HomeMy WebLinkAboutReso 2010-1538
RESOLUTION NO. 2010 - J 538
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA AUTHORIZING
THE ISSUANCE OF $15,000,000 CAPITAL IMPROVEMENT
REVENUE BONDS OF THE CITY OF SUNNY ISLES BEACH,
FLORIDA FOR THE PURPOSE OF FINANCING A PORTION
OF THE COSTS OF DEVELOPMENT OF CITY PROPERTY
FOR CITY PARKS; ACCEPTING THE COMMITMENT OF
SUNTRUST BANK (THE "BANK") TO PROVIDE THE
FINANCING; APPROVING AND AUTHORIZING THE
EXECUTION AND DELIVERY OF A LOAN AGREEMENT
WITH THE BANK; AWARDING THE SALE OF THE BONDS
TO THE BANK; PROVIDING FOR SEVERABILITY;
PROVIDING FOR REPEALER; PROVIDING AN
EFFECTIVE DATE.
WHEREAS, on March 18,2010, the City Commission (the "Commission") of the City of
Sunny Isles Beach, Florida (the "City") adopted Ordinance No. 2010-_ (the "Ordinance")
authorizing the issuance of not exceeding $15,000,000 for the purpose of financing a portion ofthe
costs of development of City property for City parks to be located on Collins Avenue and Sunny Isles
Boulevard, financing architectural, engineering, environmental, legal and other planning costs related
thereto, and paying costs of issuance of the Bonds (the "Project"); and
WHEREAS, pursuant to the City Code, the City has solicited proposals for the financing of
the Project; and
WHEREAS, the Commission hereby determines it to be in the best interests of the City to
proceed with a negotiated sale of the Bonds in accordance with the provisions of Section 218.385,
Florida Statutes, and therefore to accept a commitment (the "Commitment") from SunTrust Bank
(the "Bank"), which is attached as an Exhibit "A" to this Resolution, to purchase the Bonds in
accordance with the additional findings set forth herein; and
WHEREAS, the Commission desires to set forth the details of the Bonds and the other
provisions of the financing in a Loan Agreement with the Bank, which shall be in substantially the
form attached as Exhibit "B" to this Resolution (the "Loan Agreement");
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA, AS FOLLOWS:
Section 1. Incorporation of Recitals. The foregoing recitals are hereby ratified and
confirmed as being true and correct and are hereby made a specific part of this Resolution upon
adoption hereof.
Section 2. Authorization of Bonds. In accordance with the provisions ofthe Ordinance,
the Charter of the City, and Chapter 166, Florida Statutes, there is hereby authorized to be issued
Capital Improvement Revenue Bonds (the "Bonds") of the City, in an aggregate principal amount of
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$15,000,000, for the purpose of financing costs of the Project. The Bonds shall be designated "City
of Sunny Isles Beach, Florida Capital Improvement Revenue Bonds, Series 2010". The details ofthe
Bonds and the other provisions of the financing shall be set forth in the Loan Agreement.
Section 3. Approval of Loan Agreement. The Commission hereby approves the form
and content of the Loan Agreement by and between the City and the Bank, presented at this meeting
and attached hereto as Exhibit "B". The Mayor is hereby authorized to execute and deliver the Loan
Agreement on behalf of the City, and the Clerk is authorized to place the City's seal thereon and
attest thereto, in substantially the form presented at this meeting, with such changes, modifications,
deletions and insertions as the Mayor, with the advice of the City Attorney, may deem necessary and
appropriate. Such execution and delivery shall be conclusive evidence of the approval thereof by the
City.
Section 4. Authorization of Officers. The Mayor is hereby authorized to negotiate the
final terms of the Bonds and the Loan Agreement, consistent with the terms of the Commitment, and
to execute the Bonds, the Loan Agreement and related documents, and to do all other things
necessary to accomplish the issuance and sale of the Bonds. The City Clerk is hereby authorized to
attest the Mayor's signature. The City Clerk and the Assistant City Manager--Finance are each
hereby authorized to execute such documents as are necessary to accomplish the issuance and sale of
the Bonds.
Section 5. Security for the Bonds. The Commission hereby authorizes that the Loan
Agreement set forth a covenant to budget and appropriate legally available non-ad valorem revenues
of the City in order to secure the payment of the Bonds.
Section 6. Negotiated Sale of the Bonds. Based upon the uncertainty of the interest rate
environment if sale ofthe Bonds is delayed, the City hereby determines the necessity for a negotiated
sale of the Bonds. Prior to the final award of the Bonds to the Bank, the City will require that it be
provided all applicable disclosure information required by Section 218.385, Florida Statutes. The
negotiated sale of the Bonds to the Bank is hereby approved at a purchase price of par.
Section 7. Severability. The provisions of this Resolution are declared to be severable
and if any section, sentence, clause or phrase of this Resolution shall for any reason be held to be
invalid or unconstitutional, such decision shall not affect the validity of the remaining sections,
sentences, clause, and phrases of this Resolution but they shall remain in effect, it being the
legislative intent that this Resolution shall stand notwithstanding the invalidity of any part.
Section 8. Repealer. All resolutions or part of resolutions in conflict herewith be and the
same are hereby repealed.
Section 9.
adoption.
Effective Date. This Resolution shall take effect immediately upon its
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PASSED AND ADOPTED this 18th day of March, 2010.
ATTEST:
~~~
Jane A. Hines, CMC, City Clerk
Moved by: ~~ Gco~
Second by: VlCsLM~ -w\td-<t:.e
VOTE AS FOLLOWS: S-b
Mayor Edelcup
Vice Mayor Thaler
Commissioner Brezin
Commissioner Goodman
Commissioner Scholl
~yes
~yes
( ~ yes
(J() yes
cD yes
L)no
L)no
L)no
L)no
L)no
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EXHIBIT" A"
Commitment Letter
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A-I
Sun Trust Bank, South Florida
Mail Code FL-Miami-1042
777 Brickell Avenue, 4h Floor
Miami, FL 33131
Tel 305-579-7014
Fax 305-579-7133
Delle Joseph
First Vice President
SUNTRUST
February 23, 2010
Mr. Doug Haag
Assistant City Manager
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Fl 33160
Re: Proposal to City of Sunny Isles Beach- Up to $15,000,000 Tax Exempt Loan.
Dear Doug:
SunTrust Banks, Inc. is pleased to present this proposal to the City of Sunny Isles Beach
("Borrower", "City") for a Tax Exempt Term loan (the "Loan") in the amount of up to Fifteen
Million dollars ($15,000,000).
Sun Trust appreciates the opportunity to provide the City of Sunny Isles Beach with this Term
Loan proposal and views this as part of our genuine interest to work with and support the City of
Sunny Isles Beach.
Although the following provisions, terms and conditions are intended to be comprehensive, they
are not necessarily inclusive of all the anticipated terms that will be applicable to the credit. All of
such terms will be set forth in the final, definitive loan documents, and all such terms must be
acceptable to the Bank and its counsel.
Borrower:
City of Sunny Isles Beach, Florida
Amount:
Up to $15,000,000
Maturity:
Fifteen (15) years from the closing date.
Purpose:
The Loan will be used to develop existing property owned by the City of
Sunny Isles Beach on Collins Avenue and Sunny Isles Boulevard into parks
in accordance with the City's Comprehensive Plan.
Terms:
Principal and Interest payments will be due on a quarterly basis starting
October 1, 2010 and every January 1 st, April 1 s" and July 1 st thereafter. Any
remaining principal and any accrued interest due at maturity.
Security:
It is expected that the loan will only be required to be secured by a "Covenant
to Budget and Appropriate" from the City's non ad valorem revenues.
Interest Rate:
Tax~exemlJt Bank Qualified Fixed Rate (15 years Term - 15 years
Amortization)
Fixed Rate as of February 23,2010 is 4.20% for 15 years based on a 15-
year amortization. The associated estimated annual principal and interest
payment is: $1,352,930. Interest rate will be computed on a 360-day
calendar year based on the actual number of days elapsed. This fixed rate
assumes that the rate Is locked for the next 30 days to allow the City to
close on this Loan.
Prepayment:
The above options assume that the loan will carry a standard "make whole"
prepayment penalty provision language (see attached Addendum).
Closing Fee:
A flat fee of $7,500 will apply for the Tax Exempt loan for the drafting of all
legal documentation relating to this loan by Bank/Bond Counsel plus
rendering of legal opinion and $2,500 Bank Loan Fee.
Covenants and Conditions
A) All matters relating to this loan, including all instruments and documents required, are
subject to the Bank's policies and procedures in effect, applicable governmental regulations
and/or statutes, and approval by the Bank and the Bank's Counsel.
B) Bank's legal counsel will prepare the legal documents for this transaction. Bank's Counsel
shall submit a written opinion, in form and substance acceptable to SunTrust Bank that all
documents are valid, binding and enforceable in accordance with their terms, that execution
and delivery of said documents has been duly authorized
C) Borrower shall continue to maintain similar to existing level of depository banking
relationship with the Bank and Loan payments will be settled via auto debit.
D) Borrower shall submit annual audited statements within 210 days of fiscal year end, together
with an annual budget within 30 days of adoption, together with any other information the
Bank may reasonably request.
Anti-Dilution Test shall be set at 1.50x based on the requirement that General Fund Non Ad-
Valorem revenues less any portion of essential governmental services that is not covered
by ad-valorem revenues, shall provide a minimum annual debt service coverage of 1.50
times on Borrower's debt secured by Non-Ad Valorem revenues. Essential services are
defined as general governmental and public safety expenses.
Borrower maximum annual debt service backed by a Covenant to Budget and Appropriate
shall not exceed 20% of Governmental Fund revenues.
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E) The tax-exempt interest rates quoted herein take into consideration a corporate tax rate of
35%. In the event of a change in the maximum corporate tax rate, the Bank shall have the
right to adjust the interest rate in order to maintain the same after tax yield.
F) The Bank shall have the right to adjust the tax-exempt interest rate in order to maintain the
same after tax yield if any amendments to existing law are enacted which would adversely
affect the Bank's after tax yield including any "determination oftaxability" as will be defined in
the loan documentation.
G) The Borrower shall comply with and agree to such other covenants, terms, and conditions
that may be reasonably required by the Bank and its counsel and are customary in tax-
exempt financings of this nature. These covenants would include, but are not to be limited
to, covenants regarding compliance with laws and regulation, remedies in the event of
default and bond counsel's opinion regarding the tax exempt and "Bank qualified" nature of
the facility.
After you have had a chance to review the following information, please contact Delle Joseph at
(305) 579-7014 with any questions. SunTrust greatly appreciates the opportunity to provide this
financing proposal to the City of Sunny Isles Beach
Sincerely,
t1,ust BaV
Delle~
First Vice President
Acceptance of Proposal:
BORROWER ACCEPTS THE PROPOSAL AS RENDERED:
Date
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jll~ SUNTRusr
ADDENDUM
Bankts Standard Prepayment Lanl!ual!e:
Upon two Business Days' prior written notice to SunTrllst, the BOlTower may prepay amounts owing
under the Note at any time and from time to time, Such prepayment notice shall speciry the amount of the
prepayment which is to be applied. In the event of prepayment, the Borrower may be required to pay
SunTrust an additional fee (8 prepayment charge) determined in the manner provided below, to
compensate SunTrust for all losses, costs and expenses incurred in connection with such prepayment.
The fee shall be equal to the present value of the difference between:
(1) the amount that would have been realized by SunTrust on the prepaid amount for the remaining term
of the loan at the Federal Reserve B.IS Statistical Release rate fOl' fixed-rate payers in interest "ate swaps
for a tenn cOlTesponding to the term of the Note, interpolated to the nearest month, if necessary, that was
in effect three Business Days prior to the origination date of the Note
and
(2) the amount that would be realized by SUIlTJ'ust by reinvesting such prepaid funds for the remllining
term of the loan at the Federal Reserve H.IS Statistical Release rate for fixed-rate payers in interest rate
swaps, intel'polated to the nearest month, that was in effect three Business Days prior to the loan
repayment date; both discounted at the same interest rate utilized in determining the applicable amount ill
(2).
Should the present value have no value or a negative vahle, the Borrower may repay with no additional
fee. Should the Federal Reserve no longer release rates for fixed-rate payers in interest rate swaps,
SunTrust may substitute the Federal Reserve H.15 Statistical Release with another similar index.
SunTrust shall provide the Borrower with a written statement explaining the calculation of the premium
due, which stlltement shall, in absence of manifest error, be conctusive and binding.
EXHIBIT "B"
Form of Loan Agreement
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B-1
EXHIBIT "B"
LOAN AGREEMENT
This LOAN AGREEMENT (this "Agreement") is made and entered into as of March _,
2010 and is by and between the City of Sunny Isles Beach (the "City") and SunTrust Bank, a
Georgia banking corporation, and its successors and assigns as holder of the hereinafter defined
Bonds (the "Bank");
WHEREAS, the City Commission of the City did, on March 18, 2010, adopt an
Ordinance and a Resolution (collectively, the "Bond Ordinance") authorizing bonds in the
principal amount of $15,000,000 and accepting the commitment to purchase the bonds from the
Bank for the purpose of financing a portion of the costs of development of City property for City
parks to be located on Collins A venue and Sunny Isles Boulevard, financing architectural,
engineering, environmental, legal and other planning costs related thereto, and paying costs of
issuance of the bonds (the "Project"); and
WHEREAS, the City hereby determines that it is desirable and in the best interest of the
City to enter into this Agreement whereby the City will borrow funds from the Bank to be used
for the Project; and
WHEREAS, the loan evidenced by this Agreement, in an aggregate principal amount of
$15,000,000 (the "Bonds"), will be tax-exempt and will finance the Project; and
WHEREAS, the obligation of the City to repay the Bonds to the Bank shall be evidenced
by the delivery of one Bond, in the amount of $15,000,000, maturing in fifteen (15) years; and
WHEREAS, the Bonds shall be issued pursuant to the terms and provisions of the Bond
Ordinance and this Agreement; and
WHEREAS, the execution and delivery of this Agreement have been duly authorized by
the Bond Ordinance.
NOW THEREFORE, in consideration of the sum of $10.00, the mutual promises and
covenants contained in this Agreement, and for other good and valuable consideration, the
receipt and legal sufficiency of which is acknowledged by both parties, the parties agree as
follows.
ARTICLE I
DEFINITION OF TERMS
Section 1.1 Definitions. The words and terms used in this Agreement shall have the
meanings as set forth in the Bond Ordinance and in the recitals above, unless otherwise defined
herein. Unless the context shall otherwise require, the following words and terms as used in this
Agreement shall have the following meanings:
"Act" means Part II of Chapter 166, Florida Statutes, as amended, the Charter of the City,
and other applicable provisions of law.
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"Agreement" means this Loan Agreement and any and all modifications, alterations,
amendments and supplements hereto made in accordance with the provisions hereof.
"Annual Debt Service Requirement" means for a given Fiscal Year the amount required
to pay the principal and interest coming due on the Bonds during that Fiscal Year.
"Bond Counsel" means counsel experienced in matters relating to the validity of, and the
exclusion from gross income for federal income tax purposes of interest on, obligations of states
and their political subdivisions.
"Bond Payment Date" means each January 1, April 1, July 1 and October 1 of each year,
commencing October 1,2010.
"Bonds" means the $15,000,000 City of Sunny Isles Beach, Florida Capital Improvement
Revenue Bonds, Series 2010, issued pursuant to this Agreement.
"Business Day" means any day which is not a Saturday, Sunday or legal holiday in
Miami, Florida.
"City Manager" means the City Manager of the City.
"Clerk" means the Clerk or any Deputy Clerk of the City.
"Code" means the Internal Revenue Code of 1986, as amended, including the applicable
regulations of the Department of the Treasury (including applicable final regulations, temporary
regulations and proposed regulations), the applicable rulings of the Internal Revenue Service
(including published Revenue Rulings and private letter rulings) and applicable court decisions.
"Dated Date" means the date of issuance of the Bonds.
"Event of Default" shall mean an event of default specified III Article VIII of this
Agreement.
"Fiscal Year" means the period commencing on October 1 of each year and ending on the
succeeding September 30, or such other consecutive 12-month period as may be hereafter
designated as the fiscal year of the City pursuant to general law.
"Governing Body" means the City Commission of the City, or its successor in function.
"Holder" or "Holders" means the registered owner(s) (or their authorized representatives)
of the Bonds from time to time, initially the Bank.
"Loan Documents" means this Agreement, the Bonds, the Bond Ordinance and all other
documents, agreements, certificates, schedules, notes, statements, and opinions, however
described, referenced herein or executed or delivered pursuant hereto or in connection with or
arising with the Loan or the transaction contemplated by this Agreement.
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"Mayor" means the Mayor of the City and such other person as may be authorized to act
on his or her behalf.
"Non-Ad Valorem Revenues" means all revenues of the City derived from any source
other than ad valorem taxation on real or personal property and which are legally available to
make the payments required under this Agreement; but only after the payment of services and
programs which are for essential public purposes affecting the health, welfare and safety of the
inhabitants of the City or which are legally mandated by applicable law.
"Person" means natural persons, firms, trusts, estates, associations, corporations,
partnerships and public bodies.
"State" means the State of Florida.
"Supplemental Ordinance" means any ordinance or resolution of the City amending or
supplementing the Bond Ordinance in accordance with the terms and provisions thereof.
Section 1.2 Interpretation. Unless the context clearly requires otherwise, words of
masculine gender shall be construed to include correlative words of the feminine and neuter
genders and vice versa, and words of the singular number shall be construed to include
correlative words of the plural number and vice versa. This Agreement and all the terms and
provisions hereof shall be construed to effectuate the purposes set forth herein and to sustain the
validity hereof.
Section 1.3 Titles and Headine:s. The titles and headings of the articles and sections
of this Agreement have been inserted for convenience of reference only and are not to be
considered a part hereof, shall not in any way modify or restrict any of the terms and provisions
hereof, and shall not be considered or given any effect in construing this Agreement or any
provision hereof or in ascertaining intent, if any question of intent should arise.
ARTICLE II
REPRESENTATIONS OF CITY
The City represents and warrants to the Bank that:
Section 2.1 Powers of City. The City is duly organized and validly existing as a
municipal corporation under the laws of the State. The City has the power to borrow the amount
provided for in this Agreement, to execute and deliver the Loan Documents, to secure the Bonds
in the manner contemplated hereby, and to perform and observe all the terms and conditions of
the Bonds and this Agreement on its part to be performed and observed. The City may lawfully
issue the Bonds in order to obtain funds to finance the Project.
Section 2.2 Authorization of Loan. The City has, had or will have, as the case may
be, full legal right, power, and authority to adopt the Bond Ordinance and to execute and deliver
this Agreement, to issue, sell, and deliver the Bonds to the Bank, and to carry out and
consummate all other transactions contemplated hereby and by the Loan Documents, and the
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City has complied and will comply with all provisions of applicable law in all material matters
relating to such transactions. The City, by the Bond Ordinance, has duly authorized the
borrowing of the amount provided for in this Agreement, the execution and delivery of this
Agreement, and the making and delivery of the Bonds to the Bank, and to that end the City
warrants that it will take all action and will do all things which it is authorized by law to take and
to do in order to fulfill all covenants on its part to be performed and to provide for and to assure
payment of the Bonds. The City has duly adopted the Bond Ordinance and authorized the
execution, delivery, and performance of the Bonds and the Agreement and the taking of any and
all other such action as may be required on the part of the City to carry out, give effect to and
consummate the transactions contemplated by the Loan Documents. The Bonds have been duly
authorized, executed, issued and delivered to the Bank and constitute legal, valid and binding
obligations of the City enforceable in accordance with their terms and the terms of the Bond
Ordinance, and are entitled to the benefits and security of the Bond Ordinance and this
Agreement. All approvals, consents, and orders of and filings with any governmental authority or
agency which would constitute a condition precedent to the issuance of the Bonds or the
execution and delivery of or the performance by the City of its obligations under the Loan
Documents have been obtained or made and any consents, approvals, and orders to be received
or filings so made are in full force and effect.
Section 2.3 A2reements. The City is not in default in any material respect under any
agreement or other instrument to which it is a party or by which it may be bound. The making
and performing by the City of this Agreement will not violate any provision of the Act, any
ordinance or resolution of the City, or any regulation, order or decree of any court, and will not
result in a breach of any of the terms of any agreement or instrument to which the City is a party
or by which the City is bound. The Loan Documents constitute legal, valid and binding
obligations of the City enforceable in accordance with their respective terms.
Section 2.4 Liti2ation. Etc. There are no actions or proceedings pending against the
City or affecting the City or, to the knowledge of the City, threatened, which, either in any case
or in the aggregate, might result in any material adverse change in the financial condition of the
City, or which question the validity of this Agreement, the Bonds or any of the other Loan
Documents or of any action taken or to be taken in connection with the transactions
contemplated hereby or thereby.
Section 2.5 Financial Information. The financial information regarding the City
furnished to the Bank by the City in connection with the Loan is complete and accurate, and
there has been no material and adverse change in the financial condition of the City from that
presented in such information.
ARTICLE III
COVENANTS OF THE CITY
Section 3.1 Affirmative Covenants. The City covenants, for so long as any of the
principal amount of or interest on the Bonds is outstanding and unpaid or any duty or obligation
of the City hereunder or under any of the other Loan Documents remains unpaid or unperformed,
as follows:
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(a) Use of Proceeds. The City covenants that the proceeds from the Bonds
will be used only to finance the Project and to pay closing costs. The City represents that, as of
the date of issuance of the Bonds, there are no other bonds or obligations of the City secured by a
covenant to budget and appropriate from Non-Ad Valorem Revenues, other than (i) the
$20,000,000 City of Sunny Isles Beach, Florida Promissory Note, dated June 8, 2009, (ii) a loan
in the original principal amount of $10,320,000 made on November 30, 2001 from a portion of
the proceeds of the Florida Municipal Loan Council Revenue Bonds, Series 2001A and (iii) a
loan in the original principal amount of$17,945,000 made on November 22,2002 from a portion
of the proceeds of the Florida Municipal Loan Council Revenue Bonds, Series 2002C
(collectively, (i), (ii) and (iii) are hereinafter referred to as the "Prior Debt").
(b) Notice of Defaults. The City shall within fifteen (15) days after it
acquires knowledge thereof, notify the Bank in writing upon the happening, occurrence, or
existence of any Event of Default, and any event or condition which with the passage of time or
giving of notice, or both, would constitute an Event of Default, and shall provide the Bank with
such written notice, a detailed statement by a responsible officer of the City of all relevant facts
and the action being taken or proposed to be taken by the City with respect thereto.
(c) Records. The City agrees that any and all records of the City shall be
open to inspection by the Bank or its representatives at all reasonable times at the offices of the
City.
(d) Maintain Existence. The City shall do all things lawfully within its
power to maintain its existence as a municipal corporation of the State, and shall not voluntarily
dissolve.
(e) Notice of Liabilities. The City shall promptly inform the Bank of any
actual or potential contingent liabilities or pending or threatened litigation of any amount that
could reasonably be expected to have a material and adverse effect upon the financial condition
of the City.
(1) Insurance. The City shall maintain such liability, casualty and other
insurance as is reasonable and prudent for similarly situated municipal corporations of the State
and shall upon the request of the Bank, provide evidence of such coverage to the Bank.
(g) Comply with Laws. The City is in compliance with and shall comply
with all applicable federal, state and local laws and regulatory requirements.
(h) Taxes. In the event the Bonds, this Agreement or any other Loan
Document should be subject to the excise tax on documents or the intangible personal property
tax, or any similar tax, of the State of Florida, the City shall pay such taxes or reimburse the
Bank for any such taxes paid by it.
(i) Investments. The City shall invest only III obligations permitted by
Section 218.345, Florida Statutes.
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G) Maintenance of Account with Bank. The City agrees that so long as the
Bonds are outstanding, it will maintain a depository account with the Bank with an amount on
deposit therein similar to that existing with the Bank on the date hereof.
Section 3.2 Bank Fees and Expenses. The City hereby agrees to pay a Bank loan fee
in the amount of $2,500 and the fees of counsel to the Bank in connection with the issuance of
the Bonds in the amount of $7,500 plus such counsel's reasonable out-of-pocket expenses not to
exceed $350, said amounts to be due and payable upon the issuance of the Bonds.
Section 3.3 Re2istration and Exchan2e of Bonds; Persons Treated as Owners. So
long as the Bonds shall remain unpaid, the City will keep books for the registration and transfer
of the Bonds. The Bonds shall be transferable only upon such registration books. The City will
transfer the registration of Bonds upon written request of the Bank specifying the name, address
and taxpayer identification number of the transferee.
The Person in whose name the Bonds shall be registered shall be deemed and regarded as
the absolute owner thereof for all purposes, and payment of principal and interest on the Bonds
shall be made only to or upon the written order of such Person. All such payments shall be valid
and effectual to satisfy and discharge the liability upon the Bonds to the extent of the sum or
sums so paid.
Section 3.4 Payment of Principal and Interest. The City promises that it will
promptly pay the principal of and interest on the Bonds at the place, on the dates and in the
manner provided therein according to the true intent and meaning hereof and thereof, provided
that the principal of and interest on the Bonds is secured solely as provided in Section 3.5 hereof,
and nothing in the Bonds or in the Ordinance shall be construed as pledging any funds or assets
of the City to such payment or authorizing such payment to be made from any other source. The
Bonds shall not be or constitute a general obligation or indebtedness of the City within the
meaning of the Constitution of Florida, but shall be payable solely from and secured in the
manner and to the extent provided in Section 3.5. No Holder shall ever have the right to compel
the exercise of the ad valorem taxing power of the City or taxation in any form on any real or
personal property to pay such Bonds or the interest thereon, nor shall any Holder be entitled to
payment of such principal and interest from any other funds of the City other than the Non-Ad
Valorem Revenues, all in the manner and to the extent herein provided.
Section 3.5 Covenant to Bud2et and Appropriate. The City hereby covenants and
agrees to appropriate in its annual budget, by amendment, if necessary, from Non-Ad Valorem
Revenues lawfully available in each Fiscal Year, amounts sufficient to pay the principal and
interest due on the Bonds in accordance with their terms during such Fiscal Year. Such covenant
and agreement on the part of the City to budget and appropriate 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 been budgeted, appropriated and actually paid. Notwithstanding
the foregoing covenant of the City, the City does not covenant to maintain any services or
programs, now provided or maintained by the City, which generate Non-Ad Valorem Revenues.
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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 from pledging in the future its Non-Ad
Valorem Revenues, nor does it require the City to levy and collect any particular Non-Ad
Valorem Revenues, nor does it give the Bond Holders a prior claim on the Non-Ad Valorem
Revenues as opposed to claims of general creditors of the City. Such covenant to appropriate
Non-Ad Valorem Revenue is subject in all respects to the payment of obligations secured by a
pledge of such Non-Ad Valorem Revenues heretofore or hereafter entered into (including the
payment of debt service on bonds and other debt instruments). However, the covenant to budget
and appropriate in its general annual budget for the purposes and in the manner stated herein
shall have the effect of making available in the manner described herein Non-Ad Valorem
Revenues and placing on the City a positive duty to appropriate and budget, by amendment, if
necessary, amounts sufficient to meet its obligations under this Agreement, subject, however, in
all respects to the terms of this Agreement; and subject, further, to the payment of services and
programs which are for essential public purposes affecting the health, welfare and safety of the
inhabitants of the City or which are legally mandated by applicable law.
Section 3.6 Prepayment. The City shall be entitled to prepay the Bonds prior to
maturity in whole or in part at any time at a price as set forth in the form of Bond attached hereto
as Exhibit "A", plus accrued interest to the date of prepayment, upon written notice to the Holder
given by the City at least two (2) Business Days prior to the date fixed for prepayment.
Section 3.7 Business Days. In any case where the due date of interest on or principal
of the Bonds 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 Bank.
Section 3.8 Officers and Employees of the City Exempt from Personal Liability.
No recourse under or upon any obligation, covenant or agreement of this Agreement or the
Bonds or for any claim based thereon or otherwise in respect thereof, shall be had against any
Commissioner of the City, or any officer, agent or employee, as such, of the City past, present or
future, it being expressly understood (a) that the obligation ofthe City under this Agreement and
the Bonds is solely a corporate one, (b) that no personal liability whatsoever shall attach to, or is
or shall be incurred by, the City Commission, or the officers, agents, or employees, as such, of
the City, or any of them, under or by reason of the obligations, covenants or agreements
contained in this Loan Agreement or implied therefrom, and (c) that any and all such personal
liability of, and any and all such rights and claims against, every such Commissioner of the City,
and every officer, agent, or employee, as such, of the City under or by reason of the obligations,
covenants or agreements contained in this Loan Agreement, or implied therefrom, are waived
and released as a condition of, and as a consideration for, the execution of this Loan Agreement
and the issuance of the Bonds on the part of the City.
Section 3.9 Bonds Mutilated. Destroyed. Stolen or Lost. In case any Bond shall
become mutilated, or be destroyed, stolen or lost, the City shall issue and deliver a new Bond of
like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and in substitution for
such mutilated Bond, or in lieu of and in substitution for the Bond destroyed, stolen or lost and
upon the Holder furnishing the City proof of ownership thereof and indemnity reasonably
satisfactory to the City and complying with such other reasonable regulations and conditions as
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7
the City may prescribe and paying such expenses as the City may InCUr. The Bond so
surrendered shall be canceled.
Section 3.10 Section 265 Desie:nation of Bonds. The reasonably anticipated amount
of tax-exempt obligations (other than obligations described in clause (ii) of Section 265(b )(3)(C)
of the Code) which have been or will be issued by the City during 2010 does not exceed
$30,000,000. There are no entities which are subordinate to or which issue obligations on behalf
of the City. The City hereby designates the Bonds as "qualified tax-exempt obligations" for
purposes of Section 265(b)(3)(B)(i) of the Code. The City hereby covenants and agrees not to
take any action or to fail to take any action if such action or failure would cause the Bonds to no
longer be "qualified tax-exempt obligations."
Section 3.11 Tax Representations. Warranties and Covenants of the City.
Notwithstanding anything herein to the contrary, the City hereby covenants and represents that it
has taken and caused to be taken and shall make and take and cause to be made and taken all
actions that may be required of it for the interest on the Bonds to be and remain excluded from
the gross income of the Holder for federal income tax purposes, and that to the best of its
knowledge it has not taken or permitted to be taken on its behalf, and covenants that to the best
of its ability and within its control, it shall not make or take, or permit to be made or taken on its
behalf, any action which, if made or taken, would adversely affect such exclusion under the
provisions of the Code.
The City acknowledges that the continued exclusion of interest on the Bonds from gross
income for federal income tax purposes depends, in part, upon compliance with the arbitrage
limitations imposed by Sections 1 03(b )(2) and 148 of the Code. The City hereby acknowledges
responsibility to take all reasonable actions necessary to comply with these requirements. The
City hereby agrees and covenants that it shall not permit at any time or times any of the proceeds
of the Bonds or other funds of the City to be intentionally used, directly or indirectly, to acquire
or to replace funds which were used directly or indirectly to acquire any higher yielding
investments (as defined in Section 148 of the Code), the acquisition of which would cause the
Bonds to be an arbitrage bond for purposes of Sections 1 03(b )(2) and 148 of the Code. The City
further agrees and covenants that it shall do and perform all acts and things necessary in order to
assure that the requirements of Sections 1 03(b )(2) and 148 of the Code are met.
Specifically, without intending to limit in any way the generality of the foregoing, the
City covenants and agrees:
(a) to pay to the United States of America at the times required pursuant to
Section 148(f) of the Code, the excess of the amount earned on all non-purpose investments (as
defined in Section 148(f)(6) of the Code) (other than investments attributed to an excess
described in this sentence) over the amount which would have been earned if such non-purpose
investments were invested at a rate equal to the yield on the Bonds, plus any income attributable
to such excess (the "Rebate Amount");
(b) to maintain and retain all records pertaining to and to be responsible for
making or causing to be made all determinations and calculations of the Rebate Amount and
required payments of the Rebate Amount as shall be necessary to comply with the Code; and
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(c) to comply with all representations and restrictions contained in any Tax
Certificate executed by the City in connection with the Bonds.
The City understands that the foregoing covenants impose continuing obligations on it to
comply with the requirements of Section 103 and Part IV of Subchapter B of Chapter 1 of the
Code so long as such requirements are applicable.
Section 3.12 Additional Tax Covenants of the City. For so long as the Bonds
remains outstanding, the City hereby covenants as follows:
(a) It will comply with, and timely make or cause to be made all filings
required by, all effective rules, rulings or regulations promulgated by the Department of the
Treasury or the Internal Revenue Service;
(b) It will not use, invest, direct or permit the investment of the proceeds of
the Bonds or any investment earnings thereon in a manner that will result in such Bonds
becoming a "private activity bond" within the meaning of Sections 141 and 145 of the Code;
( c) It will not use or permit to be used more than ten percent (10%) of the
proceeds of the Bonds (including any amounts used to pay costs associated with issuing such
Bonds), including all investment income earned on such proceeds directly or indirectly, in any
trade or business carried on by any person who is not the City or a state or political subdivision
or instrumentality thereof as those terms are used in Section 103 of ,the Code (an "Exempt
Person");
(d) It will not use or permit the use of any portion of the proceeds of the
Bonds, including all investment income earned on such proceeds, directly or indirectly, to make
or finance loans to persons who are not Exempt Persons;
(e) It has not entered into, and will not enter into, any arrangement with any
person or organization (other than an Exempt Person) which provides for such person or
organization to manage, operate, or provide services with respect to more than 10% of the
project financed with the proceeds of the Bonds (a "Service Contract"), unless the guidelines set
forth in Revenue Procedure 97-13 (or the guidelines set forth in Revenue Procedure 93-19, to the
extent applicable, or any new, revised or additional guidelines applicable to Service Contracts)
(the "Guidelines"), are satisfied, except to the extent it obtains a private letter ruling from the
Internal Revenue Service or an opinion of nationally recognized Bond Counsel which allows for
a variation from the Guidelines;
(I) It will not cause the Bonds to be treated as "federally guaranteed" for
purposes of Section 149 of the Code, as may be modified in any applicable rules, rulings,
policies, procedures, regulations or other official statements promulgated or proposed by the
Department of the Treasury or the Internal Revenue Service with respect to "federally
guaranteed" obligations described in Section 149 of the Code. For purposes of this paragraph,
the Bonds shall be treated as "federally guaranteed" if (i) all or any portion of the principal or
interest is or will be guaranteed directly or indirectly by the United States of America or any
agency or instrumentality thereof, or (ii) 5% or more of the proceeds of the Bonds will be (A)
used in making loans the payment of principal or interest with respect to which is to be
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9
guaranteed in whole or in part by the United States of America or any agency or instrumentality
thereof, or (B) invested directly or indirectly in federally insured deposits or accounts, and (iii)
such guarantee is not described in Section 149(b)(3) of the Code; and
(g) It will comply with the information reporting requirements of Section
149(e)(2) of the Code.
The terms "debt service," "gross proceeds," "net proceeds," "proceeds," and "yield" have
the meanings assigned to them for purposes of Section 148 of the Code.
ARTICLE IV
CONDITIONS OF LENDING
Section 4.1 Conditions of Lending. The obligations of the Bank to lend hereunder
are subject to the following conditions precedent:
(a) No Default. On the date hereof the City shall be in compliance with all
the terms and provisions set forth in the Loan Documents on its part to be observed or
performed, and no Event of Default nor any event that, upon notice or lapse of time or both,
would constitute such an Event of Default, shall have occurred and be continuing at such time.
(b) Supporting Documents. On or prior to the date hereof, the Bank shall
have received the following supporting documents, all of which shall be satisfactory in form and
substance to the Bank (such satisfaction to be evidenced by the purchase of the Bonds by the
Bank):
(i) The opinion of the City Attorney or special counsel to the City
regarding the due authorization, execution, delivery, validity and enforceability of this
Agreement and the Bonds, the City's power to incur the debt evidenced by the Bonds and
the due adoption of the Ordinance;
(ii) The opinion of Bond Counsel to the effect that, (A) the interest on
the Bonds is excluded from gross income for federal income tax purposes, (B) the
interest on the Bonds is not an item of tax preference under Section 57 of the Code, (C)
the Bonds are qualified tax -exempt obligations under Section 265(b )(3) of the Code and
(D) the Bonds and the income thereon is exempt from the State excise tax on documents;
and
(iii) Such additional supporting documents as the Bank may reasonably
request.
ARTICLE V
THE LOAN; CITY'S OBLIGATION; DESCRIPTION AND PAYMENT TERMS
Section 5.1 The Loan. The Bank hereby agrees to loan to the City the amount of
$15,000,000 to be evidenced by the Bonds, to provide funds to finance the Project and to pay
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10
closing costs upon the terms and conditions set forth in the Bond Ordinance and in this
Agreement. The City agrees to repay the principal amount borrowed plus interest thereon, upon
the terms and conditions set forth in the Loan Documents.
Section 5.2 Description and Payment Terms of the Bonds. To evidence the Loan,
the City shall issue and deliver to the Bank the Bonds in the form attached hereto as Exhibit "A".
ARTICLE VI
CREATION AND USE OF FUNDS AND ACCOUNTS
Section 6.1 Bond Fund. There is hereby created a fund, entitled "City of Sunny Isles
Beach, Florida, Capital Improvement Revenue Bonds, Series 2010 Bond Fund" (the "Bond
Fund"). There shall be deposited into the Bond Fund on each Bond Payment Date sufficient
amounts of Non-Ad Valorem Revenues as specified in Section 3.5 hereof which, together with
the amounts already on deposit therein, will enable the City to pay the principal of and interest
on the Bonds on each Bond Payment Date. Moneys in the Bond Fund shall be applied on each
Bond Payment Date to the payment of principal of and interest on the Bonds coming due on each
such date.
Section 6.2 Funds. Each of the funds and accounts herein established and created
shall constitute trust funds for the purposes provided herein for such funds and accounts
respectively. The money in such funds and accounts shall be continuously secured in the same
manner as deposits of City funds are authorized to be secured by the laws of the State of Florida.
The designation and establishment of the funds and accounts in and by this Agreement
shall not be construed to require the establishment of any completely independent, self-balancing
funds, 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 the
purposes herein provided and to establish certain priorities for application of such revenues and
assets.
Section 6.3 Rebate Fund and Rebate Covenants. There is hereby created and
established a fund to be held by the City, designated the "City of Sunny Isles Beach Capital
Improvement Revenue Bonds, Series 2010 Rebate Fund" (the "Rebate Fund"). The Rebate Fund
shall be held by the City separate and apart from all other funds and accounts held by the City
under this Agreement and from all other moneys ofthe City.
Notwithstanding anything in this Agreement to the contrary, the City shall transfer to the
Rebate Fund the amounts required to be transferred in order to comply with the Tax Certificate
or the Rebate Covenants, if any, attached as an Exhibit to the Tax Certificate to be delivered by
the City on the date of delivery of the Bonds (the "Rebate Covenants"), when such amounts are
so required to be transferred. The City Manager shall make or cause to be made payments from
the Rebate Fund of amounts required to be deposited therein to the United States of America in
the amounts and at the times required by the Rebate Covenants. The City covenants for the
benefit of the Holders that it will comply with the Rebate Covenants. The Rebate Fund, together
with all moneys and securities from time to time held therein and all investment earnings derived
therefrom, shall be excluded from the pledge and lien of this Agreement. The City shall not be
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11
required to comply with the requirements of this Section 6.3 in the event that the City obtains
and opinion of nationally recognized bond counsel that (i) such compliance is not required in
order to maintain the federal income tax exemption of interest on the Bonds and/or (ii)
compliance with some other requirement is necessary to maintain the federal income tax
exemption of interest on the Bonds.
ARTICLE VII
SPECIAL COVENANTS
Section 7.1 Financial Statements. The City shall, upon receipt by the City or within
two hundred and ten (210) days of each Fiscal Year end, whichever is sooner, provide the Holder
with a printed copy of its Comprehensive Annual Financial Report, its current year operating
budget and its capital improvement plan, and a certificate of its City Manager in form and
substance satisfactory to the Holder evidencing compliance with the covenant set forth in Section
7.2 below. The City shall also provide to the Holder any other financial information reasonably
requested by such Holder.
Section 7.2 Covera2;e Requirement. The City covenants and agrees that it will at all
times maintain a coverage ratio such that Available Revenues of the City during the prior Fiscal
Year is equal to at least 150% of Maximum Annual Debt Service. For purposes of this
paragraph and Section 7.3,
(a) "Maximum Annual Debt Service" shall mean the maximum amount of
principal and interest required in the then current or any future fiscal year to pay all Debt
Obligations;
(b) "Debt Obligations" shall mean debt service on debt obligations of the
City, including the Bonds and the Prior Debt, which are secured by or payable from general or
specific Non-Ad Valorem Revenues;
(c) "Available Revenues" shall mean all Non-Ad Valorem Revenues less (i)
the product of (A) all Non-Ad Valorem Revenues divided by total revenues of the City
(excluding amounts in enterprise funds), multiplied by (B) the amount of "Essential Government
Services", and less (ii) revenues pledged to other debt obligations of the City payable from any
portion of Non-Ad Valorem Revenues.
(d) "Essential Government Services" means those expenses related to General
Government Expenditures (as shown on the financial statements of the City) and public safety.
Calculations of Non-Ad Valorem Revenues will be based on information derived from
the most recently audited Fiscal Year end financial statements. For purposes of calculating
Maximum Annual Debt Service, the interest rate to be assumed for indebtedness bearing interest
at a variable rate shall be equal the average rate of interest paid by the City with respect to such
indebtedness during the twelve (12) months preceding the date of calculation.
Section 7.3 Additional Indebtedness. Without the prior written consent of the Bank,
the City shall not hereafter incur any indebtedness payable from any Non-Ad Valorem Revenues
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12
(which includes any increases in the outstanding amount under any line of credit or similar
arrangement), unless (i) Available Revenues of the City during each of the two Fiscal Years most
recently concluded prior to the incurrence of such debt equals or exceeds 150% of the Maximum
Annual Debt Service on all Debt Obligations, including the proposed debt, secured by and/or
payable from such Available Revenues; and (ii) the Maximum Annual Debt Service
requirements on all Debt Obligations, including the proposed debt, secured by and/or payable
from Non-Ad Valorem Revenues will not exceed 20% of governmental fund revenues (defined
as general fund, special fund, debt service fund and capital projects funds) of the City for the
Fiscal Year most recently concluded prior to the incurrence of such proposed debt, exclusive of
(i) ad valorem revenues restricted to payment of debt service on any debt and (ii) any debt
proceeds.
ARTICLE VIII
EVENTS OF DEFAULT
Section 8.1 General. An "Event of Default" shall be deemed to have occurred under
this Agreement if:
(a) The City shall fail to make any payment of the principal of or interest on
the Bonds after the same shall become due and payable, whether by maturity, by acceleration at
the discretion of the Bank as provided for in Section 8.2, or otherwise; or
(b) The City shall default in the performance of or compliance with any term
or covenant contained in the Loan Documents, other than a term or covenant a default in the
performance of which or noncompliance with which is dealt with in Section 8.1 (a) or (c) through
(h) hereof, which default or non-compliance shall continue and not be cured within thirty (30)
days after (i) notice thereof to the City by the Bank; or (ii) the Bank is notified of such
noncompliance or should have been so notified pursuant to the provisions of Section 3 .1 (b) of
this Agreement, whichever is earlier; or
(c) Any representation or warranty made in writing by or on behalf of the City
in any Loan Document shall prove to have been false or incorrect in any material respect on the
date made or reaffirmed; or
(d) The City admits in writing its inability to pay its debts generally as they
become due or files a petition in bankruptcy or makes an assignment for the benefit of its
creditors or consents to the appointment of a receiver or trustee for itself; or
(e) The City is adjudged insolvent by a court of competent jurisdiction, or it is
adjudged a bankrupt on a petition in bankruptcy filed by or against the City, or an order,
judgment or decree is entered by any court of competent jurisdiction appointing, without the
consent of the City, a receiver or trustee of the City or of the whole or any part of its property,
and if the aforesaid adjudications, orders, judgments or decrees shall not be vacated or set aside
or stayed within ninety (90) days from the date of entry thereof; or
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13
(f) The City shall file a petition or answer seeking reorganization or any
arrangement under the federal bankruptcy laws or any other applicable law or statute of the
United States of America or the State of Florida; or
(g) The City shall default in the due and punctual payment or performance of
covenants under any obligation for the payment of money to the Bank or any other subsidiary or
affiliate of the Bank; or
(h) A judgment or order shall be rendered against the City for the payment of
money in excess of$250,000 which is not covered by insurance and such judgment or order shall
continue unsatisfied or unstayed for a period of more than 30 days; or
(i) An event of default occurs with respect to the Prior Debt or any loan
documentation in connection therewith.
Section 8.2 Effect of Event of Default. Except as otherwise provided in the Bonds,
immediately and without notice, upon the occurrence of any Event of Default, the Bank may
declare all obligations of the City under the Loan Documents to be immediately due and payable
without further action of any kind and upon such declaration the Bonds and the interest accrued
thereon shall become immediately due and payable. In addition, and regardless whether such
declaration is or is not made, the Bank may also seek enforcement of and exercise all remedies
available to it under the Bond Ordinance, the Act and any other applicable law.
Should the City default in any obligation created by this Agreement or the Bonds, the
Bank may, in addition to any other remedies set forth in this Agreement or the Bonds, 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 of Florida, or
granted or contained in this Agreement, and may enforce and compel the performance of all
duties required by this Agreement or by any applicable statutes to be performed by the City or by
any officer thereof.
ARTICLE IX
MISCELLANEOUS
Section 9.1 No Waiver; Cumulative Remedies. No failure or delay on the part of the
Bank in exercising any right, power, remedy hereunder, or under the Bonds or other Loan
Documents shall operate as a waiver of the Bank's rights, powers and remedies hereunder, nor
shall any single or partial exercise of any such right, power or remedy preclude any other or
further exercise thereof, or the exercise of any other right, power or remedy hereunder or
thereunder. The remedies herein and therein provided are cumulative and not exclusive of any
remedies provided by law or in equity.
Section 9.2 Amendments. Chane:es or Modifications to the Ae:reement. This
Agreement shall not be amended, changed or modified except by written instrument between the
Bank and the City. The City agrees to pay all of the Bank's reasonable costs and reasonable
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14
attorneys' fees incurred in modifying and/or amending this Agreement at the City's request or
behest.
Section 9.3 Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be an original; but such
counterparts shall together constitute but one and the same Agreement, and, in making proof of
this Agreement, it shall not be necessary to produce or account for more than one such
counterpart.
Section 9.4 Severability. If any clause, provision or section of this Agreement shall
be held illegal or invalid by any court, the invalidity of such clause, provision or section shall not
affect any other provisions or sections hereof, and this Agreement shall be construed and
enforced to the end that the transactions contemplated hereby be effected and the obligations
contemplated hereby be enforced, as if such illegal or invalid clause, provision or section had not
been contained herein.
Section 9.5 Term of A2reement. Except as otherwise specified in this Agreement,
this Agreement and all representations, warranties, covenants and agreements contained herein
or made in writing by the City in connection herewith shall be in full force and effect from the
date hereof and shall continue in effect until as long as the Bonds are outstanding.
Section 9.6 Notices. All notices, requests, demands and other communications which
are required or may be given under this Agreement shall be in writing and shall be deemed to
have been duly given when received if personally delivered; when transmitted if transmitted by
telecopy, electronic telephone line facsimile transmission or other similar electronic or digital
transmission method (provided customary evidence of receipt is obtained); the day after it is
sent, if sent by overnight common carrier service; and five days after it is sent, if mailed,
certified mail, return receipt requested, postage prepaid. In each case notice shall be sent to:
If to the City:
City Manager and City Attorney
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
Fax Number: 305-792-1641
If to the Bank:
SunTrust Bank
777 Brickell Avenue, 4th Floor
Miami, Florida 33131
Attention: Institutional and Government Banking
Fax Number: 305-579-7133
or to such other address as either party may have specified in writing to the other using the
procedures specified above in this Section 9.6.
Section 9.7 Applicable Law. For purposes of this Agreement, Florida law shall
govern the terms of this Agreement. Venue shall be in Miami-Dade County, Florida.
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15
Section 9.8 Bindin2 Effect; Assi2nment. This Agreement shall be binding upon and
inure to the benefit of the successors in interest and permitted assigns of the parties. The City
shall have no rights to assign any of their rights or obligations hereunder without the prior
written consent of the Bank.
Section 9.9 Conflict. In the event any conflict arises between the terms of this
Agreement and the terms of any other Loan Document, the terms of this Agreement shall govern
in all instances of such conflict.
Section 9.10 No Third Party Beneficiaries. It is the intent and agreement of the
parties hereto that this Agreement is solely for the benefit of the parties hereto and no person not
a party hereto shall have any rights or privileges hereunder.
Section 9.11 Attornevs Fees. To the extent legally permissible, the City and the Bank
agree that in any suit, action or proceeding brought in connection with this Agreement, the
Bonds, or the Bond Ordinance (including any appeal(s)), the prevailing party shall be entitled to
recover costs and attorneys' fees from the other party. The City does not waive sovereign
immunity for any claim for breach of contract or for an award of prejudgment interest; provided,
however, that in any action arising out of or to enforce this Agreement, the prevailing party shall
be entitled to its reasonable attorney's fees and costs. The City agrees that should this
transaction fail to close for any reason, the Bank's Counsel shall be entitled to be reimbursed for
any of their out-of-pocket costs and to be paid a reasonable fee for its services through the
expiration date of the Commitment, and City understands that such fee shall be paid by City
immediately upon receipt of a statement.
Section 9.12 Entire A2reement. Except as otherwise expressly provided, this
Agreement and the other Loan Documents embody the entire agreement and understanding
between the parties hereto and supersede all prior agreements and understandings relating to the
subject matter hereof.
Section 9.13 Further Assurances. The parties to this Agreement will execute and
deliver, or cause to be executed and delivered, such additional or further documents, agreements
or instruments and shall cooperate with one another in all respects for the purpose of carrying out
the transactions contemplated by this Agreement.
Section 9.14 Waiver of JUry Trial. THE CITY AND THE BANK IRREVOCABLY
AND VOLUNTARILY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY CONTROVERSY OR CLAIM BETWEEN THEM, WHETHER ARISING
IN CONTRACT, TORT OR BY STATUTE, THAT ARISES OUT OF OR RELATES TO THIS
AGREEMENT, THE BONDS OR THE BOND ORDINANCE. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE CITY AND THE BANK TO ENTER INTO THIS
AGREEMENT.
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16
IN WITNESS WHEREOF, the parties have executed this Agreement to be effective
between them as of the date of first set forth above.
CITY OF SUNNY ISLES BEACH, FLORIDA
By:
Norman S. Edelcup
Mayor
SUNTRUST BANK
By:
Delle Joseph
First Vice President
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17
EXHIBIT "A" TO LOAN AGREEMENT
March _,2010
$15,000,000
CITY OF SUNNY ISLES BEACH, FLORIDA
CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2010
KNOW ALL MEN BY THESE PRESENTS that the City of Sunny Isles Beach, Florida
(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 SunTrust Bank, or registered assigns (hereinafter, the "Bank" or the
"Holder"), the principal sum of $15,000,000, together with interest on the principal balance
outstanding at the rate of 4.20% per annum (subject to adjustment as hereinafter provided), based
upon a year of 360 days for the actual number of days elapsed. Payments shall be made by auto
debit of the City's account with the Bank in immediately available funds by no later than 2:00
p.m. on the date due, free and clear of any defenses, set-off, counterclaims, or withholdings or
deductions for taxes.
Principal of and interest on this Bond are payable in lawful money of the United States of
America at such place as the Bank may designate to the City.
For purposes of this Bond, the following definitions shall apply:
(1) "Code" means the Internal Revenue Code of 1986, as amended;
(2) "Cost of Funds" means 100 multiplied by a fraction, the numerator of
which is equal to the total interest expense of SunTrust Bank for its immediately
preceding tax year and the denominator of which is equal to the average total assets of
SunTrust Bank for such tax year, but not to exceed the cost of Fed Funds.
(3) "Fully Taxable Equivalent" means the rate of interest on the Bonds
multiplied by 1.5247, expressed as a number and not as a percentage.
(4) "Maximum Corporate Tax Rate" means the maximum Federal income tax
rate applicable to corporations, presently 35%.
(5) "Preference Reduction Rate" means the percentage reduction to be applied
to the amount allowable as a deduction under Chapter I of the Code with respect to any
financial institution preference item (as such term is defined in Section 291 (e) of the
Code), presently 20%. If this Bond is not or ceases to be a "qualified tax-exempt
obligation" as defined in Section 265(b) of the Code, the Preference Reduction Rate shall
be deemed to increase from twenty percent (20%) to one hundred percent (100%).
(6) "TEFRA Adjustment" means an adjustment equal to the product of the
Cost of Funds multiplied by the applicable Maximum Corporate Tax Rate multiplied by
the applicable Preference Reduction Rate.
A-I
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If for any reason the interest on this Bond becomes includable in the gross income of the
holder of this Bond for Federal income tax purposes (an "Event of Taxability"), this Bond shall
bear interest from the earliest effective date of such Event of Taxability at a rate per annum equal
to the interest rate otherwise borne by this Bond multiplied by 1.5247. In addition to the
foregoing, the City shall pay any additions to tax, penalties and interest, and any arrears in
interest imposed upon the holder of this Bond on account of an Event of Taxability. All such
additional interest, additions to tax and penalties shall be paid on the next succeeding Bond
Payment Date following the date the holder was advised of such Event of Taxability.
No Event of Taxability shall be deemed to occur unless the City has been given timely
written notice of such occurrence by the Holder of this Bond and, to the extent permitted by law,
an opportunity to participate in and seek, at the City's own expense, a final administrative
determination by the Internal Revenue Service or determination by a court of competent
jurisdiction (from which no further right of appeal exists) as to the occurrence of such Event of
Taxability; provided that the City, at its own expense, delivers to the Holder of this Bond an
opinion of bond counsel acceptable to such Holder to the effect that such appeal or action for
judicial or administrative review is not without merit and there is a reasonable possibility that the
judgment, order, ruling or decision from which such appeal or action for judicial or
administrative review is taken will be reversed, vacated or otherwise set aside.
The interest rate borne by this Bond shall also be adjusted automatically as of the
effective date of any change in the Maximum Corporate Tax Rate or in the Preference
Reduction Rate, to the product obtained by multiplying the rate of interest on the Bonds by a
fraction, the numerator of which is equal to the sum of (i) the product of the Fully Taxable
Equivalent times 1 minus the Maximum Corporate Tax Rate in effect as of the date of
adjustment, plus (ii) the TEFRA Adjustment in effect as of the date of adjustment, and the
denominator of which is equal to the sum of (i) the product of the Fully Taxable Equivalent
times 0.65, plus (ii) the TEFRA Adjustment in effect on the date of issuance of the Bonds.
A certificate of the Holder as to any such additional amount or amounts, in the absence of
manifest error, shall be final and conclusive. In determining such amount, the Holder may use
any reasonable averaging and attribution methods.
The principal on this Bond shall be due and payable on January 1, April 1, July 1 and
October 1 of each year (each, a "Bond Payment Date"), beginning October 1, 2010, through and
including March 24, 2025 (the "Maturity Date") (except that the last payment will be made on
the Maturity Date), in the amounts set forth on the payment schedule attached hereto.
Interest on this Bond shall be due and payable on each Bond Payment Date, beginning
October 1, 2010, through and including the Maturity Date (except that the last payment will be
made on the Maturity Date). The entire unpaid principal balance, together with all accrued and
unpaid interest hereon, shall be due and payable in full on the Maturity Date. All payments by
the City pursuant to this Bond shall apply first to accrued interest, then to other charges due the
Bank, and the balance thereof shall apply to the principal sum due.
Upon two (2) Business Days prior written notice to the Holder, the City may prepay
amounts owing under this Bond at any time and from time to time. Such prepayment notice shall
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specify the amount of the prepayment which is to be applied. In the event of prepayment while
SunTrust Bank (the "Bank") is the Holder of this Bond, the City may be required to pay the
Bank an additional fee (a prepayment charge) determined in the manner provided below, to
compensate the Bank for all losses, costs and expenses incurred in connection with such
prepayment. The fee shall be equal to the present value of the difference between (1) the amount
that would have been realized by the Bank on the prepaid amount for the remaining term of the
Bond at the then current rate of interest on the Bonds and (2) the amount that would be realized
by the Bank by reinvesting such prepaid funds for the remaining term of the Bond at the Federal
Reserve H.15 Statistical Release rate for fixed-rate payers in interest rate swaps, interpolated to
the nearest month, that was in effect three Business Days prior to the Bond prepayment date;
both discounted at the same interest utilized in determining the applicable amount in (2). Should
the present value have no value or a negative value, the City may repay with no additional fee.
Should the Federal Reserve no longer release rates for fixed-rate payers in interest rate swaps,
the Bank may substitute the Federal Reserve H.15 Statistical Release with another similar index.
The Bank shall provide the City with a written statement explaining the calculation of the
premium due, which statement shall, in absence of manifest error, be conclusive and binding.
Partial prepayments may be made, subject to a prepayment charge based upon the same
calculation methodology described above. Any partial prepayment shall be applied to
installments of principal in the inverse order of maturity and shall not postpone the due dates of,
or relieve the amounts of, any scheduled installment payments due hereunder. Any amounts
prepaid hereunder may not be re-borrowed. For purposes of the preceding paragraph, the term
Business Day shall mean any day other than a Saturday, Sunday or legal holiday or other day on
which the Bank is authorized or required to close.
Interest at the lesser of 12% per annum or the maximum lawful rate per annum shall be
payable on the entire principal balance owing hereunder from and after the occurrence of and
during the continuation of an Event of Default under the Loan Agreement (but only after the
passage of any applicable grace period permitted for such Event of Default), irrespective of a
declaration of maturity.
The City to the extent permitted by law hereby waives presentment, demand, protest and
notice of dishonor.
This Bond is issued pursuant to (i) an Ordinance and a Resolution, both duly adopted by
the City on March 18, 2010 (collectively, the "Bond Ordinance"), for the purpose of financing a
portion of the costs of development of City property for City parks to be located on Collins
Avenue and Sunny Isles Boulevard, financing architectural, engineering, environmental, legal
and other planning costs related thereto, and paying costs of issuance of the bonds (the
"Project"), and (ii) a Loan Agreement, dated of even date herewith, between the City and the
Bank (the "Loan Agreement") and is subject to all the terms and conditions of the Loan
Agreement. All terms, conditions and provisions of the Loan Agreement are by this reference
thereto incorporated herein as a part of this Bond. Terms used herein in capitalized form and not
otherwise defined herein shall have the meanings ascribed thereto in the Loan Agreement.
The City has covenanted and agreed in the Loan Agreement to appropriate in its annual
budget, by amendment, if necessary, from Non-Ad Valorem Revenues lawfully available in each
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{MI883440_2}
Fiscal Year, amounts sufficient to pay the principal and interest due on the Bonds in accordance
with its terms during such Fiscal Year. "Non-Ad Valorem Revenues" means all revenues of the
City derived from any source other than ad valorem taxation on real or personal property which
the City derived from any source other than ad valorem taxation on real or personal property
which are legally available to make the payments required under the Loan Agreement; but only
after provision has been made by the City for the payment of all essential or legally mandated
services. Such covenant and agreement on the part of the City to budget and appropriate 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 been budgeted, appropriated and
actually paid. Notwithstanding the foregoing covenant of the City, the City does not covenant to
maintain any services or programs, now provided or maintained by the City, which generate
Non-Ad Valorem Revenues.
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 from pledging in the future its Non-Ad
Valorem Revenues, nor does it require the City to levy and collect any particular Non-Ad
Valorem Revenues, nor does it give the Bond Holders a prior claim on the Non-Ad Valorem
Revenues as opposed to claims of general creditors of the City. Such covenant to appropriate
Non-Ad Valorem Revenues is subject in all respects to the payment of obligations secured by a
pledge of such Non-Ad Valorem Revenues heretofore or hereafter entered into (including the
payment of debt service on bonds and other debt instruments). However, the covenant to budget
and appropriate in its general annual budget for the purposes and in the manner stated in the
Loan Agreement shall have the effect of making available in the manner described herein Non-
Ad Valorem Revenues and placing on the City a positive duty to appropriate and budget, by
amendment, if necessary, amounts sufficient to meet its obligations under the Loan Agreement,
subject, however, in all respects to the terms of the Loan Agreement; and subject, further, to the
payment of services and programs which are for essential public purposes affecting the health,
welfare and safety of the inhabitants of the City or which are legally mandated by applicable law.
Reference is hereby made to the Loan Agreement for the provisions, among others,
relating to the terms, lien and security of the Bonds, the custody and application of the proceeds
of the Bonds, the rights and remedies of the Holder of the Bonds, and the extent of and
limitations on the City's rights, duties and obligations, to all of which provisions the Holder
hereof for himself and his successors in interest assents by acceptance of this Bond.
THIS BOND SHALL NOT BE DEEMED TO CONSTITUTE A GENERAL DEBT OR
A PLEDGE OF THE FAITH AND CREDIT OF THE CITY, OR A DEBT OR PLEDGE OF
THE FAITH AND CREDIT OF THE STATE OF FLORIDA OR ANY POLITICAL
SUBDIVISION THEREOF WITHIN THE MEANING OF ANY CONSTITUTIONAL
,
LEGISLATIVE OR CHARTER PROVISION OR LIMITATION, AND IT IS EXPRESSLY
AGREED BY THE HOLDER OF THIS BOND THAT SUCH HOLDER SHALL NEVER
HAVE THE RIGHT, DIRECTLY OR INDIRECTLY, TO REQUIRE OR COMPEL THE
EXERCISE OF THE AD V ALOREM TAXING POWER OF THE CITY OR ANY OTHER
POLITICAL SUBDIVISION OF THE STATE OF FLORIDA OR TAXATION IN ANY FORM
ON ANY REAL OR PERSONAL PROPERTY FOR THE PAYMENT OF THE PRINCIPAL
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{MI883440_2}
OF, PREMIUM, IF ANY, AND INTEREST ON THIS BOND OR FOR THE PAYMENT OF
ANY OTHER AMOUNTS PROVIDED FOR IN THE LOAN AGREEMENT.
It is further agreed between the City and the Holder ofthis Bond that neither the members
of the Governing Body of the City nor any person executing the Bonds shall be liable personally
on the Bonds by reason of its issuance.
This Bond may be exchanged or transferred by the Bank hereof but only upon the
registration books maintained by the City and in the manner provided in the Loan Agreement.
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 Bond do exist, have happened and have been performed in due time, form and
manner as required by law, and that the issuance of this Bond is in full compliance with and does
not exceed or violate any constitutional or statutory limitation.
IN WITNESS WHEREOF, the City of Sunny Isles Beach, Florida has caused this Bond
to be executed in its name by the manual signature of its Mayor, and attested by the manual
signature of its Clerk and its corporate seal or a facsimile thereof affixed hereto, all as of this
_ day of March, 2010.
CITY OF SUNNY ISLES BEACH, FLORIDA
By:
Mayor
[SEAL]
ATTEST:
By:
Clerk
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..
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
the within Bonds and all rights
thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer the within Bonds in the
books kept by the City for the registration thereof, with full power of substitution in the
premIses.
Date:
SOCIAL SECURITY NUMBER OR
FEDERAL IDENTIFICATION
NUMBER OF ASSIGNEE
NOTICE: The signature of this
assignment must correspond with the
name as it appears upon the within
Bonds in every particulate, or any
change whatever.
[Form of Abbreviations]
The following abbreviations, when used in the inscription on the face of the within
Bonds, shall be construed as though they were written out in full according to the applicable laws
or regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with the
UNIFORM TRANS MIN ACT -
Uniform Transfers to Minors Act of
right of survivorship and not as tenants in common
Custodian for (Cust.) (Minor) under
(State).
Additional abbreviations may also be used
though not in the above list.
Name and address of assignee for payment and notice purposes
Notice:
Payment:
Date:
Assignee:
By:
Title:
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PRINCIPAL PAYMENT SCHEDULE
City of Sunny Isles Beach, Florida
$15,000,000 Tax Exempt Bank Qualified Loan
Issuance Date: 3/24/2010
Interest Rate: 4.20%
# Date Payment Interest Principal Balance
Loan 3/24/2010 15,000,000.00
1 10/1/2010 346,227.19 329,000.00 1 7,227. 1 9 14,982,772.81
2010 Totals 346,227.19 329,000.00 17,227.19
2 1/1/2011 346,227.19 157,319.11 188,908.08 14,793,864.73
3 4/1/2011 346,227.19 155,335.58 190,891.61 14,602,973.12
4 7/1/2011 346,227.19 153,331.22 192,895.97 14,410,077.15
5 10/1/2011 346,227.19 151,305.81 194,921.3 8 14,215,155.77
2011 Totals 1,384,908.76 617,291.72 767,617.04
6 1/1/2012 346,227.19 149,259.14 196,968.05 14,018,187.72
7 4/1/2012 346,227.19 147,190.97 199,036.22 13,819,151.50
8 7/1/2012 346,227.19 145,101.09 201,126.10 13,618,025.40
9 10/1/2012 346,227.19 142,989.27 203,237.92 13,414,787.48
2012 Totals 1,384,908.76 584,540.4 7 800,368.29
10 1/1/2013 346,227.19 140,855.27 205,371.92 13,209,415.56
11 4/1/2013 346,227.19 138,698.86 207,528.33 13,001,887.23
12 7/1/2013 346,227.19 136,519.82 209,707.37 12,792,179.86
13 10/1/2013 346,227.19 134,317.89 211,909.30 12,580,270.56
2013 Totals 1,384,908.76 550,391.84 834,516.92
14 1/1/2014 346,227.19 132,092.84 214,134.35 12,366,136.21
15 4/1/2014 346,227.19 129,844.43 216,382.76 12,149,753.45
16 7/1/2014 346,227.19 127,572.41 218,654.78 11,931,098.67
17 10/1/2014 346,227.19 125,276.54 220,950.65 11,710,148.02
2014 Totals 1,384,908.76 514,786.22 870,122.54
18 1/1/2015 346,227.19 122,956.55 223,270.64 11,486,877.38
19 4/1/2015 346,227.19 120,612.21 225,614.98 11,261,262.40
20 7/1/2015 346,227.19 118,243.26 227,983.93 11,033,278.4 7
21 10/1/2015 346,227.19 115,849.42 230,377.77 10,802,900.70
2015 Totals 1,384,908.76 477,661.44 907,247.32
22 1/1/2016 346,227.19 113,430.46 232,796.73 10,570,103.97
23 4/1/2016 346,227.19 110,986.09 235,241.1 0 10,334,862.87
24 7/1/2016 346,227.19 108,516.06 237,711.13 10,097,151.74
25 10/1/2016 346,227.19 106,020.09 240,207.10 9,856,944.64
2016 Totals 1,384,908.76 438,952.70 945,956.06
A-7
{M1883440_2}
# Date Payment Interest Principal Balance
26 l/l/20 17 346,227.19 103,497.92 242,729.27 9,614,215.37
27 4/l/20 17 346,227.19 100,949.26 245,277.93 9,368,937.44
28 7/1/2017 346,227.19 98,373.84 247,853.35 9,121,084.09
29 10/1/2017 346,227.19 95,771.38 250,455.81 8,870,628.28
2017 Totals 1,384,908.76 398,592.40 986,316.36
30 l/l/2018 346,227.19 93,141.60 253,085.59 8,617,542.69
31 4/l/2018 346,227.19 90,484.20 255,742.99 8,361,799.70
32 7/l/2018 346,227.19 87,798.90 258,428.29 8,103,371.41
33 10/l/2018 346,227.19 85,085.40 261 , 141. 79 7,842,229.62
2018 Totals 1,384,908.76 356,510.10 1,028,398.66
34 l/l/20 19 346,227.19 82,343.41 263,883.78 7,578,345.84
35 4/1/2019 346,227.19 79,572.63 266,654.56 7,311,691.28
36 7/1/2019 346,227.19 76,772.76 269,454.43 7,042,236.85
37 10/1/2019 346,227.19 73,943.49 272,283.70 6,769,953.15
2019 Totals 1,384,908.76 312,632.29 1,072,276.4 7
38 l/l/2020 346,227.19 71,084.51 275,142.68 6,494,810.4 7
39 4/l/2020 346,227.19 68,195.51 278,031.68 6,216,778.79
40 7/l/2020 346,227.19 65,276.18 280,951.01 5,935,827.78
41 10/1/2020 346,227.19 62,326.19 283,901.00 5,651,926.78
2020 Totals 1,384,908,76 266,882.39 1,118,026.37
42 1/1/2021 346,227.19 59,345.23 286,881.96 5,365,044.82
43 4/ l/2021 346,227.19 56,332.97 289,894.22 5,075,150.60
44 7/l/2021 346,227.19 53,289.08 292,938.11 4,782,212.49
45 10/l/2021 346,227.19 50,213.23 296,013.96 4,486,198.53
2021 Totals 1,384,908.76 219,180.51 1,165,728.25
46 1/1/2022 346,227.19 47,105.08 299,122.11 4,187,076.42
47 4/1/2022 346,227.19 43,964.30 302,262.89 3,884,813 .53
48 7/l/2022 346,227.19 40,790.54 305,436.65 3,579,376.88
49 10/1/2022 346,227.19 37,583.46 308,643.73 3,270,733.15
2022 Totals 1,384,908.76 169,443.38 1,215,465.38
50 1/1/2023 346,227.19 34,342.70 311,884.49 2,958,848.66
51 4/1 12023 346,227.19 31,067.91 315,159.28 2,643,689.38
52 7/ l/2023 346,227.19 27,758.74 318,468.45 2,325,220.93
53 10/1/2023 346,227.19 24,414.82 321,812.37 2,003,408.56
2023 Totals 1,384,908.76 117,584.17 1,267,324.59
54 l/l/2024 346,227.19 21,035.79 325,191.40 1,678,217.16
55 4/l/2024 346,227.19 17,621.28 328,605.91 1,349,611.25
56 7/l/2024 346,227.19 14,170.92 332,056.27 1,017,554.98
57 10/1/2024 346,227.19 10,684.33 335,542.86 682,012.12
2024 Totals 1,384,908.76 63,512.32 1,321,396.44
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{MI883440_2}
# Date Payment Interest Principal Balance
58 1/1/2025 346,227.19 7,161.13 339,066.06 342,946.06
59 3/24/2025 346,227.19 3,281.13 342,946.06 -
2025 Totals 692,454.38 10,442.26 682,012.12
Grand Totals 20,427,404.21 5,427,404.21 15,000,000.00
Last interest amount increased by 0.28 due to rounding.
A-9
{MI883440_2}
City of Sunny Isles Beach
18070 Collins A venue
Sunny Isles Beach, Florida 33160
(305) 947-0606 City HaU
(305) 949-3113 Fax
MEMORANDUM
TO:
The Honorable Mayor and City Commission
FROM:
Doug Haag, Assistant City Manager - Finance
DATE:
3/18/20 I 0
RE:
TAX EXEMPT BANK QUALIFIED LOAN - $15 MILLION
RECOMMENDA TION:
Approve the ordmance and loan doCllIl"fi1ts with SlIDTrust Bank for a $15 million fixed rate
loan to be repaid over 15 ~ and at an interest rate of 4.20%. This rate is locked for 60
days from February 19, 2010.
This loan will be repaid from legallyavailablenon ad valorem revenues, The loan can be
repaid early but is subject to penalty provisions of the agreement wuch may be triggered
depending upon current market interest rates at the time of prepayment. Payments will be
made quarterly, beginning October I, 2010, The total annual debt service will be
approximately $1,352,930. Proceeds from the loan will be used for the developrrent of Gty
property for parks located on Collins Avenue and SlIDI1Y Isles Boulevard.
The loan documents will need to be signed after the second ordinance reading which has
been scheduled for the regular commission meeting on Thursday, March 18, 20 I O. The
closing and settlement will occur shortly thereafter.
REASONS:
BACKGROUND:
The City requested a letter of interest from the following financial institutions:
. Bank of America
. Sun Trust Bank
.UBS
. BB & T
. MorganStanley SmithBarney
Agenda Item No.1 OA
Date 3/18/20 I 0
UBS and MorganStanley SmithBarney tried to put something together but based on
market conditions and/or corporate policy were unable to come up with a tax exempt
fixed rate loan.
Bank of America submitted a proposal but due to corporate policy restrictions, they were
only able to come up with $5 million.
That left just two firm proposals for the loan:
· SunTrust Bank
. BB&T
Of these two, SunTrust Bank had the lowest rate of 4.20% as compared to a rate of
4.35% - 4.45% for BB & T for a 15 year term. The first payment will not be due until
October I, 2010 so funding will be included in the proposed FY 20 10/20 I I budget.
A TT ACHMENTS:
. Resolution
. Exhibit A - Commitment Letter
. Exhibit B - Agreement
Agenda Item No.lOA
Date 3/18/20 I 0