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Resolution CWS 1998-4 RESOLUTION NO. CWS.98- 4 A RESOLUTION SUPPLEMEl\TIl\G A RESOLUTI01\: WTITLED "A RESOLUTION AMENDI!':G J:'\ CERTAIN RESPECTS AND RESTATING IN ITS ENTIRETY RESOLUTION NO. CWS-85-5 OF THE COLLIER COUNTY WATER-SEWER DISTRICT, ADOPTED ON JULY 30, 1985, AND ENTITLED: 'A RESOLUTIOl\ AUTHORIZING THE ISSUANCE BY THE COLLIER COUNTY WATER-SEWER DISTRICT OF NOT EXCEEDING $82,500,000 IN THE AGGREGATE PRINCIPAL AMOUNT OF WATER AND SEWER REVENUE BONDS, SERIES 1985 TO FINANCE THE COST OF REFUNDING CERTAIN OUTSTANDING OBLIG..\ TIONS OF THE DISTRICT AND CONSTRCCTI0.'G AND ACQlJlRING CERTAIN ADDITIONS. EXTENSIONS AND IMPROVEMEl\TS TO THE DISTRICTS \VA TER Al\D SEWER SYSTE:\l: PLEDGING THE NET REVE0.'UES AND SYSTEM DEVELOPMENT FEES TO SECURE PA n...1E0.'T OF THE PRINCIPAL OF AND INTEREST 0:-; SAID BONDS: PROVIDI'\G FOR THE RIGHTS OF THE HOLDERS OF SAID BO\'DS: AND PROVIDING FOR A!\ EFFECTIVE DA TE FOR THIS RESOLUTIO:\' AND PROVIDI:\G AN EFFECTIVE DATE:" AUTHORIZ/:\G THE REFV\DING OF ALL OF THE DISTRICTS OCTSTANDfNG WATER AND SEWER REVENUE BONDS, SERIES 1991 A.'-'D A PORTION OF THE DISTRICTS OUTSTA0.'DfNG WATER AND SEWER REVEl\U'E BO:\DS, SERIES 1992; AUTHORIZI:\G THE ISSt..:ANCE OF 1\:OT EXCEEDI:\G $7.500.000 AGGREGATE PRINCIPAL A:\10L'NT OF COLLIER COt'NTY WATER-SEWER DISTRICT \VATER AND SEV':ER REFLiNDING REVENUE BOl\DS. SERIES 1998 Ii\ ORDER TO REFUND SUCH SERIES 1992 BONDS AND THE ISSUANCE OF NOT EXCEEDING 525,000,000 AGGREGA TE PRINCIPAL AMOUNT OF COLLIER COUNTY WATER-SEWER DISTRICT WATER AND SEWER REFUNDING REVENUE BONDS, SERIES 1999 IN ORDER TO REFUND SUCH SERlES 1991 BONDS; MAKING CERTAIN COVENANTS AND AGREEMENTS IN CO\iNECTION WITH THE ISSUAl\CE OF SUCH BONDS; AUTHORIZING A NEGOTIATED SALE OF SAID BONDS; .. . A F 1 .ti R F 1 ~~ DELEGATING CERTAIN AUTHORITY TO THE CHAIRMAI\ AND VICE-CHAIR.J\1AI\ FOR THE AUTHORIZATION, EXECUTION AND DELIVERY OF PURCHASE CONTRACTS WITH RESPECT THERETO, AND THE APPROVAL OF THE TERIvlS 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 OFFICIAL STATEMENTS WITH RESPECT THERETO; AUTHORIZING THE EXECUTION AND DELIVERY OF ESCRO\V DEPOSIT AGREEMENTS AND THE APPOJ1\'TMENT OF AN ESCROW AGENT; APPROVING THE EXECUTION AND DELIVERY OF CONTINUING DISCLOSURE CERTIFICATES; AUTHORIZING \It.,'NICIPAL BO~D INSURANCE FOR THE BO:--:DS; AND PROVIDI'..'G A\: EFFECTIVE DATE BE IT RESOLVED BY THE BOARD OF COUI'TY CO:\UIISSIO!'iERS OF COLLIER COUI'TY, FLORIDA, ACTING AS THE EX-OFFICIO GOVERI'ING BOARD OF THE COLLIER COU~TY \VA TER-SEWER DISTRICT: SECTlO:\ I. FI:\DI:'\GS. It is hereby found and determined that (A) On July 30, 1985. the Collier County Water-Sewer District (the "Issuer") duly adopted Resolution 1\0. C\\'S-85-5, as amended and restated by Resolution No. C\\'S-85-13 duly adopted on December 26, 1985, as amended and supplemented (collectively, the "Resolution"), the title of which Resolution 1\0. CWS-85-13 is quoted in the title of this Supplemental Resolution, for the purposes described therein, authorizing, among other things, the issuance of the Issuer's Collier County Water-Sewer District Water and Sewer Revenue Bonds. Series 1985 (the "Series 1985 Bonds"). which Series 1985 Bonds subsequently have been refunded and are no longer outstanding under the Resolution. (B) The Issuer currently has outstanding pursuant to the Resolution its Collier County Water-Sewer District Water and Sewer Revenue Bonds, Series 1991 (the "Refunded Series 1991 Bonds"), its Collier County Water-Sewer District Water and Sewer Revenue Bonds, Series 1992 (the "Series 1992 Bonds"), its Collier County Water-Sewer District Taxable Water and Sewer Refunding Revenue Bonds. Series J994A (the "Series 1994A 2 R Flat Bonds") and its Collier County Water-Sewer District Water and Sewer Refunding Revenue Bonds, Series 1994B (the "Series 1994B Bonds"). (e) The Refunded Series 1991 Bonds maturing on and after July 1,2000 arc subject to redemption at the option of the Issuer on July I, 1999, the earliest permitted optional redemption date for such Bonds (the "Series 1991 Bonds Redemption Date"), at a redemption price of 102% of the principal amount redeemed plus interest accrued to the Series 1991 Bonds Redemption Date. (D) The Series 1992 Bonds maturing on and after July 1,2003 (the "Refunded Series 1992 Bonds") are subject to redemption at the option of the Issuer on July 1,2002, the earliest permitted optional redemption date for such Bonds (the "Series 1992 Bonds Redemption Date"), at a redemption price of 102% of the principal amount redeemed plus interest accrued to such Series 1992 Bonds Redemption Date. (E) Under the Internal Revenue Code of 1986, as amended, the Refunded Series 1991 Bonds may not be refunded using the proceeds of bonds the interest on which is excludable from gross income for federal income tax purposes if such refunding bonds are issued more than 90 days prior to the Series 1991 Bonds Redemption Date. (F) If the Issuer were permitted to refund the Refunded Series 1991 Bonds at current market mterest rates. it could achieve substantial debt service savings with respect to such Bonds. (G) The Underwriters (as hereinafter defined) have indicated that they are willing to enter into the hereinafter defined Series 1999 Bonds Purchase Contract with the Issuer in advance of the Series] 991 Bonds Redemption Date pursuant to which Series 1999 Bonds Purchase Contract the UndemTiters will agree to purchase the Series ] 999 Bonds (hereinafter defined) at interest rates that are based on current market interest rates and which take into account the delayed delivery of the Series 1999 Bonds despite the fact that the Series 1999 Bonds will not be issued and delivered until not earlier than 90 days prior to the Series 199] Bonds Redemption Date. (H) The commitment of the UndemTiters to purchase the Series 1999 Bonds at rates based upon current market interest rates (taking the delayed delivery into account) will pennit the Issuer to achieve debt service savings that will approximate the savings the Issuer might have achieved had it been permitted to issue tax-exempt refunding bonds on the date of such commitment (taking the delayed delivery into account). (I) In light of the foregoing, in order to achieve debt service savings. the Issuer hereby determines to refund the Refunded Series 1991 Bonds and the Refunded Series 1992 3 R F 1 lit Bonds (collectively, the "Refunded Bonds"). That portion of the Series 1992 Bonds which are not refunded in connection with the issuance of the Series 1998 Bonds (as hereinafter defined), the Series 1994A Bonds and the Series 1994B Bonds shall be referred to as the "Outstanding Parity Bonds." (1) The Resolution provides for the issuance of Additional Bonds, payable on a parity with the Outstanding Parity Bonds, for the refunding of the Refunded Bonds, upon meeting certain requirements set forth in the Resolution. (K) There is hereby authorized the payment and refunding of the Refunded Bonds in order to achieve debt service savings, all in the manner as provided by this Supplemental Resolution. For the payment and refunding of the Refunded Series 1992 Bonds the Issuer shall, as provided herein, deposit part of the proceeds derived from the sale of the Issuer's Collier County Water-Sewer District Water and Sewer Refunding Revenue Bonds. Series 1998 (the "Series 1998 Bonds"), together with other legally available moneys of the Issuer, in a special escrow deposit trust fund, to purchase direct U.S. Treasury obligations (the "Series 1992 Refunding Securities") which shall be sufficient, together with the investment earnings therefrom and a cash deposit, to pay the Refunded Series 1992 Bonds as the same become due and payable or are redeemed prior to maturity, all as provided herein and the hereinafter described Series 1992 Escrow Deposit Agreement. For the payment and refunding of the Refunded Series 1991 Bonds the Issuer shall, as provided herein, deposit part of the proceeds derived from the sale of the Issuer's Collier eounty Water-Sewer District Water and Sewer Refunding Revenue Bonds, Series 1999 (the "Series 1999 Bonds"). together \\ith other legally available moneys of the Issuer. in a special escrow deposit trust fund, to purchase direct U.S. Treasury obligations (the "Series 1991 Refunding Securities") which shall be sufficient together \\ith the investment earnings therefrom and a cash deposit. to pay the Refunded Series 1991 Bonds as the same become due and payable or are redeemed prior to maturity, all as provided herein and the hereinafter described Series 199] Escrow Deposit Agreement Subsequent to the defeasance of the Refunded Bonds, the Refunded Bonds shall no longer be payable from or be secured by any portion of the Pledged Funds. (L) In order to achieve debt service savings, the Issuer deems it to be in its best interest to issue its Series 1998 Bonds in order to effect the refunding of the Refunded Series 1992 Bonds and to issue its Series 1999 Bonds in order to effect the refunding of the Refunded Series 1991 Bonds. (M) Due to the potential volatility of the market for tax-exempt obligations such as the Series 1998 Bonds and the Series 1999 Bonds (collectively, the "Refunding Bonds") and the complexity of the transactions relating to such Refunding Bonds, it is in the best interest of the I ssuer to sell the Refunding Bonds by a negotiated sale, allowing the Issuer 4 R E 1 IGIl to enter the market at the most advantageous time, rather than at a specified advertised date, thereby permitting the Issuer to obtain the best possible price and interest rate for the Refunding Bonds. (:\:) The Issuer anticipates recehing a favorable offer to purchase the Refunding Bonds from Raymond James & Associates, Inc. and Salomon Smith Barney, Inc. (collectively, the "UndemTiters"), all within the parameters set forth herein. (0) Inasmuch as the Issuer desires to sell the Refunding Bonds at the most advantageous time and not wait for a scheduled meeting of the Board of County Commissioners of Collier County, Florida (the "Board") sitting as the ex-officio governing board of the Issuer, so long as the herein described parameters are met, the Issuer hereby determines to delegate the award and sale of the Refunding Bonds to the Chairman of the Board within such parameters, and, in his absence or unavailability, to the Vice-Chairman of the Board. (P) The form, terms and details of the Refunding Bonds shall be determined in accordance with this Supplemental Resolution. (Q) The covenants, pledges and conditions in the Resolution shall be applicable to the Refunding Bonds herein authorized and said Refunding Bonds shall be on a parity with and rank equally as to the lien on and source and security for payment from the Pledged Funds and in all other respects with the Outstanding Parity Bonds, and shall constitute "Bonds" within the meaning of the Resolution. SECTIO~ 2. DEFJ~ITIO~S. When used in this Supplemental Resolution. the terms defined in the Resolution shall have the meanings therein stated, except as such definitions shall be hereinafter amended and defined. SECTI01'\ 3. AUTHORITY FOR THIS SUPPLEMEJliTAL RESOLVTI01'\. This Supplemental Resolution is adopted pursuant to the provisions of the Act. SECTlO1'\ 4. AUTHORIZATIOlIi OF REFUNDING OF THE REFUNDED BONDS. The Issuer hereby authorizes the refunding of the Refunded Bonds pursuant to the terms of the Resolution and the hereinafter described Escrow Deposit Agreements. SECTION 5. DESCRIPTION OF THE REFUNDING BONDS. The Issuer hereby authorizes the issuance of a series of Bonds in the aggregate principal amount not to 5 R F 1 iQ'~ exceed S7,500,000 to be known as the "Collier County Water-Sewer District Water and Sewer Refunding Revenue Bonds, Series 1998 " (or such other designation as the Chairman may determine), for the principal purpose of refunding the Refunded Series 1992 Bonds. In the event such Senes 1998 Bonds are not issued until calendar year] 999, such Series 1998 Bonds shall be designated as "Collier County Water-Sewer District Water and Sewer Refunding Revenue Bonds, Series 1999A" (or such other designation as the Chairman may determine). The aggregate principal amount of Series 1998 Bonds to be issued pursuant 10 the Resolution shall be determined by the Chairman provided such aggregate principal amount does not exceed S25,000,000. The Series 1998 Bonds shall be dated as of December I, 1998 (or such other date as shall be determined by the Chairman), shall be issued in the form of fully registered Bonds in the denomination of 55.000 or any integral multiple thereof, shall be numbered consecutively from one upward in order of maturity preceded by the letter "R", shall bear interest from their dated date, payable semi-annually, on July I and JanU31)' I and of each year (the "Interest Dates"), commencing on July 1, 1999 (or such other date as shall be determined by the Chairman). The Issuer hereby authorizes the issuance of a series of Bonds in the aggregate principal amount not to exceed 525,000,000 to be knO\\l1 as the "Collier County Water- Sewer District Water and Sewer Refunding Revenue Bonds. Series 1999," for the principal purpose of refunding the Refunded Series 199] Bonds. In the event the Series 1998 Bonds are not issued until calendar year 1999. the Series 1999 Bonds shall be designated as "eollier County Water-Sewer District Water and Sewer Refunding Revenue Bonds, Series 1999B" (or such other designation as the Chairman may determine). The aggregate principal amount of Series 1999 Bonds to be issued pursuant to the Resolution shall be determined by the Chairman provided such aggregate principal amount does not exceed S25,000,000. The Series 1999 Bonds shall be dated as of April I. 1999 (or such other date as shall be determined by the Chairman). shall be issued in the form of fully registered Bonds in the denomination of 55,000 or any Integral multiple thereof. shall be numbered consecutively from one upward in order of maturity preceded by the lener "R". shall bear interest from their dated dale. payable semi-annually, on July I and January 1 and of each year (the "Interest Dates"). commencing on July 1. 1999 (or such other dale as shall be determined by the Chairman). Interest on the Refunding Bonds shall be payable by check or draft of First Union National Bank, Jacksom;lIe, Florida, as RegislTar and Paying Agent, made payable to 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 Interest Date, or, at the request and expense of such Holder, by bank wire transfer to the account of such Holder. The principal of or Redemption Price, if applicable, on the Refunding Bonds is payable upon presentation and surrender of the Refunding Bonds at the designated corporate trust office of the Paying Agent. All payments 6 t R F.l -Ill of principal or Redemption Price, if applicable, and interest on the Refunding Bonds shall be payable in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts. The Refunding Bonds shall bear interest at such rates and yields, shall mature on July I of each of the years and in the principal amounts corresponding to such years, and shall have su~h redemption provisions as determined by the Chairman subject to the conditions set forth in Section 6 hereof. All of the terms of the Series 1998 Bonds will be included in a Bond Purchase Contract which shall be in substantially the form attached hereto and made a part hereof as Exhibit A (the "Series 1998 Purchase Contract"). All of the terms of the Series 1999 Bonds will be included in a Forward Delivery Bond Purchase Contract which shall be in substantially the form attached hereto and made a part hereof as Exhibit B (the "Series 1999 Purchase Contract" and collectively with the Series 1998 Purchase Contract the "Purchase eontracts"). The Chairman is hereby authorized to execute either or both of the Purchase Contracts in substantially the forms attached hereto as Exhibit A and Exhibit B with such modifications as she deems appropriate upon satisfaction of the respective conditions described in Sections 6 and 7 hereof. SECTIO:\' 6. COJ'liDITIOJ'liS TO EXECUTIO~ OF SERIES 1998 PURCHASE CO~TR-\CT. The Series 1998 Purchase eontract shall not be executed by the Chairman until such time as all of the following conditions have been satisfied: (A) Receipt by the Chairman of a \\Titten offer to purchase the Series 1998 Bonds by the Cnderwriters substantially in the form of the Series 1998 Purchase eontract attached hereto as Exhibit A. said offer to provide for, among other things, (i) not exceeding $7.500,000 aggregate principal amount of Series 1998 Bonds, (ii) an undemTiting discount (including management fee and expenses) not in excess of 0.75% of the par amount of the Series 1998 Bonds. (iii) a true interest cost of not more than 4.75% per annum, as determined by the Issuer.s financial Advisor and (iv) the maturities of the Series 1998 Bonds, with the final maturity being not later than July 1, 20 I O. (B) With respect to optional redemption terms for the Series 1998 Bonds, if any, the first optional redemption date may be no later than July 1, 2009 and no call premium may exceed 2% of the par amount of that portion of the Series 1998 Bonds to be redeemed. Term Bonds may be established with such Sinking Fund Installments as the Chairman deems appropriate. (C) Receipt by the Chairman of a disclosure statement and a truth-in-bonding statement of the UndemTiter dated the date of the Series 1998 Purchase Contract and complying with Section 218.385, Florida Statutes. 7 RFl II Upon satisfaction of all the requirements set forth in this Section 6, the Chairman is authorized to execute and deliver the Series 1998 Purchase Contract containing terms complying with the provisions of this Section 6 and the Series 1998 Bonds shall be sold to the UndemTiters pursuant to the provisions of such Series 1998 Purchase Contract. SECTIOl" 7. CONDITIONS TO EXECUTIOl" OF SERIES 1999 PURCHASE CO!'o'TRACT. The Series 1999 Purchase Contract shall not be executed by the Chairman until such time as all of the following conditions have been satisfied: (A) Receipt by the Chairman of a written offer to purchase the Series 1999 Bonds by the UndemTiters substantially in the form of the Series 1999 Purchase Contract attached hereto as Exhibit B, said offer to provide for, among other things, (i) not exceeding S25,000,000 aggregate principal amount of Series 1999 Bonds. (ii) an undemTiting discount (including management fee and expenses) not in excess of 0.60% of the par amount of the Series 1999 Bonds, (iji) a true interest cost of not more than 5.25% per annum, as determined by the Issuer's FinanCial Advisor, (iv) present value savings of at least 7.0% of the par amount of the Refunded Series 199] Bonds, as determined by the Issuer's Financial Advisor. (v) the maturities of the Series 1999 Bonds, with the final maturity being not later than July 1, 2016, and (vi) a delivery date for the Series 1999 Bonds which is no earlier than April 2, 1999 and no later than the Series 1991 Bonds Redemption Date. (B) With respect to optional redemption terms for the Series 1999 Bonds. if any. the first optional redemption date may be no later than July 1. 2009 and no call premium may exceed 2% of the par amount of that portion of the Series 1999 Bonds to be redeemed. Term Bonds may be established with such Sinking Fund Installments as the Chairman deems appropriate (e) Receipt by the Chairman of a disclosure statement and a truth-in-bonding statement of the UndemTiter dated the date of the Series J 999 Purchase Contract and complying with Section 218.385, Florida Statutes. Upon satisfaction of all the requirements set forth in this Section 7, the Chairman is authorized to execute and deliver the Series 1999 Purchase Contract containing terms complying with the provisions of this Section 7 and the Series 1999 Bonds shall be sold to the UndemTiters pursuant to the provisions of such Series 1999 Purchase Contract. SECTION 8. REDEMPTION PROVISIONS. The Refunding Bonds may be redeemed prior to their respective maturities as may be determined by the Chairman, in her discretion, pursuant 10 Sections 6 and 7 hereof and described in the Purchase Contracts. 8 ,. 8 F 1 A~ SECTION 9, BOOK-ENTRY. Notwithstanding the provisions set forth in Section 2.08 of the Resolution. the Series 1998 Bonds and the Series 1999 Bonds each shall be initially issued in the form of a separate single certificated fully registered Bond for each of the maturities of each series of Refunding Bonds. Upon initial issuance, the ownership of each such Refunding 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 ("DTC"). Except as provided in this Section 9, all of the Outstanding Series 1998 Bonds and Series 1998 Bonds shall be registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee ofDTC. As long as either series of the Refunding Bonds shall be registered in the name of Cede & Co., all payments of interest on such series of Bonds shall be made by the Paying Agent by check or draft or by wire transfer to eede & eo., as Holder of those Bonds. With respect to Refunding Bonds registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee of DTC. the Issuer, the Registrar and the Paying Agent shall have no responsibility or obligation to any participant in the DTe book- entry program or to any Indirect partIcipant (a "Parriclpant"). Without limiting the immediately preceding sentence, the Issuer, the Registrar and the Paying Agent shall have no responsibility or obligation \\ith respect to (A) the accuracy of the records of DTe, Cede & eo. or any Participant \\ith respect to any o\\nership interest on the Refunding Bonds, (B) the delivery to any Participant or any other Person other than a Refunding Bondholder, as shown in the registration books kept by the Registrar. of any notice with respect to the Refunding Bonds, including any notice of redemption, or (C) the payment to any Participant or any other Person, other than a Refunding Bondholder. as shown in the registration books kept by the Registrar, of any amount with respect to principal of, redemption premium, if any. or interest on the Refunding Bonds. The Issuer, the Registrar and the Paying Agent may treat and consider the Person in whose name each Bond is registered in the registration books kept by the RegIstrar as the Holder and absolute owner of such Refunding Bond for the purpose of payment of principal. redemption premium, if any, and interest with respect to such Refunding Bond, for the purpose of gi\ing notices of redemption and other matters with respect to such Refunding Bond, for the purpose of registering transfers with respect to such Refunding Bond, and for all other purposes whatsoever. The Paying Agent shall pay all prinCipal of, redemption premium, if any, and interest on the Refunding 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 authonzed in writing, as provided herein and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to payment of principal, redemption premium, if any, and interest on the Refunding 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 Refunding Bond evidencing the obligation of the Issuer to make payments of principal, redemption premium. if any, and interest pursuant to the provisions hereof. Upon delivery 9 - " 8 F 1 QC by DTC to the Issuer of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & eo., and subject to the provisions herein with respect to transfers during the 15 days next preceding an Interest Date or mailing of notice of redemption, the words "Cede & Co." in the 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 1998 Bonds or Series 1999 Bonds be registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee of DTC, is not in the best interest of the beneficial owners of such series of Refunding Bonds or (ii) to the effect that DTC 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, in its sole discretion. that such book-entry only system is burdensome to the Issuer, the Series 1998 Bonds or Series 1999 Bonds. as the case may be, shall no longer be restricted to being registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or names Holders shall designate, in accordance with the provi sions hereof. In such event, the Issuer shall issue and the Registrar shall authenticate. transfer and exchange the Series 1998 Bonds or Series 1999 Bonds, as the case may be. of like principal amount and maturity, in denominations of S5,000 or any integral multiple thereof to 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 Letter of Representations previously executed by the Issuer and delivered to DTC in order 10 induce DTC to act as securities depository for the Refunding Bonds shall apply to the payment of principal of and interest on the Refunding Bonds. SECTIO~ 10. APPLICA TIO~ OF REFU~Dl~G BO:"'D PROCEEDS. The proceeds derived from the sale of the Refunding Bonds shall be applied by the Issuer simultaneously with the delivery thereof as follows: (A) An amoWlt equal to the accrued interest on the Refunding Bonds, if any, shall be deposited to the Interest Account and shall be used only for the purpose of paying the interest which shall become due on the Refunding Bonds. (B) A sufficient amount of Series 1998 Bond proceeds, together with other legally available moneys, shall be deposited irrevocably in trust in an escrow deposit trust fund established under the terms and provisions of the hereinafter defined Series 1992 Escrow Deposit Agreement and, other than a cash deposit. shall be invested in Series 1992 Refunding Securities in the manner set forth in th,. Series 1992 Escrow Deposit Agreement. 10 : RFl It, which investments shall mature at such times and in such amounts as shall be sufficient. together with such cash deposit, to pay the principal of or Redemption Price, if applicable, and interest on the Refunded Series 1992 Bonds as the same mature or are redeemed on the Series 1992 Bonds Redemption Date. (C) A sufficient amount of Series 1999 Bond proceeds, together with other legally available moneys, shall be deposited irrevocably in trust in an escrow deposit trust fund established under the terms and provisions of the hereinafter defined Series 1991 Escrow Deposit Agreement and, other than a cash deposit, shall be invested in Series 1991 Refunding Securities in the manner set forth in the Series 1991 Escrow Deposit Agreement, which investments shall mature at such rimes and in such amounts as shall be sufficient, with such cash deposit, to pay the principal of or Redemption Price, if applicable, and interest on the Refunded Series 1991 Bonds as the same mature or are redeemed on the Series 1991 Bonds Redemption Date. (0) The remaining Refunding Bond proceeds shall be applied to the payment of the premiums of any municipal bond insurance policies applicable to the Refunding Bonds or reserves established therefor and to the papnent of costs and expenses relating to the issuance of the Refunding Bonds. SECTION 11, PRELl:\lINARY OFFICIAL STA TE~tENT, The Issuer hereby authorizes the disoibution and use of the Preliminary Official Statement in substantially the form attached hereto as Exhibit e in connection \\ith offering the Refunding 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 15c2-12 promulgated under the Securities Exchange Act of 1934 (the "Rule") in the form as mailed. Execution of a certificate by the Chairman deeming the PreliminarY' Official Statement "final" as described abo\'e shall be - - conclusive eVidence of the approval of any insertions. changes or modifications. SECTION 12. OFFICIAL STATEMENT. Subject in all respects with the satisfaction of the conditions set forth in Sections 6 and 7 hereof, the Chairman is herebv authorized and directed to execute and deliver a final Official Statement, dated the date ;f the execution of the Purchase Contracts, which shall be in substantially the form of the Preliminary Official Statement, in the name and on behalf of the Issuer, and thereupon to cause such Official Statement to be delivered to the UndemTiters with such changes, amendments, modifications, omissions and additions as may be approved by the Chairman. The Chairman is hereby authorized and directed to execute and deliver a subsequent final Official Statement or supplement or addendum to the Official Statement, if it is determined 11 ~Fl. by the Underwriters and Bond Counsel for the Issuer to be necessary in order to comply with applicable federal securities laws, as a result of the delayed delivery of the Series 1999 Bonds, with such changes, amendments, modifications. omissions and additions as may be approved by the Chairman. Said Official Statements, 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 Refunding Bonds to the public. Execution by the Chairman of the Official Statements shall be deemed to be conclusive evidence of approval of such changes. SECTIO:'\ 13. AUTHORIZATION TO EXECUTE ESCROW DEPOSIT AGREEMENTS Al'iD FORWARD ESCROW SECURITIES PURCHASE AGREEMENT. Subject in all respects to the satisfaction of the conditions set forth in Sections 6 and 7 hereof, the Issuer hereby authorizes and directs the Chairman and Clerk to execute two Escrow Deposit Agreements (the "Series 1991 Escrow Deposit Agreement" and the "Series 1992 Escrow Deposit Agreement" and collectively, the "Escrow Deposit Agreements") and to deliver the Escrow Deposit Agreements to First Union National Bank. Jacksonville. Florida. which is hereby appointed as escrow agent thereunder (the "Escrow Agent"). All of the provisions of the Escrow Deposit Agreements 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 Agreements shall be in substantially the form of the Series 1991 Escrow Deposit Agreement and the Series 1992 Escrow Deposit Agreement attached hereto as Exhibits 0 and E. respectively. wllh such changes. amendments, modifications. omissions and additions. including the date of such Escrow Deposit Agreements. as may be approved by.said Chairman and Clerk. Execution by the ehairman and the elerk of each Escrow Deposit Agreement shall be deemed to be conclusive evidence of approval of such changes. The Financial Advisor, the Underwriters, Bond Counsel and the Escrow Agent are hereby authorized and directed to execute and file all documents necessary to purchase or subscribe to the Refunding Securities on behalf of the Issuer which relate to the Escrow Deposit Agreements. The Chairman and Clerk also are authorized and directed to execute and delIver any fom'ard escrow securities purchase agreement which is required in connection with the purchase of the Series 1991 Refunding Securities. Such agreement shall be in form and substance satisfactory to the Issuer, Bond Counsel and the provider of such Securities. SECTION 14. TRANSFER OF MONEYS TO ESCROW DEPOSIT TRUST FUl'o'DS. Subject in all respects to the satisfaction of the conditions set forth in Sections 6 and 7 hereof, excess moneys in the Sinking Fund not required by the terms of the Resolution to be on deposit therein and which are allocated to the Refunded Series 1991 Bonds and the Refunded Series 1992 Bonds shall be transferred to the respective escrow deposit trust funds 12 ~J:"1.. established pursuant to the Escrow Deposit Agreements in accordance with thc Escrow Deposit Agreements. SECTIO:\ 15. APPOl~ThlENT OF PA YI~G AGE~T AND REGISTRAR. Subject in all respects with the satisfaction of the conditions set forth in Sections 6 and 7 hereof, First Union National Bank, Jacksonville, Florida, is hereby designated Registrar and Paying Agent for the Refunding Bonds. The Chairman and the Clerk are hereby authorized to enter into any agreement which may be necessary to effect the transactions contemplated by this Section 15 and by the Rcsolution. SECTIO~ 16. I~SURANCE. Subject in all respects to the satisfaction of the conditions set forth in Sections 6 and 7 hereof, the Issuer hereby authorizes the payment of the principal of and interest on the Refunding Bonds to be insured pursuant to municipal bond insurance policies (the "Bond Insurance Policies") issued by Financial Guaranty Insurance eompany (the "Insurer" or "financial Guaranty"). The Chairman and the Clerk arc hereby authorized to execute such documents and instruments necessary to cause Financial Guaranty to IOsure the Refunding Bonds. With respect to the Refunding Bonds. Financial Guaranty shall be deemed to be the "Insurer" as such term is used and defined in the Resolution. SECTlO:\ 17. PROVISIO:\S RELA TI:\G TO BO,,"O INSuRANCE POLICIES. The following provisions relating to thc Bond Insurance Policies issued by finanCIal Guaranty shall apply to the Refunding Bonds so long as either Bond Insurance Policy is in full force and effect and any Refunding Bonds shall remain Outstanding: (A) Information Pro'vided to Financial Guarant)'. financial Guaranty shall be pro\ided with the following information: (i) the Annual Budget for each Fiscal Year. the Annual Audit for each fiscal Year. and a statement of the Net Revenues for each fiscal Year. as soon as the same become available; (ii) any Official Statement prepared in connection with the issuance of Additional Bonds or Subordinated Indebtedness within 30 days of the sale thereof; (iii) notice of any draw upon or deficiency due to market fluctuation in the amount, if any, on deposit in the Reserve Account; (iv) notice of the redemption, other than mandatory sinking fund redemption, of any of the Refunding Bonds, including the principal amount, maturities and CUSIP numbers thereof; (v) simultaneously with the delivery of the Annual Audit: (a) the number of System users as of the end of the previous fiscal Year, (b) notification of the withdrawal of any System user comprising 4% or more of the System sales measured in terms of Net Revenues since the last reporting date, and (c) any significant plant retirements or expansions planned or undertaken since the last reporting date; and ('vi) such additional information as the Insurer may reasonably request from time to time 13 , 8 E 1 .4 (B) Payment Procedure Pursuant to Bond Insurance Policies. (i) If, on the third day preceding any interest payment date for the Series 1998 Bonds or the Series 1999 Bonds the Issuer does not have on deposit sufficient moneys available to pay all principal of and interest on the Series 1998 Bonds and the Series 1999 Bonds due on such date, the Issuer shall immediately notify the Paying Agent who shall immediately notify Financial Guaranty and State Street Bank and Trust Company, N.A., New York, New York or its successor as its Fiscal Agent (the "Fiscal Agent") of the amount of such deficiency. If, by said interest payment date, the Issuer has not provided the amount of such deficiency, the Issuer shall simultaneously make available to Financial Guaranty and to the Fiscal Agent the registration books for the series of Bonds to which such deficiency relates maintained by the Registrar. In addition: (a) The Registrar shall provide Financial Guaranty with a list of the Series 1998 Bondholders or Series 1999 Bondholders, as the case may be, entitled to receive principal or interest payments from Financial Guaranty under the terms of the applicable Bond Insurance Policy and shall make arrangements for Financial Guaranty and its Fiscal Agent (1) to mail checks or drafts to the Bondholders entitled to receive full or partial interest payments from Financial Guaranty and (2) to pay principal of the Series 1998 Bonds or Series ] 999 Bonds. as the case may be, surrendered \0 the Fiscal Agent by the Bondholders entitled to receive full or partial principal paymenrs from Financial Guaranty. (b) The Registrar shall, at the rime it makes the registration books available to Fmancial Guaranty pursuant to (a) above, notify Series 1998 Bondholders or Series 1999 Bondholders, as the cae may be, entitled to receive the payment of principal of or interest on the Series 1998 Bonds or Series 1999 Bonds from Financial Guaranty (I) as to the fact of such entitlement, (2) that Financial Guaranty will remit to them all or part of the interest payments coming due subject to the terms of the applicable Bond Insurance Policy, (3) that, except as pro\ided in paragraph (ii) below, in the event that any such Bondholder is entitled to receive full payment of principal from Financial Guaranty, such Bondholder must tender his Series 1998 Bond or Series 1999 Bond, as the case may be, with the instrument of transfer in the form provided on the Bond executed in the name of Financial Guaranty, and (4) that, except as provided in paragraph (ii) below, in the event that such Bondholder is entitled to receive partial payment of principal from Financial Guaranty, such Bondholder must tender his Bond for payment fIrst to the Paying Agent. which shall note on such Bond the portion of principal paid by the Paying Agent, and then, with an acceptable form of assignment executed in the name of Financial Guaranty, to the Fiscal Agent, which will then pay the unpaid portion of principal to the Bondholder subject to the terms of the applicable Bond Insurance Policy. 14 eO ~.I ~~ '8El d (ii) In the event that the Paying Agent has notice that any payment of principal of or interest on a Series 1998 Bond or Series 1999 Bond, as the case may be, has been recovered from a Bondholder pursuant to the United States Bankruptcy Code by a oustee in bankruptcy in accordance with the final, nonappealable order of a court having competent jurisdiction, the Paying Agent shall, at the time it provides notice to Financial Guaranty, notify all Series 1998 Bondholders or Series 1999 Bondholders, as the case may be, that in the event that any such Bondholder's payment is so recovered, such Bondholder will be entitled to payment from Financial Guaranty to the extent of such recovery, and the Paying Agent shall furnish to Financial Guaranty its records evidencing the payments of principal of and interest on the Series 1998 Bonds or the Series 1999 Bonds, as the case may be, which have been made by the Paying Agent and subsequently recovered from Series 1998 Bondholders or Series 1999 Bondholders, as the case mav be, and the dates on which such payments were made. (jii) Financial Guaranty shall, to the extent It makes payment of principal of or interest on Series 1998 Bonds or Series 1999 Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the applicable Bond Insurance Policy and. to e\1dence such subrogation. (a) in the case of subrogation as to claims for past due interest, the Paying Agent shall note Financial Guaranty's rig.hts as subrogee on the registration books maintained by the Registrar upon receipt from Financial Guaranty of proof of the payment of interest thereon to the holders of such Bonds and (b) in the case of subrog.ation as to claims for past due principal, the Registrar shall note Financial Guaranty's rights as subrogee on the registration books for the applicable Series 1998 Bonds or Series 1999 Bonds maintained by the Registrar upon receipt of proof of the payment of principal thereof to the holders of such Bonds. Notwithstanding anything in the Resolution or the Series 1998 Bonds or Series 1999 Bonds to the contrary, the Paying Agent shall make payment of such past due interest and past due principal directly to Financial Guaranty to the extent that Financial Guaranty is a subrogee with respect thereto. (i\') The notice address for Financial Guaranty and the Fiscal Agent shall be included Financial Guaranty Insurance Company 115 Broadway New York, New York 10006 Attention: Risk Management State Street Bank and Trust Company, N.A. 61 Broadway New York, New York 10006 Attention: Corporate Trust Department 15 , ~!='1" (e) Additional PrO\isions. (i) l\omithstanding satisfaction of other conditions to the issuance of Additional Bonds contained in the Resolution, no such issuance may occur (other than refunding Bonds which produce debt seT\ice savings for the Issuer) should any Event of Default have occurred and be continuing without the prior wrinen consent of Financial Guaranty; (ii) notice of any redemption of Series 1998 Bonds or Series 1999 Bonds. other than mandatory sinking fund redemption and excepting any notice that refers to Series 1998 Bonds or Series 1999 Bonds. as the case may be, that are the subject of an advance refunding. shall state that such notice is conditional, i.e. that such redemption will occur only if sufficient funds are deposited with the Paying Agent on the applicable redemption date to pay the redempnon price of the Bonds to be redeemed, otherwise, such notice shall be deemed rescinded; (iii) any successor Paying Agent for either the Series 1998 Bonds or the Series 1999 Bonds must have combined capital. surplus and undi"ided profits of at least 550 million. unless Financial Guaranty shall othemise approve; (iv) no resignation or removal of the Paying Agent shall become effective until a successor has been appointed and has accepted the duties of Paying Agent: (v) Financial Guaranty shall be furnished with vmnen nonce of the resignation or removal of the Paying Agent and the appointment of an~ successor thereto: (\i) the Pa~ing Agent and any applicable receiver or trustee shall not take the Bond Insurance Policies into account In determining whether the rights of Series 1998 or Senes 1999 Bondholders are ad\'ersely affected by actions taken pursuant to the terms and prOVisions of the Resolution: (vii) the Issuer or the Paying Agent shall provide Financial Guaranty with immediate notice of any payment default and notice of any other default known to the Issuer within 30 days of their knowledge thereof: (\iii) Financial Guaranty shall be IOcluded as a party in IOtereSl and as a party entitled to (a) notify the Issuer. the Paying Agent and any applicable receiver or trustee of the occurrence of an Event of Default and (b) request the Issuer. and any applicable receiver or trustee to intervene in Judicial proceedings that affect the Series 1998 Bonds or the Series 1999 Bonds or the security therefor: the Issuer and any applicable receiver or trustee shall be required to accept notice of default from FlOancial Guaranty; (ix) for all purposes of Article VIl of the Resolution (except the g!\mg of notice of default to Bondholders). Financial Guaranty shall be deemed to be the sole holder of the Senes 1998 Bonds and the Series 1999 Bonds so long as it has not faded to comply with its obligations under the Bond Insurance Policies: (x) Financial Guaranty shall be provided with a full transcript of proceedings relating to the execution of any Supplemental Resolution; (xi) in determining whether a payment default on the Series 1998 Bonds or the Series 1999 Bonds has occurred, no effect shall be given to payments made under the applicable Bond Insurance Policy; (xii) any Supplemental Resolution adopted by the Issuer pursuant to Section 8.02 of the Resolution shall be subject to the prior ....Tinen consent of Financial Guaranty (any rating agency rating the Series 1998 Bonds or the Series 1999 Bonds shall receive nonce of each such Supplemental Resolution and a copy thereof at least 15 days in advance of the adoption thereof); and (xiii) in the event of an advance refunding of the Series 1998 Bonds or the Series 1999 Bonds, the Issuer shall cause to be dehered a verification report of an independent nationally recognized certified public 16 ,. ~ f 1~'1 accountant relating to the sufficiency of cash and/or Refunding Securities to pay the principal of, redemption premium, if any, and interest on the Bonds to be refunded, as the same become due or are redeemed. SECTION 18. SECOl'iDARY MARKET DISCLOSURE. Subject in all respects to the satisfaction of the conditions set forth in Section 6 hereof, the Issuer hereby covenants and agrees that, in order to provide for compliance by the Issuer with the secondary market disclosure requirements of the Rule, it will comply with and carry out all of the pro\isions of each of the Continuing Disclosure Certificates to be executed by the Issuer and dated the respective dated dates of the Series 1998 Bonds and the Series 1999 Bonds, as they may be amended from time to time in accordance with the terms thereof. The eontinuing Disclosure eertificates shall be substantially in the forms of Exhibit F hereto with such changes, amendments, modifications, omissions and additions as shall be approved by the Chairman who is hereby authorized to execute and delivery such Certificates. Notwithstanding any other provision of the Resolution. failure of the Issuer to comply with such Continuing Disclosure Certificates shall not be considered an Event of Default under the Resolution; provided, however. to the extent permitted by law, the sole and exclusive remedy of any Series 1998 Bondholder or Series 1999 Bondholder for the enforcement of the pro\isions of the respective Continuing Disclosure Certificates shall be an action for mandamus or specific performance, as applicable, by court order, to cause the Issuer to comply with its obligations under this Section 18 and the respective Continuing Disclosure eertificates. For purposes of this Section 18, "Series 1998 Bondholder" and "Series 1999 Bondholder" shall mean 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 1998 Bonds or Series 1999 Bonds. as the case may be (including persons holding such Bonds through nominees, depositories or other intermediaries), or (B) is treated as the mvner of any such Bond for federal income tax purposes. SECTIO~ 19. GEl'iERAL AUTHORITY. The members of the Governing Board of the Issuer, 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 Official Statement, the Continuing Disclosure Certificates, the Escrow Deposit Agreements or the Purchase Contracts or desirable or consistent with the requirements hereof or the Resolution, the Official Statement, the eontinuing Disclosure Certificates, the Escrow Deposit Agreements or the Purchase Contracts for the full puncnJal and complete performance of all the terms, covenants and agreements contained herein or in the Refunding Bonds, the Resolution, the Official Statement, the Continuing Disclosure Certificates, the Escrow Deposit Agreements and the Purchase Contracts and each member, employee, anorney and officer of the Issuer and the Clerk is hereby authorized and directed to execute and deliver any and all papers and instruments and to be and cause to be done any and all acts and things necessary or proper 17 ",,~~~. '1.... RFll1't for carrying out the transactions contemplated hereunder. The Issuer hereby authorizes its Financial Advisor and Bond Counsel to do all things necessary to acquire the Series 1991 Refunding Securities and the Series 1992 Refunding Securities. In the event the Chairman is absent or unavailable to perform any function or duty hereunder, the Vice-Chairman is hereby authorized to perform any and all of such functions or duties. SECTIO:'\ 20. SEVERABILITY A~D INVALID PROVISIO!liS. If anyone or more of the covenants, agreements or provisions herein contained shall be held contrary to any express pro"ision of law or contrary to the policy of express law. though not expressly prohibited or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and \'oid 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 Refunding Bonds. SECTIO!li 21. RESOLUTIO!li TO CO!liTI!liUE I~ FORCE. Except as herein expressly provided, the Resolution and all the terms and pro\isions thereof are and shall remaIn in full force and effect. SECTlO~ 22. EFFECTIVE DATE. This Supplemental Resolution shall become effective immediately upon its adoption. DUL \' ADOPTED, in Regular Session this 24th day of ;\ovember, 1998. COLLIER COU~TY \VA TER-SEWER DISTRICT (SEAL) ........ . "i/. "'. BY~~""'~~~ .... Chairm Board of CouiJ'iy Co is s of . Collier County, Florida, :::!IS the' Ex-Officio': Chairman of the Governing B9.ard of the Colli~{' County Water-Sewer District """'1' .,.::~., I J I ~ I II i ' .' . ATTEST: :! . . ;~~ '(Perk, d of County Commiss e1'S . ~:" 'Of Collier Colint>'. Florida, as Ex-Officio .0; '. . _ ~ . , 1.~ ..)" ... 'I". .,' 18 ''1':','' " t;;,. ,-1''"' ,]110' ~~- .. ,. !' 1~;' , 5.:. '. . '.' ". " " , Clerk of the Governing Board of the Collier County Water-Sewer District APPROVED AS TO FORM AND LEGAL SUFFICIENCY: ~ML~ ~ -Jv-/~--, District Attorney ,.".,.,......"'..",... ......"...~..~ " ,~. :f": -~...,~-.,r:~.............<' '.~"'I,~ '1-;.'..... ~"':) . ."~...:~~~. A 'E i 4." \';'1 .' 1 I I I ! 19 1 RE1-- EXHIBIT A FORM OF SERIES 1998 PURCHASE CONTRACT