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64-FF
RESOLUTION NO. 6~-FF A RESOLUTION PROVIDING FOR THE ACQUISITION AND CONSTRUCTION OF EXTENSIONS, ADDITIONS, AND IMPROVEMENTS TO THE SEWER SYSTEM OF THE COMBINED WATER AND SEWER SYSTEM OF THE CITY OF BOYNTON BEACH, FLORIDA; PROVIDING FOR THE ISSUANCE CF $6,000,0~v0 REFUNDING AND IMPROVE- MENT REVENUE BONDS OF SUCH CITY TO PROVIDE FOR THE REFUNDING OF CERTAIN OUTSTANDING REVENUE OBLIGATIONS OF THE CITY AND TO PAY THE COST OF SUCH EXTENSIONS, ADDITIONS AND IMPROVEMENTS; PROVIDING FOR THE RIGHTS OF THE HOLDERS OF SUCH BONDS; PROVIDING FOR THE PA~ENT THEREOF; AND MAKING CERTAIN OTHER COVENANTS AND AGREEMENTS IN CONNECTION WITH THE ISSUANCE AND SALE OF SUCH BONDS. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BOYNTON BEACH, FLORIDA: SECTION 1. AUTHORITY OF THIS RESOLUTION. This resolution is adopted pursuant to the Charter of the City of Boynton Beach, constituting Chapter 24~98, Laws of Florida, Acts of 1947, as amended and supplemented. SECTION 2. FINDINGS° It is hereby ascertained, deter- mined and declared that: (A) The City of Boynton Beach, Florida, (hereinafter called "City"), now owns, operates and maintains a municipal water system and a municipal sewer system as a combined and consolidated water and sewer system, (hereinafter called "Water and Sewer System"). (B) The Town of Ocean Ridge has heretofore granted to the City a franchise for the construction of certain water mains, fire hydrants and distribution facilities in said Town, and for the supply of water to the inhabitants of said Town for a period of thirty years from February 23, 19~l; under the term' of said franchise said water mains, fire hydrants and distribu- tion facilities constructed by the City in the Town of Ocean Ridge are owned by and are the property of the City, and a part of its Water System; under the terms of said franchise the water mains and distribution facilities existing in the Town of Ocean Ridge which were then served by the Water System of the City, pursuant to Chapter 1%088, Laws of Florida, Acts of 19S1, continued to remain the property of said Town, but were continued to be and are now supplied with water by the Water System of the City under the condition~ provided by.said statute and said franchise. (C) The City derives revenues from rates, fees and other charges made and collected for the services and facilities of said Water and Sever System. Said revenues are not pledged or encumbered in any manner; except that the revenues of the Water System are pledged for the payment of the principal of and interest on the outstanding bonds of an original issue of $228,000 Water Revenue Bonds heretofore issued by the City under date of December l, 1950, (herein-after called "Outstand- ing 1950 Bonds"), and for the payment of certain non-interest bearing refunding agreements heretofore entered into by the City with various contractors (hereinafter called "Outstanding Contractors' Refunding Agreements"), which Outstanding Con- tractors' Refunding Agreements are payable from the revenues of a portion of said Water System; and except that the revenues of the Water and Sewer System are pledged for the payment of the outstanding bonds of an issue of $1,370,00~ Water Revenue Bonds, Series 1960, dated December l, 1960 (hereinafter called "Outstanding 1960 Bonds"); for the payment of the outstanding bonds of an issue of $1,750,000 Water and Sewer Revenue Bonds, Issue of 1961, Series A, dated December l, 1961 (hereinafter referred to as "Outstanding Series A Bonds"), and for the pay- ment of the outstanding bonds of an issue of $1,6~0,©©0 Water and Sewer Revenue Bonds, Issue of 1961, Series B~ dated December l, 1961 (hereinafter referred to as "Outstanding Series B Bonds"). The Outstanding Series B Bonds are additionally secured by a pledge of the Utilities Service Taxes and by the proceeds from certain Special Assessments, levied by the City. (D) $148,000.00 of the 0~tstanding 1950 Bonds will be outstanding and unpaid on June l, 1964; $90,272.30 will be outstanding and unpaid on the Outstanding Contractors' Refund- ing Agreements on June l, 1964; $1,345,000 of the Outstanding 1960 Bonds will be outstanding and unpaid on June l~ 1964; ~1,745,000 of the Outstanding Series A Bonds will be outstand- ing and unpaid on June 1, 196~; and $1,630,000 of the Out- standing Series B Bonds will be outstanding and unpaid on June l, 1964. (E) The Outstanding Contractors' Refunding Agreements are payable, as a whole, at any time at the principal amount thereof. The Outstanding 1950 Bonds are neither payable nor redeemable prior to their respective maturities. A portion of the Outstanding 1960 Bonds are neither payable nor redeemable, as a whole, prior to June l, 1971; however, such Outstanding 1960 Bonds unmatured and unpaid on June l, 1971 are subject to prior redemption, as a ~ole, on such date, plus an applicable premium and accrued interest to date of redemption. A portion of the Outstanding Series A Bonds and the Outstanding Series B Bonds are neither payable nor redeemable, as a whole, prior to June l, 1972; however, such Outstanding Series A Bonds and Outstanding Series B Bonds unmatured and unpaid on June l, 1972 are subject to prior redemption, as a whole, on such date, plus an applicable premium and accrued interest to the date of redemption. (F) All of such Outstanding 1960 Bonds, Outstanding Series A Bonds and Outstanding Series B Bonds may be refunded at any time by investing a portion of the proceeds of the sale of the revenue bonds, herein authorized, in the manner provided in Section 15 hereof, and by depositing such investments in trust so that the net income received on such investments and the principal thereof will be sufficient and available to pay maturing principal of and interest on all such outstanding obligations when due or upon the prior redemption thereof on their respective redemption dates, together with the premiums required. Such outstanding obligations may be advantageously refunded with substantial benefit to the City in the saving of interest during the remaining terms of'such outstanding obliga- tions. It is in the best interest of the City to provide for the refunding of such outstanding obligations and to acquire funds for the project, hereinbelow described, by the issuance ~nd sale of the revenue bonds in the manner herein set forth. (G) It is necessary and essential to construct and acquire additions, extensions and improvements to the Sewer System of the combined Water and Sewer System, as provided herein, in order to preserve and protect the public health~ safety and welfare of the inhabitants of the City. (H) The revenues estimated to be derived in each year hereafter from the operation of the City's combined Water and Sewer System will be sufficient to pay all costs of operation and maintenance of said Water and Sewer System during such year, the principal of and interest on the revenue bonds to be issued pursuant to this resolution maturing and becoming due in such year, all sinking fund, reserve or other payments provided for in this resolution, all annual debt service requirements on the Outstanding 19~0 Bonds and the annual principal payments required to be made on the Outstanding Contractors' Refunding Agreements. (I) The principal of and interest on the revenue bonds to be issued pursuant to this resolution and all sinking fund, reserve and other payments provided for in this resolution shall be paid solely from the revenues derived by the City from the operation of its Water and Sewer System, and it will never be necessary or authorized to levy taxes on any real property in the City to pay the principal of and interest on the revenue bonds to be issued pursuant to this resolution or to make any of the sinking fund, reserve or other payments provided for in this resolution and that the revenue bonds to be issued pursuant to this resolution shall not constitute a lien upon any of the properties of said Water and Sewer System or upon any other property whatsoever of the City, except said revenues. SECTION 3. AUTHORIZATION OF CONSTRUCTION AND ACQUISI- TION CF ADDITIONS, EXTENSIONS AND IMPROVEMENTS TO SEWER SYSTEM OF COMBINED WATER AND SEWER SYSTEM AND THE REFUNDING OF OUT- STANDING REVENUE OBLIGATIONS° (A) There is hereby authorized the construction and acquisition of additions, extensions and improvements to the Sewer System of the City's combined Water and Sewer System, consisting of, but not limited to, the construction and and installation of lateral sewers and small mains, together with other facilities, extensions, improvements and additions, necessary, incidental or appurtenant thereto, including the acquisition of lands and interest therein necessary or conven- ient therefor, and all substantially in accordance with the plans and specifications therefor prepared or to be prepared by Russell & Axon, Consulting Engineers, of Daytona Beach, Fl~ida~ and approved or to be approved by this Council, at an estimated cost of not exceeding SI,100,©00, (hereinafter called "projecff)..~ Such cost shall be deemed to include the cost of the construc- tion and acquisition of said improvements, including the acqui- sition of any lands or interest therein or any other properties deemed necessary or convenient therefor; engineering, legal, and financing expenses; expenses for estimates of costs and of revenues; expenses for plans, specifications and surveys; the fees of fiscal agents, financial advisors or consultants; administrative expenses relating solely to such construction and acquisition; interest upon the revenue bonds, herein authorized, prior to, during and for six months after the completion of the project to the extent that the revenues from such Water and Sewer System are insufficient therefor; such other expenses as may be necessary or incidental to the financ- ing authorized by this resolution, and the construction and acquisition of the improvements, extensions and additions authorized by this resolution and the placing of same in operation. (B) There is hereby authorized the refunding or re- financing of the Outstanding 196© Bonds, the Outstanding Series A Bonds and the Outstanding Series B Bonds in the manner pro- vided in this resolution. (C) The issuance of the revenue bonds for the purposes expressed herein and the provisions for the payment of the principal of and the interest thereon from the net revenues of the combined Water and Sewer System are hereby found, determined and declared to be a lawful System purpose within the meaning provided in the resolution authorizing the issuance of the Outstanding 1960 Bonds, as amended and supp~emented. SECTION ~. RESOLUTION TO CONSTITUTE CONTRACT. In consideration of the acceptance of the revenue bonds authorized to be issued hereunder by those who shall hold the same from time to timer this resolution shall be deemed to be and shall constitute a contract between the City and such bondholders, ann the covenants and agreements herein set forth to be performed by sai~ City shall be for the equal benefit, protection and security of the legal holders of any and all such bonds and the coupons attached thereto~ all of which shall be of equal rank and without preference, priority or distinction of any of the revenue bonds or coupons over any other thereof except as expressly provided therein or herein. SECTION 5. DEFINITIONS. The following terms shall have the following meanings in this resolution unless the text otherwise expressly requires: (A) "Cit~'shall mean the City of Boynton Beach, Florida. (B) '~Town" shall mean the Town of Ocean Ridge, Florida. (C) "Act" shall mean Chapter 2~398, Laws of Florida, Special Acts of 19~7~ as amended and supplemented, and other applicable provisions of law. iD) "Bonds" shall mean the $6,000,000 Refunding and Improvement Revenue Bonds~ authorized to be issued pursuant to this resolution, and the interest coupons attached to said Bonds. (E) "Holder of Bonds" or "Bondholder"~ or any similar term, shall mean any person who shall be the bearer or owner cF any Bond or Bonds registered to bearer or not registered, or the registered owner of any outstanding Bond or Bonds which shall be at the time registered other than to bearer, or of any coupons representing interest accrued or to accrue on said Bon~. (F) "Water and Sewer System" shall mean the complete Water and Sewer System presently owned, operated and maintained by the City~ together with any and all improvements, extensions and additions thereto hereafter constructed or acquired, either from the proceeds of the Bonds or from any other source, 6 together with all lands or interests therein, plants, buildings, machinery, franchises, pipes, fixtures, equipment, and all property, real or personal, tangible or intangible, now or hereafter owned or used by said City in connection therewith; provided, however, that the water distribution facilities existing in the Town of Ocean Ridge prior to the granting of the franchise to said City by the Town, shall, pursuant to Chapter 1~O88, Laws of Florida, Acts of 19~l, and pursuant to said franchise granted by the Town to the City, remain the property of the Town; and, provided further, that all revenues derived by the City from the supplying of water to inhabitants or users through said existing water distribution facilities of the Town shall be deemed revenues of said Water and Sewer System as fully and to the same extent as all other revenues of said Water and Sewer System. (G) "Facilities" shall mean all the facilities of said Water and Sewer System, and all parts thereof, existing at the time of the adoption of this resolution, and also any facilit~s which may hereafter be added to said Water and Sewer System, er any part thereof, by any additions, betterments, extensions, improvements thereto, or property of any kind or nature, real or personal, tangible or intangible, hereafter constructed or acquired in connection with said Water and Sewer System. (H) "Gross Revenues" or "Revenues" shall mean all fees, rentals or other charges or other income received by the City, or accruedUto the~'~Ci~.y or tg say Board~or Agency of the City in control of the management and operation of said Water and Sewer System, and all parts thereof, from the operation Of said Water and Sewer System, all as calculated in accordance with sound accounting practice, and shall be deemed to include all fees, rentals or other charges or other income received by the City from the supplying of water to inhabitants or users located in the Town through existing water distribution facili- ties in said Town which remain the property of the Town. (I) "Operating Expenses" shall mean the current expenses, paid or accrued, of operation, maintenance and repair 7 of the Water and Sewer System and its facilities and shall include, without limiting the generality of the foregoing, administrative expenses relating soley to said Water and Sewer System, insurance premiums, an operating reserve in the amount certified to by the Consulting Engineers as the reasonable amount necessary for one month's cost of operation, maintenance and ordinary current repairs of said Water and Sewer System, and such other reasonable current expenses as shall be in accordance with sound accounting practice. "Operating Expenses" shall not be deemed to include the cost of the maintenance and repair of the water distribution facilities existing in the Town prior to the granting of the franchise to the City by the Town, which said Town is obligated to pay under said Chapter 15088, Laws of Florida, Acts of 1931, and said franchise. (J) "Net Revenues" shall mean the gross revenues, as defined in subsection (H) above, remaining after deduction only of the costs of Operating Expenses, as defined in subsection (I) above. (K) "Consulting Engineers" shall mean Russell & Axon, Engineers of Daytona Beach, Florida, or such other firm of qualified and nationally recognized engineers as may hereafter be employed by the City. (L) "Franchise" shall mean the franchise granted to sai~ City by said Town referred to in Section 2 (B) hereof. (M) "Outstanding 1960 Bonds" shall mean the Water Revenue Bonds, Series 1960, of the City, outstanding after June l, 1964. (N) "Outstanding Series A Bonds" shall mean the $1,74~,000 Water and Sewer Revenue Bonds, Issue of 1961, Series A, of the City, outstanding after June l, 1964. (0) "Outstanding Series B Bonds" shall mean the $1,630,o00 Water and Sewer Revenue Bonds, Issue of 1961, Series ~, ef~the City, outstanding after June l, 1964. (P) "Outstanding Bonds" shall mean the Outstanding 1960 Bonds, the 0utstanding~Se~ies A'Bonds 'and the Outstanding Series B,, Bonds. 8 "(Q) "Outstanding SEries A and Series B Bonds...Retire~.?' ment Fund" or "Series A and Series B Bonds Retirement Fund" shall mean the trust fund herein created and established, into which shall be deposited a portion of the proceeds from the sale of the Bonds to be applied to the retirement of the Out- standing Series A Bonds and Series B Bonds. (R) "Retirement of the Outstanding Bonds" or words of similar import shall mean the payment or provision for payment of the principal of the Outstanding Bonds, any applicable redemption premium and the interest maturing upon such Out- standing Bonds to their earliest respective redemption dates. Such phrase shall also mean the discharge and release of the pledge of and lien on the net revenues of the combined Water and Sewer System held by the Outstanding Bonds and the release of the pledge of and lien on the Utilities Services Taxes and on the proceeds of certain Special Assessments held by the Outstanding Series B Bonds. (S) Words importing singular number shall include the plural number in each case and vice versa, and words importing persons shall include firms and corporations. SECTION 6. AUTHORIZATION OF BONDS. Subject and pursu- ant to the provisions of this resolution, obligations of the City to be known as Refunding and Improvement Revenue Bonds are hereby authorized to be issued in the aggregate principal amount of not exceeding Six Million Dollars ($6,000,000), for the principal purposes of financing the cost of the construc- tion and acquisition of the extensions, additions and improve- ments to the Sewer System of the combined Water and Sewer System of the City and for refunding the presently Outstanding Bonds, which such purposes are hereby authorized. SECTION 7. DESCRIPTION OF BONDS. The Bonds shall be dated June l, 196W; shall be in the denomination of $~,000 each; shall be numbered consecutively from i upward; shall bear interest at a rate or rates not exceeding the legal rate, payable semi-annually on December i and June i of each year, and shall mature on June I of each year as follows: 9 YEAR AMOUNT Y, EAR AMOUNT 1965 $ 65,000 1985 1966 70,000 1986 1967 70,000 1987 150,000 1968 75,000 1988 1969 ~ 5,000 1989 160,000 1970 ~0,000 1990 170,000 1971 80,000 1991 175,000 1972 85,000 1992 180,000 197~ 90,000 199~ 190,000 1974 90,000 199~ 195,000 1975 9~,000 1995 205,000 1976 lO0,O00 1996 210,000 1977 105,000 1997 220,000 1978 105,000 1998 225,000 1979 ll0,O©O 1999 235,000 1980 llS,000 2000 245,000 1981 120,000 2001 255,000 1982 125,000 2002 265,000 1983 130,000 2003 275,000 1984 135,000 2004 285,000 The Bonds maturing in the years 1965 to 1974, both inclusive, shall not be redeemable prior to maturity. The Bonds maturing in 1975 and thereafter shall be redeemable prior to maturity~ at the option of the City, in whole on any date on or after June 1, 1974, or in part, in inverse numerical order~ on any interest payment date on or after June 1, 1974, at the price of par plus accrued interest plus the following premiums, expressed in percentages of the par value thereof, if redeemed in the following years: year Premium year Premium 1974 or 1975 1976 or 1977 1978 or 1979 198o or 1981 4 ~ 1982 or 1983 i½~ 3~.~ 1984 or 1985 1986 or 1987 23½ 1988 or thereafter ½% Notice of any such redemption shall be published at least once at least thirty (30) days prior to the date fixed for redemption, in a financial paper published in the City of New York, New York. Interest shall cease on any of said Bonds duly called for prior redemption if payment of the redemption price has been duly made or provided for. Said Bonds shall be issued in coupon form, shall be payable with respect to both principal and interest at such place or places either within or without the State of Florida, as shall hereafter be designated by resolution of the City Council on or prior to the sale of said Bonds in lawful money of the United States of America, and shall bear interest from lO their date, payable in accordance with and upon surrender of the appurtenant interest coupons as they severally mature. SECTION 8. (A) EXECUTION OF BONDS AND COUPONS. Said Bonds shall be executed in the name of the City by the Mayor, and its corporate seal, or a facsimile thereof, shall be affixed thereto or impressed, imprinted, lithographed or reproduced thereon and attested by the City Clerk. The facsimile signatures of said Mayor and City Clerk may be imprinted, lithographed or reproduced on said Bonds and on the validation certificate appearing thereon, provided that at least one of said officers shall manually apply his signature on said Bonds. In case one or more of the officers who shall have signed or sealed any of the Bonds shall cease to be such officer of the City before the Bonds so signed and sealed shall have been actually sold and delivered, such Bonds may neverthe- less be sold and delivered as herein provided and may be issued as if the person who signed or sealed such Bonds had not ceased to hold such office. Any Bond may be signed and sealed on behalf of the City by such person who at the actual time of the execution of such Bond shall hold the proper office in the City, although at the date of such Bonds such person may not have held such office or may not have been so authorized. The coupons to be attached to the Bonds shall be authenticated with the facsimile signatures of the present or any future Mayor and City Clerk of said City, and the City may adopt and use for that purpose the facsimile signature of any· person who shall have been such Mayor or City Clerk at any time on or after the date of the Bonds, notwithstanding that he may have ceased to be such Mayor or City Clerk at the time when such Bonds shall be actually sold and delivered. (B) NEGOTIABILITY AND REGISTRATION. The Bonds shall b~ and have all the qualities and incidents of negotiable instru- ments under the law merchant and the Negotiable Instruments Law of the State of Florida, and each successive holder, in accept- ing any of said Bonds or the coupons appertaining thereto, shall be conclusively deemed to have agreed that said Bonds ll shall be incontestable in the hands of a bona fide holder for value. The Bonds may be registered at the option of the holder as to principal only, or as to both principal and interest, at the office of the City Clerk of the City, such registration to be noted on the back of said Bonds in the space provided there- for. After such registration as to principal only, or both principal and interest, no transfer of the Bonds shall be valid unless made at said office by the registered Owner, or by his duly authorized agent or representative and similarly noted on the Bonds, but the Bonds may be discharged from registration by being in like manner transferred to bearer and thereupon transferability by delivery shall be restored. At the option of the holder, the Bonds may thereafter again from time to time be registered or transferred to bearer as before. Subh registration as to principal only shall not affect the negotiability of the coupons which shall continue to pass by delivery. The City may make a reasonable chsrge for every such transfer sufficient to reimburse it for any expenses incurred in connection with such transfer. SECTION 9. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case any Bond shall become mutilated or be destroyed, stolen or lost, the City may in its discretion issue and deliver a new Bond with all unmatured coupons, if any, so mutilated, destroyed, stolen or lost in exchange and substi- tution for such mutilated Bond, upon surrender and cancellation of such mutilated Bond and attached coupons, if any, or in lie~ of and substitution for the Bond and attached coupons, if any, destroyed, stolen or lost, and upon the holder furnishing the City proof of his ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and con- ditions as the City may prescribe and paying such expenses as the City may incur. All Bonds and coupons so surrendered shall be cancelled by the City Clerk and held for the account of the City. If any such Bond or coupon shall have matured or be about to mature, instead of issuing a substitute Bond or 12 coupon, the City may pay the same, upon being indemnified as aforesaid, and if such Bond or coupon be lost, stolen or destroyed, without surrender thereof. Any such duplicate Bonds and coupons issued pursuant to this section shall constitute original, additional con- tractual obligations on the part of the City, whether or not the lost, stolen or destroyed Bonds or coupons be at any time found by anyone, and such duplicate Bonds and coupons shall be entitled to equal and proportionate benefits and rights as to lien on and source and security for payment from the revenues of the Water and Sewer System pledged herein with all other Bonds and coupons issued hereunder. SECTION l©. CITY ATTORNEY. The City Attorney shall certify on the face of each Bond that such Bond and the attached coupons have been approved by him as to form and correctness. SECTION ll. FORM OF BONDS AND COUPONS. The text of the Bonds and coupons shall be of substantially the following tenor, with such omissions, insertions and variations as may be necessary and desirable and authorized or permitted by this resolution or any subsequent ordinance or resolution adopted prior to the issuance thereof: No. $ ~, 000 UNITED STATES OF M~ERICA STATE OF FLORIDA COUNTY OF PA~i BEACH CITY OF BOYNTON BEACH REFUNDING AND IMPROVEMENT REVENUE BOND KNOW ALL MEN BY THESE PRESENTS that the City of Boynton Beach, Florida, (hereinafter called"City"), for value received, hereby promises to pay to the bearer, or if this Bond be registered, to the registered holder as herein provided, on the first day of June, 19 ..., from the revenues hereinafter mentioned, the principal sum of FIVE THOUSAND DOLLARS ($~,000) with interest thereon at the rate of per~centum ( %) per annum, payable semi-annually on the first day of December and the first day of June in each year upon the presentation and surrender of the annexed coupons as they severally fall due. Both principal of and interest on this Bond are payable in lawful money of the United States of America at , or, at the option of the holder at This Bond is one of an authorized issue of Bonds in the aggregate principal amount of $6,000,000 of like date, tenor and effect, except as to number, interest rate and date of maturity, issued to finance the cost of refunding certain revenue obligations of the City and the cost of the construc- tion and acquisition of additions, extensions and improvements to the Sewer System of the combined Water and Sewer System of the City, under the authority of and in full compliance with the Constitution and Statutes of the State of Florida, includ- ing particularly Chapter 2~398, Laws of Florida, Acts of 19W7, as amended and supplemented, and other applicable provisions of law, and a resolution duly adopted by the City Council of the City on the 30th day of JULY, 196~, (hereinafter called "Resolution"), and is subject to all the terms and conditions of said Resolution. The Bonds, and the coupons appertaining thereto, are payable solely from and secured by a lien upon and pledge of the net revenues derived from the operation of the combined Water and Sewer System of the City in the manner provided in the Resolution. Reference is made to the Resolution for the provisions, among others, relating to the terms and security of the Bonds, the custody and application of the proceeds of the Bonds, the rights and remedies of the holders thereof and the rights, duties and obligations of the City. The original holder and each successive holder of this Bond, by his acceptance hereof, irrevocably assents to all of the terms, conditions and pro- visions of such Resolution. The Bonds maturing in 1975 and thereafter are redeemabl~ prior to maturity, at the option of the City, in whole on any date on or after June 1, 197W, or in part, in inverse numerical order, on any interest payment date on or after June l, 1975, at the price of par and accrued interest, plus the following premiums, expressed in percentages of the par value thereof, if redeemed in the following years: Year ?~emiu~. year Premium 197~ or 1975 W ~ 1982 or 198~ 2 % 1976 or 1977 ~½~ 198~ or 1985 1½~ 198o or 1981 2½% 1988 or thereafter A notice of any such redemption shall be published at least once, at least thirty (50) days prior to the redemption date, in a financial paper published in the City of New York, New York, and interest will cease on any of said Bonds duly called for prior redemption if payment of the redemption price has been duly made or provided for. This Bond does not constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision or limitation, and it is expressly agreed by the holder of this Bond and the coupons appertaining thereto that such holder shall never have the right to require or compel the excrcise of the ad valorem taxing power of said City for the payment of the principal of and interest on this Bond or the making of any sinking fund, reserve or other pay- ments provided for in the Resolution. It is further agreed between the City and the holder of this Bond that this Bond and the obligation evidenced there- by shall not consitutue a lien upon the City's Water and Sewer System, or any part thereof, or on any other property of or in the City, but shall constitute a lien only on the net revenues derived from the operation of said Water and Sewer System, in the manner provided in the Resolution. The City in said Resolution has covenanted and agreed with the holders of the Bonds of the issue of which this Bond is one to fix, establish, maintain and collect rates, fees, rentals or other charges for the services and facilities of the City's Water and Sewer System, and to revise the same from time to time whenever necessary, as will always provide funds in each year sufficient to pay all costs of oper~tion and maintenance of said Water and Sewer System in such year, one hundred twenty-five per centum of the maximum annual debt service requirements for the Bonds of the issue of which this Bond is one, and certain other outstanding revenue obligations described in the Resolution in any succeeding year, and that such rates, fees, rentals or other charges shall not be reduced so as to be insufficient to provide adequate revenues for such purposes; and said City has entered into certain further covenants with the holders of the Bonds of this issue for the terms of which reference is made to the Resolution. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of this Bond, exist, have happened end have been performed in regular and due form and time es required by the Laws end Constitution of the State of Florida applicable thereto, and that the issuance of this Bond, end of the issue of Bonds of which this Bond is one, does not violate any constitutional, statutory or charter limita- tions or provisions. This Bond, and the coupons eppertaining thereto, is and has ell the qualities and incidents of, a negotiable instrument under the law merchent and the Negotieble Instruments Law of the State of Florida, and the original holder and each suc. cessive holder of this Bond, or of the coupons appertaining thereto, shall be conclusively deemed by his acceptance thereof to heve agreed that this Bond end the coupons appertaining thereto shall be end have all the quelities and incidents of negotiable instruments under the law merchant and the Negoti- able Instruments Law of the State of Florida. This Bond may be registered es to principal only, or as to both principel and inberest, in accordance with the pro- visions endorsed hereon. IN WITNESS WHEREOF, the City of Boynton Beach, Florida, has issued this Bond and has caused the seme to be signed by 16 the manual or facsimile signature of its Mayor, and the corpo- rate seal of said City or a facsimile thereof to be affixed, impressed, imprinted, lithographed or reproduced hereon and attested by the manual or facsimile signature of its City Clerk, and has caused the interest coupons hereto attached to be executed with the facsimile signatures of the said Mayor and City Clerk, all as of the 1st day of June, 196~. CITY OF B0~TON BEACH, FLORIDA (SEAL) ATTEST: Mayor City Clerk The foregoing Bond and attached coupons have been approved by me as to form and correctness. City Attorney No o FOE~ OF COUPON On the 1st day of $ ., 19 , the City of Boynton Beach, Florida, will pay to the bearer at , or, at the option of the holder, at , from the revenues de~ cribed in the Bond to which this coupon is attached, the sum of Dollars ($ ), in lawful money of the United States of America, upon presentation and surrender of this coupon, being six months' interest then due on its Refunding and Improvement Revenue Bond, dated June l, 196~, No. CITY OF BOYNTON BEACH, FLORIDA Mayor City Clerk (To be inserted in coupons maturing after callable date) "Unless the Bond to which this coupon is attached shall have been previously duly called for prior redemption and payment thereof duly made or provided for." 17 VALIDATION CERTIFICATE This Bond is one of a series of Bonds which were validated and confirmed.by decree of the Circuit Court of the Fifteenth Judicial Circuit of the State of Florida, in and for Palm Beach County, rendered on the day of , 196~. Mayor .... City 'Clerk' PROVISION FOR REGISTRATION This Bond may be registered in the name of the holder on the books to be kept by the City Clerk as Registrar, or such other Registrar as may be hereafter duly appointed, as to principal only, such registration being noted hereon by such Registrar in the registration blank below, after which no transfer shall be valid unless made on said books by the registered holder or attorney duly authorized and similarly noted in the registration blank below, but it may be discharged from registration by being transferred to bearer, after which it shall be transferable by delivery, but it may be again registered as before. The registration of this Bond as to principal shall not restrain the negotiability of the coupons by delivery merely, but the coupons may be surrendered and the interest made payable only to the registered holder, in which event the Registrar shall note in the registration blank below that this Bond is registered as to interest as well as princi- pal, and thereafter the interest will be remitted by mail to the registered holder. At the request of the holder, this Bond, when converted into a Bond registered as to both princi- pal and interest may be reconverted into a coupon Bond and again converted into a Bond registered as to both principal an~ interest as hereinabove provided. Upon reconversion of this Bond, when registered as to principal and inter&st into a'cou- pon Bond, coupons representing the interest to accrue upon the Bond to date. of maturity shall be attached hereto b~ the Regis- trar and the Registrar shall note in t~e registration blank below whether the Bond is registered as to principal only 18 or payable to bearer. The City may make a reasonable charge for every such transfer sufficient to reim- burse it for any expenses incurred in connection with such transfer. DATE OF : IN WHOSE NAME : EXTENT OF : SIGNATURE OF REGISTRATION : REGISTERED : REGIST~A~ION : REGIStRaR : : : : : SECTION 12. BONDS NOT TO BE INDEBTEDNESS OF THE CITY. Neither the Bonds nor coupons aopertaining th~Fet0, shall be or constitute an indebtedness of the City within the meaning of any Constitutional, statutory or charter limitation of indebtedness, but shall be payable soley from the net revenues derived from the operation of said Water and Sewer System as herein provided. No holder or holders of any Bonds, or of any coupon appertaining thereto, shall ever have the right to compel the exercise of the ad valorem taxing power of the City, or taxation in any form of any real property therein to pay said Bonds or the interest thereon. SECTION 13. BONDS SECURED BY PLEDGE OF NET REVENUES. The payment of the debt service of all of the Bonds shall be secured forthwith equally and ratably by a lien on and pledge of the net revenues derived from the operation of the Water and Sewer System. The lien of the holders of the Bonds on the net revenues derived from the combined Water and Sewer System shall be on a parity and rank equally, as to lien on and source and security for payment from said net revenues of the combined Water and Sewer System and in all other respects with any additional parity bonds hereafter issued pursuant to and within the terms, limitations and conditions contained in Section 15 (L) of this resolution. The net revenues derived from the Water and Sewer System, in an amount sufficient to pay the principal of and interest on the Bonds, and to make the pay- 19 ments provided for in this resolution, are hereby irrevocably pledged to the payment of the principal of and interest on the Bonds as the same become due; subject only to the lien thereon of certain outstanding obligations of the City more fully described in Section 16 hereof. SECTION l~. COVENANTS OF THE CITY. So long as any of the principal of or interest on any of the Bonds shall be out- standing and unpaid, or until there shall have been set apart in the Sinking Fund herein established a sum sufficient to pay, when due, the entire principal of the Bonds remaining unpaid, together with interest accrued and to accrue thereon, the City covenants with the holders of any and all of the Bonds as follows that: (A) RATES. The City will fix, establish, maintain and collect rates~ fees~ rentals or other charges for the services and facilities of the combined Water and Sewer System, and revise the same from time to time whenever necessary, as will~ al ways provide funds in each year sufficient to pay, and out of said funds shall pay, all costs of operation and maintenance of said Water and Sewer System~ one hundred twenty-five per centum of the maximum annual debt service requirement in any succeed- ing year for the Bonds, the Outstanding 19~0 Bonds and the Outstanding Contractors' Refunding Agreements~ and that such rates, fees, rentals or other charges shall not be reduced so as to be insufficient to provide adequate revenues for such purposes. (B) WATER AND SEWER SYST~ REVENUE FUND. The entire Gross Revenues derived from the operation of the combined Water and Sewer System shall upon receipt thereof be deposited in the "Water and Sewer System Revenue Fund", heretofore created and established pursuant to the resolution authorizing the issuance of the Outstanding 1960 Bonds, (hereinafter called "Revenue Fund"). Said Fund, held by the City, shall constitute a trust fund for the purposes provided in this resolution, and shall be kept separete and distinct from all other funds of the City and used only for the purposes end in the manner provided for 2O in this resolution; provided, however, that the City shall comply fully with all the covenants, agreements and provisions of the resolution which authorized the issuance of the Outstand- ing 1950 Bonds, and with the provisions of the Outstanding Contractors' Refunding Agreements as long as any of the said outstanding obligations are outstanding and unpaid or until adequate provision is irrevocably made for the payment thereof. In order to accomplish said purpose the City shall, as long as any of said outstanding obligations are outstanding and unpaid, or until adequate provision is irrevocably made for the payment thereof, keep separate records of the revenues derived from the water system and the sewer system of said combined Water and Sewer System, and apply such revenues derived from the water system in accordance with the~provisions of the proceedings which authorized said Outstanding 1950 Bonds, and the provisions of said Outstanding Contractors' Refunding Agreemen~cs, and with the provisions of this resolution. After the final payment, or the making of irrevocable provision for payment, of all said Outstanding 19~0 Bonds and said Outstanding Contractors' Refunding Agreements then all revenues derived from both the water system and the sewer system of said combined Water and Sewer System shall be deposited in the Water and Sewer System Revenue Fund, heretofore created, and applied and distributed in the manner provided in this resolution. (C) OPERATION AND MAINTENANCE° It will maintain in good condition said Water and Sewer System and all parts thereo£ and will operate the same in an efficient and economical manner~ making such expenditures for equipment and for renewal, repair and replacement as may be proper for the economical operation and maintenance thereof. (D) DISPOSITION OF REVENUES. All revenues at any time remaining on deposit in the Water and Sewer System Revenue Fund shall be disposed of on or before the fifteenth day of each month only in the following manner and in the following order: 21 (1) Revenues shall first be used for the payment of all current monthly Operating Expenses of said combined Water and Sewer System, as defined herein. (2) Revenues of the water system of the combined Water and Sewer System shall next be used to make the payments to the sinking fund, including the reserve account therein, if any, required by the resolution which authorized the issuance of the Outstanding 1950 Bonds, and to make the principal payments required to be made pursuant to, and on account of, said Out- standing Contractors, Refunding Agreements. (3~) Thereafter, all revenues remaining on deposit in the Revenue Fund shall be deposited in the "Refunding and Improvement Revenue Bond Sinking Fund", hereby created and established (hereinafter called '~Sinking Fund,). Said Sinking Fund shall be continued and maintained with a Trustee to be designated by Resolution of the City Council, as Trustee or 196~ Trustee, as long as any of the Bonds or interest thereon are .~tstanding and unpaid. The Sinking Fund shall constitute a trust fund for the purposes of this resolution and shall be held by said Trustee pursuant to the terms and provisions of this resolution. (~) The Sinking Fund, and the Principal and Interest Account, and the Reserve Account, hereinbelow established, '.~ shall be maintained under the administration and control of the Trustee as long as any of the Bonds, or interest thereon, are outstanding and unpaid. On the fifteenth day of each month the Trustee shall deposit into an account in the Sinking Fund, to be known as the Principal and Interest Account, from the moneys in said Sinking Fund, such sums as will be sufficient to pay one-sixth of all the interest maturing on the Bonds on the next interest payment date, and beginning with the fifteenth day c~ the month immediately following the delivery of the Bonds, one- twelfth of all principal maturing on the Bonds on the next prin- cipal maturity date; provided, however, that such monthly pay- ments required for the interest becoming due on December l, 196~, and for principal becoming due on June l, 196~, shall be increased proportionately to the extent required to pay such December 1, 196~ interest and such June 1, 196~ principal. The Trustee, from moneys on deposit in the Sinking Fund, shall next deposit into an account in the Sinking Fund, to be known as the Reserve Account, on the fifteenth day of each month, beginning with the fifteenth day of the first full calendar month following the date of the delivery of all or any of the Bonds authorized herein a sum equal to one-twelfth (1/12) of the annual sum of $29,938.00; provided, however, that no further deposits shall be required to be made by the Trustee into said Reserve Account when there shall have been deposited therein, and as long as there shall remain on deposit therein the sum of $299,380.00. Any withdrawals from the Reserve Account shall be subsequently restored from the first revenues of the Water and Sewer System available after all required current payments for the Principal and Interest Account and Reserve Account, in- cluding any deficiencies for prior payments, have been made in full. Moneys in the Reserve Account pursuant to this resolu- tion shall be used o~i~~ for the purpose of the payment of maturing principal of or interest on the Bonds. The Trustee shall not be required to make any further payments into the Sinking Fund when the aggregate amount of funds on deposit in the various accounts in said Sinking Fund are at least equal to the aggregate principal amount of Bonds, plus all interest accrued or to accrue on said Bonds then out- standing, or when all Bonds then outstanding shall have been previously duly called for prior redemption and sufficient funds have been irrevocably placed in trust for the payment of such Bonds then outstanding, including interest accrued thereon and redemption premium, if any. Upon the issuance by the City of any additional parity bonds under the terms, limitations and conditions provided in this resolution, the payments into the various accounts in the Sinking Fund shall be increased in such amounts in direct ratio as are necessary to make the payments required above for principal of and interest on, and reserves for such additional parity bonds. (5) The Renewal and Replacement Fund, created and established pursuant to the resolution authorizing the issuance of the 0utstanding'1960 Bonds shall be continued, maintained and held by the City as long as any of the Bonds or interest thereon, are outstanding and unpaid, and the Trustee shall con- tinue to pay to the City for deposit into such fund from the Sinking Fund, on the fifteenth day of each month in each year, an amount equal to one-twelfth of $10,000 ~util there shall be on deposit in such Renewal and Replacement Fund and as long as there shall remain on deposit therein the suez of $1©0,000; provided, however, that as long as the Outstanding 1950 Bonds are outstanding and unpaid, or until adequate provision is irrevocably made for the payment thereof, any amounts deposited in the Renewal and Replacement Fund under the proceedings which authorized the issuance of said Outstanding 1950 Bonds may be deducted from the amounts required to be deposited in such Renewal and Replacement Fund. The Funds on deposit in such Renewal and Replacement Fund shall be used only for the purpose of paying the cost of extensions, improvements or additions to, or the replacement of capital assets of said combined Water and Sewer System or any part thereof; provided, however, that upon the certification of the City Council that funds in said Renewal and Replacement Fund are not needed fcr such purposes, such excess funds shall be deposited by the City in the 1960 Bonds Retirement Account, hereinafter provided for, and used and applied in the same manner as other moneys on deposit therein; provided, further, however, that if at any time moneys in the Sinking Fund are insufficient to make the deposits pro- vided to be made into the various accounts in the Sinking Fund, moneys on deposit in the Renewal and Replacement Fund shall be withdrawn therefrom and deposited by the City in the various accounts in the Sinking Fund, in the order of priority set forth in this resolution to the extent of any deficiencies in said various accounts. (6) If on any monthly payment date, the revenues are in=u££±c±ent to place the required amount in any of the accounts or funds above provided, the deficiency shall be made up on the subsequent payment dates in addition to the payments which would otherwise be required to be made into such accounts or funds on the subsequent payment dates. (7) Thereafter, any moneys remaining on deposit in the Sinking Fund on the twentieth (20th) day of June and December in each year, after all required payments in the funds provided above have been made in full on the preceding fifteenth (l~th) day of such months shall be deemed surplus funds. On the Twentieth (2Oth) day of each June and December in which there is a surplus, said surplus shall be returned by the Trustee to the City to be used for any lawful, municipal purpose or upon direction by the City shall be retained by the Trustee to be used for the purchase or redemption of Bonds. (8) All such special funds hereinabove provided for shall constitute trust funds for the purposes provided herein for such funds. All of such funds shall be continuously and fully secured by direct obligations of the United States of America. Moneys on deposit in the Revenue ~nd shall not be invested at any time. Moneys on deposit in the Sinking Fund (except the Reserve Account therein) may be invested and reinvested by the Trustee only in direct obligations of the United States of America maturing not later than the dates on which the moneys in the accounts therin will be needed for the purposes of said Fund. The moneys in the Reserve Account in the Sinking Fund and in the Renewal and Replacement Fund may be invested and reinvested only in direct obligations of the United States of America or in time deposits in banks or trust companies represented by certificates of deposits and continu- ously secured by direct obligations of the United States of America, maturing not later than ten (10) years from the date of such investment. All income on such investments shall be deposited in the Sinking Fund. (E) SALE OF THE WATER AND SEWER SYST~. The Water and Sewer System may be sold, mortgaged~ leased or otherwise disposed of only as a whole or substantially as a whole, and only if the net proceeds to be realized shall be sufficient fully to pay the principal of and interest on the Outstanding 1950 Bonds, the principal of the Outstanding Contractors' Refunding Agree- ments and to retire all of the Bonds, and all interest thereon to their respective dates of maturity or earlier redemption date. A portion of the proceeds from such sale, mortgage, lease or other disposition of said Water and Sewer System shall immediately be deposited in the Contingency Fund, hereinafter created and established, in an amount, together with other moneys in such Fund reserved for such purpose, sufficient to pay the principal of and interest on the Outstanding 19~0 Bonds and the principal of the Outstanding Contractors' Refunding Agreements. The balance of such proceeds shall immediately be deposited in the Sinking Fund and shall be used only for the purpose of paying the principal of and interest on the Bonds, as the same shall become due, or the redemption of callable Bonds or the purchase of Bonds at a price not greater than the then redemption price thereof cr~ if such Bonds be not then callable, at a price not greater than the redemption price on the next ensuing redemption date. The foregoing provision notwithstanding, the City shall have and hereby reserves the right to sell, lease or otherwise dispose of any of the property comprising a part of the Water and Sewer System hereafter determined in the manner provided herein to be no longer necessary, useful or profitable in the operation thereof. Prior to any such sale, lease or other disposition of said property, if the amount to be received therefor is not in excess of $1,000~00, the duly authorized officer in charge of such Water and Sewer System shall make a finding in writing dete;-ming that such property comprising a part of such Water and Sewer System is no longer necessary, useful or profitable in the operation thereof, and such procee~ shall be deposited in the Renewal and Replacement Fund, and 26 used only as provided herein for such Fund. If the amount to be received from such sale, lease or other disposition of said property shall be in excess of $1,0©0.~0, but not in excess of $1©O,O00.00, the duly authorized officer in charge of such Water and Sewer System shall first make a finding in writing determining that such property comprising a part of such Water and Sewer System is no longer necessary, useful or profitable in the operation thereof, and the governing body of the City may, if it deems advisable, by resolution duly adopted, appro~ and concur in the finding of such duly authorized officer and authorize such sale, lease or other disposition of said prop- erty. The proceeds derived from any such sale, lease or other disposition of said property, in excess of $1,000.00 and not in excess of $100,000.©0 shall be placed in the Sinking Fund and shall be used for the red~ption of callable Bonds or the purchase of Bonds at a price not greater than the then redemption price thereof or, if such Bonds be not then callabl~ at a price not greater than the redemption price on the next ensuing redemption date. Such payment of such proceeds into the Sinking Fund or the Renewal and Replacement Fund shall not reduce the amounts required to be paid into said funds by other provisions of this resolution. No sale, lease or other disposition of the properties of the Water and Sewer System, except the portions of the Water System within the Town of Ocean Ridge, shall be made by the City if the proceeds to be derived therefrom shall be in excess of $10~,©~0.0~ and insufficient to pay all of the prin- cipal of Bonds then outstanding and all interest thereon to their respective dates of maturity, without the prior approval and consent in writing of the holders or their duly authorized representatives of sixty-six and two-thirds per centum (66 2/~) in amount of Bonds then outstanding. The City shall prepare the form of such approval and consent for execution by Bondholders, or their duly authorized representatives, which form shall provide for the disposition of the proceeds of the sale, lease or other disposition of such properties of such Water and Sewer System. 27 The foregoing provisions of this subsection (E) notwith- standing the Town of Ocean Ridge shall, upon the expiration of the franchise agreement with the City, have the right to pur- chase all the facilities of the Water System within such Town and owned by the City as provided in such franchise agreement, dated February 23, 1951. (F) ISSUANCE OF OTHER OBLIGATIONS PAYABLE OUT OF REVENUES. The City will not issue any other obligations, except upon the conditions and in the manner provided herein, payable from the revenues derived from the operation of said Water and Sewer System~ nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or any other charge having priority to or being on a parity with the lien of the Bonds and the interest thereon, upon any of the income and revenues of said Water and Sewer System. Any other obligations issued by the City in addition to the Bonds or additional parity bonds, including refunding bonds, provided for in subsection (L) below 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 revenues of said Water and Sewer System. (G) INSURANCE. The City will carry such insurance as is ordinarily carried by private corporations owning and operating similar utilities as the Water and Sewer System with a reputable insurance carrier or carriers, including liability insurance, and insurance against loss or damage by fire, explosion, hurricane, earthquake, cyclone, occupancy or other hazards and risks, and said property loss or damage insurance shall at all times be in an amount or amounts equal to the fair appraisal value of the buildings, properties, furniture, fixtures and equipment of said Water and Sewer System. In the time of war, the City shall also carry, in said amount, such insurance as may be available against loss or damage by the risks and hazards of wsr. (H) BOOKS AND RECORDS° The City will keep books and records of the Water and Sewer System, which shall be separate and apart from all other books, records and accounts of .the 28 City, in which complete and correct entries shall be made in accordance with standard principles of accounting of all trans- actions relating to the Water and Sewer System, and any holder of a Bond or Bonds shall have the right at all reasonable times to inspect the Water and Sewer System and all parts thereof, and all records, accounts and data of the City relating thereto. The City shall, a~ least once a year, cause the books, records and accounts of the Water and Sewer System to be properly audited by a competent auditor or accountant of recognized standing, whiCh audit shall include the number of users of the Water and Sewer System or any part thereof, and shall mail upon request and make available the report of said auditor or accountant at all reasonable times to any holder or holders of Bonds, or anyone acting for and in behalf of such taxpayer, citizen or Bondholder or Bondholders. The City shall also, at least once every year, cause said Water and Sewer System to be inspected by the Consulting Engineers, who shall make a written report of their inspection, and the City shall carry out all reasonable recommendations of such Consulting Engineers with respect to the operation and maintenance of said Water and Sewer System and the construction or acquisition of additions, extensions and improvements thereto. The Trustee shall, at least once a year, issue a written report to the City which report shall contain a record of all moneys received and disbursed by said Trustee, the num- bers and principal amount of any Bonds and coupons paid during the preceding twelve months, the status of any investments made by said Trustee from the Funds maintained by it, and the balance remaining in each Fund maintained and administered by said Trustee. Promptly after the receipt of each such audit report, engineer's report, or Trustee's report, a copy thereof shall be mailed by the City to any Bondholder who shall have filed his address with the City and requested in writing that a copy of such reports be furnished him. 29 (I) OPERATING BUDGET. The City shall annually prepare and adopt by resolution of its governing body a detailed budget of the estimated expenditures for operation and main- tenance of the Water and Sewer System during the succeeding fiscal year as established by the City. No expenditures for the operation and maintenance of the Water and Sewer System shall be made in any such fiscal year in excess of the amounts provided therefore in such budget without a written finding and recommendation by the general manager of such Water and Sewer System or other duly authorized officer in charge thereof, which finding and recommendation shall state in detail the purpose of and necessity for such increased expenditures for the operation and maintenance of the Water and Sewer System, and no such increased expenditures shall be made until the governing body of said City shall have approved such finding and recommendation by a resolution duly adopted. No increased expenditures in excess of ten per centum (10%) of the amount of such budget shall be made except upon the further certifi- cate of the Consulting Engineers that such increased expendi- tures are necessary for the continued operation of said Water and Sewer System. The City shall mail copies of such annual budget and all resolutions authorizing increased expenditures for operation and maintenance to any holder or holders of Bonds who shall file his address with the City and request in writing that copies of all such budgets and resolutions be furnished him or them, and shall make available such budgets and all resolutions authorizing increased expenditures for operation and maintenance of the Water and Sewer System at all reasonable times to any holder or holders of Bonds, or anyone acting for and in behalf of such Bondholder or Bondholders. (J) MAINTENANCE OF WATER AND SEWER SYSTEM. The City will maintain said Water and Sewer System in good condition and continuously operate the same in an efficient manner and at a reasonable cost. (K) SERVICES RENDERED TO THE CITY OR TOWN. The City will not render or cause to be rendered any free services of any nature by its Water and Sewer System, nor will any preferential rates be established for users of the same class; and in the event the City or the Town of Ocean Ridge, or any department, agency, instrumentality, officer or employee of said City or Town, or any other municipality or political subdivision of the State of Florida shall avail itself or themselves of the facilities or services provided by said Water and Sewer System, or any part thereof~ the same rates, fees or charges applicable to other customers receiving like services under similar circumstances shall be charged said City or Town and any such department, agency, instrumentality, officer or employee. Such charges shall be paid as they accru~ and the City or Town shall transfer from their general funds sufficient sums to pay such charges. The revenues so received shall be deemed to be revenues derived from the operation of the combined Water and Sewer System, and shall be deposited and accounted for in the same manner as other revenues from such operation of the Water and Sewer System. (L) ISSUANCE OF ADDITIONAL PARITY BONDS° lo The City reserves the right to issue additional bonds payable from and secured by a pledge of the net revenues of the Water and Sewer System on a parity with the Bonds. Any such additional parity bonds may be issued for the purpose of financing the construc- tion and acquisition of additions, extensions and improvements to the Water and Sewer System, subject to the following pro- visions and conditions: (a) There shall have been obtained and filed with the City Clerk a certificate of an independent certified public accountant of suitable experience and responsibility, stating (1) that the books and records of the City relating to the col- lection and receipt of such net revenues have been audited by him; (2) setting forth the amount of such net revenues re- ceived by the City during the immediately preceding twenty- four (2~) complete calendar months immediately preceding the issuance of such additional parity bonds with respect to which such certificate is made; (3) that the average annual net revenues during the immediately preceding twenty-four (2~) 31 complete calendar months, or the net revenues during the immediately preceding twelve (12) complete calendar months, whichever is the lesser, equals not less than one hundred forty per centum (1WO%) of the largest amount of principal and inter- est which will become due in each year thereafter on (i) all Bonds and all additional parity bonds, if any~ then outstand- ing, and (ii) on the additional parity bonds with respect to which certificate is made.. (b) The City shall not be in default in performing any of the covenants and obligations assumed under this reso- lution, and all payments required by this resolution to have been made into the Funds and Accounts, ~ provided hereunder, shall have been made to the full extent required. (c) In determining the amount of net revenues for the purposes of the above paragraph, the Consulting Engineers may adjust net revenues by adding thereto the following: (1) The net revenues (computed for such facility on the same basis as net revenues are computed for the Water and Sewer System) of any water or sewer utility which the City might have constructed or acquired previous to the issuance of such additional parity bonds or which the City shall be acquir- ing from proceeds of such additional parity bonds, and which, in the case of the acquisition thereof, has been operating for a part of the same base period or periods. (2) In the event a change has been made in the rate schedules for services from the Water and Sewer System prior to the issuance of the proposed additional parity bonds for a part of the same base period or periods and such change has resulted in an increase in net revenues, seventy-five per cent (75%) of an estimate made by such Consulting Engineers of such additional net revenues for the same base period or periods. (3) In the event the City shall have combined or authorized the combination of a sewer utility with the Water System and shall have established sewer rates or charges to be charged and collected from users of such sewer utility when service is rendered, seventy-five per cent (75%) of the net revenues estimated by the Consulting Engineers to be derived during the first twelve months of operation after completion of the construction or acquisition of said sewer utility, or additions, extensions and improvements thereto, from the pro- posed users of the sewer utility or part thereof to be financed by additional parity bonds, together with other funds on hand or lawfully obtained for such purpose and deposited in a Construction Trust Fund to be established for such purpose, who are then actual customers of the Water System of the City's combined Wster and Sewer System. 2. All of the Bonds originally issued pursuant to this resolution then outstanding, together with all additional parity bonds theretofore issued and then outstanding, may be refunded as a whole and the lien on the net revenues of the refunded obligations fully preserved for the refunding obliga- tions. Any part of the Bonds or iginally issued hereunder and any part of any additional parity bonds thereafter issued may be refunded and the lien of the refunded obligations on the net revenues fully preserved for the refunding obligations if: (a) The refunding bonds bear the same or a lower rate of net interest cost and the final maturity date of the re- funding bonds is not later than the final maturity date of the obligations refunded; and (b) The aggregate amount of principal and interest maturing in each year thereafter on the refunding bonds and on the part of the Bonds and of any additional parity bonds, then outstanding, which are not refunded is not greater than the aggregate amount of principal and interest which would have matured in each year thereafter on such Bonds and additional parity bonds, then outstanding, if none of such obligations were refunded. The holders of any refunding bonds issued pursuant to the provisions of this subsection L of Section 15 shall have and be entitled to the same lien on the net revenues and all rights, privileges and remedies which are granted to and vested by this resolution or any resolution supplemental thereto in the holders of the obligations so refunded, to the same extent and as fully as if such refunding obligations constituted the obligations refunded. All of the covenants, agreements and provisions in this resolution shall refer to and apply fully to any refunding bonds issued hereunder. (M) REMEDIES. Any holder of Bonds or any coupons appertaining thereto, or any trustee acting for such Bond- holders, may, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent juris- diction, protect and enforce any and all rights, including the right to the appointment of a receiver, existing under the laws of the State of Florida, or granted and contained in this resolution and may enforce and compel the performance of all duties required by this resolution or by any applicable statutes to be performed by the City or by any officer thereof, including the fixing, charging and collecting of rates, fees, rentals or other charges for the services and facilities of the Water and Sewer System. (N) ENFORCEMENT OF COLLECTIONS. The City will dili- gently enforce and collect, or cause to be enforced and col- lected, all rates, fees, rentals or other charges for the services and facilities of the Water and Sewer System, and take all steps, actions and proceedings for the enforcement and collection of such fees, rentals or other charges, which shall become delinquent to the full extent permitted or auth- orized by the laws of the State of Florida. Charges for the use of the services and facilities of the Sewer System shall be made and rendered on the same bills, insofar as practicable, as the charges for the use of water services and the City further covenants and agrees that~ to the extent permitted by law, it will discontinue, or cause the discontinuance of, the furnishing of both water services and sewer services to all delinquent users of said Water and Sewer System until all delinquent rates, fees, rentals or other charges, together with reasonable interest and other penalties~ have been fully paid and discharged, and shall adopt, or cause to be adopted, reasonable rules and regulations governing the discontinuance of water services and sewer sorvices to delin- quent users of said Water and Sewer System, including interest and penalities, and charges for the restoration of water services and sewer services when all delinquent rates, fees, rentals or other charges, together with interest and penalties, have been fully paid and discharged, in the manner provided by the laws of the State of Florida. (0) CONNECTIONS WITH SEWER SYSTEM. The City will, to the full extent permitted by law, require all lands, buildings and structures within the City which can use the facilities and services of the portion of the Water and Sewer System constituting the Sewer System, to connect with a~d use the facilities and services of such Sewer System, and to cease all other means and methods for the collection, purification, treatment and disposal of sewage and waste matter. (P) CONSULTING ENGINEERS. The City will retain Russell & Axon, Engineers, of Daytona Beach, Florida, or other qualified and recognized engineers, to supervise the construc- tion, acquisition and installation of the additions, extensions and improvements to the Sewer System of the combined Water and Sewer System authorized by this resolution; and after the completion thereof the City will retain on an annual basis said Russell & Axon, Engineers, of Daytona Beach, Florida, or other qualified and recognized engineers, to inspect and make an annual report of said Water and Sewer System and the opera- tion and management thereof, and to generally supervise the operation and maintenance of said Water and Sewer System and to perform the duties relating thereto provided for in this reso- lution. (Q) NO COMPETING SYSTEM. To the full extent permitted by law, the City will not grant, or cause, consent to, or allow the granting of, any franchise or permit to any person, firm, corporation or body, or agency or instrumentality whatso- ever, for the furnishing of water or sewer services to or within the City of Boynton Beach. (R) MAINTENANCE OF FRANCHISE WITH TOWN OF OCEAN RIDGE. The City will continue to maintain and perform the terms of the franchise with the Town of Ocean Ridge, and will not rescind, or consent to, or permit the rescission of, said fran- chise, or alter or modify, or consent to or permit the altera- tion or modi£ication of said franchise in any way which will materially and adversely affect the rights and security of the holders of Bonds. SECTION 15. APPLICATION oF BOND PROCEEDS AND THE RETIREMENT OF OUTSTANDING BONDS. The City shall provide for the retirement of the Outstanding Bonds and for the application of the proceeds, including accrued interest, received from the sale of the Bonds, (hereinafter called "Bonds Proceeds"), as follows: A. Prior to the delivery of the Bonds, the City shall deliver to The Atlantic National Bank of West Palm Beach, West~Palm Beach, Florida, the Trustee appointed under the resolution authorizing the issuance of the Outstanding 1960 Bonds (hereinafter called the 1960 Trustee) and the Escrowee under the Escrow Deposit Agreement hereinafter provided for, a certificate or certificates setting forth, as of the date of delivery of the Bonds, (i) the principal amount of the Out- standing 1960 Bonds, the Outstanding Series A Bonds, and the Cutstanding Series B Bonds; (ii) the amount of the redemption premium applicable to the Outstanding 1960 Bonds to be redeemed on June l, 1971, the amount of the redemption premium applicable to the Outstanding Series A and Series B Bonds to be redeemed on June l, 1972; (iii) the amount of interest payable on the Outstanding 1960 Bonds to June l, 1971 and the amount of inter- est payable on the Outstanding Series A and Series B Bonds to June l, 1972; (iv) the amount of moneys on deposit to the credit of the Sinking Fund, the Principal and Interest Account, the Reserve Account, the Bond Redemption Account, and the Renewal and Replacement Fund, created pursuant to the resolu- tion authorizing the issuance of the Outstanding 1960 Bonds, as amended and supplemented by the resolution authorizing the 36 issuance of the Outstanding Series A Bonds; and (v) the amount of moneys on deposit to the credit of the 1961 Series B Sink- ing Fund, the Principal and Interest Account, the Reserve Account, the 1961 Series B Bond Redemption Account and the Renewal and Replacement Fund, created pursuant to the resolu- tion authorizing the issuance of such Outstanding Series B Bonds. B. The Bond Proceeds shall, when received by the City, be forthwith aPplied as follows: (1) The City shall transmit to the 196~ Trustee all accrued interest paid upon delivery of the Bonds for deposit into the Principal and Interest Account of the Sinking Fund, herein established, and such money shall be applied to the payment of interest on the Bonds. (2) The City shell transmit a portion of the Bond Proceeds (the amount of which is to be determined as herein- below provided) to the Escrowee, under the Escrow Deposit Agreement as hereinbelow provided, for a deposit into a trust fund~ hereby created and established, to be known as the "Out- standing Series A and Series B Bonds Retirement Fund" (herein- after called the "Series A and Series B Bonds Retirement Fund"). The amount of such portion of the Bond Proceeds so deposited with the Escrowee shall equal in the aggregate (i) the principal amount of the Outstanding Series A and Series B Bonds; (ii) the amount of the redemption premium applicable to the Outstanding Series A and Series B Bonds to be redeemed on June l, 1972; and (iii) the amount of interest payable on the Outstanding Series A and Series B Bonds to June l, 1972. Such moneys on deposit in the Series A and Series B Bonds Retirement Fund shall be irrevocable held in trust by the Escrowee for the purpose of providing for the retirement of the Outstanding Series A and Series B Bonds, pursuant to an Escrow Deposit Agreement to beo entered into between the City, the 1960 Trustee and the Escrowee. Such Agreement shall be in such form as shall be prescribed by a resolution of the City to be adopted prior to the delivery of the Bonds. 37 (3) Transmit to the 1960 Trustee for deposit into the Reserve Account created for the benefit of the Outstanding 1960 Bonds, the sum of $400,000.00. Such Reserve Account shall be continued and maintained with the 1960 Trustee until the retirement of the Outstanding 1960 Bonds and such Reserve Account shall hereafter be designated "Outstanding 1960 Bonds Retirement Account" (hereinafter called the "1960 Bonds Retire- ment Account"). Such sum of $400,000.00 and the sum of not less than $6~,000.00 presently on deposit therein shall, together with the net income or earnings which will be re- ceived from the investment and reinvestment of the moneys in the Series A and Series B Bonds Retirement Fund and the 1960 Bonds Retirement Account, at least equal in the aggregate (i) the principal amount of the Outstanding 1960 Bonds; (ii) the amount of the redemption premium applicable to the Outstanding 1960 Bonds to be redeemed on June l, 1971; and (iii) the amount of interest payable on the Outstanding 1960 Bonds to June l, 1971. The moneys or market value of the securities on deposit in the 1960 Bonds Retirement Account shall always be at least equal to the maximum amount required to be then on deposit in such 1960 Bonds Retirement Account pursuant to the provisions of the resolution authorizing the issuance of the Outstanding 1960 Bonds. Such moneys on deposit in the 1960 Bonds Retirement Account shall be irrevocably held in trust by the 1960 Trustee for the purpose of providing for the retirement of the Out- standing 1960 Bonds, pursuant to such Escrow Deposit Agreement, as hereinabove provided. (4) Transmit to the 19~0 Trustee for deposit into the Reserve Account created for the Outstanding 19~0 Bonds the sum of $148,000.00 to be applied by such 19~0 Trustee for the pay- ment, purchase or retirement of any or all of such Outstanding 19~0 Bonds. (~) The remaining balance of Bond Proceeds shall be deposited in the Construction Fund~ created and established 38 pursuant to Section 17 of this resolution. C. The Escrowee shall withdraw at such times from the Series A and Series B Bonds Retirement Fund and transmit to the Paying Agents of the Outstanding Series A and Series B Bonds the amounts necessary to provide for the retirement of such Outstanding Series A and Series B Bonds on or prior to June l, 1972. D. Such moneys on deposit in the Series A and Series B Bonds Retirement ~und shall be invested and reinvested by the Escrowee in direct obligations of the United States of America or in time deposits evidenced by certificates of deposits (sometimes referred to as "Letters of Deposit"), at the direc- tion of the City, msturing not later than the dates upon which such moneys will be needed for the retirement of the Outstand- ing Series A and Series B Bonds. All moneys on deposit in the Series A and Series B Bonds Retirement Fund, including time deposits, shall be continuously and fully secured with direct obligations of the United States of America having a market value (excluding accrued interest) of not less than the amount of such moneys and time deposits. All net income or earnings on such investments shall, when received on or prior to June l, 1971, be forthwith trans- mitted by the Escrowee to the 196© Trustee to be deposited into the 1960 Bonds Retirement Account and shall be held and applied for the same purposes ss the portion of the Bond Proceeds deposited therein pursuant to this resolution. Thereafter such net income or earnings shall be transmitted to the 196~ Trustee herein appointed, for deposit to the credit of the Reserve Account in the Sinking Fund. Eo The 1960 Trustee shall withdraw st such times from the 1960 Bonds Retirement Account and transmit to the Paying Agents of the Outstanding 1960 Bonds the amounts necessary to provide for the retirement of such Outstanding 1960 Bonds on or prior to June l, 1971. F. Such moneys on deposit in the 1960 Bonds Retirement Account shall be invested and reinvested by the 1960 Trustee in 39 direct obligations of the United States of America, at the direction of the City, maturing not later than the dates upon which such moneys will be needed for the retirement of the Outstanding 1960 Bonds. All net income or earnings received on such investments shall be retained by the 1960 Trustee in the 1960 Bonds Retirement Account and shall be held and applied for the same purposes as the portion of the Bond Proceeds originally deposited therein pursuant to this resolution. G. Prior to the delivery of the Bonds, the City shall transmit to the 1960 Trustee and the Escrowee a certified copy of a resolution of the City Council, (i) providing for the redemption on June l, 1971 of the Outstanding 1960 Bonds maturing subsequent to such date from moneys held in the 1960 Bonds Retirement Account and for the redemption on June l, 1972 of the Outstanding Series A and Series B Bonds maturing subse- quent to such date from moneys held in the Series A and Series B Bonds Retirement Fund, (ii) irrevocably instructing the Escrowee (a) to publish in a financial psper published in the City of New York, New York, promptly after the delivery of the Bonds, a notice, in the form set forth in such resolution, signed by the Escrowee in the name of the City, addressed to the holders of the Outstanding Series A and Series B Bonds and coupons appertaining thereto, stating that sufficient moneys have been deposited with the Escrowee for the retire- ment of the Outstanding Series A and Series B Bonds, that the pledge of and lien on the net revenues of the Water and Sewer System held by the Outstanding Series A and Series B Bonds has been discharged and released, and that the Outstanding Series A and Series B Bonds maturing on June l, 1973 and there- after will be called for redemption on June l, 1972 and (b) to call for redemption on June l, 1972, the Outstanding Series A and Series B Bonds maturing subsequent to such date, by publish- ing a notice of such redemption in the form set forth in such resolution, all in accordance with the provisions of the reso- lutions authorizing the issuance of such Outstanding Series A and Series B Bonds, and (iii) irrevocably instructing the 1960 ~0 Trustee to call for redemption on June l, 1971, the Outstand- ing 1960 Bonds maturing subsequent to sdgh~dat~, by publish- ing a notice of such redemption in the form set forth in such resolution, all in accordance with the provision~ of the reso- lution authorizing the issuance of such Outstanding 1960 Bonds. H. As soon as practicable after delivery of the Bonds, The Atlantic National Bank of West Palm Beach, the Trustee appointed under the resolutions authorizing the Outstanding Series A and Series B Bonds shall withdraw any funds in the Reserve Accounts for the Series A and Series B Bonds~ respec- tively, and transmit the same to the 196~ Trustee for deposit in the Construction Fund, hereinafter created and established. I. As soon as practicable after delivery of the Bonds, the 196© Trustee shall withdraw any funds in the Bond Redemp- tion Account created and established under the resolution authorizing the issuance of the Outstanding 1960 Bonds, shall deposit such moneys in the Renewal and Replacement Fund and shall apply the same to the initial annual deposit required pursuant to this resolution. J. After withdrawing from the Series A and Series B Bonds Retirement Fund and the 196© Bonds Retirement Account and transmitting to the respective paying agents such amounts which shall provide for the retirement of the Outstanding Bonds~ the 196© Trustee and the Escrowee shall withdraw from such respective Retirement Funds any excess moneys remaining therein and transmit the same to the Trustee, herein appointed. Such Trustee shall deposit the same to the credit of the Reserve Account in the Sinking Fund, herein established, if necessary~ otherwise to the Principal and Interest Account. K. The City shall from time to time pay to the 1960 Trustee, the Paying Agents, and the Escrowee, from funds of the City available for such purpose, the agreed amount of fees and expenses incurred or to be incurred by the 1960 Trustee, the Paying Agents and the Escrowee in connection with the retire- ment of the Outstanding Bonds. SECTION 16. RIGHTS OF HOLDERS OF OUTSTANDING REVENUE OBLIGATIONS. Nothing in this resolution shall be deemed to impair in any manner any of the security, rights or remedies of the holders of the Outstanding 19~0 Bonds, the Outstanding Contractors, Refunding Agreements and the Outstanding 1960 Bonds. All of the revenues pledged for the payment of such outstanding revenue obligations shall continue so pledged for the payment thereof to the full extent provided in the reso- lutions of the City authorizing their issuance. Whenever pro- vision has been made for the payment of the Outstanding 1950 Bonds, including all interest due or to become due thereon, and of the Outstanding Contractors' Refunding Agreements, and for the retirement of the Outstanding 1960 Bonds, the Bonds shall be secured forthwith equally and ratably by a pledge of and a prior lien on the net revenues of the Water and Sewer System. SECTION 17o CONSTRUCTION F~D. A special fund is hereby created, established, and designated as the "Sewer System Improvements Construction Fund" (herein called the "Construction Fund"), to be held by the Trustee, heretofore designated. There shall be paid into the Construction Fund the moneys so required by the provisions of Section Such fund shall be kept separate and apart from all other accounts of the City, and the moneys on deposit therein shall be withdrawn, used and applied by the City solely to the payment of the cost of the project and purposes incidental thereto, as described and set forth in Section ~ (A) of this resolution. If for any reason such proceeds or any part thereof are not necessary for or are not applied to the pay- ment of such cost, then the unapplied proceeds shall be deposited by the City in the Reserve Account. All such proceeds shall be and constitute trust funds for such purposes, and there is here~created a lien upon such moneys until so applied in favor of the holders of the Bonds. Any funds on deposit in the Construction Fund which, in the opinion of the City Council, acting upon the recom- mendation of the Consulting Engineers, are not immediately necessary for expenditure~ as hereinabove provided, may be ~2 invested in direct obligations of the United States of America maturing in a period of 91 days or less. All such securities shall be held by the depository bank, and all income derived therefrom shall be deposited in the Sinking Fund. Immediately prior to the delivery of the Bonds to the purchasers thereof, the City shall enter into a written agreement with the depository bank for said Construction Fund, which said agreement shall provide that all expendi- tures or disbuzsements from said Construction Fund shall be made only after such expenditures or disbursements shall have been approved in writing by the Consulting Engineer and the Mayor. The Date of completion of the project shall be determined by the Consulting Engineer, who will certify such facts in writing to the City Council. SECTION 18o MC~?iCATION OR ~ENDMENT. No material modification or amendment of this resolution or of any ordinance or resolution amendatory thereof or supplemental thereto, may be made without the consent in writing of the holders of two-thirds or more in principal amount of the Bonds then outstanding; providing, however, that no modifi- cation or amendment shall permit a change in the maturity of such Bonds or a reduction in the rate of interest thereon, or in the amount of the principal obligation or affecting the unconditional promise of the City to fix, maintain and collect rates, fees, rentals and other charges for said Water and Sewer System, or to pay the principal of and interest on the Bonds, as the same mature and become due, from the revenues of the Water and Sewer System, or reduce such percentage of holders of such Bonds required above for such modifications or amendments, without the consent of the holders of such Bonds. SECTION 19. SEVERABILITY OF INVALID PROVISIONS. If any one or more of the covenants, agreements or pro- visions of this resolution should be held contrary to any express provisions of h~ or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions, and shall in no way affect the validity of all the other provisions of this resolution or of the Bonds or coupons issued hereunder. SECTION 20. VALIDATION AUTHORIZED. Gene Moore, Esquire, City Attorney, be and he is h~reby authorized and directed to prepare and institute proceedings in the Circuit Court of the Fifteenth Judicial Circuit of Florida, in and for Palm Beach County, to validate and confirm the issuance of the Bonds authorized by this resolution and all proceed- ings and actions taken relating thereto. SECTION 21. ISSUANCE AND SALE OF BONDS° The Bonds shall be issued and sold in such manner and at such price or prices consistent with the terms of this resolution and the Act as the City Council shall hereafter determine° SECTION 22. EFFECTIVE DATE. This resolution shall take effect upon its passage in the manner provided by law. PASSED AND ADOPTED THIS 30th day of July, A.D. 1964. CI~F/~TONB~H, FLCRIDA Cit~ Cl~ Councilman Councilman C 6un c l lm'~-~a~n