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Resolution 545-2002 ADOPTED DECEMBER 18 , 2002 SOLID WASTE DISPOSAL SYSTEM REFUNDING REVENUE NOTE, SERIES 2002 RESOLUTION MONROE COUNTY, FLORIDA 11 OPTIONAL PREPAYMENT. ............................ 17 MANDATORY PREPAYMENT. ......................... 18 PAYMENT OF PREPAID SERIES 2002 NOTE. . . . . . . . . . . . . . 18 ARTICLE III PREP A YMENT OF THE SERIES 2002 NOTE SECTION 3.01. SECTION 3.02. SECTION 3.03. SECTION 2.01. AUTHORIZATION OF THE SERIES 2002 NOTE. ........... 8 SECTION 2.02. APPLICATION OF SERIES 2002 NOTE PROCEEDS; TRANSFER OF CERTAIN MONEYS. ................8 SECTION 2.03. EXECUTION OF THE SERIES 2002 NOTE. ................ 9 SECTION 2.04. SERIES 2002 NOTE MUTILATED, DESTROYED, STOLEN OR LOST. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 SECTION 2.05. REGISTRATION OF SERIES 2002 NOTE................. 10 SECTION 2.06. DESIGNATION OF THE SERIES 2002 NOTE AS A QUALIFIED TAX-EXEMPT OBLIGATION ...... . . . . 10 SECTION 2.07. ADJUSTMENTS TO INTEREST RATE................... 10 SECTION 2.08. FORM OF THE SERIES 2002 NOTE. ..................... 11 ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF THE SERIES 2002 NOTE DEFINITIONS. ........................................ 1 AUTHORITY FOR RESOLUTION. . . . . . . . . . . . . . . . . . . . . . . . . 6 RESOLUTION TO CONSTITUTE CONTRACT. ............. 6 FINDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 ACCEPTANCE OF BID PROPOSAL. ...................... 7 AUTHORIZATION OF REFUNDING OF REFUNDED BONDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 ARTICLE I GENERAL Pa2e TABLE OF CONTENTS SECTION 1.01. SECTION 1.02. SECTION 1.03. SECTION 1.04. SECTION 1.05. SECTION 1.06. 111 SECTION 7.01. SERIES 2002 NOTE EVIDENCES A LOAN. ............... 29 ARTICLE VII MISCELLANEOUS SECTION 6.01. SUPPLEMENTAL RESOLUTIONS WITH THE SERIES 2002 NOTEHOLDERCONSENT. ...................28 ARTICLE VI SUPPLEMENTAL RESOLUTIONS DEF AUL TS DEFINED. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 REMEDIES ON DEF AUL T. .......... . . . . . . . . . . . . . . . . . . . 26 REMEDIES CUMULATIVE. ............................ 26 WAIVER OF DEF AUL T. ............................... 27 ARTICLE V DEF AUL TS AND REMEDIES SERIES 2002 NOTE NOT TO BE INDEBTEDNESS OF ISSUER. ....................................... 19 SECURITY FOR THE SERIES 2002 NOTE. .. . . .. . . .... . . . . 19 CREATION OF FUNDS AND ACCOUNTS. . . . . . . . . . . . . . . . . 19 DISPOSITION OF REVENUES. . . . . . . . . . . . . . . . . . . . . . . . . . . 20 PAYMENT OF THE SERIES 2002 NOTE. ................. 21 REBATE ACCOUNT. ..................................22 SEPARATE ACCOUNTS. ..............................22 INVESTMENTS. ...................................... 23 FEDERAL INCOME TAX COVENANTS. ................. 23 ANNUAL AUDIT AND BUDGET. ....................... 23 OTHER MONEYS. .................................... 24 ADDITIONAL DEBT .................................. 24 SYSTEM RATES ..................................... 24 AUTHORIZATION TO EXECUTE ESCROW DEPOSIT AGREEMENT .................................. 25 CONSTRUCTION, OPERATION AND MAINTENANCE. . . . . 25 ENFORCEMENT OF CHARGES . . . . . . . . . . . . . . . . . . . . . . . . . 25 ARTICLE IV SECURITY; DEBT SERVICE FUND; COVENANTS OF THE ISSUER SECTION 5.01. SECTION 5.02. SECTION 5.03. SECTION 5.04. SECTION 4.15. SECTION 4.16. SECTION 4.02. SECTION 4.03. SECTION 4.04. SECTION 4.05. SECTION 4.06. SECTION 4.07. SECTION 4.08. SECTION 4.09. SECTION 4.10. SECTION 4.11. SECTION 4.12. SECTION 4.13. SECTION 4.14. SECTION 4.01. IV FORM OF ESCROW DEPOSIT AGREEMENT ............ D-I BID PROPOSAL ..................................... C-I REQUEST FOR COMMITMENT. . . . . . . . . . . . . . . . . . . . . . . . B-1 DISCLOSURE LETTER AND TRUTH-IN-BONDING STATEMENT. . . . . . . . . . . . . . . . . . A-I WAIVER OF JURY TRIAL ............................. 29 GENERAL AUTHORITY. .............................. 29 SEVERABILITY OF INVALID PROVISIONS. ............. 29 REPEAL OF INCONSISTENT RESOLUTIONS. ............ 30 EFFECTIVE DATE. ................................... 30 EXHIBIT D EXHIBIT C EXHIBIT B EXHIBIT A SECTION 7.02. SECTION 7.03. SECTION 7.04. SECTION 7.05. SECTION 7.06. RESOLUTION NO. 545-2002 A RESOLUTION OF THE BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORIDA ACCEPTING THE PROPOSAL OF SUNTRUST BANK TO PROVIDE THE COUNTY WITH A LOAN IN AN AGGREGATE PRINCIPAL AMOUNT OF $4,143,945.49 IN ORDER TO REFUND ALL OF THE OUTSTANDING MONROE COUNTY MUNICIPAL SERVICE DISTRICT REFUNDING IMPROVEMENT BONDS, SERIES 1991; AUTHORIZING THE ISSUANCE OF THE MONROE COUNTY SOLID WASTE DISPOSAL SYSTEM REFUNDING REVENUE NOTE, SERIES 2002 TO EVIDENCE SUCH LOAN; PLEDGING THE GROSS REVENUES OF THE COUNTY'S SOLID WASTE DISPOSAL SYSTEM AND CERTAIN OTHER FUNDS TO PAY THE SERIES 2002 NOTE; PROVIDING CERTAIN TERMS AND DETAILS OF THE SERIES 2002 NOTE; MAKING CERTAIN COVENANTS AND PROVIDING CERTAIN RIGHTS TO THE HOLDER OF THE SERIES 2002 NOTE; AUTHORIZING TIlE DELIVERY AND EXECUTION OF AN ESCROW DEPOSIT AGREEMENT AND THE APPOINTMENT OF AN ESCROW AGENT TIlERETO; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MONROE COUNTY, FLORIDA: ARTICLE I GENERAL SECTION 1.01. DEFINITIONS. When used in this Resolution, all capitalized terms shall have the meaning set forth below: "Authorized Investments" shall mean any investments that are lawful and valid pursuant to State law for government entities such as the Issuer. "Bid Proposal" shall mean the Bid Proposal submitted by SunTrust Bank in response to the Request for Commitment, a copy of which Bid Proposal is attached hereto as Exhibit C. "Board" shall mean the Board of County Commissioners of the Issuer. "Bond Counsel" shall mean Nabors, Giblin & Nickerson, P .A. or any other attorney at law or firm of attorneys, of nationally recognized standing in matters pertaining to the federal tax exemption of interest on obligations issued by states and political subdivisions, and duly admitted to practice law before the highest court of any state of the United States of America. "Code" shall mean the Internal Revenue Code of 1986, as amended, and the regulations and rules thereunder in effect or imposed. "Clerk" shall mean the Clerk of the Circuit Court for Monroe County, Florida, and Ex-officio Clerk of the Board of County Commissioners ofthe Issuer, or such other person as may be duly authorized to act on his or her behalf. "Consulting Engineers" shall mean any engineering firm of reputation for skill and experience with respect to the construction and operation of facilities similar to those that comprise the System, which is duly licensed under the laws of the State of Florida and designated by the Issuer to perform the duties of the Consulting Engineers under the provisions hereof. "County Administrator" shall mean the County Administrator of the Issuer, and such other person as may be authorized to act on his or her behalf. "County Attorney" shall mean the County Attorney of the Issuer, and such other person as may be authorized to act on his or her behalf. "Determination of Taxability" shall mean the circumstance of interest paid or payable on the Series 2002 Note becoming includable for federal income tax purposes in the gross income ofthe Holder of the Series 2002 Note for any reason whatsoever and regardless of whether the same was within or beyond the control of the Issuer. A Determination of Taxability shall be evidenced by either (a) the receipt by the Issuer or Holder of the Series 2002 Note of an original or a copy of an Internal Revenue Service Technical Advice Memorandum or Statutory Notice of Deficiency which holds that any interest payable on the Series 2002 Note is includable in the gross income of such Holder of the Series 2002 Note; (b) the issuance of any public or private ruling of the Internal Revenue Service that any 2 interest payable on the Series 2002 Note is includable in the gross income of the Holder of the Series 2002 Note; or (c) receipt by the Issuer or the Holder of the Series 2002 Note of an opinion of Bond Counsel that any interest on the Series 2002 Note has become includable in the gross income of the Holder of the Series 2002 Note for federal income tax purposes. For all purposes of this definition, a Determination of Taxability will be deemed to occur on the first date as of which the interest on the Series 2002 Note is deemed includable in the gross income of the Holder of the Series 2002 Note. A Determination of Taxability shall not occur solely from the fact that such interest is taken into account in determining adjusted current earnings for the purpose of the alternative minimum income tax imposed on corporations. "Escrow Deposit Agreement" shall mean the agreement authorized pursuant to Section 4.14 hereof. "Federal Securities" shall have the meaning ascribed thereto in the Refunded Bonds Resolution. "Fiscal Year" shall mean the period commencing on October 1 of each year and continuing through the next succeeding September 30, or such other period as may be prescribed by law. "Gross Revenues" shall mean all income and moneys received by the Issuer from the rates, fees, rentals, charges, assessments and other income to be made and collected by the Issuer for the use of the products, services and facilities to be provided by the System or otherwise received by the Issuer or accruing to the Issuer in the management and operation of the System calculated in accordance with generally accepted accounting principles applicable to solid waste collection, disposal and management systems similar to the System, including, without limiting the generality of the foregoing, any investment of moneys under the provisions of this Resolution. Gross Revenues shall not include any federal or state grant moneys received by the Issuer. "Holder" or "Series 2002 Noteholder" or "Registered Owner" shall mean the owner of the Series 2002 Note as set forth on the registration books of the Issuer. The original Holder of the Series 2002 Note shall be SunTrust Bank. "Interest Rate" shall mean the annual fixed interest rate equal to 3.41 % per annum. The Interest Rate shall be calculated on the basis of a 360-day year consisting of twelve 30- day months. 3 "Issuer" or "County" shall mean Monroe County, Florida, a political subdivision of the State. "Maximum Annual Debt Service" shall mean the maximum annual debt service to come due during any subsequent Fiscal Year of the Issuer on the Series 2002 Note and all other outstanding debt of the Issuer issued subsequently to the Series 2002 Note which is secured by or payable from the Pledged Revenues on a parity basis as to the Series 2002 Note. With respect to any variable rate debt, the interest rate used to determine Maximum Annual Debt Service shall be the greater of (a) 6.00% per annum, or (b) the average actual interest rate in effect during the applicable Test Period. "Mayor" shall mean the Chairperson or Mayor of the Board of County Commissioners of Monroe County, Florida and such other person as may be duly authorized to act on his or her behalf. "Net Revenues" shall mean Gross Revenues less Operating Expenses. "Operating Expenses" shall mean the Issuer's expenses for operation, maintenance, repairs and replacements with respect to the System and shall include, without limiting the generality of the foregoing, administration expenses, insurance and surety bond fees, accounting, legal, financial advisory, consulting and engineering expenses, fees for the management of the System or any portion thereof, payments made in regard to the purchase of materials or services essential to or to be used in the operation of the System, ordinary and current rentals of equipment or other property, refunds of moneys lawfully due to others, payments to others for disposal or recycling of solid wastes, paYments to pension, retirement, health and hospitalization funds, and any other expenses required to be paid for or with respect to proper operation or maintenance of the System, including appropriate reserves therefor, all to the extent properly attributable to the System in accordance with generally accepted accounting principles applicable to public solid waste collection, disposal and management systems similar to the System, but does not include (1) any costs or expenses in respect of original construction or improvement other than expenditures necessary to prevent an interruption or continuance of an interruption of service or of Gross Revenues, (2) minor capital expenditures necessary for the proper and economical operation or maintenance of the System, or (3) any provision for interest, depreciation, amortization or similar charges. "Outstanding," when used with reference to the Series 2002 Note and as of any particular date, shall describe that portion of the Series 2002 Note theretofore and thereupon being delivered and which remains unpaid except any Series 2002 Note in lieu of which 4 another Series 2002 Note or Notes has been issued under agreement to replace a lost, mutilated or destroyed Series 1999 Bonds pursuant to Section 2.04 hereof. "Pledged Revenues" shall mean (1) the Gross Revenues, and (2) until applied in accordance with the provisions of this Resolution, all moneys, including investments thereof, in the funds and accounts established hereunder. "Refunded Bonds" shall mean all of the outstanding Monroe County Municipal Service District Refunding Improvement Bonds, Series 1991, dated as of April 1, 1991, issued in the aggregate principal amount of$9,570,000, and $5,660,000 of which currently remains outstanding. "Refunded Bonds Resolution" shall mean the Issuer's Resolution No. 061-1991, adopted by the Board on March 12, 1991, as amended and supplemented. "Request for Commitment" shall mean the Request for Commitment distributed by the Issuer's Financial Advisor, Public Financial Management Inc., on behalf of the Issuer with respect to the Series 2002 Note, a copy of which Request for Commitment is attached hereto as Exhibit C. "Redemption Price" shall mean, with respect to the Series 2002 Note or portion thereof, the principal amount or portion thereof payable upon redemption thereof pursuant to the Series 2002 Note or this Resolution. "Series 2002 Note" shall mean the Issuer's Monroe County, Florida Solid Waste Disposal System Refunding Revenue Note, Series 2002, authorized pursuant to Section 2.01 hereof. "State" shall mean the State of Florida. "Supplemental Resolution" shall mean any resolution of the Issuer amending or supplementing this Resolution adopted and becoming effective in accordance with the terms of Section 6.01 hereof. "System" shall mean any and all solid waste collection, disposal and management facilities (including landfills, construction demolition debris disposal sites, collection facilities and transfer stations and recycling facilities) now owned or hereafter owned by the Issuer, which System shall also include any and all improvements, extensions and additions thereto hereafter constructed or acquired either from the proceeds of any indebtedness issued by the Issuer or from any other sources, together with all property, real or personal, tangible 5 or intangible, now or hereafter owned or used in connection therewith, including all contractual rights and rights to capacity associated therewith. "Test Period" shall mean, as of the date of determination thereof, the immediately preceding twelve (12) month period. The terms "herein," "hereunder," "hereby," "hereto," "hereof," and any similar terms, shall refer to this Resolution; the term "heretofore" shall mean before the date of adoption of this Resolution; and the term "hereafter" shall mean after the date of adoption of this Resolution. Words importing the masculine gender include every other gender. Words importing the singular number include the plural number, and vice versa. SECTION 1.02. AUTHORITY FOR RESOLUTION. This Resolution is adopted pursuant to the provisions of Chapter 125, Florida Statutes, the Monroe County Code and other applicable provisions of law. SECTION 1.03. RESOLUTION TO CONSTITUTE CONTRACT. In consideration ofthe purchase and acceptance of the Series 2002 Note by those who shall hold the same from time to time, the provisions of this Resolution shall be a part of the contract of the Issuer with the Holder of the Series 2002 Note and shall be deemed to be and shall constitute a contract between the Issuer and the Holder from time to time of the Series 2002 Note. The pledge made in this Resolution and the provisions, covenants and agreements herein set forth to be performed by or on behalf of the Issuer shall be for the equal benefit, protection and security of the Holder of the Series 2002 Note. SECTION 1.04. FINDINGS. It is hereby ascertained, determined and declared that: (A) The Issuer now owns, operates and maintains the System for the collection, disposal and management of solid waste for the protection, health and well-being of its residents. (B) There has previously been issued the Refunded Bonds of which $5,660,000 currently remains outstanding. (C) The Issuer can achieve debt service savings through the issuance ofthe Series 2002 Note and the refunding of the Refunded Bonds. 6 (D) That pursuant to the Request for Commitment the Issuer requested proposals from financial institutions to provide the Issuer with a loan in an amount not to exceed $6,000,000, the proceeds of which would be applied for the principal purpose of current refunding the Refunded Bonds in order to achieve certain debt savings. (E) That the Bid Proposal submitted by SunTrust Bank was the most beneficial proposal to provide such loan. (F) The principal of and interest on the Series 2002 Note will be payable solely from the Pledged Revenues as provided herein and the estimated Pledged Revenues will be sufficient to pay the principal of and interest on the Series 2002 Note, as the same becomes due and all other payments provided for in the Resolution. (G) The Issuer shall never use or be required to use any ad valorem taxes for the payment of the Series 2002 Note. The Series 2002 Note shall not constitute a direct obligation of the Issuer or a pledge of its faith and credit, nor shall the Series 2002 Noteholder have any lien or encumbrance on any property in the Issuer, other than the Pledged Revenues. (H) Due to the potential volatility of the market for tax-exempt obligations such as the Series 2002 Note and the complexity of the transactions relating to such Series 2002 Note, it is in the best interest of the Issuer to issue the Series 2002 Note pursuant to Section 218.385(1), Florida Statutes. The Issuer acknowledges receipt of the information required by Section 218.385, Florida Statutes, in connection with such sale of the Series 2002 Note, including a "Truth-In-Bonding" statement. The aforementioned information is set forth in the copy of the letter of Sun Trust Bank attached hereto as Exhibit A. (I) It is not reasonably anticipated that more than $10,000,000 of tax-exempt obligations as defined under Section 265(b)(3) of the Code will be issued by the Issuer in calendar year 2002. SECTION 1.05. ACCEPTANCE OF BID PROPOSAL. The Issuer hereby accepts the Bid Proposal of SunTrust Bank to provide financing for the refunding of the Refunded Bonds. SECTION 1.06. AUTHORIZA TION OF REFUNDING OF REFUNDED BONDS. The Issuer hereby authorizes the refunding, on a current basis, of the Refunded Bonds. 7 ARTICLE II AUTHORIZATION, TERMS, EXECUTION AND REGISTRATION OF THE SERIES 2002 NOTE SECTION 2.01. AUTHORIZATION OF THE SERIES 2002 NOTE. This Resolution creates an obligation of the Issuer in the aggregate principal amount of $4,143,945.49 to be designated as "Monroe County, Florida Solid Waste Disposal System Refunding Revenue Note, Series 2002." The Series 2002 Note shall be issued in the aggregate principal amount of $4,143,945.49, shall be dated as of December 19,2002 and shall mature on October 1, 20 11, subject to optional and mandatory prepayment prior to maturity as described herein. The Series 2002 Note shall be issued as one fully registered Series 2002 Note in the denomination of $4,143,945.49 and shall bear interest from December 19,2002, at the Interest Rate (calculated on the basis of a 360-day year consisting of twelve 30-day months), payable semi-annually on April I and October I of each year, commencing April I, 2003. The Interest Rate may be adjusted pursuant to Section 2.07 herein. Such Interest Rate complies with and shall comply in all respects with the maximum interest rate provisions of Section 215.84, Florida Statutes. The Series 2002 Note shall be priced at 100% of its aggr:egate principal amount. The Series 2002 Note shall be payable as to principal, Redemption Price, if applicable, and interest by check or draft of the Issuer mailed to the Registered Owner of the Series 2002 Note as evidenced on the registration books maintained by the Issuer as of the close of business on the fifth business day next preceding an interest payment date; provided, that payments on the Series 2002 Note may be payable by bank wire transfer upon the request ofthe registered owner thereof. In the event that such payments are received by the Registered Owner more than ten (10) days after the scheduled payment date, a late payment fee equal to five percent (5%) of the past due amount shall be due and payable from the Issuer to the Registered Owner. Promptly following the final payment of the principal of the Series 2002 Note the Registered Owner shall provide the Issuer with evidence of cancellation of the Series 2002 Note. Principal of and interest on the Series 2002 Note shall be payable in any coin or currency of the United States of America which, on the date of maturity of the Series 2002 Note, are legal tender for the payment of public and private debts. SECTION 2.02. APPLICATION OF SERIES 2002 NOTE PROCEEDS; TRANSFER OF CERTAIN MONEYS. The proceeds derived from the sale of the Series 2002 Note and premium, if any, and certain other legally available moneys of the Issuer, shall, simultaneously with the delivery of the Series 2002 Note to the purchaser thereof, be applied by the Issuer as follows: 8 (A) A sufficient amount ofthe Series 2002 Note proceeds shall be deposited to an escrow deposit trust fund established under the terms and provisions of the Escrow Deposit Agreement and shall be invested in Federal Securities in the manner set forth in such Escrow Deposit Agreement, which investments shall mature at such times and in such amounts as shall be sufficient to pay the principal of, premium, if any, and interest on the Refunded Bonds as the same mature or are redeemed. (B) A sufficient amount of the Series 2002 Note proceeds shall be applied to the payment of costs and expenses relating to the issuance of the Series 2002 Note. (C) The balance, if any, of the Series 2002 Note proceeds shall be deposited in the Sinking Fund and shall be applied to the payment of interest on the Series 2002 Note. (D) Any excess moneys on deposit in the funds and accounts established for the Refunded Bonds under the Refunded Bonds Resolution shall be transferred to the escrow deposit trust fund established pursuant to the Escrow Deposit Agreement. SECTION 2.03. EXECUTION OF THE SERIES 2002 NOTE. The Series 2002 Note shall be executed in the name of the Issuer with the manual signature ofthe Mayor and the official seal of the Issuer shall be imprinted thereon, attested and countersigned with the manual signature of the Clerk. In case anyone or more of the officers who shall have signed or sealed the Series 2002 Note shall cease to be such officer ofthe Issuer before the Series 2002 Note so signed and sealed has been actually sold and delivered, the Series 2002 Note may nevertheless be sold and delivered as herein provided and may be issued as if the person who signed or sealed the Series 2002 Note had not ceased to hold such office. The Series 2002 Note may be signed and sealed on behalf of the Issuer by such person who at the actual time of the execution of the Series 2002 Note shall hold the proper office of the Issuer, although at the date of the Series 2002 Note such person may not have held such office or may not have been so authorized. SECTION 2.04. SERIES 2002 NOTE MUTILATED, DESTROYED, STOLEN OR LOST. In case the Series 2002 Note shall become mutilated, or be destroyed, stolen or lost, the Issuer shall issue and deliver a new Series 2002 Note of like tenor as the Series 2002 Note so mutilated, destroyed, stolen or lost, in exchange and substitution for the mutilated Series 2002 Note upon surrender and cancellation of such mutilated Series 2002 Note orin lieu of and substitution for the Series 2002 Note destroyed, stolen or lost, and upon the Holder furnishing the Issuer proof of his ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer may prescribe and paying such expenses as the Issuer may incur. The Series 2002 Note so surrendered or otherwise substituted shall be cancelled by the Issuer. If the Series 2002 Note 9 shall have matured or be about to mature, instead of issuing a substitute Series 2002 Note, the Issuer may pay the same or cause the Series 2002 Note to be paid, upon being indemnified as aforesaid, and if the Series 2002 Note is lost, stolen or destroyed, without surrender thereof. SECTION 2.05. REGISTRATION OF SERIES 2002 NOTE. So long as the Series 2002 Note remains outstanding, the Issuer shall maintain and keep the address of the Registered Owner of the Note. The Issuer may deem and treat the person in whose name the Series 2002 Note shall be registered as the absolute owner of the Series 2002 Note, whether the Series 2002 Note shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the Series 2002 Note and for all other purposes, and all such payments so made to any such Registered Owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon the Series 2002 Note to the extent of the sum or sums so paid, and the Issuer shall not be affected by any notice to the contrary. The transfer of the Series 2002 Note shall be registrable only upon the books of the Issuer, at the office of the Clerk, under such reasonable regulations as the Issuer may prescribe, by the Registered Owner thereof in person or by his attorney duly authorized in writing upon surrender thereof together with a written instrument of transfer satisfactory to the Clerk duly executed and guaranteed by the Registered Owner or his duly authorized attorney. Upon the registration of transfer of the Series 2002 Note, the Issuer shall issue in the name of the transferee a new Note of the same principal amount and maturity as the surrendered Series 2002 Note. For every such registration of transfer, the Issuer may charge the registered owner a reasonable amount to reimburse it for any tax, fee, expense or other governmental charge (other than a charge imposed by the Issuer) required to be paid with respect to such transfer. SECTION 2.06. DESIGNATION OF THE SERIES 2002 NOTE AS A QUALIFIED TAX-EXEMPT OBLIGATION. The Issuer hereby designates the Series 2002 Note as a "qualified tax-exempt obligation" under Section 265(b )(3) of the Code. This designation is based upon the findings of the Issuer set forth in Section 1.04(1) hereof and the Mayor or the Clerk is authorized to certify such finding upon the issuance of the Series 2002 Note. SECTION 2.07. ADJUSTMENTS TO INTEREST RATE. (A) If for any reason it shall be determined that the Series 2002 Note is not a "qualified tax-exempt obligation" within the meaning of Section 265(b )(3) of the Code, then the Interest Rate thereon shall be adjusted to such rate as shall provide the Series 2002 Noteholder with the 10 same rate of return that the Series 2002 Noteholder would have otherwise received on the Series 2002 Note taking into account the diminished deductibility of interest expense of the Series 2002 Noteholder under Section 265 ofthe Code as a result of the non "qualified tax- exempt obligation" status of the Note; provided, however, such increased rate shall never exceed the maximum rate allowable by law. The Series 2002 Noteholder shall provide the Issuer with sufficient evidence supporting any such increase. (B) In the event of a Determination of Taxability, the Interest Rate on the Series 2002 Note shall be increased to a rate per annum equal to the Interest Rate times 1.54 (the "Taxable Rate") effective retroactively to the date on which such Determination of Taxability was made. Immediately upon a Determination of Taxability, the Issuer agrees to pay to the Holder of the Series 2002 Note subject to such Determination of Taxability the Additional Amount (as defined herein). "Additional Amount" means (i) the difference between (a) interest on the Series 2002 Note for the period commencing on the date on which the interest on such Series 2002 Note (or portion thereof) loses its tax-exempt status and ending on the earlier of the date such Series 2002 Note ceased to be outstanding or such adjustment is no longer applicable to such Series 2002 Note (the "Taxable Period") at a rate per annum equal to the Taxable Rate, and (b) the aggregate amount of interest payable on such Series 2002 Note for the Taxable Period under the provisions of such Series 2002 Note without considering the Determination of Taxability, plus (ii) any penalties and interest paid or payable by such Series 2002 Noteholder to the Internal Revenue Service by reason of such Determination of Taxability. (C) The Series 2002 Noteholder shall promptly notify the Issuer in writing of any adjustments pursuant to this Section 2.07. Such adjustments shall become effective as of the effective date of the event causing such adjustment. Adjustments pursuant to this Section 2.07 may be retroactive. The Series 2002 Noteholder shall certify to the Issuer in writing the additional amount, if any, due to the Series 2002 Noteholder as a result of an adjustment pursuant to this Section 2.07. Notwithstanding any provision of this Section 2.07 to the contrary, in no event shall the Interest Rate on the Series 2002 Note exceed the maximum rate permitted by law. (D) The provisions set forth in this Section 2.07 shall survive payment of the Series 2002 Note until such time as the federal statute oflimitations under which the interest on the Series 2002 Note could be declared taxable under the Code shall have expired. SECTION 2.08. FORM OF THE SERIES 2002 NOTE. The text of the Series 2002 Note shall be in substantially the following form with such omissions, insertions and variations as may be necessary or desirable and approved by the Mayor, the County Attorney, the County Administrator or the Clerk prior to the issuance thereof (which necessity or 11 desirability and approval shall be presumed by such officer's execution of the Series 2002 Note and the Issuer's delivery of the Series 2002 Note to the purchaser thereof): [Remainder of page intentionally left blank] 12 $4,143,945.49 UNITED STATES OF AMERICA STATE OF FLORIDA MONROE COUNTY, FLORIDA SOLID WASTE DISPOSAL SYSTEM REFUNDING REVENUE NOTE, SERIES 2002 Interest Rate Maturity Date Date of Original Issue 3.41 % October 1,2011 December 19, 2002 Registered Holder: SUNTRUST BANK Principal Amount: FOUR MILLION ONE HUNDRED FORTY-THREE THOUSAND NINE HUNDRED FORTY-FIVE AND 49/100 DOLLARS Monroe County, Florida, a political subdivision of the State of Florida (the "Issuer"), for value received, hereby promises to pay, solely from the funds hereinafter described, to the Registered Holder identified above, or registered assigns as hereinafter provided, on the Maturity Date identified above, subject to prior mandatory redemption as provided herein, the Principal Amount identified above and to pay interest on such Principal Amount from the Date of Original Issue identified above or from the most recent payment date to which interest has been paid at the Interest Rate per annum set forth and described in the hereinafter defined Resolution on April I and October I of each year commencing April I, 2003, until such Principal Amount shall have been paid, except as the provisions hereinafter set forth with respect to redemption prior to maturity may be or become applicable hereto. Such Principal Amount and interest on this Series 2002 Note are payable in any coin or currency of the United States of America which, on the respective dates of payment thereof, shall be legal tender for the payment of public and private debts. Payment of each installment of principal and interest shall be made to the person in whose name this Series 2002 Note shall be registered on the registration books ofthe Issuer, at the close of business on the date which shall be the fifth business day next preceding each payment date and shall be paid by a check or draft of the Issuer mailed to such Registered Holder at the address appearing on such registration books or, at the request and expense of such Registered Holder, by bank wire transfer for the account of such Holder. In the event that such payments are received by the Registered Holder more than ten (10) days after the scheduled 13 payment, a late payment fee equal to five percent (5%) of the past due amount shall be due and payable from the Issuer to the Registered Holder. Promptly following the final payment of the principal of the Series 2002 Note the Registered Holder shall provide the Issuer with evidence of cancellation of the Series 2002 Note. All payments must be made to the Registered Holder in immediately available funds, free and clear of any defenses, set offs, counterclaims, or withholdings or deductions for taxes. The interest rate on this Series 2002 Note may be adjusted as provided in the hereinafter described Resolution. This Series 2002 Note is issued for the principal purpose of (A) refunding, on a current basis, the Monroe County Municipal Service District Refunding Improvement Bonds, Series 1991, as more particularly described in the hereinafter defined Resolution, and (B) paying costs and expenses of issuing the Series 2002 Note. The Series 2002 Note is being issued under the authority of and in full compliance with the Constitution and laws of the State of Florida, particularly Chapter 125, Florida Statutes, and other applicable provisions oflaw (collectively, the "Act"), and a resolution duly adopted by the County Commission of the Issuer on December 18, 2002 (the "Resolution"), and is subject to all the terms and conditions of the Resolution. The Series 2002 Note and the interest hereon are payable from and secured by a lien upon and a pledge of (1) the Gross Revenues (as defined in the Resolution) to be derived from the operation of the Issuer's solid waste disposal, collection and management system, and (2) until applied in accordance with the provisions of this Resolution, all moneys, including investments thereof, in the funds and accounts established under the Resolution (collectively, the "Pledged Revenues"). IT IS EXPRESSLY AGREED BY THE REGISTERED HOLDER OF THIS SERIES 2002 NOTE THAT THE FULL FAITH AND CREDIT OF THE ISSUER, THE STATE OF FLORIDA, OR ANY POLITICAL SUBDIVISION OR AGENCY THEREOF, ARE NOT PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF, PREMIUM, IF ANY, AND INTEREST ON THIS SERIES 2002 NOTE AND THAT SUCH HOLDER SHALL NEVER HAVE THE RIGHT TO REQUIRE OR COMPEL THE EXERCISE OF ANY TAXING POWER OF THE ISSUER, THE STATE OF FLORIDA, OR ANY POLITICAL SUBDIVISION OR AGENCY THEREOF, TO THE PAYMENT OF SUCH PRINCIPAL, PREMIUM, IF ANY, AND INTEREST. THIS SERIES 2002 NOTE AND THE OBLIGATION EVIDENCED HEREBY SHALL NOT CONSTITUTE A LIEN UPON ANY PROPERTY OF THE ISSUER, BUT SHALL CONSTITUTE A LIEN ONLY ON, AND 14 SHALL BE PAYABLE SOLELY FROM, THE PLEDGED REVENUES TO THE EXTENT PROVIDED IN THE RESOLUTION. THE ISSUER MAY ISSUE ADDITIONAL OBLIGATIONS ON P ARlTY WITH THE SERIES 2002 NOTE IN ACCORDANCE WITH THE TERMS OF THE RESOLUTION. The Series 2002 Note may be prepaid at the option of the Issuer, from any moneys legally available therefor, upon notice as provided in the Resolution and described below, in whole or in part at any time or from time to time, without penalty or premium, by paying to the Registered Holder hereof all or part of the principal amount of the Series 2002 Note to be prepaid, together with the unpaid interest accrued on the amount of principal so prepaid to the date of such prepayment. In the event any portion of the Series 2002 Note is optionally prepaid, the amount so prepaid shall be applied as a credit against the latest scheduled amortization installment as set forth below. The Series 2002 Note is subject to mandatory prepayment prior to maturity at a Redemption Price equal to the principal amount thereof, plus accrued interest thereon to the date fixed for prepaYment, on October 1 of each year, without premium, as follows: Amortization Date October 1,2003 October 1,2004 October I, 2005 October I, 2006 October 1, 2007 October 1,2008 October 1, 2009 October I, 2010 October 1,2011 * *Final maturity. Principal Amount $ 323,086.79 423,468.48 437,908.75 452,841.44 468,283.34 484,251.80 500,764.79 517,840.86 535,499.24 Optional prepayment of the Series 2002 Note shall be made as provided in the Resolution upon notice given by first class mail sent at least ten (10) days prior to the prepayment date. In the event that less than the full principal amount hereof shall have been called for optional prepayment, the Registered Holder hereof shall make a notation on the Series 2002 Note indicating the amount and date of such prepayment and shall promptly transmit an acknowledgment to the Issuer indicating the amount and date of such prepayment and the amount and date of the next scheduled payment. 15 Reference to the Resolution and any and all resolutions supplemental thereto, and modifications and amendments thereof, and to the Act is made for a description of the pledge securing the Series 2002 Note, the nature, manner and extent of enforcement of such pledge, and the rights, duties, immunities and obligations of the Issuer. It is hereby certified and recited that all acts, conditions and things required to exist, to happen and to be performed precedent to and in the issuance of the Series 2002 Note, exist, have happened and have been performed, in regular and due form and time as required by the laws and Constitution of the State of Florida applicable thereto, and that the issuance of the Series 2002 Note does not violate any constitutional or statutory limitations or provIsIOns. Neither the members of the Board of County Commissioners of the Issuer nor the Mayor nor the Clerk nor any person executing the Series 2002 Note shall be liable personally hereon or be subject to any personal liability or accountability by reason of the issuance hereof. IN WITNESS WHEREOF, Monroe County, Florida has issued this Series 2002 Note and has caused the same to be executed by the manual signature of the Mayor of its Board of County Commissioners and countersigned and attested to by the manual signature of the Clerk of such Board, and its official seal to be affixed hereon, all as of the Date of Original Issue. MONROE COUNTY, FLORIDA (SEAL) Mayor, Board of County Commissioners ATTESTED AND COUNTERSIGNED: Clerk, Board of County Commissioners APPROVED AS TO FORM AND LEGAL SUFFICIENCY: County Attorney's Office 16 ARTICLE III PREPAYMENT OF THE SERIES 2002 NOTE SECTION 3.01. OPTIONAL PREPAYMENT. The Series 2002 Note may be prepaid at the option of the Issuer, from any moneys legally available therefor, upon notice as provided herein, in whole or in part at any time or from time to time, without penalty or premium, by paying to the Holder all or part ofthe principal amount of the Series 2002 Note to be prepaid, together with the unpaid interest accrued on the amount of principal so prepaid to the date of such prepayment. In the event any portion ofthe Series 2002 Note is optionally prepaid pursuant to this Section 3.01, the amount so prepaid shall be applied as a credit against the latest scheduled amortization installment as set forth in Section 3.02 hereof. The Holder shall make a notation on the Series 2002 Note indicating the amount and date of such prepayment and shall promptly transmit an acknowledgment to the Issuer indicating the amount and date of such prepayment and the amount and date of the next scheduled payment. Notice of such optional prepayment, which shall specify the principal amount to be prepaid and the date for prepayment, shall be given by the Issuer, and shall be mailed first class, postage prepaid, at least ten (IO) days prior to the prepayment date to the Holder of Series 2002 Note at its address as it appears on the registration books kept by the Issuer as of the date of mailing of such notice. [Remainder of page intentionally left blank] 17 SECTION 3.02. MANDATORY PREPAYMENT. The Series 2002 Note is subject to mandatory sinking fund prepayment prior to maturity at a Redemption Price equal to the principal amount thereof, plus accrued interest thereon to the date fixed for prepayment, on October 1, 2003, and thereafter on each October 1, without premium, as follows: Amortization Date October 1, 2003 October 1,2004 October I, 2005 October 1, 2006 October 1, 2007 October 1, 2008 October I, 2009 October I, 20 I 0 October 1, 2011* *Final maturity. Principal Amount $ 323,086.79 423,468.48 437,908.75 452,841.44 468,283.34 484,251.80 500,764.79 517,840.86 535,499.24 SECTION 3.03. PAYMENT OF PREPAID SERIES 2002 NOTE. Notice of optional prepayment having been given as provided in Section 3.01 hereof, the Series 2002 Note or a portion of the Series 2002 Note so to be prepaid shall, on the prepayment date, become due and payable at the Redemption Price therein specified, and from and after such date as the Holder actually receives such prepayment, the Series 2002 Note or portion thereof shall cease to bear interest. [Remainder of page intentionally left blank] 18 ARTICLE IV SECURITY; DEBT SERVICE FUND; COVENANTS OF THE ISSUER SECTION 4.01. SERIES 2002 NOTE NOT TO BE INDEBTEDNESS OF ISSUER. The Series 2002 Note shall not be or constitute a general obligation or indebtedness of the Issuer as a "bond" within the meaning of any constitutional or statutory provision, but shall be a special obligation of the Issuer, payable from and secured by a lien upon and pledge of the Pledged Revenues in accordance with the terms of this Resolution. No Holder of the Series 2002 Note shall ever have the right to compel the exercise of any ad valorem taxing power to pay such Series 2002 Note, or be entitled to payment of the Series 2002 Note from any moneys of the Issuer, except from the Pledged Revenues, in the manner provided herein. SECTION 4.02. SECURITY FOR THE SERIES 2002 NOTE. The payment of the principal of or Redemption Price, if applicable, and interest on the Series 2002 Note shall be secured forthwith equally and ratably by a pledge of and lien upon the Pledged Revenues. The Issuer does hereby irrevocably pledge the Pledged Revenues to the payment of the principal of or Redemption Price, if applicable, and interest on the Series 2002 Note in accordance with the provisions hereof. Except as otherwise provided herein, the Pledged Revenues shall immediately be subject to the lien of this pledge without any physical delivery thereof or further act, and the lien of this pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Issuer. SECTION 4.03. CREATION OF FUNDS AND ACCOUNTS. The Issuer covenants and agrees to establish the following funds and accounts: (A) the "Monroe County, Florida Solid Waste Disposal System Revenue Fund," (B) the "Monroe County, Florida Solid Waste Disposal System Operation and Maintenance Fund," (C) the "Monroe County, Florida Solid Waste Disposal System Sinking Fund." Moneys in the aforementioned Sinking Fund, until applied in accordance with the provisions hereof, shall be held in trust for and be subject to a lien and charge in favor of the Holder of the Series 2002 Note and for the further security of such Holders. 19 The Issuer may at any time and from time to time appoint one or more depositories to hold, for the benefit of the Holder of the Series 2002 Note, anyone or more of the funds and accounts established hereunder. Such depositary or depositories shall perform at the direction of the Issuer the duties of the Issuer in depositing, transferring and disbursing moneys to and from such fund as herein set forth, and all records of such depositary in performing such duties shall be open at all reasonable times to inspection by the Issuer and its agent and employees. Any such depositary shall be a bank or trust company duly authorized to perform such responsibilities pursuant to applicable law. SECTION 4.04. DISPOSITION OF REVENUES. (A) Except as otherwise provided by Section 4.08 hereofwith respectto investment income, the Issuer shall deposit promptly into the Revenue Fund, as received, all Gross Revenues. (B) Moneys in the Revenue Fund shall be disposed of by the Issuer on or before the twenty- fifth (25th) day of each month, commencing in the month immediately following the delivery of the Series 2002 Note to the Holder thereof, or such later date as hereinafter provided, in the following manner and in the following order of priority: (1) Sinking Fund - Interest. The Issuer shall deposit or credit to the Sinking Fund the sum which, together with the balance allocated to pay interest in said Fund, shall equal the interest on the Series 2002 Note accrued and unpaid and to accrue to the end of the then current calendar month. No further deposit need be made to the Sinking Fund for interest when the moneys therein allocated to pay interest are equal to the interest coming due on the Series 2002 Note on the next succeeding interest payment date. (2) Sinking Fund - Principal. Commencing in the month following the issuance of the Series 2002 Note, the Issuer shall next deposit into the Sinking Fund the sum which, together with the balance allocated to pay the principal or mandatory sinking fund prepayment amount in said Fund, shall equal the principal amount or mandatory sinking fund prepayment amount ofthe Series 2002 Note due and unpaid and that portion of the principal or mandatory sinking fund prepayment amount next due which would have accrued on such Bonds through the end of the then current calendar month if such principal amounts or mandatory sinking fund prepayment amounts were deemed to accrue monthly (assuming that a year consists of twelve (12) equivalent calendar months having thirty (30) days each) in equal amounts from the next preceding payment due date (or issue date), or, if there be no such preceding payment due date, from a date one year preceding the due date of such principal 20 amount or mandatory sinking fund prepayment amount. No further deposit need be made to the Sinking Fund for principal or mandatory sinking fund prepayment amount when the moneys therein are equal to the principal or mandatory sinking fund prepayment amount coming due on the Outstanding Bonds on the next succeeding payment date. (3) Operation and Maintenance Fund. Moneys in the Revenue Fund shall next be used each month to deposit in the Operation and Maintenance Fund such sums as are necessary to pay Operating Expenses for the ensuing month. Amounts in the Operation and Maintenance Fund shall be paid out from time to time by the Issuer for Operating Expenses. (4) Surplus Funds. The balance of any Gross Revenues remaining in said Revenue Fund may be applied for any lawful purpose, including, but not limited to, purchase or redemption of the Series 2002 Note, payment of subordinated indebtedness and improvements, renewals and replacements to the System; provided, however, that none of such revenues shall ever be used for the purposes provided herein unless all paYments required in Sections 4. 04(B)(1 ) through 4. 04(B )(3) hereof, including any deficiencies for prior payments, have been made in full to the date of such use. (C) Whenever moneys on deposit in the Sinking Fund are sufficient to fully pay the Series 2002 Note in accordance with its terms (including principal or applicable Redemption Price and interest thereon), no further deposits to the Sinking Fund need be made. If on any payment date the Gross Revenues are insufficient to deposit the required amount in any of the funds or accounts or for any of the purposes provided above, the deficiency shall be made up on the subsequent payment dates. The Issuer, in its discretion, may use moneys in the Sinking Fund to purchase or redeem the portion of the Series 2002 Note coming due on the next payment date, provided such purchase or redemption does not adversely affect the Issuer's ability to pay the principal or interest coming due on such payment date on the Bonds not so purchased or redeemed. SECTION 4.05. PAYMENT OF THE SERIES 2002 NOTE. Except as otherwise provided in Section 4.11 hereof, the Issuer hereby agrees to pay, solely from Pledged Revenues, on the dates designated for payment of any principal of or Redemption Price, if applicable, or interest on the Series 2002 Note, sufficient monies to pay such principal or Redemption Price, if applicable, or interest. The Issuer shall utilize such monies for payment of the principal of or Redemption Price and interest on the Series 2002 Note when due. 21 SECTION 4.06. REBATE ACCOUNT. The Issuer covenants and agrees to establish a special rebate account if it is determined that the Issuer has any rebate obligations under the Code. Amounts on deposit in such account, if any, shall be held in trust by the Issuer and used solely to make required rebates to the United States (except to the extent the same may be transferred to the Issuer) and the Series 2002 Noteholder shall have no right to have the same applied for debt service on the Series 2002 Note. The Issuer agrees to undertake all actions required of it in its arbitrage certificate related to the Series 2002 Note, including, but not limited to: (A) making a determination in accordance with the Code of the amount required to be deposited in the rebate account; (B) depositing the amount determined in clause (A) above into the rebate account; (C) paying on the dates and in the mannerrequired by the Code to the United States Treasury from the rebate account and any other legally available moneys of the Issuer such amounts as shall be required by the Code to be rebated to the United States Treasury; and (D) keeping such records of the determinations made pursuant to this Section 4.06 as shall be required by the Code, as well as evidence of the fair market value of any investments purchased with proceeds of the Series 2002 Note. The provisions of the above-described arbitrage certificate may be amended without the consent of any Holder from time to time as shall be necessary, in the opinion of Bond Counsel, to comply with the provisions of the Code. SECTION 4.07. SEPARATE ACCOUNTS. The moneys required to be accounted for in each of the foregoing funds, accounts and subaccounts established herein may be deposited in a single, non- exclusive bank account, and funds allocated to the various funds, accounts and subaccounts established herein may be invested in a common investment pool, provided that adequate accounting records are maintained to reflect and control the restricted allocation of the moneys on deposit therein and such investments for the various purposes of such funds, accounts and subaccounts as herein provided. The designation and establishment ofthe various funds, accounts and subaccounts in and by this Resolution 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 for certain purposes and to establish certain priorities for application of such revenues as herein provided. 22 The Issuer shall be authorized to establish any separate accounts within any of the Funds created herein or subaccounts within any such accounts that the Issuer may determine is beneficial or desirable in administering the moneys on deposit herein. SECTION 4.08. INVESTMENTS. Moneys on deposit in the Sinking Fund, the Operation and Maintenance Fund and the Revenue Fund shall be continuously secured in the manner by which the deposit of public funds are authorized to be secured by the laws of the State. Moneys on deposit in the Sinking Fund, the Operation and Maintenance Fund and the Revenue Fund may be invested and reinvested in Authorized Investments maturing not later than the date on which the moneys therein will be needed for the purposes of such fund. All investments shall be valued at cost. All such investments shall be valued at their fair market value. Any and all income received by the Issuer from the investment of moneys in any Fund shall be retained in such Fund. Nothing in this Resolution shall prevent any Authorized Investments acquired as investments of or security for funds held under their Resolution from being issued or held in book-entry form on the books of the Department of Treasury of the United States. SECTION 4.09. FEDERAL INCOME TAX COVENANTS. The Issuer covenants with the Holder of the Series 2002 Note that it shall not use the proceeds of the Series 2002 Note in any manner which would cause the interest on the Series 2002 Note to be included in gross income for purposes of federal income taxation. The Issuer covenants with the Series 2002 Noteholder that neither the Issuer nor any person under its control or direction will make any use of the proceeds of the Series 2002 Note (or amounts deemed to be proceeds under the Code) in any manner which would cause the Series 2002 Note to be an "arbitrage bond" within the meaning of Section 148 of the Code and neither the Issuer nor any other person shall do any act or fail to do any act which would cause the interest on the Series 2002 Note to be included in gross income for purposes of federal income taxation. The Issuer hereby covenants with the Series 2002 Noteholder that it will comply with all provisions of the Code necessary to maintain the exclusion of interest on the Series 2002 Note from gross income for purposes of federal income taxation, including, in particular, the payment of any amount required to be rebated to the U. S. Treasury pursuant to the Code. SECTION 4.10. ANNUAL AUDIT AND BUDGET. The Issuer shall, immediately after the close of each Fiscal Year, cause the financial statements of the Issuer 23 to be properly audited by a recognized independent certified public accountant or recognized independent firm of certified public accountants, and shall require such accountants to complete their report on the annual financial statements in accordance with applicable law. The annual financial statements shall be prepared in conformity with generally accepted accounting principles consistently applied. A copy of the audited financial statements for each fiscal Year shall be furnished to the Series 2002 Noteholder within 210 days after the end of each Fiscal Year. The Issuer shall also provide the Series 2002 Noteholder each Fiscal Year with a copy of its annual budget within 60 days after the final adoption of such budget. SECTION 4.11. OTHER MONEYS. The Issuer may, in its sole discretion, utilize other legally available moneys, in addition to the Pledged Revenues, to pay the principal of and interest on the Series 2002 Note. SECTION 4.12. ADDITIONAL DEBT. So long as the Series 2002 Note is outstanding under this Resolution, the Issuer covenants and agrees that it shall not issue any debt obligations on parity with the Series 2002 Note and payable from the Pledged Revenues or any portion thereof unless the Net Revenues received by the Issuer during any twelve consecutive months within the eighteen months immediately preceding the date of sale of such debt obligations were equal to at least 135% of the Maximum Annual Debt Service taking into account the proposed debt obligations. The Issuer shall provide the Series 2002 Noteholder with a certification executed by the Clerk or the County Administrator evidencing compliance with this Section 4.12 prior to the issuance of any such debt obligations. SECTION 4.13. SYSTEM RATES. The Issuer shall fix, establish and maintain such rates and collect such fees, rates, assessments or other charges for the product, services and facilities of its System, and revise the same from time to time, whenever necessary, as will always provide in each Fiscal Year, Net Revenues adequate at all times to pay in each Fiscal Year at least one hundred thirty-five percent (135%) of the principal (including any mandatory sinking fund prepayment amounts) and interest on the Series 2002 Note which is due in such Fiscal Year. Such rates, fees and other charges shall not be so reduced so as to be insufficient to provide adequate Net Revenues for the purposes provided therefor by this Resolution. If, in any Fiscal Year, the Issuer shall fail to comply with the requirements contained in this Section 4.13, it shall engage the Consulting Engineers and cause the Consulting Engineers to review its rates, fees, charges, income, Gross Revenue, Operating Expenses and methods of operation and to make written recommendations as to the methods by which the Issuer may promptly seek to comply with the requirements set forth in this Section 4.13. The Issuer shall forthwith commence to implement such recommendations to the extent required 24 so as to cause it to thereafter comply with said requirements. So long as the Issuer implements such recommendations and the Net Revenues are adequate to pay the principal (including mandatory sinking fund payments) and interest on the Series 2002 Note it shall not constitute a Default hereunder. SECTION 4.14. AUTHORIZATION TO EXECUTE ESCROW DEPOSIT AGREEMENT. The Issuer hereby authorizes the Mayor to execute and the Clerk to attest an Escrow Deposit Agreement (the "Escrow Deposit Agreement") and to deliver the Escrow Deposit Agreement to The Bank ofN ew York Trust Company of Florida, N .A., Jacksonville, Florida, which is hereby appointed as escrow agent thereunder (the "Escrow Agent"). All of the provisions of the Escrow Deposit Agreement when executed and delivered by the Issuer as authorized herein and when duly authorized, executed and delivered by the Escrow Agent, shall be deemed to be a part of this Resolution as fully and to the same extent as if incorporated verbatim herein, and the Escrow Deposit Agreement shall be in substantially the form attached hereto as Exhibit D, with such changes, amendments, modifications, omissions and additions, including the date of such Escrow Deposit Agreement, as may be approved by the Mayor. Execution by the Mayor of the Escrow Deposit Agreement shall be deemed to be conclusive evidence of approval of such changes. SECTION 4.15. CONSTRUCTION, OPERATION AND MAINTENANCE. The Issuer will maintain or cause to be maintained the System and all portions thereof in good condition and will operate or cause to be operated the same in an efficient and economical manner, making or causing to be made such expenditures for equipment and for renewals, repairs and replacements as may be proper for the economical operation and maintenance thereof. The Issuer may contract with a responsible person which has experience in the operation of solid waste disposal systems similar to the System for the operation and maintenance of the System. SECTION 4.16. ENFORCEMENT OF CHARGES. The Issuer shall compel the prompt payment of rates, fees, assessments and charges imposed for the use of the services and facilities of the System, and to that end will vigorously enforce all of the provisions of any ordinance or resolution of the Issuer having to do with charges and control of the solid waste stream in the Issuer, and all of the rights and remedies permitted the Issuer under law, including the securing of injunction against the disposition of solid waste into the System by any premises delinquent in the payment of such charges. The Issuer shall cause all solid waste special assessments to be placed on the tax roll of the Monroe County Tax Collector. 25 ARTICLE V DEFAULTS AND REMEDIES SECTION 5.01. DEFAULTS DEFINED. The following shall be "Defaults" under this Resolution and the term "Default" shall mean, whenever it is used in this Resolution, anyone or more of the following events: (a) Failure by the Issuer to pay the principal of, Redemption Price, if applicable, and interest on the Series 2002 Note as the same shall become due and payable. (b) Failure by the Issuer to observe and perform any covenant, condition or agreement on its part to be observed or performed, other than as referred to in Section 5.01(a), for a period of thirty (30) days after written notice specifying such failure and requesting that it be remedied shall have been given to the Issuer by the Series 2002 Noteholder. Notwithstanding the foregoing, the Issuer shall not be deemed in default hereunder if such default can be cured within a reasonable period of time and if the Issuer in good faith institutes curative action and diligently pursues such action until the default has been corrected, provided such period shall not exceed 60 days without the written consent of the Series 2002 Noteholder. (c) The dissolution or liquidation of the Issuer, or the initiation by or against the Issuer of any proceeding under any federal or state law relating to bankruptcy, insolvency, arrangement, reorganization, readjustment of debt or any other form of debtor relief. SECTION 5.02. REMEDIES ON DEFAULT. The Holder of the Series 2002 Note issued under the provisions ofthis Resolution may either at law or in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdiction, protect and enforce any and all rights under the Laws of the State of Florida, or granted and contained in this Resolution, and may enforce and compel the performance of all duties required by this Resolution or by any applicable statutes to be performed by the Issuer or by any officer thereof; provided, however, that the Series 2002 Noteholder shall not have the right to declare the Series 2002 Note immediately due and payable. SECTION 5.03. REMEDIES CUMULATIVE. No remedy herein conferred upon or reserved to the Series 2002 Noteholder is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute. 26 SECTION 5.04. WAIVER OF DEFAULT. No delay or omission of the Series 2002 Noteholder to exercise any right or power accruing upon any Default shall impair any such right or power or shall be construed to be a waiver of any such Default, or an acquiescence therein; and every power and remedy given by this Section 5.04 hereof to the Series 2002 Noteholder may be exercised from time to time, and as often as may be deemed expedient. [Remainder of page intentionally left blank] 27 ARTICLE VI SUPPLEMENTAL RESOLUTIONS SECTION 6.01. SUPPLEMENTAL RESOLUTIONS WITH THE SERIES 2002 NOTEHOLDER CONSENT. The Issuer, from time to time and at any time, may adopt resolutions amendatory or supplemental hereto (which resolutions shall thereafter form a part hereof) for any purpose; provided, however, the Issuer must obtain the written consent of the Series 2002 Noteholder prior to the adoption thereof if any of the rights of the Series 2002 Noteholder will be adversely affected. [Remainder of page intentionally left blank] 28 ARTICLE VII MISCELLANEOUS SECTION 7.01. SERIES 2002 NOTE EVIDENCES A LOAN. The Series 2002 Note issued hereunder evidences a loan made by SunTrust Bank to the Issuer. Through its acceptance of the Series 2002 Note hereunder, SunTrust Bank acknowledges that it has no present intent to sell, assign or otherwise transfer the Series 2002 Note; provided, however, that SunTrust Bank may, in its sole discretion, sell, assign or otherwise transfer the Series 2002 Note prior to its maturity. In the event of such sale, assignment or other transfer ofthe Series 2002 Note, SunTrust Bank shall comply in all respects with all applicable securities laws, rules and regulations and blue sky laws and any other applicable laws, rules or regulations regarding disclosure and registration. SECTION 7.02. WAIVER OF JURY TRIAL. If any legal action is taken with respect to the Series 2002 Note or the Issuer's obligations hereunder, or SunTrust's commitment thereto, or any other transaction related to the Series 2002 Note, the Issuer and SunTrust Bank hereby waive their rights to jury trial. SECTION 7.03. GENERAL AUTHORITY. The members of the Board of County Commissioners of the Issuer and the officers, attorneys and other agents or employees of the Issuer are hereby authorized to do all acts and things required of them by this Resolution, or desirable or consistent with the requirements hereof for the full punctual and complete performance of all the terms, covenants and agreements contained herein or in the Series 2002 Note, and each member, employee, attorney and officer of the Issuer, the Mayor, the County Administrator, the County Attorney and the Clerk are hereby authorized and directed to execute and deliver any and all papers and instruments and to be and cause to be done any and all acts and things necessary or proper for carrying out the transactions contemplated hereunder. SECTION 7.04. SEVERABILITY OF INVALID PROVISIONS. If anyone or more of the covenants, agreements or provisions of this Resolution shall be held contrary to any express provision oflaw or contrary to the policy of express law, though not expressly prohibited, or against public policy, or shall for any reason whatsoever be held invalid, then such covenants, agreements or provisions shall be null and void and shall be deemed separable from the remaining covenants, agreements and provisions of this Resolution and shall in no way affect the validity of any of the other covenants, agreements or provisions hereof or of the Series 2002 Note issued hereunder. 29 SECTION 7.05. REPEAL OF INCONSISTENT RESOLUTIONS. All resolutions or parts thereof in conflict herewith are hereby superseded and repealed to the extent of such conflict. SECTION 7.06. EFFECTIVE DATE. This Resolution shall take effect immediately upon its adoption. Passed and adopted by the Board of County Commissioners of Monroe County, Florida, at a regular meeting of the Board, on this 18th day of December, 2002. ~~,~~~~~ ~,~> ('f\;-. (Yt ll' "~, ,y(/'~?' -..:...",~ !.\;;, ,tZ;;,;, ; /J \=:C::";~-D"'< ';~'i\\ (S~ C ;-" I '~2:; ".'\. P,," .. ,~) 'L' ~J,~~~ "",.,, .~\ I~f "Wq~~,. \ 1:~;"l:)r:.~ f~~'~:~f~~i~:' ~[:I;jJ.} \\:~< ,\::,_K,,',.:,. 80,-., ".;,-;. '., .,'i \~~;:<~~~. .:;;;?/ ~o'~>>'."""..~.' _~ "-'~,-,-'-"-T"-" MONROE COUNTY, FLORIDA ,t);a >n ~ Mayor, Board of County Commissioners ATTEST: LJJ ~(L. KOi..f.l.AtJE, Clerk APPROVED AS TO FORM AND LEGAL SUFFICIENCY: ......, ~:.:::;,.) ., C) = '-'-' I ;;t: L rr1 :;:.),' ,- 0" :x:.- C) p',~,-. -'-'fTI" ..., ' I " (J' I (:) aC-j' en c::~; y :-";"J ~. F~ ;0. :::0 -< (") -" :x r,l . --l ---. .." 'J> ,n ('") r- (;;l a )> rq ()1 ;0 .s:.- o ~~C'~~/D.L' Clerk, Board of Cou ty CommISSIOners 1.;2. - ( g -0 do ~Office 30 EXHIBIT A DISCLOSURE LETTER AND TRUTH-IN-BONDING STATEMENT SUNTRUST BANK DISCLOSURE LETTER AND TRUTH-IN-BONDING STATEMENT December 18, 2002 Board of County Commissioners of Monroe County, Florida Key West, Florida Commissioners: In connection with the purchas~ of the $4,143,945.49 aggregate principal amount of the Monroe County, Florida Solid Waste Disposal System Refunding Revenue Note, Series 2002 (the "Series 2002 Note") authorized to be issued by a resolution of Monroe County, Florida (the "Issuer") adopted on the date hereof (the "ReSolution"), the undersigned purchaser of the Series 2002 Note (the "Original Purchaser"), hereby acknowledges and represents that (1) the Original Purchaser is famlliar with the Issuer; (2) the Original Purchaser has been furnished certain business and fmancial information about the Issuer; (3) the Issuer has made available to the Original Purchaser the opportunity to ()btaih additional information and to evaluate the merits and risks of an investment in the Series 2002 Note; and (4 ) the Original Purchaser has had the opportunity to ask questions of and receive answeI'$ from representatives of the Issuer concerning the terms and conditions of the offering and the information supplied to the Original Purchaser. The Original Purchaser ackn()wledges and represents that it has been advised that the Series 2002 Note has not been registered under the Securities Act of 1933, as amended, in reliance upon the exemption contained in :Section 3(a)(2) thereof, and that the Issuer is not presently registered under Section 12 of the SecQrlties ~d Exchange Act of 1934, as amended. The Original Purchaser, therefore, realizes that if and when the Original Purchaser wishes to resell the Series 2002 Note there may not be available current bUsiness and fmancial infonnation about the Issuer. Further, no trading market now exists for the Series 2002 Note. Accordingly, the Original Purchaser understands that it may need to bear the.risks of this investment for an indefinite time, since any sale prior to the . maturity of the Series 2002 Note may notbe possible or may be at a price below that which the Original Purchaser is paying for the Series 2002 Note. It is understood that the Original Purchaser has undertaken to verify the accuracy, completeness and truth of any statements made concerning any of the material facts relating to this EXHIBIT A DISCLOSURE LETTER AND TRUTH-IN-BONDING STATEMENT transaction, including information regarding the business and financial condition of the Issuer. The Original Purchaser has conducted its own investigation to the extent it deemed necessary. The Original Purchaser has been offered an opportunity to have made available to it any and all such information it might request from the Issuer. On this basis, it is agreed by acknowledgment of this letter that the Original Purchaser hereto is not relying on any other party or person to undertake the furnishing or verification of information relating to this transaction. The Original Purchaser acknowledges that the Series 2002 Note is being purchased as part of a private placement of the Series 2002 Note negotiated directly between the Issuer and representatives of the undersigned. Accordingly, no Official Statement or other disclosure document has been prep3red in connection with the issuance of the Series 2002 Note and we hereby acknowledge that we have made our own indepelldent examination of all facts and circumstances sun-aunding the Series 2002 Note and the. financing and that no reliance has been placed on any findings by the Issuet;'in the Resol~tion as to the ability of the Issuer to meet its payment obligations so as to meet debt service on the Series 2002 Note or any other representations by anyone other than the Issuer. The Original Purchaser is purchasing the Series 2002 Note for investment purposes only and not with any present intent to distribute or resell the Series 2002 Note. The Original Purchaser hereby covenants that any Stich distribution or resale shall comply in all respects with the applicable securities laws. The Original Purchaser further acknowledges and represents that (1) it is the only initial purchaser of the Series 2002 Note, (2) it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the Series 2002 Note, and (3) it is not pu.r<:hasing the Series.2002 Note for more than one account or with a view to distributing the Series 2002 Note. The Origjnal Purchaser acknowledges that the representations contained in this paragraph are being made in ord.er to meetone of the exceptions to the continuing disclosure requirements Set forth in Rule ISc2-12 promulgated under the Securities Exchange Act of 1934. Pursuant to the provisions of Section 218.385, Florida Statutes, as amended, the Original Purchaser is providing the following infOrmation with respect to the purchase of the Series 2002 Note. The Original Purchaser represents to you as follows: (a) The nature and estimated amounts of expenses to be incurred and paid by the Original Purchaser in connection with the issuance and sale of the Series 2002 Note is: None. (b) There are no "fmders," as defined in Section 218.3 86, Florida Statutes, as amended, in connection with the issuance of the Series 2002 Note. (c) No discount or fee is expected to be realized by the Original Purchaser in connection with the issuance of the Series 2002 Note. 2 (d) No management fee will be charged by the Original Purchaser in connection with the issuance of the Series 2002 Note. (e) No other fee, bonus or other compensation will be paid by the Original Purchaser in connection with the issWince of the Series 2002 Note to any person not regularly employed or retained by the Original Purchaser (including a "finder" as defmed in Section 218.386, Florida Statutes). (t) The name and address of the Original Purchaser is: SunTrust Bank 777 Brickell Avenue, 4th Floor Miami, Florida 33131 (g) The Issuer is proposing to issue the $4,143,945049 Series 2002 Note for the principal purpose of refunding the Refunded Bonds (as defined in the Resolution). The Series - . 2002Note i~ expected to be repaid over a period of approximately 8.75 years. At an annual rate of 3 Al %, total interest paid over the life of the Series 2002 Note will be approximately $719,911.07. The expected source of repayment for the Series 2002 Note is certain Pledged Revenues (as such term is defined in the Resolution) of the ' ISSUer. Authorizing the Series 2002 Note will result in an average of approximately $555,869.32 of such revenues of theIs suer being expended to pay debt service on the Series 2002 Note each year and such amount will not be available to pay for other services of the Issuer. Very truly yours, SUNTRUST BANK By: Authorized Signatory 3 EXHIBIT B REQUEST FOR COMMITMENT MONROE COUNTY, FLORIDA REQUEST FOR COMMcrTMENT FORA TAX-EXEMPT, TERM NOTEILOAN Issue Date: November 21, 2002 Due Date: December 5, 2002 Public Financial Management, Inc. 10100 Deer Run Farms Road Ft.Myers,~ 33912 239-939-3009 239-939-1220 TABLE OF CONTENTS Page I. Introduction A. Obj ectives,_ ___________ ... ._______ _ __ __ ___ ____.____ _ __ __ _____ __ ___ _________ __________ .____ __ __ _ ________ ...._______ _. _.1 B. Bidding Instructions 1. Sealed Bids ............ _________ ___ ______________. ..__..........._.........___ _____ __....____________.____.. ..1 2. Bid Response.. _. _.___ __. _. __ _ _ _ __ _ _. _ _. __ _ _ _. _.... _.......... ......... _.. _ _ _ _ _ _ _... _._. _ _ _ _ _.... _ _.. __ _ _... ,2 3. Questions, Additionallnformation.____...._...___...m__....______.. ......_________....__.....2 4 . Tentative Schedule... _____ ___._____._._.._.._.._.__.___...__.__.___...m_____.m_...__________.._ ._....2 C. Security for N otelLoan. _ _. __ ___. ___ __ _ ____... __............... ..... __._ _ __ _ __..... ____ _ _ ____ ___..... _ _ _......3 D. Structure of the Financing..........___...._...._________....___..____..... ..______...__........___...... ..3 E. Qualified T ax -Exempt Obligation....... '''m__ ______________________ _......______________....__ __...3 F. Provisos........ __... __ __ _ _ __ _ _ _ __ _.. _ _ _. _ _ .__.. _................ ._.. _. __....._......_ _ _ __. _ _. ........... _. _ _. _ _. _._.. ,3 n. Evaluation of Responses - Criteria.............m...________________________.....m...__.___________..___.4 ill. Instructions to OfIerors.________ ________ __...___.......__._.______._____.._____._____.. .....__.____._..___.....____.5 N. Other Information.. _ __................ ...... .... _ _ __ __.............. _.... _ _. _ _...... __. _......._.. __ _ _ _ _.. _ _ __... __ _ _.6 Exhibit A Schedule of Project Cost Estimates & Note/Loan Size Estimate Exhibit B Public Entity Crimes Form REQUEST FOR COMMITMENT TERM NOTE/LOAN MONROE COUNTY, FLORIDA I. Introduction A. Objectives The objective of this Request for Commitment (the "RFC") is to identify the institution that can provide Monroe County, Florida ("County") with a bank-qualified, tax-exempt, fixed-rate Note/Loan (the "NoteJLoan") as follows: · Refund maturities 2003 through 2011 of the outstanding $5,660,000 Municipal Service District Refunding Improvement Bonds, Series 1991 ("Series 1991 Bonds") with closing after January 1, 2002. · The Series 1991 Bonds maturing on or after October 1, 2000 are subject to redemption at the option of the District, on or after October 1, 1999, in whole on any date or in part on any interest payment date, selected as directed by the District, at the following redemption prices expressed as a percentage of the principal amount of the Series 1991 Bonds to be redeemed, plus accrued interest to the redemption date: Redemption Period Redemption Price October 1, 1999 through September 30, 2000 October 1,2000 through September 30,2001 October 1,2001 and thereafter 102% 101% 100% · The note and the interest hereon will be secured by and payable from a lien upon the payments received from franchisee solid waste collectors with respect to commercial property within the area of the District; all other non ad-valorem funds received by the District with respect to the furnishing of the services of the Facilities to the residents of the District, excluding any state or federal funds received from time to time by the District; and any income derived from the investment of funds and accounts created and established by the Bond Resolution. B. Bidding Instructions 1. Sealed Bids One copy of the response to this RFC should be submitted on or before 2:00 P.M. on December 5, 2002 per the following instructions: Kyrle L. Turton Consultant Public Financial Management, Inc. 1 "" 10100 Deer Run Farms Rd. #201 Fort Myers, FL 33912 (239) 939-3009 (one copy) Jim Roberts County Administrator Monroe County 5100 College Road County Administrator Public Service Bldg., Wing IT Key West, FL 33040 (305) 292-4441 The County reserves the right to reject any and all responses, to waive any informalities or irregularities in any responses received and to readvertise or take any other such actions that may be deemed to be in the best interest of the County. 2. Bid Response Each bid should address all pertinent areas and be specific. Any conditions should be clearly stated. The failure to disclose substantive terms, conditions and covenants may be considered cause for the offeror's response to be rejected by the County. In addition, any responses that are subject to credit review and approval may be considered cause for the offeror's responSe to be rejected by the County. 3. Questions, Additional Information Offerors, their agents and/or associates shall refrain from contacting or soliciting any member of the County Commission, County staff or the County's Financing Team regarding this RFC during the selection process. Failure to comply with this provision may result in the disqualification of the offeror. All requests for clarifications or additional information should be directed to Public Financial Management, Inc., the County's Financial Advisor: Public Financial Management, Inc. 10100 Deer Run Farms Road, Suite 201 Fort Myers, FL 33912 (239) 939-3009 Phone (239) 939-1220 Fax turtonk<lilpublicfin.com The Financial Advisor may choose, at its sole discretion, to redirect such requests to other members of the County's Financing Team. However, all initial requests 2 should be directed to the Financial Advisor. All documents needed for credit review should be requested immediately. 4. Tentative Schedule The County will attempt to adhere to the following schedule: November 21, 2002 RFC Issued December 5,2002 Written responses due prior to 2:00 P.M. December 9, 2002 Analysis of Responses to County December 18, 2002 County approval of Provider January 16,2002 Closing on NotelLoan The County reserves the right to alter scheduled dates if necessary. c. Security for NotelLoan Amounts due under the NotelLoan will be payable as outlined in Section I A. D. Structure of the Financing The following describes the County's requirements in establishing the Note/Loan: 1. Amount: As outlined in Section I A. 2. Rate: Fixed, tax-exempt rate on a bank-qualified basis. The rate quoted may not exceed the maximum rate permitted under Florida Statute 215.84 applicable at the time of sale. 3. Repayment Provisions: Principal will be paid annually and interest payments on the outstanding principal balance of the Note/Loan will be calculated on a 30/360-day basis and will be paid semi-annually. 4. Prepayment Provisions: The NotelLoan is subject to prepayment with no penalty in whole or in part at any time following five (5) business days notice by the County. If the proposer is unable to adhere to the above structure, please identify the structure or minimum conditions or prepayment requirements of the proposer for bidding on the Note/Loan. 3 E. Qualified Tax-Exempt Obligation The County will attempt to take such actions as may be required by Treasury regulations In order to maintain the status of the NotelLoan as a "qualified" tax-exempt obligation according to the Internal Revenue Code. F. Other Provisions The County will not accept responses with reserve requirements or requirements to maintain minimum balances in any bank account as a condition for the NotelLoan. Gross Up The bidder may include in its bid provisions increasing the interest rate on the NotelLoan if they become taxable. The County will not consider bids that adjust the interest rate on the NotelLoan based on changes in the maximum corporate tax rate or the preference reduction rate. Additional NoteILoan (Additional Paritv Debt) The County will covenant in the resolution authorizing the issuance of the Note not to issue additional debt on a parity with the Note unless after issuance of the debt the County will have a debt service coverage ratio of at least 1.10 to 1, based on any twelve consecutive months within the eighteen months immediately preceding the date of sales of parity bonds. Late Payment The bidder may include in its bid a "late payment rate" to apply if payments are not made when due. Such a late payment rate may take effect no earlier than ten (10) days after the date payment is due. There shall be no other fees or penalties imposed for late payment. No late payment rate will be included in the bond documents unless it is specified in the bid. II. EVALUATION OF COMMITMENTS - CRITERIA Proposals will be evaluated on the basis of cost and compliance with the proposed structure and terms of the NotelLoan as outlined in this RFC. A. Proposal Format In order to assist the County in reviewing proposals, each proposal shall be prepared utilizing the following format and headings: 1. Contact Information - State the legal name of the financial institution or firm, current principal business address, contact person, telephone and facsimile numbers. 4 2. Interest Rate - State the fixed rates being proposed for the above identified structure as follows: a. Such rates must be expressed as a function of the LIB OR-based U.S. Dollar Swap Offering Rate. The final interest rate will be set no later than three (3) business days prior to the closing date for the NotelLoan. b. Provide a preliminary debt service schedule. c. Interest will be payable as discussed under Section D., "Structure of the Financing" above. 3. Fees and Expenses - Describe in detail all fees and expenses that the County will be responsible to pay for each transaction. The amounts stated in the proposal shall represent the maximum amounts payable to the offeror by the County. All fees and expenses in excess of those stated in the response shall be the sole responsibility of the offeror and will not be paid or reimbursed by the County. The County has determined that bond counsel will prepare documents. Please include your fees for bank counsel review only. Please state fees based upon both scenarios. 4. Covenants and Conditions - Provide a listing of all conditions, terms or restrictions, other than those already specified in this RFC, which would be included in your commitment to provide each Loan. III. INSTRUCTIONS TO OFFERORS A. Offerors shall thoroughly examine and be familiar with the bid specifications. Failure of any offeror to receive or examine this document shall in no way relieve any offeror of obligations pertaining to this bid or the subsequent contract. B. Any changes or modifications to the bid specifications can result in the rejection of the bid as not being responsive to this RFC. C. Any responses that are subject to credit review or approval of the bank may be considered cause for the offeror's response to be rejected by the County. All responses submitted should be commitments to lend. D. The responsibility for delivering the proposal to the County on or before the specified date and time will be solely and strictly the responsibility of the offeror. The County will in no way be responsible for delays caused by the United States Post Office or a delay caused by any other occurrence. E. The response deadline shall be strictly observed. Under no circumstances will a proposal delivered after the time specified be considered. Such responses will be returned to the offeror unopened. 5 F. Offerors will not be allowed to withdraw or modify their bids for a period of sixty (60) days after the opening time and date. G. The County reserves the right to reject the bid of any offeror who has previously failed in the proper performance of a contract or to deliver on time other contracts similar in nature, or who is not in a position to perform properly under this contract. H. Federal, state and local laws, ordinances, rules and regulations that in any manner affect the items covered herein apply. Lack of knowledge by the offeror will in no way be a cause for relief from responsibility. 1. No successful offeror may assign any portion of the contractual agreement between the parties without prior written authorization by the County. J. Changes to the RFC may be made by and at the sole discretion of the County. K. Public Entity Crimes Form - Each offeror shall complete the Public Entity Crimes Form (Exhibit B) and shall submit the same with the proposal. The County considers the failure of the offeror to submit this document to be a major irregularity and may be cause for rejection ofthe proposal. L. Warranties - The offeror, in submission of its proposal, warrants to the County that it will comply with all applicable federal, state and local laws, regulations and orders in providing the services under the proposed documents. IV. OTHER INFORMATION A. The award will be made to the institution whose response complies with all of the requirements set forth in this RFC and whose bid, in the sole opinion of the County, is best, considering all aspects of the offeror's response. B. In the event that the successful offeror does not execute a contract within a time frame acceptable to the County, the County may give notice of intent to award the bid to the next most qualified offeror or to call for new bids and may proceed to act accordingly. 6 EXHIBIT C BID PROPOSAL December 3, 2002 James L. Roberts, County Administrator Monroe County 1100 Simonton Street Suite 2-205 Key West, Florida 33040 RE: A) $5,660,000 tax-exempt bank-qualified Bond B) $3,405,000 tax-exempt bank-qualified Bond Dear Mr. Roberts: SunTrust Bank (hereinafter referred to as the "Bank") is pleased to infonn you that it has approved . and hereby extends to Monroe County its. commitment under the following tenns and conditions, and such additional terms and conditions as may be reasonably required heretofore. 1. BORROWER: Monroe County (hereinafter referred to as the "Borrower"). 2. FACILITY: A) Up to a $5,660,000.00 tax-exempt bank-qualified Bond (hereinafterreferred to as the "Bond"). B) Up to a $3,405,000.00 tax-exempt bank-qualified Bond (hereinafter referred to as the "Bond"). 3. PURPOSE: A) To refund the Municipal Service District Refunding Improvement Bonds, Series 1991. B) To refund the Guaranteed Entitlement Revenue Bonds, Series 1993. 4. COLLATERAL: A) The The Note shall be fully secured by and payable from a lien upon the payments received from franchisee solid waste collectors with respect to commercial property with the area of the District; all other non ad-valorem funds received by the District with respect to the furnishing of the services of the Facilities to the residents of the District, excluding any state or federal funds received from time to time by the District; and any income derived from the investment of funds and accounts created and establizhed by the Bond Resolution (hereinafter referred to as the "Pledged Revenue".) B) The Note shall be fully secured by a lien upon the Borrower's gross collections of the Guaranteed entitlement and second guaranteed entitlement portion of the revenue sharing trust funds of the State of Florida, as defined in and as distributable to the County, under the provisions of Chapter 218, Part II, and Florida Statutes. (hereinafter referred to as the "Pledged Revenue".) , 5. MATURITY: A) The Bond will mature on 10/1/2011. B) The Bond will mature on 121112008. 6. REPAYMENT: Interest shall be due semi-annually and principal shall be due annually. All payments by the Borrower shall be made by the due date by no later than 2:00 p.m. to the Bank in immediately available funds, free and clear of any defenses, set-offs, counterclaims; or withholdings or deductions for taxes. Payments received more than 10 days past the due date shall be assessed a 5% late payment fee. There shall be no prepayment penalty. The Borrower shall provide a minimum of5 business days notice of its intent to prepay the Bond in whole or in part. 7. FEE(S) AND EXPENSES: The Borrower shall be required to pay the Bank's attorney fees for review of all legal documents, which shall be capped at $5,000.00, based upon Borrower's counsel preparing the documentation. 8. INTEREST RATE: A) The Bond shall bear a tax-exempt bank qualified rate fixed for the term of the Bond. Said fixed rate shall be set 3 business days prior to the date of closing and it shall be equal to {the 10 year federal reserve h.15 statistical release rate for fixed rate payers and interest rate swaps, "the index rate", phIS 85 basis points} divided by 1.5054. (As of 12/02/02, this rate was 3.690A..) The index rate can be found at the following website: http://federalreserve.gov/teleaseslhI5/current. Interest at the foregoing rate will be computed on the basis of a 30/360-day year. B) The Bond shall bear a tax-exempt bank qualified rate fixed for the term of the Bond. Said fixed rate shall be set 3 business days prior to the date of closing and it shall be equal to {the 7 year federal reserve h.15 statistical release 'rate for fixed rate payers and interest rate swaps, "the index rate", plus 70 basis points}., (As of 12/02/02, this rate was 3.29%.) The index rate can be found at the following website: http://federalreserve.gov/releasesIh15/current. Interest at the foregoing rate will be computed on the basis of a 30/360-day year. 9. DOCUMENTATION: At or prior to closing, the Bank shall have received all documents that are typical for transactions of this nature. 10. FINANCIAL REPORTING REQUIREMENTS: 2 The Borrower shall submit audited financial statements and an operating budget for all funds, as ratified by the County Commission, to the Bank not less than annually. 11. COVENANTS & CONDITIONS: Funding of the Bond is contingent upon a satisfactorily legal opinion as to the Borrower's tax-exempt status and authority under its Charter to borrow money, as well to the fact that the Bond constitutes bank-qualified status. The legal opinion and the authority to borrow money must be acceptable to the Bank in form, manner, tenure and purpose. There shall be no material adverse change in the Borrower's financial condition prior to closing. 12. DEBT SERVICE COVERAGE TEST: A) Gross revenues of the .municipal service district-waste enterprise funds less expenses priQr to transfers (excluding depreciation & amortization, interest expel)se and non cash expenses) shall provide a 135% coverage of the annual interest & principal requirement of the Bond. Any additional debt secured by .the Pledged Revenues must meet a 135% coverage ratio. The Borrower shall covenant to maintain charged rates at a sufficient level to be able to meet the debt service coverage B) Gross collections of the Pledged Revenues must provide a 105% coverage of the ~ual interest & principal requirement of the Bond. Any additional debt secwed br the Pledged Revenues must meet a 105% coverage ratio for the highest annual debt service requirement to be incurred. 13. . ATTORNEY'S FEE-AND COSTS IN THE EVENT BOND DOES NOT CLOSE: Boqower agrees that should this transaction fail to close for any reason, the Bond 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 this Commitment, and Borrower understands that such fee shall be paid by Borrower immediately upon receipt of a statement. 14. INTEREST RATE ADJUSTMENT: If the Bond is issued at a tax exempt rate but later the interest on the Bond becomes taxable for any reason, then the Bond will bear interest from the earliest effective date as of which interest payable on the Bond is includable in the gross income of the Bank at a (ate Per annum equal to the interest rate on this Bond times [1.54] [multiplier ifnon bank qualified] (the "Taxable Rate"). 15. ARBIRTRAGE REPONSIBLILITY: The Borrower shall assume whatever responsibility and take whatever action is necessary to assure that the Bond will not constitute an "arbitrage bond" under the provision of Section 148 of the Code. Additionally, the Borrower shall covenant to comply with any and all rebate requirements contained in Section 148 of the Code. 3 16. INTEREST RATE LIMITATION: The Borrower shall be responsible for ensuring that the Bond complies with the provisions of Section 215.84, Florida Statutes, relating to maximum rate ofinterest including, but not limited to, the filing of a request with the State Board of Administration for authorization of the interest rate provided herein, if such interest rate is in excess of the maximum rate. 17. REPRESENTATIONS: The Borrower warrants and represents that to the best of its knowledge all the docum.entS and/or inf()rmation provided to the Bank prior to the date hereof are true. and co~ and.further acknowledges that the issuance of this Commitment Letter by the J3ank is in reliance upon the accuracy and truth of said documents and/or information. Further, the Borrower warrants and represents that all material information known to the Borrower has been disclosed to the Bank and the Borrower acknowledges that the Bank has relied upon this representation in the issuance of this Commitment Letter. 18. COMPLIANCE: This Commitment shall comply with the- regulations of the Comptroller of the Currency and the regulatory agencies governing the Bank. 19~ WAIVER OF TRIAL BY JURY: JF ANY LEGAL ACTION IS TAKEN WITH RESPECT TO THIS ~OMMITMENT OR THE NOTE DOCUMENTS, OR ANY TRANS,ACTlO~.. DESCRIBED IN. THIS COMMITMENT, THE BORROWER ANi> BANK WAIVE THEIR RIGHTS TO TRIAL BY JURY. 4 20. ACCEPTANCE: This Commitment shall be considered null and void unless the Borrower shall acknowledge acceptance hereof by signing and returning this letter on or before December 20, 2002. On behalf of Sun Trust Bank it is our pleasure to extend this credit to you and we look forward to establishing a mutually beneficial relationship. If you have any questions, please give me a call at (305) 579-7014, otherwise execute the commitment letter where indicated below. Sincerely, Kimrey Newlin First Vice President Institutional & Governmental Banking ACCEPTANCE: The terms and conditions of this Commitment are hereby accepted. Dated: Monroe County By: As its: ;;.- .- By: As its: 5 EXHIBIT D FORM OF ESCROW DEPOSIT AGREEMENT ESCROW DEPOSIT AGREEMENT ESCROW DEPOSIT AGREEMENT, dated as of December 19,2002, by and between MONROE COUNTY, FLORIDA (the "County"), and THE BANK OF NEW YORK TRUSTCOMP ANY OF FLORIDA, N.A. (the "Escrow Agent"), a national banking association organized and existing under the laws of the United States of America, having its designated corporate trust office in Jacksonville, Florida, as escrow agent hereunder. WHEREAS, there has heretofore been issued the Monroe County Municipal Service District Refunding Improvement Bonds, Series 1991 (the "Series 1991 Bonds")pursuantto Resolution No. 061-1991 adopted on March 12, 1991, as amended and supplemented (the "Refunded Bonds Resolution"); and WHEREAS, the County has determined to exercise the option under the Refunded Bonds Resolution to current refundall of the Senes 1991 Bonds (the "Refunded Bonds"); and WHEREAS, the County has determined to issue its $4,143,945.49 Monroe County, Florida Solid Waste Disposal System Refunding Revenue Note, Series 2002 (the "Series 2002 Note") pursuant to a resolution adopted on December 18,. 2002, a portion of the . proceeds of which Series 2002 Bonqs will be used to purchase certain United States Treasury obligations in order to provide payment for th,e Refunded Bonds and discharge and satisfy the pledges, liens 'and other obligations under the Refunded Bonds Resolution in regard to such Refunded Bonds; and WHEREAS, the issuance of the Series 2002 Bonds, the purchase by the Escrow Ageiltof the hereinafter defined Escrow Securities, the deposit of such Escrow Securities into an 'escrow deposit trust fund to. be held by the Escrow Agent and the discharge and satisfaction of the pledges, liens and other obligations under the Refunded Bonds Resolution in regard to the Refunded Bonds shall occur as a simultaneous transaction; and WHEREAS, this Agreement is intended to effectuate such simultaneous transaction; NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth, the parties hereto agree as follows: SECTION 1. PREAMBLES. The County represents that the recitals stated above are true and correct, and the same are incorporated herein. SECTION 2. RECEIPT OF REFUNDED BONDS RESOLUTION. Receipt of a Uu!le and correct copy of the above-mentioned Refunded Bonds ,Resolution and this Agreemmt is hereby acknowledged by the Escrow Agent. The applicable and necessary provisions of the Refunded Bonds Resolution, including, without limitation, Section 2.09 and Section 6.05 thereof, are incorporated herein by reference. Reference herein to or citation herein of any provisions of the Refunded Bonds Resolution shall be deemed to incorporate the same as a part hereof in the same manner and with the same effect as if the same were fully set farth herein. SECTION 3. DISCHARGE OF PLEDGE OF HOLDERS OF REFUNDED BONDS. In accordance with Section 6.05 of the Refunded Bonds Resolution, the County by thiswiting exercises the option to cause the pledge of and lien on the Pledged Funds (as defined in the Refunded Bonds Resolution) in favor of the holders of the Refunded Bonds to no kmgar be in effect. SEC110N 4. ESTABLISHMENT OF ESCROW FUND. There is hereby createdaod established with the Escrow Agent a special, segregated and irrevocable escrow deposit Bust . fund designated the "Monroe County Municipal Service District Refunding Improvanent Bonds, Series 1991 Escrow Deposit Trust Fund" (the "Escrow Fund"). The Escrow Fund shall be held in the custody of the Escrow Agent as a trust fund for the benefit . of the holders of the Refunded Bonds, separate and apart from other funds and accounts of the CoDDly and the Escrow Agent. The Escrow Agent hereby accepts the Escrow Fund and acknowledges the receipt of and deposit to the credit of the Escrow Fund the sum of $4,110,-145.49 from the County from proceeds of the Series 2002 Note (the "Note Proceeils*), and the sum of$1 ,666~ 192.00 received from the County from certain moneys on depositin the funds and accounts established pursuant to the Refunded Bonds Resolution for the bendit of the holders of the Refunded Bonds (the "County Moneys"). SECfION 5. . DEPOSIT OF MONEYS AND SECURITIES IN ESCROW FUND. The County hereby directs and the Escrow Agent represents and acknowledges that, concllllmtly with the deposit of the Note Proceeds and County Moneys under Section 4 above, it has used all of the Note Proceeds and $1,666,190.51 of the County Moneys to purchaseon behalf of and for the acco~t of the County certain open market, non-callable United States Treasury obligations (collectively, together with any other securities which may be on dqJosit, from time to time, in the Escrow Fund, the "Escrow Securities"), which are descnl>ed in Schedule A hereto, and the Escrow Agent will deposit such Escrow Securities and $1.49 in cash (the "Cash Deposit") in the Escrow Fund. All Escrow Securities shall be noncallable, direct obligations of the United States of America. 2 In the event any of the Escrow Securities described in Schedule A hereto are not available for delivery on December19, 2002, the Escrow Agent may, at the written direction of the County and with the approval of Bond Counsel, substitute other United States Treasury obligations and shall credit such other obligations to the Escrow Fund and hold such obligations until the aforementioned Escrow Securities have been delivered. The Escrow Agent shall in no manner be responsible or liable for failure or delay of Bond Counselor the County to promptly approve the substitutions of other United States Treasury obligations for the Escrow Fund. SECTION 6. SUFFICIENCY OF ESCROW SECURITIES AND THE CASH DEPOSIT~ The County represents that the Cash Deposit and the interest on and the principal amounts successively maturing on the Escrow Securities in accordance with their terms (without consideration of any re~vestment of such maturing principal and interest) are . sufficient such that moneys will be av&ilable to the Escrow Agent in amounts sufficient and at the times required to pay the @Il1ounts of principal of, redemption premium, if any, and interest due and to become due on the Refunded Bonds as described in Schedule B attached . . hereto. If the Escrow Securities and the Cash Deposit shall be insufficient to make such paYments, the CQunty shalltimely deposit to the Escrow Fund, solely from legally available funds of the County, such additional amounts as may be required to pay the Refunded Bonds as described in Schedule B hereto. Notice of any insufficiency shall be given by the Escrow Agent to the County as promptly as possible, but the Escrow Agent shall in no manner be responsible for the County's failure to make such deposits. SECTION 7. E~QROW SF;CURlTIES AND THE CASH DEPOSIT IN TRUST FOR HOLDERSOFREFt1NDED BONDS. The deposit of the Escrow Securities and the Cash Deposit in the Escrow Fund shall constitute an irrevocable deposit of Federal Securities (as. defined in the Refunded Bonds Resolution) and cash in trust solely for the paYment of the principal of, redemption premium, if any, and interest on the Refunded Bonds at such tImes and in such amounts as set forth in Schedule B hereto, and the principal of and interest earnings 00 such Escrow Securities and the Cash Deposit shall be used solely for such purpose. SECTION 8. ESCROW AGENT TO PAY REFUNDED BONDS FROM ESCROW FUND. Th~ County hereby directs, and the Escrow Agent hereby agrees, that it will take all actions required to be taken by it under the provisions of the Refunded Bonds Resolution referenced in tltis Agreement, including the timely transfer of money to the Paying Agent for the Refunded Bonds (The Bank of New York) as provided in the Refunded Bonds Resolution, in order to effectuate this Agreement and to pay the Refunded Bonds in the amounts and at the times ptovided in Schedule B hereto. The Escrow Securities and the Cash Deposit shall be used to pay the principal of, redemption premium, if any, and interest 3 on the Refunded Bonds as the same may mature or be redeemed. If any paYment date shall be a day on which either the Paying Agent for the Refunded Bonds or the Escrow Agent is not open for the acceptance or delivery of funds, then the Escrow Agent may make paYment on the next business day. The liability of the Escrow Agent for the payment of the principal of, redemption premium, if any, and interest on the Refunded Bonds pursuant to this Agreement shall be limited to the application of the Escrow Securities and the Cash Deposit and the interest earnings thereon available for such purposes in the Escrow Fund. SECTION 9. REINVESTMENT OF MONEYS AND SECURITIES IN ESCROW FUND. Moneys deposited in the Escrow Fund shall be invested only in the Escrow Securities listed in Schedule A hereto and the Cash Deposit and, except as provided in Section 5 hereof and this Section 9, neither the County nor the Escrow Agent shall otherwise invest or reinvest any moneys in the Escrow Fund. Except as provided in Section 5 hereof and in this Section 9, the Escrow Agent may not sell or otherwise dispose of any or all of the Escrow Securities or the Cash Deposit in the Escrow Fund and. reinvest the proceeds thereof in other securities nor may it substitute securities for any of the Escrow Securities, except upon written direction of the County and where, prior to any such reinvestment or substitution, the Escrow Agent has received from the County the following: (a) a written verification report by a fmn of independent certified public accountants, ,of recognized standing, appointed by the County and acceptable to the Escrow Agent, to the effect that after such reinvestment or substitution the principal amount of Escrow Securities, together with the interest therein, . will be sufficient to pay the Refunded Bonds as described in Schedule B hereto (such verification shall not be necessary in the event the County shall determine to reinvest cash in Escrow Securities which mature on or before the next principalandlor interest paYment date for the Refunded Bonds and which have a face amount which is at least equal to the cash amount invested in such Escrow Securities); and (b) a written opinion of nationally recognized Bond Counsel to the effect that (i) such investment will not cause the Series 2002 Bonds or the Refunded Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code, as amended, and the regulations promulgated thereunder or otherwise cause the interest on the Refunded Bonds or the Series 2002 Note to be included as gross income for purposes offederal income taxation, and (ii) such investment does not violate any provision of Florida law or of the Refunded Bonds Resolution. 4 The above-described verification report need not be provided in the event the County purchases Escrow Securities with the proceeds of maturing Escrow Securities and such purchased Escrow Securities mature on or before the next interest paYment date for the Refunded Bonds and have a face amount which is at least equal to the cash amount invested in such Escrow Securities. In the event the above-referenced verification concludes that there are surplus moneys in the Escrow Fund, such surplus moneys shall be released to the County upon its written direction. The Escrow Fund shall continue in effect until the date upon which the Escrow Agent makes the fmal paYment to the Paying Agent for the Refunded Bonds in an amount sufficient to pay the Refunded Bonds as described in Schedule B hereto, whereupon the Escrow Agent shall sell or redeem any Escrow Securities remaining in the Escrow Fund, and shall remit to the County the proceeds thereof, together with all other money, if any, then remaining in the Escrow Fund. SECTION 10. REDEMPTION OF CERTAIN REFUNDED BONDS. The COmity hereby irrevocably instructs the Escrow Agent to direct, on behalf of the Issuer, that . the Registrar and Paying Agent for the Refunded Bonds (The Bank of New York) give at the appropriate times the notice or notices, if any, required by the Refunded Bonds Resolution in connection with the redemption of the Refunded Bonds. Such notice of redemption shall be given by the Registrar for such Refunded Bonds in accordance with the Refunded Bonds Resoluti"on. The Refunded Bonds shall be redeemed on January 28,2003 at a redemption price ell,~1 to 100% of the principal amount thereof plus interest accrued to the redemption date. SECTION 11. DEFEASANCE NOTICE TO HOLDERS OF REFUNDED BONDS. Concurrently with the deposit of the Escrow Securities and Cash Deposit set forth in Section 5 hereof, the Refunded Bonds shall be deemed to have been paid within the meaning and with the effect expressed in Section 6.05 of the Refunded Bonds Resolution. Within 30 days of the deposit of moneys into the Escrow Fund, the Escrow Agent, on behalf of the County, shall Cause the Paying Agent for the Refunded Bonds (The Bank of New York) to mail to the holders of the Refunded Bonds the appropriate notices in the form provided in Schedule C attached hereto. SECTION 12. ESCROW FUND IRREVOCABLE. The Escrow Fund hereby created shall be irrevocable and the holders of the Refunded Bonds shall have an express lien on all Escrow Securities and the Cash Deposit deposited in the Escrow Fund pursuant to the terms hereof and the interest earnings thereon until paid out, used and applied in accordance with this Agreement and the Refunded Bonds Resolution. Neither the County nor the 5 Escrow Agent shall cause nor permit any other lien or interest whatsoever to be imposed upon the Escrow Fund. SECTION 13. AMENDMENTS TO AGREEMENT. This Agreement is made for the benefit of the County and the holders from time to time of the Refunded Bonds and it shall not be repealed, revoked, altered or amended without the written consent of all such holders and the written consent of the Escrow Agent; provided, however, that the County and the Escrow Agent may, without the consent of, or notice to, such holders, enter into such agreements supplemental to this Agreement as shall not adversely affect the rights of such holders and as shall not be inconsistent with the terms and provisions of this Agreement, for anyone or more of the following purposes: (a) to cure any ambiguity or formal defect or omission in this Agreement; (b) to grant, or confer upon, the Escrow Agent for the benefit of the holders of the Refunded Bonds, any additional rights, remedies, powers or authority that may lawfully be granted to, or conferred upon, such holders or the Escrow Agent; and (c) to subject to this Agreement additional funds, securities or properties. The Escrow Agent shall be entitled to rely exclusively upon an unqualified opinion of nationally recog --;red Bond COUtlsel with respect to compliance with this Section 13, . including the exter:. ;' any, to which any change, modification or addition affects the rights of the holders ofth Aefunded Bonds, or that any instrument executed hereunder complies with the conditions and provisions of this Section 13. SECfION 14. FEES AND EXPENSES OF ESCROW AGENT; INDEMNIFICATION. In consideration of the services rendered by the Escrow Agent under this Agreement, the County agrees to and shall pay to the Escrow Agent the fees and expenses as shall be agreed to in writing by the parties hereto. The Escrow Agent shall have no lien whatsoever upon any of the Escrow Securities in said Escrow Fund for the paYment of such proper fees and expenses. The County further agrees to indemnify and save the Escrow Agent harmless, to the extent allowed by law, against any liabilities which it may incur in the exercise and performance ofits powers and duties hereunder, and which are not due to its negligence or misconduct. .Indemnification provided under this Section 14 shall survive the termination of this Agreement. Whenever the Escrow Agent shall deem it necessary or desirable that a matter be proved or established prior to taking, suffering or omitting any action under this Agreement, 6 such matter may be deemed to be conclusively established by a certificate signed by an authorized officer of the City. The Escrow Agent may conclusively rely, as to the correctness of statements, conclusions and opinions therein, upon any certificate, report, opinion or other document furnished to the Escrow Agent pursuant to any provision of this Agreement; the Escrow Agent shall be protected and shall not be liable for acting or proceeding, in good faith, upon such reliance; and the Escrow Agent shall be under no duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument The Escrow Agent may consult with counsel, who may be counsel to the County or independent counsel, withregard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith in accordance herewith. Prior to retaining such independent counsel, the Escrow Agent shall notifY the County of its intention. The Escrow Agent and its successors, agents and servants shall not be held to any personal liability whatsoever, in tort, contract or otherwise, by reason of the execution and delivery of this Agreement, the' establishment of the Escrow Fund, the acceptance and disposition of the various moneys and funds described herein, the purchase, retention or payment, transfer or. other application of funds or securities by the Escrow Agent in accordance with the provisions of this Agreement or any non-negligent act, omission or error of the Escrow Agent made ingood faith in the conduct of its duties. The Escrow Agent shall, however, be liable to the County and to holders of the Refunded Bonds to the extent of their respective damages for negligent or willful acts, omissions or errors of the Escrow Agent which violate or fail to comply ,'",';+h the tenns of this Agreement. The duties and obligations of the Escrow Agent shall be detr:tnined by the express provisions of this Agreement. SECTION IS. REPORTING REQUIREMENTS OF ESCROW AGENT. As soon as practicable after January 28, 2003, the Escrow Agent shall forward in writing to the County a statement in detail of the activity of the Escrow Fund. SECTION 16. RESIGNATION OR REMOVAL OF ESCROW AGENT. The Escrow Agent, at the time acting hereunder, may at any time resign and be discharged from the duties and obligations hereby created by giving not less than 20 days written notice to the Copoty and mailing notice'thereo!: specifYing the date when such resignation will take effect to the holders of all Refurtded Bonds then outstanding, but no such resignation shall take effect unless a successor Escrow Agent shall ,have been appointed by the holders of a majority in aggregate principal amount of the Refunded Bonds then outstanding or by the County as hereinafterprovided and such successor Escrow Agent shall have accepted such appointment, in which event such resignation shall take effect immediately upon the appointment and acceptance of a successor Escrow Agent. 7 The Escrow Agent may be replaced at any time by an instrument or concurrent instruments in writing, delivered to the Escrow Agent and signed by either the County or the holders of a majority in aggregate principal amount of the Refunded BOIids then outstanding. Such instrument shall provide for the appointment of a successor Escrow Agent, which appointment shall occur simultaneously with the removal of the Escrow Agent. In the event the Escrow Agent hereunder shall resign or be removed, or be dissolved, or shall be in the course of dissolution or liquidation, or otherwise become incapable of acting hereunder, or in case the Escrow Agent shall be taken under the control of any public officer or officers, or of a receiver appointed by a court, a successor may be appointed by the holders of a majority in aggregate principal amount of the Refunded Bonds then outstanding by an instrunlent or concurrent iristruments in writing,. signed by such holders, or by their attomeys.in fact, duly authorized. in writing; provided, nevertheless, that in any such event, the County shall appoint a temporary Escrow Agent to fill such vacancy until a successor Escrow Agent shall be appointed by the holders of a majority in aggregate principal amount of the Refunded Bonds then outstanding in the manner above provided, and any such temporary Escrow Agent so appointed by the County shall immediately and without further act be superseded by the EsCrow Agent so appointed by such holders. The County shall mail notice of any such appointment made by it at the times and in the manner described in the fIrst paragraph of this Section 16. In the event that no appointment of a successor Escrow Agent or a temporary successor Escrow Agent shall have been mad~ by such holders or the County pursuant to the foregoing provisions of this Section 16 witJ..in "~O days after written notice of resignation of the Escrow Agent has been given to the City ~' .~ holder of any of the Refunded Bonds or any retiring Escrow Agent may apply to any court of competent jurisdiction for the appointment of a successor Escrow Agent, and such court may thereupon, after such notice, if any, as it shall deem proper, appoint a successor Escrow Agent. In the event of replacement or resignation of the Escrow Agent, the Escrow Agent shall remitto the County the prorated portion of prepaid fees not yet incurred or payable, less ~y termination fees and expenses atthe time of discharge, and shall have no further liability hereunder and the County shall indemnity and hold harmless Escrow Agent from any such liability, including costs or expenses incurred by Escrow Agent or its counsel. No successor Escrow Agent shall be appointed unless such successor Escrow Agent shall be a corporation with trust powers organized under the banking laws of the United States or any State, and shall have at the time of appointment capital and surplus of not less than $30,000,000. 8 Every successor Escrow Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the County an instrument in writing accepting such appointment hereWlder and thereupon such successor Escrow Agent, without any further act, deed or conveyance, shall become fully vested with all the rights, immunities, powers, trusts, duties and obligations of its predecessor; but such predecessor shall nevertheless, on the written request of such successor Escrow Agent or the County execute and deliver an instrument transferring to such successor Escrow Agent all the estates, properties, rights, powers and trust of such predecessor hereunder; and every predecessor Escrow Agent shall deliver all securities and moneys held by it to its successor; provided, however, that before any such delivery is required to be made, all fees, advances and expenses of the retiring or removed Escrow Agent shall be paid in full. Should any transfer, assignment or instrument . in writing from the County be required by any successor Escrow Agent for more fully and certainly vesting in such successor Escrow Agent the estates, rights, powers and duties hereby vested or interided to be vested in the predecessor Escrow Agent, any such transfer, assignment and instruments in writing shall, on request, be executed, acknowledged and delivered by the City. Any corporation into which the Escrow Agent, or any successor to it in the trusts created by this Agreement, may be merged or converted or with which it or any successor to it may be consolidated, or any corporation resulting from any merger, conversion, consolidation or tax-free reorganization to which the Escrow Agent or any successor to it shall be a party shall be the successor Escrow Agent under this Agreement without the exec_ution or filing of any paper Of any other act on the ~art of any of the parties hereto, anything herein to the contrary notwithstanding. SECTION 17. TERMINATION OF AGREEMENT. This Agreement shall terminate when all transfers and paYments required to be made by the Escrow Agent under the provisions hereof shall have been made. Upon such termination, all moneys remaining in the Escrow Fund shall be released to the City. SECTION 18. GOVERNING LAW. This Agreement shall be governed by the applicable laws of the State of Florida. SECTION 19. SEVERABILITY. If anyone or more of the covenants or agreements provided in this Agreement on the part of the County or the Escrow Agent to be performed should be detennined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Agreement. 9 SECTION 20. COUNTERPARTS. This Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as one original and shall constitute and be but one and the same instrument. SECTION 21. NOTICES. Any notice, authorization, request or demand required or permitted to be given in accordance with the terms of this Agreement shall be in writing and sent by registered or certified mail addressed to: Monroe County, Florida 1100 Simonton Street, Suite 2-205 Key West, Florida 33040 Attn: County Administrator The Bank of New York Trust Company of Florida, N .A. Towermarc Plaza 10161 Centurion Parkway Jacksonville, Florida 32256 Attn: Corporate Trust Department [Remainder of page intentionally left blank] 10 IN WITNESS WHEREOF, the parties hereto have each caused this Escrow Deposit Agreement to be executed by their duly authorized officers and appointed officials and their seals to be hereunder affixed and attested as of the date first written herein. (SEAL) MONROE COUNTY, FLORIDA Mayor, Board of County Commissioners ATTEST: Clerk, Board of County Commissioners THE BANK.OF NEW YORK TRUST COMPANY OF FLORIDA, N.A., as Escrow Agent (SEAL) By: Authorized Signatory 1I Type SLG ESCROW SECURITIES Settlement Maturity Date Date 12/19/02 01/28/03 Par Amount $5,776,636 A-I Interest Rate 1.15% SCHEDULE A Purchase Price $5,776,636 SCHEDULE B DEBT SERVICE REQUIREMENTS FOR REFUNDED BONDS Payment Date Principal Interest 01/28/03 $5,660,000.00 $123,917.63 Premium -0- Total $5,783,917.63 B-1 SCHEDULE C FORM OF NOTICE OF DEFEASANCE Notice is hereby given pursuant to Resolution No. 061-1991 adopted by the Board of County Commissioners of Monroe County, Florida on March 12, 1991, as amended and supplemented (the "Refunded.Bonds Resolution"), that all of the outstanding Monroe County Municipal Service District . Refunding Improvement Bonds, Series 1991 (the "Refunded Bonds") are deemed to be pa~d within the meaning of the Refunded Bonds Resolution and sha!l DO longer be secured from the. Pledged Funds (as defmed in the Refunded Bonds Resolution) and shall be secured solely from the irrevocable deposit of U.S. Treasury obligations made by the County with The lJank of New York Trust Company of Florida, N.A., Jacksonville, FlQrida, as Escrow Agent, in accordance with Section 6.05 of the Refunded Bonds Resolution. The Refunded Bonds shall be redeemed on January 28, 2003 at the offices of the paying agent for the Refunded Bonds (The Bank of New York) at a redemption price equal to 100% of the principal amount thereof plus interest accrued to the redemption date. C-I