to the credit of the Escrow Fund the sum of
$ from the County from proceeds of the Series 2003 Bonds (the "Bond
Proceeds"), and the sum of $ received from the County from certain moneys on
deposit in the funds and accounts established pursuant to the Resolution for the benefit ofthe
holders of the Refunded Bonds (the "County Moneys").
SECTION 5. DEPOSIT OF MONEYS AND SECURITIES IN ESCROW
FUND. The County hereby directs the use of the Bond Proceeds and County Moneys as
provided in this Section 5. The Escrow Agent represcnts and acknowledges that,
concurrently with the deposit of the Bond Proceeds and County Moneys under Section 4
above, it has used all of the Bond Proceeds and $ of the County Moneys to
purchase on behalf of and for the account of the County certain United States Treasury
obligations -- State and Local Government Series (collectively, togcther with any other
securities which may be on deposit, from time to time, in the Escrow Fund, the "Escrow
Securities"), which are described in Schedule A hcreto, and the Escrow Agent will deposit
such Escrow Securities and $ of the County Moneys in cash (the "Cash Deposit") in
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the Escrow Fund. All Escrow Securities shall be noncallable, direct obligations of the United
States of America.
In the event any of the Escrow Securities described in Schedule A hereto are not
available for delivery on ,2003, the Escrow Agent may, at the written direction
of the County and with the approval of Bond Counsel, substitute other United States
Treasury obligations and shall credit such other obligations to the Escrow Fund and hold
such obligations until the aforementioned Escrow Securities have been delivered. Bond
Counsel shall, as a condition precedent to giving its approval, require the County to provide
it with a revised Verification Report in regard to the adequacy of the Escrow Securities,
taking into account the substituted obligations to pay the Refunded Bonds in accordance with
the terms hereof. The Escrow Agent shall in no manner be rcsponsible or liable for failure or
delay of Bond Counselor the County to promptly approve the substitutions of other United
States Treasury obligations for the Escrow Fund.
SECTION 6. SUFFICIENCY OF ESCROW SECURITIES AND THE CASH
DEPOSIT. In reliance upon the Verification Report, the County represents that the Cash
Deposit and thc interest on and the principal amounts successively maturing on the Escrow
Securities in accordance with their terms (without consideration of any reinvestment of such
maturing principal and interest) are sufficient such that moneys will be available to the
Escrow Agent in amounts sufficient and at the times required to pay the amounts of principal
of, redemption premium, if any, and interest due and to become due on the Refunded Bonds
as described in Schedule B attached hereto. If the Escrow Securities and the Cash Deposit
shall be insufficient to make such payments, the County shall timely deposit to the Escrow
Fund, solely from legally available funds ofthe County, such additional amounts as may be
required to pay the Refunded Bonds as described in Schedule B hereto. Notice of any
insufficiency shall be given by the Escrow Agent to thc County as promptly as possible, but
the Escrow Agent shall in no manner be rcsponsible for the County's failure to make such
deposits.
SECTION 7. ESCROW SECURITIES AND THE CASH DEPOSIT IN
TRUST FOR HOLDERS OF REFUNDED BONDS. The deposit of the Escrow Securities
and the Cash Deposit in the Escrow Fund shall constitute an irrevocable deposit of
Obligations of the United States of America (as defined in the Resolution) and cash in trust
solely for the payment of the principal of, redemption premium, if any, and interest on the
Refunded Bonds at such times and in such amounts as set forth in Schedule B hereto, and the
principal of and interest earnings on such Escrow Securities and the Cash Deposit shall be
used solely for such purpose.
SECTION 8. ESCROW AGENT TO PAY REFUNDED BONDS FROM
ESCROW FUND. The County hereby directs, and the Escrow Agent hereby agrees, that it
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will take all actions r~quired to be taken by it under the provisions of the Resolution
referenced in this Agreement, including the timely transfer of money to the Paying Agent for
the Refunded Bonds ( ) as provided in the Resolution, in order to effectuate
this Agreement and to pay the Refunded Bonds in the amounts and at the times provided in
Schedule B hereto. The Escrow Securities and the Cash Deposit shall be used to pay the
principal of, redemption premium, if any, and interest on the Refunded Bonds as the same
may mature or be redeemed. If any payment date shall be a day on which either the Paying
Agent for the Refunded Bonds ( ) or the Escrow Agent is not open for the
acceptance or delivery of funds, then the Escrow Agent may make payment on the next
business day. The liability of the Escrow Agent for the payment of the principal of,
redemption premium, ifany, and interest on the Refunded Bonds pursuant to this Agreement
shall be limited to the application of the Escrow Securities and the Cash Deposit and the
interest earnings thereon available for such purposes in the Escrow Fund.
SECTION 9. REINVESTMENT OF MONEYS AND SECURITIES IN
ESCROW FUND. Moneys dcposited in the Escrow Fund shall be invested only in the
Escrow Securities listed in Schedule A hereto and the Cash Deposit and, except as provided
in Section 5 hercof and this Section 9, neither the County nor the Escrow Agent shall
otherwise invest or reinvest any moneys in the Escrow Fund.
Except as provided in Section 5 hereof and in this Section 9, the Escrow Agent may
not sell or otherwise dispose of any or all of the Escrow Securities or the Cash Deposit in the
Escrow Fund and reinvest the proceeds thereof in other securities nor may it substitute
securities for any ofthe Escrow Securities, except upon written direction of the County and
where, prior to any such reinvestment or substitution, the Escrow Agcnt has received from
the County the following:
(a) a written verification report by a firm of independent certified public
accountants, of recognized standing, appointed by the County and acceptable
to the Escrow Agent, to the effect that after such reinvestment or substitution
the principal amount of Escrow Securities, together with the interest therein,
will bc sufficient to pay the Refunded Bonds as described in Schedule B
hcreto; and
(b) a written opinion of nationally recognized Bond Counsel to the effect that (i)
such investment will not cause the Series 2003 Bonds or the Refunded Bonds
to be "arbitrage bonds" within the meaning of Section 148 of the Internal
Revenue Code, as amended, and the regulations promulgated thereunder or
otherwise cause the interest on the Refunded Bonds or the Series 2003 Bonds
to be included as gross income for purposes offederal income taxation, and (ii)
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such investment does not violate any provision of Florida law or of the
Resolution.
The above-described verification report need not be provided in the event the County
purchases Escrow Securities with the proceeds of maturing Escrow Securities and such
purchased Escrow Securities mature on or before the next interest payment date for the
Refunded Bonds and have a face amount which is at least equal to the eash amount invested
in such Escrow Securities.
In the event the above-referenced verification concludes that there are surplus moneys
in the Escrow Fund, such surplus moneys shall be released to the County upon its written
direction. The Escrow Fund shall continue in effect until the date upon which the Escrow
Agent makes the final payment to the Paying Agent for the Refunded Bonds in an amount
sufficient to pay the Refunded Bonds as described in Schedule B hereto, whereupon the
Escrow Agent shall sell or redeem any Escrow Securities remaining in the Escrow Fund, and
shall remit to the County the proceeds thereof, together with all other money, if any, then
remaining in the Escrow Fund.
SECTION 10. REDEMPTION OF CERTAIN REFUNDED BONDS. The
County hereby irrevocably instructs the Escrow Agent to direct, on behalf of the Issuer, that
the Registrar and Paying Agent for the Refunded Bonds ( _) give at the
appropriate times the notice or notices, ifany, required by the Resolution in connection with
the redemption of the Refunded Bonds. Such notice of redemption shall be given by the
Registrar for such Refunded Bonds in accordance with the Resolution. The Refunded Bonds
shall be redeemed on ,2003 at a redemption price equal to 101 % of the principal
amount thereof plus interest accrued to the redemption date.
SECTION 11. ESCROW FUND IRREVOCABLE. The Escrow Fund hereby
created shall be irrevocable and the holders ofthe Refunded Bonds shall have an express lien
on all Escrow Securities and the Cash Deposit deposited in the Escrow Fund pursuant to the
terms hereof and the interest earnings thereon until paid out, used and applied in accordance
with this Agreement and the Resolution. Neither the County nor the Escrow Agent shall
cause nor permit any other lien or interest whatsoever to be imposed upon the Escrow Fund.
SECTION 12. AMENDMENTS TO AGREEMENT. This Agreement is made for
the benefit of the County and the holders from time to time of the Refunded Bonds and it
shall not be repealed, revoked, altered or amended without the written consent of all such
holders and the written consent of the Escrow Agent; provided, however, that the County and
the Escrow Agent may, without the consent of, or notice to, such holders, enter into such
agreements supplemental to this Agreement as shall not adversely affect the rights of such
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holders and as shall not be inconsistent with the terms and provisions of this Agreement, for
anyone or more of the following purposes:
(a) to cure any ambiguity or formal defect or omission in this Agreement;
(b) to grant, or confer upon, the Escrow Agent for the benefit ofthe holders of the
Refunded Bonds, any additional rights, remedies, powers or authority that may
lawfully be granted to, or conferred upon, such holders or the Escrow Agent;
and
(c) to subject to this Agreement additional funds, securities or properties.
The Escrow Agent shall be entitled to rely exclusively upon an opinion of nationally
recognized Bond Counsel with respect to compliance with this Section l2, including the
extent, ifany, to which any change, modification or addition affects the rights of the holders
of the Refunded Bonds, or that any instrument executed hereunder complies with the
conditions and provisions of this Section 12.
SECTION 13. FEES AND EXPENSES OF ESCROW AGENT;
INDEMNIFICA TION. In consideration of the services rendercd by the Escrow Agent
under this Agreement, the County agrees to and shall pay to the Escrow Agent the fees and
expenses as shall be agreed to in writing by the parties hereto. The Escrow Agent shall have
no lien whatsoever upon any of the Escrow Securities in said Escrow Fund for the payment
of such proper fees and expenses. The County further agrees to indemnify and save the
Escrow Agent harmless, to the extent allowed by law, against any liabilities which it may
incur in the exercise and performance of its powers and duties hereunder, and which are not
due to its negligence or misconduct. Indemnification provided under this Section 13 shall
survive the tennination of this Agreement.
Whenever the Escrow Agent shall deem it necessary or desirable that a matter be
proved or established prior to taking, suffering or omitting any action under this Agreement,
such matter may be deemed to be conclusively established by a certificate signed by an
authorized officer of the County. The Escrow Agent may conclusively rely, as to the
correctness of statements, conclusions and opinions therein, upon any certificate, report,
opinion or other document furnished to the Escrow Agent pursuant to any provision of this
Agreement; the Escrow Agent shall be protected and shall not be liable for acting or
proceeding, in good faith, upon such reliance; and the Escrow Agent shall be under no duty
to make any investigation or inquiry as to any statements contained or matters referred to in
any such instrument. The Escrow Agent may consult with counsel, who may be counsel to
the County or independent counsel, with regard to legal questions, and the opinion of such
counsel shall be full and complete authorization and protection in respect of any action taken
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or suffered by it hereunder in good faith in accordance herewith. Prior to retaining such
independent counsel, the Escrow Agent shall notify the County of its intention.
The Escrow Agent and its successors, agents and servants shall not be held to any
personal liability whatsoever, in tort, contract or otherwise, by reason of the execution and
delivery of this Agreement, the establishment of the Escrow Fund, the acceptance and
disposition of the various moneys and funds described herein, the purchase, retention or
payment, transfer or other application of funds or securities by the Escrow Agent in
accordance with the provisions ofthis Agreement or any non-negligent act, omission or error
of the Escrow Agent made in good faith in the conduct of its duties. The Escrow Agent shall,
however, be liable to the County and to holders of the Refunded Bonds to the extent of their
respective damages for negligent or willful acts, omissions or errors of the Escrow Agent
which violate or fail to comply with the terms of this Agreement. The duties and obligations
of the Escrow Agent shall be determined by the express provisions of this Agreement.
SECTION 14. REPORTING REQUIREMENTS OF ESCROW AGENT. As
soon as practicable after ,2003, the Escrow Agent shall forward in writing to
the County a statement in detail of the activity of the Escrow Fund.
SECTION 15. RESIGNATION OR REMOV AL OF ESCROW AGENT. The
Escrow Agent, at the time acting hereunder, may at any time resign and be discharged from
the duties and obligations hereby created by giving not less than 30 days' written notice to the
County and mailing notice thereof, specifying the date when such resignation will take effect
to the holders of all Refunded Bonds then outstanding, but no such resignation shall take
effect unless a successor Escrow Agent shall have been appointed by the holders of a
majority in aggregate principal amount of the Refunded Bonds then outstanding or by the
County as hereinafter provided and such successor Escrow Agent shall have accepted such
appointment, in which event such resignation shall take effect immediately upon the
appointment and acceptance of a successor Escrow Agent.
The Escrow Agent may be replaced at any time by an instrument or concurrent
instruments in writing, delivered to the Escrow Agent and signed by either the County or the
holders of a majority in aggregate principal amount ofthe Refunded Bonds then outstanding.
Such instrument shall provide for the appointment of a successor Escrow Agent, which
appointment shall occur simultaneously with the removal of the Escrow Agent.
In the event the Escrow Agent hereunder shall resign or be removed, or be dissolved,
or shall be in the course of dissolution or liquidation, or otherwise become incapable of
acting hereunder, or in case the Escrow Agent shall be taken under the control of any public
officer or officers, or of a reccivcr appointed by a court, a successor may be appointed by the
County or by the holders ofa majority in aggregate principal amount of the Refunded Bonds
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then outstanding by an instrument or concurrent instruments in writing, signed by such
holders, or by their attorneys in fact, duly authorized in writing. In the event the holders of
the Refunded Bonds shall appoint a successor Escrow Agent, the County may appoint a
temporary Escrow Agent to fill such vacancy until a successor Escrow Agent shall be
appointed by the holders of a majority in aggregate principal amount ofthe Refunded Bonds
then outstanding in the manner above provided, and any such temporary Escrow Agent so
appointed by the County shall immediately and without further act be superseded by the
Escrow Agent so appointed by such holders. The County shall mail notice of any such
appointment made by it at the times and in the manner described in the first paragraph of this
Section 15.
In the event that no appointment of a suecessor Escrow Agent or a temporary
successor Escrow Agent shall have been made by such holders or the County pursuant to the
foregoing provisions of this Section 15 within 30 days after written notice of resignation of
the Escrow Agent has been given to the County, the holder of any of the Refunded Bonds or
any retiring Escrow Agent may apply to any court of competent jurisdiction for the
appointment of a successor Escrow Agent, and such court may thereupon, after such notice,
if any, as it shall deem proper, appoint a successor Escrow Agent.
In the event of replacement or resignation of the Escrow Agent, the Escrow Agent
shall remit to the County the prorated portion ofprcpaid fees not yet incurred or payable, less
any termination fees and expenscs at the time of discharge, and shall have no further liability
hereunder and the County shall indemnify and hold harmless Escrow Agent from any sueh
liability, including costs or expenses incurred by Escrow Agent or its counsel.
No successor Escrow Agent shall be appointed unless such successor Escrow Agent
shall be a corporation with trust powers organized under the banking laws of the United
States or any State, and shall have at the time of appointment capital and surplus of not less
than $30,000,000.
Every successor Escrow Agent appointed hereunder shall execute, acknowledge and
deliver to its predecessor and to the County an instrument in writing accepting such
appointment hereunder and thereupon such successor Escrow Agent, without any further act,
deed or conveyance, shall become fully vested with all the rights, immunities, powers, trusts,
duties and obligations of its predecessor; but such predecessor shall nevertheless, on the
written request of such successor Escrow Agent or the County execute and deliver an
instrument transferring to such successor Escrow Agent all the estates, properties, rights,
powers and trust of such predecessor hereunder; and every predecessor Escrow Agent shall
deliver all securities and moneys held by it to its successor; provided, however, that before
any such delivery is required to be made, all fees, advances and expenses of the retiring or
removed Escrow Agent shall be paid in full. Should any transfer, assignment or instrument
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in writing from the County be required by any successor Escrow Agent for more fully and
certainly vesting in such successor Escrow Agent the estates, rights, powers and duties
hereby vested or intended to be vested in the predecessor Escrow Agent, any such transfer,
assignment and instruments in writing shall, on request, be executed, acknowledged and
delivered by the County.
Any corporation into which the Escrow Agent, or any successor to it in the trusts
created by this Agreement, may be merged or converted or with which it or any successor to
it may be consolidated, or any corporation resulting from any merger, conversion,
consolidation or tax-free reorganization to which the Escrow Agent or any successor to it
shall be a party shall be the successor Escrow Agent under this Agreement without the
execution or filing of any paper or any other act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
SECTION 16. TERMINATION OF AGREEMENT. This Agreement shall
terminate when all transfers and payments required to be made by the Escrow Agent under
the provisions hereof shall have been made. Upon such termination, all moneys remaining in
the Escrow Fund shall be released to the County.
SECTION 17. GOVERNING LAW. This Agreement shall be governed by the
applicable laws of the State of Florida.
SECTION 18. SEVERABILITY. If anyone or more of the covenants or
agreements provided in this Agreement on the part of the County or the Escrow Agent to be
performed should be determined by a court of competent jurisdiction to be contrary to law,
such covenant or agreement shall be deemed and construed to be scverable from the
remaining covenants and agreements herein contained and shall in no way affect the validity
of the remaining provisions of this Agreement.
SECTION 19. COUNTERPARTS. This Agreement may be executed in several
counterparts, all or any of which shall be rcgarded for all purposes as one original and shall
constitute and be but one and the same instrument.
SECTION 20. NOTICES. Any notice, authorization, request or demand required
or permitted to be given in accordance with the terms of this Agreement shall be in writing
and sent by registered or certified mail addressed to:
Collier County, Florida
3301 Tamiami Trail East
Naples, Florida 34112
Attn: Finance Director
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Fifth Third Bank
MD lOAT60
38 Fountain Square Plaza
Cincinnati, Ohio 45263
Attn: Corporate Trust Department
IN WITNESS WHEREOF, the parties hereto have each caused this Escrow Deposit
Agreement to be executed by their duly authorized officers and appointed officials and their
seals to be hereunder affixed and attested as of the date first written herein.
COLLIER COUNTY, FLORIDA
(SEAL)
Chairman, Board of County Commissioners of
Collier County, Florida
ATTEST:
Clerk, Board of County Commissioners of
Collier County, Florida
FIFTH THIRD BANK, as Escrow Agent
(SEAL)
By:
Authorized Signatory
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Type
Settlement
Date
ESCROW SECURITIES
Maturity
Date
Par
Amount
[TO COPY FROM VERIFICA TrON REPORT]
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SCHEDULE A
Interest
Rate
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SCHEDULE B
DEBT SERVICE REQUIREMENTS FOR REFUNDED BONDS
Payment Date
Principal
Premium
Interest
Total
[TO COpy FROM VERIFICATION REPORT]
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EXHIBIT F
FORM OF CONTINUING DISCLOSURE CERTIFICATE
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CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosu re Certificate (the "Disclosure Certificate") is executed and delivered by
Collier County, Florida (the "Issuer") in connection with the issunnce of its $ Capital
Improvement and Refunding Revenue Bonds, Series 2003 (the "Bonds"). The Bonds are being issued
pursuant to Resolution No. 85-107 ndopted by the Board of County Commissioners of the Issuer on
April 30, 1985, as amended and supplemented from time to time, and as particularly supplemented by
Resolution No. 03-_ adopted by the Board of County Commissioners of the Issuer on September 23, 2003
(collectively, the "Resolution").
SECTION 1. PURPOSE OF THE DISCLOSURE CERTIFICATE. This Disclosure Certificate is
being executed and delivered by the Issuer for the benefit of the Holders and Beneficial Owners of the
Bonds and in order to assist the Participating Underwriters in complying with the continuing disclosure
requirements of Securities and Exchange Commission Rule 15c2-12.
SECTION 2. DEFINITIONS. In addition to the definitions set forth in the Resolution which
apply to any capitalized term used in this Disclosure Certificate, unless otherwise defined in this Section,
the following capitalized terms shall have the following meanings:
"Annual Report" shnll mean any Annual Report provided by the Issuer pursuant to, and as
described in, Sections 3 and 4 of this Disclosure Certificate.
"Beneficial Owner" shall menn any person which (a) has the power, directly or indirectly, to vote
or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds
through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for
fedewl income tax purposes.
"Dissemination Agent" shall mean the Issuer, or any successor Dissemination Agent designated
in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation.
"Insurer" shall mean Ambac Assurance Corporation, a Wisconsin-domiciled stock insurance
company.
"Listed Events" shall mean nny of the events listed in Section 5(a) of this Disclosure Certificate.
"Nntional Repository" shall mean any Nationally Recognized Municipal Securities Information
Repository for purposes of the Rule. The National Repositories currently approved by the Securities and
Exchange Commission nre set forth in Exhibit B.
"Participating Underwriters" shall mean the original underwriters of the Bonds required to
comply with the Rule in connection with offering of the Bonds.
"Repository" shall mean each National Repository and each State Repository.
"Rule" shall mean the continuing disclosure requirements of Rule 15c2-12 adopted by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be
amended from time to time.
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"State" shall mean the State of Florida.
"State Repository" shall mean any public or private repository or entity designated by the State as
a state information depository for the purpose of the Rule and recognized as such by the Securities and
Exchange Commission. As of the date of this Certificate, there is no State Repository.
SECTION 3. PROVISION OF ANNUAL REPORTS.
(a) The Issuer shall, or shall cause the Dissemination Agent to, not later than each
April 30th, commencing April 30, 2004 with respect to the report for the 2003 fiscal year, provide to each
Repository and the Insurer an Annual Report which is consistent with the requirements of Section 4 of
this Disclosure Certificate. The Annual Report may be submitted as a single document or as separate
documents comprising a package, and may cross-reference other information as provided in Section 4 of
this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted
separately from the balance of the Annual Report and later than the date required above for the filing of
the Annual Report if they are not available by that date provided, further, in such event unaudited
financial statements are required to be delivered as part of the Annuall\eport in accordance with Section
4(a) below. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as for
a Listed Event under Section S(c).
(b) Not later than fifteen (IS) Business Days prior to the date set forth in (a) above,
the Issuer shall provide the Annual Report to the Dissemination Agent (if other than the Issuer). If the
Issuer is unable to provide to the Repositories and the Insurer an Annual Report by the date required in
subsection (a), the Issuer shall send a notice to (i) each National Repository or the Municipal Securities
Rulemaking Board, and (ii) the State Repository in substantially the form attached as Exhibit A.
(c) The Dissemination Agent shall:
(i) determine each year prior to the date for providing the Annual Report the name
and address of each National Repository and the State Repository, if any; and
(ii) if the Dissemination Agent is other than the Issuer, file a report with the Issuer
certifying that the Annual Report has been provided pursuant to this Disclosure Certificate,
stating the date it was provided and listing all the Repositories and the Insurer to which it was
provided.
SECTION 4. CONTENT OF ANNUAL REPORTS. The Issuer's Annual Report shall contain or
include by reference the following:
(a) the audited financial statements of the Issuer for the prior fiscal year, prepared in
accordance with generally accepted accounting principles as promulgated to apply to governmental
entities from time to time by the Governmental Accounting Standards Board. If the Issuer's audited
financial statements are not available by the time the Annual Report is required to be filed pursuant to
Section :1(a), the Annual Report shall contain unaudited financial statements in a format similar to the
financial statements contained in the final Official Statement dated , 2003 (the "Official
Statement"), and the audited financial statements shall be filed in the same manner as the Annual Report
when they become available; and
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(b) updates to the following historical financial information and operating data presented in
tabular form in the Official Statement entitled "Distribution Percentages," "Historical Receipts of Sales Tax
Revenues by the County," and "Pro-Forma Debt Service Coverage."
The information provided under Section 4(b) may be included by specific reference to other
documents, including official statements of debt issues of the issuer or related public entities, which have
been submitted to each of the Repositories or the Securities and Exchange Commission. If the document
included by reference is a final official statement, it must be available from the Municipal Securities
Rulemaking Board. The Issuer sh<lll clearly identify each such other document so included by reference.
SECTION 5. REPORTING OF SIGNIFICANT EVENTS.
(a) Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be
given, notice of the occurrence of any of the following events with respect to the Bonds, if material:
1. principal and interest payment delinquencies;
2. non-payment related defaults;
3. unscheduled draws on the debt service reserves reflecting financial difficulties;
4. unscheduled draws on credit enhancements reflecting financial difficulties;
5. substitution of credit or liquidity providers, or their failure to perform;
6. adverse tax opinions or events affecting the tax-exempt status of the Bonds;
7. modifications to rights of the holders of the Bonds;
8. Bond calls (other than scheduled mandatory redemption);
9. defeasances;
10. release, substitution, or sale of property securing repayment of the Bonds;
1]. ratings changes; and
12. notice of any failure on the part of the Issuer to meet the requirements of Section
3 hereof.
(b) Whenever the Issuer obtains knowledge of the occurrence of a Listed Event, the
Issuer shall promptly determine if such event would be material under applicable federal securities laws;
provided, however, that any event under clauses 4, 5, 6, 10, 11 and 12 above shall always be deemed to be
material.
(c) If the Issuer determines that knowledge of the occurrence of a Listed Event
would be material under applicable federal securities laws, the Issuer shall promptly file a notice of such
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occurrence wilh (i) each National Repository or the Municipal Securities Rulemaking Board, (ii) the
Insurer, and (iii) the State Repository.
SECTION 6. TERMINATION OF REPORTING OBLIGAT]ON. The Issuer's obligations under
this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full
of all of the Bonds or if the Rule is repealed or no longer in effect. If such termination occurs prior to the
final maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a
Listed Event under Section 5(c).
SECTION 7. DISSEM]NA T]ON AGENT. The Issuer may, from time to time, appoint or engage a
Dissemination Agent to assist il in carrying out its obligations under this Disclosure Certificate, and may
discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent.
The Dissemination Agent shall not be responsible in any mnnner for the content of any notice or report
prepnred by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be
the Issuer.
SECTION 8. AMENDMENT; WAIVER. Notwithstanding any other provision of this Disclosure
Certificate, the Issuer may amend this Disclosure CertificCite, and any provision of this Disclosure
Certificate may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiver relates to the provisions of Sections 3(a), 4, or 5(a), it
may only be made in connection with a change in circumstances that arises from a change in legal
requirements, change in law, or ch,mge in the identity, nature or status of the Issuer, or the type
of business conducted;
(b) The undertaking, as nmended or taking into account such waiver, would, in the
opinion of nationally recognized bond counsel, have complied with the requirements of the Rule
at the time of the original issuance of the Bonds, after taking into account any amendments or
interpretations of the Rule, as well as any change in circumstances; and
(c) The amendment or waiver either (i) is approved by the holders or Beneficial
Owners of the Bonds in the same manner as provided in the Resolution for amendments to the
Resolution with the consent of holders or Beneficial Owners, or (ii) does not, in the opinion of
nationally recognized bond counsel, materially impair the interests of the holders or Beneficial
Owners of the Bonds.
]n the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall
describe such amendment in the next Annual Report, and shall include, as applicable, a narrative
explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a
change of accounting principles, on the presentation) of financial information or operating data being
presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed
in preparing financial statements, (i) notice of such change shall be given in the same manner as for a
Listed Event under Section 5(c), and (ii) the Annual Report for the year in which the change is made
should present a comparison (in narrative form and also, if feasible, in quantitative form) between the
financial statements as prepared on the basis of the new accounting principles and those prepared on the
basis of the former accounting principles.
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SECTION 9. ADDITIONAL INFORMATION. Nothing in this Disclosure Certificate shall be
deemed to prevent the Issuer from disseminating any other information, using the means of
dissemination set forth in this Disclosure Certificate or any other means of communication, or including
any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that
which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any
Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required
by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such
information or include it in any future Annual Report or notice of occurrence of a Listed Event.
SECTION 10. DEFAULT. In the event of a failure of the Issuer to comply with any provision of
this Disclosure Certificate, any holder or Beneficial Owner of the Bonds may take such actions as may be
necessary and appropriate, including seeking mandamus or specific performance by court order, to cause
the Issuer to comply with its obligations under this Disclosure Certificate; provided, however, the sole
remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with the
provisions of this Disclosure Certificate shall be an action to compel performance, A default under this
Disclosure Certificate shall not be deemed an Event of Default under the Resolution.
SECTION 11. DUTIES, IMMUNITIES AND LIABILITIES OF DISSEMINATION AGENT. The
Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate,
and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees
and agents, harmless against loss, expense and liabilities which it may incur arising out of or in the
exercise or perfonnance of its powers and duties hereunder, including the costs and expenses (including
attorneys fees) of defending against any claim of liability, but excluding liabilities due to the
Dissemination Agent's negligence or willful misconduct. 'The obligations of the Issuer under this Section
shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.
SECTION 12. BENEFICIARIES. This Disclosure Certificate shall inure solely to the benefit of the
Issuer, the Dissemination Agent, the Participating Underwriters, the Insurer and holders and Beneficial
Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
Dated:
.2003
COLLIER COUNTY, FLORIDA
By:
Chairman of the Board of
County Commissioners
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,-,,,,,
EXHIBIT A
NOTICE OF FAILURE TO FILE ANNUAL REPORT
Name of Issuer:
Collier County, Florida
Name of Bond Issue:
Capital Improvement and Refunding Revenue Bonds, Series 2003
Date of Issuance:
, 2003
NOTICE IS HEREBY GIVEN that the Issuer hils not provided an Annual Report with respect to the
above-named Bonds as required by Sections 3 and 4(b) of the Continuing Disclosure Certificate dated as
of ,2003. The Issuer anticipates that the Annual [{eport will be filed by
Dated:
COLLIER COUNTY, FLORIDA
By:
Name:
Title:
Exhibit A-l
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EXHIBIT B
Nationally Recognized Municipal Securities Information Repositories approved by the Securities and
Exchange Commission:
Bloomberg Municipal Repository
100 Business Park Drive
Skillman, NJ 08558
Phone: (609) 279-3225
Fax: (609) 279-5962
Email: Munis@Bloomberg.com
Standard & Poor's J.J. Kenny Repository
55 Water Street
45'h Floor
New York, NY 10041
Phone: (212) 438-4595
Fax: (2] 2) 438-3975
Email: nrmsir_repository@sandp.com
FT Interactive Data
Attn: NRMSIR
100 William Street
New York, NY 10038
Phone: (212) 771-6999
Fax: (212) 771-7390 (Secondary Market
Information)
Fax: 212/771-7391 (Primary Market Information)
Email: NRMSm(i..FTID.com
Website: http://www.interactivedata.com
DPe Oat a Inc.
One Executive Drive
Fort Lee, NJ 07024
Phone: (201) 346-0701
Fax: (201) 947-0107
Email: nrmsir(...dpcdata.com
A list of names and addresses of all designated Nationally Recognized Municipal Securities Information
Repositories as of any date may be obtained by visiting the SEes website at
www.sec.govlinfo/m1lnicipal/nrmsir.lzlm.
j: \ bonds \ 439903 \ cdc3.doc
Exhibit B-1
EXHIBIT G
FORM OF GUARANTY AGREEMENT
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EXHIBIT I
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GUARANTY AGREEMENT
GUARANTY AGREEMENT dated as of , 200_ by and between
, a public body corporate organized and existing under the laws of the State of . (the
"Obligor"); and AMBAC ASSURANCE CORPORATION ("Ambac"), a Wisconsin domiciled stock
insurance company.
WITNESSETH:
WHEREAS, the Obligor has or will issue_(the "Obligations"); and
WHEREAS, Ambac will issue its Surety Bond (the "Surety Bond"), substantially in the form set
forth in Annex A to this Agreement, guaranteeing certain payments by the Obligor subject to the terms
and limitations of the Surety Bond; and
WHEREAS, to induce Ambac to issue the Surety Bond, the Obligor has agreed to pay the
premium for such Surety Bond and to reimburse Ambac for all payments made by Ambac under the
Surety Bond from Legally Available Funds, all as more fully set forth in this Agreement; and
WHEREAS, the Obligor understands that Ambac expressly requires the delivery of this
Agreement as part of the consideration for the execution by Ambac of the Surety Bond; and
N.oW, THEREFORE, in consideration of the premises and of the agreements herein contained
and of the execution of the Surety Bond, the Obligor and Ambac agree as follows:
ARTICLE I
DEFINITIONS; SURETY BOND
Section 1.01. Definitions. Except as otherwise expressly provided herein or unless the context otherwise
requires, the terms which are capitalized herein shall have the meanings specified in Annex B hereto.
Section 1.02. Surety Bond.
(a) Ambac will issue the Surety Bond in accordance with and subject to the terms and conditions of the
Conunitment.
(b) The maximum liability of Ambac under the Surety Bond and the coverage and term thereof shall be
subject to and limited by the Surety Bond Coverage and the tenns and conditions of the Surety Bond.
(c) Payments made under the Surety Bond will reduce the Surety Bond Coverage to the extent of that
payment, provided that the Surety Bond Coverage shall be automatically reinstated to the extent of the
reimbursement of principal by the Obligor of any payment made by Ambac. Ambac shall notify the
Paying Agent in writing no later than the fifth (5th) day following the reimbursement by the Obligor that
the Surety Bond has been reinstated to the extent of such reimbursement.
Section 1.03. Premium. In consideration of Ambac agreeing to issue the Surety Bond hereunder, the
Obligor hereby agrees to payor cause to be paid from Legally Available Funds the premium set forth in
the Commitment.
Section 1.04. Certain Other Expenses. The Obligor will pay all reasonable fees and disbursements of
Ambac's counsel related to any modification of this Agreement or the Surety Bond.
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ARTICLE II
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REIMBURSEMENT OBLIGA nONS OF OBLIGOR AND SECURITY THEREFORE
Section 2.01. Reimbursement for Payments Under the Surety Bond and Expenses.
(a) The Obligor will reimburse Ambac, from Legally A vailable Funds within the Reimbursement Period,
without demand or notice by Ambac to the Obligor or any other person, to the extent of each Surety Bond
Payment with interest on each Surety Bond Payment from and including the date made to the date of the
reimbursement by the Obligor at the Effective Interest Rate, The Obligor agrees that it shall make
monthly level principal repayments for each Surety Bond Payment during the Reimbursement Period.
Interest on each Surety Bond Payment shall be paid monthly during the Reimbursement Period. To the
extent that interest payments due hereunder are not paid on a monthly basis, or are not paid as each
principal repayment is made, interest shall accrue on such unpaid amounts at a rate equal to the Effective
Interest Rate,
(b) The Obligor also agrees to reimburse Ambac, from Legally Available Funds, immediately and
unconditionally upon demand for all reasonable expenses incurred by Ambac in connection with the
Surety Bond and the enforcement by Ambac of the Obligor's obligations under this Agreement together
with interest on all such expenses from and including the date which is 30 days from the date a statement
for such expenses is received by the Obligor incurred to the date of payment at the rate set forth in
subsection (a) of this Section 2.01.
Section 2.02. Allocation of Payments. Ambac and the Obligor hereby agree that eaeh repayment of
principal received by Ambac from or on behalf of the Obligor as a reimbursement to Ambac as required
by Section 2.01(a) hereof shall be applied to reinstate all or a portion of the Surety Bond Coverage to the
extent of such repayment. Any interest payable pursuant to Section 2.01(a) hereof shall not be applied to
the reinstatement of any portion of the Surety Bond Coverage. .
Section 2.03. Security for Payments; Instruments of Further Assurance. To the extent, but only to the
extent, tbat tbe Resolution pledges to the Owners or any paying agent therefor. or grants a security
interest or lien in or on any collateral property, revenue or other payments ("Collateral and Revenues") in
order to secure the Obligations or provide a source of payment for the Obligations. the Obligor hereby
grants to Ambaca security interest in or lien on, as the case may be, and pledges to Ambac all such
Collateral and Revenues as security for payment of all amounts due hereunder, which security interest,
lien and/or pledge created or granted under this Section 2.03 shall be subordinate only to the interests of
the Owners and any paying agent therefor in such Collateral and Revenues. The Obligor agrees that it
will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and
delivered, any and all financing statements, if applicable, and all othe'r further instruments as may be
required by law or as shall reasonably be requested by Ambac for the perfection of the security interest, if
any, granted under this Section 2.03 and for the preservation and protection of all rights of Ambac under
this Section 2.03.
Section 2.04. Unconditional. Obligation. The obligations of the Obligor hereunder are absolute and
unconditional and will be paid or performed strictly in accordance with this Agreement, irrespective of:
(a) any lack of validity or enforceability of, or any amendment or other modification of, or waiver with
respect to the Resolution or the Obligations;
(b) any exchange, release or nonperfection of any security interest in property securing the Obligations or
this Agreement or any obligations hereunder;
(c) any circumstances which might otherwise constitute a defense available to, or discharge of, the
Obligor with respect to the Obligations;
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(d) whether or not such obligations are contingent or matured, disputed or undisputed, liquidated or
unliquidated.
ARTICLE III
EVENTS OF DEFAULT; REMEDIES
Section 3.0 I. Events of Default. The following events shall constitute Events of Default hereunder:
(a) The Obligor shall fail to pay to Ambac any amount payable under Sections 1.04 and 2.01 hereof and
such failure shall have continued for a period in excess of the Reimbursement Period;
(b) Any material representation or warranty made by the Obligor hereunder or under the Resolution or
any statement in the application for the Surety Bond or any report, certificate, financial statement or other
instrument provided in connection with the Commitment, tbe Surety Bond or herewith shall have been
materially false at the time when made;
(c) Except as otherwise provided in this Section 3.01, the Obligor shall fail to perform any of its other
obligations under this Agreement, provided that such failure continues for more than thirty (30) days after
receipt by the Obligor of notice of such failure to perform;
(d) The Obligor shall (i) voluntarily commence any proceeding or file any petition seeking relief under
the United States Bankruptcy Code or any other Federal, state or foreign bankruptcy, insolvency or
similar law, (ii) consent to the institution of, or fail to controvert in a timely and appropriate manner, any
such proceeding or the filing of any such petition, (iii) apply for or consent to the appointment of a
receiver, paying agent, custodian, sequestrator or similar official for the Obligor or for a substantial part
of its property, (iv) file an answer admitting the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit of creditors, (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become due or (vii) take action for the
purpose of effecting any of the foregoing; or
(e) An involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of
competent jurisdiction seeking (i) relief in respect of the Obligor, or of a substantial part of its property,
under the United States Bankruptcy Code or any other Federal, state or foreign bankruptcy, insolvency or
similar law or (ii) the appointment of a receiver, paying agent, custodian, sequestrator or similar official
for the Obligor or for a substantial part of its property; and such proceeding or petition shall continue
undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall
continue unstayed and in effect for thirty (30) days.
Section 3.02. Remedies. If an Event of Default shall occur and be continuing, then Ambac may take
whatever action at law or in equity may appear necessary or desirable to collect the amounts then due and
thereafter to become due under this Agreement or any related instrument and enforce any obligation,
agreement or covenant of the Obligor under this Agreement; provided, however, that Ambac may not take
any action to direct or require acceleration or other early redemption of the Obligations or adversely affect
the rights of the Owners. All rights and remedies of Ambac under this Section 3.02 are cumulative and the
exercise of anyone remedy does not preclude the exercise of one or more of the other available remedies.
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ARTICLE IV
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SETTLEMENT
Ambac shall have the exclusive right to decide and determine whether any claim, liability, suitor
judgment made or brought against Ambac, the Obligor or any other party on the Surety Bond shall or
shall not be paid, compromised, resisted, defended, tried or appealed, and Ambac's decision thereon, if
made in good faith, shall be final and binding upon the Obligor. An itemized statement of payments made
by Ambac, certified by an officer of Ambac, or the voucher or vouchers for such payments, shall be prima
facie evidence of the liability of the Obligor, and if the Obligor fails to reimburse Ambac,. pursuant to
subsection (b) of Section 2.01 hereof, upon the receipt of sl1ch statement of payments, interest shall be
computed on such amount from the date of any payment made by Ambac at the rate set forth in
subsection (a) of Section 2.0J hereof.
ARTICLE V
MISCELLANEOUS
Section 5.01. Comoutations. All computations of premium, interest and fees hereunder shall be made on
the basis of the actual number of days elapsed over a year of 360 days.
Section 5.02. Exercise of Rights. No failure or delay on the part of Ambac to exercise any right, power
or privilege under this Agreement and no course of dealing between Ambac and the Obligor or any other
party shall operate as a waiver of any such right, power or privilege, nor shall any single or partial
exercise .of any such right, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies which Arnbac would otherwise have pursuant to
law or equity. No notice to or demand on any party in any case shall entitle such party to any other or
further notice or demand in similar or other circumstances, or constitute a waiver of the right of the other
party to any other or further action in any circumstances without notice or demand.
Section 5.03. Amendment and Waiver. Any provision of this Agreement may be amended, waived,
supplemented, discharged or terminated only with the prior written consent of the Obligor and Ambac.
The Obligor hereby agrees that upon the written request of the Paying Agent, Ambac may make or'
consent to issue any' substitute for the Surety Bond to cure any ambiguity or fonnal defect or omission in
the Surety Bond which does not materially change the tenns of the Surety Bond nor adversely affect the
rights of the Owners, and this Agreement shall apply to such substituted Surety Bond. Ambac agrees to
deliver to the Obligor and to the company or companies, if any, rating the Obligations, a copy of such
substituted Surety Bond.
Section 5.04. Successors and Assilms; Descriptive Headings.
(a) This Agreement shall bind, and the benefits thereof shall inure to, the Obligor and Ambac and their
respective successors and assigns; provided, that the Obligor may not transfer or assign any or all of its
rights and obligations hereunder without the prior written consent of Ambac.
(b) The descriptive headings of the various provisions of this Agreement are inserted for convenience of
reference only and shall not be deemed to affect the meaning or construction of any of the provisions
hereof.
Section 5.05. Other Sureties. If Ambac shall procure any other surety to reinsure the Surety Bond, this
Agreement shall inure to the benefit of such other surety, its successors and assigns, so as to give to it a
direct right of action against the Obligor to enforce this Agreement, and "Ambac," wherever used herein,
shall be deemed to include such reinsuring surety, as its respective interests may appear.
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Section 5.06. Signature on Obligation. The Obligor's liability shall not be affected by its failure to sign
the Surety Bond nor by any claim that other indemnity or security was to have been obtained nor by the
release of any indemnity, nor the return or exchange of any collateral that may have been obtained.
Section 5.07. Waiver. The Obligor waives any defense that this Agreement was executed subsequent to
the date of the Surety Bond, admitting and covenanting that such Surety Bond was executed pursuant to
the Obligor's request and in reliance on the Obligor's promise to execute this Agreement.
Section 5.08. Notices. Requests. Demands. Except as otherwise expressly provided herein, all written
notices, requests, demands or other communications to or upon the respective parties hereto shall be
deemed to have been given or made when actually received, or in the case of telex or telecopier notice
sent over a telex or a telecopier machine owned or operated by a party hereto, when sent, addressed as
specified below or at such other address as either of the parties hereto or the Paying Agent may hereafter
specify in writing to the others:
If to the Obligor: >
If to the Paying Agent: >
If to Ambac:
Ambac Assurance Corporation
One State Street Plaza
17th Floor
New York, New York 10004
Attention: General Counsel
Section 5.09. Survival of Representations and Warranties. All representations, warranties and
obligations contained herein s~all survive the execution and delivery of this Agreement and the Surety
Bond.
Section 5.10. Governing. Law. This Agreement and the rights and obligations of the parties under this
Agreement shall be governed by and construed and interpreted in accordance with the laws of the State.
Section 5.11. Counte1l'arts. This Agreement may be executed in any number of copies and by the
different parties hereto on the same or separate counterparts, each of which shall be deemed to be an
original instrument. Complete counterparts of this Agreement shall be lodged with the Obligor and
Ambac.
Section 5.12. Severability. In the event any prOVlSlon of this Agreement shall be held invalid or
unenforceable by any court of competent jurisdiction, slIch holding shall not invalidate or render
unenforceable any other provision hereof.
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be
duly executed and delivered as of the date rrrst above written.
[OBLIGOR]
(Seal)
Attest:
Title:
By
Title:
AMBAC ASSURANCE CORPORATION
Attest:
Title:
By
Title:
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ANNEX A. SURETY BOND
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ANNEX B
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DEFINITIONS
For all purposes of this Agreement, except as otherwise expressly provided herein or unless the context
otherwise requires, all capitalized terms shaH have the meaning as set out below.
"Agreement" means this Guaranty Agreement.
"Ambac" has the same meaning as set forth in the first paragraph of Uris Agreement.
"Collateral and Revenues" has the same meaning as set forth in Section 2,03 hereof.
"Conunitment" means the Ambac Conunitment for Surety Bond in the form attached hereto as Annex C.
"Debt Service Payments" means those payments required to be made by the Obligor which will be
applied to payment of principal of and interest on the Obligations.
"Effective Interest Rate" means the lesser of the Reimbursement Rate or the maximum rate of interest
permitted by then applicable law; provided, however, that the Effective Interest Rate shall in no event be
less than the interest rate on the Obligations.
"Event of Default" shall mean those events of default set forth in Section 3.01 of this Agreement.
"Legally Available Funds" means any moneys legally available to the ObligoTfor the payment of its
obligations.
"Obligations" has the same meaning as set forth in the second paragraph of this Agreement.
"Obligor" has the same meaning as set forth in the first paragraph of this Agreement.
"Owners" means the registered owner of any Obligation as indicated in the books maintained by the
applicable paying agent, the Obligor or any designee of the Obligor for such purpose. The term "Owner"
shall not include the Obligor or any person or entity whose obligation or obligations by agreement
constitute the underlying security or source of payment for the Obligations.
"Paying Agent" means
"Reimbursement Period" means, with respect to a particular Surety Bond Payment, t,he period
commencing on the date of such Surety Bond Payment and ending 12 months following such Surety
Bond Payment.
"Reimbursement Rate" means Citibank's prime rate plus two (2) percent per annum, as of the date of
such Surety Bond Payment, said "prime rate" being the rate of interest announced from time to time by
Citibank, New York, New York, as its prime rate. The rate of interest shall be calculated on the basis of a
360 day year.
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"Resolution" means
"State" means the State of -----'
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"Surety Bond" means the Surety Bond issued by Ambac substantially in the form attached to this
Agreement as Annex A.
"Surety Bond Coverage" means the amount available at any particular time to be paid to the Paying
Agent under the tenns of the Surety Bond, which amount shan never exceed $
"Surety Bond Payment" means an amount equal to the Debt Service Payment less (i) that portion of the
Debt Service Payment paid by the Obligor, and (ii) other funds legally available to the Paying Agent for
payment to the Owners. all as certified by the Paying Agent in a demand for payment rendered pursuant
to the terms of the Surety Bond.
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ANNEX C
COMMITMENT
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