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R-2017-28 CITY OF CLERMONT RESOLUTION NO. 2017-28 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CLERMONT, LAKE COUNTY, FLORIDA AUTHORIZING THE ISSUANCE OF NOT TO EXCEED $30,000,000 MASTER PLAN CAPITAL PROJECTS REVENUE NOTE, SERIES 2017 TO FINANCE ALL OR A PART OF THE COSTS OF CERTAIN MASTER PLAN CAPITAL PROJECTS DESCRIBED HEREIN AND TO PAY RELATED CLOSING COSTS; PROVIDING THAT SUCH NOTE SHALL BE A LIMITED OBLIGATION OF THE CITY PAYABLE SOLELY FROM NON-AD VALOREM REVENUES BUDGETED AND APPROPRIATED AS PROVIDED HEREIN; PROVIDING FOR THE RIGHTS, SECURITIES AND REMEDIES FOR THE OWNER OF SUCH NOTE; MAKING CERTAIN COVENANTS AND AGREEMENTS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED by the City Council of the City of Clermont, Lake County, Florida, as follows: Section 1 -Authority for this Resolution. This Resolution is adopted pursuant to the Constitution of the State of Florida, Chapter 166, Part II, Florida Statutes, the municipal charter of the City of Clermont, Florida and other applicable provisions of law (collectively, the "Act"). Section 2 -Definitions. All capitalized undefined terms shall have the same meanings as set forth in this Resolution, as hereinafter defined. In addition, the following terms, unless the context otherwise requires, shall have the meanings specified in this section. Words importing the singular number shall include the plural number in each case and vice versa. "Authorized City Officer" for the performance on the behalf of the City of any act of the City or the execution of any instrument on behalf of the City shall mean any person authorized by resolution or certificate of the City to perform such act or sign such document. "Business Day" shall mean any day except any (i) Saturday or Sunday, (ii) day on which the Principal Office of the Original Purchaser is lawfully closed (solely during such time as the Original Purchaser owns the 2017 Note or any interest therein) or(iii) day on which commercial banks are required or authorized to be closed in the State. "City Attorney"shall mean the City Attorney or any Assistant City Attorney of the City. 1 "City Clerk"shall mean the City Clerk or any assistant or deputy City Clerk of the City. "City Council"shall mean the City Council of the City. "Code"shall mean the Internal Revenue Code of 1986,as amended,and any Treasury Regulations, whether temporary, proposed or final, promulgated thereunder or applicable thereto. "Costs"when used in connection with the Project, shall mean costs of the Project paid by the City on or after February 24, 2017, which are permissible uses of the Pledged Revenues consisting of (i)the City's costs of physical construction,(ii)costs of acquisition by or for the City of the Project, (iii) costs of land and interest therein and the costs of the City incidental to such acquisition, (iv) the cost of any indemnity and surety bonds and premiums for insurance during construction, (v) all interest due to be paid on the 2017 Note during the construction period of the Project and for a reasonable period thereafter, (vi) engineering, legal and other consultant fees and expenses, (vii) costs and expenses incidental to the issuance of the 2017 Note, (viii) costs of machinery, furnishings or equipment required by the City for the commencement of operation of the Project and(ix)any other costs properly attributable to the issuance of the 2017 Note and such construction or acquisition, as determined by generally accepted accounting principles and may include reimbursement to the City of any such items of Costs heretofore paid by the City on or after February 24, 2017. "Debt Service Fund"shall mean the Debt Service Fund established with respect to the 2017 Note pursuant to Section 10 hereof. "Finance Director"shall mean the Finance Director of the City, or his designee. "Fiscal Year"shall mean the period commencing on October 1 of each year and continuing through the next succeeding September 30, or such other period as may be prescribed by law. "City"shall mean the City of Clermont, Florida, a municipal corporation of the State of Florida. "2017 Maturity Date"shall mean December 1, 2032. "Mayor" shall mean the Mayor of the City, or his designee. The Mayor is authorized, but is not bound, to designate the City Administrator and/or the Finance Director to execute certificates, agreements and all other documents in connection with the issuance of the 2017 Note. "Non-Ad Valorem Revenues" shall mean all legally available funds of the City derived from any source whatsoever other than ad valorem taxation on real or personal property. "2017 Note" shall mean the City's Master Plan Capital Projects Revenue Note, Series 2017 authorized by Section 4 hereof. 2 "Note Counsel" shall mean Foley & Lardner LLP, or other nationally recognized bond counsel firm. "Original Purchaser"shall mean Pinnacle Public Finance, Inc., and its successors and assigns. "Owner"or."Owners" shall mean the Person or Persons in whose name or names the 2017 Note shall,be registered on the books of the City kept for that purpose inaccordance with provisions of this Resolution. "Permitted Lender"shallmean any affiliate of the Original Purchaser or any bank, trust company, savings institution, insurance company or other financial institution and their affiliates. "Person"shall mean natural persons, firms,trusts, estates, associations, corporations,partnerships and public bodies. "Pledged Revenues" shall mean the Non-Ad Valorem Revenues budgeted, appropriated and deposited in the Debt Service Fund,including any earnings thereon, and any proceeds of the 2017 Note on deposit in the Project Fund as provided herein. "Principal Office" shall mean with respect to the Original Purchaser, the office located at 8377 East Hartford Drive, Suite 115, Scottsdale, Arizona 85255, or such other office as the Original Purchaser may designate to the City in writing. "Project"shall mean the Master.Plan capital projects described in Exhibit A hereto. "Project Fund" shall mean Project Fund established with respect to the 2017 Note pursuant to Section 11 hereof. "Resolution" shall mean this Resolution, pursuant to which the 2017 Note is authorized to be issued, including any supplemental resolution(s). "State"shall mean the State of Florida. Section 3 - Findings. (A) For the benefit,of its citizens, the City finds, determines and declares that it is beneficial for the continued preservation of the welfare and convenience of the City and its citizens to finance,the costs of the Project. (B) Debt service on the 2017 Note will be secured by a covenant to budget,appropriate and deposit Non-Ad Valorem Revenues as provided herein. The Pledged Revenues will be sufficient to pay the principal and interest on the 2017 Note herein authorized, as the same become due,-and to make all deposits required by this Resolution. 3 (C) The City shall never be required d to levy ad valorem taxes or use the proceeds thereof to pay debt service on the 2017 Note or to make any other payments to be made hereunder or to maintain or continue any of the activities of the City which generate user service charges,regulatory fees or any Non-Ad Valorem Revenues. The 2017 Note shall not constitute a lien on any property owned by or situated within the city limits of the City other than-the Pledged Revenues. (D) It is estimated that the Non-Ad Valorem Revenues will be available after satisfying funding requirements for obligations having an express lien on or pledge thereof and after satisfying funding requirements for essential governmental services of the City, in amounts sufficient to provide for the payment of the principal of and interest on the 2017 Note and all other payment obligations hereunder. (E) The City, after soliciting proposals in response to a request for loan proposals distributed by the City on April 21, 2017 for financing the costs of the Project, and receiving multiple responses complying with the structure described in such request,has selected the Original Purchaser to purchase the 2017 Note. Section 4 Authorization of the 2017 Note and Project. Subject and pursuant to the provisions of this Resolution, an obligation of the City to be known as the"City of Clermont, Florida MasterPlan Capital Projects Revenue Note, Series 2017"is hereby authorized to beissued under and secured by this Resolution in the principal amount of not to exceed$30,000,000 for the purpose of financing all or a part of the costs of the Project,and paying the"costs of issuing the 2017 Note. The use of the proceeds of the 2017 Note as heretofore described is authorized. The Project is also hereby-authorized. Because of the characteristics of the 2017 Note, prevailing market conditions, and additional savings to be realizedfrom an expeditious sale of the 2017 Note, it is in the best interest of the City to accept the offer of the Original Purchaser to purchase the 2017 Note at a private negotiated sale,'which was based'upon a competitive selection process. Prior to the issuance of the 2017 Note,the City shall receive from the Original Purchaser a Purchaser's Certificate, in substantially the form attached hereto as Exhibit C and a Disclosure Letter containing the information required by Section 218:385, Florida Statutes, in substantially the form attached hereto as Exhibit D. Section 5-This Resolution to Constitute Contract. In consideration of the acceptance of the 2017 Note authorized to be issued hereunder by those who shall hold the same from timeto time, this Resolution shall be deemed to be and shall constitute a contract between the City and such Owner. 4 Section 6-Description of the 2017 Note. The 2017 Note shall be dated the date of its execution and delivery, which shall be a date agreed upon by the City and the Original Purchaser, subject to the following terms: (A) 2017 Interest Rate. The 2017 Note shall have a fixed interest rate equal to 2.63% per annum calculated on a 30/360-day basis, subject to adjustment as provided in the 2017 Note. (B) 2017 Principal and Interest Payment Dates. Interest on the 2017 Note shall be paid semi-annually on each June 1 and December 1, commencing December 1, 2017. Principal on the 2017 Note shall be paid in the amounts and on the dates set forth in the 2017 Note with a final maturity date of the 2017 Maturity Date. Other amounts due on the 2017 Note following a Determination of Taxability shall be paid as provided in the 2017 Note. (C) Prepayment of the 2017 Note. The 2017 Note shall be subject to prepayment as described in the 2017 Note. (D) Form of the 2017 Note. The 2017 Note is to be in substantially the form set forth in Exhibit B attached hereto, together with such non-material changes as shall be approved by the Mayor, such approval to be conclusively evidenced by the execution thereof by the Mayor. (E) Original Denomination of the 2017 Note. The 2017 Note shall originally be issued in a single denomination equal to the original principal amount authorized hereunder. (F) Maximum Average Annual Debt Service. The maximum average annual debt service on the 2017 Note shall not exceed $2,500,000. Section 7- Execution and Delivery of the 2017 Note. The 2017 Note shall be executed in the name of the City by its Mayor and attested by its City Clerk, subject to the approval of the City Attorney as to form and correctness, and the corporate seal of the City or a facsimile thereof shall be affixed thereto or reproduced thereon. In case any one or more of the officers of the City who shall have signed or sealed the 2017 Note shall cease to be such officer or officers of the City before the 2017 Note so signed and sealed shall have been actually sold and delivered, such 2017 Note may nevertheless be sold and delivered as if the persons who signed or sealed such 2017 Note had not ceased to hold such offices. The 2017 Note may be signed and sealed on behalf of the City by such person who at the actual time of the execution of such 2017 Note shall hold the proper office, although at the date of such execution of the 2017 Note such person may not have held such office or may not have been so authorized. 5 Section 8- Registration and Exchange of the 2017 Note; Persons Treated as Owner. The 2017 Note is initially registered to the Original Purchaser. The 2017 Note shall be delivered in physical form and will not be assigned a CUSIP number. So longus the 2017 Note shall remain unpaid,the City will keep books for the registration and transfer of the 2017 Note. The 2017 Note shall be transferable only upon such registration books. Notwithstanding anything herein to the contrary,the Original Purchaser may in the future make transfers, in whole or in part, or enter into participation agreements or securitization transactions with respect to the 2017 Note; provided, however; such transfers shall be only to Permitted Lenders and the 2017 Note may not be transferred in a denomination of less than $500,000 (or the total principal amount outstanding thereunder if less than $500,000). The Person in whose name the 2017 Note shall be registered shall be deemed and regarded as the absolute Owner thereof for all purposes, and payment of principal and interest on such 2017 Note shall be made only to or upon the written order of the Owner. All such payments shall be valid and effectual to satisfy and discharge the liability upon such 2017 Note to the extent of the sum or sums so paid. Section 9 -Payment of Principal and Interest; Limited Obligation. The City promises that it will promptly pay, by wire transfer of funds pursuant to instructions provided to the City by the Owners, the principal of and interest and other amounts due on the 2017 Note at the place,on the dates and in the manner provided therein according to the true intent and meaning hereof and thereof. The 2017 Note is secured by a pledge of and lien upon the Pledged Revenues in the manner and to the extent described herein. The 2017 Note shall not be or constitute a general obligation or indebtedness of the City as a""bond" within the meaning of Article VII, Section 12 of the Constitution of Florida,but shall be payable solely from the Pledged Revenues in accordance with the terms hereof. No Owner of the 2017 Note issued hereunder shall ever have the right to compel the exercise of any ad valorem taxing power or the use of ad valorem tax revenues to pay such 2017 Note, or be entitled to payment of such 2017 Note from any funds of the City except from the Pledged Revenues as described herein. Section 10 Covenant to Budget and Appropriate. (A) Subject to the next paragraph,the Citycovenants and agrees and has a positive and affirmative duty y.to appropriate in its annual budget, by amendment, if necessary, from Non-Ad Valorem Revenues, and to depositinto the Debt Service Fund hereinafter created, amounts sufficient to pay,principal of and interest on the 2017 Note not being paid from other amounts as the same shall become due. Such covenant_and agreement on the partof the City to budget, appropriate and deposit such amounts of Non-Ad Valorem Revenues shall be cumulative to the extent not paid, and shall continue until such Non-Ad Valorem Revenues or other legally available funds in amounts sufficient to make all such required payments shall have 6 been budgeted, appropriated, deposited and actually paid. No lien upon or pledge of such budgeted Non-Ad Valorem Revenues shall be in effect until such monies are budgeted, appropriated and deposited as provided herein. The City further acknowledges and agrees that the obligations of the City to include the amount of such amendments in each of its annual budgets and to pay such amounts from Non- Ad Valorem Revenues may enforced in a court of competent jurisdiction in accordance with the remedies set forth herein. Until such:monies are budgeted, appropriated and deposited as provided herein, such covenant to budget and appropriate does not create any lien upon or pledge of such Non-Ad Valorem Revenues, nor does it preclude the City frompledging in the future its Non-Ad Valorem Revenues (except as provided in Section 20 hereof), nor does it require the City to levy and collect any particular Non-Ad Valorem Revenues, nor does it give the Owner of the 2017 Note a prior claim on the Non- Ad Valorem Revenues as opposed to claims of general creditors of the City. Such covenant to budget and appropriate Non-Ad Valorem Revenues is subject in all respects to the prior payment of obligations secured by a lien on and pledge of specific components of the Non-Ad Valorem Revenues heretofore or hereafter entered into (including the payment of debt service on bonds and other debt instruments). Anything in this Resolution to the contrarynotwithstanding, it is understood and agreed that all obligations of the City hereunder shall be payable solely from the portion of Non-Ad Valorem Revenues budgeted, appropriated and deposited as provided for herein and nothing herein shall be deemed to pledge ad valorem tax power or ad valorem taxing revenues or to permit or constitute a mortgage or lien upon any assets owned by the City and no holder of the 2017 Note nor any other person, may compelthe levy of ad valorem taxes on real or personal property within the boundaries of the City or the use or application of ad valorem tax revenues in order to satisfy any payment obligations hereunder or to maintain or continue any of the activities of the City which generate user service charges, regulatory fees, or any other Non-Ad Valorem Revenues. Notwithstanding any provisions of this Resolution or the 2017 Note to the contrary, the City shall never be obligated to maintain or continue any of the activities of the City which generate user service charges,regulatory fees or any Non-Ad Valorem Revenues. The City is prohibited by law from expending moneys not appropriated or in excess of its current budgeted revenues and surpluses. Until such monies are budgeted, appropriated and deposited as provided herein, neither this Resolution nor the obligations of the City hereunder shall be construed as a pledge of or a lien on all or any legally available Non-Ad Valorem Revenues of the City,but shall be payable solely as provided herein subject to the availability of Non-Ad Valorem Revenues after satisfaction of funding requirements for obligations having an express lien on or pledge of such revenues and funding requirements for essential governmental services of the City. 7 There is hereby created and established the "City of Clermont, Florida Master Plan Capital Projects Revenue Note, Series 2017 Debt Service Fund," which fund shall be a trust fund held by the Finance Director, which shall be held solely for the benefit of the Owner of the 2017 Note. The Debt Service Fund shall be deemed to be held in trust for the purposes provided herein for such Debt Service Fund. The money in such Debt Service Fund shall be continuously secured in the same manner as state and municipal deposits are authorized to be secured by the laws of the State. The designation and establishment of the Debt Service Fund in and by this Resolution shall not be construed to require the establishment of a completely independent, self-balancing fund as such term is commonly defined and used in governmental accounting, but rather is intended solely to constitute an earmarking of certain revenues and assets of the City for certain purposes and to establish certain priorities for application of such revenues and assets as herein provided. The City may at any time and from time to time appoint one or more depositaries to hold, for the benefit of the Owner of the 2017 Note, the Debt Service Fund established hereby. Such depository or depositaries shall perform at the direction of the City the duties of the City in depositing, transferring and disbursing moneys to and from such Debt Service Fund as herein set forth, and all records of such depository in performing such duties shall be open at all reasonable times to inspection by the City and its agent and employees. Any such depository shall be a bank or trust company duly authorized to exercise corporate trust powers and subject to examination by federal or state authority, of good standing, and having a combined capital, surplus and undivided profits aggregating not less than fifty million dollars ($50,000,000). (B) Until applied in accordance with this Resolution, the Non-Ad Valorem Revenues of the City on deposit in the Debt Service Fund and other amounts on deposit from time to time therein,plus any earnings thereon, are pledged to the repayment of the 2017 Note. Section 11 -Application of Proceeds of 2017 Note. The proceeds received from the sale of the 2017 Note shall be applied by the City simultaneously with the delivery of the 2017 Note to the Original Purchaser, as follows: (A) To the extent not reimbursed therefor by the Original Purchaser of the 2017 Note, the City shall pay all costs and expenses in connection with the preparation, issuance and sale of the 2017 Note; and (B) Remaining proceeds shall be deposited in the Project Fund(as hereinafter created). 8 The City covenants and agrees to establish a special fund to be designated "City of Clermont,Florida Master Plan Capital Projects Revenue Note, Series 2017,Project Fund." The designation and establishment of the Project Fund by this Resolution shall not be construed to require the establishment of a completely independent, self-balancing fund as such term is commonly defined and used in governmental accounting, but rather is intended solely to constitute an earmarking of certain assets of the City for certain purposes and to establish certain priorities for application of such assets as herein provided. ,Amounts on deposit from time to time in the Project Fund, plus any earnings thereon, are pledged to the repayment of the 2017 Note. Costs of the Project will be paid from the Project Fund. The City covenants that the acquisition, constructionand equipping of the Project will be completed without delay and in accordance with sound engineering practices. The City shall make disbursements or payments form the Project Fund to pay the Costs of the.Project upon the filing with the City Clerk of documents and/or certificates"signed by an Authorized City Officer stating with respect to each disbursement or payment to be made: (i) the,item number of the payment, (ii) the name and address of the payeeto whom payment is due, (iii)the amount to be paid, (iv) the purpose by general classification for which payment is to be made and (v) that (A) each obligation item of cost or expense mentioned therein has been properly incurred, is in payment of a of the Costs of Project and is a proper charge against the Project Fund and has not been the basis of any previous disbursement or payment,or(B)each obligation,item of cost or expense mentioned therein has been paid by the City, is a reimbursement of the part of the Costs of the Project, is a proper charge against the Project Fund, has not been theretofore reimbursed to the City or otherwise been the basis of any previous disbursement or payment and the City is entitled to reimbursement thereof The City Clerk shall retain all such documents and/or certificates of the Authorized City Officers for seven (7) years.from the dates of such documents and/or certificates. The City Clerkshall make available the documents and/or certificates at all reasonable times for inspection by the Owner or the agent:or representative of the Owner. The City shall provide to the Owner a quarterly accounting of the application of proceeds deposited in the Project Fund during the construction period, commencing with the calendar quarter ending June 30, 2017. The date of completion of the Project shall be determined by an Authorized City Officer who shall certify such fact in writing to the City Council. Promptly after the date of the completion of the Project, and after paying for making provisions for'all unpaid.items of the Costs of the Project, the City shall transfer the balance of any moneys remaining in the Project Fund to such fund-or account of the City as shall be determined by the City.Council for application to the payment of any legally permissible cost,provided the City has received an opinion of Note Counsel to the effect that such transfer shall not adversely affect the exclusion of interest on the Note from gross income for federal income tax purposes. 9 Section 12 - Permitted Investments. Moneys on deposit in the Project Fund and Debt Service Fund may be invested in accordance with the City's Investment Policy approved pursuant to Resolution No. 2015-14 adopted by the City Council on March 24, 2015, as such Investment Policy may be amended from time to time by resolution of the City Council. Section 13 - Tax Covenant. (A) The City hereby covenants with the Owners of the 2017 Note that in order to maintain the exclusion from gross income for purposes of federal income taxation of interest on the 2017 Note, it shall comply with each requirement of the Code applicable to the 2017 Note. In furtherance of the covenant contained in the preceding sentence, the City agrees to continually comply with the provisions of the Tax Certificate to be executed by the City relating to the 2017 Note, as such Certificate may be amended from time to time, as a source of guidance for achieving compliance with the Code(referred to herein as the"Tax Certificate"). (B) The City hereby covenants with the Owners of the 2017 Note that it shall make any and all payments required to be made to the United States Department of the Treasury in connection with the 2017 Note pursuant to Section 148(f) of the Code. (C) So long as necessary in order to maintain the exclusion from gross income of interest on the 2017 Note for federal income tax purposes,the covenants contained in this Section 13 shall survive the payment of the 2017 Note and the interest thereon, including any payment or defeasance thereof. Section 14.-Audit,Budget and Other Information. The City will furnish to the Owners (i) within 210 days of the end of each Fiscal Year, a comprehensive annual financial report of the City for such Fiscal Year which shall include a balance sheet as of the end of such fiscal year, audited without scope limitations by independent certified public accountants, (ii)within 30 days of such adoption the annual budget of the City for the upcoming Fiscal Year, a copy of such annual budget, and (iii) upon the written request of the Owners such other information as the Owners may require. Reports shall be prepared in accordance with generally accepted accounting principles and provided to the Owners without charge. Section 15-Amendment. This Resolution shall not be modified or amended in any respect subsequent to the issuance of the 2017 Note, except with the written consent of the Owners of at least 66 2/3% in outstanding principal amount of the 2017 Note. 10 Section 16- Limitation of Rights. With the exception of any rights herein expressly conferred, nothing expressed or mentioned in or to be implied from this Resolution or the 2017 Note is intended or shall be construed to give to any person other than the City and the Owners any legal or equitable right,remedy or claim under or with respect to this Resolution or any covenants, conditions and provisions herein contained. This Resolution and all of the covenants, conditions and provisions hereof being intended to be and being for the sole and exclusive benefit of the City and the Owners. Section 17 -2017 Note Mutilated,Destroyed, Stolen or Lost. In case the 2017 Note shall become mutilated, or be destroyed, stolen or lost, the City shall issue and deliver new 2017 Note of like tenor as the 2017 Note so mutilated, destroyed, stolen or lost, in exchange and in substitution for such mutilated 2017 Note, or in lieu of and in substitution for the 2017 Note destroyed, stolen or lost and upon the Owner furnishing the City proof of ownership thereof and indemnity reasonably satisfactory to the City and complying with such other reasonable regulations and conditions as the City may prescribe and paying such expenses as the City may incur. The 2017 Note so surrendered shall be canceled. Section 18- Impairment of Contract. The City covenants with the Owners of the 2017 Note that it will not, without the written consent of the Owner of at least 66 2/3% in outstanding principal amount of the 2017 Note, enact any ordinance or adopt any resolution which repeals, impairs or amends in any manner adverse to the Owner the rights granted to the Owner of the 2017 Note hereunder. Section 19 - Events of Default; Remedies of the Owner of the 2017 Note. The following shall constitute "Events of Default": (i) if the City fails to pay any payment of principal of or interest on the 2017 Note or other debt payable from any Non-Ad Valorem Revenues as the same becomes due and payable; (ii) if the City defaults in the performance or observance of any covenant or agreement contained in this Resolution or the 2017 Note(other than set forth in(i) above) and fails to cure the same within thirty(30)days following notice thereof or from the date when the City was required under the immediately succeeding paragraph to provide notice thereof to the Owner of the 2017 Note; (iii)filing of a petition by or against the City relating to bankruptcy, reorganization, arrangement or readjustment of debt of the City or for any other relief relating to the City under the United States Bankruptcy Code, as amended, or any other insolvency act or law now or hereafter existing, or the involuntary appointment of a receiver or trustee for the City,and the continuance of any such event for 90 days undismissed or undischarged or (iv) one or more non-appealable judgments in an amount in the aggregate in excess of $5,000,000 shall be entered or filed against the City and remain unvacated, unpaid, unbonded or unstayed for a period of sixty (60) days and an Owner deems such an occurrence to be an Event of Default. 11 Upon the occurrence and during the continuation of any Event of Default, the Owners of the 2017 Note may, in addition to any other remedies set forth in this Resolution or the 2017 Note, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State, or granted or contained in this Resolution, and may enforce and compel the performance of all duties required by this Resolution,or by any applicable statutes to be performed by the City. Upon the occurrence of any Event of Default, upon the direction of the Owners of the 2017 Note, all amounts in the Project Fund shall promptly be applied to repayment of principal and interest and other amounts due on the 2017 Note. No remedy herein conferred upon or reserved to the Owners is intended to be exclusive of any other remedy or remedies herein provided,and each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder. No delay or omission of the Owners 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 any acquiescence therein; and every power and remedy given by this Resolution to the Owners may be exercised from time to time and as often as may be deemed expedient. The City shall reimburse the Owners(and their agents) for all reasonable legal and collection costs incurred in the exercise of remedies hereunder, to collect payments due under the 2017 Note or to enforce the provisions of this Resolution. Section 20 -Anti-Dilution Test. The City may incur additional debt secured by all or a portion of the Non-Ad Valorem Revenues only if the total amount of Non-Ad Valorem Revenues for the prior Fiscal Year(as reflected in the City's audited financial statements) were at least 1.25 times the maximum annual debt service of all debt to be paid from Non-Ad Valorem Revenues including the the additional debt to be issued (collectively, "Debt"), including any Debt payable from one or several specific revenue sources. For purposes of calculating maximum annual debt service if the terms of the Debt are such that interest thereon for any future period of time is to be calculated at a rate which is not then susceptible of precise determination ("Variable Rate Debt"), interest on such Variable Rate Debt shall be computed as follows: (A) if the principal amount of Variable Rate Debt (including any Variable Rate Debt proposed to be incurred) is less than or equal to 25% of the principal amount of all Debt (including the Debt proposed to be incurred), an interest rate equal to the higher of 12%per annum or The Bond Buyer 40 Index shall be assumed; or 12 (B) if the principal amount of Variable Rate Debt (including any Variable Rate Debt proposed to be incurred) is more than 25% of the principal amount of all Debt (including the Debt proposed to be incurred), the maximum rate which could be borne by such Variable Rate Debt shall be assumed. For purposes of calculating maximum annual debt service, balloon indebtedness shall be assumed to amortize in up to 20 years (from the date of calculation) on a level debt service basis. In the event that the City is required to fund a reserve fund, the funding of such reserve fund shall be included in the calculation of debt service. For purposes of this paragraph, "balloon indebtedness" includes indebtedness if 25% or more of the principal amount thereof comes due in any one year. Section 21 - Severability. If any one or more of the covenants, agreements or provisions of this Resolution should be held 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 shall be null and void and shall be deemed separate from the remaining covenants, agreements or provisions of this Resolution or of the 2017 Note issued thereunder. Section 22 -Business Days. In any case where the due date of interest on or principal of 2017 Note is not a Business Day, then payment of such principal or interest need not be made on such date but may be made on the next succeeding Business Day, provided that credit for payments made shall not be given until the payment is actually received by the Owners. Section 23 - Applicable Provisions of Law. This Resolution shall be governed by and construed in accordance with the laws of the State. Section 24-Rules of Interpretation. Unless expressly indicated otherwise, references to sections or articles are to be construed as references to sections or articles of this instrument as originally executed. Use of the words "herein," "hereby," "hereunder," "hereof," "hereinbefore," "hereinafter" and other equivalent words refer to this Resolution and not solely to the particular portion in which any such word is used. Section 25- Captions. The captions and headings in this Resolution are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Resolution. 13 Section 26- Members of the City Council Not Liable. No covenant, stipulation, obligation or agreement contained in this Resolution shall be deemed to be a covenant, stipulation, obligation or agreement of any present or future member, agent or employee of the City in his or her individual capacity,and neither the members of the City Council nor any person executing the 2017 Note shall be liable personally on the 2017 Note or this Resolution or shall be subject to any personal liability or accountability by reason of the issuance or the execution of the 2017 Note or this Resolution. Section 27- Authorizations. The members of the City Council, the Mayor, the Finance Director and the City's officers, attorneys and other agents and employees are hereby authorized to perform all acts and things required of them by this Resolution or desirable or consistent with the requirements hereof for the full, punctual and complete performance of all of the terms, covenants and agreements contained in the 2017 Note and this Resolution, and they are hereby authorized to execute and deliver all documents which shall be required by Note Counsel or the Original Purchaser to effectuate the sale of the 2017 Note. All action taken to date by the members of the City Council, the Mayor, the Finance Director and the City's officers, attorneys and other agents and employees in furtherance of the issuance of the 2017 Note is hereby approved, confirmed and ratified. Section 28- Superseding of Inconsistent Resolutions. This Resolution supersedes all prior action of City Council inconsistent herewith. All resolutions or parts thereof in conflict herewith are hereby superseded to the extent of such conflict. Section 29 -Effective Date. This Resolution shall become effective immediately upon its adoption. 14 PASSED, APPROVED AND ADOPTED by the City Council of the City of Clermont, Lake County, Florida, on this 13th day of June, 2017. CITY COUNCIL OF THE CITY OF THE CITY OF CLERMONT • rr '(OFEIt'IAL.SEAL) Y r,c4},k L fA if Gail L. Ash, Mayor Y_. ATTEST:' Tracy Ackroyd Howe, City Clerk Approve• .s to Form: 411Np]. AO% . . al ' ! i y orney EXHIBIT A PROJECT DESCRIPTION The Project consists of the acquisition, construction, equipping and/or installation of the following Master Plan capital projects: Victory Pointe - Victory Pointe is a regional stormwater project with a unique wetland filter marsh. It also has boardwalks, trails, a new event area, a pavilion and triathlon beach. Boat Ramp Relocation — In connection with the Victory Pointe project, the existing antiquated boat ramp will be improved and relocated. The improved boat ramp will provide for additional parking, safer and reduced trail crossing, improved lighting and improved vehicle-trailer stacking. The new boat ramp will be located on the western bank of Lake Minneola, adjacent to Lake Hiawatha Park. Downtown Waterfront District Revitalization - The Downtown Waterfront District area includes Montrose Street, Minneola Street and Osceola Street between 7th and 8th. The proposed improvements will consist of streetscape, landscaping, bathrooms, lighting, upgrades for event lighting and music, banners and beautification. A focal point will be created at City Hall Park to anchor downtown visitors, creating a destination and meeting point in the heart of downtown Clermont. The improvements will include a refurbished park at the 8th Street Pier named "Meet us in the Middle"Plaza. This plaza will be the demarcation and celebration of the half,way point of the Coast-to-Coast Trail. Legacy Loop Trail Spur- The Legacy loop and smaller connectivity projects will encourage trail users to travel through downtown from the heavily utilized South Lake Trail. The path of the loop is proposed to run along Minneola Avenue from 7th street to West of Victory Pointe. The first leg of the loop is between 7th and 8th on the North side of Minneola. Public Wi-Fi Network- Construction of a public Wi-Fi-network along the Clermont city limits of the Coast-to-Coast Trail (South Lake Trail). This project will allow for safer and more accurate navigation of the Coast-to-Coast Trail. Public Works Complex — Construction of a new Public Works Complex, including land purchase. The City has outgrown the current complex which was built in 1989. The new complex is anticipated to be approximately 40,000 square feet and will house the City's Fleet, Facilities, Ground and Streets maintenance operations. City Limits Entryway Signs — The network of signs will identify the City's boundaries, differentiating the City from unincorporated areas, create a destination and magnify the City's brand of"Choice of Champions." EXHIBIT B FORM OF 2017 NOTE UNITED STATES OF AMERICA STATE OF FLORIDA CITY OF CLERMONT MASTER PLAN CAPITAL PROJECTS REVENUE NOTE SERIES 2017 Dated Date: June , 2017 Interest Rate: 2.63%, Maturity Date: December 1, 2032 subject to adjustment as provided herein KNOW ALL MEN BY THESE PRESENTS that the City of Clermont (the "City"), a municipal corporation created and existing pursuant to the Constitution and the laws of the State of Florida, for value received,promises to pay from the sources hereinafter provided, to the order of Pinnacle Public Finance,Inc.,or registered assigns(hereinafter,the"Owner"),the principal sum of$ , on the Maturity Date set forth above, except to the extent earlier prepaid, upon presentation and surrender hereof to the City, and to pay interest on the outstanding principal balance hereof at the "Interest Rate" described above and herein, calculated on a 30/360-day basis, on each June 1 and December 1, commencing on December 1,2017,provided,however,that such Interest Rate shall in no event exceed the maximum interest rate permitted by applicable law. Upon the occurrence of an Event of Taxability (defined below) resulting from an act or omission of the City and following a Determination of Taxability(defined below),this Note or the affected portions thereof will bear interest at a rate of interest per annum from the date of the Event of Taxability (defined below) relating thereto equal to 4.05% per annum (the "Taxable Rate"). "Determination of Taxability" means (i) receipt by the City of a final judgment by a court of competent jurisdiction or a final official action of the Internal Revenue Service determining that an Event of Taxability has occurred, (ii) receipt by the City and the Owner of an unqualified opinion of a nationally recognized bond counsel firm selected by the Owner to the effect that the interest on this Note has become includable in the gross income of the Owner, or(iii) at such time as the City and the Owner have mutually agreed that an Event of Taxability has occurred (the date of the Determination of Taxability, the "Taxable Date"). "Event of Taxability" means the circumstance of any interest paid or payable with respect to this Note being includable or becoming includable in the gross income of the Owner for federal income tax purposes. In addition to the payments of interest on this Note at the Taxable Rate on and after the Taxable Date,the City hereby agrees to pay to the Owner,within 30 days of the occurrence of a Determination of Taxability, (A) an amount equal to the difference between (x) the amount of interest actually paid on this Note during the Prior Taxable Period and (y) the amount of interest that would have been paid on this Note during the Prior Taxable Period had this Note borne interest at the Taxable Rate plus (B) an amount equal to all penalties, fines, interest and additions to tax (including all federal, state and local taxes imposed on the interest on this Note due and through the Taxable Date)that are imposed on the interest on this Note or the Owner as a result of the loss of the exclusion. "Prior Taxable Period"means, with respect to this Note,the period which elapses from the earliest date on which the interest on this Note is includable in the gross income of the holder thereof(which may be as early as the Dated Date)to the Taxable Date. In the event any principal of or interest on this Note is not paid when due and payable, this Note shall bear interest at the Default Rate. "Default Rate"means the rate per annum equal to the lesser of(i) 6.00% or, if an Event of Taxability resulting from an act or omission of the City has occurred, 7.00%, or (ii) the maximum rate of interest permitted by law, in either case, from the date any principal of or interest on this Note has not been paid when due and payable until such principal or interest has been paid. All payments by the City pursuant to this Note shall apply first to accrued interest, then to other charges due the Owner, and the balance thereof shall apply to principal. Unless earlier prepaid, the principal amount of this Note shall be prepaid pursuant to mandatory sinking fund prepayments, without prior notice to the Owner, in the following Amortization Amounts on the following dates: Dates Amortization Amounts 12/01/2018 12/01/2019 12/01/2020 12/01/2021 12/01/2022 12/01/2023 12/01/2024 12/01/2025 12/01/2026 12/01/2027 12/01/2028 12/01/2029 12/01/2030 12/01/2031 12/01/2032* *Maturity A final payment in the amount of the remaining principal balance,together with all accrued and unpaid interest hereon, shall be due and payable in full on the Maturity Date. Except as provided in the next succeeding paragraph, this Note may not be prepaid and redeemed at the option of the City prior to December 1, 2022. On and after December 1, 2022, the City may prepay and redeem this Note in whole but not in part at any time upon five Business Days'prior written notice to the Owner at a redemption price equal to the principal amount of this Note to be prepaid,plus accrued interest thereon to the prepayment date. Such prepayment notice shall specify the amount of the prepayment which is to be made. On and prior to June _, 2019, the City shall have one-time extraordinary prepayment option and may prepay and redeem this Note in part,in a principal amount not to exceed$3 million, at any time upon five Business Days' prior written notice to the Owner at a redemption price equal to the principal amount of this Note to be prepaid,plus accrued interest thereon to the prepayment date. Such prepayment notice shall specify the prepaid amount of prepayment which is to be made. Notwithstanding anything herein or in the Resolution to the contrary, the Owner shall not be required to (i) surrender or cancel this Note until it has received all amounts owing and due thereunder and under the Resolution, or (ii) surrender this Note for prepayment or principal installment payments. A partial prepayment resulting from an extraordinary optional prepayment of this Note as described above shall be applied and credited to the unpaid Amortization Amounts specified above (including the Amortization Amount payable on the Maturity Date) payable pursuant to the mandatory sinking fund prepayments required hereunder on a pro rata basis treating each Amortization Amount as a maturity. In the event that the entire unpaid balance of the principal of this Note is to be prepaid, such prepayment shall be made upon presentation and surrender of this Note at the office of the Owner. If on the prepayment date moneys for the payment of the principal amount to be prepaid on this Note,together with interest to the prepayment date on such principal amount shall have been paid to the Owner as above provided and if notice of prepayment shall have been given to the Owner as above provided, then from and after the prepayment date interest on such principal amount of this Note shall cease to accrue. If said moneys shall not have been so paid on the prepayment date, such principal amount of this Note shall continue to bear interest until payment thereof at the rate or rates provided for herein. THIS NOTE DOES NOT CONSTITUTE A GENERAL INDEBTEDNESS OF THE CITY WITHIN THE MEANING OF ANY CONSTITUTIONAL, STATUTORY OR CHARTER PROVISION OR LIMITATION, AND IT IS EXPRESSLY AGREED BY THE OWNER OF THIS NOTE THAT SUCH OWNER SHALL NEVER HAVE THE RIGHT TO REQUIRE OR COMPEL THE EXERCISE OF THE AD VALOREM TAXING POWER OF THE CITY OR TAXATION OF ANY REAL OR PERSONAL PROPERTY THEREIN OR THE USE OF AD VALOREM TAX REVENUES FOR THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THIS NOTE OR THE MAKING OF ANY OTHER PAYMENTS PROVIDED FOR IN THE RESOLUTION. This Note is issued pursuant to Constitution of the State of Florida, Chapter 166, Part II, Florida Statutes, the municipal charter of the City and other applicable provisions of law, and a resolution duly adopted by the City on June , 2017, as amended and supplemented from time to time(herein referred to as the"Resolution"), and is subject to all the terms and conditions of the Resolution. All terms, conditions and provisions of the Resolution including, without limitation, remedies in the Event of Default are by this reference thereto incorporated herein as a part of this Note. Payment of the Note is secured by a covenant to budget, appropriate and deposit Non-Ad Valorem Revenues of the City and,a pledge of and lien upon the Pledged Revenues,in the manner and to the extent described in the Resolution. Terms used herein in capitalized form and not otherwise defined herein shall have the meanings ascribed thereto in the Resolution. This Note may be exchanged or transferred by the Owner hereof to any Permitted Lender but only upon the registration books maintained by the City and in the manner provided in the Resolution. The City to the extent permitted by law hereby waives presentment, demand, protest and notice of dishonor. No official, agent or employee of the City approving or executing this Note shall be liable personally on this Note or be subject to any personal liability or accountability by reason of the issuance of this Note. It is hereby certified,recited and declared that all acts,conditions and prerequisites required to exist, happen and be performed precedent to and in the execution, delivery and the issuance of this Note do exist, have happened and have been performed in due time, form and manner as required by law, and that the issuance of this Note is in full compliance with and does not exceed or violate any constitutional or statutory limitation. IN WITNESS WHEREOF, the City of Clermont, Florida, has issued this Note and has caused the same to be executed by its Mayor, attested by its City Clerk, approved as to form by its City Attorney,either manually or with their facsimile signatures,and the corporate seal of the City, or a facsimile thereof to be impressed, imprinted or otherwise reproduced hereon, all as of the dated date set forth above. CITY OF CLERMONT, FLORIDA .;,=(OFFICIAL SEAL); By / &it/ Gail L. Ash, Mayor ATTESTED AND Approved as to Form: COUNTERSIGNED: 111 c- itat:eit. :-. eia,L 0_ ►i—_`—arts, 1 . - _ Tracy Ackroyd Howe, City Clerk EXHIBIT C FORM OF PURCHASER'S CERTIFICATE This is to certify that Pinnacle Public Finance, Inc. (the "Purchaser") has not required the City of Clermont,Florida(the"City")to deliver any offering document and has conducted its own investigation, to the extent it deems satisfactory or sufficient, into matters relating to business affairs or conditions (either financial or otherwise) of the City in connection with the issuance by the City of its $ Master Plan Capital Projects Revenue Note, Series 2017 (the "2017 Note"). No inference should be drawn that the Purchaser, in the acceptance of said 2017 Note, is relying on Note Counsel or the City Attorney as to any such matters other than the legal opinions rendered by Note Counsel and by the City Attorney, (the "City Attorney"). Any capitalized undefined terms used herein not otherwise defined shall have the meaning set forth in a resolution adopted by the City Council of the City on June , 2017 (the "Resolution"). We are aware that purchase of the 2017 Note involves various risks, that the 2017 Note is not a general obligation of the City or payable from ad valorem tax revenues, and that the payment of the 2017 Note is secured solely from the sources described in the Resolution (the "Note Security"). We have made such independent investigation of the Note Security as we, in the exercise of sound business judgment, consider to be appropriate under the circumstances. We have knowledge and experience in financial and business matters and are capable of evaluating the merits and risks of our investment in the 2017 Note and can bear the economic risk of our purchase of the 2017 Note. We acknowledge that the Resolution is not being qualified under the Trust Indenture Act of 1939, as amended(the "1939 Act"), and is not being registered, in reliance upon the exemption from registration under Section 3(a)(2) of the Securities Act of 1933, Section 517.051(1), Florida Statutes, and/or Section 517.061(7), Florida Statutes, and that neither the City, Note Counsel nor the City Attorney shall have any obligation to effect any such registration or qualification. We are not acting as a broker or other intermediary, and are purchasing the 2017 Note for our own loan portfolio and not with a present view to a resale or other distribution to the public. We understand that the 2017 Note may be transferred in whole or in part; provided, however, we understand that the 2017 Note may only be transferred in accordance with the limitations set forth in the Resolution. We are a bank, trust company, savings institution, insurance company, dealer, investment company, pension or profit-sharing trust, or qualified institutional buyer as contemplated by Section 517.061(7),Florida Statutes. We are not purchasing the 2017 Note for the direct or indirect promotion of any scheme or enterprise with the intent of violating or evading any provision of Chapter 517, Florida Statutes. We are directly or indirectly controlled by BankUnited, National Association, a national banking association.. DATED this_day of June, 2017. PINNACLE PUBLIC FINANCE, INC. By: Name: Cathleen D. Jimenez Title: Managing Director/Executive Vice President EXHIBIT D FORM OF DISCLOSURE LETTER Following a competitive selection process, the undersigned, as purchaser, proposes to negotiate with City of Clermont, Florida (the "City") for the private purchase of its $ Master Plan Capital Projects Revenue Note, Series 2017 (the "2017 Note"). Prior to the award of the 2017 Note, the following information is hereby furnished to the City: 1. Set forth is an itemized list of the nature and estimated amounts of expenses to be incurred for services rendered to us (the "Purchaser") in connection with the issuance of the 2017 Note(such fees and expenses to be paid by the Purchaser): $7,500 Chapman and Cutler LLP, Purchaser's Counsel Legal Fees 2. (a) No other fee, bonus or other compensation is estimated to be paid by the Purchaser in connection with the issuance of the 2017 Note to any person not regularly employed or retained by the Purchaser (including any "finder" as defined in Section 218.386(1)(a), Florida Statutes), except as specifically enumerated as expenses to be incurred by the Purchaser, as set forth in paragraph (1) above. (b) No person has entered into an understanding with the Purchaser, or to the knowledge of the Purchaser, with the City, for any paid or promised compensation or valuable consideration,directly or indirectly, expressly or implied,to act solely as an intermediary between the City and the Purchaser or to exercise or attempt to exercise any influence to effect any transaction in the purchase of the 2017 Note. 3. The amount of the underwriting spread expected to be realized by the Purchaser is $0. 4. The management fee to be charged by the Purchaser is $0. 5. Truth-in-Bonding Statement: Unless earlier prepaid, the 2017 Note is expected to be repaid by December 1, 2032; at an interest rate of 2.63%, total interest paid over the life of the 2017 Note is estimated to be The 2017 Note will be payable solely from a covenant to budget, appropriate and deposit from Non-Ad Valorem Revenues sufficient to make such payments, appropriated and deposited as described in a resolution of the City adopted on June , 2017 (the "Resolution"). See the Resolution for a definition of Non-Ad Valorem Revenues. Issuance of the 2017 Note is estimated to result in an annual average of approximately $ of revenues of the City not being available to finance the services of the City during the life of the 2017 Note. This paragraph is provided;pursuant to Section 218.385, Florida Statutes. 6. The name and address of the Purchaser is as follows: Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale,Arizona-85255 IN WITNESS WHEREOF, the-undersigned has executed this Disclosure Letter on behalf of the Purchaser this day of June, 2017. PINNACLE PUBLIC FINANCE, INC. By: Name: Cathleen D. Jimenez Title: Managing Director/Executive Vice President e.� $30,000,000 UNITED STATES OF AMERICA STATE OF FLORIDA CITY OF CLERMONT MASTER PLAN CAPITAL PROJECTS REVENUE NOTE SERIES 2017 Dated Date: June 19, 2017 Interest Rate: 2.63%, Maturity Date: December 1, 2032 subject to adjustment as provided herein KNOW ALL MEN BY THESE PRESENTS that the City of Clermont (the "City"), a municipal corporation created and existing pursuant to the Constitution and the laws of the State of Florida, for value received,promises to pay from the sources hereinafter provided, to the order of Pinnacle Public Finance, Inc., or registered assigns (hereinafter, the "Owner"), the principal sum of THIRTY MILLION DOLLARS ($30,000,000.00), on the Maturity Date set forth above, except to the extent earlier prepaid, upon presentation and surrender hereof to the City, and to pay interest on the outstanding principal balance hereof at the "Interest Rate" described above and herein, calculated on a 30/360-day basis, on each June 1 and December 1, commencing on December 1, 2017, provided, however, that such Interest Rate shall in no event exceed the maximum interest rate permitted by applicable law. Upon the occurrence of an Event of Taxability (defined below) resulting from an act or omission of the City and following a Determination of Taxability (defined below), this Note or the affected portions thereof will bear interest at a rate of interest per annum from the date of the Event of Taxability (defined below) relating thereto equal to 4.05% per annum (the "Taxable Rate"). "Determination of Taxability" means (i) receipt by the City of a final judgment by a court of competent jurisdiction or a final official action of the Internal Revenue Service determining that an Event of Taxability has occurred, (ii) receipt by the City and the Owner of an unqualified opinion of a nationally recognized bond counsel firm selected by the Owner to the effect that the interest on this Note has become includable in the gross income of the Owner, or (iii) at such time as the City and the Owner have mutually agreed that an Event of Taxability has occurred (the date of the Determination of Taxability, the "Taxable Date"). "Event of Taxability" means the circumstance of any interest paid or payable with respect to this Note being includable or becoming includable in the gross income of the Owner for federal income tax purposes. In addition to the payments of interest on this Note at the Taxable Rate on and after the Taxable Date, the City hereby agrees to pay to the Owner, within 30 days of the occurrence of a Determination of Taxability, (A) an amount equal to the difference between (x) the amount of interest actually paid on this Note during the Prior Taxable Period and (y) the amount of interest that would have been paid on this Note during the Prior Taxable Period had this Note borne interest at the Taxable Rate plus (B) an amount equal to all penalties, fines, interest and additions to tax (including all federal, state and local taxes imposed on the interest on this Note due and through the Taxable Date) that are imposed on the interest on this Note or the Owner as a result of the loss of the exclusion. "Prior Taxable Period" means, with respect to 4832-2734-0874.3 • this Note, the period which elapses from the earliest date on which the interest on this Note is includable in the gross income of the holder thereof(which may be as early as the Dated Date) to the Taxable Date. In the event any principal of or interest on this Note is not paid when due and payable, this Note shall bear interest at the Default Rate. "Default Rate" means the rate per annum equal to the lesser of(i) 6.00% or, if an Event of Taxability resulting from an act or omission of the City has occurred, 7.00%, or (ii) the maximum rate of interest permitted by law, in either case, from the date any principal of or interest on this Note has not been paid when due and payable until such principal or interest has been paid. All payments by the City pursuant to this Note shall apply first to accrued interest,then to other charges due the Owner, and the balance thereof shall apply to principal. Unless earlier prepaid, the principal amount of this Note shall be prepaid pursuant to mandatory sinking fund prepayments, without prior notice to the Owner, in the following Amortization Amounts on the following dates: Dates Amortization Amounts 12/01/2018 $ 1,657,000 12/01/2019 1,701,000 12/01/2020 1,746,000 12/01/2021 1,791,000 12/01/2022 1,839,000 12/01/2023 1,887,000 12/01/2024 1,937,000 12/01/2025 1,987,000 12/01/2026 2,040,000 12/01/2027 2,093,000 12/01/2028 2,148,000 12/01/2029 2,205,000 12/01/2030 2,263,000 12/01/2031 2,322,000 12/01/2032* 2,384,000 *Maturity A final payment in the amount of the remaining principal balance, together with all accrued and unpaid interest hereon, shall be due and payable in full on the Maturity Date. Except as provided in the next succeeding paragraph, this Note may not be prepaid and redeemed at the option of the City prior to December 1, 2022. On and after December 1, 2022, the City may prepay and redeem this Note in whole but not in part at any time upon five Business Days' prior written notice to the Owner at a redemption price equal to the principal amount of this Note to be prepaid, plus accrued interest thereon to the prepayment date. Such prepayment notice shall specify the amount of the prepayment which is to be made. 2 4832-2734-0874.3 • On and prior to June 19, 2019, the City shall have one-time extraordinary prepayment option and may prepay and redeem this Note in part, in a principal amount not to exceed $3 million, at any time upon five Business Days' prior written notice to the Owner at a redemption price equal to the principal amount of this Note to be prepaid, plus accrued interest thereon to the prepayment date. Such prepayment notice shall specify the prepaid amount of prepayment which is to be made. Notwithstanding anything herein or in the Resolution to the contrary, the Owner shall not be required to (i) surrender or cancel this Note until it has received all amounts owing and due thereunder and under the Resolution, or (ii) surrender this Note for prepayment or principal installment payments. A partial prepayment resulting from an extraordinary optional prepayment of this Note as described above shall be applied and credited to the unpaid Amortization Amounts specified above (including the Amortization Amount payable on the Maturity Date) payable pursuant to the mandatory sinking fund prepayments required hereunder on a pro rata basis treating each Amortization Amount as a maturity. In the event that the entire unpaid balance of the principal of this Note is to be prepaid, such prepayment shall be made upon presentation and surrender of this Note at the office of the Owner. If on the prepayment date moneys for the payment of the principal amount to be prepaid on this Note, together with interest to the prepayment date on such principal amount shall have been paid to the Owner as above provided and if notice of prepayment shall have been given to the Owner as above provided, then from and after the prepayment date interest on such principal amount of this Note shall cease to accrue. If said moneys shall not have been so paid on the prepayment date, such principal amount of this Note shall continue to bear interest until payment thereof at the rate or rates provided for herein. THIS NOTE DOES NOT CONSTITUTE A GENERAL INDEBTEDNESS OF THE CITY WITHIN THE MEANING OF ANY CONSTITUTIONAL, STATUTORY OR CHARTER PROVISION OR LIMITATION, AND IT IS EXPRESSLY AGREED BY THE OWNER OF THIS NOTE THAT SUCH OWNER SHALL NEVER HAVE THE RIGHT TO REQUIRE OR COMPEL THE EXERCISE OF THE AD VALOREM TAXING POWER OF THE CITY OR TAXATION OF ANY REAL OR PERSONAL PROPERTY THEREIN OR THE USE OF AD VALOREM TAX REVENUES FOR THE PAYMENT OF THE PRINCIPAL OF AND INTEREST ON THIS NOTE OR THE MAKING OF ANY OTHER PAYMENTS PROVIDED FOR IN THE RESOLUTION. This Note is issued pursuant to Constitution of the State of Florida, Chapter 166, Part II, Florida Statutes, the municipal charter of the City and other applicable provisions of law, and a resolution duly adopted by the City on June 13, 2017, as amended and supplemented from time to time (herein referred to as the "Resolution"), and is subject to all the terms and conditions of the Resolution. All terms, conditions and provisions of the Resolution including, without limitation, remedies in the Event of Default are by this reference thereto incorporated herein as a part of this Note. Payment of the Note is secured by a covenant to budget, appropriate and deposit Non-Ad Valorem Revenues of the City and a pledge of and lien upon the Pledged Revenues, in the manner and to the extent described in the Resolution. Terms used herein in 3 4832-2734-0874.3 capitalized form and not otherwise defined herein shall have the meanings ascribed thereto in the Resolution. This Note may be exchanged or transferred by the Owner hereof to any Permitted Lender but only upon the registration books maintained by the City and in the manner provided in the Resolution. The City to the extent permitted by law hereby waives presentment, demand, protest and notice of dishonor. No official, agent or employee of the City approving or executing this Note shall be liable personally on this Note or be subject to any personal liability or accountability by reason of the issuance of this Note. It is hereby certified, recited and declared that all acts, conditions and prerequisites required to exist, happen and be performed precedent to and in the execution, delivery and the issuance of this Note do exist, have happened and have been performed in due time, form and manner as required by law, and that the issuance of this Note is in full compliance with and does not exceed or violate any constitutional or statutory limitation. [Remainder of Page Intentionally Left Blank; Signature Page Follows] 4 4832-2734-0874.3 IN WITNESS WHEREOF, the City of Clermont, Florida, has issued this Note and has caused the same to be executed by its Mayor, attested by its City Clerk, approved as to form by its City Attorney, either manually or with their facsimile signatures, and the corporate seal of the City, or a facsimile thereof to be impressed, imprinted or otherwise reproduced hereon, all as of the dated date set forth above. / CITY OF CLERMONT, FLORIDA (OFFICIAL SEAL) By:.)leiel?!C:2Z(Zi__ —`Gail L. Ash, Mayor ATTESTED AND COUNTERSIGNED: Approved as_to- i rm: Jj By: By41 OP lb Tracy Ackroyd Howe, City Clerk :.fie . Mantzaris, City Attorney [Signature Page to Master Plan Capital Projects Revenue Note]