1939-01A G R E E MEN T.
THIS AGREEMENT, made and entered into as of the 9th day of May,
A. D. 1939, by and between CITY OF CLERMONT, FLORIDA (hereinafter referred
to as the City), and LEEDY, WHEELER & COMPANY, a Florida corporation,
of Orlando, Florida (hereinafter referred to as "Fiscal Agent;"
WIT N E SSE T H:
That in consideration of the sum of one dollar ($1.00) paid by
the City and Fiscal Agent to each other, receipt of which is hereby mutually
acknowledged, and in further consideration of the mutual benefits flowing
to the parties hereto. it is hereby mutually agreed as follows:
(1) That the City shall issue Refunding Bonds in such
denomination and in such amount as shall be necessary to refund by the
exchange method all of the City's now outstanding bonds, approximately
$884,300.00; at fifty per centum (50%) of the principal amount of such bonds
now outstanding.
The term, "outstanding bonds," herein used shall be
construed to include not only the actual bonds now outstanding, but also
any and all bonds of said City which have been reduced to judgment, in
like manner as if no judgment had been obtained thereon.
All of such refunding bonds shall be dated July 1, 1939,
shall mature thirty (30) years after such date, or July 1, 1969, and shall
be callable at par, plus accrued interest, upon any interest payment date.
Said Refunding Bonds shall bear interest, payable semiannually, at the
following rates:
2% for four (4) years, beginning July 1, 1939,
2 1/2% for the next f'our (4) years,
3% for the next four (4) years,
3 1/2% for the next four (4) years,
4% for the next four (4) years,
4 1/2% for the next five (5) years,
5% for the next five (5) years,
and principal and interest shall be payable at such bank in the City of
New York as may hereafter be agreed upon.
(2) That all the Refunding Bonds provided for herein shall
be general obligations of the City of Clermont, for the payment of which
its full faith, credit and taxing power shall be pledged. Said Refunding
Bonds shall be payable from an unlimited ad valorem tax levied upon all
the taxable property. including homesteads, within the city, except only
such property as would be exempt from taxation under the provisions of the
laws and Constitution of the State of Florida which were in force and effect
at the time of the creation of the indebtedness refunded hereby.
(3) That all unpaid interest on the presently outstanding,
bonds accrued up to and due July 1, 1939, shall be refunded by the issuance
of Delinquent Tax Notes in an amount equal to the amount of interest
refunded thereby.
Said Delinquent Tax Notes shall be issued in negotiable
form, shall be dated July 1. 1939, shall bear no interest, and shall have no
definite maturity date. but shall be redeemable in whole or in part by the
City, through its Fiscal Agent, at fifteen per centum (15%) of the face
value thereof, and may be purchased and resold by the City to its taxpayers
for use as is hereinafter provided.
For the payment or purchase of said Delinquent Tax Notes
the City hereby pledges, to the extent it may legally do so all unpaid
taxes for the year 1930 and prior years, the special taxes to be levied
for the years 1931 to 1937, inclusive (Section 8), and all unpaid special
assessment liens.
When the proceeds from such taxes and liens shall
amount to the sum of $100.00 or more in such fund, the City shall
immediately disburse such balance pro rata to the owners of Delinquent Tax
Notes, through its Fiscal Agent, as provided herein.
Said Delinquent Tax Notes may be accepted by the City at their
par value in payment of the taxes and liens pledged as hereinafter provided,
and further provided. as to taxes. that the 1939 and subsequent taxes have
been previously paid or are simultaneously paid.
The term, "all unpaid interest," herein used shall be construed
to include not only unpaid interest coupons and interest accruals of the
outstanding bonds, but also any and all interest items which may have been
reduced to judgment, in like manner as if no judgment had been obtained
thereon.
(4) That for the purpose of adequately providing for the
payment of interest on said refunding bonds, and for the creation and
maintenance of a sinking fund for the retirement of the Refunding Bonds,
the proceedings authorizing the issuance of' such Refunding Bonds shall conform
to the tax provision requirements of such laws of Florida providing for the
refunding of indebtedness as shall be approved by the attorneys who pass upon
the validity of the Refunding Bonds to be issued.
Such proceedings authorizing the issuance of the Refunding Bonds
shall contain enforceable and effective obligations and covenants on the
part of the City to and in f'avor of' the holders of the Refunding Bonds.
that
(a) in the annual budget to be prepared and made in the
1939-1940 and each of the succeeding five fiscal years, there
shall be included a specif'ic ad valorem tax levied upon the
extended and finally equalized valuation of all taxable property
in the City for the Interest and Sinking Fund for Refunding Bonds
which will aggregate annually not less than the amounts shown
in the following schedules:
FISCAL YEARS
AMOUNT OF LEVY
1939-194O
1940-1941
1941-l942
1942-1943
1943-1944
1944-1945
$12.000.00
14,000.00
14.000.00
14,000.00
20,000.00
20.000.00
(b) In the 1945-1946 and succeeding fiscal years in which
any of the Refunding Bonds remain outstanding the City shall, levy
an annual tax specifically allocated to the Interest and Sinking
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Fund for Refunding Bonds in an amount sufficient to promptly
care for necessary interest requirements, and in addition
thereto, an amount for sinking fund purposes sufficient to
produce a minimum of two per centum (2%) of the total amount
of the then outstanding Refunding Bonds.
In determining the
rate of tax necessary for these purposes, the average percentage
of collectibility of taxes during the three years immediately
preceding shall be deemed to be the percentage of collectibility
of taxes for the fiscal year then being levied for.
(c) All taxes levied for payment of principal and interest
on the Refunding Bonds shall constitute special levies for the
particular purposes for which they are imposed.
Such tax levies,
while constituting special levies, shall be collected in cash at
the same time and in the same manner as other taxes which may be
levied by the City.
(5) That at any time there exists in the Interest and Sinking
Fund a balance of $5,000.00 or more over and above the amount necessary to
discharge the next succeeding interest coupon, the City shall disburse such
balance by either the purchase or call of Refunding Bonds.
In the event the option of purchase of Refunding Bonds is used,
it shall be exercised in the following manner:
The City shall designate a date, which shall be not less than
thirty (30) days nor more than forty-five (45) days from the time said date
is designated. at which time it will receive sealed tenders of bonds of the
refunding issue, and act upon such tenders in open session. Upon determining
said date, the City shall notify the Fiscal Agent and any bondholders so
requesting notice, of the time and place of receiving such tenders.
Notice shall also be published once, at least thirty (30) days before said time,
in at least two (2) newspapers having general ciroulation in the locality
wherein they are published. one of' which newspapers shall be printed in
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Lake County, Florida. and the other in the City of New York, State of
New York. The entire available fund for retirement of' the bonds shall
be used to purchase bonds offered at the lowest prices: Provided, however,
that if said offers are not satisfactory to the City, the City shall have
the right to reject said offers and thereafter, within ninety (90) days,
re-advertise for offers as hereinabove set forth. If no satisfactory
offers at less than par are received as a result of the second advertising,
the City shall then reject all offers and proceed to call bonds as herein-
below set out. In event the option of call of Refunding Bonds is used,
it shall be exercised in the following manner:
Bonds shall be called on any interest payment date, and shall
be called by lot. Notioe of intention to call shall be filed at the place
of payment of principal and interest at least sixty (60) days prior to call
date. Notice shall also be published in at least two newspapers of
general circulation in the locality wherein they are published, one of which
newspapers shall be printed in Lake County Florida, and the other in the
City of New York, New York, said notice appearing once a week for four
consecutive calendar weeks, the date of first appearance to be at least
sixty (60) days prior to the date fixed for call.
(6) Anticipated collections of delinquent taxes will not be
considered as revenue available for payment of the principal or interest
of the Refunding Bonds in preparing the budget of the City, or in fixing
the tax levy for any fiscal year prior to 1944-1945, and the City will
pay all moneys received by it through the collection of delinquent taxes
to the purpose for which they were levied or are pledged hereby.
(7) That the City shall actively and diligently enforce the
collection of' all taxes and special assessments heretofore and hereafter
levied. and shall require all such taxes to be paid in cash: Provided,
however, that the payment of delinquent taxes for the year 1930 and prior
years, and all presently outstanding special assessment liens, shall be
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payable as follows: 5% in cash and 95% in Delinquent Tax Notes, or coupons,
or evidences of unpaid interest accruals to July 1, 1939, or the equivalent
thereof in cash, if all subsequent taxes have been paid. or are paid
simultaneously.
(8) That, as a part of the refunding program. the City shall
cancel any or all tax levies made for the years 1931 to 1938. inclusive, and
shall levy a special tax covering this period of twelve (12) mills, said
special tax to be levied at the rate of four (4) mills per year for each of
the years 1939, 1940 and 1941; and the proceeds thereof, together with the
proceeds realized from the settlement of delinquent taxes for the years 1930
and prior years, and presently outstanding special assessment liens, shall be
placed in a special fund to be used only for the purchase of Delinquent Tax
Notes.
The City shall, when one hundred ($100.00) dollars is accumulated
in this fund. purchase Delinquent Tax Notes at the price of fifteen per cent.
(15%) of their face value, and shall purchase such notes in the order in which
the same shall have been deposited with the Fiscal Agent: Provided, however,
that as to all Delinquent Tax notes or evidences of accrued interest to
July 1, 1939, deposited \nth the Fiscal Agent prior to July 1, 1939, such
purchase shall be of a pro rata amount from each depositor. No Delinquent
Tax Notes or evidences of accrued interest shall be purchased by the City
except through the Fiscal Agent.
The City shall cancel the Delinquent Tax Notes purchased. and
destroy the same. The Fiscal Agent shall keep on deposit with the City
Clerk a sufficient amount of Delinquent Tax Notes or evidences of accrued
interest to meet the requirements of taxpayers desiring to purchase same
to use in the payment of 1930 and prior taxes and special assessment liens:
Provided the Fiscal Agent has same deposited with it; and where such notes
are sold to taxpayers and by them turned in on the payment of special
assessment liens or taxes, as herein provided, such notes shall be canceled
and destroyed.
6.
Where Delinquent Tax Notes are sold by the City, as provided in
this section, the money received by the City shall be forthwith turned
over to the Fiscal Agent f'or disbursement to the owners of such certificates.
No bond or coupons or Delinquent Tax Note shall be paid by the
City, or by the Fiscal Agent, until the same has been submitted to the
City Attorney for examination as to the legality of such, and approved by
him.
No bond, coupon, note, or other obligation of the City shall
be destroyed until such destruction has been specifically authorized by
the City Council; and such destruction shall be in the presence of the
Council. and a complete description of the instruments destroyed shall
be entered in the minutes.
The new bonds and coupons authorized herein shall be acceptable
by the City in payment of special assessment liens only, and not in payment
of taxes; and when such new bonds and/or coupons are accepted in payment
of assessment liens the same benefits shall accrue to the taxpayer as though
the old bonds and/or coupons had been offered in payment of such assessment
liens; that is, the new bonds and/or coupons shall satisfy an amount of
special assessment liens equal to what would have been settled by the old
bonds.
.(9) The Fiscal Agent shall pay all costs and expenses incident
to securing the consent of the requisite percentage of bonds to enable the
City to put into effect the refunding plan oontemplated hereby, including
the assembling of the bonds for exchange, and including also the cost and
expense of furnishing the legal opinion of nationally recognized bond
counsel as to the legality of the Refunding Bonds. and any other expenses
the Fiscal Agent may incur in the performance of its duties hereunder.
For such services rendered, the City agrees to pay to the Fiscal Agent
a fee equal to two per cent (2%) of the presently outstanding bonds which
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are actually exchanged for the new Refunding Bonds within one year from
the date hereof,- the said two per cent (2%) to be paid in cash as the
same may accrue under the provisions of Section 10 of this agreement.
(10)
The City shall pay the following costs incident to
carrying into effect the provisions of this refunding program, to-wit:
(a) Validating the bonds in a court of competent jurisdiction;
(b) Printing the bonds;
(c) Depositary and exchange fees;
(d) Cost and expense, including the City's attorney's fees,
of proceedings under Chapter IX of the National Bankruptcy
Act as amended.
For the purpose of providing the necessary funds to pay the
foregoing costs and expenses, and to pay the Fiscal Agent's fee of two per
cent (2%) hereinabove mentioned, the cash payment of five per cent (5%) of
the special assessment liens and the 1930 and prior taxes, together with the
sum of five ($5.00) dollars from each one hundred ($lOO.OO) dollars, face
value, of Delinquent Tax Notes, shall be retained by the Fiscal Agent in a
special fund out of the funds received by it from the City for the purpose
of redeeming or purchasing Delinquent Tax Notes,- the other ten ($10.00)
dollars of the total amount received for each one hundred ($lOO.OO) dollar
Delinquent Tax Note to be paid by the Fiscal Agent to the owner of such
Delinquent Tax Note.
As such funds are received by the Fiscal Agent from the City
for the redemption or purchase of said Delinquent Tax Notes, and from time
to time, as such moneys in said special fund shall amount to the sum of'
five hundred ($500.00) dollars, or more, an equal division thereof shall
be made between the City and the Fiscal Agent until the respective amounts
of fees, costs and expenses of the Fiscal Agent and of the City shall be
provided for; and if any funds shall remain after all costs, fees and
expenses of both the City and the Fiscal Agent shall have been paid, such
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funds shall be deposited in and become a part of the sinking fund for the
benefit of the Refunding Bonds to be issued hereunder.
(11) That the Fiscal Agent shall at all times have the
exclusive authority to determine whether or not it is feasible to effectuate
the refunding plan herein set out should it be impossible to secure the
consents thereto of the holders of all the outstanding indebtedness
particularly set forth in Section (1):
Provided. however, that the City
is in no wise obligated to perform under the terms of this agreement unless
the holders of seventy-five percent (75%) of the outstanding bonds herein-
above referred to have consented to the refunding plan herein set out.
(12) That it is understood that if at any time before or after
any or all of the refunding bonds shall have been authorized, or issued,
it shall be deemed advisable or necessary in the opinion of legal counsel
that an Act or Acts of the Legislature of Florida should be enacted covering
this program, or any part thereof. the governing authority of the City will
support and request the enactment of any such law or laws.
(13) That although a period of time, the extent of which
cannot now be foreseen, must elapse before refunding bonds can be issued
and actually exchanged, it is the intention of the refunding plan that
the several provisions thereof shall be carried out starting with the
authorization of the special tax levy for the years 1931-1937 inclusive,
and the budget for the 1939-1940 fiscal year.
Pending the consummation
of the refunding plan, it is the intention of the City to start liquidating
unpaid interest items up to July I. 1939, and to pay to the holders of the
presently outstanding bonds, interest at the rates specified in the plan:
provided such holders will accept these payments in full settlement of,
or in lieu of, the contract rate in the respective interest claims involved.
(14)
That for a period of four years from the date hereof,
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the Fiscal Agent is hereby granted exclusive authority to act for and in
ehalf of the City in all matters in connection with or relating to the
exchange of the presently outstanding bonds for Refunding Bonds: provided
the Fiscal Agent has. within one year from date hereof, obtained the consent
of the holders of seventy-five per cent. (75%) or more of the bonds
proposed to be refunded herein to participate hereunder.
(15) If, on or before.the expiration of the time limit provided
in this contract, it appears that the Fiscal Agent will not be able to secure
the consent of at least seventy-five per cent. (75%) of the holders of the
outstanding bonds to the refunding program, then by mutual consent of the
Fiscal Agent and the City, proper action may be taken in the Federal Court
to avail the City of the relief provided by the Municipal Bankruptcy Law.
In the event such action is taken, the cost of the legal proceedings and
other expenses necessary shall be borne by the City of Clermont, as provided
in Section 10 hereof; but the Fiscal Agent is to cooperate in every way
in helping to adjust the debt, as provided in the refunding program; and
said refunding program shall remain in force and effect until such time
as the Court has either approved the program and the bonds have been
refunded thereunder, or until the program has been finally and definitely
rejected by the Court. The City may also require the taking advantage of
the Municipal Bankruptcy Law, even though more than seventy-five per cent.
(75%) of the indebtedness may have agreed to the plan submitted.
(16) This Agreement is entered into f'or the purpose of
extending for one year that certain Memorandum of Agreement between the
same parties, executed on May 9, 1938,- subject only to the changes herein
made. In said original agreement it was provided that the Refunding Bonds
contemplated thereby should be issued only in the event of a favorable vote
upon the question of their issuance by the people of the City of Clermont,
and it is now understood and agreed that an election was duly held pursuant
10.
to said agreement. and that it resulted favorable to the issuance of said
Refunding Bonds.
It is now understood that no further election will be
required or held.
IN WITNESS WHEREOF, the City has caused this instrument to be
executed in duplicate in its corporate name, under due corporate authority,
and has caused the same to be signed by its Mayor and his signature to be
attested by its City Clerk, with the corporate seal attached; and the
Fiscal Agent has executed this instrument in duplioate, under its hand
and seal,- all as of the day and year first herein written.
City of Clermont, Florida
By (Seal)
Mayor
Attest:
City Clerk
Leedy, Wheeler & Company
By (Seal)
President
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