R-74-240,; . ,
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RESOLUTION. N0. 240
J!
RESOLUTION) PROVIDI`:s FOR THE ACQUISITION,
CONSTRUCTION A*,D ~R~CTION OF EXTEt3SIONS Ai1D
Ii~IPROVi;.`iE~ITS TO ^:-?E '"ii.iCIPAL ZJATER AND
SE6dEP. SYSTEr-1; E?[:^i:02IZI.YG THE ISSUA:~TCE OF
NOT EXCEEDItiG $155, 000 6•~ATER AND SE6dER
REVENUE BOi~?D5 , SERIES 19 7 5, TO FIt~Ai`ICE
T'riE COST THEREOF; PLEDGING THE tdET REVE-
NUES OF SAID SYSTE_4, CERTAII.1 MUNICIPAL
EYCISE TAXES AND ALL t~10NEYS OF THE CITY
DERIVED FRO;~I SOURCES OTHER THAN AD VALOREM
TA.YATI ON ACID LEGALLY AVAI LABLE FOR SUCH
PURPOSE TO SECURE THE PAY~~iEidT THEREOF ; AND _
PROVIDING FOR THE RIGHTS OF THE HOLDERS OF
SUCH BONDS.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY Or^
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CLERPdON".P, FLORIDA, as follows
ARTICLE I ~-
GENERAL
(B} -The Issuer has been advised by its consulting
engineers that the cost of constructing the project in accordance
with said plans and specifications is estimated at $155,000,
wi~ich shall be paid with the proceeds of the sale of the bonds
herein authorized and shall•be deemed to include all expenses neces -
sary, appurtenant or incidental thereto, including the cost of any
land or interest trerein or' of an-,~ fixtures or equil~nent, or pro-
perty necessary or co.zvonient ti:nrsfor, the cost of labor and
1.01 Authority for this Resolution. This Resolution,
hereinafter called the "instrument," is adopted pursuant to the
provisions of Chapter 159, Part I, Florida Statutes, and other
applicable provisions of law.
1.02 FindincJs. It is hereby found ?nd determined that:
(A) For the benefit of its inhabitants, the City of
Clermont (hereinafter sometimes called the "Issuer"} presently
owns a water and sewer system (hereinafter sometimes referred to
as the "system"); and it is necessary for the continued preserva-
Lion of the health, welfare, convenience arid~safety of the Issuer
and its inhabitants to construct extensions and•improvements to
the system (hereinaz""ter referred to as the "project") in accord-
ance with certain plans and specifications now on file ~•rith the
City Clerk of the Issuer (hereinafter sometimes called the "Clerk").
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materials to complete such cols}..ruction, engineering and legal
expenses, fiscal expenses, expanses for estimates of costs and
revenues, expenses for plans, s~~cif ications and surveys, interest
during construction, if any, administrative expenses and all other
necessary miscellaneous expenses.
(C) (i) Pursuant to Section 167.431, Florida Statutes,
the Issuer did, on October 10, 1957, enact non-emergency Ordinance
No. 156 le~~ying and imposing a utilities services tax on every
purchase of electricity, gas (natural liquefied petrolem gas or
manufactured), water service, telephone service and telegraph service
within the corporate li^Iits of the Issuor.
Pursuant to law, the Issuer did on rIovember 17, 19 59 ,
under authority of an ordinance duly enacted, enter into an agree-
ment with Lake Apopka natural Gas District for a period of thirty
(30} years whereby the Issuer ~•rould receive a franchise tax by
reason of 'rlaving granted to La1;e Apopfia rdatural Gas District ::ze
rigclt to supply natural gas to the Issuer or its inIabitants.
Pursuant to law, the Issuer did,. on September 20, 1970,
under the authority of an ordinance duly enacted, enter into an
agree.~Ient wit;~I Florida Power and Light Company for a period of
thirty (30) years ~•rhereby the Issuer ~•rould receive a franchise tax
by reason of having granted to Florida Power and Light Company the
right to supply electric light and power facilities and services to
the Issuer or its inhabitants.
The proceeds to be derived by the Issuer from the
utilities services tax and-from the"franchise taxes are hereinafter
referred to as the "excise taxes."
(ii) The revenues to be derived annually from the
rates, rentals, fees and other c'rlarges made and collected for the
services and facilities of the system are estimated to be
$ ~'US.~Jy- and, together :•rith the proceeds. of the excise
tai;es will be sufficient to pay the principal and interest on the
prior lien obligations, hereinafter defined, and the bonds ;~erein
authori2ed as the sa.-no become duo and the annual cost of operating,
repairing and mair_taining the system, file aggregate annual amount o€
~~rhich is esti~ated to be $ ~~43, ?~~''~; ~ It is estimated that
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the period of usefulness of the system V;ill exceed forty-one years .
(D) It is deemed :_e~essary and desirable to pledge
the net revenues of the system and the proceeds of t'ne excise tares
to the payment of the principal of and interest on the bonds herein
authorized. No part of such revenues and excise taxes will be
pledged or hypothecated except with respect to the bonds herein
authorized, and except that ssch revenues and excise taxes have
been pledged first to the payment of the principal of and interest
on the Issuer's outstanding tidater and Sewer Revenue Bonds, dated
November 1, 1970, and ~4ater and Sewer Revenue Refunding Bonds,
Series 1972, dated November i, 1972, hereinafter sometimes referred
to as the "prior lien obligations". It is deemed necessary and
desirable to pledge as additional security for the payment of the
principal of and interest on the bonds all moneys of the Issuer
derived from sources other than ad valorem taxation which. shall
be legally available fvr such purpose.
(E) '! his instrumer.-~ is declared to be and sl:~il con-
stitute a contract betwedn the Issuer and the holders of all such
bonds; and the covenants and agreements herein set-forth to be
performed by the Issuer are and shall be for the equal benefit,
protection and security of the legal holders of any and all such
bonds issued under this instrument, all of which shall be of equal
rank and without preference, priority or distinction of any of
the bonds over any other, except as ~iereinafter provided.
(F) The Issuer is not, under this instrument, obligated
to levy any ad valorem taxes on any~real or personal property
situated within its corporate territorial limits to pay the prin-
cipal of or interest on the bonds hereinafter authorized or to pay
the cost of maintaining, repairing and operating the system. Such
bonds 1S5tled pursuant to this instrument shall not constitute a
lien upon the system or any., other property of the Issuer or situ-
ated c~rithin its corporate territorial limits.
1.03 Definitions. The follow~.ng terms in this instru-
ment shall have the follocaing mea::ings unless the text otherwise
e:;pressly requires:
(?) "Grass F:evenuos" derived from the opt ration of_ the
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system shall mean all :Honeys received from rates, fees, rentals
or other charges or income received by the Issuer or accruing
to it in the management and operation of the system, all calcu-
fated in accordance with sound accounting practice.
{B) "Operating Expenses" of the system shall mean
all current expenses, paid or accrued, for the operation, main-
tenance and repair of the system and its facilities, as calcu-
lated in accordance with sound accounting practice, and shall
include, w~.thout limiting the generality of the foregoing, in-
surance premiums, administrative expenses of the Issuer related
solely to the system, labor, cost of materials and supplies
used for current operation, and charges for the accumulation
of appropriate reserves for current expenses not annually recur-
rent but tahich are such as may reasonably be expected to be
incurred in accordance with sound accounting practice.. "Opera-
fling Expenses" shall not include any allowance for depreciation
or for renewals or replacements of capital assets of the system.
(C) "iJet Revenues" of the system shall mean the gross
revenues thereof, as defined in subsection (A), after deducting
therefrom only the operating expenses of the same, as defined in
subsection {B).
(D) "Fiscal Year" shall mean the period commencing
on October l of each year and continuing to and including the
succeeding September 30.
1.04 Project Authorized. The Issuer is hereby author-
ized to construct the project as defined in Section 1.02 (A) above.
ARTICLE II
AUTFiOP,IZ~ITION, TL•'Fi~IS. EXXECUTIO~ A~JD
REGISTF.ATI0~1 OF REVENUE BOJ~DS
2.01 Authorization of Revenue Bonds. Subject and pur--
suant to the provisions of this instrument, obligations of the
Issuer to be known as "City of C1erHOnt Water and Sewer P,everue
Bonds, Series 1975" (hereinafter so~Hetimes referred to as the
"bonds") are here:.~y authorized to ~e issued in an aggregate princi-
pal amount not e.~cceding One :iu:-tdred Fifty-five Thousand Dollars
(x155,000) for thn psrposo of ^roviding funds to may the cost of
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such project provic'.ed for in Se_tion 1,02 hereof.
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2.02 Description o 3onds. The bonds issued hereunder
shall be dated as of the date o~ their delivery; shall be in the
denomination of $1,000.00, or any multiple thereof, not exceeding
the amount maturing in each year; shall be numbered consecutively
from 1 upward; shall bear interest at not exceeding the legal
rate per annum, payable on September 1, 1975, and annually there-
after on. September 1 of each year; and shall mature serially in
numerical order on September 1 of each year in the years and
amounts as follo;•~:
YEAR AMOUNT YEAR AMOUNT YEAR AMOUNT
1973 $1,000 1991 $3,000 _ 2004 $5,000
1979 1,000 1992 3,000 2005 5,000
1980 1,000 1993 3,000 2006 6,000
1981 2,000 1994 3,000 2007 6,000
1982 2,000 1995 3,000 2008 6,000
1983 2,000 1996 3,000 2009 7,000
1984 _2,000 1997 4,000 2010 ~ 7,000
1985 2,000 1998 4,000 2011 7,000
1986 2,000 1999 4,000 2012 7,000
1987 ?.,000 2000 4,000 2013 8,C00
1938 2,000 2001 5,000 2014 8,000
1989 3,000 2002 5,000 2015 9,000
1990 3,000 2003 5,000
2.03 Places of Payment. Such bonds shall be issued
in coupon form; shall be payable as to both principal and interest
at such place or places as the Issuer shall hereafter by resolution
designate, in la:•~fu1 money of the United States of A*^.erica; and
shall bear interest from the date of iss»e, in accordance ~•~i th
and upon surrender of the appurtenant interest coupons as they
severally mature, unless registered; provided,. however, that bonds
held ;~y the United States of America, acting through the Earners
Nome Administration, U. S. Department of Agriculture, hereinafter
called tie "Government," shall b~ payable at "Finance Off ice, U. S.
Department of Agriculture, Far;aers Iio~ne Administration, 1520
t•Iar};et Street, St. Louis, t~iissouri 63103," or at such otter places
as the Government shall from. tine to time in :writing designate to
t:;e Is~u~~r.
2.04 Provisions for Rid^Mption. Bonds maturing on or
before September 1, 1935 are not subiect to rede:aption prior to
ti~:>ir resE=cctive stated dates o= maturity. Bonds maturing Septem:~er
1, 1936 anc? theree.fter shall, at the option of the issuer, he
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redeemable in whole or ir, pa.t, in inverse numerical and maturity
order, on September 1, 1985. or on any interest payment date there-
after at par and accrued interest, plus the following premiums,
expressed as percentages of the par value of the bonds so re-
deemed, it redeemed in the following years:
5~, if redeemed on September 1, 1985 or thereafter,
to and including September 1, 1983;
4$, if redee:,ted on Septe:.lber 1, 1989 er thereafter,
to and including September 1,.1992;
30, if redeemed on September 1, 1993 or thereafter,
to and including September 1, 1996;
2~, if redeemed on September. 1, 1997 or thereafter,
to and including September 1 , 2000;
1~, if redeemed on September~l, 2001 or thereafter,
to and ir_cluding~September 1, 2004;
t~Iithout prerniu~Tn, if redeemed September 1, 2005 or
thereafter, but prior to maturity;
provided, however, that at least thirty (30) days prior to the
redemption date ~,tritten notice of such redel-;;ption shall be given
to the paying agents for the bonds and to each or the registered
o~•~ners at their res;~ective addresses as they appear upon the re-
gistration books of the Clerk of the Issuer and shall be published
at least once in a financial news paper published in the City of
New York, New York. Bonds held by the Government-may bo redeered
by the Issuer on any interest payment date•prior to maturity at
the price of par and accrued interest, without,pre.~ium.
2.05 Execution of Bonds. The bonds shall be executed
in the na~-ne of the Issuer by its 2~ayor and the corporate seal of
the Issuer shall be impressed thereon, attested and countersigned
by its Clerk. In cast any one or more of the officers tiaho shall
have signed or ,sealed any of tho i~onds shall cease to be such
officer of the Issuer before the bonds so signed and sealed have
been actually sold and delivered, such bonds ray nevertheless be
sold and delivered as herein provided and may be issued as if .the
Person .~;io signed or sealed such bonds had not ceased to hold such
office. The validation certificate endorsed on the bonds shall
bo executed by the ,layor. any bon:'. :nwy be sinned and sealed on
behalf of th` Iss~:er by suc~1 ~~rson t~?~o at the acct;al time of the
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execution of such. bond s:~all ;:old the proper office of the Iss~zer,
although at the date of svc:~ bonds s»ch person may not have held
s»ch office or may not have b=az so authorised. The coupons
attached to the bonds shall be authenticated with the facsimile
signatures of any present or future ~•-iay^r and Clerk of the Issuer.
The Issuer may adopt and use for such p»rposPs the facsimile
signatures of any s~ich persons who shall have held such off ices
at any time after the date of the adoption of this instrument,
not~rith~:t-andincr that eit:-per or both shall h=ve ceased to hold
such office at the tine the bonds shall be actually sold and
delivered.
2.06 *~egotiability and P.ectisfsation. The bands shall
be and shall have all the qualities and incidents of negotiable
instruments under the law merchant and the La;~s of the State of
Florida, and each successive holder, in accepting any of the bonds
or the coupons appertaining thereto, shall b? conclusively deemed
to have agreed teat the bon: s shall be and 'nave all of s?id quali-
ties and incidents of negotiable instruments,
The b~r_ds may be registered, at th? option of the holder,
as to both orincinal and interest upon the books kept for the
registration and transfer of bonds by the~Clerk, as Bond Registrar,
and endorsed upon the bonds by the Bond Registrar in the sp?ce
provided thereon. After such registration, no transfer of the
bonds shall be valid unless made at the office of the Bond Registrar
by the registered oti~~ner or by his duly authorised agent or repre-
sentative and similarly noted on the bonds, b~~t at the expense
of the holder the bonds may be discharged from, registration by
being in like manner transferred to bearer, and thereupon trans-
ferability by delivery shall be restored. At the option and expense
of the holder, the Uonds may thereafter again from time to tite bo
registered or transferred to bearer as before. The Bond Registrar
s;1a11 not be requi red to na're any such transfer of bonds during
fifteen (I.5) days newt prece:ling ar. interest pay:~ent date on the
bonds or, in the case of any pronnsed redemption of bonds, after
Su•~fl [>OnCls have b~c~:? Se1L :i_~:i `or reCie:,?ptzOn. The person In ~•IhO.~iL
na,:~e any i~ord shall be regi s :ter°d shall k~e clec~; ^d zed regardccl as
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' th absolute owner thereof for all purposes, and payment of or
on account of the principal of any bond and the interest on any
bond shall be made only to or upon the order of the registered
owner thereof or his legal representative. All such payments
shall be valid and effectual to satisfy and discharge the liability
upon such bond including the interest thereon to the extent of
the sum or sums so paid.
2.07 Bonds P~utilated, Destroyed, Stolen or Lost, In
case any bond shall become mutilated, or be destroyed, stolen or
lost, the Issuer may in its discretion issue and deliver a new
bond of like tenor as the bond so mutilated, destroyed, stolen or
lost, in exchange and substitution for such mutilated bond, upon
surrender and cancellation of such mutilated bond, or in lieu of
and substitution for the bond destroyed, stolen or lost, and upon
the owner furnishing the Issuer satisfactory indemnity and comply-
ing with such other reasonable regulations and conditions as the
Issuer may prescribe and paying such expenses as the Issuer may
incur, All bonds so surrendered shall be cancelled by the Clerk.
If any such bonds shall have matured or be about to mature, instead
of issuing a substitute bond the Issuer may pay the same, upon
being indemnified as aforesaid, and if such bond be lost, stolen
or destroyed without surrender thereof.
t~ Any such duplicate bonds issued pursuant to this section
' shall constitute original, additional contractual obligations on the
part of the Issuer whether or not the lost, stolen or destroyed
bonds be at any time found by anyone, and such duplicate bonds
shall be entitled to equal and proportionate benefits and rights
as to lien on and source and security for payment from the funds,
as hereinafter pledged, to the same extent as all other bonds issued
hereunder.
2.03 Form of Bonds. The text of the bonds shall be in
substantially the follocaing~form, with only such omissions, inser-
tions and variations as may be necessary and desirable and appxoved
by the P~Iayor -prior to the issuance thereof (~•~hich approval rzay
be presumed by his exLcution of the bonds and the Issuer's delivery
of the bonds to thn purchaser thereof):
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tie.
UNITED S^ATES OF AMERICA
STA^1E OF FLORIDA
COU?~TY OF LP.KE
CITY OF CLER~IO~;T
P+ATER AhD SE'.^;ER REVENUE BOND
.SERIES 1975
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KNO'~rT ALL riEN BY THESE PP.ESENTS, that the City of Clermont,
a public body created and existing under and by virtue of the Laws
of the State of Florida (hereinafter sometimes referred to as the
"Issuer"), for value received, hereby promises to pay to the bearer,
or if this bond be registered to the registered holder as herein
provided, on the first day of September,l9_, from the special
funds hereinafter mentioned, the principal sum of
THOUS~AriD DOLLARS
and to pay interest thereon, from the date of the delivery of this
bond to the purchaser thereof, solely from said special funds, at
the rate of per centum ( $) per annum,
payable on Septe,:~ er 1, 1975 and annually thereafter on the first
day of Sep;:ember of each year upon the presentation and surrender
of the annexed coupons as they severally fall due. noth principal
of and interest on this bond are payable at _____ ,
in lawful money of the United States
of America.
~, This bond is one of an authorized issue of bonds in the
aggregate principal amount of $155,000 of like date,-tenor and
effect, except as to number, denomination, interest rate (if all
bonds do not bear the same rate of interest) and-date of maturity,
issued to finance the cyst of acquiring, erecting and constructing
extensions anti improvements to the combinea municipal water and
sewer system of 'the Issuer, hereinafter referred to as the "system",
under the authority of and in full compliance with the Constitution
and Statutes of the State of Florida, particularly Chapter 159,
Part I, Florida Statutes, and a resolution duly enacted by the
Issuer on ~ ; 1974 (herein referred ~tc~ as the
"Resolution"), and is subject to ail the terms and `conditions
o~ such Resolution.
This bond and the interest thereon are payable solely
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~`~! i ~~ ! ,i 7
s e ~ r' t ~1~~~ ~ } !r.,~s ,...~;~*~.Z~,wy~r+p~,-°-`^~s«strnrso:i~~,w4~'~.a~r~a~ ,' ~
frOn? cCnd SeC11rE'_;~ ,_,V a _zE'n pU__ ~__.C. _. ;~~ ~';~;:~' Oi ~.tli; T`. =: ': ::E'JE'i1U._':~
to b~' derrived fr. , t~Ie ope-~`i~ _~ ~. ~ ::}.~ s_,~:, ~-.:1, t.h_~ ~~ro . _ ~^ds a
CPitaln I(lUn1C1DT'.1 SXC1Se %d:<c~s :;I~_< <. T~a.~ 3~•:' C'~ x:1.1 iaOn~.'i:~ Of tt!E'
Issuer derived __o:^., so:zrce~; ot~-~~= ;.t:~:,~ ~:d ~.~a?.o~Y~~~:~ La:~~~t ~_on and
legally available for such pur~o~~~•, in t.'n-~ r;~.-:nr~>r dc,= cr_~:,~Yd in tha
Resolution. It is e:•cpz-essl~; acr:_ c~ ,`_~y th hol~?c~r o ` th i_: bond t'r~a.
the full faith ar;3 credit ~~~~ thE~ I_:;uer are not pledged t.o the
paymant of the principal of anc i.n`E:rest on this boI?d and that su^h
holdAr shall never have thr:~ rici~zt tc~ r`~~suire or c:orapel_ ct:e exercis~_~
of any taxing powar o-` the Issuer_ to the ;~a ;~:::~nt of such ~nrincipal
and interest or the co:;t of mainta ~_ninc;, cop .icing and operatinnz the
system. This bor_3 and the obiic~atic,n evidE'nc:d hereby shall not
constitute a lien upon the syste:r, or' any part. hereof or Twpon ar.~,r
other property of the Issuer or situated ;•~ithin its corporate ?imits,
but shall constit~zte a lien only on the r=-avenu;~~s derived from the
operation of tha system and said ~;~c,ise t~z;ces.
The 1?_e~a of the hc~l.d._~r of t'~_~ ~o.i s of c.ho iss:z? or"
which this bond is one on the rev~~n~:es of the svstam and the ercisc
taxes is junior, subor~~inate~ and :inferior in r;very respect to thE:~
lien en such revenues ~~nd s~YCise +~<:}.es in f~ivor of the Xssuer's
Outs tariding ~v'ater and Secaer RevenuE~ Fonds, da sec? Navemhez: 1, 1970,
~~ and lti'ater and Sewer Revenue Refur.d.ir,g ~~onds, Series 1972, dated
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~, Dlovember- 1, 197?, hereinaftE'r rE~ferred to as tht "prior lien obl.i-
gations". The Issuer i_n tho Resolution h_is cavenanted and agreod
with the holders of thE~ bonds cF the issue of yatiich this bond is ane
that it caill not hereafter issuE~ any additional obligations payable
from the revenues of the system. o~ t:he excise taxes on a parity frith
the 'prior Lien obligations.
In and by tYlc~ Resolutic;I~, th ~ Issuer teas covenanted arxci
agreed with the halder~> of the bc::c1~; of this .issue that it will
fix, estzsblish, rE~vise frOT, t1lrtE? is ti_.~e vrh.~T:e~~er necess~ ry,
main amain and collect alc~rays such wees, rates v r:>nt~zls and otter
char3es for the use of: the r;rouu~~t, serv c-e~: and f<zcilities of
the systE~m trhich, togE:ther 4;ith t.t.e orcc~~<zds of said ex~.~zse taxes,
W111 c l~•ra.~S prcutl..' c~t~.}7 r=~tTenuE.<:c st_.i:f ~C:~.'~nk: t.o pay, and out of ~:u~~i~
fur,d~ par, as the sa.nE~ shal'_ becc>~;~ .,~:~, t.h:~ ~~~r~.ncipal ~~` and in-
te~~st on the prior lien obligations and the bonds, the necessa _
expenses of operating and maintaining the system and all reserve,
Sinking Fund or ocher paymen~.s required by the Resolution, and that
such rates, rentals, gees and otter charges will not be reduced so
as to be insufficient to provide funds for such purposes, and that
it will .levy and collect said excise taxes at such rates, not
exceeding the maximum rates permitted by law, as shall be necessary
to provide funds which, together ~~;ith the revenues of the system
will be sufficie::t to pay, and out of such funds pay, as the same
shall become due, t~~e principal of and interest on the bonds, the
necessary expenses of operating-and maintaining the system and all
reserve, Sinking Fund or other payments required by the Resolution,
and that. the rates of such excise taxes will not be reduced so as
to be insufficient to provide funds for such purposes.
The bonds of this issue maturing on or before September 1,
1985 are not subject to redemption prior to their respective stated
dates of maturity. Bonds maturing September 1, 1986 and thereafter
shall, at the option of the Issuer, be redeemable in whole or in
part, in inverse numerical and maturity order, on September 1,
1985 or on any interest payment date thereafter at par and accrued
interest, plus the follo~•ring premiums, expressed as percentages of
the par value of the bonds so redeemed, if redeemed in the follow-
. ing years:
50, if redeemed on September 1, 1985 or thereafter,
to and including September 1, 19.88;
4~, if redeemed on September 1, 1989 or thereafter,
to and including September 1, 1992;
30, if redeemed on September 1, 1993 or thereafter,
to and including September 1, 1996;
2~, if redeemed on September I, 1997 or thereafter,
to and including September 1, 2000;
1~, if redeemed on September 1, 2001 or thereafter,
to and including September 1, 2004;
FTithout premium, •if _redeemed September 1, 2005 or
• thereafter, but prior to maturity;
provided, however, that notice of such redemption shall be given
in the manner required by the Resolution.
It is hereby certified and recited that all acts, con-
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d~~.~ons and things required o exist, to happen and to be perfo .
precedent to and in the issuac~ of this bond, exist, have happened
and have been perfo ~~ed, in Ya,.wlar and due form and time as re-
quired by the Laws and Constitution of the State of Florida appli-
cable thereto, and that the issuance of this bond, and of the
issue of bonds of which this bond is one, does not violate any con-
stitutional, statutory or charter limitations or provisions.
This bond and the coupons appertaining thereto are and
have all the qualities and incidents of negotiable instruments
under the law merchant and the Laws of the State of Florida.
This bond may be registered as to both principal and
interest in accordance with the provisions endorsed hereon.
IN jdITNESS t4HERE0F, the City of Clermont, Florida,
has issued this bond and has caused the same to be executed in its
name and on its behalf by its P•iayor and its corporate seal.to be
impressed hereon, attested and countersigned by its Clerk, all as
of
{SEAL)
ATTESTED AND COUNTERSIGi1ED:
Clerk
CITY OF CLEP.i•SONT, FLORIDA
By
T4ayor
FORbS OF CCUPOid
No.
19
On the lst day of September, 19 , unless the bond to
which this coupon i_s attached is callable and shall .have been
previously duly called for prior redemption and payment thereof
duly made or provided for, the City of Clermont, Florida, coi.ll
pay to the bearer at , Florida, from
ttie special funds described in the bond to which this coupon i_s
attached, the amount shown hereon in lawful money of the United
States of America, upon presentation and surrender of this coupon,
being one year's interest then d~~ on its t4ater and Se:aer Revenue
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. „_ _ .,
Bcnd, dated , 19`, .~o.
CITY OF CLER~'~IOi3T, FLORIDA
BY
{SEAL) riayor
ATTESTED AND COUNTERSIGNED:
Clerk
FOR"•f OF VA~,IDATION CERTIFICATE
This bond is one of a series of bonds which were vali-
dated by judgment of the Circuit Court for Lake County, Florida
rendered on , 19
Mayor
PROVISIONS FOR REGISTRATION
This bond may be registered as to both principal and
interest on the books kept by said Clerk, as Bond Registrar, such
registration being noted hereon by the Bond Registrar in tY:e
registration blank below, the coupons being surrendered and the
interest being payable only to the registered holder, remitted by
mail, after which registration no transfer shall be valid unless
made on said books by the registered holder or his legal representa--
~~
tive and similarly noted in the registration blank below, but it
may be discharged from registration by being transferred to bearer,
after which it shall be transferable by delivery, or it may again
be registered as before. Upon reconversion of this bond into a
coupon bond, coupons representing the interest to accrue upon
the bond to date of maturity shall be attached hereto. _
Date of Name and Address of Signature of
Registration Registered Owner Bond Registrar
i ~
-13-
1
A~^TCLL III
a
COVEN%~:5, SRECIAL FUNDS
AND A= ~~~~___i0:; THEREOF
3.41 Bonds Not ^o Be Indebtedness of Issuer, Neither
the bonds nor the coupons attached thereto shall be or constitute
general obligations or indebtedness of the~Issuer as "bonds" within
the meaning of Article VII, Section 12 of the Constitution of
Florida, but shall be payable solely from and secured by a lien
upon and a pledge of said net revenues and excise taxes and a
pledge cif all moneys of the Issuer derived from sources other than
ad valorem taxation and legally available for such purpose, as
herein provided. No owner or holder of any bond or coupon issued
hereunder shall ever have the right to compel the exercise of any
ad valorem taxing power to pay such bond or coupon or the cost of
operating and maintaining the system, or be entitled to pa ~~ent of
such bond or coupon from any funds of the Issuer except from the
net revenues derived from the operation of the system, the e:;cise
taxes, and all moneys of the Issuer derived from sources other
than ad valorem taxation and legally available for such purpose,,
in the manner provided herein.
3.42 Security for Bonds The payment of the debt ser-
vice of all of the bonds issued hereunder shall be secured forthwith
equally and ratably by a pledge of and a lien upon the net revenues
derived from the operation of the system, as now or hereafter
constitutedjand the excise taxes, and a pledge of all moneys of
the Issuer derived from sources other than ad valorem taxation and
legally available for such purpose. The Issuer does hereby irrevoc-
ably pledge such funds to the payment of the principal of and
interest on the bonds issued pursuant to this instrument and to the
payment into the Singing Fund at the times provided of the sums
required to secure the holders of the bonds issued hereunder
the payment_of the principal' o.and interest thereon at the res-
pective-maturities of the bonds and coupons so held by them.
The lien on and pledge of the revenues of the system and
the excise ta:;es in favor of the molders of the bonds is junior,
suborc?inatc anc? inferior in eJOry respect to the Pledge of and
lien on such revenues and e::r_ise taties in favor of the holc'.ers of
--1.4-
thn issuer's said oatstard_~~ p_ior lien obligations.
3,03 Apolicatior: o= ~o^d Proceeds. The Issuer hereby
covenants that it will est~.blis:z with the r ; 'c
Bank, -• ,.Florida, a separate account or accounts
(herein collectively called the "Construction Account") into
which sPiall be deposited the proceeds from the sale of the bonds
herein authorized (except such portion thereof as shall be necessary
to pay interest on the bonds during the construction of the project,
which shall be deposited in the Sinking Fund) and the additional
funds, if any, required to assure payment in full of the cost of
the project. Y~ithdrawals from the Construction Account shall be
made only for such purposes as shall have been previously speci-
fied in the project cost estimates and as shall be approved by
the Issuer's consulting .engineers for the project.
The Issuer's share of any liquidated damages or other
moneys paid by defaulting contractors or their sureties, and all
proceeds of insurance compensating for damages to the project
during the period of construction, shall be deposited in the Con-
struction Account to assure completion of the project.
Moneys in tine Construction Account shall be secured by
the depository ban}: in accordance with U. S. Treasury Department
Circular 176 and in the manner prescribed by the Laws of the State
of Florida relating to the securing of public funds. j~Then the moneys
on deposit in the Construction Account exceed the estimated dis-
bursements on account of the project for the ne::t 40 days, the
Issuer may direct the depository bank to invest such excess funds
in direct obligations of or obligations .the-principal of and inter-
est on cahich are guaranteed by the United States of America, which
shall be subject to rede«ption at any time at face value by the
holder thereof. Th~a earnings from any Such investment shall be
deposited in the Construction~Account,
t•7hF~n the construction of the project has been completed
ar~~~ all construction costs have boon paid in full, all funds
rc'r:~aining in the Construction r_ccount shall he deposited in the
Si.^.~:ing ~'unG hero; ~art~r es t `~~.ist:ed, a:~u the Construction Account
s'i~~t11 :.~e clo~e:i,
-15-
All coneys deposited =.-: acid Construction Account shat
be and constitute a truss ruse c_eated for the purposes stated,
and there is hereby create: a liaz upon such fund in favor. of the
holders of the bonds until th? moneys thereof shall have been
applied in accordance with tris instrument.
3.04 Covenants of the Issuer. So long as any of the
principal of or interest on any of the bonds shall be outstanding
and unpaid, or until there shall have been set apart in the Sinking
Fund herein established, including the Reserve Account therein,
a sum sufficient to pay, when due, the entire principal of the
bonds remaining unpaid, together with interest accrued and to
accrue th4reon, the Issuer covenants with the holders of any and
all of •the bonds issued pursuant'to this instrument as follows;
(A) Annual Budget of Current Expenses. The Issuer
covenants and agrees that on or before the date of delivery of
the bonds to the purchaser thereof, it will adopt a budget of
Current Epenses for the system for the reTaainder of the then
current fiscal year and thereafter, on or before the first day of
each fiscal year during which any of the bonds are outstanding, it
will adopt an Annual Budget of Current Expenses for the ensuing
fiscal year, and will mail a copy of such budget or amendments
thereto to any requesting bondholder, Current E~:penses shall in-
clude all reasonable and necessary costs of operating, repairing,
maintaining and insuring the system, but shall exclude depreciation,
payments into the Sinking Fund and payments into the P.eserve Account.
The Zssuer covenants that the Current Expenses incurred in any year
will not exceed the reasonable and necessary amounts required
therefor, and that it will not expend any amount or incur any
obligations for the operation, maintenance and repair in excess
of the amount provided for Current Expenses in the Annual Budget,
except upon resolution of the City Council that such expenses
are necessary to operate and maintain the system.
(B) Revenue Fund. The Issuer covenants and agrees
that on or before the date of celivery of the bonds to the pur-
ci:aser thereof, it will establish ;•:it?i a depository in the State
of Florida, t•::iich i~ a :, e:~.ber of the Fe3eral lle~~osit Insurance
7_'v -
Co--rporation and which is eligible under t~:~, Laws of the State of
Florida to receive„unicipal f'.:rds, and :^ ;int~t.in so long as any -
of the bonds are outstandir_g, a special f;._;Zd to be known as the
"1975 Clermont ~tiater and Sewer System Rev~ni.e Fund", hereinafter
called the "P.evenue Fund". ^he Revenue Fu;7~a shall be held by the
Issuer separate and apart from all other ~unds and shall be
expended and used only in the manner and Ord=~r specified in
paragraphs (C) , (D) and (E) of this Sectio:i.
The Issuer further covenants and agrees that whenever,
from time to time, at any time deposits fro::; the revenues of the
system shall have been made sufficiently ;or minimum compliance
with the covenants, require:;~ents and provisions of the ordinances
enacted by the Issuer authorizing issuance of the prior lien obli-
gations, and such required deposits shall be made monthly, the
balance of any and all revenues of the system and/or any balance
~'
of moneys or. deposit in the "Revenue Fund" heretofore created
and established for the benefit of the prior lion obligations which
shall be in e~:cess of the requirements for ;rinimum compliance with
such covenants, requirements and provisions of said ordinances shall
forth~~lith; and not less frequently than r•;onthly, be deposited into
said Revenue Fund hereby created. Whenever the said covenants,
requirements and provisions of such ordinances shall no longer re-
~ quire deposits of revenues of the system for the debt service of
the prior Lien obligations, the Issuer shall deposit into the
Revenue Fund, promptly as received, all cash income received from
the ownership and operation of the--system.
(C) Bond and Interest Sinking Fund. The Issuer cove-
nants and agrees to establish with a depository in the State of
Florida, which is a member of the Federal Deposit Insurance Corp-
oration, and which is eligible under the ~~~~~ of the State of
Florida to receive municipal funds a special fund or funds, collec-
tively called "1°75 Clermont ~•?a ter and Se~,;`~, cvstem Bond and Interest
Sinfiine~ Fund", hereinafter called the "Si;~~: ;;1:~ fund", to be used
eticlusively for the purposes hereinafter °~- :~tionod. After delivery
of the bonds to the purchaser thereof, the ':~.;uer shall transfer
on or before the 15th day of each month fr,,;~; t-.he Revenue Fund znct
--17-
deposit to the credit of the Sin.'•cing Fund the following amounts.
(1} ri s~.Lm equal to 1/12 of the amount of one year's
interest on all the bonds t;-~en outstanding, together with the
amount of any deficiency in prior deposits for interest;~and
(2) Becinning on September 15, 1977, a sum equal to
1/12 of the principal of the bonds maturing on the next succeed-
ing anniversary date, together with the amount of any deficiency
in prior deposits for principal.
(3} Nfter fulfillment of the requirements of para-
graphs (C)(1) and (2}, the Issuer shall transfer on or before the
15th day of each month from the Revenue Fund and deposit to the
credit of a special account in the Sinking Fund, herein called
the "Reserve Account", the sum of Seventy-seven Dollars ($77.00)
until such tint as the funds and investments therein shall equal
Nine Thousand '~r:o Hundred Dollars ($9,200), and monthly there-
after such amount as may be necessary to maintain in she Reserve
Accoc:nt the sun of Nine Thousand Two Hundred Dollars ($9,200)
but not exceeding Seventy-seven Dollars ($77.00) monthly. yioneys
in the Reserve Account shall be used only for (1) paying the cost
of repairing or replacing any•damage to the system which shall be
caused by an unforeseen catastrophe, (2) constructing improve-
„`
ments or extensions to the system which shall increase its net
revenues and which shall be approved by said consulting engineers,
if the Issuer shall not then be in default under any of the pro-
visions of this instrument, and (3) paying the principal of and
.interest on the bonds in the event that the moneys in the Sinking
Fund shall ever be insufficient to meet such payments.
(D) Operation of Maintenance Fund. t9Iienever provision
for the payment of the reasonable current expenses of the operating,
maintaining and repairing of the system pursuant to the provisions
of said ordinances authorizing issuance of the prior lien obliga-
tioiis shall expire or cease by reason of the terms of such ordinances,
or for any other reason, the Issuer covenants and agrees to
establish with a depository in the State of Florida, which is a
:~^~::ber of the Federal Deposit Insurance Corporation, anti ,•r!~ich is
-13-
eligible under the Laws of tr.~ State of Florida to receive munici-
pal funds, a Spacial fund to be known as the "Clermont eater
and Sewer System Operation and t~±aintenance Fund", herein called
the "Operation. and ?~:aintenanc? Fund;" which shall be used exclu-
sively for the purpose of receiving funds to be transferred monthly
by the Issuer from the Revenue Fund, and for paying, as they
accrue, the Current Expenses of the system pursuant to the Annual
Budget. After delivery of the bonds to the purchaser thereof,
and after havir_g made the deposits to the Sinking Fund as pro-
vided in paragraph (C} above, the Issuer shall transfer on or
before the 15th day of each month from the Revenue Fund and
deposit to the credit of the Operating and Maintenance Fund a sum
sufficient to pay the Current Expenses of the system for the
current month, all in accordance with the Annual Budget. Any
balance remaining in the Operation and Maintenance Fund at the
end of the fiscal year and not required to pay costs incurred
during said fiscal year shall be deposited promptly into the
Revenue Fund.
{E) Excise Taxes Fund. The Issuer covenants and agrees
to establish with a depository in the State of Florida, ~ti~hich~is
a member of the Federal Deposit Insurance Corporation, and which
~~` is eligible under the Laws of the Stte of Florida to receive
municipal funds, a special fund to be known as the "1975 Clermont
Excise Taxes Fund", hereinafter called the "Excise Taxes Fund".-
The Issuer further covenants and agrees that whenever,
from time to time, at any time deposits from the excise taxes
shall have been made sufficiently for minimum compliance with the
covenants, requirements and provisions of the ordinances enacted
by the Issuer authorizing issuance of the prior lien obligations,
and such required deposits shall be made monthly, the balance of
moneys on deposit in the "1972 Excise Taxes Fund" heretofore
created and established for the benefit of the prior lien obliga-
tions dated Novenber 1, 1972, which shall be in eYCess of the
requirements for mir.imu::1 compliance with such covenants, require-
r~er.ts and provisions of said ordinances shall forth~,rith, and not
less r.requently than mon;hl_v, be deposited into sUid 1975 Excise
-19-
S
Tax's Fund hereby created. ,whenever the said covenants. require-
meats and provisicns of suc^ orainances shall no longer requiro
deposits of the excise taties Lor the debt service of the prior
lien obligations, the issuer shall deposit into the 1975 Excise
Taxes Fund, promptly as received, all of the excise taxes as soon
as the same are collected by the Issuer.
Whenever by reason of the insufficiency of moneys on
deposit in the Revenue Fund the Issuer is not able to make promptly
the current monthly payments required to be made pursuant to the
provisions of paragraphs (C) and (D} above, there shall be paid
into the Revenue Fund from the moneys on deposit in the 1975
Excise Taxes rued whatever sums are necessary to cure such ex-
fisting deficit. After the 15th day of each month, i.f -all of the
above-required current payments have been made from the Revenue
Fund, and from the 1975 Excise Taxes Fund to the extent neces-
sary, the balance of any moneys on deposit in the 1975 Excise
Ta::es r^und may ba witndra~,m and used by the Issuer for any lawful
municipal purpose.
(F) Deficiency or Excess Funds. Whenever by reason~of
the insufficiency of moneys on deposit in the Revenue-Fund the
Issuer is not able to make promptly the current monthly payments
~' required to be made pursuant to the provisions of paragraph (C)
` above, the Issuer covenants and agrees that it will pay into the
Revenue Fund from any moneys of the Issuer derived from sources
other than ad valorem taxation and legally available for such
purpose whatever sums are necessary to cure such existing defi-
cit. Subject to the provisions for the disposition of revenues
in paragraphs (C) and (D), which are cumulative, the Issuer shall,
r
on or before the 15th day of,~each ~e~h; transfer to the Reserve
0
Account in the Sinking Fund the balance of moneys remaining in
the Revenue Fund for the prompt use by the Issuer to redeem bonds
in inverse nu~:,erical and maturity order or to acquire outstanding
bonds for retirement at not-e~:ceedinq the price of par and accrued
interest, to the extent that funds and investments in the Reserve
~:ccount exceed the ar^ount of Fine Thousand Toro IIundred Dollars
{$9,?nq}, or the Issuer may use such balance of moneys rer;raining
_?p_
in the Revenue Fund for the payment of debt service on subordin e
obligations.
(G) Tr}.;st Funds, "'ze funds and accounts created and
established by this instrument shall constitute trust funds for
the purposes provided herein for such funds. All of such funds,'
except as hereinafter provided, shall be continuously secured in
the same manner as municipal deposits of funds are required to be
secured by the Laws of the State of Florida. Moneys on deposit to
the credit of the Reserve Account shall be invested by the deposi-
Cory bank, upon request by the Issuer, in direct obligations of,
or obligations the principal of and interest on which are guaran-
teed by the United States of America and cehich shall be subject to.
redemption at face value at any 'time by the holder thereof at the
option of such holder; and the moneys on deposit to the credit of
the Sinking Fund may be so invested in such obligations which
shall mature not later than fifteen (15) days prior to the date
on ;a;:ich such r::o::eys shall be needed to pay the principal of and
interest on the bonds in the manner herein provided, but moneys
on deposit to the credit of the Revenue Fund, the 1975 Excise
Taxes Fund and the Operation and Maintenance Fund shall not be
invested at any time. The securities so purchased as an invest-
ment of funds shall be deemed at all times to be a part of the
account from which the said investment was withdrawn, and the
interest accruing thereon and any profit realized therefrom
shall be credited to such account and any loss resulting from
such investment shall likewise be charged to said account.
(x) Rates and Charges. The Issuer covenants and
agrees. to maintain and collect, so long as any of tYie bonds are
outstanding, s~zch schedule of rates and charges for the services
and facilities of the system ~•rhich, together wit'n the excise taxes,
will produce revenues which shall be sufficient to provide for
current debt service and reserve requirements for said outstand-
inn prior lien obligations and for the bonds herein authorized
and pay the reasonable e}.penses of operation .and maintenance of
t'~e system; and th-a Issuer covenants and ac~rees~ that so long as
any of the bones are outstanc~inc~ anJ. unf~aicl, at the same tine and
-21-
in like manner that t:~e Issuar p=epares its Annual ~3udget of the
Current Expenses, the Issuer s^~11 annually prepare an estimatz
of gross revenues to be c~r~ved from the operation of the system
for the ensuing fiscal year, and to the extent that said gross
revenues, together with the excise taxes, are insufficient to pay
debt service requirements during such ensuing year on ali out-
standing bonds payable from the revenues of the system, build up
and maintain the required reserves for all such outstanding bonds
and pay Current Expenses, the Issuer shall revise the fees and
rates charged for the_use of the services and facilities of thz
system sufficiently to provide the funds required.
(I) Levy of Excise Tares. .The' issuer covenants and
agrees that it will not repeal the ordinances now in effect levying
the excise taxes and will not amend or modify said ordinances in
any manner so as Lo impair or adversely affect the power an3 obli-
gation of the Issuer to levy and collect such excise taxes or im-
pair or adversely affect in any manner the pledge of such excise
taxes made herein or the rights of the holders of the bonds. The
Issuer shall be unconditionally.and irrevocably obligated, so long
as any of the bonds or the interest thereon are outstanding and
unpaid, to levy and collect such excise taxes at such rates, not
exceeding the maximum rates permitted by law, as shall be necessary
to provide funds which, together with the gross revenues of the
system, shall be sufficient to pay, as the same shall become due,
the principal of and interest on the bonds, the principal of and
interest on the prior lien obligations, the Current Expenses of
operating and maintaining the system and. the other payments pro-
vided for herein. This provision shall not be~construed to
prevent reasonable revisions of the rates of such excise taxes as
long as the proceeds of such excise taxes to b~ collected by the
Issuer in each year thereafter, together with the gross revenues
of_ the system, ~~ill be sufficient to nay the principal of and
interest on the bonds and the prior lien obligations as the same
shall become due and pay the cu_Yart expenses of operating and main-
tai Wing the syste::~ ar_d to ma':o the other payments herein required
in such fear.
(,7) I:->r;n~ance of n:.'a'r t~?>7_t<f;~tic~t~s.
_~ •~_
• •
(1) ^he Issuer cov~r.ants and agrees that in the event
the cost of construction or co^p?otior. of the project shall exceed
the dollar amo~~nt of bon~.s h:?rein authorized, it-shall deposit
into the Construeticr. Acco~.2t the amount of such excess out of
funds available to it for such purpose, and the Issuer may provide
such excess, and only such excess, through the issuance of parity
bonds conforming to the requirements of paragraph (3) of this sub-
section; but e~:ceot to complete the project, it will not issue. any
other obligations payable from or secured by the revenues of the
system and the proceeds of the excise taxes or any other security
pledged to secure payment of the bonds herein authorized, unless
the conditions hereinafter set forth shall be met, or unless the
lien of such obligations is junior and subordinate in all respects
to the lien of these bonds. The Issuer covenants and agrees that
it will not issue any additional obligations payable from the
revenues of the system or the proceeds of the excise taxes on a •
Larity frith ti:e outstanding prior lien obligations.
(2) The Issuer shall have the right to add new water
or seG•aer facilities and related auxiliary facilities, by the
issuance of one or more additional series of bonds to be secured
by a parity lien on and ratably payable from the net revenues
o~ the system and any other security pledged to these bonds,
provided in each instance that:
(a) The facility or facilities to be built from the
proceeds of the additional parity bonds is or are Wade a part of
the system and its or their revenues are pledged as additional
security for the additional parity bonds and the outstanding ;ponds.
{b) The Issuer is in compliance with all covenants and
undertakings in connection with all of its bonds then outstanding
and payable from the revenues of the system or any part thereof
and has not been in default as to any payments required to be
made under this instrument fora period of at least the nett pre-
ceding 24 months,. or if at. such time the bonds shall not have been
outstanding for 2: months then for the period that the bonds shall
ha~•e been outstanding.
(c) Tine annual net revenues (phis the proceeds of the
-?_ 3-
~ ~. i
e~:cise taxes, if such excise to;{as shall be pledged as security
for the outsta:_uin bonds ar_d th' additional parity bonds) for
the fiscal year nett preceding t:~e issuance of additional parity
bonds are certified by an independent certified public accountant
not regularly e;?ploved by the Issuer, to have been equal to at
Least one and twenty-hundredths (1,20) times the average annual
requirements for principal and interest on all the bonds then
outstanding and payable from such pledged revenues.
(d) The estimated average annual net revenues of the
facility or facilities to be constructed and acquired with the
proceeds of such additional bonds (and any other funds pledged
and set aside for such purpose), when added to the estimated fu-
tune average annual net revenues of the then existing system (plus
the proceeds of the excise taxes, if such excise taxes shall be
pledged as security for the outstanding bonds and the additional
parity bonds) shall be at least one and twenty-hundredths (1.20)
timss the average annual dabt service requirem`nts for principa 1 and
interest on all outstanding bonds payable from the revenues of the
system and on the additional bonds proposed to be issued. Esti-
mates of future revenues and operating 'expenses shall be fur-
nished by recognized independent consulting engineers and approved
by the City Council of the Issuer and by the P~Iayor thereof, and
~`
shall be forecast over a period of not exceeding ten years from
the date of the additional bonds proposed to be issued. Pro-
vided, hocaever, the conditions provided by this- paragraph and by
the next preceding paragraph (c) may be waived or modir"ied by the
written consent of tine holders of seventy-five per centum (750)
of the bonds then outstanding.
(3) The Issuer hereby covenants and agrees that in the
event additional series of parity bonds are issued, it will provide
that said parity bonds shall mature according to a schedule which
most ciose].y approximates equal annual installments of co~^bined
principal and interest payi;lents for such parity bo~ids and all oth-~r
bonds payable from the revenues of the systen; it will adjust the
requ? red deposits into the maxin:u::1 amount to be maintained in the
Si,>:ing Fund, incluuinr, trio t eserv4 F~ccount therein, on the same
-2g_
r
~-
ba~is as hereinabove prescribd, to reflect the average annual debt
service on the additional bonds; and it will make such additional
bonds payable as to principal on September 1 of each year in which
principal falls due and the coupons'attached thereto payable on
September 1 of each year. If in any subsequently issued series of
bonds secured by a parity lien on the revenues of the system it
is provided that excess revenues shall be used to redeem bonds in
advance of scheduled maturity, or if the Issuer at its option under-
takes to redeer outstanding bonds in advance of scheduled maturity,
the Issuer covenants that calls of bonds will be .applied to each
series of bonds on an-equal-pro rata basis, proportionate to the
principal amour_t of bonds of each series outstanding at the time
of such call, to the extent that this may be accomplished in
accordance t•~ith the call provisions of .the respective bond series,
but the Issuer shall have the right to call any or all outstand-
ing bonds which may be called at par prior to calling any bonds
that are callable at a premium.
(K) Disposal of Facilities. The Issuer covenants and
agrees that, so long as any of the bonds are outstanding, it twill
maintain its corporate identity and existance and twill not sell
or otherwise dispose of any of the system facilities or any part
thereof, and, e:~cept as provided for above,_it will not create
ti,
or permit to be created any charge or lien on~the revenues thereof
ranking equal or prior to the charge or lien of these bonds. Not-
withstanding the foregoing, the Issuer may at any time permanently
abaxidon the use of, or sell at fair market value, any of its system
facilities, provided that:
(a) It is in compliance with all covenants and under-
takings in connection with all of its bonds then outstanding and
payable from the revenues of the system, and the debt service
reserve for such bonds has been fully established;
(b) It will, in the event of sale; apply the proceeds
to either (1) redemption of outstanding bonds in accordance with
the provisions governing repayment of bonds in advance of maturity,
or {2) replace:~:ent of the facility so disposed of by anQ~her facili--
_2~_
ty the revenuers of which shall be incorporated into the system as
hereinbefore oro-:i3ed;
(c) It certifies, prior to any abandonment of use,
that the facility to b? aba^~do:~ed is no longer economically feasi-
ble of producing net revenues; and
(d) It certifies that the estimated net revenues of
the remaining syst~n facilities for the next succeeding fiscal
year, plus thz est;1-~ated net revenues of the facility, if any, to
be added to the system, satisfy the earnings test hereinbefore
provided in this section governing issuance of additional
parity bonds.
(T) Insurance on System. TVhile any of the bonds shall
remain outstanding, the Issuer shall carry at least the following
insurance coverage:
(1) sire and extended coverage insurance on the insur--
able portions of the system, in amounts sufficient to provide for
=:ot less than fu? 1 recovory i,~henever a loss from perils insured
against does not exceed eighty per centu.Tn (800} of the full insura-
ble value of the damaged facility.
In the event of any damage to or destruction of any
facility or facilities of the system, the Issuer shall deposit
the insurance proceeds in the Reserve Account and pro::lptly arrange
~.
fcr the application thereof to the repair or reconstruction of the
damaged or destroyed portion thereof.
(2) Public liability insurance relating to the operation
of the system, with limits of not less than $100,000 for one person
and $300,000 for more zzan one person involved in one accident, to
protect the Issuer from claims for bodily injury and/or death and
not less than $10,000 for claims for damage to property of others
which may arise from the Issuer's operation of the system.
(3) If the Issuer o~ti~ns or operates a vehicle iri the
operation of the system, vehicular public liability insurance with
limits of not less than $10.0,000 for orie person and $300,000 for
::ZOre t,~an one person involved in oneaccident to protect the
IsJt:er from clai:lS for bodily i:~jury and death, and not less than
$10,+~00 against claiMS for dar;:a7e to ~~ra~ert~~ of otEicrs ~~hich may
-2G-
• r
arse from the Issuer's operation of vehicles.
(4) All such 1nSi:=Gnc~ shall be carried for the benefit
of the holders of the bonds. ,11 r•~oneys received for losses
under any of such ins•arance, except public liability, are hereby
pledged by the ?'ssuer as security for the bonds .herein authorized,
until and unless such proceeds are used to remedy the loss or damage
for which such proceeds are received, either by repairing the pro-
perty damaged or replacing the property destroyed within ninety
(90) days from the receipt of such proceeds.
(M) TM:aintenance of System. The Issuer will complete the
construction of the project in an economical and efficient manner
with all practicable dispatch, and thereafter will maintain the
system in good condition and continuously operate the same in an
efficient manner and at a reasonable cost.
(N) No Free Services. The Issuer will not render~or
cause to be rendered any free services of any nature by its system,
r.or will any preferer_tial rates be established for users of the
same clasp; and if the Issuer shall avail itself of the facilities
or services provided by the system, or any part thereof, then the
same rates, fees or charges applicable to other customers receiv-
ing like service under similar circumstances shall be charged
to the Issuer. Such charges shall be paid as they accrue, and the
`= Issuer shall transfer from its general. funds sufficient sums to pay
such charges. The revenues so received shall be deemed to be
revenues derived from the operation of the system, and shall be
deposited and accounted for in the same manner as other revenues
derived from such operation of the system.
(O) Failure of User to PaZ~ for Services. Upon failure
of any user to pay for services rendered within sixty (60) days,
the Issuer shall shut off the connection of such user and sh111 not
furnish him or permit him to receive from the system further ser-
vice until all obligations o~•;ed by him to the Issuer on account
of services shall have been paid in full. This covenant shall not,
ho~•;ever, prevent the Issuer from causing any system connection to
be shut off sooner.
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(P) ~n~orcemer.t o= Collections. The Issuer will di:li-
gently enforce and collect the rates, fees and other charges for
the services and facilities of tze systei:l; and will take all steps,
actions and proceedings for tine enforcement and collection of
such rates, charges and fees as shall becone delinquent to the
full extent per;~itted or authorized by law; and will maintain accu-
rate records with respect thereof. All such fees, rates, charges
and revenues herein pledged shall, as collected, be held in trust
to be applied as provided in this instrument and not otherwise.
(Q) Sufficiency of Rates. The Issuer covenants and
agrees trat it will fix, establish, revise from time to time whenever
necessary and maintain always such fees,.rates, rentals and other
charges 'for the use of the product, services and facilities of the
system which, together with the excise taxes, ~•~ill always produce
cash revenues suf~icient to pay, and out of such funds pay, as the
same shall beco^e due, the principal of and interest on the prior
lien obligations and the bonds, the necessary expenses of opera-
ting and maintaining the system and all reserve, Sinking Fund or
other payments required by this instrument, and that such rates,
fees, rentals or other charges will not•be reduced so as to be
insufficient to provide funds for such purposes.
`~ (R) Co^;nliance with La~,~=s and Regulations. The Issuer
covenants and agrees to perform and comply .with, in every respect,
the Loan Agreements which it might have with the Government or
with any other governmental agency and all applicable r^ederal and
State Laws and regulations.
{S) P.emedies. Any holder of the bonds or any coupons
appertaining thereto issued under the provisions of this instrument,
or any trustee acting for the holders of such bonds and coupons,
may either at law or in equity, by suit,-action, manda::lus or
other proceedings in any court of co*~petent jurisdiction, protect
and enforce any and all rights, including the right to the appoint-
ment of a receiver, existing under the T,acas of the Stag of Florida,
or granted and contained in this instru:r.ent, and may enforce and
co-^^el t}:e perfor:-^ance of all duties requircu by this instrument
or by any aL~plicablc State or Federal statute i_a ba pcrformc~d U,
the I~~~u-~r or by any o~ficer thereof, inclu~I_inct the levy an;: collc;:-
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tion of the excise taxes.
•
clothing : ere i n, ho•,;a y =r, shall be construed to grant to
any holdex• of such bonus o~~ co~.ons any lien on any real property
of the Issuer.
(T) Records and Audits. The Issuer shall keep books
and records of the revenues of the system and the proceeds of the
excise taxes, w'r.ich such boo:~cs and records shall be kept separate
and apart from all other books, records and accounts of the Issuer,
and any Holder of a bond or bonds or the coupons applicable there-
to issued pursuant to this instrument shall have the right to, at
all reasonable tines, inspect all records, accounts and data of
the Issuer relating thereto.
So long as any of the bonds shall be outstanding, the
Issuer will f~~rnish on or before ninety (90) days after the close
of each fiscal year, to any bondholder who shall request the same
in writing, copies of an annual audit report prepared by an indepen-
dent certified public accountant or an auditing official of the
State of Florida, covering for the preceding fiscal year, in rea-
sonable detail, the financial condition and record of operation
of the system and any other facilities the revenues of which are
pledc;ed to the pay~tent of the bongs and the collection. of the
excise ta::es.
(U) Connection with System. The Issuer will, to the
full extent permitted by law, require all lands; buildings, res i-
dences and structures within its corporate limits tohich can use the
facilities and services of the system to connect therewith and use
the facilities and services thereof, and to cease the. use of ail
other facilities. The Issuer mill not grant a franchise for the
operation. of any comr~eting water or sower system until all bands
issued hereunder, together with interest thereon, shall have been
paid in full.
(V) Ficlclity Sond. The Issuer twill require each employee
who r:;ay blue possession of the rev::~.:os of the system or the proce~ac'.s
of the excise t:l:;es to bo covere ~ ::~•.~ a fid~li.ty bond written by a
rE`S~a0il~ilZ)14 lit:.'^:_11.~ C0.~1?a?1y 1i uil a~:OUnt fully c'zC~Oijllilte tO pro'
t~.Ct the Issuer fro;:t loss.
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(W) Government AanYoval of Extensions and Financing.
Anything herein to tI:° contrar-7~ notwithstanding, while the Govern-.
s:?nt is the holdo_ of any of the boners, the Issuer will not borro~~-
any money from any source or enter into any contract or agreement
or incur any other liability in connection with making extensions
or improvements-other than normal maintenance of the system,~or
cake any extensions or enlargements of the system, or permit othe:;,_
to do so, witho~.:t obtainir_g the prior written consent of the
Government.
(X) ??eimbursement of Advances and Interest Thereon.
While the Govern;:ient shall be the holder of any of the bonds, the
Government shall have the right to make advances for the payment
of insurance prer.~iurs and/or other advances which, in the opinion
of the~Government, may be required to protect the Government's
security interest. In the event of any such advances, the Issue?
covenants and agrees to repay the same, together with interest
thereon at the same rate per annum as specified in the bonds, upo_~
demand made at any time after any ~;uch expenditure by the Govern-
ment. Any such amount due the Government shall take priority ove-;
any other payr~ents from the Reserve Account.
(Y) release of r:ccise Taves.
At such time as the IssT~;~-
may be able to obtain and file in the minutes of its City Council_
,`
a certificate of a certified public accountant not regularly
employed by the Issuer stating that for the immediately preceding
fiscal year the net revenues derived from the operation of the
system equaled at least one hundred forty percentum (1~0~s) of tze-
combined maximum principal and interest maturing in any one ensu-
ing fiscal year on all outstanding obligations payable from the
revenues of the system, then upon a declaration by resolution of
the City Council the lien hereby impressed upon the etcise
taxes as security for payment of the bonds and the interest ther~4 --___
shall be permanently released, and thereafter the payment of the
bonds a.nci the interest thereon shall be solely secured by a lien
upon and pledge of the revenues to be derived from the operation
of th~~ system; provi~?ed, however, the e::cise ta::es shall not be
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-. ~ -e~r++a .a
released unless alI payments rea•uired by this instrument to have
begin made to the several acco::r.ts ?nd Funds herein specified shall
have been made in full, and the Reserve Account shall have on
deposit therein at least the s~-~ of Nine Thousand Two Hundred
Dollars ($9,200),
(Z) Expiration of Existing Franchises. The Issuer
covenants and acrezs that if at the expiration of the said franchise
agreements with ~'iorida Power & Light Company and Lake Apopka
Natural Gas District it shall enter into new franchise agreements
with said companies or any other electric power or natural gas
supplier, then the franchise taxes resulting from such agreements
shall be depositea into the Excise Taxes Fund in the same manner
as it is herein provided for the ~payrent therein of the existing
franchise taxes; and the Issuer does further covenant and
agree that if at ar_y time the Issuer should undertake to own and
operate a municipal electric or natural gas system, it shall
deposit into t:~e EYcise Taxes Fund six percer_tun: (6°) of tha gross
revenues derived by the Issuer from the operation of such munici-
pal electric or natural gas system.
ARTICLE IV
i;ISCELL?1`1EOUS P:OVISIO,~S
4.01 i~~odification or ?~^endment. No':~,aterial modifica-
tion or amendment of this instrument or of any instrument amendatory
hereof of supplemental hereto, may be made without the consent
in writing of the holders of two-thirds or more in principal amount
of the bands then outstanding; provided, however, that no modifi-
cation or amendment shall permit a change in the maturity of such
bonds or a reduction. in the rate of interest thereon, or in the
amount of the principal obligation, or affect the unconditional
pro:~ise of the Issuer to charge and collect such. rates, fees and
charges for the use of the product, services and facilities of the
system and to levy and collect the excise taxes and apply the
Sc-1T'ilC c~S hE'rfr'ln prOV1C:E'.d, Or iC':~UC~? t(1 C' number Of SUCIl bOn:~S tr2G~
written consent of the holders of ~•inic:~ are required by this
JCCtI.'?n fo~r7 suc'_~ TMo~? if i cations or amendments, without thn consort
Of t~:l~ i~.7111 L1.J ~l G11 SUCK t~O1r`.ls~
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4.02 Creation of - ^e•-or Liens. The Issuer covenants
that except as tierein prov_.~_= _` Krill not issue any other bonds,
certificates ox abligatio^s s= any kind or nature or create or
cause or pernit to bz create;: any debt, lien, pledge, assignment
or encumbrance or charge payable from or enjoying a lien upon
ti:e revenues or the system or the excise taxes ranking prior and
superior to the lien created by this instrument for the benefit of
the bor_ds herein authorized.
4.03 Severability of Invalid Provisions. If any one
or more of the covenants, agreements or provisions of this instru-
ment should be held contrary to any express provision of la~,r
or contrary to the policy of express law, though not expressly.
prohibited, or against public policy, or shall 'for any reason
whatsoever be held invalid, then such covenants, agreements or
provisions shall be null and void and shall be deemed separate
from the remaining covenants, agreements or provisions of this
instrument and of the bonds iss~.zed hereunder.
4.04 ~Talidation Authorized The Issuer's Attorney is
hereby authorized and directed to institute appropriate proceedings
in the Circuit Court for Lake County, Florida, for the validation
of said bonds and the proper officers of the Issuer are :hereby
authorized to verify on behalf of the Issuer any pleadings in such
proceedings.
4.05 Sale of Bonds.
The bonds are hereby sold and
awarded to the Government.
4.06_ Conflicts Repealed. All resolutions or part of
resolutions in conflict here~oith are hereby repealed.
4.07 Effective Date. This instrument shall take effect
im~:ecliately upon its passage.
DONE AND RESOVED BY THE CITY COUNCIL OF THE CITY OF CLERMONT,
LAKE COUNTY, FLORIDA this 24th day of September, A.D. 1974.
CITY 0 LE MONT
BY:
, .,
ATTEST:
Do ores W. Carro , ,ty er
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