458-Final Judgment-Lease Purch IN THE CIRCUIT COURT OF THE
EIGHTEENTH JUDICIAL CIRCUIT
IN AND FOR SEMINOLE COUNTY,
FLORIDA
CASE N0. 89-5055-CA
State of Florida
I'~~~ ~~FOR THE RELEASE OF EVIDENCE
, did hereby receive the below
exhibit(s) this ~ day of ~//~K~/ , 19 ~2.
/
EXHIBITS:
Plaintiff
1 proof of publication
3 certified copy of r~solution
Released to William Colbert, Esq., Attorney
Plaintiff-case pur~ed-5/1/92
MA.RYANNE MORSE
CLERK OF THE C~RCUIT
By: EVIDENCEC.~ '
CERTIFICATE
I, Janet R. Donahoe, City Clerk of the City of Sanford,
Florida, do hereby certify that the following is a true and
correct copy of Excerpt of Minutes of the Regular Meeting of the
City Commission of the City of Sanford, Florida, held on
September 25, 1989.
IN W~TNESS WHEREOF, I have hereunto set my hand and the
official seal. of the City of Sanford, Florida, this 26th day of
OctOber, 1989j
A~ the City Clerkof the
C~ty of Sanford, Florida
The next item of business was the cor~ideration of
lease-purchase borrowing. The City Manager recommended authoriz-
ation for the City Attorn'ey to proceed with the validation
process for the Certificates of Participation.
On motion of Commissioner Howell, seconded by Commis-
sioner Thomas and carried by vote of the Commission, as follows:
Mayor Smith Yea
Commissioner Eckstein Yea
Commissioner Howell Yea
Commissioner Thomas Yea
Commissioner McClanahan Yea
Resolution 1568 was adopted. Said Resolution being in words and
figures as follows:
Corporation, shall mean the President, Vice President and
Secretary/Treasurer.
"CERTIFICATE PURCHASE CONTRACT" shall mean the Certificate
Purchase Contract among the Finance Corporation, the Trustee and
the Underwriters.
"GROUND LEASE" shall mean the Ground Lease Agreement between
the City, as ground lessor, and the Finance Corporation, as ground
lessee.
"LEAST PURCHASE AGREEMENT" shall mean the Lease Purchase
Agreement between the Trustee, as Lessor, and the Finance Corpora-
tion, as Lessee.
"PROJECT" shall mean the Project described on Exhibit "A"
heretO.
"TRUST INDENTURE" shall mean the Trust Indenture between the
Trustee and the Finance Cdrporation.
"TRUSTEE" shall mean a bank or trust company authorized to
conduct trust business in the State of Florida, as trustee under
the Trust Indenture.
"UNDERWRITER" shall mean William R. Hough & CO., St.
Petersburg, Florida.
All other defined terms used herein shall have the meanings
set forth in the Definition Exhibit attached to the Lease Purchase
Agreement.
SECTION 3. FINDINGS. It is hereby ascertained, found,
determined and declared that:
(A) The City is authorized and empowered by the Act to enter
into transactions such as that contemplated by the Lease Purchase
Agreement, the Trust Indenture and the Ground Lease, and to fully
perform its obligations thereunder.
(B) The execution and delivery of the Lease Purchase Agree-
ment by the City and the Finance Corporation and the execution and
delivery of the Trust Indenture by the. Finance Corporation to
accomplish the lease purchase financing of the Project will comply
with all of the provisions of the Act.
(C) The City hereby acknowledges and approves the purpose
and activities of the Finance Corporation, including without
limitation, the execution and delivery by the Finance Corporation
of the Lease Purchase Agreement and will approve the membership,
officers, directors, articles of incorporation and by-laws by
subsequent proceedings of the City.
2
(D) The City is authorized and empowered by the Act to enter
into transactions such as that contemplated by the Ground Lease,
and to fully perform its obligations thereunder.
(E) The execution and delivery of the Ground Lease by the
City and the Finance Corporation will comply with all of the pro-
visions of the Act.
SECTION 4. AUTMORIZATION OF PROJECT. There is hereby autho-
rized the acquisition, construction and equipping of the Project
in accordance with the plans and specifications approved and ~o be
approved by the City, as and when so approved. The Costs of such
Project shall include all costs and expenses of every nature
incurred in the completion Of the Project.
SECTION 5. APPROVAL OF LEASE PURCHASE AGREEMENT. There is
hereby authorized to be executed and delivered a Lease Purchase
Agreement (in substantially the form annexed hereto as Exhibit
and incorporated herein by reference), which Lease Purchase Agree-
ment is hereby approve~ for the lease purchase of the Project.
The Lease Purchase Agreement shall be subject to such changes,
insertions or omissions as may be approved by an Authorized Offi-
cer of the City and the execution of the Lease Purchase Agreement
by an Authorized Officer of the City shall be conclusive evidence
of any such approval.
SECTION 6. TRUST INDENTURE AUTHORIZED. The Trust Indenture
(in substantially the form annexed hereto as Exhibit "C" and
incorporated herein by reference), and the execution and delivery
thereof by the Finance Corporation is hereby approved by the City.
The Trust Indenture shall be subject to such changes, insertions.
or omissions as may be approved by an Authorized Officer of the
City and the City Attorney and the execution of a Certificate
approving such changes, insertions or omissions to the Trust
indenture by an Authorized Officer shall be conclusive evidence of
any such approval.
SECTION 7. CONSENT TO ASSIGNMENT AND ATTORNMENT AGREEMENT
AUTHORIZED. A Consent to Assignment and Attornment Agreement (in
form and substance satisfactory to the City Attorney and the'
Authorized Officer executing such document) is hereby approved by
the City. The City is hereby authorized to enter into the Consent
to Assignment and Attornment Agreement and an Authorized Officer
of the City is hereby directed to execute such Consent to Assign-
ment and Attornment Agreement on behalf of the City in the manner
provided by law.
SECTION 8. COLLATERAL ASSIGNMENT OF CONSTRUCTION CONTRACTS,
WARRANTIES, PERMITS AND L~CMNSES, ETC., AUTHORIZED. A Collateral
Assignment of Construction Contracts, Warranties, Permits and
Licenses, Etc. (the "Collateral Assignment") (in form and sub-
stance satisfactory to the City Attorney and the Authorized
Officer executing ~uch document) is hereby approvcd by the City.
The City is hereby authorized to enter into the Collateral Assign-
ment and an Authorized Officer of the City is hereby directed to
execute such Collateral Assignment on behalf of the City in the
manner provided by law.
SECTION 9. GROUND LEASE, A Ground Lease {in form and sub-
stance satisfactory to the City Attorney and the Authorized Offi-
cer executing such document) is hereby appro~ed by the City. The
City is hereby authorized to enter into the Ground Lease and an
Authorized Officer of the City is hereby directed to execute,such
Ground Lease on behalf of the City in the manner provided by law.
SECTION 40. AUTEORIZATION FOR FINANCE CORPORATION TO ENTER
INTO GROUND LEASE. The Finance Corporation is hereby autho'rized
to enter into the Ground Lease and simultaneously assign the
leasehold estate thereunder to the Trustee for the benefit of the
Owners of the Certificates, as part of the lease purchase financ-
ing for the benefit of the City.
SECTION 11. ASSENTS, ACCEPTANCES, ASSIGNMENTS, FINANCING
STATEMENTS AND APPROVALS. The Authorized Officers of the City are
authorized to execute such assents, acceptances, assignments,
financing statements and approvals as the City and Special Counsel
may deem necessary for the City to finance the Project in the
manner contempl~ated by the Lease Purchase Agreement and the Trust
Indenture.
SECTION 12. SEVERABILITY OF INVALID PROVISIONS. If any one
or more of the covenants, agreements or provisions contained in
this Resolution, the Lease Purchase Agreement~ the Trust Inden-
ture, the Ground Lease or any other document or agreement hereby
authorized shall be held to be contrary to any express provision
of law or contrary to the policy of express law, though not
expressly prohibited, or against public policy, or shall for any
reason whatsoever be held invalid, then such covenants, agreements
or provisions shali be null and void and shall be deemed separable
from the remaining covenants, agreements or provisions and shall
in no way affect the validity of any of the other provisions
hereof or of the Lease Purchase Agreement, the Trust Indenture,
nhe Ground Lease or any other document or agreement hereby autho-
rized.
SECTION I3. VALIDATION AUTHORIZED. The City Attorney is
hereby authorized and directed to institute proceedings for the
judicial validation of the Lease PUrchase Agreement and the
authority of the City to enter into the transactions contemplated
by the Lease Purchase Agreement and hereby.
SECTION 14. REPEALING CLAUSE. All resolutions, Or parts
thereof, or other official actions of the City in conflict with
the provisions herein contained are, to the extent of such con-
flict, hereby =~c~ ~n~ ~.=~.~
4
SECTION 15. EFFECTIVE DATE. This Resolution
effect immediately upon adoption.
PASSED AND ADOPTED B~w,,~ THE CITY -. COMMISSION OF THE CITY OF
SANFORD, FLORIDA this~.9~g ~ day of ~/LZ/-, ~989.
ATTEST: M y
~,~
Corporation, shall mean the president, V~ce President and
.Secretary/TreasUrer.
"CERTIFICATE PURCHASE CONTRACT" shall mean the Certificate
Purchase Contract among the Finance Corporation, the Trustee and
the Underwriters.
"GROUND LEASE" shall mean the Ground Lease Agreement between
the City, as ground lessor, and the Finance Corporation, as ground
lessee.
"LEASE PURCHASE AGREEMENT" shall mean the Lease Purchase
Agreement between the Trustee, ae Lessor, and the Finance Corpora-
tion, as Lessee.
"PROJECT" shall mean the Project described on Exhibit "A"
hereto.
"TRUST INDENTURE" shall mean the Trust Indenture between the
Trustee and the Finance C~rporation.
"TRUSTEE" shal% mean a bank or trust company authorized to
conduct trust business in the State of FLorida, as trustee under
the Trust Indenture.
"UNDERWRITER" shall mean William R. Hough & CO., St.
Petersburg, Florida.
All other defined terms used herein shall have the meanings
set forth in the De£inition Exhibit attached to the Lease Purchase
Agreement.
SECTION 3. FINDINGS. It is hereby ascertained, ~ound,
determined and declared that:
(A) The City is authorized and empowered by the Act to enter
into transactions such as that contemplated by the Lease Purchase
Agreement, the Trust Indenture and the Ground Lease, and to fully
perform its Obligations thereunder.
(B) ~ane execution and delivery of the Lease Purchase Agree-
ment by the City and the Finance Corporation and the execution and
delivery of the Trust Indenture by the Finance Corporation to
accomplish the lease purchase financing of the Project will comply
with all of the provisions of the Act.
(C) The City hereby acknowledges and approve~ the purpose
and activities of the Finance Corporation, including without
limitation, the execution and delivery by the Finance Corporation
of the Lease Purchase Agreement and will approve the membership,
officers, directors, articles of incorporation and by~laws by
subsequent proceedings of the City.
2
(D) The City is authorized and empowered by the Act to enter
into transactions such as that contemplated by the Ground Lease,
and to fully perform its obligations thereunder.
(E) The execution and delivery of the Ground Lease by the
City and the Finance Corporation will comply with all of the pro-
visions of the Act.
SECTION 4. AUTHORIZATION OF PROJECT. There is hereby autho-
rized the acquisition, construction and equipping of the Project
in accordance with the plans and specifications approved and to be
approved by the City, as and when so approved. The Costs of such
Project shall include all costs and expenses of every nature
incurred in the completion of the Project.
SECTION 5. APPROVAL OF LEASE PURCHASE AGREEMENT. There is
hereby authorized to be executed and delivered a Lease Purchase
Agreement (in substantially the form annexed hereto as Exhibit
and incorporated herein by reference), which Lease Purchase Agree-
ment is hereby approve~ for the lease purchase of the Project.
The Lease Purchase Agreement shall be subject to such changes,
insertions or omissions as may be approved by an Authorized Offi-
cer of the City and the execution of the Lease Purchase Agreement
by an Authorized Officer of the City shall be conclusive evidence
of any such approval.'
SECTION 6. TRUST INDENTURE AUTHORIZED. The Trust Indenture
(in substantially the form annexed hereto as Exhibit "C" and
incorporated herein by reference), and the execution and delivery
thereof by the Finance Corporation is hereby approved by the City.
The Trust Indenture shall be subject to such changes, insertion~
or omissions as may be approved by an Authorized Officer of the
City and the City Attorney and the execution of a Certificate
approving such changes, insertions or omissions to the Trust
Indenture by an Authorized Officer shall be conclusive evidence of
any such approval.
SECTION 7. CONSENT TO ASSIGNMENT AND ATTORNMENT AGREEMENT
AUTHORIZED. A Consent to Assignment and Attornment Agreement (in
form and substance satisfactory to the City Attorney and the
Authorized Officer executing such document) is hereby approved by
the City. The City is hereby authorized to enter into the Consent
to Assignment and Attornment Agreement and an Authorized Officer
of the City is hereby directed to execute such Consent to Assign-
ment and Attornment Agreement on behalf of the City in the manner
provided by law.
SECTION 8. COLLATERAL ASSIGNMENT OF CONSTRUCTION CONTRACTS,
WARRANTIES, PERMITS AND LiCeNSES, ETC., AUTHORIZED. A Collateral
Assignment Of Construction Contracts, Warranties, Permits and
Licenses, Etc. (the "Collateral Assignment") (in form and sub-
stance satisfactory to the City Attorney and the Authorized
3
Officer executing such document) is hereby approved by the City.
The City is hereby authorized to enter into the Collateral Assign-
ment and an Authorized 0fficer of the City is hereby directed to
execute such Collateral Assignment on behalf of the City in the
manner provided by law.
SECTION 9. GROUND LEASE. A Ground Lease (in form and sub-
stance satisfactory to ~he city Attorney and the Authorized Offi-
cer executing such document) is hereby approved by the City. The
City is hereby authorized to enter into the Ground Lease and an
Authorized Officer of the City is hereby directed to execute°such
Ground Lease on behalf of the City in the manner provided by law.
SECTION 10. AUTHORIZATION FOR FINANCE CORPORATION TO ENTER
INTO GROUND LEASE. The Finance Corporation is hereby authorized
to enter into the Ground Lease and simultaneously assign the
leasehold estate thereunder to the Trustee for the benefit of the
Owners of the Certificates, as part of the lease purchase financ-
ing for the benefit of the City.
SECTION 11. ASSENTS, ACCEPTANCES, ASSIGNMENTS, FINANCING
STATEMENTS AND APPROVALS. The Authorized Officers of the City are
authorized to execute such assents, acceptances, assignmentst
financing statements and approvals as the City and Special Counsel
may deem necessary for the City to finance the Project in the
manner contempA~ted by the Lease Purchase Agreement and the Trust
Indenture.
SECTION 12. SEVERABILITY OF INVALID PROVISIONS. If any one
or more of the covenants, agreements or provisions contained in
this Resolution, the Lease Purchase Agreement, the Trust inden-
ture, the Ground Lease or any Other document or agreement hereby
authorized shall be held to be contrary to any express provision
of law or contrary to the policy of express law, though not
expressly prohibited, or against public policy, or shall for any
reason whatsoever be held invalid, then such covenants, agreements
or provisions shal! be null and void and shall be deemed separable
from the remaining covenants, agreements or provisions and shall
in no way affect the validity of any of the other provisions
hereof or of the Lease Purchase Agreement, the Trust Indenture,
=he Ground Lease or any other document or agreement hereby autho-
rized.
SECTION 13. VALIDATION AUTHORIZED. The City Attorney is
hereby authorized and directed to institute proceedings for the
judicial validation of the Lease Purchase Agreement and the
authority of =he City to enter into the transactions contemplated
by the Lease Purchase Agreement and hereby.
SECTION 14. REPEALING CLAUSE. All resolutions, or parts
thereof, or other official actions of the City in conflict with
the provisions herein contained are, to the extent of such con-
flict, her~bF ~u~e~eae~ ~n~ re~.-~.
4
SECTION 15. EFFECTIVe, DATE. This Resolution ~hall take
effect immediately upon adoption.
SANFORD, FLORIDA day 1989.
ATTEST: M~
£ity Clerk
CERTIFICATE
I; Janet R, Donahoe, City Clerk of the City of
Sanford, Florida, do hereby certify that the foregoing
is a true and correct copy of ResolutionNo. 1568
PASSED and ADOPTED by the City Commission of the City
of Sanford, Florida, on the 25th day of September,
1989.
IN WITNESS WHEREOF, I have hereunto set my hand
and the official seal of the City of Sanford, Florida,
this 26th day of October, 1989.
-. ~' ~'~ s~h~the~ity Clerk of the
City of Sanford, Florida
EXHIBIT "B"
FORM OF LEASE PURCHASE AGREEMENT
BM&O DRAFT
09/22/89
2100.3
LEASE AGREEMENT WITH OPTION TO PURCHASE
between
CITY OF SANFORD, FLORIDA
a municipal corporation and a
political subdivision of
the State of Florida
("Lessee")
and .
CITY OF SANFORD FINANCE CORPORATION,
a Florida not-for-profit corporation
("Lessor")
Dated as of 1, 1989
TABLE OF CONTENTS
RECITALS ................................................ 1
SECTION 1
RULES OF CONSTRUCTION
1.1. Definitions ................................... 3
1.2. Gender ........................................ 3
1.3. Singular and Plural ........................... 3
1.4. Reference ..................................... 3
1.5. Intended Relationship ......................... 3
SECTION 2
L EASE TERM; LEASE RENTAL
2.1. Lease Term .................................... 4
2.2. Termination ................................... 4
2.3. Basic Rent .................................... 4
2.3.1. Interest Rate ................................. 4
Overdue Rate .................................. 4
..... 'suppl ental Rent ............................. 5
2.5. Rent is Limited Obligation; No Abatement
of Set-Off .................................. 5
2.6. Non-Appropriation ............................. 6
2.6.1. Non-Renewal ................................... 6
2.6.2. Return of Project ............................. 7
2.7. Lessee's Funds ................................ 7
2.7.1. Rent Payment Fund ............................. 7
2.7.2. Reserve Fund .................................. 7
2.7.3. Capitalized Interest Account .................. 7
2.8. Definition of "Balance Due Lessor" ............ 8
SECTION 3
ACQUISITION; AUTHORIZATION FOR PAYMENT; TITLE
3.1. Acquisition of Project ........................ 9
3.2. Limitations on Acquisition .................... 10
3.3. Intentionally Deleted ......................... 10
3.4. No Material Change in Nature of Project ....... 10
3.5. Warranties; Disclaimers ....................... 10
3.6. Location ...................................... 11
3.7. Lessor Not Liable ............................. 11
SECTION 4
LESSEE'S REPRESENTATIONS AND WARRANTIES
4,1o Lesseers Representations and Warranties .......
4.1ol. Nature Of Project ............................. 12
· 2. ~" .... i~;~' P~'=, ~t~, ....................
i
SECTION 5
REPAIR, MAINTENANCE AND UPKEEP
SECTION 6
SUBLEASE OF PROJECT; SUBSTITUTION OF PERSONAL PROPERTY
6. I. Sublease .................................... 26 0
6.2. Substitution ~ Equi~z~nent ..................... 26
6.3. Fixtures ...................................... 26
6.4. Removal and Restoration by Lessee ............. 26
SECTION 7
USE; SUBROGATION; QUIET ENJOYMENT
7.1. Care and Use of Project ....................... 27
7.2. Mutual Waiver of Subrogation Rights ........... 27
7.3. Waiver ........................................ 27
7.4. Quiet Enjoyment ............................... 28
SECTION 8
'NET LEASE; MECHANICS' LIENS; OFF-SET STATEMENT
8.1. Net Lease ..................................... 29
8.2. Lessor's Interest Not Subject to Mechanics'
Liens ....................................... 2 9
8.3. Offset Statement .............................. 30
SECTION 9
INSURANCE
SECTION 10
CONSENT TO DISMISS
SECTION 11
EVENTS OF DEFAULT
SECTION 12
REMEDIES
12.1. Remedies for Default..~ ....................... 36
12,2. Disposition Of Project ........................ 37
iii
SECTION 13
SURRENDER OF PROJECT; HOLDING OVER
13.1. Surrender of Project .......................... 39
13.2. Holding Over .................................. 39
13.3. Limited to Non-Ad Valorem Revenues ............ 39
SECTION 14
NO WAIVER OF REMEDIES; LATE PAYMENTS; ACCORD AND SATISFACTION,
SECTION 15
RISK OF LOSS; STIPULATED LOSS VALUES
SECTION 16
CERTIFICATES; MANDATORY PREPAYMENT
16.1. Certificates .................................. 43
16.2. Mandatory Prepayment .......................... 43
16.3. 'Sinking Fund Rent Payments .................... 43
16.4. Authorization to Transfer Funds ............... 43
SECTION 17
PREPAYMENT OPTION; PURCHASE OPTION
17.1. Prepayment Option ............................. 44
17.2. Option to Purchase ............................ 44
SECTION 18
RECALCULATION OF BASIC RENT PAYMENTS
SECTION 19
DEFEASANCE
SECTION 20
SPECIAL PROVISIONS WITH RESPECT TO MBIA
[To Be Provided]
iv
SECTION 21
LESSOR'S INDEMNITY
SECTION 22
INTEGRATION; AMENDMENTS
SECTION 23
NOTICES; MEMORANDUM
23.1. Notices ....................................... 51
23.2° Memorandum .................................... 51
SECTION 24
MISCELLANEOUS
v
DEFINITION EXHIBIT
INDEX OF EXHIBITS
EXHIBIT A Form Of Requisition
EXHIBIT B Description of Project
EXHIBIT C Rent and Terms
EXHIBIT D Budget
EXHIBIT E Form of Memorandum of Lease and Notice of Option
for Recording
vi
This LEASE AGREEMENT WITH OPTION TO pURCHASE (this "Lease
Purchase Agreement") is made and entered into as of 1,
1989, between the City of Sanford Financ~ Corporation, a Florida
not-for-profit corporation, as lessor ("Lessor") and the City of
Sanford, Florida, a municipal corporation and a political subdivi-
sion of the State of Florida ("Lessee"). The term "Lessor" shall
include all successors and assigns in interest hereunder. All
capitalized terms used herein and not otherwise defined herein
shall have the meaning set forth therefor in the Definition
Exhibit attached hereto pursuant to Section 1. I hereof.
WI TN E S SETH:
WHEREAS, pursuant to Chapter 166, Florida Statutes[, and City
of Sanford Charter and any applicable ordinance], and the laws and
Constitution of the State, of Florida, the Lessee is authorized to
enter into a lease purchase agreement relating to the lease pur-
chase acquisition, construction and equipping of a fire station
and improvements thereto, along with other equipnent, fixtures and
furnishings; and
WHEREAS, the Lessor has been created for the purpose of
facilitating the financing of the Project; and
WHEREAS, in furtherance of its corporate purpose the Lessor
has acquired, constructed and equipped, or has undertaken to
acquire, construct and equip, the Project and has determined to
provide for the lease purchase thereof by this Lease Purchase
Agreement; and
WHEREAS, by the Resolution duly adopted by the Commission of
the Lessee, the Lessee has authorized, among other things, (i) .the
execution and delivery by Lessee of the Ground Lease which grants
and conveys to Lessor a posseSsory leasehold estate in a certain
parcel of land located in the City and described in Exhibit A to
the Ground Lease (the "Land"); (ii) the execution and delivery by
the Lessee of this Lease Purchase Agreement to provide for the
acquisition and financing through lease purchase of the land,
building, equipment and facilities to be located in the City as
more fully described in Exhibit B hereto and any other equif~nent
or components integral thereto pursuant to Section 3.4 hereof (all
defined below as the "Project" ); and (iii) the execution and
delivery by the Lessee of the Trust Indenture; and
WHEREAS, the Lessee desires to acquire through this Lease
Purchase Agreement that certain personal property constituting a
portion of the Project (the items of such personal property being
referred to as items of "Equi[~nent" ); and the portion of the
Project constituting the Land and the portion constituting the
non-severable improvements and fixtures (such non-severable
!m~,'~.~n~ ~n~, ~h~ fixtures beinc collectively referTed to as
all replacement parts, repairs, additions, attachments, acces-
sories and replacements for such items of Equil~nent or the
Building, are herein collectively referred to as the "Project."
Each item of Equipment, soft costs or labor and materials with
respect to the Building is to be described on one or more "Requi-
sitions" in the form of Exhibit A hereto; and
WHEREAS, all items leased hereunder must be components of the
Project; and
WHEREAS, pursuant to the Trust Indenture, the Lessor shall
enter into the Assignment, to assign by outright assignment and
not as security to the Trustee all of the Lessor's right, title
and interest herein and hereunder; and
WHEREAS, the Lessor, and the Trustee shall enter into the
Trust Indenture and it is the intention of the parties hereto that
the Trustee pursuant to the direction of the Lessee herein will
issue Certificates of Participation (NCertificates") evidencing an
undivided fractional interest in the Basic R~nt Payments to be
made by the Lessee under this Lease Purchase Agreement; and
WHEREAS, in and by this Lease Purchase Agreement, the Lessee
has agreed to comply with all requirement of Section 103 of the
Code, necessary to maintain the exclusion from gross income for
federal income tax purposes of the Interest Portions of the Basic
Rent under this Lease Purchase Agreement as received by the Owners
of the Certificates and with all requirements of the Resolution;
and
WHEREAS the Lessee has arranged for MBIA to issue a Municipal
Bond Insurance' Policy in consideration of the payment by the
Trustee of the fee payable in respect thereof, the satisfactiom of
the other conditions precedent to the issuance of such Municipal
Bond Insurance Policy and in reliance upon the terms and condi-
tions of the Trust Indenture; and
WHEREAS, the relationship between Lessor and the Lessee shall
be a continuing one and components of the Project may be added to
or deleted from this Lease Purchase Agreement from time to time in
accordance with the terms hereof:
Ng~, THEREFORE, in consideration of the premises and the
covenants and conditions hereinafter contained and for other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
2
1. RULES OF CONSTRUCTION.
1.1. Definitions. Unless the context otherwise specifically
requires or indicates to the contrary herein, the defined terms
used in this Lease PurChase Agreement shall have the respective
meanings set forth therefor herein or in the Definition Exhibit
attached hereto.
1.2. Gender. Use of the masculine, feminine or neuter
gender hereina"~'~'therein is for convenience of reference only and
each shall be deemed to mean and include the other genders
whenever and wherever appropriate.
inclu e t and .the plural includes the singular whenever
and wherever appropriate.
1.4. References. Reference to any Certificate Document or
any other document or agreement shall mean such documents or
agreement as s~ne may be amended, modified or supplemented from
time to time in accordance with the terms thereof.
1.5. Intended Relationship. The parties hereto explicitly
intend to create a relationship of landlord and tenant and not of
mortgagee and mortgagor.
2. LEASE TERM; LEASE RENTAL.
2.1. Lease Term. Effective as of '- the Lease Commencement
Date, Lessor hereby rents and leases to the Lessee and the Lessee
hereby rents and leases from Lessor the Project for the Initial
Lease Term. The Lease Term shall commence on the Lease Commence-
ment Date and terminate on the Lease Termination Date, unless this
Lease Purchase Agreement is earlier terminated pursuant to Section
2.2 hereof.
2.2. Termination. The Lease Term will terminate upon the
earliest to occur of the following events:
(a) an Event of Default by the Lessee and exercise by Lessor
of Lessor's election to terminate this Lease Purchase Agreement
pursuant to Section 12.1 hereof;
(b) the payment by the Lessee of all Rent to be paid by the
Lessee under this Lease Purchase Agreement for the Maximum Lease
Term including sufficient money to make payment or provision for
payment of the Certificates then Outstanding;
(c) 'the expiration of the Initial Lease Term or any Renewal
Lease Term and the non-renewal of this Lease Purchase Agreement
due to an Event of Non-Appropriation under Section 2.6.1 hereof;
Or
(d) the date that the payment of the Option Price for the
Project by the Lessee pursuant to exercise by the Lessee of the
Lessee's Option pursuant to Section 17.2 hereof is applied to the
prepayment of Certificates and payment of all amounts due and
owing hereunder.
2.3. Basic Rent. The Lessee ag rees to make, as rental
payments hereunder for the Project, the Basic Rent Payments, in
arrears, by wire transfer of immediately available funds on the
fifth day prior to each Basic Rent Payment Date as set forth in
Exhibit C hereto. The Lessee shall pay the Basic Rent Payments
hereunder to the Trustee, as Lessor, at its offices and the
Trustee shall apply same as provided in the Trust Indenture to
payment to the Owners of the Certificates.
2.3.1. Interest Rate. The interest rate applicable to
this L~ase Purchase Agreement is the interest rate set forth in
Exhibit C hereto.
2.3.2. Overdue Rate. During the time that any portion
of Basic Rent or other s~ns under this Lease Purchase Agreement is
not paid when due, the amount of such portion of Basic Rent shall
bear interest at the Overdue Rate and such Additional Interest
~h~ ~nstitute Supp!ementa] Rent hereunder payable to the Person
4
I!~r~lOg~..~ EHI ir, z.l~H ~G,~m~:;~
~o
HF~;:~)~Zb-IO~I~Of~ 0I~ ~ ~
~ ~0® 0
~OD~DD~ hOD U~ ~ ~
~ ~ ~ ~ 0
0 ~0~
mOO ~m~om .H~o o~c:~
believes that the Lessee' s Non-Ad Valorem Revenues in an amount
sufficient to pay all Rent for the Maximum Lease Term of this
Lease Purchase Agreement will be available. The Lessee hereby
covenants that its [Financial Officer] will make provision for
such payments in each annual proposed budget submitted to the
Commission of Lessee as a separately stated line item in such
proposed budget.
2.6. Non-Appropriation.
2.6.1. Non-Renewal. The Lessee is a duly constituted
municipal corporation and political subdivision of the State with
a Fiscal Year ending on June 30 of each calendar year. As
provided herein, this Lease Purchase Agreement is for the Initial
Lease Term ending at the termination of the Lessee's then current
Fiscal Year, which term shall be automatically renewed for all the
Renewal Lease Terms set forth; provided, however that such auto-
matic renewal shall not occur if the Commission does not, prior to
the last day of the then current Initial Lease Term or Renewal
Lease Term, approve a budget which appropriates sufficient funds
(without regard to any credits from earnings on the Funds) from
moneys legally available for such purpose in a line item speci-
fically identified to be used for purposes of this Lease Purchase
Agreement to continue making payments beyond the end of the then
current Initial Lease Term or Renewal Lease Term; provided,
further, that in the event the Lessee' s final budget for such
ensuing Fiscal Year is not enacted prior to the expiration of the
Fiscal Year, this Lease Purchase Agreement shall be deemed renewed
pending the enactment of such final budget; provided, further,
that if payments are due hereunder during such period, this Lease
Purchase Agreement shall be deemed so extended only if such
interim budget or extension of the prior budget makes available' to
the Lessee moneys which may be legally used to make the payments
due hereunder during such period. In the event that despite
compliance with all of the Lessee' s covenants hereunder, the
Commission does not approve a budget which appropriates prior to
the last day of the then current Initial Lease Term or the Renewal
Lease Term (or if such final budget has not been enacted by such
time, prior to the last day of any extension hereof pursuant to
the preceding sentence but, in all events, prior to the last day
upon which a final budget is required to have been adopted under
Applicable law), sufficient funds from moneys legally available
for the payment of the Rent (and identified in a line item to be
used for purposes of this Lease Purchase Agreement) to be paid
during any Renewal Lease Term (an "Event of Non-Appropriation"),
this Lease Purchase Agreement shall terminate on such last day and
the Lessee shall not be obligated to make payment of Rent accruing
or arising beyond such last day. Lessee shall deliver immediate
written notice to the Lessor, the Trustee and MBIA if (i) such a
line item is not included in the proposed budget or (ii) such a
Col~nisslon.
6
2.6.2. Return of Project. If this Lease Purchase
Agreenent is terminated pursuant to Section 2.6.1 hereof, the
Lessee agrees peacably and immediately to-surrender use, posses-
sion and control of the Project to Lessor pursuant to Section 13.1
hereof in the condition required under Section 7 hereof. Failure
to do so shall result in the Lessee being liable for holdover rent
in accordance with Section 13.2 hereof.
2.7. Lessee's Funds.
2.7.1. Rent Payment Fund. The Rent Payment Fund shall
be invested as provided in the Trust indenture at the direction of
the Lessee. Any amounts earned from such investment shall be
deposited into the Rent Payment Fund and credited against the
Basic Rent Payments due under this Lease Purchase Agreement. All
funds remaining in the Rent Payment Fund after termination of this
Lease Purchase Agreement pursuant to Section 2.2(b) or (d) hereof,
shall be paid to the Lessee.
2.7.2. Reserve Fund. The Lessee hereby authorizes the
Lessor (i) to create a Reserve Fund to be held by the Trustee
under the Trust Indenture, (ii) to deposit in the Reserve Fund a
portion of the Proceeds from the sale of the Certificates repre-
sented by the Principal Portion of the Basic Rent in an amount
equal to the Reserve Requirement, and (iii) to use the amounts in
the Reserve Fund to pay, among other things, any portion of the
Basic Rent not paid when due by the Lessee. The Trust Indenture
shall provide that the Trustee will invest the amounts in the
Reserve Fund as directed in writing by the Lessee and any income
receive (less any applicable Rebate ~mount) thereon shall, on the
date such payment is due, be credited against the Basic Rent pay-
able by the Lessee and used by the Trustee to make such Basic Rent
Payments. Amounts in the Reserve Fund not used as provided in
clause (iii) above shall be used, among other things, to make the
final Basic Rent Payment Or the Concluding Payment, as applicable.
In the event the amount on deposit in the Reserve Fund shall be
less than the Reserve Requirement because of use as provided in
clause (iii), investment loss, or other reason, the Lessee shall
pay to the Trustee as Supplemental Rent an amount equal to such
deficiency within ten (10) days of receipt of written notice of
such deficiency from the Trustee.
.2.7.3 Capitalized Interest Account. The Lessee hereby
authorizes the Lessor (i) to create a Capitalized Interest Account
in the Project Fund to be held by the Trustee under the Trust
Indenture, (ii) to deposit therein a portion of the Proceeds from
the sale of the Certificates represented by the Principal Portion
of the Basic Rent in an amount equal to the capitalized interest;
and (iii) to use the amounts in the Capitalized Interest Account
in the PrOject Fund to pay a portion of the Interest Portion of
the Basic Renthereunder. The Trust Indenture shall provide that
Account as directed in writing by the Lessee and any income
7
received (less any applicable Rebate Amount) thereon shall be used
by the Trustee to pay a portion of the Interest Portion of the
Basic Rent Payments in accordance with Exhibit A to the Trust
indenture.
2.8. Definition of "Balance Due Lessor". "Balance Due
Lessor" shall be calculated as of the date that the amount of
Basic Rent to be prepaid hereunder will be applied to pay Certifi-
cates, as follows:
(a) if the date with respect to which such calculation
is being made is a Basic Rent Payment Date, an amount equal to the
sum of (i) the Concluding Payment with respect to such Basic Rent
Payment Date plus (ii) the Basic Rent Payment due as of such date,
or
(b) if the date with respect to which such calculation
is being made is other than a Basic Rent Payment Date, an amount
equal to the sum of (i) the Concluding Payment with respect to the
immediately preceding scheduled Basic Rent Payment Date plus (ii)
interest accrued on such amount computed from such immediately
preceding scheduled Basic Rent Payment Date through the date of
calculation computed ~ diem on the basis of a year of 360 days
consisting of twelve ) months of thirty (30) days each; and
(c) in either case, plus an amount equal to any Supple-
mental Rent due, owing or accrued to any Person hereunder.
8
3. ACQUISITION; AUTHORIZATION FOR PAYMENT; TITLE.
3.1. AcqUisition of Project. The Lessor has agreed with
Lessee that Lessee shall contract for the acquisition of the
Project and Lessee has agreed to inspect and accept the work on
the Building and the EquiFment. The Lessee has entered, or will
enter, into the Development Agreement to acquire the Project and
has entered, or will enter, into the Acquisition Contract for
other components of the Project and the Lessee's rights thereunder
shall be assigned to the Trustee pursuant to the Collateral
Assignment to secure performance by the Lessee of its obligations
under this Lease Purchase Agreement. On the Issue Date, the
Proceeds of the Certificates shall be deposited into the Project
Fund with the Trustee in amounts certified by the Lessee as
sufficient (together with earnings thereon) to pay the acquisition
costs and construction cqsts of the Project in accordance with the
Budget and the Draw Schedule. Pursuant to the Trust Indenture,
(i) the Assignment has been recorded in the Public Records of the
City on the Issue Date and the Notice of Commencement is to be
filed for recording not sooner than , 1989 and (ii) no
disbursements are to be made under paragraph (c) of this Section
3.1 unless and until the Trustee has received the update of title
showing ~o liens and the other documents referred to in Section ....
6.02.2 of the Trust Indenture.
(a) With respect to items of Equipment, upon
receipt of Requisitions signed by the Lessee in the form of
Exhibit A hereto and of any other documents required by Section
6.01(b) of the Trust Indenture, the Trustee shall disburse moneys
from the Project Fund for payment of the Item Purchase Price
thereof with title to be made in the name of the Lessor free and
clear of all liens and encumbrances other than the Permitted
Encumbrances.
(b) With respect to the Land, fee simple title
thereto is vested in the City, free and clear of all liens and
encumbrances other than the Permitted Encumbrances, and a lease-
hold estate in the Land has been granted to the Lessor by the
City.
(c) With respect to soft costs (as identified in
the Budget or related to construction upon receipt of a Requisi-
tion in the form of Exhibit A hereto, and of any other documents
required by Section 6.02.1 of the Trust Indenture, the Trustee
shall disburse moneys from the Project Fund for payment of the
Costs thereof.
(d) The Lessee shall at all times keep title to the
Project and its interest hereunder free and clear of all liens and
encumbrances of every kind whatsoever, except the Permitted Encum-
]~ r~!c~q. '~Tr ~ T~ E~c~ AND EVERY PROJECT COMPONENT SHALL PASS
LESSOR UPON PAYMENT THEREFOR.
9
(e) Each Requisition shall identify the line item of
the Budget from which each portion of the payments thereby
directed is to be made. In the event that such Requisition indi-
cates that there is a cost overrun in a Budget line item or in the
Budget for the acquisition of the Project, no further disburse-
ments shall be made by the Trustee until the requirements of
Section 3.2 hereof have been satisfied.
(f) From and after the Issue Date, there shall be.no
changes made to the Project, the Budget or the Draw Schedule
except pursuant to Section 3.2 hereof.
3.2. Limitations on Acquisition. The amount of moneys
available under the Trust indenture to pay for the costs of acqui-
sition, construction and equipping of the Project is limited to an
aggregate dollar amount o.f not more than the Maximum Cost. If the
Lessee agrees to an increase in the cost with respect to a compo-
nent of the Project or there is a cost overrun as described in
Section 3.1. hereof, and in either case, the amount in the Project
Fund is not sufficient to pay same and complete the acquisition of
the Project, then as a condition precedent to such amendment,
either (a) the Lessee shall deposit to the credit of the Project
Fund 'the-additional funds necessary to reduce such deficiency to
zero (as certified to the Lessor and Trustee in writing by the
Authorized Representative of the Lessee) or (b) shall provide to
the Lessor and the Trustee an amended Budget showing no cost defi-
ciency and certified as accurate in writing by the Authorized
Representative of the Lessee.
3.3. Intentionally Deleted.
3.4. No Material Change in Nature of Project. The Project
may not be substituted or materially modified without the prior
written consent of MBIA; provided, howe'vet, that any request to
make such a modification must be accompanied by certifications and
proof, satisfactory to the Trustee, that all approvals required
under Applicable Law, if any, have been obtained; provided,
further, that the selection of items of Equipnent different than
or in addition to those identified in Exhibit B hereto shall not
be deemed a substitution or modification so long as same are to be
used as a part of the Project, subject to the provisions of
Section 3.2 hereof.
3.5. Warranties; Disclaimers. The Lessee, upon execution of
a Requisition for any component of the Project, thereby shall
represent, without further act, that it has (a) thoroughly
inspected such component of the Project described therein, and (b)
satisfied itself that such component of the Project is suitable
for its purposes. LESSOR, NOT BEING THE VENDOR OR DEVELOPER OR
CONTRACTOR OF THE PROJECT, THE VENDOR' S AGENT, THE DEVELOPER' S
.~.c~, T n~ T~E CeNTRACTOR' S AGENT, MAKES NO WARRANTY OR
~0
4. LESSEE'S REPRESENTATIONS AND WARRANTIES.
4 · 1 · Lessee's Representations and Warranties. The Lessee
represents and warrants as follows:
4.1.1. Nature Of Project. The Project consists of the
Land, the Building and the Equifzment to be used by the Lessee as a
fire station and further valid municipal purposes.
4.1.2. Organization, Powers, Etc. The Lessee i~ a
municipal corporation and a political subdivision of the State
created and duly existing under the Constitution and laws of the
State, with full power and authority (i) to execute, deliver and
perform its obligations under this Lease Purchase Agreement and
under the Certificate Documents to which it is a party, (ii) to
own its property, and (~ii) to carry on its activities as now
being conducted and as contemplated in the Offering Circular. The
Lessee has complied with all provisions of Applicable Law, includ-
ing without limitation the ACt, in all material matters related to
the transactions cont~nplated hereunder and under the Certificate
Documents. The Commission is the governing body of and acts on
behalf of the Lessee.
4.1.3. Authorization; Absence of Conflicts, Etc. The
Commission has taken all official action necessary to authorize
Lessee to execute, deliver and perform its obligations under this
Lease Purchase Agreement and each of the Certificate Documents to
which it is a party, in accordance with their respective terms.
The execution, delivery and performance of this Lease Purchase
Agreement and each of the Certificate Do cuments to which the
Lessee is a party in accordance with their respective terms (i)
have been duly authorized by all necessary action on the part of
the Commission, (ii) do not and will not conflict with, or result
in a violation of, any Applicable Law, (iii) do not and will not
require any consent or approval of any creditor of the Lessee or
other third party or in any material way conflict with, result in
a violation of, or constitute a default under any agreement or
instrument to which the Lessee is a party or by which it or any of
its property may be bound and (iv) do not and will not result in
or require the creation or imposition of any lien, charge or
encumbrance upon or with respect to any component of the Project.
4.1.4. Binding Ob!i~ation. This Lease Purchase Agree-
ment has been duly executed ano delivered on behalf of the Lessee
by an Authorized Representative of the Lessee and is, and each of
the Certificate Documents to which the Lessee is a party, when
executed and delivered by the other parties thereto will be, a
legal, valid and binding obligation of the Lessee enforceable
against the Lessee in accordance with its respective terms, except
to the extent, if any, that the enforceability thereof may be
~ i~.~a ~,,,l ~i~ the effect of any debt adjus~ent or other similar
government affecting the enforcement 6f landlord' s rights
12
generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law).
4.1.5. Governmental Approvals. All Governmental Appro-
vals necessary for the Lessee to enter into this Lease Purchase
Agreement, and to enter into each of the Certificate Documents to
which it is a party are in effect on the date hereof, and to
perform its obligations hereunder and thereunder, have b~en
obtained and remain in full force and effect and are subject to no
further administrative or judicial review, and no other Govern-
mental Approval is necessary for the due execution, delivery and
performance by the Lessee of this Lease Purchase Agreement and the
Certificate Documents to which it is a party.
4.1.6. Compliahce with Applicable Law. The Lessee is
in compliance in all material respects with all Applicable Law,
including all Governmental Approvals.
4.1.7. Financial Statements. The Lessee has furnished
to the Lessor copies of financial statements of the Lessee for the
three most recent Fiscal Years. Such financial statements present
fairly, in accordance with generally accepted accounting prin-
ciples and applicable regulations consistently applied throughout
the periods involved, the financial position of the Lessee at
their respective dates and the revenues and expenses and changes
in fund balances for the periods covered thereby. Since the date
of the last of such financial statements, no change in the finan-
cial condition of the Lessee has occurred that might or could have
a Materially Adverse Effect on the Lessee' s ability to perform its
obligations pursuant to this Lease Purchase Agreement or any of
the Certificate Documents to which it is a party.
4.1.8. Absence of Litigation. There is no action,
suit, proceeding, official ~nquiry or investigation, at law or in
equity, before or by any court, arbitrator, governmental or other
board, body or official, pending or, to the best knowledge of the
Lessee, threatened against or affecting the Lessee or the Commis-
sion, questioning the validity of any proceeding taken or to be
taken by the Commission in connection with the execution, delivery
and performance by the Lessee of the Certificate Documents to
which it is a party or this Lease Purchase Agreement or seeking to
prohibit, restrain or enjoin the execution, delivery or perform-
ance by the Lessee of any of the foregoing, nor, to the best know-
ledge of the Lessee, is there any basis therefor, wherein an
unfavorable decision, ruling or finding (i) would adversely affect
the validity or enforceability of, or the authority or ability of
the Lessee to perform its obligations under, the Certificate Docu-
ments to which it is a party or this Lease Purchase Agreement,
': ~' '.'~-.!]~ ~ave~elv affect the validity of the Act or any provi-
Lease Purchase Agreement or any of the CertizzcaLe DOCLhIlenLS
(iii) would adversely affect the exclusion of the Interest Portion
of Basic Rent hereunder represented by the Certificates from
13
inclusion in the gross income of an owner of a Certificate for
federal income tax purposes.
4.1.9. Accuracy and Completeness of Information. All
information, reports and other papers and data furnished by or on
behalf of the Lessee to the Lessor were, at the time the same were
so furnished, complete and correct in all material respects, to
the extent necessary to give the recipient a true and accurate
knowledge of the subject matter. No fact is known to the Lessee
that has had or in the reasonable judgment of the Lessee may in
the future have a Materially Adverse Effect On the Lessee which
has not been set forth in the financial stataments referred to in
Section 4.1.7. hereof, or in such information, reports or other
papors or data otherwise disclosed in writing to the Lessor by or
on behalf of the Lessee. No document furnished or other written
statement made to the Lessor by or on behalf of the Lessee in
connection with the negotiation, preparation or execution of this
Lease Purchase Agreement or the Certificate Documents to which the
Lessee is a party contains or will contain any untrue statement of
a fact material to the creditworthiness of the Lessee or omits or
will omit to state such a material fact necessary in order to make
the statements contained therein not misleading.
4.1.10. Disclosure. The information contained in the
Offering Circular with respect to the Lessee, including any exhi-
bits, appendices or attachments thereto relating to the Lessee, as
such Offering Circular may be amended or supplemented, is true and
correct and does not contain any untrue statement of a material
fact with respect to the Lessee necessary to make such statements,
in light of the circumstances under which thy were made, not
mislead ing.
4 ] 1.11. Absence of Defaults. The Lessee is not in
default in the performance, observance or fulfillment of any of
the obligations, covenants or conditions contained in any agree-
ment or instrument to which the Lessee is a party or by which the
Lessee or any of the Lessee's property is bound (including without
1 imitation this Lease Purchase Agreement) or any judgments,
decrees or orders, except for defaults that, singly or in the
aggregate, have not had and will not have a Materially Adverse
Effect on the Lessee's ability to perform its monetary obligations
pursuant to this Lease Purchase Agreement or any of the Certifi-
cate Documents to which it is a party.
4.1.12. IRS Listing. Neither the Commission nor the
Lessee has been notified of any listing or proposed listing by the
Internal Revenue Service to the effect that the Commission or the
Lessee is an issuer of obligations whose arbitrage certifications
may not be relied upon.
a . ~ . 13. Tax-Exempt Status. ExceDt as has been other-
any action or omitted to take any action, and knows of no action
14
taken or omitted to be taken by any other Person, which action, if
taken or omitted, would cause the Interest Portion of Basic Rent
hereunder represented by the Certificates or on any tax-exempt
bond or note of the Lessee currently issued and outstanding to be
included in the gross income of the owners of the Certificates for
federal income tax purposes.
4.1.14. Availability of Funds. The Lessee expects to
make appropriations in an amount sufficient to pay all Rent in
each Fiscal Year and has no reason to believe that it will not
appropriate in the budget for each Fiscal Year an amount suffi-
cient to pay all Rent to become due in such Fiscal Year. The
Lessee believes that funds will be available to pay all of its
financial obligations during the term of this Lease Purchase
Agreement and, subject to Section 2.6.1. hereof, the Financial
Officer of Lessee will do all things within the Financial
Officer's power to obtain, maintain and properly request and
pursue funds from which such obligations may be paid. The Lessee
has no current intent to build, lease, acquire, purchase or
utilize any facilities which would be a substitute for the
Project.
4.1.15. Project Essential. The Lessee has an immediate
need for and expects to make immediate use of the Project, which
need is not temporary or expected to diminish during the Maximum
Lease Term.
4.1.16. Foreseeable Need. There are no circumstances
presently known to the Lessee affecting the Lessee that could
reasonably be expected to alter its foreseeable need for the Pro-
ject or adversely affect its ability or willingness to budget
funds for the payment of sums due hereunder.
4.1.17. Sources.' The Lessee shall make payments of
Rent hereunder for ea"ia~'Fiscal Year only from sources of funds
which are legally available to make payments under this Lease
Purchase Agreement.
4.1.18. Competitive Procedures. Any procedures
regarding the negotiation of this Lease Purchase Agreement, the
award of the Development Agreement and any Vendor Contract, to the
extent required by law, have been or will be complied with by the
Lessee.
4.1.19. Useful Life. [The remaining useful life of
each component of the Project significantly exceeds the period
during which the portion of the Principal Portion of Basic Rent
under this Lease Purchase Agreement attributable to such component
is to be retired.]
~.~. Lessee's Affirmative Covenants.
4.2.7. Compliance with Agreements. The Lessee shall
observe and perform fully and faithfully all of its obligations
under this Lease Purchase Agreement and the Certificate Documents
to which it is party.
15
4.2.2. Compliance with Applicable Laws. The Lessee
shall comply in all material respects with any and all Applicable
Laws material to this Lease Purchase Agreement, and the Certifi-
cate Documents or to the operations, affairs, properties or condi-
tion (financial or otherwise) of the Lessee.
4,2.3. Lessee Obligations. Subject to Sections 2.5 and
2.6 hereof, the Lessee shall promptly pay all amounts payable, by
it hereunder according to the terms hereof and shall duly perform
each of its obligations under this Lease Purchase ~4reement and
the other Certificate Documents to which it is a party. All
payments due hereunder shall be made from current or other funds
authorized by law and appropriate for such purpose by the Lessee.
4.2.4. Reports and Statements. The Lessee shall furnish
to the Lessor within 180 days after the end of each Fiscal Year of
the Lessee, financial statements of the Lessee with respect to the
operations of the Lessee for such Fiscal Year, provided, further
the Lessee's annual financial statements audited by a firm of
independent certified public accountants selected by Lessee and
the final. report of such auditor shall also be furnished to the
Lessor and the Trustee upon receipt thereof by the Lessee.
4.2.5. Budget and Tax Law.
(a) The Commission shall cause the Financial Officer to
prepare and submit the budget recommendation in accordance with
the requirements of this Lease Purchase Agreement, and the
Commission will act on such recommendation, will hold public
hearings, will adopt tentative and final official budgets, all
pursuant to the requirements of Applicable Law as in effect from
time to time. The Lessee further covenants, that to the extent
any taxes or levies are or shall be imposed by the Lessee, in its
sole and absolute discretion, all actions taken for the levying of
such taxes shall be taken pursuant to the requirement of Applic-
able Law, and the Lessee will use its best efforts to cause the
property appraiser and tax collector of the City to take all
actions required by law in the collection of said taxes.
(b) The Lessee shall send copies of its interim and
final budgets (as proposed and adopted) to the Lessor. Copies of
proposed budgets shall be sent promptly following their submission
for consideration. Copies of actual budgets shall be sent
promptly following their adoption and copies of related corres-
pondence shall be sent to the Lessor and the Trustee promptly upon
receipt or mailing by the Lessee. Each budget shall identify the
expenditures representing payments hereunder and the source of the
appropriation for each such payment.
'- ~,~ r.~=~ sha!] im~..'~,~ , notify ~¼~ r_a,_ssor and
the Trustee of any c~ange in Lhe 5L~L~te$ Or CO:iS'CiL~LiUn Ci~ ll'!=
State, of which it is aware, enacted into law or introduced in the
]6
legislature or any pending litigation that would 'adversely effect
the ability of the Lessee to receive funds from the federal or
state governments or to make payments or'-perform its obligations
hereunder. The Lessee shall not introduce any legislation which
would adversely affect the ability of the Lessee to perform its
obligations hereunder.
4.2.6. Construction or Acquisition of Similar Facili-
ties. The Lessee shall submit to the Lessor a copy of .the
approval by the Commission of construction or acquisition of any
facilities similar to the Project together with a statement of the
Lessee as to the cost thereof and the source of payment therefor.
4.2.7. Balanced Budget. The Commission shall, as
required by current Applicable Law, maintain a balanced budget for
each Fiscal Year.
4.2.8. Maintenance of Books and Records. The Lessee
will maintain complete and accurate books and records pertaining
to this Lease Purchase Agreement and the Project and all receipts
and disbursements with respect thereto in accordance with
generally accepted accounting principles consistently applied and
any applicable regulations.
4.2.9. Notices. The Lessee will promptly furnish, or
cause to be furnishe,~the Lessor, (i) notice of the occurrence
of any default or Event of Lease Default hereunder or any default
or event of default under any Certificate Documents of which it is
aware, (ii) copies of any communications delivered to or received
by it under any of the Certificate Documents, unless, with respect
to communications received by it under any of the Certificate
Documents, the same are required to be furnished by the sender
thereof directly to the Lessor under the terms of such Certificate
Documents), or from any taxing authority or State department or
rating agency with respect to the' transactions contemplated
hereby, and (iii) further financial and other information with
respect to the Lessee or the Commission and their respective
affairs as the Lessor may reasonably request from time to time.
. 4.2.10. Maintenance of Approvals, Filings and Registra-
tion. The Lessee shall at all times maintain in effect, renew and
comply with all the terms and conditions of all consents,
1 iceuses, approv~fls and authorizations as may be necessary or
appropriate under any Applicable Law for its execution, delivery
and performance of this Lease Purchase Agreement and the other
Certificate Documents to which it is a party.
4.2.11. Visits and Inspections. The Lessee will permit
representatives of the Lessor, upon reasonable prior notice and
from time to time as often as may be reasonably requested, to (i)
,~i~it and ins.Dect the Project covered by this Lease Purchase
pertaining to the Project and make copies and extracts of such
17
books and records that relate to the Project And the Lessee' s
performance under this Lease Purchase Agreement, and (iii) discuss
the affairs, finances and accounts of the '-Lessee pertaining to the
Project with, and to be advised as to the same by, its officials,
all in connection with the ability of the Lessee to perform its
obligations hereunder.
4.2.12. Litigation Notice. The Lessee will notify the
Lessor in writing, promptly after the same shall have become knpwn
to the Lessee or any official of the Commission upon whom process
has been served, if any action, suit or proceeding at law or in
equity or by or before any goverr~nental instrt~nentality or other
agency that, if adversely determined, would materially impair the
ability of the Lessee to perform its obligations under the Certi-
ficate Documents or would Materially Adversely Effect the opera-
tions, property, assets or financial condition of the Lessee.
4.2.13. Further Assurances. The Lessee will, at any
and all times, insofar as it may be authorized so to do by law,
pass, make, do, execute, acknowledge and deliver every and all
such further acts, deeds, conveyances, assignments, recordings,
filings, transfers and assurances as may be necessary or desirable
to secure' the payment of the Certificates (including the interest
thereon) or payment of its obligations hereunder or under the
Certificate Documents, or intended so to be, or which the Lessee
may hereafter become bound to pledge or assign thereto.
4.2.14. Builder's Risk Insurance. The Lessee shall,
during the construction of the Building (or shall cause the Dovel-
oper to), obtain and maintain builder's risk insurance in form and
substance approved by Lessor, naming the Trustee as the loss
payee, including a standard subrogation clause, and a clause
requiring the insurer to give .the Trustee at least 30 days' prior
written notice before cancelling or amending the policy.
4.2.15. Construction. The Lessee shall diligently
commence acquisition, construction or equipping (or, if appli-
cable, cause the Developer to commence construction) of the Pro-
ject and diligently pursue acquisition, construction or equipping
to completion of the Project on or before the Estimated Completion
Date. At all times during the construction, the Lessee shall (or
shall cause the Contractor to) comply with all requirements
imposed by all governmental authorities having jurisdiction over
the construction and by all insurance underwriters providing
insurance for the Project. Upon the Trustee's request, the Lessee
will provide the Trustee with evidence of the Lessee's compliance
with the requirements of this paragraph.
4.2.16. Inspection of Construction. The Lessee shall
permit Lessor, and its representatives and agent to inspect all
~--~-~!~- ~o be used in the construction of the Project and cause
18
(including providing working copies of the Plans and Specifica-
tions together with all related supplen~ntary materials); pro-
vided, however, that the Trustee is not obliged to make any
inspections of the Project.
4.2.17. Correction of Defects. The Lessee shall
promptly correct or cause to be corrected any defect in the design
or construction of the Project or, if applicable, departure from
the Plans and Specifications. The Trustee's decision from time. to
time to make or allow disbursements shall not constitute a waiver
of their right to require the Lessee's full compliance with this
paragraph.
4.2.18. Additional Assurances (Construction). The
Lessee shall provide Lessor the following additional assurances:
(i) If requested, but only as and when available, all
certificates of final inspection, certificates, appraisals,
reports, endorsements, and agreements, the names of all per-
sons with whom the Lessee has contracted or intends to con-
tract in connection with the acquisition or construction of
the project, schedules of all statements for labor and mater-
ials for the construction of the Project together with copies
of all statements, copies of all Budget revisions concerning
the construction of the Project indicating the funds required
at any given time to complete the construction, and all other
documents required to be furnished to Lessor.
(ii) If applicable, during construction upon request of
Lessor and upon completion of construction, furnish an Archi-
tect's written opinion to the effect that the Project, as
constructed, complies with all restrictions recorded, or
otherwise and with all applicable goverr~mental laws, regula-
tions, rules, ordinances, orders and codes.
(iii) Furnish to Lessor an acquisition progress schedule
showing any revisions to the estimates of each draw of funds
as compared to the Draw Schedule and certified by an
Authorized Representative of Lessee.
(iv) Furnish copies of all tests or reports concerning
the condition of the Project, or any of the materials used in
the construction of the Project as Lessor may reasonably
require.
(v) Furnish when available, a certificate of occupancy
and all other similar certificates legally required to be
issued by any governmental agency in connection with the
construction or occupancy of the Project.
~ ~c ~ ..... T~r~t~en Construction. If the Lessee
Non-Appropriation has occurred, at the Trustee's option, the
19
Trustee, as lessor, may, but is not required to make, any or all
subsequent disbursements directly to the Developer or any Vendor.
The Lessee's execution of this Lease Put-chase ArJreement consti-
tutes an irrevocable authorization for the Trustee to make
disbursements directly to the Developer or any Vendor. The Lessee
agrees that all construction disbursements made to the Developer
or any Vendor shall constitute full performance of the Trustee's
obligations to the Lessee under this Lease Purchase Agreement,
regardless of the Developer's or the Vendor's disposition of ~he
funds. The Trustee's decision to make a construction disbursement
shall not constitute a waiver of any of the provisions of this
Lease Purchase Agreement. If the Lessee is in default under this
Lease Purchase ~reement and the Lessee is unable to cure its
default, the Trustee's decision to make a construction disburse-
ment shall not preclude the Trustee, as lessor, from declaring the
Lessee in default under this Lease Purchase Agreement by virtue
thereof.
4.3. Negative Covenants of Lessee.
4,3.1. Certificate Documents. The Lessee will not
directly or indirectly amend, supplement, terminate or waive, or
consent to any amendment, supplement, termination or waiver of,
any of the provisions of any Certificate Document or enter into or
consent to any new Certificate Documents (whether or not any such
Certificate Document expires in accordance with its terms), unless
the Lessor shall have previously approved in writing the form and
substance of such new Certificate Document or such amendment,
supplement, termination, waiver or consent.
4.3.2. Appointment of Successors. The Lessee shall
not, without the prior written consent of the Lessor, appoint or
consent to the appointment of a successor Trustee.
4.3.3. Existence. The Commission shall take no-action
to terminate its or the Lessee' s existence and shall promptly
notify the Lessor of any action taken by the executive, legisla-
tive or judicial branches of the State government to terminate the
existence of the Lessee or the Commission.
4.3.4. Liens. The Lessee will not without the prior
written ConSent of t'EhTLessor, create, ass~m~e, incur or permit to
exist or to be created, assuned or incurred or permitted to exist,
directly or indirectly, any lien on, or assign, transfer, lease,
sublease or otherwise grant any person any rights in the Project
or the Land or its interest therein or any of its rights under the
Trust Indenture.
4.3.5. No Waiver of Defaults. The Lessee shall not
waive any default under the terms of any Acquisition Contract,
~hall enforce all of the obligations of the Developer, Contractor
20
that will relieve any Developer, Contractor or Vendor of its
respective obligations to provide or construct the Project accord-
ing to the requirements of the Lessee and the Plans and Specifica-
tions without the prior written consent of MBIA.
4.4. Lessee ' s Additional Covenants, Representations and
Warranties. The Lessee represents and warrants that the execution
of a Requisition by the Lessee shall constitute an affirmation of
the completeness and accuracy of the following representations and
warranties as of the date of such execution:
(a) The Lessee has delivered to the Trustee a complete,
fully excuted copy of the Acquisition Contract, and the Acquisi-
tion Contract is presently in full force and effect according to
its terms; the Lessee is not in default under the Acquisition
Contract; and the Lessee has no knowledge of any violation of the
Acquisition Contract.
(b) There are no governmental or other actions or pro-
ceedings (except actions or proceedings that are fully covered by
insurance) pending or, to the Lessee's knowledge, threatened
affecting the Lessee or the Project, which, if adversely deter-
mined, wo~/ld substantially impair the Lessee's ability to perform
its obligations under this Lease Purchase Agreement.
(c) The Commission knows of no violation and has no
notice of a violation of any court order or of any law, regula-
tion, ordinance, rule, order, code or requirement of any govern-
mental authority having jurisdiction over all or any component of
the Project that may detrimentally affect the develo[~nent and
operation of the Project as planned.
(d) If applicable, the Plans and Specifications for and
the use of the Project will comply with all restrictions (recorded
or otherwise), and all governmental laws, regulations, ordinances,
rules, orders, standards and codes and with all hazard insurance
underwriters' standards, in each case, applicable to the Project
or the Land.
(e) All utility services necessary for the construction
of the Project and the operation of the Project have been extended
to or are available at the Project, including, but not limited to,
water, storm and sanitary sewer facilities, electricity, and tele-
phone service or the cost of doing so is included in the Budget.
(f) All Governmental Approvals required for the acquisi-
tion or construction of the Project, if any, have been or will be
obtained before the time required by law with respect to the
applicable stage of construction of the Project and the Lessee
shall deliver (or cause to be delivered) copies of all permits to
21
(g) The Project is not damaged as a result of any casu-
alty (or if so damaged, repairs are being effected by the Con-
tractor pursuant to the builder's risk insurance or by the Lessee
pursuant to Section 15(a) hereof).
{h) The rights of way for all roads necessary for the
proposed utilization of the Project have either been acquired by
the appropriate govermmental authority or dedicated to and
accepted by the appropriate governmental authority or the cost'of
acquiring same are included in the Budget. All such roads are
improved or, if not improved, all necessary steps have been taken
by the Lessee and the responsible governmental authority to assure
their completion before the date when access to the Project via
such roads will be necessary. All curb cuts and traffic signals
required in connection with the operation of the Project are com-
plete or are approved for construction by all necessary governmen-
tal authorities and the cost thereof is included in the Budget.
(i) All the documents required to be submitted with
respect to such Requisition have been submitted.
( j ) The representations and warranties of the Lessee
under Section 4.1 hereof are true and correct in all material
respects as if made on such date.
(k) All representations, warranties, covenants and
agreements made by the Lessee in connection with this Lease
Purchase Agreement may be relied upon by Lessor notwithstanding
any independent investigation or lack thereof made or not made on
behalf of Lessor or any Certificate Owner.
(1) Ail actions of the Lessee, the Commission and its
members concerning this Lease Purchase Agreement have been taken
in accordance with Chapter 119 and Section 286.011, Florida
Statutes.
4.5. Federal Tax Covenants.
4.5.1. General. The Lessee shall not take any action
or refrain from tak'IFg any action (nor shall it cause or, to the
best of its ability, allow any other party under its direction or
control to do so, which act or failure to act could !advers.ely
affec~ the exclusion from gross income for federal income tax
purposes of the Interest Portion of the Basic Rent Payments under
this Lease Purchase Agreenent as received by the Owners of the
Certificates. The Lessee will not allow any investment of the
proceeds of this Lease Purchase Agreement which would result in
the obligations under this Lease Purchase Agreement being
characterized as "arbitrage bonds" under Section 148 of the Code.
The Lessee shall take all action required under the Code, includ-
~ ~c the calcu]~.tion an~ D~e~t ~= any rebate necessary to
Serve Ll'le exclusion [fore gross incujl= for federal income nax pur-
poses of the interest portion of the Basic Rent Payments under
22
this Lease Purchase Agreement as received by the Owners of the
Certificates; provided, however, that the Lessee may delegate such
responsibility to a third party pursuant'-to Section 4.5.2 hereof
but upon failure of such Person to properly do so, the Lessee
shall be responsible for same.
4.5.2. Rebate Account.
(a) The Lessee shall comply with the provisions .of
Article VIII of the Trust Indenture and with any written instruc-
tions received from Special Counsel, with respect to the Rebate
Account and the deposit to and disbursements from such account.
(b) Moneys in the Rebate Account shall be deemed subject
to a lien in favor of the United States to the extent of all
amounts which must be pa~d to the United States in order to pre-
serve the exclusion from gross income for federal income tax pur-
poses of the Interest Portion of the Basic Rent Payments under
this Lease Purchase Agreement as received by the Owners of the
Certificates.
(c) Notwithstanding anything else herein contained, the
moneys in' the Rebate .Account created pursuant to Article VIII of
the Trust Indenture shall not be released upon any defeasance
under this Lease Purchase Agreement and such moneys shall be held
and applied pursuant to the terms of the Trust Indenture and any
written instructions received from Special Counsel.
(d) The Lessee shall be responsible hereunder for calcu-
lating all amounts to be deposited in the Rebate Account and all
amounts to be paid to the United States in accordance with the
provisions of Article VIII of the Trust Indenture and any written
instructions received from Special Counsel and preparing any docu-
ment required under Section 148 of the Code and any regulations
promulgated in regard thereto.
23
5. REPAIR, MAINTENANCE AND UPKEEP.
Lessee shall be responsible, at it so~le cost and expense, for
all repair and maintenance of the Project, both interior and
exterior and both structural and nonstructural, whether forseeable
or not forseeable. Lessee shall keep or cause to be kept the
foundations, roof and structural portions of the walls of the
Project in first-class order, repair and condition. Lessee shall
commence required repairs as soon as practicable. Lessee shall.at
all times keep the Project (including all entrances and vesti-
bules) and all partitions, window and window fr~nes and moldings,
glass, store fronts, doors, door openers, fixtures, equi~nent and
appurtenances thereof (including lighting, heating, electrical,
plumbing, ventilating and air conditioning fixtures and systems
and other mechanical equiAInent and appurtenances within the Pro-
ject and all parts of the Project, in good order, condition and
repair and clean, orderly, sanitary and safe, including but not
1 imited to doing such things as are necessary to cause the Project
to comply with applicable laws, ordinances, rules, regulations and
orders of governmental and public bodies and agencies, such as but
not limited to the Williams-Steiger Occupational Safety and Health
Act. If replacument of equipnent, fixtures and appurtenances
thereto is necessary, Lessee shall replace all same with new or
completely reconditioned equi[nent, fixtures and appurtenances,
and repair all damages done in or by such replacement. Further-
more, Lessee shall:
(a) maintain all heating, ventilation and air condition-
ing equipment in the Project in satisfactory operating condition
at all times during the Lease Term;
(b) furnish any necessary janitorial services and .all
necessary janitorial supplies during the Lease Term;
(c) be responsible for replacement of all bulbs, lamps,
tubes and starters used in the light fixtures for the purpose of
furnishing light;
(d) furnish any necessary pest control services for the
Project during the Lease Term, including without limitation, those
necessary to control or eradicate wood destroying organisms; and
(e) promptly pay all gas, water, sewage, power and elec-
tric light rates or charges which may become payable during the
Lease Term for the gas, water, sewage and electricity used by the
Lessee in the Project.
All obligations of the Lessee, under this Section 5 shall be
at the Lessee's sole cost and expense and Lessee shall take all
actions necessary to assure that no liens arise against the Pro-
ject as a result of Lessee's failure to pay for water, Sewer,
24
no event shall Lessor be responsible for the q~ality, quantity,
failure or interruption of any such utility services to the Pro-
ject. Lessee shall be responsible for ana required to deliver any
and all security deposits that may be required to provide utility
services to the Project.
If Lessee fails to perform any of its obligations under this
Section 5, Lessor, without notice, may (but shall not be obligated
to) perform Lessee's obligations or perform work resulting from
Lessee's acts, actions or omissions and the cost thereof shall be
immediately due and payable hereunder as Supplemental Rent.
25
6. SUBLEASE OF PROJECT; SUBSTITUTION OF PERSONAL PROPERTY.
6.1. Sublease. The Lessee shall not: ( i ) sublease the
Project or any part thereof, even though consistent with Section
4.2 of this Lease Purchase Agreement without the prior written
consent of Lessor, in Lessor's sole and absolute discretion, and
without an opinion of counsel from Special Counsel that such
sublease will not adversely affect the exclusion from gross income
for federal income tax purposes of the Interest Portion of the
Basic Rent Payments under this Lease Purchase Agreement as
received by Owners of the Certificates, or (ii) assign or transfer
any portion of this Lease Purchase Agreement or the Project or any
part thereof, or any interest therein, or (iii) permit the Project
to be used in any manner inconsistent with Section 4.2 hereof.
Notwithstanding any sublease permitted hereunder, the Lessee shall
not be thereby released f~om liability to make the Rent Payments.
6.2. Substitution of Equipment. The Lessee may substitute
other equipment owned by the Lessee for an item of Equi~nent pro-
vided such substituted equi~aent is for the same purpose and (i)
has the same or a greater remaining useful life, (ii) has a fair
market value equal to or greater than the item of Equi[~nent for
which it is substituted, (iii) constitutes a Project component,
(iv) such substituted equi~nent is free and clear of all liens and
encumbrances, except the Permitted Encumbrances and (v) in the
event the amount thereof exceeds $100,000 during any Fiscal Year,
such substitution has the prior written consent of the Lessor
which shall not be unreasonably withheld or unduly delayed.
6.3. Fixtures. All fixtures installed by Lessee in the
Building shall be new.
6.4. Removal and Restoration by Lessee. All alterations,
changes and additions and all improvements, including leasehold
improvements, made by Lessee or by Lessor in Lessee' s behalf,
shall become part of the Project and shall not be removed by
Lessee at or prior to the end of the Lease Term without Lessor's
prior written consent provided, however, that if Lessor requests
Lessee to remove same at the end of the Lease Term, Lessee shall
do so at its own cost and expense.
26
7. USE; SUBROGATION; QUIET ENJOYMENT.
7.1. Care and Use of Project. Th~ 'Lessee at its expense,
shall maintain the Project in first-class operating condition,
repair and appearance and in the condition when construction is
completed hereunder (ordinary wear and tear excepted) and shall
protect same from deterioration, other than normal wear and tear;
shall cause the Project to be used within its normal capacity,
without abuse and in a manner contemplated by the Developer,
Vendor or Contractor thereof and in compliance with the require-
ments of applicable laws, ordinances and regulations and the
requirements of any policy of insurance required under Section 9
hereof; and shall cause the Project to be operated b~/competent
persons only and shall obtain, at the Lessee' s expense, all
permits and licenses, if any, required by law for the operation of
the Project. The Lessee agrees that Lessor shall not be
responsible for latent or patent or other defects, wear and tear
or gradual deterioration or loss of service or use of the Project
or any part thereof or for damage from fire or other casualty.
Lessor hereby assigns to Lessee, to the extent assignable', all
warranties with respect to the Project and each of its components
made by each Developer, any Vendor, Contractor, materialmen or
supplier.' Lessor shall not be liable to the Lessee or anyone else
for any liability, injury, claim, loss, damage or expense of any
kind or nature caused directly or indirectly by the inadequacy of
the Project or any item supplied by Developr, any Vendor,
Contractor, materialmen or supplier or any other party, any
interruption of use or loss of service or usage or performance of
any Project component, any loss of business or other consequence
or damage, whether or not resulting directly or indirectly from
any of the foregoing.
7.2. Mutual Waiver of Subrogation Ri hts. Lessor and Lessee
and all parties claiming under them mutually release and discharge
each other from all claims and liabilities arising from or caused
by any casualty or hazard covered or required hereunder to be
covered in whole or in part by insurance on the Project or in
connection with property on or activities conducted on the Pro-
ject, and waive any right of subrogation which might otherwise
exist in or accrue to any person on account thereof and evidence
such waiver by endorsement to the required insurance policies,
provided that such release and waiver shall not operate in any
case where the effect is to invalidate such insurance. coverage.
7.3. Waiver. Lessor, its agents and employees, shall not be
liable for, a~Lessee waives all claims for, damage, including
but not limited to consequential damages, to person, property or
other wise, sustained by Lessee, or any person claiming through
Lessee resulting from any accident or occurrence in or upon any
part of the Project including, but not limited to, claims for
~.~c~ ~e~'.~i~c =~.- (~1 any equi.~nent or a~Durtenances
oecoming odL oL :ep=i:; ~D) Lessee' s
27
the Project in repair; (c) injury done or caused' by wind, water,
or other natural element; (d) any defect in or failure of
plumbing, heating or air conditioning eq~i~nent, electric wiring
or installation thereof, gas, water, and steam pipes, stairs,
porches, railings or walks; (e) broken glass; (f) the backing up
of any sewer pipe or downspout; (g) the bursting, leaking or
running of any tank, tub, washstand, water closet, wastepipe,
drain or any other pipe or tank upon or about the Project; (h) the
escape of steam or hot water; (i) water, snow or ice upon the
Project; (j) the falling of any fixture, plaster or stucco; (k)
damage to or loss by theft or otherwise of property of Lessee or
others; (1) acts or omissions of persons in the Project, other
tenants in the Project, occupants of nearby properties, or any
other persons; and (m) any act or omission of owners of adjacent
or contiguous property, or of Lessor, its agents or employees.
All property of Lessee, kept in the Project shall be so kept at
Lessee' s risk only and Lessee shall save Lessor harmless from
claims arising out of damage to the same, including subrogation
claims by Lessee's insurance carrier.
7.4. Quiet Enjoyment. The Lessor covenants and agrees with
the Lessee that so long as the Lessee keeps and parforms all of
the coven-ants and coDditions by the Lessee to be kept and
performed hereunder, the Lessee shall have quiet and undisturbed
and continued possession of the Project, free from any claims
against the Lessor and all persons claiming under, by or through
the Lessor.
28
8. NET LEASE; MECHANICS' LIENS; OFF-SET STATEMENT.
8.1. Net Lease. The Lessee and Le~eor intend the Rent Pay-
ments hereunder to be net to the Lessor. The Lessee shall comply
with all liabilities and pay from Lessee's legally available Non-
Ad Valorem Revenues all required local, state and federal taxes,
including without limitation, income, franchise, gross receipts,
sales, use, documentary stamp, excise, and personal property
taxes, assesaments, licenses, registration fees, freight ~nd
transportation charges, Real Estate Taxes and any other charges
imposed or liabilities incurred with respect to the ownership,
possession or use of the Project, payment of Basic Rent or Supple-
mental Rent Or any other payments by the Lessee hereunder, and any
penalties, fines or interest imposed on any of the foregoing,
during the Lease Term; and the Lessee will pay all reasonable
expenses incurred by Lessor in connection with all filings or
recordings of any documents relating to this Lease Purchase Agree-
ment or Lessor's Lease Rights hereunder. The Lessee may in good
faith and by appropriate proceedings (but only (i) after posting
security satisfactory to Lessor and MBIA and (ii) if such contest
does not jeopardize Lessor's title to the Project) contest any
such taxes or charges with due diligence so long as such proceed-
ings, in' the reasonable opinion of Lessor, do not impair the
Lessee's ability or obligations to pay the Rent Payments here-
under. Lessor shall have the right, after reasonable written
notice to the Lessee, to make any of the payments required of the
Lessee under this Section 8 with respect to the Project, but shall
not be obligated to pay the same, and may charge such payment with
interest to the highest rate permitted by applicable law, not to
exceed the Maximum Rate, from the date of payment, as Supplemental
Rent to be paid by the Lessee on the next Basic Rent Payment
Date.
8.2. Lessor's Interest NOt Subject to Mechanics' Liens. All
persons to whom these presents may come are put on notice of the
fact that Lessee shall never, under any circumstances, have the
power to subject the interest of Lessor in the Project to any
mechanic's or materialman's lien or liens of any kind.
Lessee covenants and agrees with Lessor that Lessee will not
permit or suffer to be filed or claimed against the interests of
Lessor in the Project during the Lease Term any lien or claim of
any kind and, if such lien be claimed or filed, it shall be the
duty of Lessee, within thirty (30) days after Lessee shall have
been given written notice of such claim being filed in the Public
Records of Seminole County, Florida, to cause the Project to be
released from such claim, either by payment or by posting of a
bond or by the payment into the court of competent jurisdiction
the amount necessary to relieve and release the Project from such
claim or in any other manner which, as a matter of law, will
re~:]t within ~.~ch period of thirty (30) days in releasing the
29
8.3. Offset Statement. Within ten (10) days after written
request by either Lessor or Lessee the other party shall deliver,
executed in recordable form, declaration ~o any person designated
by the requesting party (a) ratifying this Lease Purchase Agree-
ment; (b) stating the commencement and termination dates; and (c)
certifying (i) that this Lease Purchase Agreement is in full force
and effect and has not been assigned, modified, supplemented or
amended (except by such writings as shall be stated), (ii) that
all conditions under this Lease Purchase Agreement to be performed
by the other party have been satisfied (stating exceptions, if
any) , to the extent known, (iii) that no defenses or offsets
against the enforcement of this Lease Purchase Agreement by the
requesting party exist (or stating those claimed) , (iv) as to
advance Rent, if any, paid by Lessee, (v) the date to which Rent
has been paid, and such other information as the requesting party
reasonably requires. Persons receiving such statements shall be
entitled to rely upon the~.
30
9. INSURANCE.
At its own expense the Lessee shall cause insurance against
the following risks in the following 'respective amounts to be
carried and maintained with respect to the Project during the
Lease Term. Throughout the Lease Term the Lessee shall annually
furnish to the Lessor a certificate evidencing such coverage.
(a) Insurance against the theft or destruction of, or
damage to, each component of the Project and extended coverage
insurance on each component of the Project, in an amount equal to
the greater of (i) the replacement value thereof or (ii) the then
applicable Stipulated Loss Value of each component of the Project;
provided that the extended coverage endorsement described in this
subparagraph (a) shall, as nearly as practicable, cover loss or
damage by explosion, windstorm, riot, aircraft, vehicle damage,
smoke, vandalism, maliuious mischief, rain, hurricane, theft and
such other hazards as are normally covered by such an endorsement,
and, if the Project or a component thereof is listed in a flood
hazard area, flood insurance to the extent available under a
federally subsidized program;
(b) Workers' compensation insurance covering all
employees working on, in, near or about each component of the
Project, in the same amount and type (including self-insurance) as
other workers' compensation insurance maintained by the Lessee for
similar employees doing similar work, but not less than the amount
required by law. The Lessee shall also require any other person
or entity working on, in, near or about each component of the
Project to carry the foregoing amount of workers' compensation
insurance; and
(c) The insurance described in paragraphs (a) and (b) of
this Section 9 shall be placed with nationally recognized and
reputable insurers or shall be maintained under actuarially sound
self-insurance programs or any combination thereof;
provided that, notwithstanding anything in this Section 9 to the
contrary, the Lessee shall have the right, without giving rise to
an Event of Lease Default hereunder, to maintain insurance cover-
age below that required by Section 9(a) if the Lessee furnishes to
the Lessor a certificate of an independent consultant to the
effect that the insurance so provided accords the greatest amount
of coverage available for the risk being insured against at rates
which in the judgment of the consultant are reasonable in connec-
tion with reasonable and appropriate risk management. In such
case, the uninsured portion of the risk shall be self-insured by
the Lessee.
Any insurance policy issued pursuant to this Section 9 shall
be so written or endorsed as to make losses, if any, payable to
appea~.
31
The Net Proceeds of any casualty, whether- from insurance or
self-insurance, shall be applied pursuant to Section 15 hereof.
Lessor shall have the right, witRout notice to Lessee, to
purchase any insurance required hereunder and not provided by
Lessee and the cost thereof shall be immediately due and payable
to Lessor as Supplemental Rent hereunder.
32
10. CONSENT TO DISMISS.
The Lessee acknowledges that Lessor'~is a third party lease
purchase financing source with respect to the Project and Lessee
hereby agrees to consent to (and to refrain from objection to), a
motion made by Lessor to be di~nissed from any lawsuit brought by
a third party arising out or in any way relating to this Lease
Purchase Agreement with respect to the Project or the ownership,
rental, possession, operation, condition, sale or return of any
Project. This covenant by the Lessee to consent to and refrain
from objection to such a motion to dismiss shall include Lessor's
assigns and their respective agents, employees, officers and
directors. It is understood by and between Lessor and Lessee that
this covenant is not intended to be and is not an indemnity.
33
11. EVENTS OF DEFAULT.
$
In the event that: '-
(a) Lessee shall default in the payment of any Rent or
in making any other payment hereunder, or
(b) (i) the Lessee shall breach the provisions of Sec-
tion 6 hereof with respect to subleasing, (ii) the Lessee fails, to
provide insurance as and when required hereunder, or (iii) the
Lessee shall default in the performance of any other covenant of
the Lessee hereunder, and except with respect to clause (i) or
(ii) immediately above and the requirements of Lessee to submit
budgets or request appropriations, the breach is not cured within
thirty (30) days, or (iv) any representation or warranty made by
Lessee hereunder proves to have been materially false at the time
it was made, or
(c) the Lessee fails to immediately surrender the Pro-
ject to Lessor after Lessee is requested to do so by Lessor
following an Event of LeaSe Default or the occurrence of an Event
of Non-Appropriation, as required by Section 2.6.2 hereof, or
(d) (i) the Lessee shall (A) commence a voluntary case
under the Federal bankruptcy laws (as now or hereafter in effect),
(B) file a petition asking to take advantage of any other laws,
domestic or foreign, relating to bankruptcy, insolvency, reorgani-
zation, debt adjustment, winding up or composition or adjustment
of debts, (C) consent to or fail to contest in a timely and appro-
priate manner any petition filed against it in an involuntary case
under such bankruptcy laws or other laws, (D) apply for or consent
to, or fail tO contest in a timely and appropriate manner, .the
appointment of, or the taking of possession by, a receiver, custo-
dian, trustee or liquidator of itself or of a substantial part of
its property, (E) admit in writing its inability to pay, or gener-
ally not be paying, its debts as they become due (within the
meaning of such bankruptcy laws), (F) make a general assignment
for the benefit of creditors, or (G) take any official action for
the purpose of effecting any of the foregoing; or (ii) commence a
case or other proceeding against the Lessee in any court of
competent jurisdiction seeking (A) relief under the Federal
bankruptcy laws (as now or hereafter in effect) or under any other
laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition or adjustment of debts,
or (B) the appointment of a trustee, receiver, custodian,
l iquidator or the like of the Lessee, or of all or a substantial
part of its property, and such case or proceeding shall continue
undismissed or unstayed for a period of 60 consecutive calendar
days, or an order granting the relief requested in any such case
or proceeding against the Lessee (including, but not limited to,
~n ~r~ ~r .~e]~e~ under such Federal bankruptc~v laws) shall be
34
"Event of Lease Default" hereunder; provided, h6wever, that with
respect to a default arising under clause (b)(iii) of this section
11, same shall not constitute an Event of'-Lease Default so long as
the Lessee is pursuing the cure of same with due diligence and by
appropriate means; provided, further, that this exception shall
not apply to covenants to submit budgets or request appropria-
tions.
35
12. REMEDIES.
12.1. Remedies for Default. Upon the occurrence of an Event
of Lease Default, and as long as such Event of Lease Default is
continuing, Lessor or its assigns may, at its option if there is
no Municipal Bond Insurance Policy in effect and at the direction
of MBIA if such a policy is in effect, exercise any one or more of
the following remedies or any other remedy available pursuant to
law or in equity or granted pursuant to this Lease Purchase Agr,ee-
ment, including without limitation, the following remedies:
(a) Without terminating this Lease Purchase Agreement,
re-enter and take possession of the Project and exclude Lessee
from using same until the Event of Lease Default is cured; or
(b) Without terminating this Lease Purchase Agreement,
re-enter and take possession of the Project, and remove all or any
portion of the Equil~nent from the land and sell, lease or sublease
such EquiFment for the account of Lessee, increasing the rent
payable hereunder during such Fiscal Year of Lessee for the
difference between (i) the purchase price, rent and other amounts
paid by the purchaser, lessee or sublessee pursuant to such sale,
lease or' sublease and (ii) the Basic Rent Payments and other
amounts payable by Lessee with respect to such component under and
pursuant to this Lease Purchase Agreement; or
(c) Terminate this Lease Purchase Agreement and acceler-
ate all the Rent Payments remaining due under this Lease Purchase
Agreement during the then current Fiscal Year, whereupon all the
Principal Portion of Basic Rent for such Fiscal Year shall become
immediately due and payable, together with interest accrued there-
on to the date of payment and all other payments due under this
Lease Purchase Agreement shall become immediately due and payable;
and Lessor or its assigns shall have the right to seek a judgment
against Lessee for such amounts, which shall be enforceable solely
against the Lessee's Non-Ad Valorem Revenues during the validity
of such judgment; or
(d) Terminate this Lease Purchase Agreement and require
Lessee to surrender and transfer possession of the Project to
Lessor in which event Lessee shall take all actions necessary to
authorize, execute and deliver to Lessor all documents necessary
to vest in Lessor, all of Lessee's interest in and to the Project,
and to discharge any lien created by or pursuant to this Lease
Purchase Agreement; and Lessee shall upon request by lassor,
remove any Equipment from Lessee's property to such location as is
specified by Lessor; or
(e) Terminate this Lease Purchase Agreement and without
notice or demand, enter into and upon the Project, or any part
thereof, and r~DOSS~SS the s~e and thereby restore the Lessor or
the Lessor or its assignee, to its former possessory estaLe as
36
owner and expel the Lessee and remove its effects forcefully, if
necessary, without being taken or deemed to be guilty of any
manner of trespass and thereupon this demise shall terminate and
upon such termination the Lessee shall have no further possessory
right whatsoever in the Project; and the Lessee shall be respons-
ible for the payment of damages in an amount equal to the Basic
Rent Payments which would have accrued hereunder, calculated on a
daily basis, for any period during which the Lessee fails to
surrender the Project or for any other loss suffered by the Lessor
as a result of the Lessee's failure to surrender the Project, ~11
without prejudice to any remedy which might otherwise be available
to the Lessor for arrears of Rent or for any breach of the
Lessee's covenants herein contained; or
(f) Take whatever action at law or in equity may appear
necessary or desirable to collect the Rent Payments then due and
thereafter to become due ~]uring the Lease Term or enforce perfor-
mance and observance of any obligation, agreement or covenant of
Lessee under this Lease Purchase Agreement.
Lessor's damages hereunder shall include the cost of enforce-
ment hereof and the collection of any judgment, including reason-
_. able attorneys! fees and court costs.
12.2. Disposition of Project.
(a) Except as provided in the next sentence, moneys
received by Lessor or its assignee from any re-letting and/or sale
i n accordance with Section 12.1. hereof shall be the absolute
property of Lessor Or its assignee and Lessee shall have no right
thereto, nor shall Lessee be entitled to any credit in the event
of a deficiency in the Rent Payments received by Lessor or its
assignee for the Project. In the event that moneys received' by
Lessor or its assignee from s'uch re-letting and/or sale exceeds
all amounts payable hereunder (which, in case of an Event of Non-
Appropriation, shall include the amount necessary to pay or
prepay, as the case may be, all the Certificates Outstanding under
the Trust Indenture and unpaid Supplemental Rent due hereunder),
Lessor shall pay such surplus to the Lessee. Neither notice of
sale or notice to pay rent or to deliver up possession of the
Project given pursuant to law nor any proceeding in unlawful
detainer taken by Lessor or its assignee shall of itself operate
to terminate this Lease Purchase ~3reement, and no termination of
this Lease Purchase Agreement on account of an Event of Lease
Default by Lessee shall be or become effective by operation of
law, or otherwise, unless and until Lessor or its assignee shall
have given written notice to Lessee of the election on the part of
Lessor or its assignee to terminate this Lease Purchase Agreement
as a result of such Event of Lease Default.
(b~ Lessee hereby irrevocably appoints Lessor Or its
and sell or re-let the Project upon the happening o5 and Event of
37
Lease Default. Lessee hereby exempts and agrees 'to save harmless
Lessor and its assignee (but solely from Lessee's legally avail-
able Non-Ad Valorem Revenues) from any cos'ts, loss or damage what-
soever arising or occasioned by any such entry upon and the sale
or letting of the Project during the balance of the Fiscal Year in
which the Event of Lease Default occurs and during any period of
hold-over tenancy and same shall constitute Supplemental Rent
hereunder. Lessee hereby waives any and all claims for damages
caused, or which may be caused, by Lessor or its assignee .in
taking possession of the Project, for all claims for damages that
may result from the destruction of or injury to the Project, and
all claims for damages to or loss of any property belonging to
Lessee that may be in or upon the Project. Lessee agrees that the
terms of this Lease Purchase Agreement constitute full and suffi-
cient notice of the right of Lessor or its assignee to enter and
sell or re-let the Project..
38
13. SURRENDER OF PROJECT; HOLDING OVER.
t 3.1. Surrender of Project. Upon 'the termination of this
Lease Purchase Agreement for any reason (including, without
1 imitation, under Section 2.6.1 hereof or an Event of Lease
Default) other than pursuant to Section 2.2(b) or (d) hereof, the
Lessee shall surrender the Project to Lessor in the condition
required pursuant to Section 7.1 hereof and shall deliver all keys
for, and all combinations on locks, safes and vaults in, the Pro-
ject to Lessor at Lessor's address for notices. If Lessee fails
to remove any shelving, decorations, equi~nent or trade fixture or
other personal property from the Project prior to the end of the
Lease Term, same shall become Lessor's property and Lessee shall
pay the cost to Lessor of removing same and shall repair or pay
for the repair of any damage done to the Project in removing
same.
13.2. Holding Over. If Lessee holds over or occupies the
Project beyond the Lease Term (it being agreed there shall be no
such holding over or occupancy without Lessor' s prior written
consent), Lessee shall pay Lessor for each day of such holding
over a sum equal to twice the semi-annual Basic Rent prorated for
........... the_.numbe~ of_d.~l~s of such~.holding over, plus a prorata portion of
all other amounts which Lessee would have been required to pay
hereunder had this Lease Purchase Agreement been in effect. If
Lessee holds over with or without Lessor's prior written consent
Lessee shall occupy the Project on a tenancy from month to month
and all other terms and provisions of this Lease Purchase Agree-
ment shall be applicable to such period.
13.3. Limited to Non-Ad Valorem Revenues. Notwithstanding
anything to the contrary contained herein, any obligations for
Rent hereunder during any hold over period shall be solely from
legally available Non-Ad Valorem Revenues of Lessee.
39
14. NO WAIVER OF REMEDIES; LATE PAYMENTS; ACCORD AND
SATISFACTION.
(a) No failure on the part of either party to exercise,
and no delay in exercising, any right or remedy provided for
herein shall operate as a waiver thereof, nor shall any single or
partial exercise by either party or any right or remedy provided
hereunder, preclude any other or further exercise of any other
right or remedy provided hereunder. Any provision of this Lease
Purchase Agreement may be waived by an instrument in writing
executed by the Lessee, the Trustee and MBIA.
(b) Whenever any payment is not made when due hereunder,
the Lessee promises to pay Lessor, in addition to the amount due,
interest thereon at the Overdue Rate, for the.period of delay.
(c) Lessor is ~ntitled to accept, receive and cash or
deposit any payment by Lessee for any reason or purpose in any
amount whatsoever. No endorsement or statement on any check or
letter of Lessee shall be deemed as accord and satisfaction or
otherwise recognized for any purpose whatsoever. The acceptance
of any such payment shall be without prejudice to Lessor's right
to recove'r any and all amounts owed by the Lessee hereunder and
Lessor's right to pursue any other available remedy.
40
15. RISK OF LOSS; STIPULATED LOSS VALUES.
As between Lessor and the Lessee, ~he Lessee hereby assumes
the entire risk of loss, from any and every cause whatsoever to
the Project including without limitation a loss resulting from
exercise of eminent domain or condemnation with respect to all or
part of the Project (collectively, an "Event of Loss"). The Rent
hereunder shall not abate (in whole or in part) upon the occur-
rence of an Event of Loss or during the pendency of repairs
following same, whether or not the Lessee is prevented from using
all or any portion of the Project.
(a) Except as provided in paragraph (b) below, the Lessee
shall cause the Net Proceeds of any insurance or condemnation
award or of any appropriation made in connection with a self-
insurance election to be applied to the prompt repair, restoration
o r replacement of the 'Project (which repair, restoration or
replacement of the Project shall become part of the Project). Any
such Net Proceeds shall be deposited with the Trustee in the
Project Fund and shall be deposited and disbursed by the Trustee
in accordance with section 5.03.1(f)(ii) of the Trust Indenture;
provided, however, that any amounts remaining after completion of
such repair, restoration or replacement shall--b~applied as a
p repayment of Basic Rent hereunder pursuant to Section 16.2
hereof. If such Net Proceeds are insufficient to pay for such
repair, restoration or replacement, the Lessee shall (from
Lessee's legally available Non-Ad Valorem Revenues) simultaneously
deposit the amount of such deficiency with the Trustee and failure
to do so shall constitute an Event of Lease Default hereunder.
(b) The Lessee may elect not to repair, restore or
replace the Project with the Net Proceeds of any insurance- or
condemnation award or of any appropriation made in connection with
a self-insurance election by filing a certificate with the Trustee
stating (i) that it has made such election, (2) that it is not in
the best interests of the Lessee to repair, restore or replace the
Project, and (3) either (A) that the operation of the Project will
not be materially adversely affected by not repairing, restoring
or replacing portions of the Project suffering the Event of Loss
or (B) that the Lessee intends to abandon and cease to operate
portions of the Project; provided, further, that in the former
case, there shall be an Event of Mandatory Prepayment in the
amount of such Net Proceeds and in the latter case, there shall be
an Event of Mandatory Prepayment in the amount of the greater of
the Net Proceeds or the Stipulated Loss Value of the Project and
if the Net Proceeds are insufficient therefor, the deficiency
shall constitute Supplemental Rent hereunder and an amount equal
to such deficiency shall be immediately due and payable from the
Lessee under this Lease Purchase Agreement.
The ~ti~,J]ated l,os~ I/~ll~ a~tributab]e to a loss of tb~
41
case, the Stipulated Loss Value shall also fnclude interest
accrued through the date of payment computed in accordance with
Section 2.8(b) hereof and any Supplemen{el Rent then due here-
under. Upon payment of such Stipulated Loss Value by the Lessee,
such Stipulated Loss Value (or the Net Proceeds if the Net
Proceeds are greater than the Stipulated Loss Value) shall be
deposited to the credit of the Extraordinary Redemption Fund.
42
16. CERTIFICATES; MANDATORy PREPAYMENT.
16.1. Certificates.
(a) This Lease Purchase ~4reenent and Lessor's rights
hereunder with respect to the Project and the Rent or other sums
to become due hereunder (collectively referred to herein as the
"Lease Rights") shall be assigned to and held by the Trustee for
the benefit of the Certificate Owners and the Trustee shall
execute, authenticate and deliver the Certificates evidencing an
undivided interest of the Owners thereof in the Basic Rent
Payments to be made hereunder.
(b) Lessor and the Lessee hereby agree that from and
after the execution by the Trustee and the Lessee of the Trust
Indenture and so long as same remains in effect, payment to the
Trustee of any moneys or sums due hereunder shall satisfy the
obligation for the payment of such moneys or sums.
16.2. Mandatory Prep~ient. In the event that (a) there
is an excess of Net Proceeds ch is to be applied as a prepay-
ment of Basic Rent hereunder pursuant to Section 15(a) hereof, or
(b) funds' in excess of $50,000 remain in the Project Fund (without
taking into account amounts in the Capitalized Interest Account)
on the Estimated Completion Date, or (c) there occurs an Event of
Mandatory Prepayment as provided in Section 15(b) hereof, same
shall constitute an "Event of Mandatory Prepayment". Upon the
occurrence of an Event of Mandatory Prepayment, the Lessee hereby
authorizes the Trustee to credit the balance then remaining in the
Project Fund (other than the Capitalized Interest Account thereof)
to the Extraordinary Redemption Fund to redearn a portion of the
Certificates and the amount of such redemption of principal. of
Certificates shall be credited against the Principal Portion of
the Basic Rent Payments hereunder, in inverse order of maturity.
Such redemption shall be applied by the Lessor to such Basic Rent
Payments without premium or penalty. Upon such redemption, the
remaining Basic Rent Payments hereunder (and the respective
Interest Portion and Principal Portion of each) shall be reduced
and the Concluding Payments recalculated pursuant to Section
hereof.
ments to be made a after , 19 are. character'
i zed as redemption of the Principal Portion o~"Basic Rent due
hereunder on , 20 and Term Certificates are being
issued therein. Even though suc"h payments are characterized as a
mandatory redemption in the nature of a sinking fund for purposes
of the Certificates, same are Basic Rent Payments hereunder and
shall be deposited to the credit of the Rent Payment Fund.
1~,4. Authorization to Transfer Funds. Upon the occur-
tion hereunder, Lessee hereby authorizes the Trustee to transfer
the balance, if any, in the Project Fund to the credit of the
Special Redemption Fund.
43
17. PREPAYMENT OPTION; PURCHASE OPTION.
17.1. Prepayment Option. The Lesse~ shall have the option,
so long as the Lessee Is not then in default under this Lease
Purchase Agreement, but only with moneys provided by the Lessee,
on each Optional Redemption Date, as set forth on Exhibit C
hereto, to prepay a portion of the Basic Rent Payments effective
on any such Optional Redemption Date upon fifteen (15) days' prior
written notice to Lessor accompanied by the deposit of the amount
of such prepaid Basic Rent with the Trustee not less than thirty
(30) days prior to such date of redemption. Any redemption in
part shall be not less than the Minimum Optional Redemption
Amount.
17.2. Option to Purchase. Lessor as "Optionor" hereby
g rants unto Lessee as "Optionee" the irrevocable Option (the
"Option") and right to purchase the Project demised under this
Lease Purchase Agreement on any Optional Redemption Date (or if
done by defeasance hereof pursuant to Section 19 hereof, at any
time hereunder) on following terms and conditions:
(a) The purchase price ("Option Price") shall be the
Balance Dde Lessor with respect to the Project as of the applic-
able Basic Rent Payment Date.
(b) So long as the Lease Term has not terminated and no
event which, with the giving of notice or lapse of time or both,
would constitute an Event of Lease Default hereunder, the Lessee
shall have the right to exercise this Option to purchase the
Project demised under this Lease Purchase Agreement at any time
prior to the expiration of the Lease Term.
(c) The exercise of the Option to purchase shall be by
written notice (the "Option Notice") to the Lessor sixty (60) days
prior to the date set for "closing" which shall be effective when
mailed or, if not mailed, when personally delivered to Lessor.
(d) The "closing" pursuant to this Option shall occur
upon execution and delivery of a deed from Lessor to Lessee, exe-
cution and delivery of an assignment by Lessor to Lessee of all of
Lessor' s right, title and interest as Lessor under this Lease
Purchase Agreement, as well as the execution and delivery of all
other documents required to vest in Lessee the title as required
hereby and the payment of the Option Price.
(e) Upon such closing, the deed from Lessor to Lessee,
the assignment to Lessee of all of Lessor' s right, title and
interest as Lessor under this Lease Purchase Agreement, as well as
any other necessary instruments required to vest in Lessee good
and marketable and insurable title, subject only to those matters
~er~d~b~or~ s..ne.~c~ficall_v set forth shall be recorded a~d the cash
be applied pursuant to Section 19 hereof or Section ~.02 of the
Trust Indenture whichever is applicable.
44
(f) The parties agree that the LessEe shall pay all
expenses of closing including Lessor's expenses.
(g) Lessee shall have the right to record a Memorandum
of Option in the form of Exhibit E hereto in the Public Records of
Seminole County.
45
18. RECALCULATION OF BASIC RENT PAYMENTS.
In the event of a prepayment in pare of Basic Rent Payments
under Section 16.2 or Section 17.1 hereof, the Concluding Payment
applicable at the time of such prepayment shall be reduced to
reflect the reduction in Principal Portion of Basic Rent outstand-
ing hereunder and a revised schedule of Basic Rent Payments and
Concluding Payments shall be prepared by the Lessor and provided
to the Lessee.
46
19. DEFEASANCE.
With respect to the Basic Rent her~under, all of the Basic
Rent Payments shall be deemed to be paid: (i) when there is
irrevocably deposited with or made available to the Trustee in
trust and irrevocably set aside exclusively for payment of the
Basic Rent Payments money sufficient to pay, or non-callable
Governmental Obligations which mature as to principal and interest
in such amounts and at such times as will insure the availabilioty,
without reinves~nent, of-sufficient money to pay, the Option Price
on the next Optional Redemption Date and all Basic Rent Payments
payable on or before such next Optional Redemption Date, and (ii)
when all Supplemental Rent, including without limitation, all
amounts and fees due or payable to the Trustee hereunder, shall
have been paid or the payment thereof provided for to the satis-
faction of the Trustee hereunder, shall have been paid or the
payment thereof provided' for to the satisfaction of the Trustee
have been satisfied. When all of the Rent is deemed paid, as
aforesaid, and the Trustee has received (x) an opinion of Special
Counsel to the effect that the deposit of such money or non-
callable Governmental Obligations in trust will not cause the
Interest Portion of the Basic Rent Payments to be included in
gross income for federal income tax purposes under the Code and
(y) an accountant's certificate with respect to the sufficiency of
the money or such non-callable Governmental Obligations so depos-
ited, and the requirements of Section 10.04 of the Trust Indenture
have been satisfied, the Lessor shall be entitled to payment
solely from such money or Governmental Obligations and all right
and interest of the Lessor under this Lease Purchase Agreement
shall terminate and Lessor shall assign all of its right and
interest in and to this Lease Purchase Agreement to the Lessee,
and the Lessor shall, at Lessee's sole expense, transfer title to
the Project to the Lessee.
47
20. SPECIAL PROVISIONS WITH RESPECT TO MBIA.'
[To Be provided] '~
48
21. LESSOR'S INDEMNITY.
TO the extent permitted by Applicable Law but solely from
Lessee' s legally available Non-Ad Valorem Revenues, the Lessee
hereby agrees to protect, indemnify, pay and save Lessor harmless
from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable
attorneys' fees) that Lessor may, other than as a result of the
g ross negligence or willful misconduct of Lessor, incur or, be
subject to as a consequence, direct or indirect, of (i) the exe-
cution hereof and the performance of the Lessor' s obligations
hereof ( i i) any breach by any party of any representation or
warranty, covenant, term or condition in, or the occurrence of any
default under, the Certificate DOcuments, including all reasonable
fees or expenses resulting from the settlement or defense of any
claims or liabilities arising as a result of any such breach or
default, (iii) the involvement in any legal suit, investigation,
proceeding, inquiry or action as to which the Lessor is involved
as a consequence, direct or indirect, of its execution hereof and
the performance of the Lessor's obligations hereunder.
49
22. INTEGRATION; AMENDMENTS.
Except as explicitly provided hereln, this Lease Purchase
Agreement contains the entire agreement between the parties and
may not be altered, modified, terminated or discharged (except in
accordance with its terms) except in writing and executed by the
Lessor, with the consent of the Trustee, and by Lessee (after
appropriate action of the Commission).
50
24. MISCELLANEOUS.
(a) This instrument shall be deemed to have been executed
and entered into within the State and any dispute arising here-
under shall be governed by the laws of the State with venue in
Seminole County, Florida.
(b) Any provision of this instrument in violation of the
laws of the State shall be ineffective to the extent of s~ch
violation, without invalidating the remaining provisions of this
instrument. In no event shall the Lessor have any cause of action
against the officers or employees of the Lessee, or against any
elected official of the Lessee based upon or materially related to
any finding by any court that any or all provisions of this
instrument violate State law.
(c) The Section headings used herein are for convenience
or reference only and shall have no significance in the interpre-
tation of this instrument.
(d) This Lease Purchase Agreement shall be binding upon
the parties hereto only when duly executed and delivered on behalf
of the LeSsee and the Lessor.
(e) Time is of the essence of this Lease Purchase Agree-
ment and of each of the covenants contained herein.
(f) In addition to the rights of assignment provided for
in Section 16.1, the Lessor hereunder shall have the right at any
time or times, by notice to the Lessee, to 'designate or appoint
any .person or entity to act as agent or trustee for Lessor for any
purposes hereunder.
(g) This Lease Purchase Agreement may be executed in
several counterparts, each of which together with a counterpart
executed by each of the other parties hereto shall constitute a
single original and shall constitute but one and the same agree-
ment.
(h) For purposes of computing any period of a number of
days hereunder for notices or performances (but not for accrual of
interest) for periods of ten (10) days or less, only Business Days
shall be counted·
(i) The Lessee represents and warrants that it has
neither caused nor incurred any claims for brokers' commissions or
finders' fees in connection with the execution of this Lease
Purchase Agreement and, to the extent of Lessee's legally avail-
able Non-Ad Valorem Revenues and to the extent permitted by
Applicable Law, indemnifies and holds Lessor harmless from and
in connection therewith).
52
(j) This Lease Purchase Agreement is dated as of the
date set forth above for convenience of reference only. The
actual date of execution by each party h~reto is set forth below
the respective signatures for each party below and the effective
date is the Issue Date.
[remainder of page intentionally left blank]
53
IN WITNESS WHEREOF, each of the parties hereto have caused
this Lease Purchase Agreement to be executed by their duly autho-
rized officers or agents, all as of the day and year indicated
above, but effective on the Issue Date.
(SEAL) CITY OF SANFORD FINANCE
CORPORATION
ATTEST:
By:
Title: Title:
Date: , 1989
STATE OF FLORIDA )
) SS:
COUNTY OF )
I, , a Notary Public in and for the said
COUNTY in the State aforesaid, do hereby certify that
........ and , personally known to be to
be the same persons whose names are, respectively as
and of sub-
scribed to the foregoing instrument, appeared before me this day
in person and severally acknowledged that they, being thereunto
duly authorized, signed, sealed with the seal of said ,
and delivered the said instrument as the free and voluntary act of
s aid and as their own free and voluntary act, for
uses and purposes therein set forth.
GIVEN under my hand and notorial seal this day of ,
1989.
(SEAL)
Notary Public
My commission expires:
54
(SEAL) CITY OF SANFORD, FLORIDA
ATTEST:
By:
City Clerk Mayor
Date: , 1989
STATE OF FLORIDA )
) SS:
COUNTY OF )
I, , a Notary Public in and for the said
COUNTY in the State aforesaid, do hereby certify that
and , personally known to be to
be the same persons whose names are, respectively as
and of sub-
scribed to the foregoing instrument, appeared before me this day
in person and severally acknowledged that they, being thereunto
duly authbrized, signed, sealed with the seal of said '-
and delivered the said instrument as the free and voluntary act of
said and as their own free and voluntary act, for
uses and purposes therein set forth.
GIVEN under my hand and notorial seal this ~ay of __,
1989.
(SEAL)
Notary Public
My commission expires:
STATE OF FLORIDA )
) SS:
COUNTY OF )
I, , a Notary Public in and for the said
COUNTY in the State aforesaid, do hereby certify that
and , personally known to be to
be the same persons whose names are, respectively as
and of s~b-
scribed to the foregoing instrument, appeared before me this day
in person and severally acknowledged that they, being thereunto
duly authorized, signed, sealed with the seal of said ,
and delivered the said instrument as the free and voluntary act of
said and as their own free and voluntary act, for
uses and purposes therein set forth.
GIVEN under my hand ~nd notorial seal this__ day of __,
1989.
(SEAL)
Notary Public
My commission--expires:
56
STATE OF FLORIDA )
) SS:
COUNTY OF )
I, , a Notary Public in and for the said
COUNTY in the State aforesaid, do hereby certify that
and , personally known to be to
be the same persons whose names are, respectively as
and of s,ub-
scribed to the foregoing. instrument, appeared before me this day
in person and severally acknowledged that they, being thereunto
duly authorized, signed, sealed with the seal of said ,
and delivered the said instrument as the free and voluntary act of
said and as their own free and voluntary act, for
uses and purposes therein set forth.
GIVEN under my hand ~nd notorial seal this __ day of ,
1989.
( SEAL )
Notary Public
My commission expires:
57
EXHIBIT A
FORM OF REQUISITIO~
[TO BE PROVIDED]
EXHIBIT B
TO LEASE PURCHASE AGREEMENT
pROJECT:
A. Building-
B. Land
C. Equipment.
EXHIBIT C
TO LEASE PURCHASE AGREEMENT
RENT AND TERMS
A. LEASE PURCHASE AGREEMENT.
1. The Project, which is described in Exhibit B to the Lease
Purchase Agreement and has an aggregate Cost of not more than $
(the "Maximum Cost"), is to be delivered to and leaRe
purc'?~sed by the Lessee from Lessor pursuant to the terms of the
Lease Purchase Agreement.
2. The "Item PurChase Price or Cost" for each Project
component shall be as set forth in the Requisition with respect
thereto.
3. The Issue Date is , 1989 and the Lease Commence-
ment Date for the Lease Purchase A~reement is 1, 1989 and
the Lease Termination Date is 1,
4. The "Initial Lease Term" is l, 1989 through
September 30, 1990, such later date being the "Initial Lease
Termination Date".
5. "Renewal Lease Terms" are the twenty-five (25) consecu-
tive one (1) year terms each commencing on October 1.
6. "Renewal Term Termination Date" shall mean September 30
as the final day of such Renewal Term.
7. The Maximum Lease Term is approximately 25 years and
three months.
8. The Acceptance Expiration Date is __, 19__.
9. "Estimated Completion Date" is
10. The "Certificates" are the Certificates of Participation
issued under the Trust Indenture and identified .as "CERTIFICATES
OF PARTICIPATION (1989 CITY OF SANFORD PROJECT).
11. "Minimum Optional Redemption AmountN m~ans an amount
necessary to redeem not less than $100,000 in Principal Payments
of Certificates.
12. "Optional Redemption Date" means any Basic Rent Payment
Date on or after the "First Optional Redemption Date" which is
C-1
13. "Optional Redemption Amount" means $5,000 or any
integral multiple thereof.
14. "Interest Rate" is %.
15. "Contractor" shall mean
16. "Architect" shall mean .°
B. LEASE PURCHASE RENT.
The Basic Rent Payable by Lessor with respect to the Project
under the Lease Purchase Agreement and the Concluding Payment as
of each Basic Rent Paymen{ Date is as follows:
C-2
Basic Rent
Payment Total Interest Principal Concluding
Renewal Term Date Basic Rent Portion Portion Payment
[To Be Provided]
C-3
Addresses for notices under the Lease Purchase Agreement are as
follows:
(1) To the Lessee:
With a copy to:
(2) To the Lessor:
(3) To the Developer:
(4) To the Trustee:
(5) To MBIA:
C-4
EXHIBIT D
BUDGET
PROJECT COSTS:
COSTS OF ISSUANCE:
CONSTRUCTION COSTS: $
$
MAXIMUM COSTS $
ANTICIPATED DRAWS:
Date Categories Other Total
EXHIBIT E
FORM OF MEMORANDUM OF LEASE'-AND NOTICE
OF OPTION FOR RECORDING
[TO BE PROVIDED]
BM&O DRAFT
09/22/89
2100.3
DEFINITION EXHIBIT
"Acceptance Expiration Date" shall mean the Acceptance Expir-
ation Date set forth in Exhibit C to the Lease Purchase
Agreement.
"Acquisition Completion Date" shall mean the earlier of (i)
the Acceptance Expiration Date or (ii) the Completion Date.
"Act" shall mean Chapter 166, Florida Statutes, [and City of
Sanford Charter and any applicable ordinance] as [each] may from
time to time be supplemented or amended.
"Acquisition Contract" shall mean, collectively, (i) with
respect to items of Equipment, the Vendor Contract pursuant to
which same is being acquired by the Lessee and (ii) with respect
to components of the Project which are not Equipment, the Develop-
ment Agreement.
"Aaditional Interest" sh~ mean interest at the Overdue
Rate accrued as Supplemental Rent under the Lease Purchase
Agreement.
"Applicable Law" shall mean all applicable provisions of all
constitutions, statutes, rules, regulations and orders of all
governmental and quasi-governmental bodies, all Governmental
Approvals and all orders, judgments and decrees of all courts and
arbitrators.
"Architect" shall mean the Person identified as "Architect"
in Exhibit C to the Lease Purchase Agreement.
"Assignment" shall mean the Assignment of Lease Agreement by
the Lessor to the Trustee assigning all of the Lessor's rights
under the Lease Purchase Agreement tothe Trustee for the benefit
of the Owners of the Certificates.
"Attorneys' ~Fees" shall mean reasonable attorneys' fees and
paralegals' fees and court costs through all trial and appellate
levels and post-judgment proceedings.
"Authorized Denominations" shall mean $5,000, or any integral
multiple of $1,000 in excess thereof.
"Authorized Representative" shall mean (1) with respect to
the Lessee, the Financial Officer or any other person designated
by the Lessee as an Authorized Representative of the Lessee
filed with the Trustee and (2) with respect to the Lessor, any
person or persons designated as Authorized Representative by the
Lessor to the Trustee in writing.
"Balance Due Lessor" shall mean the applicable amount as
described in Section 2.8 of the Lease Purchase Agreement.
"Basic Rent" or "Basic Rent Payment" shall mean the Basic
Rent Payments set forth in Exhibit C to the Lease Purchase Agree-
ment.
"Basic Rent Payment Date" shall mean each Basic Rent Payment
Date set forth in Exhibit C to the Lease Purchase Agreement.
"Budget" shall mean the Budget for the Project set forth in
Exhibit D to the Lease Pu. rchase Agreement.
"Building" shall mean the fire station to be constructed on
the Land.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks located in the U.S. city in
which the Principal Office of the Trustee is located are required
or authorized by law to remain closed or on which the New York
Stock Exchange is closed.
"Capitalized Interest Account" means the Capitalized Interest
Account created and established within the Project Fund by the
Trustee pursuant to Section 5.01(a) of the Trust Indenture with
respect to the Certificates and the Proceeds.
"Certificate Documents" shall mean, at any time, each of the
following as in effect or as outstanding, as the case may be at
such time: (i) the Certificates, (ii) the Trust Indenture, (iii)
the Certificate Purchase Contract, (iv) the Lease Purchase Agree-
ment, ( v ) the Ass ignment, ( vi ) the Development Agreement, and
(vii) the Collateral Assignment.
"Certificate Interest Payment" shall mean the Certificate
Payments representing undivided interests in the Interest Portion
of the Basic Rent Payments under the Lease Purchase Agreement.
"Certificate Interest Payment Date" shall mean a Basic Rent
Payment Date upon which an Interest Portion of Basic Rent Payment
is due.
"Certificate Maturity Date" shall mean the date upon which
the Certificate Principal Payment represented by such Certificate
matures .
Trust Indenture.
"Certificate Payment Date" shall mean each semi-annual Certi-
ficate Payment Date.
"Certificate Payments" shall mean the Certificate Principal
Payments and the Certificate Interest Payments.
"Certificate Principal Payment" shall mean the Certificate
Payments representing undivided interests in the Principal Portion
of a Basic Rent Payment under the Lease Purchase Agreement.
"Certificate Principal Payment Date" shall mean a Basic Rent
Payment Date upon which a Principal Portion of Basic Rent Payment
is due.
"Certificate Purchase Contract" shall mean the Certificate
Purchase Contract dated , 1989, between the Lessor and the
Underwriter and joined in and consented to by the Lessee.
"Certificate Register" or "Register" shall mean the register
provided for by Section 2.09 of the Trust Indenture and kept for
such purpose by the Trustee with respect to the Certificates.
"C&rtificate Year" shall mean each twelve (12) month period
beginning and ending on
"Certificates" or "Certificates of Participation" shall mean
the Certificates of Participation, executed, authenticated and
delivered by the Trustee pursuant to the Trust Indenture.
"City" shall mean the City of Sanford, Florida, a municipal
corporation and a political subdivision of the State of Florida.
"City Clerk" shall mean the Clerk of the City Commission of
the City of Sanford, Florida.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder.
"Collateral Assignment" shall mean the Collateral Assignment
of Development Agreement by the City to the Trustee.
"Commission" shall mean the City Commission of the Lessee.
"Completion Date" shall mean the actual date of completion of
the acquisition, construction and equipping of all portions of the
Project.
"Concluding Payment" shall mean, as of any Basic Rent Payment
Date, that amount which (assuming the Basic Rent Payment due on
that date has been made) is necessary to prepay all of the Certi-
taLeS, ii~ClU~i~ig ~le ~reml~n Portion, il any, as
Exhibit C to the Lease Purchase Agreement and interest accrued
thereon to the Prepayment Date.
3
"Contractor" shall mean the Person designated as such pursu-
ant to the Lease Purchase Agreement.
"Costs" shall mean the costs (other than Costs of Issuance)
identified in the Budget which shall include all costs of con-
struction and may include, but are not limited to, interest under
the Lease Purchase Agreement, but only during the period prior to
placing the Project in service, and may also include items such as
site preparation, architectural and engineering fees, design fees,
development fees and other fees for professional services related
to the design or construction of such Project, the Lessee's admi-
nistrative expenses related to the Project and may also include
the cost of functionally related equipment and construction
management fees, if any, and any similar fees or costs.
"Costs of Issuancq" shall mean the expenses incurred in
issuing the Certificates, including without limitation, advertis-
ing and printing costs, financial advisors and counsel fees (which
may include fees for Counsel to the Lessee and the Lessee's admin-
istrative expenses related to the financing of the Project) under-
writing and placement fees and commissions, municipal bond insur-
ance premiums, initial fees and expenses (including counsel fees)
of' the'Trustee, paying agents and certifying or authenticating
agents.
"Costs of Issuance Account" shall mean the Costs of Issuance
Account created and established within the Project Fund by the
Trustee pursuant to Section 5.01(a) of the Trust Indenture with
respect to the Certificates and the Proceeds.
"Dated Date" shall mean 1, 1989, the Dated Date Of the
Certificates.
"Developer" shall mean ,
"Development Agreement" shall mean the Development Agreement
dated as of 1, 1989, between the Lessee and the Developer.
"Directire" shall mean an instrument in writing executed in
one or more counterparts by the Owners of the Certificates, as
determined from the records of the Trustee pursuant to Section
2.09 of the Trust Indenture, or their lawful attorneys-in-fact,
representing no less than fifty-one percent (51%) of the aggregate
Certificate Principal Payments represented by the then Outstanding
Certificates or by MBIA if a Municipal Bond Insurance Policy is in
~ffect.
"Draw Schedule" shall mean the timetable for disbursements
from the Project Fund for acquisition, construction and equipping
"Endorsements" shall mean Endorsements to the Title Insurance
Policy issued by the Title Issuing Agent on behalf of the Title
Insurance Company with respect to each Requisition relating to the
Building and updating status of title and increasing the face
amount of such policy as required.
"Equipment" shall mean, collectively, the items of personal
property included in the Project.
"Estimated Completion Date" shall mean the Estimated Comple-
tion Date set forth in Exhibit C to the Lease Purchase Agreement.
"Event of Default" shall mean the occurrence of an Event of
Default under Section 10.01 of the Trust Indenture.
"Event of Extraordinary Redemption in Part" shall have the
meaning set forth in Section 4.03.1 of the Trust Indenture,
"Event of Extraordinary Redemption in Whole" shall have the
meaning set forth in Section 4.03.1 of the Trust Indenture.
"Event of Lease Default" shall mean the occurrence of an
Event of Default under Section 11 of the Lease Purchase
Agreement.
"Event of Mandatory Prepayment" shall mean the occurrence of
an event described in Section 16.2 of the Lease Purchase Agree-
ment .
"Event of Non-Appropriation" shall have the meaning set forth
in Section 2.6.1 of the Lease Purchase Agreement.
"Event of Optional Redemption" shall mean a redemption des-
cribed in Section 4.02 of the Trust Indenture.
"Event of Special Mandatory Redemption" shall mean a redemp-
tion described in Section 4.03.2 of the Trust Indenture.
"Event of Special Optional Redemption" shall mean a redemp-
tion described in Section 4.02.1 of the Trust Indenture.
"Event of Special Redemption" shall mean, collectively, the
occurrence of either an Event of Special Mandatory Redemption or
an Event of Special Optional Redemption.
"Extraordinary Redemption Fund" shall mean the Extraordinary
Redemption Fund so designated and established pursuant to Section
5.01(d) of the Trust Indenture.
"Final Payment" shall have the meaning set forth in Section
"Final Payment Date" shall mean the Final Payment Date set
forth in Exhibit A to the Trust Indenture which is the Certificate
Maturity Date.
"Financial Newspaper or Journal" shall mean The Wall Street
Journal or The Bond Buyer or any other other newspaper or journal
containing financial news, printed in the English language, cus-
tomarily published on each business day with a national circula-
tion and customarily relied upon by the financial community, and
selected by the Trustee, whose decision shall be fina~ and
conclusive.
"Financial Officer" shall mean the Director of Finance of the
Lessee.
"First Optional Redemption Date" shall mean the First
Optional Redemption Date set forth in Exhibit A to the Trust
Indenture.
"Fiscal Year" shall mean each twelve-month period beginning
October 1 and ending on the next succeeding September 30.
"Ggvernmental Approval" shall mean an authorization, permit,
consent, approval, license or exempti~Ffrom, registration or
filing with, or report to, any governmental or regulatory unit.
"Governmental Obligations" shall mean United States Obliga-
tions as defined in paragraph (1) of Schedule I to the Trust
Agreement.
~Independent insurance Consultant" shall mean a nationally
recognized, independent actuary, insurance company or broker
acceptable to MBIA that has actuarial personnel experienced in the
area of insurance for which the Lessee is to be self-insured.
"Initial Lease Term" and "Renewal Lease Terms" shall mean,
respectively, the Initial Lease Term and the Renewal Lease Terms
set forth in Exhibit C to the Lease Purchase Agreement.
"Initial Lease Termination Date" shall mean the termination
date of the Initial Lease Term set forth in Exhibit C to the Lease
Purchase Agreement.
"Insurance Trustee" shall mean , as
Insurance Trustee for MBIA.
"Interest Portion" shall mean the portion of each Basic Rent
~Payment constituting interest as evidenced by the Certificates.
"Interest Rate" shall mean the Interest Rate set forth in
Exhibit C to the Lease Purchase Agreement.
6
"Investment Property" shall mean "investment property" as
such term is used in the Code with respec~ to Sections 103 and 148
of the Code.
"Issue Date" shall mean , 1989.
"Item Purchase Price" shall mean the portion of the total
invoice cost to be financed under the Lease Purchase Agreement
(which may include charges for installation, delivery or prepa{a-
tion, on-site testing, or similar charges) for an item of Equip-
ment, as identified in the Requisition submitted to the Trustee
for payment for such item of Equipment.
"Land" shall mean the real property described in Exhibit B to
the Lease Purchase Agreement.
"Lease Commencement 'Date" shall mean the Lease Commencement
Date set forth in Exhibit C to the Lease Purchase Agreement.
"Lease Purchase Agreement" shall mean the Lease Agreement
with Option to Purchase dated as of 1, 1989, between the
Lessee and the Lessor.
"Lease Purchase Rent" or "Lease Purchase Rent Payments" shall
mean, collectively, Basic Rent, Supplemental Rent and all other
amounts due under such Lease Purchase Agreement.
"Lease Purchase Revenues" shall mean all amounts paid and
collected pursuant to or with respect to the Lease Purchase Agree-
ment, including, without limiting the generality of the foregoing,
all payments of Lease Purchase Rent, prepayments, Net Proceeds of
insurance, or condemnation proceeds, and any and all interest,
profits or other income derived from the investment thereof in the
Lessee's Funds established pursuant to the Trust Indenture.
"Lease Rights" shall have the meaning set forth in Section
16.1 of the Lease Purchase Agreement.
~Lease Term" shall mean collectively, the Initial Lease Term
and all exercised Renewal Lease Terms.
"L~ase Termination Date" shall have the meaning set forth in
Exhibit C to the Lease Purchase Agreement.
"Lessee" shall mean the City of Sanford, Florida, a municipal
corporation and a political subdivision of the State of Florida.
"Lessee's Funds" shall mean, collectively, the Project Fund,
the Rent Payment Fund, the Opt ional Redemption Fund, the Extra-
ordinary Redemption Fund, the Special Redemption' Fund and the
7
"Lessor" shall mean the City of Sanford Finance Corporation,
a Florida not-for-profit corporation, as lessor under the Lease
Purchase Agreement, and, pursuant to the'-Assignment, the Trustee,
and its successors under the Trust Indenture.
"Lien", aS applied to the property of any Person, shall mean
(in each case, whether the same is consensual or nonconsensual or
arises by contract, operation Of law, legal process or otherwise):
(a) any mortgage, lien, pledge, attachment, charge, finasce,
lease, conditional sale or other title retention agreement, or
other security interest or encumbrance of any kind in respect of
any property of such Person, or upon the income or profits there-
from; and (b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise
identified for the purpose of securing indebtedness or performance
of any other obligation ~n priority to the payment of the general
unsecured creditors of such Person.
"Materially Adverse Effect" shall mean, (a) with respect, to
any Person, a materially adverse effect upon such Person's
business, assets, liabilities, financial condition, results of
operations or business prospects and (b) with respect to any
agreement' or obligation, a materially adverse effect upon the
binding nature, validity or enforceability of such agreement or
obligation.
"Maximum Cost" shall mean the Maximum Cost set forth in Exhi-
bit C to the Lease Purchase Agreement.
"Maximum Interest Rate" shall mean as of any date of deter-
mination the lesser of (i) 18% per annum and ~ii) the maximum
non-usurious rate of interest allowed under the laws of the State
of Florida.
"Maximum Lease Term" shall mean the Maximum Lease Term set
forth in Exhibit C to the Lease Purchase Agreement.
"MBIA" shall mean Municipal Bond Insurance Association and
its successors.
"Minimum Optional Redemption Amount" shall mean the amount so
designated and set forth in Exhibit C to the Lease Purchase
Agreement.
"Moody's" shall mean Moody's Investors Service, Inc., a cor-
poration organized and existing under the laws of the State of
Delaware, its successors and their assigns, and, if such corpora-
tion shall be dissolved or liquidated or shall no longer perform
the functions of a securities rating agency, "Moody's" shall be
deemed to refer to any other nationally recognized securities
"Municipal Bond Insurance Policy" shall mean the municipal
bond insurance policy issued by MBIA simultaneously with the deli-
very of the Certificates, insuring the payment of the Certificate
Principal Payments and the Certificate Interest Payments.
"Net Proceeds" shall mean proceeds from any insurance, con-
demnation award, performance bond, or any other financial guaranty
(except that Net Proceeds shall not include any proceeds of the
Municipal Bond Insurance Policy) or sale paid with respect to, or
for the Project (including the Land) remaining after payment
therefrom of all expenses including attorney's fees incurred in
the collection thereof; and, with respect to insurance, to the
extent that the Lessee selects to self-insure under section 9(c)
[or 20.3.5] of the Lease Purchase Agreement, any moneys payable
from any appropriation to the Lessee in connection with such self-
insurance.
"Non-Ad Valorem Revenues" shall mean all non-ad valorem reve-
nues received by the Lessee except to the extent same are now or
hereafter pledged to payment of obligations of the Lessee.
"Notice by Mail" or "notice" of any action or condition "by
Mail"-shall mean a-written notice meeting the requirements of the
TrUst Indenture mailed by first-class mail to the Owners of speci-
fied Certificates, at the addresses shown on the Certificate
Register maintained pursuant to Section 2.09 of the Trust Inden-
ture.
"Notice of Commencement" shall mean a Notice of Commencement
duly executed in recordable form and meeting the requirements of
Chapter 713, Florida Statutes.
"Notice of Substantial Completion" shall mean a Notice of
Substantial Completion substantially in the form of Exhibit C to
the Trust Indenture.
"Offering Circular" shall mean the Offering Circular relating
to the Certificates dated the date of the Certificate Purchase
Contract and any documents incorporated therein by reference.
"Option" shall mean the purchase option in favor of Lessee
set forth in Section 17.2 of the Lease Purchase Agreement.
"Option Price" shall have the meaning set forth in Section
17.2(a) of the Lease Purchase Agreement.
"Option Notice" shall have the meaning set forth in Section
17.2(c) of the Lease Purchase Agreement.
"Optional Redemption" shall mean an Optional Redemption of
~- D~-~ o~rtion of Certificate Princjma] Payments represent-
Payment pursuant to Section 4.02 of the Trust Indenture.
"Optional Redemption Fund" shall mean the Optional Redemption
Fund so designated and established pursuant to Section 5.01(c) of
the Trust Indenture.
"Outstanding" shall mean, as of the date of determination all
Certificates theretofore issued, authenticated and delivered pur-
suant to the Trust Indenture except (i) Certificates theretofore
cancelled by the Trustee or surrendered'to the Trustee for cancel-
lation, (ii) Certificates for the transfer or exchange of or in
lieu of or in substitution for which other certificates shall have
been authenticated and delivered by the Trustee pursuant to the
Trust Indenture, (iii) Certificates which have been deemed sur-
rendered for redemption or mandatory purchase and for which the
Trustee holds in trust for the Owners the Redemption Price or the
purchase price of such Certificates, and (iv) Certificates paid or
deemed to be paid pursuant to Article XII of the Trust Indenture.
"Overdue Rate" shall mean, with respect to Supplemental Rent
owed to any Person, the Maximum Rate.
"Owner" or "Certificate Owner" shall mean the owner of a
Certificate as shown on the Certificate Register kept pursuant to
Section ~.09 of the Trust Indenture.
"Paying ~gent" shall mean the Trustee.
"Permitted Encumbrances" shall mean encumbrances described in
Schedule B to the Title Insurance Policy.
"Person" shall mean an individual, a corporation, a partner-
ship, an association, a joint stock company, a trust, any unincor-
porated organization or a government or political subdivision
thereof or any other entity.
"Plans and Specifications" shall mean the plans and specifi-
cations as described in Section 6.02.1(a) of the Trust Indenture.
"Premium Portion" shall mean the Premium Portion, if any, of
Basic Rent Payment due under the Lease Purchase ~greement upon an
Optional Redemption.
"Prepayment Option" shall mean the right Of the Lessee to
prepay the amounts due under the Lease Purchase Agreement pursuant
to Section 17.1 thereof.
"Principal and Interest Payments" shall mean the payments of
principal and interest to be made by the Lessee pursuant to the
schedule of Basic Rent Payments set forth in Exhibit C of the
Lease Purchase Agreement.
"principal Office" of the Trustee oF the Paying Agent shall
10
"Principal Portion" shall mean the portion of each Basic Rent
Payment constituting principal, if any, as evidenced by the Certi-
ficates.
"Proceeds" shall mean the aggregate moneys paid by the Under-
writer for the Certificates to the Trustee, less any applicable
Underwriter's discount or original issue discount.
"Project" shall mean the Project as set forth on Exhibit B to
the Lease Purchase Agreement.
"Project Fund" shall mean the Project Fund created and esta-
blished with the Trustee pursuant to Section 5.01(a) of the Trust
Indenture with respect to the Proceeds and the Project which con-
sists of the Acquisition Account, the Capitalized Interest Account
and the Costs of Issuance Account.
"Qualified Investments" shall include any of the securities
set forth on Schedule I to the Trust Indenture, if and to the
extent the same are at the time legal under State law for invest-
ment of the Lessee's Funds.
"Real Estate Taxes" shall mean all real estate-taxes, public
and governmental charges and assessments, including all extraor-
dinary or special assessments, or assessments against any of
Lessor's personal property included in the Project, all costs,
expenses and attorneys' fees incurred by the Lessor in contesting
or negotiating with public authorities as to any of same and all
sewer and other similar taxes and charges.
"Rebate Account" shall mean the Rebate Account created and
established with the Trustee pursuant to Article VII of the Trust
Indenture with respect to the Lease Purchase Agreement.
"Record Date" shall mean fifteen ( 15 ) days prior to each
Certificate Payment Date.
"Redemption Date" shall mean with respect to a Certificate,
its Redemption Date as set in accordance with Article IV of the
Trust Indenture.
"Redemption Fund" shall mean, collectively, the Extraordinary
Redemption Fund, the Optional Redemption Fund and the Special
Redemption Fund.
"Redemption Price" shall mean, with respect to any Certifi-
cate (or portion thereof) the Certificate Principal Payments
represented by such Certificate (or portion thereof) including the
Premium Portion, if any, plus the Certificate Interest Payments
accrued thereon, if any, to the Redemption Date payable upon pre-
11
"Registrar" shall mean the Trustee, or its successor as
Registrar.
"Renewal Term Termination Date" shall mean the termination
date for such Renewal Agreement Lease Term set forth in Exhibit C
to the Lease Purchase Agreement.
"Rent" or "Rent Payments" shall mean, collectively, Basic
Rent, Supplemental Rent and all other amounts due under the Lease
Purchase Agreement.
"Rent Payment Fund" shall mean the fund by that name esta-
blished pursuant to Section 5.01(b) of the Trust Indenture.
"Requisition" shall mean a completed Requisition in the form
of Exhibit A to the Lease Purchase Agreement.
"Reserve Deficiency" shall mean the amount by which the
balance in the Reserve Fund, from time to time, is less than the
Reserve Requirement.
"Reserve Fund" shall mean the Reserve Fund created pursuant
to Sectioh 5.01(e) of the Trust Indenture.
"Reserve Requirement" shall mean an amount equal to $
which shall be deposited to the Reserve Fund on the Issue Date
from Proceeds.
"Resolution" shall mean the Resolution of the Commission of
Lessee adopted on , 1989.
"Serial Certificates" shall mean Certificates with a Certi-
ficate Principal Payment Date on or before
"Special Counsel" shall mean Bryant, Miller and Olive, P.A.,
Tallahassee, Florida, or any other law firm of nationally recog-
nized bond counsel familiar with the transactions contemplated
under the Certificate Documents.
"Special Redemption Fund" shall mean the Special Redemption
Fund created pursuant to Section 5.01(f) of the Trust Indenture.
"Standard & Poor's" or "S&P" shall mean Standard & Poor's
Corporation, a corporation organized and existing under the laws
of the State of New York, its successors and their assigns, and if
such corporation shall be dissolved or liquidated or shall no
longer perform the functions of a securities rating agency, "S&P"
shall be deemed to refer to any other nationally recognized secur-
ities rating agency.
"Stipulated Loss Value" shall mean the Stipulated Loss Value
computed pursuant to Section 15 of the Lease Purchase Agreement.
12
"Supplemental Rent" shall have the meaning set forth in Sec-
tion 2.4 of the Lease Purchase Agreement.
"Term Certificates" shall mean Cereificates with a Certifi-
cate Principal Payment Date on or after
"Third Party Assignment" shall mean, with respect to any
Vendor Contract, the assignment of the Lessee's right to acquire
the Equipment described in the Vendor Contract for the purchase
price set forth therein.
"Title Insurance Commitment" shall mean the Commitment for
Title Insurance No. dated , 1989 issued by the
Title Issuing Agent on behalf of the Title Insurance Company and
showing the Lessor as owner of the Land.
"Title Insurance Company" shall mean
"Title Insurance Policy" shall mean the Policy of Title
Insurance to be issued by the Title Issuing Agent on behalf of the
Title Insurance Company pursuant to the Title Insurance Commit-
ment.
"Title Issuing Agent" shall mean
· Florida.
"Trust Indenture" or "Certificate Trust Indenture" shall mean
the Trust Indenture dated as of 1, 1989, between the Trustee
and the Lessee.
"Trust Estate" shall mean, collectively, the moneys, funds
and rights set forth in the granting clause Of the Trust Inden-
ture.
"Trustee's Expenses" shall mean, collectively, all out-of-
pocket expenses, disbursements and advances (including reasonable
attorneys' fees) incurred by the Trustee under the Trust Indenture
in connection with the Certificates and the Trust Estate.
"Trustee" shall mean
, as Trustee under the Trust Inden-
ture and its successors thereunder.
"Underwriter" shall mean William R. Hough & Co.,
St. Petersburg, Florida.
"Vendor" shall mean, with respect to an item of Equipment,
the seller thereof to the Lessee or the Trustee as assignee of the
Lessee's rights under the Vendor Contract.
"~""~ .... ~ ..... ~" q~l ~a~, w~th ~e~nect ~ a~ ~em Of
13
EXHIBIT "C"
FORM OF TRUST INDENTURE
BM&O DRAFT
09/22/89
2100.3
TRUST INDENTURE
by
CITY OF SANFORD FINANCE CORPORATION,
a Florida not-for-profit corporation
(Grantor)
to
[NAME OF TRUSTEE]
(Trustee)
accepted by
CITY OF SANFORD, FLORIDA
(Lessee)
Dated as of 1, 1989
Note: Bracketed Language is subject to the
Requirements of any Credit Enhancement Provider.
TABLE OF CONTENTS
Page
RECITALS ................................. ~ ............... 1
GRANTING CLAUSES ......................................... 3
ARTICLE I
DEFINITIONS
1.01 Definitions .................................... 5
1.02 References to this Trust Indenture ............. 5
ARTICLE II
DESCRIPTION, AUTHORIZATION, MANNER OF EXECUTION,
AUTHENTICATION, REGISTRATION AND TRANSFER OF CERTIFICATES
2.01 Authorization of Certificates, Limitation on
Amount of Certificates and Purposes ........... 6
2.02 General Provisions Concerning the Certificates. 6
2.03 Interest Rate .................................. 8
2.04 Serial and Term Certificates ................. 8
2.05 Form of Certificates ....................... 8
2.06 Execution of Certificates .................. 8
2.07 Transfer of Certificates ................... 8
2.08 Exchange of Certificates ................... 8
2.09 Registration Books ......................... 9
2.10 Temporary Certificates ..................... 9
2.11 Certificates Mutilated, Lost, Destroyed or
Stolen ......................................... 9
2.12 Qualification for Depository Trust Company ..... 10
2.13 Insurance ............ ~ ......................... 10
2.14 Transfer Fees .................................. 10
2.15 Limitation of Principal Amount Of Certificates;
Certificates Secured ........................... 10
2.16 Authentication and Delivery of Certificates .... 11
ARTICLE III
SPECIAL PROVISIONS WITH RESPECT TO MBIA
[To Be Provided] ........................................ 13
ARTICLE IV
REDEMPTION
4.01 Redemption of Certificates; General ............ 14
~.~ C~tlcn~ Redemption ............................ 14
i
Pa~e
ARTICLE VII
ACCEPTANCE; INVESTMENT
7.01 Acceptance .................................... 29
7.02 Investments ................................... 29
7.03 Earnings ...................................... 29
7.04 Method of Valuation and Frequency of
Valuation ..................................... 30
7.05 Investment Of Amounts Representing Accrued
Interest and Capitalized Interest ............. 30
ARTICLE VIII
REBATE ACCOUNT
8.01 Creation of Rebate Account .................... 31
8.02 Determination of Rebate ....................... 31
8.03 Deposits to Rebate Account .................... 32
8.04 Application of Funds in Rebate Account ........ 32
8.05 Trustee Not Liable ............................ 33
8.06 Liens on Moneys in Rebate Account ............. 33
8.07 - Miscellaneous Provisions Concerning Rebate
Account ....................................... 33
ARTICLE IX
COVENANTS OF THE ISSUER
9.01 Limitations on Security ....................... 37
9.02 Payment of Principal, Interest and Redemption
Premium ....................................... 37
9.03 No Extension of Time Of Payment of Interest... 37
9.04 Enforcement and Modification of Lease
Purchase Agreement ........................... 37
9.05 Taxes; Assessments; Liens ..................... 38
9.06 Documentary Stamps and Intangible Tax ......... 39
9.07 Insurance on Project .......................... 40
9.08 No Other Sale or Disposition of Project ....... 40
9.09 Take Further Necessary Actions ................ 40
9.10 Maintenance of Existence; Preservation of
Tax-Exempt Status of Certificates ............. 40
9.11 Fair Market Value of Project .................. 40
9.12 Option to Purchase ............................ 41
9.13 Issuer to Maintain Not-for-Profit Status ...... 41
9.14 Information to be Provided to MBIA ............ 42
ARTICLE X
DEFAULT PROVISIONS AND REMEDIES OF
TRUSTEE AND OWNERS OF CERTIFICATES
!0.01 Defaults ...................................... 43
iii
Page
10.03 Other Remedies .............................. 43
i0 04 Rights of Certificate Owners ' 44
10.05 Application of Moneys ...................... 44
10.06 Remedies Vested in Trustee ................. 46
10.07 Rights and Remedies of Certificate Owners .. 46
10.08 Termination Of Proceedings ................. 47
10.09 Waivers of Events of Defaults ................. 47
10.10 Enforcement of Lease Purchase Agreement ....... 47°
ARTICLE XI
MODIFICATION OR AMENDMENT OF
THIS TRUST INDENTURE
11.01 Amendments Permitted .......................... 49
11.02 Effect of Amendments .......................... 50
11.03 Endorsement of'Certificates: Preparation of
New Certificates .............................. 50
11.04 Amendment of Particular Certificates .......... 51
ARTICLE XII
DEFEASANCE OR DISCHARGE
12.01 Discharge of Trust Indenture as to Trust
Estate ....................................... 52
12.02 Deposit of Money or Securities with Trustee... 52
12.03 Payment of Certificates After Discharge of
Trust Indenture .............................. 53
12.04 Special Requirements With Respect to MBIA ..... 54
ARTICLE XIII
THE TRUSTEE
13.01 Duties, Immunities and Liabilities of Trustee. 55
13.02 Merger or Consolidation ....................... 57
13.03 Liability of Trustee .......................... 57
13.04 Right of Trustee to Rely on Documents ......... 57
13.05 Preservation and Inspection of Documents ...... 58
13.06 Responsibility ................................ 58
13.07 Records; Originals of Documents ............... 58
13.08 Compensation of the Trustee ................... 58
ARTICLE XIV
MISCELLANEOUS
14.01 Trust Indenture Binding Upon Parties and
Successors ................................... 59
14.02 Agreement in Several Counterparts ............. 59
14.03 Applicable Law ................................ 59
14.04 Severability of Provisions .................... 59
~a~e
14.05 No Usury ....................... ~ .............. 59
14.06 Survival Provisions ........................... 59
14.07 Limited Third Party Beneficiaries ............. 59
14.08 Notices ....................................... 60
14.09 Reference Date ................................ 60
SIGNATURES .............................................. 61
INDEX OF EXHIBITS
DEFINITION EXHIBIT
SCHEDULE I Qualified Investments
EXHIBIT A Terms and Conditions
EXHIBIT B Form of Certificate of Participation
EXHIBIT C Form of Notice of Substantial Completion
TRUST INDENTURE
THIS TRUST INDENTURE (this "Trust It{denture"), dated as of
1, 1989, is entered into by '
, a [national banking asso-
ciation] [banking corporation] organized and existing under the
laws of the [United States] [State of ] (the
"Trustee") and City of Sanford Finance Corporation, a Florida
not-for-profit corporation (the "Issuer").
All capitalized terms used herein and not otherwise defined
herein shall have the meaning set forth in the Definition Exhibit
attached hereto pursuant to Section 1.01 hereof.
WITNESSETH:
WHEREAS, pursuant tD the Act and the laws and Constitution of
the State of Florida, the City of Sanford, Florida (the "Lessee"),
a municipal corporation and a political subdivision of the State
of Florida is authorized to enter into a lease agreement with
option to purchase relating to the acquisition and construction of
a fire station and the acquisition of certain equipment for valid
municipal purposes (collectively, the "Project" ); and
WHEREAS, in order to accomplish the financing of the Project,
the Lessee has caused the Issuer to be duly formed as a corpora-
tion not-for-profit under and pursuant to the laws of the State of
Florida for the purpose, among other things, of acquiring the
Project for and on behalf of the Lessee; and
[WHEREAS, the Developer and the Lessee have entered into the
Development Agreement pursuant to which the Developer will .con-
struct and equip the Building on the Land which has been leased by
the Issuer from the Lessee pursuant to the Ground Lease; and]
WHEREAS, by the Resolution duly adopted by the Issuer, the
Issuer has authorized (i) the issuance of the Certificates in the
aggregate principal amount of $ for the purpose of
financing the Project; and (ii) the execution and delivery by the
Issuer of the Lease Purchase Agreement, with the Issuer as Lessor.
Simultaneously herewith, the Issuer and the Lessee are entering
into the Lease Purchase Agreement pursuant to the terms of which
the Issuer is to lease the Project to the Lessee and Lessee is to
make rent payments to the Issuer sufficient in amounts and payable
at times so as to provide for the payment when due of the Certifi-
cate Principal Payment and the Certificate Interest Payment, and
any premium on, the Certificates and for the making of the other
payments provided for in this Trust Indenture and in the Lease
Purchase Agreement; and
~'z:{~m-E~, the Isslae~. by the terms of this Trust Indenture and
without limitation its right in and to the Lease Purchase Rent
required by the terms of the Lease Purchase Agreement to be paid
to the Issuer by the Lessee) to the Trustee in trust for the bene-
fit of the Owners from time to time of the Certificates; and
WHEREAS, the Certificates shall be secured solely as provided
herein, it being expressly agreed that neither the Certificates
nor the interest thereon shall be or constitute a general obliga-
tion of the Lessee, a pledge of the faith and credit of the
Lessee, a lien upon any property of or located within the b~und-
aries of the Lessee except for the Project but shall constitute a
lien only upon the Project and the rentals or proceeds thereof as
provided in this Trust Indenture, the Mortgage and the Assignment;
and
WHEREAS, pursuant to the Ground Lease, the Lessee has con-
veyed a leasehold estate in the Land to the Issuer simultaneously
with execution and delivery hereof and pursuant to the terms
hereof and of the Lease Purchase Agreement, upon the satisfaction
of the terms and conditions of this Trust Indenture such leasehold
estate in and to the Project shall vest again in the Lessee, free
and clear of all liens and encumbrances, except the Permitted
Encumbrances, upon termination of the Lease Purchase Agreement
pursuant to Section 2.2(b) or (d) thereof,~as more specifically
provided therein; and
[WHEREAS, the Lessee has obtained a Municipal Bond Insurance
Policy from MBIA in consideration of the payment by the Trustee of
the fee payable in respect thereof, the satisfaction of the other
conditions precedent to the issuance of such Municipal Bond Insur-
ance Policy and in reliance upon the terms and conditions of this
Trust Indenture; and]
WHEREAS, the Lessee, by resolution of the Commission, duly
passed and adopted, has (1) accepted the formation of the Issuer
for purposes hereinabove set forth; (2) approved of the Issuer's
undertaking the acquisition, construction and equipping of the
Project; (3) approved of the Issuer's issuing the Certificates to
finance the Project; (4) agreed to the terms of the Lease Purchase
Agreement and of this.Trust Indenture and authorized the execution
of the Lease Purchase Agreement and acceptance of this Trust
Indenture on its behalf by proper officers of the Lessee; and (5)
agreed to accept the leasehold estate in and to the Project upon
termination of the Lease Purchase Agreement, free and clear of all
encumbrances except the Permitted Encumbrances; and
WHEREAS, the Lessee and the Issuer have, by resolutions duly
passed and adopted, approved of the terms of this Trust Indenture
and of the Lease Purchase Agreement, and have authorized the
acceptance or execution, as the case may be, of this Trust Inden-
ture by their proper officers; and
WHEREAS, the Issuer has represented and does hereby represent
that is has full power and authority to issue and sell the
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Certificates, to acquire the leasehold estate in the Land, to
mortgage such leasehold estate and the Project, and to lease the
Project, and to pledge its rights under the Lease Purchase Agree-
ment in and to the leases and other receipts thereunder as secur-
ity for the Certificates, and that the board of directors of the
Issuer has taken all action required by law to authorize its
officers to excute, acknowledge and deliver this Trust Indenture,
the Mortgage and the Assignment and to execute and issue the
Certificates; and
WHEREAS, all things necessary to make the Certificates, when
authenticated by the Trustee and issued as provided in this Trust
Indenture, the valid, binding and legal obligations of the Issuer
according to the import thereof, and to make this Trust Indenture
a valid agreement of the Issuer, in accordance with its terms, and
a valid pledge of the rights of the Issuer under the Lease Pur-
chase Agreement in and tO the leases, revenues and receipts there-
under as security for the Certificates have been done and per-
formed, and the execution and delivery of this Trust Indenture,
and the execution and issuance of the Certificates, subject to the
terms hereof, have in all respects been duly authorized; and
WHEREAS, the Trustee has duly accepted the trusts created by
this Trust Indenture and as evidence thereof has joined in the
execution hereof;
NOW, THEREFORE, THIS TRUST INDENTURE OF TRUST WITNESSETH:
For and in consideration of the premises, the mutual cove-
nants of the Issuer and the Trustee, and the purchase of the Cer-
tificates by Owners thereof and in order to secure the payment of
the principal of and premium, if any, and interest on the Certifi-
cates according to their tenor and effect and the performance and
observance by the Issuer of all the covenants expressed or implied
herein and in the Certificates, the Issuer does hereby grant,
bargain, sell, convey, assign, and pledge unto the Trustee and
unto its successors in trust, and to it and its assigns forever to
secure the Certificates and the payments to be made in accordance,
therewith, the following described rights and properties (collec-
tively, with the rights of the Trustee under the Mortgage, the
Assignment and the Collateral Assignment, the "Trust Estate"):
1. The Lease Purchase Agreement and the Lease Rights there-
under (including without limitation the rights to receive the
Lease Purchase Rent and to enforce the covenants thereunder);
2. The Development Agreement; and
3. Moneys in the Project Fund, the Rental Payment Fund, the
Optional Redemption Fund, Extraordinary Redemption Fund, Special
In addition to the foregoing, the Issuer has simultaneously
herewith, granted into the Trustee the Mortgage, the Assignment
3
and the Collateral Assignment to secure the oSligations of the
Issuer under the Certificates and hereunder, all in the manner and
to the extent provided therein.
The Trust Estate does not include the moneys on deposit in
the Rebate Account.
TO HAVE AND TO HOLD all the same with all privileges and
appurtenances hereby and hereafter conveyed and assigned,. or
agreed to or intended so to be, to the Trustee and its respective
successors and assigns in said trust forever;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set
forth for the equal and p~oportionate benefit, security and pro-
tection of all Owners of the Certificates issued under and secured
by this Trust Indenture without privilege, priority or distinction
as to the lien created by this Trust Indenture or otherwise of any
of the Certificates over any of the others of the Certificates;
PROVIDED, HOWEVER, that if the Issuer, its successors or
assigns, shall well and truly pay, or cause to be paid, the prin-
cipal and premium, if any, of the Certificates and the interest
due or tO become due thereon, at the time and in the manner men-
tioned in the Certificates, according to the true intent and mean-
ing thereof, and shall cause the payments to be made into the
funds as required hereunder, or shall provide, as permitted
hereby, for the payment thereof as provided in Article XII of this
Trust Indenture, and shall well and truly keep, perform and
observe all the covenants and conditions of this Trust Indenture
to be kept, performed and observed by it, and shall pay or cause
to be paid to the Trustee all sums of money due or to become due
to it in accordance with the terms and provisions hereof, then,
uDon such final payments or provision for such payments by the
Issuer, this Trust Indenture and the rights hereby granted shall
cause, determine and be void; otherwise this Trust Indenture to be
and remain in full force and effect.
The terms and conditions upon which the Certificates are to
be issued, authenticated, delivered, secured and accepted by all
persons who from time to time shall be or become the holders
thereof, and the trusts and conditions upon which the revenues
pledged are to be held and disposed of, which said trusts and
conditions the Trustee hereby accepts, and the ~espective parties
hereto covenant and agree, are as ~ollows:
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ARTICLE I
DEFINITIONS
Section 1.01 ~ Definitions. Unless the context otherwise
requires, as used in this Trust Indenture the defined terms shall
each have the respective meanings set forth therefor in the Defi-
nition Exhibit attached hereto. Use of the masculine, feminine or
neuter gender herein and therein is for convenience of reference
only and each shall be deemed to mean and include the other gen-
ders whenever and wherever appropriate. The singular of each word
defined includes the plural and the plural includes the singular
whenever and wherever appropriate. Reference to any Certificate
Document or any other document or agreement shall mean such docu-
ment or agreement as same may be amended, modified or supplemented
from time to time in accordance with the terms thereof.
Section 1.02 - Reference to this Trust Indenture. The term
this "Trust Indenture" means the instrument as originally exe-
cuted, as it may from time to time be supplemented or amended
pursuant to the provisions hereof.
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ART ICLE I I
DESCRIPTION, AUTHORIZATION, MANNER OF EXECUTION, AUTHENTICATION,
REGISTRATION AND TRANSFER OF CERTIFICATES
Section 2.01 - Authorization of Certificates, Limitation on
Amount of Certificates and Purposes. This Trust Indenture secures
an issue of Certificates the aggregate principal amount of which
(except for substitute Certificates issued pursuant to Sect%on
2.07, 2.08, 2.10 and 2.11 hereof) is $ to be issued
as hereinafter provided, and creates a continuing pledge as pro-
vided by this Trust Indenture to secure the full and final payment
of the principal of and redemption premium, if any, and intecest
on all of the Certificates in the manner provided herein as the
same shall become due and payable.
The Certificates shall be prepared in the respective aggre-
gate principal amounts and designated as set forth in Exhibit A
hereto but in one series designated as "Certificates of Participa-
tion (1989 City of Sanford Project) Evidencing Fractional
Undivided Interests of the Owners thereof in Basic Rent Payments
to be Made Under a Lease Agreement with Option to Purchase Issued
by the City of Sanford, Florida."
The Proceeds shall be deposited as set focth in Section 5.02
hereof. The Trustee shall not at any time, except as provided in
Sections 2.07, 2.08, 2.10 and 2.11 hereof, execute additional
Certificates secured by this Trust Indenture.
The Certificates shall be issued for the purpose of providing
funds to pay the Costs, and the Issuer shall be obligated to apply
the Proceeds thereof towards the payment of such Costs and'for
other purposes as set forth in Article VI hereof.
Section 2.02 - General Provisions Concerning the Certifi-
cates.
(a) Each of the Certificates shall contain, except as other-
wise provided herein, the same terms and provisions as each of the
other Certificates. Each of the Certificates shall be On a parity
with the other Certificates as to the pledge of and lien on all of
the Trust Estate.
(b) The Certificates each shall be dated as of the Issue
Date, and the Certificate Principal Payment thereunder shall
mature, subject to prior redemption, upon the terms and conditions
hereinafter set forth, on its respective Certificate .Maturity
Date. The Certificates shall be issuableonly as fully registered
Certificates, without coupons, in Authorized Denominations.
l_~ The Certl 1 ..... m upward
' f'cate.? ~=~ n b~ humbetel =-~ R-! ~
Certificate interest Payments shall be payable from the Certifi-
cate Interest Payment Date next preceding the date of registration
6
thereof unless they are registered as of a Certificate Payment
Date, in which event such Certificate Interest Payment shall be
payable from such Certificate Payment Date, or unless the date of
registration thereof is prior to the first Certificate Interest
Payment Date, in which event such Certificate Interest Payment
shall be payable from the Issue Date; provided, however, that if,
as shown by the records of the Trustee, payment of such Certifi-
cate Interest Payment shall be in default, such Certificate Inter-
est Payment represented by Certificates issued in exchange for
such Certificates (surrendered for transfer or exchange) shal~ be
paid from the last date to which such Certificate Interest Payment
has been paid in full or duly provided for, or, if no such Certi-
ficate Interest Payment has been paid or duly provided for, from
the Issue Date. Certificate Interest Payments shall be paid on
each Certificate Payment Date, provided that if any Certificate
Payment Date is not a Business Day, the interest represented by
such Certificate Interest Payment shall cease to accrue on the
date scheduled for payment but shall be paid on the next succeed-
ing Business Day. Payment of such Certificate Interest Payment
shall be made to the person appearing on the Certificate Register
as the Owner thereof on the Record Date, such Certificate Interest
Payment to be paid to such Owner, by check or draft mailed on the
Certificate Payment Date to such Owner's address as it appears on
the Certificate Register on the Record Date or at such other
address as has been furnished to the Registrar ihwriting by such
Owner five Business Days prior to the Record Date; except, in each
case, that, if and to the extent that there shall be a default in
the payment of such Certificate Interest Payment, if any, due on
such Certificate Payment Date, such defaulted Certificate Interest
Payment shall be paid to the Owners in whose name any such
Certificates are registered at the close of business on the
Business Day next preceding the date of payment of such defaulted
Certificate Interest Payment.
(d) The Certificate Interest Payments shall be computed upon
the basis of a 360-day year, consisting of twelve 30-day months.
(e) The Certificate Principal Payments (whether at maturity
or upon redemption or acceleration, shall be payable to the Owners
of such Certificates, upon presentation and surrender of such
Certificates at the Principal Office of the Trustee.
(f) Payment Of Certificate Principal Payments, Certificate
Interest Payments and of the Redemption Price of Certificates
shall be made in such coin or currency of the United States of
America as, at the respective time of payment, shall be legal
tender for public and private debts.
(g) The Certificate Principal Payments shall be subject to
redemption as provided in Article IV hereof. Redemption of Certi-
ficates, other than mandatory sinking fund redemption and other
t~ ~"~.~ant to the ~]~-~t!o~ of ~ef!nndin~ bond Droceedsl shall
7
be made only from and to the extent of funds on deposit with the
Trustee hereunder and available for such purpose on the date
notice for prepayment is mailed.
(h) Notwithstanding any provision contained herein, the
Certificate Interest Payments shall never exceed the Maximum
Interest Rate.
Section 2.03 - Interest Rate. The rate of interest applic-
able to each Certificate will be the interest rate as set forth in
Exhibit A hereto with respect to such maturity.
Section 2.04 Serial and Term Certificates. The Trustee
shall execute, authenticate and deliver both Serial Certificates
and Term Certificates; provided, however, the Term Certificates,
if any, shall be subject to mandatory redemption in part as set
forth in Section 4.03 hereof.
Section 2.05 - Form of Certificates. The Certificates and
the form of assignment to appear thereon shall be in substantially
the form set forth in Exhibit B attached hereto and by this refer-
ence incorporated herein, with necessary or appropriate varia-
tions, omissions and insertions as permitted or required hereby.
Section 2.06 Execution of Certificates. All the Certifi-
cates shall, from time to time, be executed on behalf of the
Issuer by, or bear the manual or facsimile signatures of, the
President of the Issuer and its corporate seal (which may be in
facsimile) and attested by the manual or facsimile signature of
the Secretary/Treasurer of the Issuer.
Section 2.07 - Transfer of Certificates. Any Certificates
may be transferred upon the Certificate Register required to be
kept pursuant to the provisions of Section 2.09, by the person in
whose name it is registered, in person or by his duly authorized
attorney, upon surrender of such Certificates for cancellation,
accompanied by delivery of a duly executed written instrument of
transfer in a form approved by the Trustee.
Section 2.08 - Exchange of Certificates. Certificates may be
exchanged at the Principal Office of the Trustee for a like aggre-
gate principal amount of Certificates of other Authorized Denomi-
nations of the same maturity, interest rate and tenor. The
Trustee shall also require the payment by the Owner requesting
such exchange of any tax or other governmental charge required to
be paid with respect to such exchange.
Except when necessary pursuant to Section 5.03.2(e) hereof,
no exchange of any Certificate shall be required of the Trustee
after such Certificate has been called for optional or mandatory
redemption, and no transfer of any Certificate shall be required
b=,~,'ee~ -n'.' Pecor.~ ~t.= =~fi ~ r~le\,a~t Certificate Payment
DaLe.
8
Section 2.09 - Registration Books. The Registrar will keep
Or cause to be kept at its Principal Offices, sufficient books for
the registration and transfer of the Certificates, which shall at
all reasonable times be open to inspection by the Issuer and the
Lessee, and, upon presentation for such purpose, the Registrar
shall, under such reasonable regulations as it may prescribe,
register or transfer or cause to be registered or transferred, on
said books, Certificates as hereinbefore provided.
[Except as provided in Section 3.04 hereof, t][T]he perso~ in
whose name any Certificate shall be registered on the applicable
Record Date shall be deemed the Owner thereof for all purposes
hereof, and payment of or on account of the Certificate Principal
Payments or Certificate Interest Payments represented by such
Certificates shall be made only to or upon the order in writing of
such registered Owner.
Section 2.10 - Temporary Certificates. The Certificates may
be initially issued in temporary form exchangeable for definitive
Certificates when ready for delivery. The temporary Certificates
may be printed, lithographed or typewritten, shall be of such
denominations as may be determined by the Trustee, shall be in
registered form without coupons and may contain such reference to
any of the provisions of this Trust Indenture as may be
appropriate. Every temporary Certificate shall be executed by the
Trustee upon the same conditions and in substantially the same
manner as the definitive fully registered Certificates. If the
Trustee issues temporary Certificates it will execute and furnish
definitive Certificates without delay, and thereupon the temporary
Certificates may be surrendered, for cancellation, in exchange
therefor at the Trustee's Principal Office and the Trustee shall
deliver in exchange for such temporary Certificates an equal
aggregate principal amount of definitive Certificates of the same
maturity or maturities. Until so exchanged, the temporary
Certificates shall be entitled to the same benefits under this
Trust Indenture as definitive Certificates executed and delivered
hereunder.
Section 2.11 - Certificates Mutilated, Lost, Destroyed or
Stolen. If any Certificate shall become mutilated, the Trustee,
at the expense of the Owner of said Certificate, shall execute and
deliver a new Certificate of like tenor, maturity, interest rate
and number in exchange and substitution for the Certificate so
mutilated (except that such number may be preceded by a distin-
guishing prefix), but only upon surrender to the Trustee of the
Certificate so mutilated. Every mutilated Certificate so surren-
dered to the Trustee shall be canceled by it and destroyed. If
any Certificate shall be lost, destroyed or stolen, evidence of
such loss, destruction or theft may be submitted to the Trustee,
and, if such evidence is satisfactory to the Trustee and indemnity
satisfactory to the Trustee shall be given, the Trustee, at the
a new Certificate of like tenor, maturity, interest rate and
9
received by the Issuer from the sale of the Certificates until
applied as provided herein, and the income earned by the invest-
ment of funds under this Trust Indenture to the extent provided in
this Trust Indenture for the security of the Certificates. All
Certificates issued and to be issued hereunder are, and are to be,
to the extent provided in this Trust Indenture, equally and
ratably secured by this Trust Indenture without preference, prior-
ity or distinction on account of the actual time or times of the
authentication or delivery of the Certificates or any of them, so
that, except as is or may hereafter be provided in this Tr~st
Indenture or as may be limitedby law, all Certificates appertain-
ing thereto any time outstanding heceunder shall have the same
right, lien and preference under and by virtue of this Trust
Indenture and shall all be equally and ratably secured hereby with
like effect as if they had all been executed, authenticated and
delivered simultaneously On the date hereof, whether they or any
of them shall actually be issued on such date, shall be issued on
some future date, shall have been authorized to be authenticated
and delivered under Section 2.16 or may be authorized to be
authenticated and delivered hereafter pursuant to Sections 2.07,
2.08, 2.10 and 2.11 of this Trust Indenture.
Section 2.16 - Authentication and Delivery of Certificates.
The Certificates in an aggregate principal amount of $ ,
shall be executed by the Issuer and delivered to the Trustee for
authentication, authenticated by the Trustee, and delivered to or
upon the written order of the President of the Issuer or other
Authorized Representative of Issuer, but only upon the receipt by
the Trustee of the Proceeds of the sale of the Certificates.
Prior to authentication and delivery of any Certificates, the
Trustee shall also have received the following:
(a) a copy of the resolution or resolutions adopted by.the
Issuer authorizing the execution and delivery of the Lease Pur-
chase Agreement, the other Certificate Documents and this Trust
Indenture and the issuance and delivery of the Certificates, cer-
tified by the Secretary/Treasurer or any Assistant Secretary/
Treasurer of the Issuer under its corporate seal to have been duly
adopted by the Issuer and to be in full force and effect on the
date of such certification;
(b) a copy of the resolution or resolutions adopted by the
Lessee authorizing the execution and delivery of the Lease Pur-
chase Agreement and this Trust Indenture and approving of the
creation of the Issuer and of the issuance of the Certificates,
certified by the City Clerk to be in full force and effect on the
date of such certification;
(c) a copy of the Articles of Incorporation together with
any amendments thereto, of the Issuer, certified by the Secretary
of State of the State of Florida to be true and correct copies of
State;
11
number as the Trustee shall determine in lieu of and in substitu-
tion for the Certificate so lost, destroyed or stolen. The
Trustee may require payment of a sum not exceeding the actual cost
of preparing each new Certificate issued' under this Section 2.11
and of the expenses which may be incurred by the Trustee under
this Section 2.11. Any Certificate issued under the provisions of
this Section 2.11 in lieu of any Certificate alleged to be lost,
destroyed or stolen shall be equally and proportionately entitled
to the benefits of this Trust Indenture with all other Certifi-
cates, secured by this Trust Indenture. The Trustee shall not be
required to treat both the original Certificate and any replace-
ment Certificate as being Outstanding for the purpose of deter-
mining the principal amount of Certificates which may be issued
hereunder or for the purpose of determining any percentage of
Certificates Outstanding hereunder, but both the original and
replacement Certificate shall be treated as one and the same.
Notwithstanding any other provision of this Section 2.11, in lieu
of delivering a new Certificate for a Certificate which has been
mutilated, lost, destroyed or stolen and which has matured, the
Trustee may make payment of such Certificate.
Section 2.12 - Qualification for Depository Trust Company.
The Trustee and Paying Agent are hereby authorized if so provided
in the Certificate Purchase Contract to take such actions as may
be necessary from time to time to qualify the Certificates for
registration in the name of Cede & Co., as nominee for The Deposi-
tory Trust Company. No such arrangements with The Depository
Trust Company may adversely effect the interests of any of the
Owners of the Certificates; provided, however, that the Trustee
and the Paying Agent shall not be liable with respect to any such
arrangements it may make pursuant to this Section 2.12.
Section 2.13 - Insurance. The Trustee shall maintain such
insurance, including postal insurance (by master or blanket cover-
age or otherwise), to cover a Certificate transmitted by mail, as
it shall deem appropriate in order to protect against loss.
Section 2.14 - Transfer Fees. There shall not be any charge
by the Trustee for the transfer of any Certificate except as pro-
vided in Section 2.08 hereof.
Section 2.15 Limitation of Principal Amount of Certifi-
cates; Certificates Secured. The aggregate principal amount of
Certificates which may be executed by the Issuer and authenticated
by the Trustee and delivered and secured by this Trust Indenture
is limited as provided in Section 2.01 of this Trust Indenture and
as may be limited by law.
This Trust Indenture creates and shall be and constitute a
continuing, irrevocable and exclusive lien upon and pledge of all
of the Issuer's right, title and interest in and to the payments
10
(d) a certificate signed on behalf of the Lessee by the
Financial Officer stating that to the best of his knowledge there
is no litigation pending or threatened to restrain or enjoin the
leasing of the Project pursuant to the Lease Purchase Agreement
the collection and application of Lease Purchase Rent in accor-
dance with the provisions thereof;
(e) an opinion of counsel to the Issuer stating that the
Issuer is not in default or breach of any indenture, contract oc
agreement to which the Issuer is a party or by which it
assets are bound;
(f) an opinion of Special Counsel addressed to the Issuerto
the effect that the Certificates are legal, valid, and binding
obligations of the Issuer and that the interest thereon
excluded from gross income of the recipients thereof and is not an
item of tax preference fo~ purposes of the federal alternative
minimum tax on individuals and corporations;
(g) a written order by the President or other Authorized
Representative of the Issuer requesting and authorizing the
Trustee on behalf of the Issuer to authenticate and deliver the
Certificates upon payment to the Trustee of the sum specified
therein as the purchase price for the Certificates;
(h) The Title Insurance Commitment providing for issuance of
the Title Insurance Policy insuring the leasehold estate in and to
the Land in the Issuer and the Trustee, as owner and mortgagee,
respectively; [and]
(i) [such certificates, instruments and documents as are set
forth in or required by Section 20.4 of the Lease Purchase
Agreement; and
(j)] such other instruments as the Trustee may reasonably
request.
12
ARTICLE III
SPECIAL PROVISIONS WITH RESPECT TO MBIA
[To Be Provided]
13
~RTICLE IV
REDEMPT ION
Section 4.01 - Redemption of Certificates; General. The
Certificates are subject to redemption pursuant to the provisions
of this Article IV to the extent that the Lessee is entitled or
required to make and does make a prepayment of the Basic Rent
under the Lease Purchase Agreement, together with premiums,, if
any, and accrued interest thereon.
Section 4.02 - Optional Redemption. The Certificate Princi-
pal Payments are sub3ect to Optional Redemption in whole or in
part on any Certificate interest Payment Date on or after
1, (an "Event of Optional Redemption"). The moneys consti-
tuting such Optional Redemption, including the Premium Portion, if
any, must be deposited w~th the Trustee not less than thirty (30)
days prior to such date of redemption. The Premium Portion
applicable to such redemption is as follows expressed as a percen-
tage ofthe principal amount to be redeemed:
Redemption Date
(both dates inclusive) Premium
1, 31,
1, 31,
1, 31,
1, 31,
1, 31,
1, and thereafter None
Section 4.02.1 - Event of Special Optional Redemption.
In the event that following an Event of Default hereunder, MBIA
directs the Trustee to dispose of the Project pursuant to Section
10.03 hereof and the Net Proceeds of sale are insufficient
(together with the moneys then held by the Trustee in the Funds
hereunder) to pay the Certificate Principal Payments, together
with accrued interest thereon th[ough the date of such redemption,
on all of the Outstanding Certificates. MBIA shall have the right
to direct the Trustee to give notice to Certificate Owners of an
"Event of Special Optional Redemption." Upon being directed to do
so, the Trustee shall give immediate written notice, effective
immediately, to the Certificate Owners pursuant to Section 4.06
hereof and the Outstanding Certificates shall each be redeemed in
part, without premium or penalty, in accordance with Section
4.04.2 hereof.
Section 4.03 ~ Mandatory Redemption; Term Certificates. Term
Certificates maturing on 1, , are subject to manda-
tory redemption prior to maturity in part, by lot in such manner
14
fund on each 1 in the years and in the following amounts
set forth below at the Redemption Price:
· Certificate Principal
1 of the year Payment Amount
(maturity)
Section 4.03.1 - Events of Extraordinary Redemption.
(a)(i) If an Event of Default has occurred hereunder or if all of
the Project is lost, destroyed or damaged in its entirety due to
casualty or condemnation and the Lessee elects not to repair,
replace or restore same as provided in Section 15(b) of the Lease
Purchase Agreement: ah "Event Of Extraordinary Redemption in
Whole" shall be deemed to have occurred; and
(ii) if a portion of the Project is lost, destroyed or
damaged due to casualty Or condemnation and the Lessee elects not
to repaiF, replace or restore same as provided in Section 15(b) of
the Lease Purchase Agreement; O~ moneys on deposit in the Project
Fund are required to be used fo~ prepayment of Certificate Princi-
pal Payments pursuant to Section 5.04.3 hereof and Section 16.2 of
the Lease Purchase Agreement: an "Event of Extraordinary Redemp-
tion in Part" shall be deemed to have occurred.
Upon the occurrence of (x) an Event of Extraordinary Redemp-
tion in Whole, all Outstanding Certificates or (y) an Event of
Extraordinary Redemption in Part, a portion of the Outstanding
Certificates, the portion thereof being determined in accordance
with paragraph (b) of this Section 4.03.1 hereof, shall be subject
to mandatory redemption on any date following notice given as
provided herein. The Redemption Date with respect to such a
redemption shall be within fifteen (15) days after issuing such
notice.
(b) With respect to an Event of Extraordinary Redemption in
Part, Certificates representing aggregate Certificate Principal
Payments equal in amount to the aggregate outstanding Basic Rent
beilng prepaid under the Lease Purchase Agreement shall be paid.
The amount of Certificate Principal Payments represented by Out-
standing Certificates of each Certificate Principal Payment Date
to be so redeemed shall equal the amount of aggregate Basic Rent
due under the Lease Purchase Agreement with respect to such Certi-
ficate Principal Payment Date. If less than all of the Out-
standing Certificates due on a Certificate Principal Payment Date
a~e to be mandatorily redeemed, the Trustee shall select the Cer-
tificates or any portion thereof to be redeemed pursuant to
15
4.03.2 - Event of Special Mandatory Redemption. In the
event that following an Event of Default hereunder, MBIA directs
the Trustee to dispose of the Project pursuant to Section 10.03
hereof and the Net Proceeds of sale are sufficient (together with
the moneys then held by the Trustee in the Funds hereunder) to pay
the Certificate Principal Payments, together with accrued interest
thereon through the date of such redemption, on the Outstanding
Certificates, the Trustee shall give immediate written notice,
effective immediately, to Certificate Owners of an "Event of Spe-
cial Mandatory Redemption" pursuant to Section 4.06 hereof and .the
Outstanding Certificates shall be redeemed in whole, without pre-
mium or penalty.
Section 4.04 - Selection of Certificates for Redemption.
4.04.1 - Selection by Lot. If less than all of the
Certificates (or less than all of the Certificates with the same
Certificate Maturity Date) are to be called for redemption (other
than as a result Of an Event Of Special Optional Redemption), the
Trustee shall select the Certificates, or any given portion
thereof to be redeemed, from Outstanding Certificates not thereto-
fore designated for such redemption, by lot per minimum Authorized
Denomination within each Certificate Maturity Date. The Trustee
shall pr6mptly notify the Issuer and the Lessee in writing of the
numbers of the Certificates or portions thereof so selected for
redemption.
4.04.2 - Selection of Certificates for Redemption under
Section 4.02.1. Upon the occurrence of an Event of Special
Optional Redemption, each Outstanding Certificate shall be
redeemed proportionately in part (without regard to Certificate
Maturity Date) in the relative proportion that (a) the amount of
the unpaid Certificate Principal Payments represented thereby
bears to (b) the aggregate amount of the unpaid Certificate Prin-
cipal Payments represented by all the Outstanding Certificates.
Section 4.05 - Partial Redemption of Certificates. Upon
surrender of any Certificate redeemed in part only, the Trustee
shall execute and deliver to the Owner thereof, a new Certificate
or Certificates of Authorized Denominations, and of the same Cer-
tificate Maturity Date equal in an aggregate principal amount to
the unredeemed portion of the Certificate surrendered.
Section 4.06 - Notice of Redemption. (a) Unless otherwise
provided herein, notice of redemption shall be given by the
Trustee, (i) not more than forty-five (45) days and not less than
thirty (30) days prior to the Redemption Date with respect to
Optional Redemption, (ii) upon being notified of the basis for
same, the Trustee shall give written notice of redemption fifteen
(15) days prior to the Redemption Date with respect to Events of
Extraordinary Redemption and (iii) upon receiving the Net Proceeds
^= c~.~. ~h~l! ~ive written notice effective ~mmediatel~ or an
16
Owner of each Certificate affected at the address shown on the
Certificate Register maintained by the Registrar on the date such
notice is mailed. Each notice of redemption shall state the
Redemption Date, the place of redemption, the Redemption Price
and, if less than all, the distinctive numbers of the Certificates
to be redeemed, and shall also state that the Certificate Interest
Payments represented by euch Certificates designated for redemp-
tion shall cease to accrue from and after such Redemption Date and
that on said date there will become due and payable for each of
said Certificates the Redemption Price.
(b) In addition to the mailing of the notice described above,
each notice of redemption and payment of the Redemption Price
shall meet the following requirements; provided, however, that
failure of such notice of redemption to comply with the terms of
this paragraph shall not in any manner defeat the effectiveness of
a call for redemption if notice thereof is given as prescribed
above,
(i) Each further notice of redemption shall contain the
information required above for an official notice of redemp-
tion plus (A) the CUSIP numbers of all Certificates being
prepaid; (B) the date of issue of the Certificates as origi-
nall'y issued; (C) the rate of interest borne by each Certifi-
cate being redeemed: (D) the Certificate Maturity Date of
each Certificate being redeemed; (E) the publication date of
the official notice of redemption; (F) the name and address
of the Registrar/Paying Agent; and (G) any other descriptive
information needed to identify accurately the Certificates
being redeemed.
(ii) Each further notice of redemption shall be sent at
least thirty-five (35) days before the Redemption Date by
certified mail or overnight delivery service or telecopy to
all registered securities depositories then in the business
of holding substantial amounts of obligations of types com-
prising the Certificates (such depositories now being The
Depository Trust Company, New York, New York; Midwest Securi-
ties Trust Company, Chicago, Illinois; Pacific Securities
Depository Trust Company, San Francisco, California; and
Philadelphia Depository Trust Company, Philadelphia,
Pennsylvania, and to one or more national information ser-
vices which disseminate notices of redemption of obligations
such as the Certificates.
(iii) Each further notice of redemption 'shall be published
one time in a Financial Newspaper or journal, or, if such
publication is impractical or unlikely to reach a substantial
number of the Certificate Owners, in some other financial
newspaper or journal which regularly carries notices of
redemption of other obligations similar to the Certificates,
17
(iv) Upon the payment of the Redemption Price of Certifi-
cates being redeemed each check or other transfer of funds
issued for such purpose shall bear the CUSIP number identify-
ing, by issue and maturity, the Certificates redeemed with
the proceeds of such check or other transfer.
Section 4.07 - Effect Of Redemption. Notice of redemption
having been duly given as aforesaid, and moneys for payment of the
Redemption Price of such Certificates (or portions thereof) being
held by the Trustee, On the Redemption Date designated in such
notice, the Certificates (or portions thereof) so called for
redemption shall become due and payable at the Redemption Price
specified in such notice and the Certificate Interest Payments
represented by such Certificates so called for redemption shall
cease to accrue, said Certificates (or portions thereof) shall
cease to be entitled to any benefit or security under this Trust
Indenture, and the Owners of said Certificates shall have no
rights in respect thereof except to receive payment of said
Redemption Price.
All Certificates redeemed pursuant to the provisions of this
Article IV shall be cancelled upon surrender thereof and destroyed
by the Trustee.
18
(a) The Basic Rent Payments under the Lease Purchase
Agreement shall be deposited to the Rent Payment Fund.
(b) Prepayments of Basic Rent pursuant tO Section 16.3
of the Lease Purchase Agreement shall be deposited to the Rent
Payment Fund.
(c) Optional prepayments of Basic Rent Payments pursuant
to Section 17.1 of the Lease Purchase A~reement (including payment
of the Option Price) shall be deposited to the Optional Redemption
Fund.
(d) The Premium Portion, if any, of the optional prepay-
men~s of the Basic Rent Payments under the Lease Purchase Agree-
ment (including payment of the Option Price) shall be deposited to
the Optional Redemption Fund.
(e) The prepayments of Basic Rent Payments under SectiOn
16.2 of the Lease Purchase Agreement shall be deposited to the
Extraordinary Redemption Fund.
(f) In the event that:
(i) a deposit of additional funds by the Lessee is
required pursuant to Section 3.2 of the Lease PurchaSe Agree-
ment, upon receipt of such moneys, the Trustee shall deposit
same to the credit of the Acquisition Account in the Project
Fund; or
(ii) a deposit of Net Proceeds of insurance or a
condemnation award is required pursuant to Section 15(a) of
the Lease Purchase Agreement, same (together with any addi-
tional moneys thereby required to be deposited hereunder)
shall be deposited by the Trustee, upon receipt, to the
credit of the Acquisition Account in the Project Fund and
disbursed pursuant to Section 6.02.2.
(g) In the event that a deposit of funds is required by
the Lessee due to a Reserve Deficiency, upon receipt of such
moneys the Trustee shall deposit same to the credit of the Reserve
Fund.
(h) In the event that any moneys are paid by the Lessee
to the Trustee for reimbursement to MBIA under Section [3,01],
hereof, upon receipt of such moneys, the Trustee shall remit same
to MBIA.
(i) In the event that a deposit of funds is required by
the Lessee in the Rebate Account, upon receipt of such moneys the
Trustee shall deposit same to the credit of the Rebate Account.
(=~ ~" other cuo~7~menta]. ~e~t Teceived bk- the Trustee
the Lessee created by the Trustee for such purpose and shall be
20
ARTICLE V
THE FUNDS; APPLICATION OF
PROCEEDS AND LEASE PURCHASE'REVENUES
Section 5.01 - Creation of Funds. On the Issue Date and
simultaneously with the initial execution, authentication and
delivery of the Certificates hereunder the Trustee shall create
the following funds and accounts:
(a) A special fund shall be created and established with the
Trustee, to be designated the "City of Sanford, Florida Project
Fund" which shall be the Project Fund. The Trustee shall create
three accounts within the Project Fund: "Acquisition Account,"
"Costs of Issuance Account" and "Capitalized Interest Account."
(b) A special fund shall be created and established with the
Trustee, to be designated the "City of Sanford, Florida Rent Pay-
ment Fund" which shall be the Rent Payment Fund.
(c) A special fund shall be created and established with the
Trustee,.to be designated the "City of Sanford, Florida Optional
Redemption Fund" which shall be the Optional Redemption Fund.
(d) A special fund shall be created and established with the
Trustee to be designated the "City of Sanford, Florida Extraordi-
nary Redemption Fund" which shall be the Extraordinary Redemption
Fund.
(e) A special fund shall be created and established with the
Trustee, to be designated the "City of Sanford, Florida Reserve
Fund" which shall be the Reserve Fund.
(f) A special fund shall be created and established with the
Trustee, to be designated the "City of Sanford, Florida Special
Redemption Fund" which shall be the Special Redemption Fund.
All funds and accounts established pursuant to this Article V
shall be held by the Trustee in accordance with Article II hereof
and applied as hereinafter provided.
Section 5.02 - Application of Proceeds of Certificates. The
Proceeds received from the sale of the Certificates shall be
deposited in trust with the Trustee who shall forthwith deposit
such Proceeds in accordance with Exhibit A hereto.
Section 5.03 - Deposits to Funds.
Section 5.03.1 - Deposit of Lease Purchase Revenues.
Basic Rent Payments under the Lease Purchase Agreement and other
'trustee as follows:
19
held in trust hereunder for the benefit of the Person entitled to
receive same pending application thereof for the purpose for which
same were made.
(k) The Net Proceeds of sale of the Project, upon a
disposition thereof pursuant to Section 10.03 hereof, and, upon
receipt of such moneys, all other moneys held in the funds by the
Trustee hereunder, shall be deposited to the Special Redemption
Fund.
SectiOn 5.03.2 Deposits to Rent Payment Fund; Pay-
ments Under the Municipal Bond Insurance Policy. So long as the
Municipal Bond InsuranCe Policy shall be in full force and effect,
the Trustee (and pursuant to [section 20(c) of] the Lease Purchase
Agreement the Lessee has agreed) hereby agrees to comply with the
following provisions:
(a) the gross amount to be deposited to the Rent Payment
Fund shall be on deposit at least five (5) Business Days prior to
such Certificate Payment Date;
(b) if, on the fifth day (or if the fifth day is not a
Business Day, then on the Business Day next preceding the fifth
day) pri6r to a Certificate Payment Date the Trustee determines
that there wilF'~'~'insufficlent funds in the funds and accounts
available to pay the Certificate Principal Payment or Certificate
Interest Payment represented by the Certificates (including the
Reserve Fund) on such Certificate Payment Date, the Trustee shall
immediately notify MBIA. Such notice shall be by telephone,
promptly confirmed in writing, and shall specify the amount of the
anticipated deficiency, the Certificates to which such deficiency
will be applicable and whether payment due on such Certificates
will be deficient as to principal Or interest, Or both;
(c) the Trustee shall, after giving notice to MBIA as
provided in clause (b) of this Section 5.03.2, make available to
MBIA and as insurance trustee for MBIA (the
"Insurance Trustee"), the Certificate Register maintained by the
Trustee, and all records relating to the funds and accounts esta-
blished under this Trust Indenture;
(d) the Trustee shall provide MBIA and the Insurance
Trustee with a list of the names and addresses of Certificate
Owners entitled to receive principal or interest payments from
MBIA under the terms of the Municipal Bond Insurance Policy, and
shall make arrangements with the Insurance Trustee (i) to mail
checks or drafts to the Certificate Owners entitled to receive
full or partial interest payments from MBIA, and (ii) to pay prin-
cipal due on the Certificates once such Certificates ace sur-
rendered to the Insurance Trustee by the Certificate Owners
entitled to full or partial Certificate Principal Payments from
21
(e) the Trustee shall, at the time it provides notice to
MBIA pursuant to (b) above, notify Owners entitled to receive
principal Or interest payments from MBIA (i) as to the fact of
such entitlement, (ii) that MBIA will remit all or a portion of
the Certificate Interest Payments next coming due, (iii) that if
entitled to receive full payment of principal from MBIA such
Owners must tender their Certificates (together with a form of
transfer of title thereto) for payment to the Insurance Trustee
and not to the Trustee and (iv) that if entitled to receive par-
tial payment of principal from MBIA such Owners must tender tl%eir
Certificates fo~ payment thereof first to the Trustee, who (if
such Certificate is due in part, shall first comply with Section
4.05 hereof) shall note on such Certificates the portion of the
principal paid by the Trustee, and thereafter, together with a
form of transfer of title thereto, to the Insurance Trustee.
After such Certificates and instruments transferring title thereto
have been tendered to the Insurance Trustee, MBIA will pay the
unpaid portion of principal then due;
(f) For purposes of this Section 5.03.2, "Business Day"
shall mean any day other than a Saturday, Sunday or a day on which
the Insurance Trustee is authorized by law to remain closed; and
(g) In the event MBIA is to make any payment of Certifi-
cate Principal Payments or Certificate Interest Payments, and the
Certificates are registered through the facilities of a securities
depository arrangement, or a book-entry system, the Lessee and the
Trustee shall, at MBIA's direction, discontinue such book-entry
system and shall cause the Certificates to be registered in the
names of the beneficial owners for purposes of all further
payments.
Section 5.04 - Rent Payment Fund.
Section 5.04.1 - Application of Rent Payment Fund. All
amounts in the Rent Payment Fund shall be used and withdrawn by
the Trustee solely to pay the Certificate Payments represented by
the Certificates when due and payable and the Principal Portion of
the Redemption Price of Term Certificates to be prepaid pursuant
to Section 4.03 hereof (including accrued interest with respect to
any Certificates accelerated or redeemed prior to maturity pursu-
ant to this Trust Indenture). On each Certificate Principal Pay-
ment Date and each Certificate Interest Payment Date, an amount
equal to the Basic Rent Payments due under the Lease Purchase
Agreement shall be disbursed from the Rent Payment Fund for such
purpose. In the event there are insufficient funds in the Rent
Payment Fund to make such payment, the Trustee shall transfer an
'aMount equal to such deficiency from the Reserve Fund (to the
extent of the moneys therein) and, if such moneys are insuffi-
cient, then (to the extent on deposit in the Acquisition Account)
from the Acquisition Account to the Rent Payment Fund and apply
22
Section 5.04.2 - Deposits to Rebate Account. Deposits
to the Rebate Account from earnings on moneys on deposit in the
Rent Payment Fund shall be made when required in accordance with
Article VIII hereof.
Section 5.04.3 - Credit to Lessee. So long as no Event
Of Lease Default has occurred under the Lease Purchase Agreement
and no event has occurred which with the giving of notice or the
lapse of time or both would constitute an Event of Lease Default
thereunder, not less than ten (10) Business Days prior to each
Basic Rent Payment Date, the Trustee shall notify the Lessee of
the balance, if any, in the Rent Payment Fund and the Lessee may
treat such amount as a credit against its next ensuing Basic Rent
Payment and reduce the amount thereof accordingly.
Section 5.04.4 - Closing of Rent Payment Fund. Upon
payment of all the Outstanding Certificates or upon transfer of
all the funds in the Rent Payment Fund to the Extraordinary
Redemption Fund upon an acceleration of all the Certificates in
accordance with Section 10.02 hereof, THE RENT PAYMENT FUND SMALL
BE CLOSED AND, AFTER PAYMENT OF ALL AMOUNTS DUE OR ACCRUED HERE-
UNDER ON THE OUTSTANDING CERTIFICATES, THE BALANCE, IF ANY, IN THE
RENT P~YMENT FUND SHALL BE DISBURSED TO THE LESSEE AND MAY BE
SPENT FO~ ANY LAWFUL PURPOSE.
Section 5.05 - Application of Optional Redemption Fund. Any
amounts received by the Trustee with respect to a prepayment of
Basic Rent under the Lease Purchase Agreement shall be deposited
to the Optional Redemption Fund in accordance with Section
5.03.1(c) and (d) hereof. All amounts deposited in such Optional
Redemption Fund shall be used and withdrawn by the Trustee
solely:
(i) to prepay the Certificate Principal Payments and to
pay the Certificate Interest Payments represented by the
Redemption Price of the Certificates paid to the Owners of
Certificates pursuant to Article IV hereof; and
(ii) to pay the Premium Portion, if any, of the Redemp-
tion Price in conjunction with such an optional redemption to
the Owners of the Certificates being redeemed.
On each such optional Redemption Date an amount equal to the
Basic Rent Payments being prepaid under the Lease Purchase Agree-
ment shall be disbursed for such purpose by the Trustee from the
Optional Redemption Fund.
-. Section 5.06 - A plication of Extraordinary Redemption Fund.
Any amounts received ~y the Trustee with respect to a Event of
Mandatory Prepayment under the Lease Purchase Agreement or with
respect to an Event of Extraordinary Redemption in Whole or an
23
deposited to the Extraordinary Redemption Fund in accordance with
Section 5.03.1(e) hereof. All amounts deposited in the Extraordi-
nary Redemption Fund shall be used and Withdrawn by the Trustee
solely to prepay the Certificate Principal Payment and the Certi-
ficate Interest Payment represented by the Redemption Price of the
Certificates paid to the Owners of Certificates pursuant to
Article IV hereof.
On each such mandatory Redemption Date an amount equal to
such Redemption Price shall be disbursed for such purpose by ,the
Trustee from the Extraordinary Redemption Fund.
Section 5.07 - Reserve Fund. (a) On the Issue Date, the
Trustee shall deposit an amount equal to the Reserve Requirement
to the Reserve Fund in accordance with Exhibit A hereto.
(b) The moneys On deposit in the Reserve Fund shall be
applied pursuant to Section 5.04.1 hereof.
(c) In the event that at any time during the Lease Term there
is a Reserve Deficiency, the Lessee shall replenish such Reserve
Fund in accordance with Section 2.7.2 of the Lease Purchase
Agreement.
Section 5.08 - Application Of Special Redemption Fund. All
Net Proceeds of sale of the Project upon a disposition thereof
pursuant to Section 10.03 hereof and, upon receipt thereof, all
moneys held in the Funds by the Trustee hereunder, shall be depo-
sited to the Special Redemption Fund in accordance with Section
5.03.1(k) hereof. All amounts deposited in the Special Redemption
Fund shall be used and withdrawn by the Trustee solely to prepay
the Certificate Principal Payments and interest accrued thereon to
the Redemption Date in accordance with either Section 4.02.t or
4.03.2 hereof, as applicable.
Section 5.09 - No Commingling. The moneys credited to any
Fund shall not be commingled with any Other moneys held by the
Trustee under this Trust Indenture or any other moneys held by the
Trustee in any other capacity.
24
ARTICLE VI
THE PROJECT FUND
The Project Fund shall be held by and distributed by the
Trustee in accordance with the terms of this Trust Indenture. The
earnings On moneys on deposit in any account within the Project
Fund shall remain in such account in such Project Fund until such
account is closed and when the last account within such Pro~ect
Fund is to be closed, any such earnings remaining therein shall be
disbursed pursuant to Section 6.03 hereof. With respect to each
of the accounts in such Project Fund, the Trustee shall separately
account for the Original amount deposited and for the earnings on
such account.
Section 6.01 - Payment of Item Purchase Price and of the
Costs of Issuance.
(a) Upon receipt of the Proceeds, the Trustee shall make
payment from the Costs of Issuance Account of the Costs of Issu-
ance in accordance with written instructions from the Issuer and
consented to by the Lessee. Any moneys remaining in the Costs of
Issuance'Account ninety (90) days after the Issue Date shall be
transferred to the Acquisition Account. -
(b) The Trustee shall make payment to the Vendor for each
item of Equipment constituting a portion of the Project in the
amount of the Item Purchase Price therefor from the Acquisition
Account of the Project Fund by issuance to the party to be paid of
a draft payable to such Vendor upon acceptance of such item of
Equipment, but. only upon receipt of a completed Requisition in the
form of Exhibit A to the Lease Purchase Agreement.
The Trustee may rely upon the certification of the Lessee in
the Requisition or in any documents, certificates or instruments
submitted in connection therewith as to the factual conditions
precedent to any disbursements hereunder and shall have no respon-
sibility or duty to review the attachments to such Requisition
(but must determine that all required attachments are in fact
attached) or investigate the basis for such certifications or
representations.
Section 6.02 - Payment of Costs. Payments shall be made by
the Trustee for Costs in accordance with the following:
SeCtion 6.02.1 - Construction Documents. Before the
Trustee is authorized to make any disbursements for the construc-
tion of the Building [(other than pursuant to the Development
Agreement for preconstruction costs and other soft costs associ-
ated with the Project set forth in the Budget which shall be paid
25
after receipt Of a separate Requisition therefor], the Trustee
shall have received from the Lessee the following instruments and
documents relating to the construction of- the Building identified
in subparagraphs (a) through (c) of this Section 6.02.1, all in
form and substance acceptable to the Lessee. The Trustee shall
have no duty to examine any of the construction documents identi-
fied in subparagraphs (a) through (c) of this Section 6.02.1 and
shall be entitled to rely solely upon the Requisition executed by
the Lessee as confirmation that all conditions precedent to .the
payments authorized by such Requisition have been fulfilled.
(a) Final Site Plan and Plans and Specifications. A
final site plan for the Building (the "Site Plan") and one com-
plete set of detailed, final plans and specifications (the "Plans
and Specifications"), for the construction of the Building. [The
Plans and Specifications must also have been acceptable in all
respects to MBIA.]
(b) Budget and Disbursement Schedule. The Budget, con-
sisting of a detailed cost breakdown for the costs of constructing
the Project and an estimated disbursement schedule acceptable in
all respects to the Lessee, a copy of which Budget is attached to
the Lease' Purchase Agre~t~as Exhibit D.
(c) Title Insurance. The Title Insurance Policy issued
pursuant to the Title Insurance Commitment.
Section 6.02.2 - Payment of Costs. So long as, to the
Trustee's knowledge, the Lessee is not in default under the Lease
Purchase Agreement and the conditions set forth in Sections 6.02.1
and 6.02.2(b) hereof have been satisfied, the Trustee shall make
disbursements of Costs for the Project from the Acquisition
Account to the Lessee or to persons designated by the Lessee in a
Requisition or to reimburse the Lessee for such costs already paid
by it and identified in a Requisition for the construction of the
Project up to the remaining amount in the applicable Acquisition
Account by check or wire transfer upon the request of the Lessee
in accordance with the following provisions:
(a) Requisitions. To request a disbursement for Costs,
subject to the provisions of this Trust Indenture, the Lessee
shall complete, execute and deliver to the Trustee a Requisition
substantially in the form attached as Exhibit A to the Lease Pur-
chase Agreement. The Requisition must include the amount of funds
requested, the date requested and funding instructions and the
Endorsements and all the other required attachments. All attach-
ments to the Requisition must be itemized in the body of the
Requisition. The parties acknowledge that the Trustee, pursuant
to a Directire, may waive any noncompliance with the requirements
of the Lease Purchase Agreement for the disbursement of
Acquisition Account moneys, Also, the Trustee is authorized to
rely upon the Lessee's written approval Of the RequxsiLion w~nout
26
independently confirming compliance with or satisfaction of such
requirements or the requirements set forth in this Trust
Indenture. The T~ustee may also rely upon the certification of
the Lessee in the Requisition or in any documents, certificates or
instruments submitted in connection therewith as to the factual
conditions precedent to any disbursements hereunder and shall have
no responsibility or duty to review the attachments to such
Requisition (but must determine that all required attachments are
present) or investigate the basis for such certifications. or
representations.
(b) Conditions Precedent to Each Disbursement. Unless
directed to do so by MBIA, the Trustee shall not make disburse-
ments from the Acquisition Account if the Trustee has been noti-
fied that any of the following conditions exist:
(i) The Lessee' is in default under the Lease Purchase
Agreement;
(ii) Any portion of the Project is damaged by fire or
other casualty and the Lessee has failed to comply with Sec-
tion 15 of the Lease Purchase Agreement; or
(iii) Any lien is filed against the Project and is not
satisfied or transferred to bond as permitted by Chapter 713,
Florida Statutes.
The parties hereto agree that the Trustee has no obligation
to independently inquire as to, ascertain or determine the exis-
tence or non-existence of such conditions.
(c) Retainage. All Acquisition Account disbursements
for Costs are subject to a retainage of ten percent (10%) which
shall be held by the Trustee until Issuer delivers to Trustee a
Notice of Substantial Completion. Subsequent to the receipt by
the Trustee of the Notice of Substantial Completion, the retainage
shall be such amounts as are computed by Lessee and certified by
the Issuer to the Trustee in writing.
The parties hereto agree that the Trustee has no obligation
to independently inquire as to, ascertain or determine the exis-
tence or non-existence of such conditions.
(d) Notice Frequency. Completed Requisitions shall be
submitted to the Trustee not less than five business days before
the date the disbursement is required. The Trustee shall be obli-
gated to make Acquisition Account disbursements no more frequently
than once monthly.
(e) Advances Do Not Constitute a Waiver. The making of
an~ Acqt!~itinn Account d{.~bur~ement shat] not constitute a waiver
of any of the provisions of this Trust Indennufe, the Lease Pur-
chase Agreement or the Development Agreement.
27
Proje cl the Capitalized Interest Account)
following the Acceptance Expiration Date hereof (i) if such
balance is equal to or in excess of $50,000, an Event of Extraor-
dinary Redemption shall be deemed to have occurred and same shall
be transferred to the Extraordinary Redemption Fund or (ii) if
such balance is less than $50,000, same shall be transferred to
the Rent Payment Fund to be used solely for making payment in part
of the Certificates, and, in either case, the Project Fund (exclu-
sive of the Capitalized Interest Account) shall be closed pursuant
to Section 6.07 hereof.
Section 6.04 - Effect of Event of Mandatory Prepayment. In
the event of an Event of Mandatory Prepayment under Section 16.2
of the Lease Purchase Agreement, the Lessee shall be obligated to
continue making the remaining Basic Rent Payments under the Lease
Purchase Agreement.
Section 6.05 - Acceleration or Redemption of Certificates.
In the event of an acceleration of all the Certificates pursuant
to Section 10.02 hereof or the occurrence of an Event of Extraor-
dinary Redemption in Whole under Section 4.03.1(a)(i) hereof, any
moneys r~maining in the Project Fund shall be transferred and
deposited to the credit of the Rent Payment Fund and the Project
Fund shall be closed pursuant to Section 6.07 hereof.
Section 6.06 -Capitalized Interest Account. (a) The amounts
deposited to the Capitalized Interest Account, if any, shall be
used to make all or a portion of the Certificate Interest Payments
during the period set forth in Exhibit A hereto (each date
inclusive).
(b) The Trustee shall draw from the Capitalized Interest
Account the amounts on the da~e as set forth in Exhibit A hereto
and shall deposit same in the Rent Payment Fund.
Section 6.07 Closing of Project Fund. Immediately after
the disbursement or transfer of the moneys in the Project Fund
pursuant to Sections 6.03 Or 6.05 hereof, all the accounts in the
Project Fund shall be closed; provided, however, that the Trustee
shall reopen such Project Fund whenever it receives Lease Purchase
Revenues under Section 5.03.1(f)(ii) hereof.
Section 6.08 - Default under Lease Purchase Agreement. When
required pursuant to Section 5.04.1 hereof, the Trustee shall
transfer the amount required by such Section from the Acquisition
ACcount to the Rent Payment Fund.
28
~RTICLE VII
ACCEPTANCE; INVESTMENT
Section 7.01 - Acceptance. The Trustee agrees to act as
trustee for the benefit of the Owners of the Certificates, to
receive, hold, invest and disburse the moneys to be paid to the
Trustee pursuant to this Trust Indenture for credit to the various
funds established by this Trust Indenture, to prepare, authenti-
cate and deliver the Certificates, to apply and disburse the pay-
ments received from the Lessee to the Owners of Certificates and
to perform certain other functions, all as hereinafter provided.
The Trustee hereby agrees to receive and disburse the funds depo-
sited into each of the Funds and the Rebate Account with respect
to the Certificates and to prepare, authenticate and deliver the
Certificates, all in accordance with the terms and conditions set
forth herein. All moneys held by the Trustee hereunder shall be
held in bona fide trust accounts and shall not be commingled with
any other moneys held by the Trustee in any other capacity.
Section 7.02 - Investments. Except as provided in Section
7.05 hereof, all moneys held as a part of the Funds shall be
investe~_.and reinvested by the Trustee pursuant to written
instructions from the Issuer and the Lessee' in Qualified Invest-
ments. Moneys held in the Rebate Account shall be invested pursu-
ant to Section 8.07(c) hereof. Investments with respect to the
amounts on deposit in the Project Fund shall be scheduled to
mature at or before the time when the moneys will be needed to pay
disbursements against the Requisitions for costs of acquisition of
the Project in accordance with the Draw Schedule. Investments
with respect to the amounts on deposit in the Rent Payment Fund
shall be scheduled to mature at or before the next Certificate
Payment Date. In the event that the Issuer and the Lessee at any
time or from time to time hereunder are of the opinion that it is
necessary to restrict or limit the yield on the investment of any
moneys paid to or held by the Trustee hereunder in order to avoid
the Certificates being considered "arbitrage bonds" within the
meaning of Sections 103 and 148 of the Code, the Issuer and the
Lessee may issue to the Trustee a written certificate to such
effect (along with appropriate written instructions), in which
event the Trustee immediately will take the action directed in
such certificate to restrict or limit the yield on such investment
in accordance with such certificate and instructions of the Issuer
and the Lessee. Lessee and Issuer each covenants that it shall
take no action nor direct Trustee to make any investment or use of
the moneys held hereunder which would cause the Certificates to be
considered "arbitrage bonds" within the meaning of Sections 103
and 148 of the Code.
Section 7.03 - Earnings. Subject to the provisions Of
Article VIII hereof, interest or income earned ~rom the investment
of moneys in the Project Fund, the Rent Payment Funo, ~he Optional
Redemption Fund, the Extraordinary Redemption Fund and the Special
29
Redemption Fund shall be deposited to the credit.of such Fund and
interest or income earned from the investment of moneys in the
Reserve Fund shall be deposited to the Rent Payment Fund unless
there is a Reserve Deficiency, in which case such interest or
income shall be deposited first to the Reserve Fund but only up to
the amount of such Reserve Deficiency. Interest or income
earnings from the investment of moneys in the Rebate Account shall
be retained in such account and disbursed in accordance with
Article VIII hereof.
Section 7.04 - Method of Valuation and Frequency of Valua-
tion. In computing the amount in any fund or account, Qualified
Investments shall be valued at the lower of the cost or the market
price, exclusive of accrued interest. With respect to all funds
and accounts, except the Reserve Fund, valuation shall occur annu-
ally. The Reserve Fund shall be valued semi-annually, except in
the event of a withdrawal from the Reserve Fund, whereupon it
shall be valued immediately after such withdrawal. If amounts on
deposit in the Reserve Fund shall, at any time, be less than the
applicable Reserve Requirement as a result of a failure by the
Lessee to make any Basic Rent Payments, MBIA shall be notified
immediately of such Reserve Deficiency, and such deficiency shall
be made up immediately from first available moneys after required
deposits 'to the Rent Payment Fund. If amounts on deposit in the
Reserve Fund shall, at any time, be less. than the'applicable
Reserve Requirement despite the timely making of Basic Rent Pay-
ments by the Lessee, MBIA shall be notified immediately of such
Reserve Deficiency, and such deficiency shall be made up from
first available moneys after required deposits to the Rent Payment
Fund (i) over a period of not more than four months, in four (4)
substantially equal payments, in the event such deficiency results
from a decrease of 10% or less in the market value of the Quali-
fied Investments on deposit in the Reserve Fund and (ii) over a
period of not more than twelve (12) months, in twelve (12) sub-
stantially equal payments, in the event such deficiency results
from a decrease of more than 10% in the market value of the Quali-
fied Investments in the Reserve Fund.
Section 7.05 - Investment of Amounts Representing Accrued
Interest and Capitalized Interest. All amounts representing
accrued and capitalized interest shall be held by the Trustee,
pledged solely to the payment of interest on the Certificates and
invested only in Governmental Obligations maturing at such time
and in such amounts as are necessary to match the interest pay-
ments to which they are pledged.
3O
ARTICLE VIII
REBATE ACCOUNT
Section 8.01 - Creation of Rebate Account. On the Issue
Date, the Trustee shall establish a special escrow account desig-
nated as the "City of Sanford, Florida Rebate Account" (the
"Rebate Account").
Section 8.02 Determination of Rebate. Unless the gross
proceeds (as defined in Section 148(f) of the Code) of the Certi-
ficates are spent for the Project before the six month anniversacy
of the Issue Date and such expenditure is confirmed to the Trustee
by the Issuer and the Lessee in a written certificate to such
effect or unless the Issuer and the Lessee receive an opinion of
Special Counsel that the Certificates are otherwise excepted from
the provisions of Sectio~ 148(f) of the Code, then within 15 days
of the anniversary of every Issue Date or the date upon which no
Certificates remain Outstanding, the Trustee shall have prepared
copies of all records concerning investment of Proceeds of the
Certificates and shall have forwarded to the Issuer and the Lessee
the records relating to the Certificates and within 25 days of the
anniversary of each Issue Date or the d~_te of upon which no Certi-
ficates remain Outstanding, the Issuer and the Lessee shall have
provided the Trustee a certificate in form acceptable to the
Trustee of the Rebate Amount (as defined in Section 8.03 hereof)
and then as soon as practicable (but no more than 30 days) after
each annual anniversary of the Issue Date while Certificates are
Outstanding, and within 30 days succeeding the date upon which no
Certificates remain Outstanding (the "Determination Dates"), the
Trustee shall .pursuant to the written direction from the Issuer
and the Lessee (together with a certificate that sufficient moneys
are on desposit in such fund. to allow withdrawal of the amount
indicated and still leave a balance sufficient for the purposes of
the moneys in such Fund) transfer from the Project Fund or the
Rent Payment Fund, or from any other Non-Ad Valorem Revenues as
directed in such notice, to the Rebate Account the Rebate Amount.
Notwithstanding the prior sentence, if gross proceeds actually
become available after the date which is six months after the date
hereof (e.g., through a sale of the Project) then the requirmen=s
described herein relating to the calculation of the Rebate Amount
and %he payment thereof to the United States must be satisfied.
If there are not sufficient moneys in such Funds, the amount
necessary to pay such Rebate Amount shall be deposited with the
Trustee by the Issuer and the Lessee from Non-Ad Valorem Revenues.
If the Lessee does not have Non-Ad Valorem Revenues from which to
make such deposit, the Trustee shall make same from the Project
Fund and second, the Rent Payment Fund notwithstanding the crea-
tion of a deficiency. Earnings on moneys in the Rebate Account
shall on each Determination Date after the first Determination
D~te [emain in the Rebate Account. In the Issuer's and the
31
Lessee's calculation of such Rebate Amount, amounts earned in the
Rent Payment Fund, to the extent such Rent Payment Fund is a bona
fide debt service fund within the meaning of Treasury Regulation
1.103-13(b)(12), shall not be taken into account if the gross
earnings on such fund for each Certificate Year are less than
$100,000.
Section 8.03. - Deposits to Rebate Account. The written
instructions of the Issuer and the Lessee provided to the Trustee
pursuant to Section 8.02 shall direct the Trustee to deposit.the
following sums to the Rebate Account:
The excessof the aggregate amount earned from the Issue Date
by the Issuer or the Lessee On all investments in the Project Fund
and any other fund in which gross proceeds of the Certificates are
held, over the amount that would have been earned in the yield on
such investments had been equal to the yield on Certificates less
any payments previously 'made to the Internal Revenue Service in
accordance with Section 8.04 hereof (the "Rebate Amount"). Should
the Rebate Amount on any Determination Date be negative, the
Trustee may transfer such excess amount out of the Rebate Account
in accordance with the written directions of the Issuer and the
Lessee, ~owever, no amount shall ever be transferred out of the
Rebate Account except to make a payment pursuant to Section 8.04
hereof.
Section 8.04. - Application of Funds in Rebate Account.
Funds On deposit in the Rebate Account shall be applied as
follows:
The full'amount required to be rebated to the United states
by the Issuer.and the Lessee, as set forth in written directions
to the Trustee from the Issuer and the Lessee such direct-ions
being in compliance with Section 148(f) of the Code, shall be
withdrawn by the Trustee from the Rebate Account and paid to the
Internal Revenue Service on the earlier of (i) a date not later
than 60 days following the date on which the last payment is made
or prepaid under the Certificates, or (ii) a date not later than
30 days after the fifth anniversary of the Issue Date. Until the
date on which the last payment is made under the Certificates,
rebate payments, if any, will be made not later than 30 days after
every fifth anniversary of the Issue Date. Such payments to the
United States shall be made to the address and at the times speci-
fied in the appropriate Treasury Regulations, pursuant to written
directions from the Issuer and the Lessee. Funds on deposit in
the Rebate Account shall, except for any amounts transferred out
of the Rebate Account pursuant to Section 8.03 hereof, be used
only to pay the Rebate Amount and for no other purpose until the
final payment of the Rebate Amount is paid to the United States
following payment of the entire principal amount of the Certifi-
cates (the "Final Payment"), at the time and in the mannec speci-
fie~ by the iss~er and the Lessee ~nd pursuant to the written
32
directions from the Issuer and the Lessee. FollOwing such Final
Payment the Trustee shall pay any balance in the Rebate Account to
the Issuer and the Lessee to be spent for.any lawful purpose.
Section 8.05 - Trustee Not Liable. Notwithstanding anything
to the contrary, the Trustee is under no independent obligation
to, and is not responsible for determining any amount to be
rebated to the U.S. Treasury which is required by Section 148(f)
of the Code. However, the Trustee will be authorized to retain at
the Issuer's and the Lessee's expense, counsel, accountants. or
experts which the Trustee, in its sole discretion, determines
advisable to determine the amount, due dates and any other
requirements of the rebate. The Trustee may rely On and will not
be liable for any loss occasioned by its reliance on the instruc-
tions of such experts or on instructions from the Issuer and the
Lessee as to the amounts tO be placed in the Rebate Account and
amounts to be rebated hereunder.
Section 8.06 Liens on Moneys in Rebate Account. Moneys of
Lessee in the Rebate Account shall be deemed subject to the
following liens, in the following order of priority:
(i) First, in favor of the United States to the extent
of all amounts which must be paid to the United States
through the period ending thirty days after the applicable
Final Payment in order to preserve the exclusion from gross
income of the Certificate Interest Payments on the
Certificates;
(ii) Second, in favor of the Trustee, to the extent of
its reasonable fees and expenses payable hereunder; and
(iii) ~Third, in favor of the Certificate Owners, to.the
extent of any moneys owed them.
Section 8.07 - Miscellaneous Provisions Concernin~ Rebate
Account. (a) Notwithstanding anything else herein contained, the
moneys of the Issuer and the Lessee in the Rebate Account shall
not be released upon any defeasance hereunder or under the Lease
Purchase Agreement effective prior to the applicable Final
Payment, and such moneys shall be held and applied pursuant to the
terms hereof until thirty days after the Final Payment.
(b) The Trustee shall not be required to make any pay-
ment required by this Section 8.07 except (i) from moneys in the
Rebate Account and (ii) only upon written instructions to do so
from the Issuer and the Lessee.
(c) No Investment Property or security or obligation
(other than an obligation described in Section 103(a) of the
Code), any annuity contract or any other investment type property
s~al! ~e acquired with oross proceeds for an amount (including
33
transaction costs) in excess Of the fair market value of such
Investment Property. No Investment Property shall be sold o~
otherwise disposed of for an amount (including transaction costs)
less than the fair market value of the investment Property.
The fair market value of any Investment Property for which
there is an established market shall be determined as provided in
the following sentence. The fair market value of any Investment
Property for which there is an established market shall be the
mean of the bid and offered prices on an established market where
such Investment Property is entered into, or, if there are no bid
and offered prices on such date, on the first day preceding such
date for which there are bid and offered prices. Such mean price
may be determined by reference to any appropriate publication,
such as, for example, "Composite Closing Quotations for United
States Government Securities" published by the Federal Reserve
Bank of New York. Where the price of any Investment Property is
quoted on an established.market in terms of yield, the fai~ market
value shall be the amount necessary to produce such yield (exclud-
ing transaction costs) using the method of computing the yield on
the Certificates as described heroin. Notwithstanding the forego-
ing, the fair market value of InVestment Property may be estab-
lished by the borrowing practices of the issuer of such Investment
Property, as, for example, by determining the fair market value
based on the interest ordinarily paid by such issuer to persons
other than governmental units with respect to Investment Property
of comparable maturities. The market prices of a time or demand
deposit shall be determined under the preceding sentence by taking
into account the yield that would be paid by the obligor i£ the
deposit were held as an interest bearing deposit for the expected
period of the deposit. The market price of a certificate of
deposit issued by a commercial bank may be determined as the bona
fide bid price quoted by a dealer who maintains an active second-
ary market in such certificates of deposit. Notwithstanding
anything to the contrary in this paragraph:
(1) if Investment Property is acquired in an arm's length
transaction without regard to any amount paid to reduce the
yield on the Investment Property, the fair market value of the
Investment Property shall be the amount paid for the Invest-
ment Property;
(2) if. Investment Property is sold or otherwise disposed
of in an arm's length transactfon without regard to any
reduction in the disposition price to reduce the Rebate
Requirement, the fair market value of the Investment Property
shall be the amount realized from the sale or other disposi-
tion of the Investment Property (including transaction costs);
and
(3) if a United States Treasury obligation is acquired
d~ectly ~om or disposed of directly to the United States
34
Treasury, such acquisition or disposition shall be treated as
establishing a market foe the obligation and as establishing
the fair market value of the obligation.
Except to the extent provided in the following paragraph, any
Investment Property foe which there is not an established market
shall be considered acquired for an amount in excess of the fair
market value of the Investment Property.
In the case of a certificate of deposit issued by a commer-
cial bank for which there is no active secondary market, the cer-
tificate of deposit shall be considered acquired or disposed of
for an amount equal to the fair market value of the certificate of
deposit if the certificate of deposit has a yield (1) in the case
of an acquisition, as high or higher or in the case of a disposi-
tion, as low or lower, than the yield on comparable obligations
traded on an active secondary market, as certified by a dealer who
maintains such a market;,and (2) in the case of an acquisition, as
high or higher, or in the case of disposition, as low or lower
than the yield available on comparable obligations offered by the
United States Treasury. The certification referred to in (1) must
be executed by a dealer which maintains an active secondary market
in comparable certificates of deposit and must be based on actual
trades adjusted to reflect the size and term of that certificate
of deposit and the'stability and reputation of the person issuing'
the certificate of deposit.
(d) In order to perform the calculations required by the
Code, it is necessary to track separately all of the gross pro-
ceeds. To that end the Lessee must establish separate subaccounts
or take other accounting measures in order to account fully foe
all gross proceeds.
(e) The Issuer and the Lessee shall retain all records with
respect to the calculations and instructions required by this
Article VIII for at least 6 years after the date on which the last
of the principal of and interest on the Certificates has been
paid, whether upon maturity, redemption or acceleration thereof.
(f) The Issuer and the Lessee shall be responsible for calcu-
lating all amounts to be deposited in its Rebate Account and all
amounts to be paid to the United States in accordance with the
provisions of this Article VIII and preparing any document
required under Section 148 of the Code and any regulations in
regard thereto.
(g) Notwithstanding any of the provisions of this Article
VIII if the Issuer or the Lessee is provided an opinion of Special
Counsel that any specified action required under this Article VIII
is no longer required or that some further or different action is
required to maintain or assure the exclusion from federal gross
~come o~ interest with respect to the Certificates the Issuer and
the Lessee each shall comply wi~h suci~ provis~o~s.
35
The Trustee shaft be fully protected in acting on any
calculations made by the Issuer and the Lessee in order to insure
compliance with the provisions of this Article VIII at any time
and shall not be liable or responsible in'any manner to any person
for so acting, notwithstanding any error in such determination.
36
ARTICLE IX
COVENANTS OF THE ISSUER
Section 9.01 - Limitations on Security. Anything herein to
the contrary notwithstanding, (a) neither the State nor any of its
political subdivisions, including the Lessee, shall ever be com-
pelled to (i) levy any ad valorera taxes on any property within .its
territorial limits to pay the Certificate Principal Payments, or
Premium Portion, if any, or Certificate Interest Payments on the
Certificates or to make any other payments provided for under the
Lease Purchase Agreement Or this Trust Indenture, or (ii) pay the
same from any funds of the Lessee or the Issuer other than Non-Ad
Valorem Revenues or those provided in this Article IX or as other-
wise provided in the Lease Purchase Agreement; and (b) neither the
Lease Purchase Agreement 'nor the Certificates shall be or consti-
tute general obligations of the Lessee or a lien upon any property
owned by or situated within the territorial limits of the Lessee
except the Project as provided in the Mortgage.
This Trust Indenture shall be an unconditional general obli-
gation of' the Issuer.
Section 9.02 - Payment of Principal, Interest and Redemption
Premium. Solely from the funds pledged hereunder the Issuer will
~y pay the principal of, premium, if any, and interest on
the Certificates at the places, on the dates and in the manner
specified in this Trust Indenture, and in the Certificates,
according to the true intent and meaning thereof.
Section 9103 - No Extension of Time Of Payment of Interest.
The Issuer will not directly ,or indirectly extend or consent to
the extension of the time for payment of any interest on any Cer-
tificate and will not directly or indirectly be a party to or
approve any arrangement for the indirect accomplishment of any
such extension, by purchasing or funding any claim for interest or
in any other manner. In case any claim for interest shall be
extended or funded in violation of this Section 9.03, such claim
for interest shall not be entitled, in case of any default under
this Trust Indenture, to the benefit or security of this Trust
Indenture except subject to the prior payment in full of the Cer-
tificate Principal Payment and Premium Portion (if any) on all
Certificates and of all claims for interest which shall not have
been so extended or funded.
Section 9.04 - Enforcement and Modification of Lease Purchase
Agreement. So long as any of the Certificates are Outstanding,
the Issuer will require the Lessee to pay, Or cause to be paid,
all the Lease Purchase Rent and other costs and charges payable by
the l_.~sse~ un~e~ th~ Lease Purchase Agreement. The Lease Purchase
Agreement may not be amended, changed, modified, altered or
37
terminated so as to adversely affect (a) the.interest of the
Trustee without the prior written consent of the Trustee, or (b)
the interest of the Owners of Outstanding, Certificates without the
prior written consent of (i) the Owners of at least fifty-one
percent (51%) in aggregate principal amount of. the Certificates
then Outstanding, and (ii) in case less than all of the Certifi-
cates then Outstanding are affected by the modifications or amend-
ments, the Owners of not less than fifty-one percent (51%) in
aggregate principal amount of the Certificates so affected then
Outstanding; provided, however, that if such modification. or
amendment will, by its terms, not take effect so long as any spe-
cified Certificates remain outstanding, the consent of the Owners
of such specified Certificates shall not be required and such
Certificates shall not be deemed to be Outstanding for the purpose
of any calculation of Outstanding Certificates under this Section
9.04; provided, further, that no such amendment, change, modifica-
tion, alteration or termination will reduce the percentage of the
aggregate principal amount of Outstanding Certificates required to
consent to any such amendment, change, modification, alteration or
termination, or decrease the amount of any payment required to be
made under the Lease Purchase Agreement or extend the time of
payment thereof. No amendment of the Lease Purchase Agreement
shall be made except in accordance with Article XI hereof.
The Issuetwill require the Lessee to'observe faithfully all
of its covenants and agreements under the Lease Purchase Agree-
ment; and, in case the Lessee shall fail to make such payments or
observe said covenants and agreements, the Issuer will institute
and prosecute all such legal proceedings as may be appropriate and
permitted under the Lease Purchase Agreement for the protection of
the Owners of the Certificates.
SectiOn 9.05 - Taxes; Assessments; Liens. The Issuer will
cause the Lessee: (a) to pay or make .provisions for payment of,
as the same shall become due, all lawful taxes and assessments,
including income, profits, property or excise taxes or any inter-
est and penalties relating thereto, if any, or Real Estate Taxes
Or other municipal or governmental charges lawfully levied or
assessed by the federal, state or municipal government upon the
Issuer with respect to the Project or any part thereof or upon any
payments in respect thereof under the Lease Purchase Agreement or
in respect Of this Trust Indenture, the Lease Purchase Agreement
or any other deed, agreement, instrument or document made or to be
made in connection herewith or therewith; (b) not to allow to be
created any lien or charge upon the payments pursuant tO the Lease
Purchase Agreement, except the lien of this Trust Indenture; and
(c) to pay or discharge or make adequate provisions to satisfy and
discharge within sixty (60) days after the same shall come into
force, any lien or charge upon the payments pursuant tO the Lease
Purchase Agreement and all lawful claims or demand for labor,
materials, supplies or other charges which, if unpaid, might be or
become a lien upon the payments pursuant to the Lease Purchase
38
Agreement, except the lien of this Trust Indenture; provided,
however, that nothing contained in this Section 9.05 (i) shall
require the Issuer to pay any such charge, or (ii) shall require
the Issuer to cause the Lessee to pay or cause to be discharged or
make provisions for payment of any such lien or charge as long as
the validity thereof shall be contested in accordance with (and
such contest is permitted by) Section 8.1 of the Lease Purchase
Agreement.
Section 9.06 - Documentary Stamps and Intangible Tax. To the
extent that any State taxes, fees or other charges, including (but
not limited to) any documentary stamp taxes, intangible personal
property taxes, franchise taxes or recording fees or charges, are
payable in connection with the execution and delivery of the Mort-
gage, this Trust Indenture, the Certificates or any other Certifi-
cate Documents, or in connection with any of the transactions
contemplated hereby or ~hereby, including the original issuance
hereof or thereof and transfers and exchanges in accordance with
the terms hereof or thereof, whether any such taxes are due and
payable by the mortgagor, the mortgagee or any Owner of a Certifi-
cate or may be imposed upon the Trust Estate, the Issuer covenants
and agree, s to pay all such taxes promptly when due, except that
the Issuer is not obligated pursuant to this 9.06 to pay any such
taxes imposed by the State or any local government or taxing
authority of the State based on or measured by the net income of
any owner of a Certificate.
In. the event of the passage, after the date of the Mortgage,
of any law deducting from the value of land for the purposes of
taxation, any lien thereon, or imposing upon the mortgagee the
obligation to pay the whole, or any part, of the taxes or assess-
ments or charges or liens herein required to be paid by the
Issuer, or changing in any way the laws relating to the taxation
of mortgages or debts as to affect the Mortgage or the "Indebted-
ness" secured thereby, the entire unpaid balance of all sums
secured thereby shall, at the option of the Trustee, after thirty
(30) days written notice to the Issuer, become due and payable.
If at any time any applicable agency of the State shall
determine that the documentary stamps affixed to this Trust Inden-
ture are insufficient or if no documentary stamps have been
affixed and that such stamps should thereafter be affixed, the
Issuer shall pay for the same, together with any interest or
penalties imposed in connection with such determination and the
amount of money needed to pay for such stamps and penalties shall,
until such stamps are purchased and affixed, he a portion of the
indebtedness hereunder and hear interest from the date of such
determination at the rate set forth in this Trust Indenture
applicable to a period when default exists thereunder, and shall
be secured by the Mortgage.
If at any time applicable law shall require internal Revenue
Stamps to be affixed to this Trust Indenture, the Issuer shall pay
39
for the same, together with any intecest or penalties imposed in
connection therewith.
Section 9.07 Insurance on Project. The Issuer shall be
responsible for the maintenance of insurance on the Project, and
to require the Lessee to carry insurance on the Project in accord-
ance with the provisions of the Lease Purchase Agreement.
Section 9.08 - NO Other Sale or Disposition of Project. The
Issuer will not sell, lease or otherwise dispose of or encurber
the Project; except for Permitted Encumbrances, and as otherwise
permitted in this Trust Indenture or the Lease Purchase Agreement.
In the event of any involuntary conversion of the Project through
the exercise of powers of condemnation by the State or other
governing authority, the proceeds of any such condemnation shall
be applied first to defeasance of the Certificates as provided in
Article XII hereof. In the event that following an Event of Lease
Default or an Event of Ndn-Appropriation, the Project is not fore-
closed upon by the Trustee (i) the Issuer covenants that any
re-let or lease of the Project must be for fair market rental
value; (ii) priority must be given to governmental users; and
(iii) the excess of rentals collected over the Certificate Pay-
ments (o~ an amount equal thereto after no Certificates are Out-
standing) shall be remitted to the Lessee.
Section 9.09 - Take Further Necessary Actions. The Issuer
covenants that it will from time to time execute and deliver such
further instruments and take such further action as may be reason-
able and as may be required to carry out the purpose of this Trust
Indenture.
Section 9.10 - Maintenance Of Existence; Preservation Of
Tax-Exempt Status of Certificates. The Issuer will not take-any
action or Omit taking any action affecting its existence, includ-
ing the making of any amendments to its Articles of Incorporation
or By-laws, without the prior written consent of the Lessee and
the Trustee; and it will comply with all valid acts, rules, regu-
lations, orders and directions of any legislative, executive,
administrative or judicial body applicable to the Project. The
Issuer will not take, or omit to take any action which would have
an adverse impact on the Issuer's status as a qualified issuer of
tax-exempt obligations on behalf of the Lessee pursuant to the
Code. In particular, the Issuer will not issue debt obligations
of any kind without obtaining and furnishing to the Lessee and the
Trustee an opinion of Special Counsel to the effect that the issu-
ance of such debt obligations will not adversely affect the exclu-
sion from gross income under the Code of interest on the
Certificates.
Section 9.11 - Fair Market Value of Project. The Issuer
reasonably estimates that the fair market value of the Project on
t~.? i?t.~st Terrific%re ~at!~r~ty Date will be equal to at least 20
40
percent of the Costs financed by the Certificates, with the esti-
mated fair market value of such property determined without
including in the value any addition to the property or any
decrease or increase for deflation or inflation during the term of
the Certificates. Further, the Issuer reasonably estimates that
the remaining useful life of the Project on the latest Certificate
Maturity Date is the longer of one year or 20 percent of the ori-
ginally estimated useful life of the Project financed by the
Certificates.
If at any time during the term of this Trust Indenture it
becomes apparent that the Project does not meet the above esti-
mates, the Issuer covenants to replace or repair the portion of
the Project financed by the Certificates to the extent necessary
to meet the above estimates.
Section 9.12 - Option to Purchase. (a) The Issuer has
granted to the Lessee an Option to purchase all right, title and
interest of the Issuer in and to the Project at any time during
the term of this Trust Indenture for an amount which, together
with moneys then on deposit in the Reserve Fund and the Rent Pay-
ment Fund shall be sufficient to pay when due the Certificate
Principal' Payments, Premium Portion, if any, and Certificate
Interest Payments on the Outstanding Certificates, in accordance
with the provisions of Section 12.01 hereof and Sections 17.2 and
~ 9 of the Lease Purchase Agreement and to pay reasonable costs
incident thereto. Such payment shall be deposited by the Trustee
to the credit of the Rent Payment Fund and applied to the payment
of the Certificates, and the Lessee shall thereupon obtain unen-
cumbered fee title and exclusive possession of the Project and any
additions thereto, subject only to the Permitted Encumbrances.
(b) The Issuer shall not.enter into any lease of the Project
(except the Lease Purchase Agreement) or any management contract
with respect to same without the prior written consent of the
Trustee nor shall Issuer place any encumbrance on the Project
(other than the lien of the Mortgage and this Trust Indenture) and
any such lease or management contract shall provide that the user,
lessee or manager shall vacate the Project within a reasonable
time, not to exceed ninety (90) days after the Lessee exercised
the Option and such lease contract shall thereupon be deemed can-
celed. This covenant shall continue in effect so long as the
Certificates are Outstanding notwithstanding the occurrence of an
Event Of Default or an Event of Non-Appropriation.
Section 9.13 - Issuer to Maintain Not-For-Profit Status.
None of the Lease Purchase Revenues, income or profits of the
Issuer, whet.her realized or unrealized, will be distributed to any
of its members, or inure to the benefit of any private person,
association or corporation, other than for the lawful purposes of
the T~s~er; prey ided, however, the Issuer may pay to any person,
association or corporation the value o~ any servxce or pf~d~cz
41
performed for or supplied to the Issuer by any such person, asso-
ciation or corporation. The Issuer will conduct its business and
activities in such manner that it will at all times maintain and
preserve its existence as a not-for-profit corporation with
authority to do business in the State.
Section 9.14 Information To Be Provided to MBIA. Issuer
shall provide MBIA with the following information:
(i) The Issuer's budget and the Lessee's budget for each
year and annual audited financial statements, preferably
within 120 days after the end of the Issuer's and Lessee's
respective fiscal years;
(ii) Official Statement, if any, prepared in connection
with the issuance of additional debt Of the Issuer or of the
Lessee;
(ill) Notice Of any draw upon or deficiency due to market
fluctuation in the Reserve Fund;
(iv) Notice of the redemption, other than mandatory sink-
ing fund redemption, of any of the Certificates, including
the ~rincipal amount, maturities and CUSIP numbers thereof;
and
(v) Concu[rently with the provisions of the annual audit
and budget, the Issuer .will also provide such additional
information as MBIA requests.
42
ARTICLE X
DEFAULT PROVISIONS AND REMEDIES OF
TRUSTEE AND OWNERS OF CERTIFICATES
Section 10.01 - Defaults. The occurrence of any of the fol-
lowing events, subject to the provisions of Section 10.10 hereof,
is hereby defined as and declared to be and to constitute an Event
of Default:
(a) Default in the due and punctual payment to an Owne~ of a
Certificate of any portion of a Certificate Interest Payment
represented by a Certificate and such payment has not been made
under the Municipal Bond Insurance Policy in accordance with the
terms thereof; or
(b) Default in the due and punctual payment to an Owner of a
Certificate of any portion of a Certificate Principal Payment
represented by any Certificates whether at a Certificate Payment
Date, the stated maturity thereof, or the redemption date set
therefor in accordance with the terms hereof and such payment has
not been made under the Municipal Bond Insurance Policy in accord-
ance wit~ the terms thereof; or
(c) The Occurrence Of an Event Of Default pursuant to the
Lease Purchase Agreement and receipt by the Trustee of written
direction from MBIA to declare an Event of Default hereunder.
Section 10.02 Acceleration. Upon the occurrence of an
Event Of Default (a) described in Section lO.01(a) or (b) hereof
the Trustee may, and upon receipt of a Directlye shall, by notice
in writing delivered to the Issuer, declare the Certificate Prin-
cipal Payments so in default and the Certificate Interest Payments
accrued to the date of such acceleration immediately due and pay-
able, or (b) described in Section 10.Ol(c) hereof, the Trustee
shall, by notice in writing to the Issuer and the Lessee (with the
consent of MBIA), declare the Basic Rent Payment coming due under
the Lease Purchase Agreement through the end of the then current
Fiscal Year immediately due and payable.
Section 10.03 - Other Remedies. Upon the occurrence of an
Event of Default hereunder, the Trustee shall liquidate the Trust
Estate as aforesaid (which, in the case of an Event of Default
under Section 10.01(c) hereof, shall be only upon the prior writ-
ten direction from MBIA to do so) and pursue any othef remedy
available to it at law, under the Lease Purchase Agreement, the
Assignment or by statute.
In the event that the Project is not foreclosed upon by the
Trustee (i) the re-let or lease of the Project must be for fair
market rental value~ (ii) priority must be given to governmental
43
users: and (iii) the excess of rentals collected over the Certifi-
cate Payments (or an amount equal thereto after no Certificates
are Outstanding) shall be remitted to the Lessee.
No remedy by the terms of this Trust Indenture conferred upon
or reserved to the Trustee or to the Owners is intended to be
exclusive of any other remedy, but each and every such remedy
shall be cumulative and shall be in addition to any other remedy
given to the Trustee or to the Owners hereunder or now or here-
after existing at law or in equity or by statute.
No delay or omission to exercise any right or power accruing
upon any default shall impair any such right or power or shall be
construed to be a waiver of any such default or acquiescence
therein, and every such right and power may be exercised from time
to time and as often as may be deemed expedient.
No waiver of any default hereunder whether by the Trustee or
by the Certificate Owners shall extend to or shall affect any
subsequent default or shall impair any rights or remedies conse-
quent thereon.
Section 10.04 - Rights of Certificate Owners. If an Event of
Default shall have occurred and be continuing and if requested to
do so by a Directlye (which, in the case of an Event of Default
under Section 10.01(c) hereof, shall be with the consent of MBIA)
and indemnified as provided in Section 10.07 hereof, the Trustee
shall be obligated to exercise or to refrain from exercising such
one or more of the rights and the remedies conferred by this
Article X as specified in such Directires, which may without limi-
tation, include the time, method and place of exercising the same,
or if none is specified therein as the Trustee, upon the advice of
counsel, shall deem to be in the interests of the Certificate
Owners.
Section 10.05 - Application of Moneys. All moneys received
by the Trustee pursuant to any right given or action taken under
the provisions of this Article X shall, after payment of the
costs, fees and expenses of the Trustee and of the proceedings
resulting in the collection of such moneys and of the expenses,
liabilities and advances incurred or made by the Trustee, be
deposited into the Rent Payment Fund and all such moneys in the
Rent Payment Fund shall be applied as follows:
(a) Unless the Certificate Principal Payments represented by
all the Certificates shall have become or shall have been declared
due and payable, all such moneys shall be applied:
FIRST - To the payment to the persons entitled thereto
of the Certificate Interest Payments in the order of the
maturity of the installments of interest and, to the payment
rat.~blv~ according to the amount due on such installments, to
nile persons e~ltLed thereto, without ~r~y d~sc~ir~aLio~'~ O~
privilege;
44
SECOND - TO the payment to the persons entitled thereto
of the unpaid Certificate Principal Payments that shall have
become due whether by maturity or declared redemption date
(other than the portions of such Certificate Principal Pay-
ments represented by Certificates with respect to the payment
of which moneys are held pursuant to the provisions of this
Trust Indenture) in the order of such due dates, with inter-
est from the respective dates upon which they become due and,
if the amount available shall not be sufficient to pay in
full such Certificate Principal Payments due on any pasti-
cular date, together with such interest, then to the payment
ratably, according to the amount of principal due on such
date, to the persons entitled thereto without any discrimina-
tion or privilege; and
THIRD - To the payment of any additional amounts owed to
MBIA hereunder which have not been paid pursuant to FIRST and
SECOND of this Section 10.05(a).
(b) If Certificate Principal Payments evidenced by all the
Certificates shall have become due Or shall have been declared due
and payable, all such moneys shall be applied to the payment of
such Certificate Principal Payments represented by Certificates
due and dnpaid upon the Certificates without preference or prior-
ity of principal over the interest or of interest over principal,
or of any installment of interest over any other installment of
interest, or of any Certificate over any other Certificate,
ratably, according to the amounts due respectively for principal
and interest, to the persons entitled thereto without any discrim-
ination or privilege and then to the payment of any additional
amounts owed to MBIA hereunder which have not been paid pursuant
to FIRST and SECOND of Section 10.05(a) hereof.
(c) If Certificate Principal Payments represented by all the
Certificates shall have been declared due and payable and if such
declaration shall thereafter have been rescinded and annulled
under the provisions of this Article X, then, subject to the pro-
visions of paragraph (b) of this Section 10.05, in the event that
the Certificate Principal Payments represented by all the Certifi-
cates shall later become due or be declared due and payable, the
moneys shall be applied in accordance with the provisions of para-
graph (a) of this Section 10.05.
Whenever moneys are to be applied pursuant to the provisions
of this Section 10.05 (i) if the Event of Default has occurred
under Section 10.01(a) or (b) hereof, such moneys shall be applied
at such times, and from time to time, as the Trustee shall deter-
mine, having due regard to the amount of such moneys available for
the application and the likelihood of additional moneys becoming
available for such application in the future, or (if) if the Event
of Default has occurred under Section 10.01(c) hereof, such moneys
shall be ~?]i~ ~t ~uch times and from time tO time as directed
45
by MBIA. Whenever the Trustee shall apply such funds, it shall
fix the date (which shall be a Certificate Payment Date unless it
shall deem another date more suitable) upon which such application
is to be made and upon such date interest on the amounts of
principal to be paid on such dates shall cease to accrue. The
Trustee shall give such notice as it may deem appropriate of the
deposit with it Of any such moneys and of the fixing of any such
date and shall not be required to make payment to the Owner of any
Certificate until such Certificate shall be presented to the
Trustee for appropriate endorsement or for cancellation if paid,in
full.
Whenever the Certificate Principal Payments or the Certifi-
cate Interest Payments represented by all Certificates have been
paid under the provisions of this Section 10.05 and all expenses
and charges of the Trustee have been paid, any balance remaining
in the Rent Payment Fund shall be paid to the Issuer and to the
Lessee.
Section 10.06 - Remedies Vested in Trustee. All remedies and
rights of action (including the right to file proof of claims)
under this Trust Indenture or under any o~ the Certificates may be
enforced bY the Trustee without the possession o~ any of the Cer-
tificates or the productigR thereo~ in any trial or other proceed-
ings relating thereto and any such suit or proceeding instituted
by the Trustee shall be brought in its name as Trustee without the
necessity of joining as plaintiffs or defendants any owners of the
Certificates and any recovery of judgment shall be for the equal
benefit of the Owners of the Outstanding. Certificates. Notwith-
standing anything to the contrary contained herein, upon the
occurrence and continuance of an Event of Default (other than
under Section 10.01(a) or (b) hereof), MBIA shall have the right
to control and direct the enforcement of any rights or remedies of
the Trustee.
Section 10.07 Rights and Remedies of Certificate Owners.
No Owner of any Certificates shall have any right to institute any
suit, action or proceeding in equity or at law for the enforcement
of this Trust Indenture for the execution of any trust hereof, for
the appointment of a receiver or to enforce any other remedy here-
under, unless (1) an Event of Default has occurred; (2) the Owners
of not less than a majority in aggregate principal amount of Cer-
tificates Outstanding shall have made written request to the
Trustee (which, in the case of Event of Default under Section
10.01(c} hereof, shall be only with the prior written consent of
MBIA) and have offered reasonable opportunity either to proceed tO
exercise the powers hereinbefore granted or to institute such
action, suit or proceeding in its own name; (3) such Owners have
provided to the Trustee indemnification satisfactory to the
Trustee; and (4) the Trustee shall thereaEter fail or shall refuse
to exercise the powers hereinbefore granted or to institute such
action, suit or o~oceedings in its, his, her or their name or
46
names. Such notification, request and indemnity are hereby
declared in every case at the option of the Trustee to be condi-
tion precedent to the execution of the powers and the trusts of
this Trust Indenture and to any action or'cause of action for the
enforcement Of this Trust indenture or for the appointment of a
receiver or for any other right or remedy hereunder. No one or
more Owners of the Certificates shall have any right in any manner
whatsoever to affect, to disturb oF to prejudice the lien of this
Trust Indenture by its, his, her or their action or to enforce any
right or remedy hereunder except in the manner herein provided and
all proceedings at law or in equity shall be instituted, had and
maintained in the manner herein provided and for the equal benefit
of the Owners of all Certificates then Outstanding. Nothing in
this Trust Indenture contained shall, however, affect oF impair
the right of any Certificate Owner to enforce the payment or pre-
payment of the Certificate Principal Payment or the Certificate
Interest Payment represented by any Certificate at and after the
maturity or earlier decla, red prepayment date thereof.
Section 10.08 - Termination of Proceedings. If the Trustee
shall have proceeded to enforce any right or remedy under this
Trust Indenture by the appointment of a receiver, by entry or
otherwise and such proceedings shall have been discontinued or
abandoned' for any reason or shall have been determined adversely,
then and in every such case, the Issuer, the Lessee and the
Trustee shall be restored to their former respective positions and
rights hereunder and all rights, remedies and powers of the
Trustee shall continue as if no such proceeding had been taken.
Section 10.09 - Waivers of Events of Default. The Trustee
shall waive any Event of Default hereunder and its consequences
and rescind any declaration of maturity of principal upon the
written request of the Owners of a majority in aggregate principal
amount of all Certificates t~en Outstanding; provided, however,
that there shall not be waived (a) any Event of Default respecting
the payment of Certificate Principal Payments or declared redemp-
tion date prior thereto, or (b) any Even~ of Default respecting
the payment of an Certificate Interest Payment represented by any
Certificate, unless prior to such waiver or rescission, all
arrears of principal and interest when due, as the case may be,
and all expenses of the Trustee in connection with such default
shall have been paid or provided for and, in case any such waiver
or rescission or in case any proceeding(s) taken by the Trustee on
account of any such default shall have been discontinued or
abandoned or determined adversely, then and in every such case the
Trustee and the Certificate Owners shall be restored to their
former positions and rights hereunder, respectively, but no such
waiver or rescission shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 10.10 - Enforcement Of Lease Purchase A~r~ement. The
Trustee shall enforce each of the terms and provisions of the
47
Lease Purchase Agreement except as otherwise directed by a Direc-
tire and all rights of the Trustee and all obligations of the
Lessee under and pursuant thereto in accordance with the terms and
provisions thereof and of this Trust Indenture. Upon the occur-
rence of an Event of Lease Default, the Trustee may exercise any
one or more of the remedies set forth therein except as otherwise
directed by a Directire (and Owners of the Certificates then Out-
standing shall have the right at any time by a Directive to direct
the exercise by the Trustee of said remedies,)
48
ARTICLE XI
MODIFICATION OR AMENDMENT OF
THIS TRUST INDENTUI{E
Section 11.01 - Amendments Permitted.' (a) This Trust Inden-
ture and the rights and obligations of the Lessee under the Lease
Purchase Agreement and of the Owners of the Certificates and of
the Trustee and of the Issuer may be modified or amended from bime
to time and at any time by an amendment or supplement hereto,
which the Issuer, Lessee and the Trustee may enter into with the
written consent of MBIA, the Owners of a majority in aggregate
principal amount of the Certificates then Outstanding, which shall
have been filed with the Trustee. No such modification or amend-
ment shall (1) extend the stated maturity or change any declared
prepayment date of any Certificate Principal Payment, or reduce
the amount of principal represented by any Certificate, or extend
the time of payment or reduce any Redemption Price provided in
this Trust Indenture for the payment of any Certificate, or reduce
the rate of interest with respect thereto, or extend the time of
payment of interest with respect thereto, or change the time or
conditions of any declared redemption with respect thereto without
the consent of the Owner of each Certificate so affected, or (2)
reduce the aforesaid percentage of Certl'flcates the consent of the
Owners of which is required to effect any such modification or
amendment, or permit the creation of any lien on the Lease Rights
and other assets declared subject to this Trust Indenture in the
Trust Estate or deprive the Owners of the Certificates of the lien
created by this Trust Indenture on such Lease Rights and other
assets in the Trust Estate (except as expressly provided in this
Trust Indenture) without the consent of the Owners of all of the
Certificates then Outstanding. Promptly after the execution by
the Issuer, Lessee and the Trustee of any amendment pursuant to
this subsection (a), the Trustee shall give Notice by Mail,
setting forth in general terms the substance of such amendment to
the Owners at the addresses listed on the Certificate Register.
Any failure to give such notice, Or any defect therein, shall not,
however, in any way impair or affect the validity of any such
amendment.
(b) Notwithstanding subsection (a) above, this Trust Inden-
ture with respect to the Lease Purchase Agreement and the rights
and obligations of the Lessee thereunder, of the Issuer, of the
Trustee and of the Owners of the Certificates may also be modified
or amended from time to time and at any time by an agreement which
the Issuer, Lessee and the Trustee may enter into with the consent
of MBIA but without the consent of any Certificate Owners, but
only to the extent permitted by law and only for any one or more
of the following purposes:
(1) to add to the covenants and agreements of the
Trustee on ~ne lss~e~ oF the L~e in ~his 'i~dSL inde~cu~,
49
other covenants and agreements thereafter to be observed, to
pledge or assign additional security for the Certificates (or
any portion thereof) or to surrender any right or power
herein reserved to or conferred upon the Trustee, Lessee or
the Issuer; provided, however, that no such covenant, agree-
ment, pledge, assignment or surrender shall materially
adversely affect the interests of the Owners of the
Certificates;
(2) to make such provisions for the purpose of curing
any ambiguity, inconsistency Or omission, or of curing or
correcting any defective provision, contained in this Trust
Indenture, or Lease Purchase Agreement, or in regard to
matters or questions arising under this Trust Indenture or
Lease Purchase Agreement as the Trustee, Lessee or the Issuer
may deem necessary or desirable and not inconsistent with
said agreements, or as may be requested by the Lessee, the
Issuer or the Trustee, and which shall not, in any such case
materially adversely effect the interests of the Owners of
the Certificates or to facilitate the obtaining of a rating
on the Certificates by Moody's or Standard and Poor's;
(3) to modify, amend or supplement this Trust Indenture
in ~uch manner as to permit the qualification hereof under
the Trust Indenture Act of 1939, as amended, or any similar
federal statute hereafter in effect, and to add such other
terms, conditions and provisions as may be permitted by said
act or similar federal statutes and which shall not materi-
ally adversely affect the interests of the Owners of the
Certificates; or
(4) to provide for any additional procedures, covenants
or agreements necessary to maintain the exclusion from gross
income for federal income tax purposes of the Certificate
Interest Payments on the Certificates.
Section 11.02 - Effect of Amendments. Upon the execution of
any amendments hereto, pursuant to this Article XI, this Trust
Indenture shall be deemed to be modified and amended in accordance
therewith but only with respect to the Trust Estate and the Certi-
ficates, and the respective rights, duties and obligations under
this Trust Indenture of the Lessee, the Trustee, the Issuer and
all Owners of Certificates Outstanding shall thereafter be deter-
mi~ed, exercised and enforced hereunder subject in all respects to
such modification and amendment, and ell the terms and conditions
of any such amendment shall be deemed to be part Of the terms and
conditions of this Trust Indenture, for any and all purposes with
respect to the Trust Estate and the Certificates.
Section 11.03 - Endorsement of Certificates; Preparation of
New Certificates. Certificates delivered after the execution of
any amendment pursuant to this Article XI may, and if the Trustee
so determines sisaLS, bear a notation by endorsemen~ oc oti~e[w~se
50
in form approved by the Issuer, the Lessee and the Trustee as to
any modification or amendment provided for in such amendment, and
in that case, upon demand of the Owner of, any Outstanding Certifi-
cate at the time of such execution and 'presentation of his for
such purpose at the Principal O~fice o~ the Trustee,' a suitable
notation shall be made on such Certificate. If the amendment
shall so provide, new Certificates so modified to conform, in the
opinion of the Issuer, the Lessee and the Trustee, to any modifi-
cation or amendment contained in such amendment, shall be prepared
and executed by the Trustee, and upon demand of the Owners of ~ny
Certificates then Outstanding shall be exchanged at the Principal
Office of the Trustee without cost to any Owner of a Certificate,
for Certificates then Outstanding, upon surrender for cancellation
of such Certificates in equal aggregate principal amounts of the
same maturity and tenor.
Section 11.04 - Amendment Of Particular Certificates. The
provisions Of this Article XI shall not prevent any Owner Of a
Certificate from accepting any amendment as to the particular
Certificates held by him; provided, however, that due notation
thereof is made on such Certificates.
51
ARTICLE
DEFEASANCE OR DISCHARGE
Section 12.01 - Discharge of Trust Indenture as to Trust
Estate. (a)(i) When the obligations of the Lessee under the Lease
~se Agreement shall cease pursuant to Section 19 thereof
(except for the right of the Trustee and the obligation of the
Issuer and the Lessee to have the money and Governmental Obliga-
tions mentioned therein applied to the payment of Certificate
Payments as therein set forth), and (ii) the Issuer and the Lessee
shall have delivered to the Trustee and MBIA (x) an opinion of
Special Counsel to the effect that the conditions for such dis-
charge contained herein and in Section 12.01(b) have been satis-
fied and (y) an accountant's certificate with respect to the suf-
ficiency of Governmental Obligations so deposited and (iii) if the
Issuer and the Lessee s~all have deposited sufficient moneys to
pay the fees, compensation and expenses of the Trustee have been
reimbursed and paid hereunder and under the Lease Purchase Agree-
ment and the obligations created by this Trust Indenture with
respect to the Certificates shall thereupon cease and become void
except for those concerning the Rebate Account and the rights Of
the Owner~ and._the obligation of the Trustee to apply such moneys
and Governmental Obligations to the payment of the Certificates as
herein set forth.
In the event that the Certificate Principal Payments or Certi-
ficate Interest Payments represented by the Certificates shall be
paid by MBIA pursuant to the Municipal Bond Insurance Policy, the
assignment and pledge of the Trust Estate and all covenants,
agreements and other obligations of the Lessee to the Certificate
Owners shall continue to exist, such Certificates shall be deemed
"Outstanding" and MBIA shall be fully subrogated to the rights of
such Owners.
(b) After the Certificates have been paid, the Trustee
shall turn over to the Lessee any surplus in the Funds other than
(x) moneys and Governmental Obligations held for the payment of
the Certificates at maturity or upon redemption, which moneys and
Governmental Obligations shall continue to be held by the Trustee
in trust for the benefit of the Owners and shall be applied by the
Trustee to the payment, when due, of the Certificate Payments or
Redemption Price under the Certificates, and (y) moneys in the
Rebate Account which shall continue to be held and applied by the
Trustee in accordance with Article VIII hereof. After such pay-
merit, this Trust Indenture shall become void with respect to the
Certificates.
Section 12.02 - Deposit of Money or Securities with Trustee.
If moneys or non-calfable Government Obligations, are deposited
with and held by the Trustee with respect to the Certificates, as
hereinabove provided, the Trustee sha~, within znirLy (30) days
52
after such moneys or Governmental Obligations shall have been
deposited with it, give Notice hy Mail to.the Owners of the Certi-
ficates at the addresses listed on the Certificate Register,
setting forth (i) the Certificate Maturity Date, (ii) a descrip-
tion of the Government Obligations, if any, so held by it, and
(iii) that this Trust IndentUre has been released in accordance
with the provisions of this Section 12.02 with respect to the
Certificates and the Trust Estate. Whenever in this Trust Inden-
ture or the Lease Purchase Agreement, it is provided or permitsted
that there be deposited with or held in trust by the Trustee
moneys or securities in the necessary amount to pay or redeem any
Certificates, the money or securities so to be deposited or held
may include money or securities held by the Trustee in the funds
and accounts established pursuant to this Trust Indenture (exclu-
sive of the Project Fund and the Rebate Account) and shall be,
(a) lawful money of the United States of America in an amount
equal to the principal amount of such Certificates and all unpaid
interest evidenced thereby to maturity, except that, in the case
of Certificates which are to be redeemed prior to maturity and in
respect of which notice of such redemption shall have been given
as provid.ed in Article IV or irrevocable provision satisfactory to
the Trustee shall have been made for the giving of such notice,
the amount to be deposited or held shall be the Redemption Prices
(to the date of redemption) with respect to such Certificates; or
(b) non-callable Governmental Obligations, the principal of
and interest on which when due together with any moneys held by
the Trustee for such purpose will provide money sufficient to pay
the Certificate Payments under the Certificates to be paid and, as
to those Certificates to be redeemed, the Redemption Price thereof
to such date of redemption, provided that, in the case of Certifi-
cates which are to be redeemed prior to the maturity thereof,
notice of such redemption shall have been given as provided in
Article IV or irrevocable provision satisfactory to the Trustee
shall have been made for the giving of such notice; provided, in
each case, that the Trustee shall have been irrevocably instructed
( by the terms of this Trust Indenture and the Lease Purchase
Agreement) to apply such money to the payment of such principal or
Redemption Price and interest with respect to such Certificates.
Section 12.03 - Payment of Certificates After Discharge of
Trust Indenture. Notwithstanding any provisions of this Trust
Indenture, any moneys held by the Trustee in trust for the payment
of the principal or Redemption Price, with respect to any Certifi-
cates and remaining unclaimed for six years after the principal
represented by all of the Certificates has become due and payable
(whether at maturity or upon call for redemption or by accelera-
tion as provided in this Trust Indenture), if such moneys were so
held at such date, or three years after the date of deposit of
such moneys if ~epesite~ after said date when all of the Certifi-
cates became due and payable, shall, upon request of the Issuer or
53'
the Lessee, be repaid to the Lessee and all .liability of the
Trustee with respect to such moneys shall thereupon cease. In the
event of the repayment of any such moneys to the Lessee aforesaid,
the Owners of the Certificates with respect to which such moneys
were deposited shall thereafter have a claim against the Lessee
for amounts represented by such Certificates and so repaid to the
Lessee (without interest thereon), subject to any applicable
statute Of limitations.
Section 12,04 - Special Requirements With Respect to M~IA.
Notwithstanding anything to the contrary contained herein, prior
to any defeasance becoming effective under this Trust Indenture,
(i) the amounts required to be deposited in the escrow fund pursu-
ant to this Trust Indenture and the escrow deposit agreement shall
be invested only in Governmental Obligations which Governmental
Obligations shall not contain provisions permitting the redemption
thereof other than at the Option of the holder, and (ii) MBIA
shall have received (a)~he final official statement delivered in
connection with the refunding obligations, if any, (b) an executed
copy of the accountants' verification report, (c) a copy of the
escrow deposit agreement in form and substance acceptable to MBIA,
and (d) a copy of an opinion of Special Counsel, dated the date of
closing and addressed to MBIA, to the effect that such Certifi-
cates ha~e been paid within the meaning and with the effect
expressed in this Trust Indenture, and tha~'the covenants, agree-
ments and other obligations of the Issuer and the Lessee to the
Owners Of such Certificates and the obligations of the Lessee
under the Certificates and Lease Purchase Agreement have been
discharged and satisfied. Any Of the foregoing may be waived by
MBIA in its sole and absolute discretion at the time of such
defeasance.
54
ARTICLE XIII
THE TRUSTEE
Section 13.01 - Duties, Immunities and Liabilities of
Trustee. (a) The Trustee shall, prior to an Event of Default, and
a"~e~ the curing of all Events of Default which may have occurred,
perform such duties and only such duties as are specifically set
forth in this Trust Indenture. The Trustee shall, during ~he
existence of any Event Of Default (which has not been cured),
exercise such of the rights and powers vested in it by this Trust
Indenture, and use the same degree of care and skill in its exer-
cise, as a prudent man would exercise or use under the circum-
stances in the conduct of his own affairs; provided, however, the
Trustee may require as a condition precedent to taking any action
or exercising any rights and powers with respect to an Event of
Default indemnity from t~e Owners of the Outstanding Certificates
for the Trustee's costs and expenses, including but not limited to
reasonable fees of counsel and accountants and a Directive speci-
fying actions to be taken and the Trustee may rely upon said
Directire; provided, further, that the Trustee shall not seek
indemnity as a condition precedent to initiating any mandatory or
extraordihary redemption.
(b) The Issuer may, with the written consent of MBIA,
and shall at the request of MBIA, remove the Trustee at any time
upon thirty (30) days prior written notice to the Trustee with
respect to the Certificates and the Trust Estate unless an Event
of Default shall have occurred and then be continuing, and at any
time requested to do so by a Directlye of the Owners of the Certi-
ficates then Outstanding (or their attorneys duly authorized in
writing) for any reason with or without cause, by giving written
notice of such removal to the.Trustee and thereupon the successor
Trustee shall be appointed by the Issuer and the Lessee with the
written consent of MBIA.
(c) The Trustee may at any time resign with respect to
the Certificates and the Trust Estate by giving written notice of
such resignation to the Issuer, the Lessee and MBIA and by giving
the Certificate Owners Notice by Mail of such resignation at the
addresses listed on the Certificate Register. Upon receiving such
notice of resignation, the Issuer and the Lessee, with the written
consent of MBIA, shall promptly appoint a successor Trustee by an
instrument in writing.
(d) Any removal or resignation of the Trustee and
appointment of a successor Trustee shall only become effective
upon acceptance of appointment by the successor Trustee. If no
successor Trustee shall have been appointed and have accepted
appointment within sixty (60) days of giving notice of removal or
notice of ~esi~nation as aforesaid, the resigning Trustee or any
55
Certificate Owner (on behalf of himself and all other Certificate
Owners) may petition any court of competent jurisdiction for the
appointment of a successor Trustee, and such court may thereupon,
after such notice (if any) as it may deem proper, appoint such
successor Trustee. Any successor Trustee appointed under this
Trust Indenture shall signify its acceptance of such appointment
by executing and delivering to the Issuer, the Lessee and its
predecessor Trustee a written acceptance thereof, and thereupon
such successor Trustee, without any further act, deed or convey-
ance, shall become vested with all the moneys, estates, proper-
t~es, rights, powers, trusts, duties and obligations of such pre-
decessor Trustee with respect to the Trust Estate, with like
effect as if originally named Trustee herein; but, nevertheless,
at the request of the Lessee or the request of the Issuer and the
successor Trustee, such predecessor Trustee shall execute and
deliver any and all instruments of conveyance or further assurance
and do such other things as may reasonably be required for more
fully and certainly vesbing in and confirming to such successor
Trustee all the right, title and interest of such predecessor
Trustee in and to the Trust Estate and any property held by it
under this Trust Indenture with respect to the Trust Estate and
shall pay over, transfer, assign and deliver to the successor
Trustee the Trust Estate and any money or other property subject
to the t~usts and conditions herein set forth. Upon request of
the Issuer and the Lessee or the successor Trustee, the Issuer
shall execute and deliver any and all instruments as may be
reasonably required for more fully and certainly vesting in and
confirming to such successor Trustee all such moneys, estates,
properties, rights, powers, trusts, duties and obligations with
respect to the Trust Estate. Upon acceptance of appointment by a
successor Trustee as provided in this subsection, such successor
Trustee shall Cause notice of such acceptance to the mailed, first
claes postage prepaid, to the Owners of the Certificates at-the
addresses listed on the Certificate Register.
(e) Any Trustee appointed under the provisions of this
Section 13.01 in succession to the Trustee shall be a state or
national trust company or bank having the powers of a trust com-
pany under Florida law, having a combined capital and surplus of
at least fifty million dollars ($50,000,000), and subject to
supervision and examination by federal or state authority. If
such bank or trust company publishes a report of condition
least ~nnually, pursuant to law or to the requirements of any
supervising or examining authority above referred to, then for the
purpose of this subsection the combined capital and surplus of
such bank or trust company shall be deemed to be its combined
capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this
subsection (e), the Trustee shall resign immediately in the manner
and with the effect specified in th~s Section 13.01.
56
(f) Any Trustee hereunder shall not be liable for any-
thing done or not done after the effective date of the appointment
of a successor Trustee to it hereunder; provided, however, that
such removal or substitution shall not affect such Trustee's lia-
bility hereunder for the period during which it served as Trustee
hereunder.
(g) At any time that the Trustee reasonably deems it
necessary to do so in order to enforce any rights hereunder, the
Trustee shall have the right to appoint a co-trustee.
(h) In theevent that the Trustee resigns or is replaced
with respect to some of the Certificates hereunder but not as to
others, the successor Trustee, as a condition to such succession,
must execute an instrument of assumption incorporating the terms
hereof as to such series of Certificates and the Trust Estate in
recordable form and otherwise acceptable to the Issuer and the
Lessee, any rating agency, which has issued a rating on such Certi-
ficates and, if applicable, each of their respective counsel.
Section 13.02 - Merger or Consolidation. Any entity into
which the Trustee may be merged or converted or with which it may
be consolidated or any entity resulting from any merger, conver-
sion or donsolidation to which it shall be a party or any entity
resulting from any merge~r~='~onversion or consolidation to which it
shall be a party or any entity to which the Trustee may sell or
transfer all or substantially all of its corporate trust business,
provided such company shall be eligible under subsection (e) of
Section 13.01 shall be the successor to such Trustee, without the
execution or filing of any paper or any further act, anything
herein to the contrary notwithstanding.
Section 13.03 - Liability of Trustee. The Trustee shall-not
be liable in. connection with ~he performance of its duties here-
under, except for its own negligence or misconduct. The Trustee
may become the owner of Certificates with the same rights it would
have if it were not Trustee, and, to the extent permitted by law,
may act as depository for and permit any of its officers or direc-
tors to act as a member of, or in any other capacity with respect
to, any committee formed to protect the rights of Owners, whether
or not such committee shall represent the Owners of a majority in
principal amount of the Certificates then Outstanding.
Section 13.04 - Right of Trustee to Rely on Documents. The
Trustee shall be protected in acting upon any notice, resolution,
request, consent, order, certificate, report, opinion, Directlye
or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties. The
Trustee may consult with counsel, who may be counsel of or to the
Issuer and the Lessee with regard to legal questions, and the
opinion of such counsel shall be full and complete authorization
and protection in respect of any action taken or suffered by it
hereunder in good faith and in accorda~ce therewith.
57
The Trustee shall not be bound to recognize any person as the
Owner of a Certificate unless and until such Certificate is sub-
mitted for inspection, if required, and his title thereto is
satisfactorily established, if disputed. '
Whenever in the administration of the trusts imposed upon it
by this Trust Indenture the Trustee shall deem it necessary or
desirable that a matter be proved or established prior to taking
or suffering any action hereunder, such matter (unless other evi-
dence in respect thereof be herein specifically prescribed) ma~ be
deemed to be conclusively proved and establishedby a statement of
the Issuer and the Lessee, and such statement shall be full war-
rant to the Trustee or any action taken or suffered in good faith
under the provisions of this Trust Indenture in reliance upon such
statement, but in its discretion the Trustee may, in lieu
thereof, accept other evidence of such matter or may require such
additional evidence as it may deem reasonable.
Section 13.05 - Preservation and Inspection of Documents.
All documents received by the Trustee under the provisions of this
Trust Indenture shall be retained in its possession and shall be
subject at all reasonable times to the inspection of the Issuer
and the Lessee. MBIA and any Certificate Owner, and their agents
and representatives duly authorized in writing, at reasonable
hours and under reasonable conditions.
Section 13.06 - Responsibility. The Trustee shall not be
responsible for the authenticity or accuracy of any certifications
or documents, the application of amounts disbursed pursuant to any
certifications or documents, or the sufficiency of the funds
credited to the Funds and the Rebate Account to make disbursements
herein required.
Section 13.07 - Records;.Originalsof Documents. The Trustee
shall keep complete and accurate records of all moneys received,
invested, and disbursed under this Trust Indenture, which records
shal~ be available for inspection by such of the Issuer, the
Lessee, MBIA and the Owners of the Certificates or their agents,
at any time during regular business hours. The Trustee shall also
keep a duplicate original of the Certificate Documents for the
benefit of and for inspection by the Issuer, the Lessee, MBIA or
the Owners of the Certificates and by execution hereof the Trustee
acknowledges a receipt Of such a duplicate original of each of
such documents.
Section 13.08 -.Compensation of the Trustee. The Issuer and
the Lessee shall (a) pay to the Trustee the Trustee's reasonable
compensation for its services in the manner and amount agreed to
at the inception hereof and (b) shall from time to time reimburse
the Trustee for extraordinary expenses, including but not limited
to the Trustee's advances and expenditures, such as advances to
~nd ~ees and expenses of independent appraisers, accountants,
consultants, counsel, trustees and a~ocr~eys of oLher experts
employed by it in the exercise and performance of its powers and
duties hereunder.
58
ARTICLE XIV
MI SCELLANEOU S
Section 14.01 - Trust Indenture Binding Upon Parties and
Successors. This Trust Indenture shall inure to the benefit of
and shall be binding upon the Trustee, the Lessee and the Issuer
and their respective successors and assigns, subject, however, to
the limitations contained herein.' ·
Section 14.02 - Agreement in Several Counterparts. This Trust
Indenture may be simultaneously executed in several counterparts,
each of which, together with a counterpart executed by each of the
other parties hereto, shall be an original and all of which shall
constitute but one and the same instrument.
Section 14.03 - Applicable Law. This Trust Indenture shall
be construed and enforced according to the laws of the State.
Section 14.04 - Severability of Provisions. If any one or
more of the covenants, agreements or provisions herein contained
shall be.held contrary to any express provisions of law or con-
trary to the policy of express law, though not expressly prohi-
bited, or against public policy, or shall for any reason whatso-
ever be invalid, then such covenants, agreements or provisions
shall be null and void and shall be deemed separable from the
remaining covenants, agreements or provisions and shall in no way
affect the validity of any of the other provisions hereof.
Section 14.05 - No Usury. Notwithstanding anything herein,
or in the .Lease Purchase Agreement or the Certificates or other-
wise, the Issuer and the Lessee shall have no obligation to pay,
and neither the Owners of Certificates nor MBIA shall charge
interest or charges in the nature of interest that would violate
any legally binding limitation on interest rates. The Trustee
shall not be responsible for determining usury and must disburse
according to this Trust Indenture absent a final court order to
the contrary from a court having jurisdiction over this Trust
Indenture.
Section 14.06 - Survival Provisions. The obligations of the
Trustee wi~h respect to matters arising before the termination of
this Trust Indenture (including any indemnification obligations
and any obligation to pay additional interest) shall survive the
termination of this Trust Indenture.
Section 14.07 - Limited Third Party Beneficiaries. No per-
sons other than the Trustee, the Issuer, the Lessee, MBIA and the
Owners of Certificates; and the successors and assigns of such
persons, shall have any rights whatsoever under this Trust
!ndentu~e.
59
Section 14.08 - No~ices. Any notices to be given or to be
served upon any party hereto, in connection with this Trust
Indenture, must be in writing and may be delivered personally or
by certified or registered mail, return receipt requested and, if
so mailed shall be deemed to have been given and received
forty-eight (48) hours after a registered or certified letter
containing such notice, postage prepaid, is deposited in the
United States mail, and if given otherwise, shall be deemed to
have been given when delivered to and received by the party to
whom it is addressed, such notice shall be given to the perties at
their respective addresses set forth in Exhibit C to the Lease
Purchase Agreement or at such other address as such party may
hereafter designate to the other parties in writing.
Section 14.09. - Reference Date. This Trust Indenture is
dated as of the date set forth above for convenience of reference
only. The actual date o~ execution hereof by each party hereto is
set forth below the respective signatures for each party below.
[remainder of page intentionally left blank]
60
IN WITNESS WHEREOF, each of the parties hereto have caused
this Trust Indenture to be executed by their duly authorized
officers or agents, all as of the day and year indicated above and
effective the Issue Date.
[NAME OF TRUSTEE]
(SEAL) By:
ATTEST: Title:
CITY OF SANFORD FINANCE
CORPORATION
(SEAL)
By:
ATTEST: President
Secretary/Treasurer
62
ACCEPTANCE BY CITY
The City of Sanford, Florida, hereby affirms that, at a duly
constituted meeting of the City Commission of the City of Sanford,
Florida on the day of , 1989, it accepted the
terms of this Trust Indenture and the execution of this Acceptance
by , and does hereby agree to be bound
by the same.
CITY OF SANFORD, FLORIDA, as
Lessee
( SEAL )
By:
ATTEST: Mayor
Date: , 1989
City Clerk
63
SCHEDULE I
TO
TRUST INDENTURE
Qualified Investments
1. Direct and general obligations of the United States of
America, or obligations that are unconditionally guaranteed as
to principal and interest by the United States of America,
including (in the case of direct and general obligations of
the United States of America) evidences of direct ownership of
proportionate interests in future interest or principal pay-
ments of such obligations. Investments in such proportionate
interests must be limited to circumstances wherein (a) a bank
or trust company acts as custodian and holds the underlying
United States obligations; (b) the owner
the real party in 'interesh and has the right to proceed
directly and individually against the obligor of the underly-
ing United States obligations; and (c) the underlying United
States obligations are held in safekeeping in a special
account, segregated from the custodian's general assets, and
are not available to satisfy any claim oE the custodian, any
person claiming throUg~h__the custodian, or any person to whom
the custodian may be obligated. The obligations described in
this paragraph are hereinafter called "United States Obliga-
tions."
2. Obligations issued or guaranteed by the following instrumen-
tallties or agencies of the United States of America:
(a) Federal Home Loan Banks;
(b) Government National Mortgage Association;
(c) Farmers Home Administration;
(d) Federal Home Loan Mortgage Corporation;
(e) Federal Housing Administration; and
(f) Federal National Mortgage Association.
3. Direct and general long-term obligations of any state, to the
payment of which the full faith and credit of the state is
pledged and that are rated "Aaa" by Moody's Investors Service,
Inc. (hereinafter referred to as "Moody's") and "AAA" by
Standard and Poor's Corporation' (hereinafter referred to as
"S&P").
4. Direct and general short-term obligations of any state to the
payment of which the full faith and credit of the state is
pledged and that are rated in the highest rating category by
Moody's and S&P.
5. Interest-bearing demand or time deposits issued by state banks
or t~ust companies or national banking associations that are
members of the Federal Deposit Insurance Corpo~az~on
by savings and loan associations that are members oE the
I-1
Federal Savings and Loan Insurance Corporation (FSLIC). These
deposits must (a) be continuously and fully insured by FDIC or
FSLIC and be with banks whose debt is rated at least "P-l" or
"Aa" by Moody's and at least "A-l" oF "AA" by S&P, or (b) be
secured by United States Obligations at the levels described
in the last paragraph of this definition and (if such deposits
have maturities of not more than 365 days) be with banks the
short-term debt of which is rated "A-l+" by S&P and "P-l" by
Moody's or (if such deposits have maturities of more than 365
days) be with banks the long-term debt of which is rated ~AA"
Or better by S&P and "Aa" or better by Moody's. The United
States Obligations must be held by the Trustee (who shall not
be the provider of the collateral), or by a Federal Reserve
Bank Or Depository, as custodian for the Trustee. The Trustee
shall have a perfected first lien in the United States Obliga-
tions serving as collateral, such collateral shall be free
from all third-party liens and claiM, and failure to maintain
the requisite collateral level after the restoration period
described in the last paragraph of this definition shall
entitle the Trustee to liquidate the collateral.
6. Repurchase agreements, the maturities of which. are 30 days or
less, entered into with financial institutions such as banks
or trust companies organized under state law or national bank-
ing associations, insurance companies or government bond
dealers reporting to, trading with, and recognized as a pri-
mary dealer by, the Federal Reserve Bank of New York and a
member of the Security Investors Protection Corporation or
with a dealer or parent holding company, in each such case the
debt of which is rated at least "A" or "A-l" by S&P and at
least "A" Or "P-l" by Moody's. Such repurchase agreements
shall be in respect of United States Obligations and (except
repurchase agreements with institutions whose debt or commer-
cial paper is rated "AAA". or "A-I" by S&P and "Aaa" or "P-l"
by Moody's) shall be collateralized by United States Obliga-
tions the fair market value of which, together with the fair
market value of the repurchase agreement securities, shall be
maintained at the levels described in the last paragraph of
this definition, and the provisions of the repurchase agree-
ment shall meet the following additional criteria:
1. the Trustee (who shall not be the provider of the
collateral) or a third party acting solely as agent for the
Trustee has possession of the United States Obligations;
2. failure to maintain the requisite collateral levels
will require the Trustee to liquidate the United States Obli-
gations immediately;
3. the Trustee has a perfected, first priority security
interest in the United States Obligations; and
4. the United States ObiigaLions are free and
third-party liens, and in the case of an SIPC broker, were not
I-2
required pursuant to a repurchase or feverset repurchase
agreement.
7. Pre-funded municipal obligations rated "AAA" by S&P and "Aaa"
by Moody's and meeting the following conditions:
(a) the municipal obligations are (i) not to be redeemed
prior to maturity or the Trustee has been given
irrevocable instructions concerning their calling
and redemption and (ii) the issuer has covena~ted
not to redeem such municipal obligations other than
as set forth in such instructions;
(b) the municipal obligations are secured by cash or
United States Obligations that may be applied only
to interest, principal and premium payments of such
municipal obligations;
(c) the principal of and interest on the United States
Obligations (plus any cash in the escrow fund) are
sufficient to meet the liabilities On the municipal
obligations; '-
'(d) the United States Obligations serving as security
for the municipal obligations-are held l~F'an escrow
agent or trustee; and
(e) the United States Obligations (plus any cash in the
escrow fund) are not available to satisfy any other
claims, including those against the trustee or
escrow agent,
8. Prime commercial paper of a United States corporation, finance
company or banking insti.tution if such commercial paper is
rated at least "P-l" by Moody's and at least "A-l" by S&P and
if such commercial paper is stated to mature in not more than
365 days,
9, ~hares of a diversified open-end management investment company
(as defined in the Investment Company Act Of 1940) Or shares
in a regulated investment company (as defined in Section
851(a) of the Internal Revenue Code of 1986, as amended) that
is (A) a money market fund that has been rated in the highest
rating category by Moody's and "AAAm" Or ".~JL~mG by S&P or (B)
money market accounts of the Trustee or of any state or
federal bank the debt of which is rated at least "P-l" or
"Aaa" by Moody's and at least "A-l" Or ".~AA" by S&P or the
debt of whose one bank holding company parent is rated at
least "A-l+" or "AAA" by S&P and at least "P-l" or "Aaa" by
Moody's.
10. State Oooled investment funds approved by MBIA, S&P and
Moody' s and invested in any one or mote of the
described in paragraphs 1 through 9 of this definition.
I-3
COLLATERAL LEVELS FOR UNITED STATES OBLIGATIONS
The collateral levels referred to in paragraphs (5) and (7)
of this definition are set forth, and are-based on the assumptions
described below:
1 yr. 5 yrs. 10 yrs. 15 yrs. 30 yrs.
or less or less or less or less or less
AAA collateral levels (%)
Frequency of
valuation
Daily 103 106 107 109 116
Weekly 104 112 114 120 125
Monthly 107 123 130 133 143
Quarterly . 108 125 135 140 150
Assumptions: (1) On each valuation date, the market value of
the United States Obligations will be an amount equal to the
requisite collateral percentage of the agreement or deposit
(including unpaid accrued interest) that is being secured. (2)
The following restoration periods were assumed: one business day
for daily valuations, two business days for weekly valuations and
one month for monthly and quarterly valuations. The use of
different restoration periods may therefore-affect the requisite
collateral percentage. (3) Failure to maintain ~the requisite
collateral percentage after the restoration period will require
the Trustee to terminate their repurchase agreement and, if not
paid by the counter party in federal funds against transfer of the
repurchase agreement securities, to liquidate the collateral.
I-4
EXHIBIT A
TO TRUST INDENTURE
The Certificates aggregate principal amount and rates (Refer-
ence Section 2.03 of the Trust Indenture) are as follows:
Certificate
Certificate Payment Aggregate Interest
Maturity Date Dates Amount Rate
B. The "First Optional Redemption Date" is
2) Capitalized Interest (Reference Section 6.06 of the Trust
Indenture) is as follows:
The "Capitalized Interest Account Deposit" is $
which together with earnings is to be disbursed as follows:
Date Amount
3) ApplicatiOn of Proceeds (Reference Section 5.02 of the Trust
Indenture)
The Proceeds equal $ and are to he deposited as
follows:
A. In the Project Fund:
- To the credit of the Acquisition Account $
- To the credit of the Costs of Issuance Account
- To the credit of the Capitalized Interest
Account
Bo In the Rent Payment Fund:
To the credit of the Rent Payment Fund
(accrued interest)
C. To the credit of the Reserve Fund
Total Deposits
$
EXHIBIT B
FORM OF CERTIFICATE' OF PARTICIPATION
[to be provided]
EXHIBIT C
TO TRUST INDENTURE
Form of Notice of Substantial Completion
[Letterhead of Issuer]
· as Trustee
Pursuant to the provisions of Sections 6.02.3(e) of that
certain Trust Indenture, dated as of 1, 1989, between
as Trustee and the City of Sanford Finance Corporation, as Issuer,
you are hereby notified that "substantial completion" for purposes
of Section 6.02.2 of the Trust Indenture has occurred.
CITY OF SANFORD FINANCE
CORPORATION
Title:
BM&O DRAFT
09/22/89
2100.3
DEFINITION EXHIBIT
"Acceptance Expiration Date" shall mean the Acceptance Expir-
ation Date set forth in Exhibit C to the Lease Purchase
Agreement.
"Acquisition Completion Date" shall mean the earlier of (i)
the Acceptance Expiration Date or (ii) the Completion Date.
"Act" shall mean Chapter 166, Florida Statutes, [and City of
Sanford Charter and any applicable ordinance] as [each] may from
time to time be supplemented or amended.
"Acquisition Contract" shall mean, collectively, (i) with
respect to items of Equipment, the Vendor Contract pursuant to
which same is being acquired by the Lessee and (ii) with respect
to components of the Project which are not Equipment, the Develop-
ment Agreement.
"Additional Interest" shall mean interest at_ ~he Overdue
Rate accrued as Supplemental Rent under the Lease Purchase
Agreement.
"Applicable Law" shall mean all applicable provisions of all
constitutions, statutes, rules, regulations and orders of all
governmental and quasi-governmental bodies, all Governmental
Approvals and all orders, judgments and decrees of all courts and
arbitrators.
"Architect" shall mean. the Person identified as "Architect"
in Exhibit C to the Lease Purchase Agreement.
"Assignment" shall mean the Assignment of Lease Agreement by
the Lessor to the Trustee assigning all of the Lessor's rights
under the Lease Purchase Agreement to the Trustee for the benefit
of the Owners of the Certificates.
"Attorneys' Fees" shall mean reasonable attorneys' fees and
paralegals' fees and court costs through all trial and appellate
levels and post-judgment proceedings.
"Authorized Denominations" shall mean $5,000, or any integral
multiple of $1,000 in excess thereof.
"Authorized Representative" shall mean (1) with respect to
the Lessee, the Financial Officer or any other person designated
by the Lessee as an Authorized Representative of the Lessee
appointed b~~ the L~ssee and designated as such in a ceFtificate
filed with the Trustee and (2) with respect tO the Lessor, any
person or persons designated as Authorized Representative by the
Lessor to the Trustee in writing.
"Balance Due Lessor" shall mean the applicable amount as
described in Section 2.8 of the Lease Purchase Agreement.
"Basic Rent" Or "Basic Rent Payment" shall mean the Basic
Rent Payments set forth in Exhibit C to the Lease Purchase Agree-
ment,
"Basic Rent Payment Date" shall mean each Basic Rent Payment
Date set forth in Exhibit C to the Lease Purchase Agreement.
"Budget" shall mean the Budget for the Project set forth in
Exhibit D to the Lease Purchase Agreement.
"Building" shall mean the fire station to be constructed on
the Land.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks located in the U.S. city in
which the Principal Office of the Trustee is located are required
or authorized by law to remain closed or on which the New York
Stock Exchange is closed.
"Capitalized Interest Account" means the Capitalized Interest
Account created and established within the Project Fund by the
Trustee pursuant to Section 5.01(a) of the Trust Indenture with
respect to the Certificates and the Proceeds.
"Certificate Documents" shall mean, at any time, each of. the
following as in effect or as outstanding, as the case may be at
such time: (i) the Certificates, (ii) the Trust Indenture, (iii)
the Certificate Purchase Contract, (iv) the Lease Purchase Agree-
ment, ( v ) the Ass ignment, ( vi ) the Development Ag teemerit, and
(vii) the Collateral Assignment.
"Certificate Interest Payment" shall mean the Certificate
Payments representing undivided interests in the Interest Portion
of the Basic Rent Payments under the Lease Purchase Agreement.
"Certificate Interest Payment Date" shall mean a Basic Rent
Payment Date upon which an Interest Portion of Basic Rent Payment
is due.
"Certificate Maturity Date" shall mean the date upon which
the Certificate Principal Payment represented by such Certificate
matures.
"Certificate Owners" or "Owners" shall mean the registered
owners of the Ce~Lificau,:~ of ParLicipaLion in accoFdance '~ith
Trust Indenture.
2
"Certificate Payment Date" shall mean each semi-annual Certi-
ficate Payment Date.
"Certificate Payments" shall mean the Certificate Principal
Payments and the Certificate Interest Payments.
"Certificate Principal Payment" shall mean the Certificate
Payments representing undivided interests in the Principal Portion
of a Basic Rent Payment under the Lease Purchase Agreement.
"Certificate Principal Payment Date" shall mean a Basic Rent
Payment Date upon which a Principal Portion of Basic Rent Payment
is due.
"Certificate Purchase Contract" shall mean the Certificate
Purchase Contract dated , 1989, between the Lessor and the
Underwriter and joined ~n and consented to by the Lessee.
"Certificate Register" or "Register" shall mean the register
provided for by Section 2.09 of the Trust Indenture and kept for
such purpose by the Trustee with respect to the C~rtificates.
"Certificate Year" shall mean each twelv~ (12) month period
beginning and ending on
"Certificates" or "Certificates of Participation" shall mean
the Certificates of Participation, executed, authenticated and
delivered by the Trustee pursuant to the Trust Indenture.
"City" shall mean the City of Sanford, Florida, a municipal
corporation and a political subdivision of the State of Florida.
"City Clerk" shall mean the Clerk of the City Commission of
the City of Sanford, Florida~
"Code" shall mean the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder.
"Collateral Assignment" shall mean the Collateral Assignment
of Development Agreement by the City to the Trustee.
"Commission" shall mean the City Commission of the Lessee.
"Completion Date" shall mean the actual date of completion of
the acquisition, construction and equipping of all portions of the
Project.
"Concluding Payment" shall mean, as of any Basic Rent Payment
Date, that amount which (assuming the Basic Rent Payment due on
that date has been made) is necessary to prepay all of the Certi-
ficate Principal Payments evidenced by the Outstanding Certifi-
~ .... , ~.~-~c,,!n~ · . =..'~ _.rtlon, any, as forth i~
Exhibit C to the Lease Purchase Agreement and interest accrued
thereon to the Prepayment Date.
"Contractor" shall mean the Person designated as such pursu-
ant to the Lease Purchase Agreement.
"Costs" shall mean the costs (other than Costs of Issuance)
identified in the Budget which shall include all costs of con-
struction and may include, but are not limited to, interest under
the Lease Purchase Agreement, but only during the period prior to
placing the Project in service, and may also include items such as
site preparation, architectural and engineering fees, design fees,
development fees and other fees for professional services related
to the design or construction of such Project, the Lessee's admi-
nistrative expenses related to the Project and may also include
the cost of functionally related equipment and construction
management fees, if any, and any similar fees or costs.
"Costs of Issuance" shall mean the expenses incurred in
issuing the Certificates~ including without limitation, advertis-
ing and printing costs, financial advisors and counsel fees (which
may include fees for Counsel to the Lessee and the Lessee's admin-
istrative expenses related to the financing of the. Project) under-
writing and placement fees and commissions, municipal bond insur-
ance premiums, initial fees and expenses (including counsel fees)
of the Trustee, paying agents and certifying or authenticating
agents.
"Costs of Issuance Account" shall mean the Costs of Issuance
Account created and established within the Project Fund by the
Trustee pursuant to Section 5.01(a) of the Trust Indenture with
respect to the Certificates and the Proceeds.
"Dated Date" shall mean 1, 1989, the Dated Date of the
Certificates.
"Developer" shall mean ,
"Development Agreement" shall mean the Development Agreement
dated as of 1, 1989, between the Lessee and the Developer.
"Directire" shall mean an instrument in writing executed in
one or more counterparts by the Owners of the Certificates, as
determined from the records of the Trustee pursuant to Section
2.09 of the Trust Indenture, or their lawful attorneys-in-fact,
representing no less than fifty-one percent (51%) of the aggregate
Certificate Principal Payments represented by the then Outstanding
Certificates or by MBIA if a Municipal Bond Insurance Policy is in
effect.
"Draw Schedule" shall mean the timetable for disbursements
from the Project Fund for acquisition, construction and equipping
of the Project as set forth in Exhibit D to the Lease Purchase
Agreement.
4
"Endorsements" shall mean Endorsements to the Title Insurance
Policy issued by the Title Issuing Agent on behalf of the Title
Insurance Company with respect to each Requisition relating to the
Building and updating status of title and increasing the face
amount of such policy as required.
"Equipment" shall mean, collectively, the items of personal
property included in the Project.
"Estimated Completion Date" shall mean the Estimated Comple-
tion Date set forth in Exhibit C to the Lease Purchase Agreement.
"Event of Default" shall mean the occurrence of an Event of
Default under Section ]0.01 of the Trust Indenture.
"Event of Extraordinary Redemption in Part" shall have the
meaning set forth in Sec%ion 4.03.1 of the Trust Indenture.
"Event of Extraordinary Redemption in Whole" shall have the
meaning set forth in Section 4.03.1 of the Trust Indenture.
"Event of Lease Default" shall mean the occurrence of an
Event of Default under Section 11 of the Lease Purchase
Agreement.
"Event of Mandatory Prepayment" shall mean the occurrence of
an event described in Section 16.2 of the Lease Purchase Agree-
ment.
"Event of Non-Appropriation" shall have the meaning set forth
in Section 2.6.1 of the Lease Purchase Agreement.
"Event of Optional Redemption" shall mean a redemption des-
cribed in Section 4.02 of the Trust Indenture.
"Event of Special Mandatory Redemption" shall mean a redemp-
tion described in Section 4.03.2 of the Trust Indenture.
"Event of Special Optional Redemption" shall mean a redemp-
tion described in Section 4.02.1 of the Trust Indenture.
"Event of Special Redemption" shall mean, collectively, the
occurrence of either an Event of Special Mandatory Redemption or
an Event of Special Optional Redemption.
"Extraordinary Redemption Fund" shall mean the Extraordinary
Redemption Fund so designated and established pursuant to Section
5.01(d) of the Trust Indenture.
"Final Payment" shall have the meaning set forth in Section
8.04 of the Trust Indenture.
5
"Final Payment Date" shall mean the Final Payment Date set
forth in Exhibit A to the Trust Indenture which is the Certificate
Maturity Date.
"Financial Newspaper or Journal" shall mean The Wall Street
Journal or The Bond Buyer Or any other other newspaper or journal
containing financial news, printed in the English language, cus-
tomarily published on each business day with a national circula-
tion and customarily relied upon by the financial community, and
selected by the Trustee, whose decision shall be final and
conclusive.
"Financial Officer" shall mean the Director of Finance of the
Lessee.
"First Optional Redemption Date" shall mean the First
Optional Redemption Date set forth in Exhibit A to the Trust
Indenture.
"Fiscal Year" shall mean each twelve-month period beginning
October 1 and ending on the next succeeding September 30.
"Governmental Approval" shall mean an authorization, permit,
consent, appr~_~al, license or exemption from, registration or
filing with, or report to, any governmental or regulatory unit.
"Governmental Obligations" shall mean United States Obliga-
tions as defined in paragraph (1) of Schedule I to the Trust
Agreement.
"Independent Insurance Consultant" shall mean a nationally
recognized, independent actuary, insurance company or broker
acceptable to MBIA that has actuarial personnel experienced in the
area of insurance for which the Lessee is to be self-insured.
"Initial Lease Term" and "Renewal Lease Terms" shall mean,
respectively, the Initial Lease Term and the Renewal Lease Terms
set forth in Exhibit C to the Lease Purchase Agreement.
"Initial Lease Termination Date" shall mean the termination
date of the Initial Lease Term set forth in Exhibit C to the Lease
Purchase Agreement.
".Insurance Trustee" shall mean , as
Insurance Trustee for MBIA.
"Interest Portion" shall mean the portion of each Basic Rent
Payment constituting interest as evidenced by the Certificates.
"Interest Rate" shall mean the Interest Rate set forth in
Exhibit C to the Lease Purchase Agreement.
"Investment Property" shall mean "investment property" as
such term is used in the Code with respect to Sections 103 and 148
of the Code.
"Issue Date" shall mean , 1989.
"Item Purchase Price" shall mean the portion of the total
invoice cost to be financed under the Lease Purchase Agreement
(which may include charges for installation, delivery or prepara-
tion, on-site testing, or similar charges) for an item of Equip-
ment, as identified in the Requisition submitted to the Trustee
for payment for such item of Equipment.
"Land" shall mean the real property described in Exhibit B to
the Lease Purchase Agreement.
"Lease Commencement ,Date" shall mean the Lease Commencement
Date set forth in Exhibit C to the Lease Purchase Agreement.
"Lease Purchase Agreement" shall mean the Lease Agreement
with Option to Purchase dated as of 1, 1989, between the
Lessee and the Lessor.
"Lease Purchase Rent" or "Lease Purchase Rent Payments" shall
mean, collectively, Basic Rent, Supplemental Rent and all other
amounts due under such Lease Purchase Agreement.
"Lease Purchase Revenues" shall mean all amounts paid and
collected pursuant to or with respect to the Lease Purchase Agree-
ment, including, without limiting the generality of the foregoing,
all payments of Lease Purchase Rent, prepayments, Net Proceeds of
insurance, or condemnation proceeds, and any and all interest,
profits or other income derived from the investment thereof in the
Lessee's Funds established pursuant to the Trust Indenture.
"Lease Rights" shall have the meaning set forth in Section
16.1 of the Lease Purchase Agreement.
"Lease Term" shall mean collectively, the Initial Lease Term
and all exercised Renewal Lease Terms.
"Lease Termination Date" shall have the meaning set forth in
-Exhibit C to the Lease Purchase Agreement.
"Lessee" shall mean the City of Sanford, Florida, a municipal
corporation and a political subdivision of the State of Florida.
"Lessee's Funds" shall mean, collectively, the Project Fund,
the Rent Payment Fund, the Optional Redemption Fund, the Extra-
ordinary Redemption Fund, the Special Redemption Fund and the
Reserve Fund.
7
"Lessor" shall mean the City of Sanford Finance Corporation,
a Florida not-for-profit corporation, as lessor under the Lease
Purchase Agreement, and, pursuant to the Assignment, the Trustee,
and its successors under the Trust Indenture.
"Lien", as applied to the property of any Person, shall mean
(in each case, whether the same is consensual or nonconsensual or
arises by contract, operation of law, legal process or otherwise):
(a) any mortgage, lien, pledge, attachment, charge, finance,
lease, conditional sale or other title retention agreement, or
other security interest or encumbrance of any kind in respect of
any property of such Person, or upon the income or profits there-
from; and (b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise
identified for the purpose of securing indebtedness or performance
of any other obligation in priority to the payment of the general
unsecured creditors of such Person.
"Materially Adverse Effect" shall mean, (a) with respect, to
any Person, a materially adverse effect upon such Person's
business, assets, liabilities, financial conditien, results of
operations or business prospects and (b) with respect to any
agreement or obligation, a materially adverse effect upon the
binding nature, validity or enforceability of such agreement or
obligation.
"Maximum Cost" shall mean the Maximum Cost set forth in Exhi-
bit C to the Lease Purchase Agreement.
"Maximum Interest Rate" shall mean as of any date of deter-
mination the lesser of (i) 18% per annum and (ii) the maximum
non-usurious rate of interest allowed under the laws of the State
of Florida.
"Maximum Lease Term" shall mean the Maximum Lease Term set
forth in Exhibit C to the Lease Purchase Agreement.
"MBIA" shall mean Municipal Bond Insurance Association and
its successors.
"Minimum Optional Redemption Amount" shall mean the amount so
designated and set forth in Exhibit C to the Lease Purchase
Agreement.
"Moody's" shall mean Moody's Investors Service, Inc., a cor-
poration organized and existing under the laws of the State of
Delaware, its successors and their assigns, and, if such corpora-
tion shall be dissolved or liquidated or shall no longer perform
the functions of a securities rating agency, "Moody's" shall be
deemed to refer to any other nationally recognized securities
rating agency.
8
"Municipal Bond Insurance Policy" shall mean the municipal
bond insurance policy issued by MBIA simultaneously with the deli-
very of the Certificates, insuring the payment of the Certificate
Principal Payments and the Certificate Interest Payments.
"Net Proceeds" shall mean proceeds from any insurance, con-
demnation award, performance bond, or any other financial guaranty
(except that Net Proceeds shall not include any proceeds of the
Municipal Bond Insurance Policy) or sale paid with respect too or
for the Project (including the Land) remaining after payment
therefrom of all expenses including attorney's fees incurred in
the collection thereof; and, with respect to insurance, to the
extent that the Lessee selects to self-insure under section 9(c)
[or 20.3.5] of the Lease Purchase Agreement, any moneys payable
from any appropriation to the Lessee in connection with such self-
insurance.
"Non-Ad Valorem Revenues" shall mean all non-ad valorem reve-
nues received by the Lessee except to the extent same are now or
hereafter pledged to payment of obligations of the Lessee.
"Notice by Mail" or "notice" of any action or condition "by
Mail" shall mean a written notice meeting the requirements of the
Trust Indenture mailed by first-class mail to the Owners of speci-
fied Certificates, at the addresses shown on the Certificate
Register maintained pursuant to Section 2.09 of the Trust Inden-
ture.
"Notice of Commencement" shall mean a Notice of Commencement
duly executed in recordable form and meeting the requirements of
Chapter 713, Florida Statutes.
"Notice of Substantial Completion" shall mean a Notice of
Substantial Completion substantially in the form of Exhibit C to
the Trust Indenture.
"Offering Circular" shall mean the Offering Circular relating
to the Certificates dated the date of the Certificate Purchase
Contract and any documents incorporated therein by reference.
"Option" shall mean the purchase option in favor of Lessee
set forth in Section 17.2 of the Lease Purchase Agreement.
"Option Price" shall have the meaning set forth in Section
17.2(a) of the Lease Purchase Agreement.
"Option Notice" shall have the meaning set forth in Section
17.2(c) of the Lease Purchase Agreement.
"Optional Redemption" shall mean an Optional Redemption of
the Principal Portion of Certificate Principal Payments represent-
Payment pursuant to Section 4.02 of the Trust Indenture.
"Optional Redemption Fund" shall mean the Optional Redemption
Fund so designated and established pursuant to Section 5.01(c) of
the Trust Indenture.
"Outstanding" shall mean, as of the date of determination all
Certificates theretofore issued, authenticated and delivered pur-
suant to the Trust Indenture except (i) Certificates theretofore
cancelled by the Trustee or surrendered to the Trustee for cancel-
lation, (ii) Certificates for the transfer or exchange of oc in
lieu of or in substitution for which other certificates shall have
been authenticated and 'delivered by the Trustee pursuant to the
Trust Indenture, (iii) Certificates which have been deemed sur-
rendered for redemption or mandatory purchase and for which the
Trustee' holds in trust for the Owners the Redemption Price oF the
purchase price of such Certificates, and (iv) Certificates paid or
deemed to be paid pursuant to Article XII Of the Trust Indenture.
"Overdue Rate" shall mean, with respect to Supplemental Rent
owed to any Person, the Maximum Rate.
"Owner" or "Certificate owner" shall mean the owner of a
Certificate as shown on the Certificate Register kept pursuant to
Section 2.09 of the Trust Indenture.
"Paying Agent" shall mean the Trustee.
"Permitted Encumbrances" shall mean encumbrances described in
Schedule B to the Title Insurance Policy.
"Person" shall mean an individual, a corporation, a partner-
ship, an association, a joint stock company, a trust, any unincor-
porated organization or a government or political subdivision
thereof or any other entity.
"Plans and Specifications" shall mean the plans and specifi-
cations as described in Section 6.02.1(a) of the Trust Indenture.
"Premium Portion" shall mean the Premium Portion, if any, of
Basic Rent Payment due under the Lease Purchase Agreement upon an
Optional Redemption.
"Prepayment Option" shall mean the right of the Lessee to
prepay the amounts due under the Lease Purchase Agreement pursuant
to ~ection 17.1 thereof.
"Principal and Interest Payments" shall mean the payments of
principal and interest to be made by the Lessee pursuant to the
schedule of Basic Rent Payments set forth in Exhibit C of the
Lease Purchase Agreement.
"Principal Office" of the Trustee Or the Paying Agent shall
mean the D~inci~al coroorate trust office of the Trustee initially
~ocaLe~ in
10
"Principal Portion" shall mean the portion of each Basic Rent
Payment constituting principal, if any, as evidenced by the Certi-
ficates.
"Proceeds" shall mean the aggregate moneys paid by the Under-
writer for the Certificates to the Trustee, less any applicable
Underwriter's discount or original issue discount.
"Project" shall mean the Project as set forth on Exhibit E to
the Lease Purchase Agreement.
"Project Fund" shall mean the Project Fund created and esta-
blished with the Trustee pursuant to Section 5.01(a) of the Trust
Indenture with respect to the Proceeds and the Project which con-
sists of the Acquisition Account, the Capitalized Interest Account
and the Costs of Issuance Account.
"Qualified Investments" shall include any of the securities
set forth on Schedule I to the Trust Indenture, if and to the
extent the same are at the time legal under State law for invest-
ment of the Lessee's Funds.
"Real Estate Taxes" shall mean all real estate taxes, public
and governmental charges and assessments, including all extraor-
dinary or special assessments, or assessments against any of
Lessor's personal property included in the Project, all costs,
expenses and attorneys' fees incurred by the Lessor in contesting
or negotiating with public authorities as to any of same and all
sewer and other similar taxes and charges.
"Rebate Account" shall mean the Rebate Account created and
established with the Trustee pursuant to Article VII of the Trust
Indenture with respect to the Lease Purchase Agreement.
"Record Date" shall mean fifteen (15) days prior to each
Certificate Payment Date.
"Redemption Date" shall mean with respect to a Certificate,
its Redemption Date as set in accordance with Article IV of the
Trust Indenture.
"Redemption Fund" shall mean, collectively, the Extraordinary
Redemption Fund, the Optional Redemption Fund and the Special
Redemption Fund.
"Redemption Price" shall mean, with respect to any Certifi-
cate (or portion thereof) the Certificate Principal Payments
represented by such Certificate (or portion thereof) including the
Premium Portion, if any, plus the Certificate Interest Payments
accrued thereon, if any, to the Redemption Date payable upon pre-
sentment thereof pursuant to Article IV of the Trust Indenture.
11
"Registrar" shall mean the Trustee, or its successor as
Registrar.
"Renewal Term Termination Date" shall mean the termination
date for such Renewal Agreement Lease Term set forth in Exhibit C
to the Lease Purchase Agreement.
"Rent" Or "Rent Payments" shall mean, collectively, Basic
Rent, Supplemental Rent and all other amounts due under the L~ase
Purchase Agreement.
"Rent Payment Fund" shall mean the fund by that name esta-
blished pursuant to Section 5.01(b) of the ~rust Indenture.
"Requisition" shall mean a completed Requisition in the form
of Exhibit A to the Lease Purchase Agreement.
"Reserve Deficiency" shall mean the amount by which the
balance in the Reserve Fund, from time to time, is less than the
Reserve Requirement.
"Reserve Fund" shall mean the Reserve Fund created pursuant
to Section 5.01(e) of the Trust Indenture.
"Reserve Requirement" shall mean an amount equal to $
which shall be deposited to the Reserve Fund on the Issue Date
from Proceeds.
"Resolution" shall mean the Resolution of the Commission of
Lessee adopted on , 1989.
"Serial Certificates" shall mean Certificates with a Certi-
ficate Principal Payment Date on or before
"Special Counsel" shall mean Bryant, Miller and Olive, P.A.,
Tallahassee, Florida, or any other law firm of nationally recog-
nized bond counsel familiar with the transactions contemplated
under the Certificate Documents.
"Special Redemption Fund" shall mean the Special Redemption
Fund created pursuant to Section 5.01(f) of the Trust Indenture.
"Standard & Poor's" or "S&P" shall mean Standard & Poor's
Corporation, a corporation organized and existing under the laws
of the State of New York, its successors and their assigns, and if
such corporation shall be dissolved or liquidated or shall no
longer perform the functions of a securities rating agency, "S&P"
shall be deemed to refer to any other nationally recognized secur-
ities rating agency.
"State" shall mean the State of Florida.
"Stipulated Loss Value" shall mean the Stipulated Loss Value
computed pursuant to Section 15 of the Lease Purchase Agreement.
"Supplemental Rent" shall have the meaning set forth in Sec-
tion 2.4 of the Lease Purchase Agreement.
"Term Certificates" shall mean Certificates with a Certifi-
cate Principal Payment Date on or after
"Third Party Assignment" shall mean, with respect to any
Vendor Contract, the assignment of the Lessee's right to acquire
the Equipment described in the Vendor Contract for the purchase
price set forth therein. 0
"Title Insurance .Commitment" shall mean the Commitment for
Title Insurance No. dated , 1989 issued by the
Title Issuing Agent on behalf of the Title Insurance Company and
showing the Lessor as Owner of the Land.
"Title Insurance Company" shall mean
"Title Insurance Policy" shall mean the Policy of Title
Insurance to be issued by the Title Issuing Agent on behalf of the
Title Insurance Company pursuant to the Title Insurance Commit-
ment.
"Title Issuing Agent" shall mean "
, Florida.
"Trust Indenture" or "Certificate Trust Indenture" shall mean
the Trust Indenture dated as of 1, 1989, between the Trustee
and the Lessee.
"Trust Estate" shall mean, collectively, the moneys, funds
and rights set forth in the granting clause of the Trust Inden-
ture.
"Trustee's Expenses" shall mean, collectively, all Out-of-
pocket expenses, disbursements and advances (including reasonable
attorneys' fees) incurred by the Trustee under the Trust Indenture
in connection with the Certificates and the Trust Estate.
"Trustee" shall mean
, as Trustee under the Trust Inden-
ture and its successors thereunder.
"Underwriter" shall mean William R. Hough & Co. ,
St. Petersburg, Florida.
"Vendor" shall mean, with respect to an item of Equipment,
the seller thereof to the Lessee or the Trustee as assignee of the
Lessee's rights under the Vendor Contract.
"Vendor Contract" shall mean, with respect to an item of
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