3. 06/09/1999 Payment Agreement
TAX EXEMPT DOCUMENTS - CONFIDENTIAL AND PROPRIETARY
PAYMENT AGREEMENT
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This PAYMENT AGREEMENT is made as of~.:t, 1999 by and between MONROE
COUNTY a political subdivision, with its principal offices at 10600 Aviation Blvd., Marathon, FL
33050 ("Customer"), and BSFS, with its principal offices at 501 Corporate Centre Drive, Suite 600,
Franklin, TN 37067 ("Funder");
WITNESSETH
WHEREAS, Customer and Service Contractor (such term and all other capitalized terms
used in these recitals being defined in Article I hereof) have entered into the Service Document
pursuant to which Service Contractor has agreed to provide the Service to Customer on the terms
and conditions stated therein; and
WHEREAS, the Service Document provides Customer with the option to make the Service
Payment to Service Contractor with respect to the Service; and
WHEREAS, Customer intends to exercise such option; and
WHEREAS, Funder is willing to make the Service Payment to Service Contractor on behalf
of Customer, on the terms and conditions provided herein.
NOW, THEREFORE, Customer and Funder, intending to be legally bound hereby, agree as
follows:
ARTICLE I
DEFINITIONS AND EXHIBITS
Section 1.1. Definitions. Unless the context otherwise requires, the terms defined in this
action shall, for all purposes of this Agreement, have the meanings herein specified.
Agreement: This Payment Agreement, as amended or supplemented in accordance with the
terms hereof.
Code: The Internal Revenue Code of 1986, as now or hereafter amended, any successor
thereto, and the Treasury regulations and revenue rulings and procedures applicable thereunder.
Commencement Date: The date upon which Customer's obligation to make Payments
accrues, which date shall be the date that Funder makes the Service Payment to Service Contractor
on behalf of Customer, as evidenced by the insertion by Funder on Exhibit A of the Payment Dates
of the Payments coming due therein.
Incumbency Certificate: The certificate of Customer attached hereto as Exhibit D.
IRS: Internal Revenue Service.
Nonappropriation: The failure of Customer or Customer's governing body to appropriate
money for any fiscal year of Customer sufficient for the continued performance by Customer of all
of Customer's obligations under this Agreement, as evidenced by the passage of an ordinance or
resolution specifically prohibiting Customer from performing its obligations under this Agreement
and from using any moneys to pay any Payments for a designated fiscal year and all subsequent
fiscal years.
Payment: The payment due from Customer to Funder on each Payment Date during the
Term, as shown on Exhibit A.
Payment Date: The date upon which any Payment is due and payable as provided in
Exhibit A.
Private Business Use: Use described in section 141(b)(6) of the Code.
Service: The telephone service to be provided by Service Contractor to Customer pursuant
to the Service Document.
Service Certificate: The certificate of Customer attached hereto as Exhibit B.
Service Contractor: BellSouth Telecommunications, Inc.
Service Contractor Acknowledgment: The acknowledgment by Service Contractor in form
and substance satisfactory to Funder.
Service Document: Special Service Arrangement Agreement dated tv - CJ - <1 9 between
Service Contractor and Customer.
Service Payment: The one-time up-front payment to Service Contractor with respect to the
Service, to be paid pursuant to the Service Document.
State: The state or commonwealth in which Customer is situated.
Tariff: The tariff and any other rules or regulations applicable to Service Contractor,
Service Document, the Service, this Agreement, the Acknowledgment or any of the transactions
contemplated thereby or hereby.
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Tax: Any and each fee (including, without limitation, license, documentation and
registration fee), tax (including, without limitation, federal, state, local or foreign income, gross
receipts, capital stock, franchise, profits, withholding, social security, unemployment, disability,
real property, personal property (tangible or intangible), stamp, excise, occupation, sales, rental,
use, transfer, turnover, value added, alternative minimum and estimated tax), license, levy, impost,
duty, charge, assessment or withholding of any nature whatsoever, and any and all interest,
penalties, fines or additions with respect thereto, whether disputed or not.
Term: The period during which this Agreement is in effect as specified in Section 3.1.
Section 1.2. Exhibits. The following exhibits are attached to and by reference made a part
of this Agreement:
Exhibit A: A schedule indicating the date and amount of each Payment coming due during
the Term and the portions of each Payment comprising principal and interest.
Exhibit B: Service Certificate.
Exhibit C: Form of opinion of counsel to Customer as to the powers of Customer, the
validity, execution and delivery of this Agreement and various related documents; and related
matters.
Exhibit D: Incumbency Certificate.
ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS OF CUSTOMER
Section 2.1. Representations and Warranties of Customer. Customer hereby represents,
warrants and covenants to Funder that:
(a) Customer has full power and authority under the Constitution and laws of
the State to enter into this Agreement and the transactions contemplated hereby, and to
perform all of its obligations hereunder.
(b) The officer of Customer executing this Agreement has been duly authorized
to execute and deliver this Agreement under the terms and provisions of a resolution of
Customer's governing body or by other appropriate official action.
(c) The execution, delivery and performance of this Agreement has been duly
authorized and approved by all persons, governmental bodies and agencies necessary to
authorize and approve this Agreement.
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(d) This Agreement has been duly executed and delivered by and constitutes the
valid and binding obligation of Customer, enforceable against Customer in accordance with
its terms (except as enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors' rights generally or by the principles
governing the availability of equitable remedies).
(e) The execution, delivery and performance of this Agreement by Customer
shall not (i) violate any federal, state or local or other governmental law or ordinance, or
any order, writ, injunction, decree, rule or regulation of any court or other governmental
agency or body applicable to Customer; or (ii) conflict with or result in the breach or
violation of any term or provision of or constitute a default under, any note, bond,
mortgage, indenture, agreement, deed of trust, lease or other obligation to which Customer
is bound, if such conflict, breach or violation would give rise to any right of termination,
cancellation or acceleration under any of the terms, conditions or provisions of such
instrument.
(f) In authorizing and executing this Agreement, Customer has complied with
all laws applicable to this Agreement and the acquisition by Customer of the Service,
including any applicable public bidding laws.
(g) No lease, rental agreement, lease-purchase agreement, payment agreement
or contract for purchase, to which Customer has been a party at any time during the past ten
years, has been terminated by Customer as a result of insufficient funds being appropriated
in any fiscal year. No event has occurred which would constitute an event of monetary
default under any debt, revenue bond or obligation which Customer has issued during the
past ten years.
(h) There is no change pending in the structure, powers, boundaries or affairs of
Customer (including, without limitation, any consolidation or incorporation into another
entity) which could affect the requirements or need of Customer for the Service, and
Customer is neither (i) engaged in or contemplating any such change nor (ii) aware that any
other governmental unit, agency or other body with jurisdiction or control over the affairs of
Customer plans or contemplates any such change.
(i) Customer has appropriated and/or taken other lawful actions necessary to
provide moneys sufficient to pay all Payments required to be paid under the Agreement
during the current fiscal year of Customer, and such moneys will be applied in payment of
all Payments due and payable during such current fiscal year.
(j) There is no litigation, action, suit or proceeding pending or before any court,
administrative agency, arbitrator or governmental body that challenges the authority of
Customer or its officers or employees to enter into this Agreement, the proper authorization,
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approval and execution of this Agreement and other documents contemplated thereby, the
appropriations of moneys, or any other action taken by Customer to provide moneys
sufficient to make Payments corning due under this Agreement in Customer's current fiscal
year, or the ability of Customer otherwise to perform its obligations under the Agreement
and the transactions contemplated thereby.
(k) During the Term, the Service will be used solely by employees, officers and
officials of Customer to perform only governmental functions and will not be used for any
Private Business Use.
(1) The money which will be utilized to make the Payments shall consist of
funds appropriated by Customer for such purpose. The obligations of Customer under this
Agreement, including its obligation to make Payments, shall constitute a current expense of
Customer and shall not constitute an indebtedness of Customer within the meaning of the
Constitution and laws of the State. Nothing herein shall constitute a pledge by Customer of
any taxes or other moneys (other than moneys lawfully appropriated from time to time by
or for the benefit of Customer for this Agreement) to the payment of any Payment or other
amount corning due hereunder.
(m) Customer has not been notified of (i) any listing or proposed listing of it by
the IRS as an issuer whose certification may not be relied upon by holders of obligations of
Customer or (ii) any disqualification of Customer by the IRS because a certification made
by Customer contains a material misrepresentation.
(n) Customer does not expect to receive any refund of the Service Payment
under the Service Document.
(0) The terms of the Service Document were negotiated at ann's length.
(P) Customer determined to enter into a multiple-year, fixed-fee telephone
service contract independent of the decision to prepay such contract.
Section 2.2. Covenants of Customer. Customer hereby covenants and agrees that it will:
(a) Assure that its obligation to pay Payments is not directly or indirectly
secured by any interest in property.
(b) Not take any action or permit or suffer any action to be taken or condition to
exist if the result of such action or condition would be to cause its obligation to make
Payments to be guaranteed, directly or indirectly, in whole or in part, by the United States
of America or by any agency or instrumentality thereof.
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(c) Neither take any action nor omit to take any action if the result of such
action or omission would be to cause the interest component of the Payments to become
includable in the income of Funder for purposes of federal, state or local income tax.
(d) Provide (or cause to be provided) to Funder such other information as
Funder may reasonably request from Customer (including budgets, proof of appropriation
and financial statements).
(e) On or prior to the Commencement Date, provide to Funder completed and
executed copies of each of the following:
(i) The Service Certificate.
(ii) An opinion of Customer's legal counsel in substantially the form
attached hereto as Exhibit C.
(iii) Financing statements executed by Customer and describing as
collateral all of Customer's rights under the Service Document, including (without
limitation) the right to any amounts due from Service Contractor under the Service
Document.
(iv) The Incumbency Certificate.
(v) The Service Contractor Acknowledgment.
(vi) A copy of executed Form 8038-G for filing with the IRS.
(vii) A copy of the Service Document executed by Customer and Service
Contractor.
(viii) A copy of any authorization for Service Document required by the
applicable Public Utilities Commission.
(ix) Funder shall have reached agreement with Service Contractor.
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ARTICLE III
TERM
Section 3.1. Term. This Agreement shall be in effect for a Term commencing upon the
Commencement Date and ending on the earliest of (a) the date that Customer has paid all amounts
due hereunder, (b) termination hereof by Funder upon the occurrence of an event of default under
Section 9.1 hereof and (c) termination hereof pursuant to Section 3.2 hereof; provided, however,
that any rights or obligations of the parties accruing during the Term shall survive the termination
of this Agreement. Upon determination of the Commencement Date, Funder shall insert on
Exhibit A the Payment Dates of the Payments coming due therein.
Section 3.2. Termination Following Nonappropriation. In the event of Non appropriation,
this Agreement shall terminate, in whole but not in part, at the end of any fiscal year of Customer
for which funds were appropriated, in the manner and subject to the terms specified in this Section
and Sections 3.3 and 3.4 hereof. Customer may effect such termination of this Agreement by
giving Funder a written notice of termination and by paying to Funder any Payments which are due
and have not been paid at or before the end of its then current fiscal year. Customer shall endeavor
to give notice of termination not less than 60 days prior to the end of such fiscal year and shall
promptly notify Funder of any anticipated termination.
Section 3.3. Intent To Continue Term; Appropriations. Customer presently intends to
continue this Agreement for the entire Term and to pay all Payments specified in Exhibit A.
Customer will include in its budget request for each fiscal year during the Term the Payments to
become due in such fiscal year, and will use all reasonable and lawful means at its disposal to
secure the appropriation of moneys for such fiscal year sufficient to pay the Payments coming due
therein. Customer reasonably believes that moneys in an amount sufficient to make all such
Payments can and will lawfully be appropriated and made available for this purpose.
Section 3.4. Nonsubstitution. If this Agreement is terminated by Customer in accordance
with Section 3.2, Customer agrees not to purchase, lease or rent personal property or services to
perform substantially similar functions as, or functions substantially taking the place of those
performed by the Service, and agrees not to permit such functions to be performed by its own
employees or by any agency or entity affiliated with or hired by Customer, for a period of 12
months; provided, however, that these restrictions shall not be applicable if or to the extent that the
application of these restrictions would affect the validity of this Agreement.
ARTICLE IV
PAYMENTS
Section 4.1. Service Payment. Funder hereby agrees, subject to the terms and conditions
of this Agreement, to advance funds on behalf of Customer in the amount set forth in Exhibit
A; and Customer hereby agrees to repay such amount to Funder. Upon fulfillment of the
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conditions set forth in Section 2.2(e) hereof, Funder shall pay such amount to Service
Contractor. Customer's obligation to repay amounts advanced hereunder shall commence, and
charges shall begin to accrue, on the Commencement Date.
Section 4.2. Payments. Customer agrees to pay the Payments during the Term, in the
amounts and on the Payment Dates specified in Exhibit A. All Payments shall be paid to Funder at
the address specified in the first paragraph of this Agreement, or to such other person or entity to
which Funder has assigned such Payments as specified in Article VIII, at such place as such
assignee may from time to time designate by written notice to Customer. Customer shall pay the
Payments exclusively from moneys legally available therefor, in lawful money of the United States
of America and neither the full faith and credit of Customer, the State of Florida or any political
subdivision or agency thereof is pledged for payments hereunder.
Section 4.3. Current Expense. Customer and Funder understand and intend that the
obligation of Customer to pay Payments hereunder shall constitute a current expense of Customer,
shall be subject to duly authorized appropriation by Customer, and shall not in any way be
construed to be a debt of Customer in contravention of any applicable constitutional or statutory
limitation or requirement concerning the creation of indebtedness by Customer, nor shall anything
contained herein constitute a pledge of the full faith and credit or of the general tax revenues, funds
or moneys of Customer. Funder further acknowledges that, under applicable law, certain other
monetary obligations of Customer contained in this Agreement are subject to duly authorized
appropriation by Customer and it is the intention of the parties hereto that this Agreement not be
interpreted to purport to create any obligation on Customer in this regard contrary to applicable law.
Section 4.4. Interest Component. A portion of each Payment is paid as and represents the
payment of interest. Exhibit A sets forth the interest component of each Payment.
Section 4.5. Payments To Be Unconditional. Except as provided in Section 3.2, the
obligation of Customer to make Payments or any other payments required hereunder shall be
absolute and unconditional in all events and not subject to any abatement, setoff, defense or
counterclaim. Notwithstanding any dispute between Customer and Funder, Service Contractor or
any other person, Customer shall make all Payments and other payments required hereunder when
due and shall not withhold any Payment or other payment pending final resolution of such dispute,
nor shall Customer assert any right of setoff or counterclaim against its obligation to make such
Payments or other payments required under this Agreement. Customer's obligation to make
Payments or other payments during the Term shall not be abated by reason of failure or
nonperformance of the Service, accident or unforeseen circumstances.
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ARTICLE V
OTHER OBLIGATIONS OF CUSTOMER
Section 5.1. Use Permits. Customer shall not use the Service improperly, carelessly, in
violation of any local, State or federal law or for a pmpose or in a manner contrary to that
contemplated by this Agreement.
Section 5.2. Taxes, Other Governmental Charges and Utility Charges. (a) Except as
expressly limited by this Section, Customer shall pay all Taxes and other charges of any kind
whatsoever, including, without limitation, Federal excise tax and utility charges, which are at any
time assessed or levied against or with respect to, the Service or any part thereof, or which become
due during the Term with respect to the Service or the Payments, assessed against Customer or
Funder; provided, however, except as set forth in subsection (c), Customer shall not be required to
pay any federal, State or local income, inheritance, estate, succession, transfer, franchise, gift, gross
receipts, profit, excess profit, capital stock, corporate or other similar tax payable by Funder, its
successors or assigns, unless such tax is made in lieu of or as a substitute for any tax, assessment or
charge which is the obligation of Customer. Funder shall give Customer prompt notice of the
imposition or assessment of any such Tax or charge and Customer shall be permitted to contest, at
its expense, the imposition or assessment of such Tax or charge, provided that Customer shall be
permitted to contest the imposition or assessment of such Tax or charge only if the following
condition is met, complied with and satisfied to the complete satisfaction in all respects of Funder.
Customer shall, on demand, immediately reimburse Funder for any and all administrative expenses
that may be incurred by Funder in connection with any such contest.
(b) Notwithstanding subsection (a) of this Section, Customer's obligation to pay any
sales, use or personal property tax shall not apply if such tax results from Funder's failure to file
returns and reports required by any federal, State or local statute, rule or regulation or to provide a
proper resale certificate.
(c) If Customer breaches a covenant in this Agreement or if a representation or
warranty made by Customer in this Agreement is wrong, then Customer shall hold Funder harmless
on an after-tax basis from any IRS assessment of interest paid or payable pursuant to this
Agreement as includable in the gross income of Funder for federal income tax pmposes, if such
assessment results from such breach or misrepresentation.
Section 5.3. Advances. If Customer shall fail to perform any of its obligations under this
Article, Funder may, but shall not be obligated to, take such action as may be necessary to cure
such failure, including the advancement of money, and Customer shall be obligated to repay all
such advances on demand, with interest at an annual rate equal to 18%, or the maximum rate
permitted by law, whichever is less, from the date of the advance to the date of repayment.
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ARTICLE VI
SECURITY
Section 6.1. Security Interest.. To secure its obligations hereunder, Customer hereby
irrevocably assigns to Funder and grants to Funder a security interest in the Service Document and
any amounts payable by Service Contractor thereunder.
ARTICLE VII
WARRANTIES
Section 7.1. Selection of Service and Disclaimer of Warranties. The Service and Service
Contractor have been selected by Customer, and Funder shall have no responsibility in connection
with such selection, the suitability of the Service for the uses intended by Customer, the acceptance
of any order submitted with respect to the Service, or any delay or failure by Service Contractor or
any sales representatives thereof to manufacture, deliver or install the Service for use by Customer.
THE SERVICE IS PROVIDED AS IS, AND FUNDER MAKES NO WARRANTY OR REPRESENTATION, EITHER
EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR
ANY PARTICULAR PURPOSE OR FITNESS FOR THE USE CONTEMPLATED BY CUSTOMER OF THE SERVICE,
OR ANY OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE SERVICE.
Section 7.2. Installation and Maintenance of Service. Funder shall have no obligation to
install, erect, test, inspect, serve or maintain the Service under any circumstances, and such actions
shall be the obligation of Customer.
Section 7.3. Warranties. Funder hereby assigns to Customer for and during the Term all of
its interests in all Service Contractor's warranties, express or implied, issued on or applicable to the
service, and Funder hereby authorizes Customer to obtain the customary services furnished in
connection with such warranties at Customer's expense.
ARTICLE VIII
ASSIGNMENT, MORTGAGING AND SELLING
All ofFunder's rights, title and/or interest in and to this Agreement, the Payments and other
amounts due hereunder may be assigned and reassigned in whole or in part to one or more
assignees or sub assignees by Funder at any time. Customer shall cooperate with Funder or its
assignee either now or hereafter by acknowledging any agreement relating thereto which in no way
will alter or affect the terms and conditions of this Agreement and the assignment of the Agreement
by Funder. No such assignment shall be effective as against Customer unless and until the assignor
shall have filed with Customer or its agent a copy or written notice thereof identifying the assignee.
Customer agrees unconditionally, if so requested by Funder, to pay directly to such assignee all
sums which may be or become due hereunder. The receipt by assignee of such payments shall
discharge the obligations of Customer to Funder hereunder to the extent of the payments. Any such
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assignee shall have all the rights, privileges and powers of Funder hereunder, as fully as though
such assignee were Funder hereunder. Customer shall keep a written record of all such assignments
in form necessary to comply with section 149(a) of the Code.
ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
Section 9.1. Events of Default Defined. The following shall be "events of default" under
this Agreement and the terms "events of default" and "default" shall mean, whenever they are used
in this Agreement, anyone or more of the following events:
(a) Failure by Customer to pay any Payment or other payment required to be
paid under this Agreement at the time specified herein and the continuation of said failure
for a period of 10 days.
(b) Failure by Customer to observe and perform any covenant, condition or
agreement on its part to be observed or performed, other than as referred to in
subsection (a) of this Section, for a period of 30 days after written notice specifying such
failure has been given to Customer by Funder.
(c) The determination by Funder that any representation or warranty made by
Customer in this Agreement or any other document executed in connection herewith was
untrue in any material respect when made.
(d) The filing by Customer of a voluntary petition in bankruptcy, or failure by
Customer promptly to lift any execution, garnishment or attachment of such consequence as
would impair the ability of Customer to carry on its governmental or proprietary function or
adjudication of Customer as a bankrupt, or assignment by Customer for the benefit of
creditors, or the entry by Customer into an agreement of composition with creditors or the
approval by a court of competent jurisdiction of a petition applicable to Customer in any
proceedings instituted under the provisions of the federal Bankruptcy Code, as amended, or
under any similar acts which may hereafter be enacted.
(e) Customer shall become insolvent or shall fail or be unable generally to pay
its debts as they become due.
Section 9.2. Remedies on Default. Whenever any event of default referred to in
Section 9.1 hereof shall have happened and be continuing, Funder shall have the right, at its option
and without any further demand or notice, to take one or any combination of the following remedial
steps:
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(a) Funder, with or without terminating this Agreement, may declare to be
immediately due and payable by Customer all amounts hereunder for which funds have
been appropriated, whereupon such amounts shall be immediately due and payable.
(b) Funder may take any other remedy available at law or in equity to require
Customer to perform any of its obligations hereunder.
Section 9.3. No Remedy Exclusive. No remedy conferred upon or reserved to Funder by
this Article is intended to be exclusive and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Agreement. No delay or omission 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 thereof but any such right and power may be exercised from time to time and as
often as may be deemed expedient by Funder.
Section 9.4. Late . Any Payment not paid by Customer on the due date thereof
shall, to the extent permissible by a, ar a late charge equal to the lesser of ten cents ($.10)
per dollar of the delinquent amount or the la aximum, and Customer shall be obligated to
pay the same immediately upon receipt ofFunder's inVO~06~
ARTICLE X
ADMINISTRATIVE PROVISIONS
Section 10.1. Notices. All notices hereunder shall be sufficiently given and shall be
deemed given when delivered or deposited in the United States mail in certified or registered form
with postage fully prepaid to the address specified on the first page hereof, provided that Funder
and Customer, by notice given hereunder, may designate different addresses to which subsequent
notices will be sent.
Section 10.2. Financial Information. During the Term, Customer, upon Funder's written
request, will provide Funder with Customer's financial statements, proof of appropriation for the
ensuing fiscal year and such other financial information relating to the ability of Customer to
continue this Agreement as may be requested by Funder.
Section 10.3. Severability. If any of the provisions of this Agreement shall be invalid or
unenforceable, such invalidity or unenforceability shall not invalidate or render unenforceable the
entire agreement, but rather the entire agreement shall be construed as if not containing the
particular invalid or unenforceable provision or provisions, and the rights and obligations of
Customer and Funder shall be construed and enforced accordingly.
Section 10.4. No Waiver. Any party's failure at any time to enforce any provisions of this
Agreement or any right or remedy available hereunder or at law or equity, or to exercise any option
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herein provided, will in no way be construed to be a waiver of such provisions, rights, remedies or
options provided hereunder or at law or equity and shall not preclude or prejudice the exercising
thereafter of the same or any other rights, remedies or options.
Section 10.5. Entirety of Agreement. The terms and conditions of any and all exhibits,
schedules and attachments to this Agreement are incorporated herein by this reference and shall
constitute part of this Agreement as if fully set forth herein at length. This Agreement, together
with all exhibits, schedules and attachments hereto, constitutes the entire agreement between the
parties and supersedes all previous agreements, promises and representations, whether written or
oral, between the parties with respect to the subject matter contained herein.
Section 10.6. Invoicing. Any invoices for Payments or other amounts due shall be directed
to Customer at the following address:
Monroe County
1 0600 Aviation Blvd.
Marathon, FL 33050
Section 10.7. Miscellaneous. This Agreement shall inure to the benefit of and shall be
binding upon Funder and Customer and their respective successors and assigns. This Agreement
may be amended or any of its terms modified only by a written document duly authorized, executed
and delivered by Funder and Customer. Funder and Customer agree that they will, from time to
time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such
supplements hereto and such further instruments as may reasonably be required for carrying out the
expressed intentions of this Agreement. This Agreement shall be governed by and construed in
accordance with the laws of the State. Section headings appearing in this Agreement are inserted
merely for the convenience of reference and they are not to be considered part of, or be used in
interpreting, this Agreement.
Section 10.8. Usury. It is the intention of the parties hereto to comply with any applicable
usury laws; accordingly, it is agreed that, notwithstanding any provisions to the contrary herein, in
no event shall this Agreement require the payment or permit the collection of interest or any
amount in the nature of interest or fees in excess of the maximum amount permitted by applicable
law. Any such excess interest or fees shall first be applied to reduce principal and when no
principal remains, refunded to Customer. In determining whether the interest paid or payable
exceeds the highest lawful rate, the total amount of interest shall be spread through the term hereof
so that the interest is uniform through such term.
Section 10.9. Waiver of Jury Trial. Customer and Funder hereby waive any right to trial
by jury in any action or proceeding with respect to, in connection with or arising out of this
Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
MONROE COUNTY
Customer
BSFS
Funder
By: ~ '>,..1..-v ~ . .......;\~~
Title: ~R-. {; -9- 99
By:
d~~
Vl~ Pr~SI~
Title:
(SEAL)
ATTEST: DANn L KClLHAGE CLE;::K
~C.~)(J~
[ .:.L', ,',:u:.. .:<
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EXHIBIT A TO PAYMENT AGREEMENT
PAYMENT SCHEDULE
See Attached Schedule
Exhibit A - Page 1
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FOR ACCTG. PURPOSES ONLY.
DOES NOT REPRESENT A BUY OUT, CASUALTY OR TERMINATION VALUE.
CUSTOMER MONROE COUNTY
AMOUNT $1,618,620.00
TERM 84 Payments to commence November 1, 1999
ADV or ARR ARR
PAYMENT BEGINNING INTEREST PRINCIPAL TOTAL ENDING
NUMBER BALANCE EXPENSE PAYMENT PAYMENT BALANCE
0 1,618,620.00 0.00 0.00 0.00 1,618,620.00
1 1,618,620.00 8,001.17 15,591.68 23,592.85 1,603,028.32
2 1,603,028.32 7,924.09 15,668.75 23,592.85 1,587,359.57
3 1,587,359.57 7,846.64 15,746.21 23,592.85 1,571,613.36
4 1,571,613.36 7,768.80 15,824.04 23,592.85 1,555,789.31
5 1,555,789.31 7,690.58 15,902.27 23,592.85 1,539,887.05
6 1,539,887.05 7,611.97 15,980.87 23,592.85 1,523,906.17
7 1,523,906.17 7,532.98 16,059.87 23,592.85 1,507,846.30
8 1,507,846.30 7,453.59 16,139.26 23,592.85 1,491,707.05
9 1,491,707.05 7,373.81 16,219.04 23,592.85 1,475,488.01
10 1,475,488.01 7,293.64 16,299.21 23,592.85 1,459,188.80
11 1,459,188.80 7,213.06 16,379.78 23,592.85 1,442,809.02
12 1,442,809.02 7,132.10 16,460.75 23,592.85 1,426,348.27
13 1,426,348.27 7,050.73 16,542.12 23,592.85 1,409,806.15
14 1,409,806.15 6,968.96 16,623.89 23,592.85 1,393,182.26
15 1,393,182.26 6,886.78 16,706.07 23,592.85 1,376,476.19
16 1,376,476.19 6,804.20 16,788.65 23,592.85 1,359,687.54
17 1,359,687.54 6,721.21 16,871.64 23,592.85 1,342,815.91
18 1,342,815.91 6,637.81 16,955.04 23,592.85 1,325,860.87
19 1,325,860.87 6,554.00 17,038.85 23,592.85 1,308,822.02
20 1,308,822.02 6,469.77 17,123.07 23,592.85 1,291,698.95
21 1,291,698.95 6,385.13 17,207.72 23,592.85 1,274,491.23
22 1,274,491.23 6,300.07 17,292.78 23,592.85 1,257,198.45
23 1,257,198.45 6,214.59 17,378.26 23,592.85 1,239,820.19
24 1,239,820.19 6,128.68 17,464.16 23,592.85 1,222,356.03
25 1,222,356.03 6,042.35 17,550.49 23,592.85 1,204,805.53
26 1,204,805.53 5,955.60 17,637.25 23,592.85 1,187,168.28
27 1,187,168.28 5,868.41 17,724.43 23,592.85 1,169,443.85
28 1,169,443.85 5,780.80 17,812.05 23,592.85 1,151,631.80
29 1,151,631.80 5,692.75 17,900.10 23,592.85 1,133,731. 70
30 1,133,731. 70 5,604.26 17,988.58 23,592.85 1,115,743.12
31 1,115,743.12 5,515.34 18,077.50 23,592.85 1,097,665.62
32 1,097,665.62 5,425.98 18,166.86 23,592.85 1,079,498.75
33 1,079,498.75 5,336.18 18,256.67 23,592.85 1,061,242.09
34 1,061,242.09 5,245.93 18,346.91 23,592.85 1,042,895.18
35 1,042,895.18 5,155.24 18,437.60 23,592.85 1,024,457.57
36 1,024,457.57 5,064.10 18,528.75 23,592.85 1,005,928.82
37 1,005,928.82 4,972.51 18,620.34 23,592.85 987,308.49
38 987,308.49 4,880.47 18,712.38 23,592.85 968,596.11
39 968,596.11 4,787.97 18,804.88 23,592.85 949,791.23
40 949,791.23 4,695.01 18,897.84 23,592.85 930,893.39
CUSTOMER MONROE COUNTY
AMOUNT $1,618,620.00
TERM 84 Payments to commence November 1, 1999
ADVorARR ARR
PAYMENT BEGINNING INTEREST PRINCIPAL TOTAL ENDING
NUMBER BALANCE EXPENSE PAYMENT PAYMENT BALANCE
41 930,893.39 4,601.59 18,991.25 23,592.85 911,902.14
42 911,902.14 4,507.72 19,085.13 23,592.85 892,817.01
43 892,817.01 4,413.37 19,179.47 23,592.85 873,637.54
44 873,637.54 4,318.57 19,274.28 23,592.85 854,363.26
45 854,363.26 4,223.29 19,369.56 23,592.85 834,993.70
46 834,993.70 4,127.54 19,465.30 23,592.85 815,528.40
47 815,528.40 4,031.32 19,561.52 23,592.85 795,966.87
48 795,966.87 3,934.62 19,658.22 23,592.85 776,308.65
49 776,308.65 3,837.45 19,755.40 23,592.85 756,553.25
50 756,553.25 3,739.80 19,853.05 23,592.85 736,700.20
51 736,700.20 3,641.66 19,951.19 23,592.85 716,749.01
52 716,749.01 3,543.04 20,049.81 23,592.85 696,699.20
53 696,699.20 3,443.92 20,148.92 23,592.85 676,550.28
54 676,550.28 3,344.32 20,248.52 23,592.85 656,301. 76
55 656,301. 76 3,244.23 20,348.61 23,592.85 635,953.14
56 635,953.14 3,143.64 20,449.20 23,592.85 615,503.94
57 615,503.94 3,042.56 20,550.29 23,592.85 594,953.66
58 594,953.66 2,940.98 20,651.87 23,592.85 574,301.79
59 574,301.79 2,838.89 20,753.96 23,592.85 553,547.83
60 553,547.83 2,736.30 20,856.55 23,592.85 532,691.28
61 532,691.28 2,633.20 20,959.65 23,592.85 511,731.64
62 511,731.64 2,529.59 21,063.25 23,592.85 490,668.38
63 490,668.38 2,425.47 21,167.37 23,592.85 469,501.01
64 469,501.01 2,320.84 21,272.01 23,592.85 448,229.00
65 448,229.00 2,215.69 21,377.16 23,592.85 426,851.84
66 426,851.84 2,110.01 21,482.83 23,592.85 405,369.01
67 405,369.01 2,003.82 21,589.03 23,592.85 383,779.98
68 383,779.98 1,897.10 21,695.74 23,592.85 362,084.24
69 362,084.24 1,789.86 21,802.99 23,592.85 340,281.25
70 340,281.25 1,682.08 21,910.77 23,592.85 318,370.48
71 318,370.48 1,573.77 22,019.08 23,592.85 296,351.41
72 296,351.41 1,464.92 22,127.92 23,592.85 274,223.48
73 274,223.48 1,355.54 22,237.30 23,592.85 251,986.18
74 251,986.18 1,245.62 22,347.23 23,592.85 229,638.95
75 229,638.95 1,135.15 22,457.69 23,592.85 207,181.26
76 207,181.26 1,024.14 22,568.71 23,592.85 184,612.55
77 184,612.55 912.58 22,680.27 23,592.85 161,932.28
78 161,932.28 800.46 22,792.38 23,592.85 139,139.90
79 139,139.90 687.80 22,905.05 23,592.85 116,234.85
80 116,234.85 574.57 23,018.27 23,592.85 93,216.57
81 93,216.57 460.79 23,132.06 23,592.85 70,084.52
82 70,084.52 346.44 23,246.40 23,592.85 46,838.11
83 46,838.11 231.53 23,361.32 23,592.85 23,476.80
84 23,476.80 116.05 23,476.80 23,592.85 0.00
TOTALS 363,179.09 1,618,620.00 1981799.09
CUSTOMER
AMOUNT
TERM
ADV or ARR
MONROE COUNTY
$1,618,620.00
84 Payments to commence November I, 1999
ARR
PAYMENT
NUMBER
BEGINNING
BALANCE
INTEREST
EXPENSE
PRINCIPAL
PAYMENT
TOTAL
PAYMENT
ENDING
BALANCE
Payments in Schedule A are based on a payment factor ("Payment Factor") of .014575 on
May 24, 1999 ("Quote Date") based upon the seven year Treasury Constant Maturities
yield (''Yield'') as reported by the Federal Reserve Statistical Release (H. 15 Report)
on the Quote Date. For each 25 basis point increase in the Yield up to the Commencement Date,
the Payment Factor and the Payments shall be increased by .000118.
EXHIBIT C TO PAYMENT AGREEMENT
FORM OF OPINION OF COUNSEL
(TO BE PREPARED ON COUNSEL'S LETTERHEAD)
BSFS
501 Corporate Centre Dr., Suite 600
Franklin, TN 37067
Re: Payment Agreement dated as of May _, 1999 (the "Agreement") by and between
BSFS ("Funder") and Monroe County ("Customer")
I have acted as counsel to Customer with respect to the above-captioned Agreement and
various related matters, and in this capacity have reviewed a duplicate original of the Agreement.
Capitalized terms used in this opinion without definition have the meanings ascribed thereto in the
Agreement.
Based upon my examination of these and such other documents as I deem relevant, it is my
opinion that:
1. Customer is a body corporate and politic and public instrumentality of the State,
duly organized, existing and operating under the Constitution and laws of the State and has the
attributes of a "state or political subdivision thereof' within the meaning of section 103( c)(1) of the
Internal Revenue Code of 1986 which are necessary to permit the issuance of obligations bearing
interest which is exempt from federal income taxation.
2. Customer has full power and authority under the Constitution and laws of the State
to enter into the Agreement and the transactions contemplated thereby, to perform all of its
obligations thereunder and the transactions contemplated thereby.
3. The officer of Customer executing the Agreement has been duly authorized to
execute and deliver the Agreement.
4. The execution, delivery and performance of the Agreement has been duly
authorized and approved by all persons, governmental bodies and agencies necessary to authorize
and approve the agreement.
5. The Agreement and the other documents described above have been duly
authorized, approved and executed by and on behalf of Customer, and the Agreement is a valid and
binding contract of Customer enforceable in accordance with its terms, except to the extent limited
Exhibit C- Page 1
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by State laws affecting remedies and by bankruptcy, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights.
6. The execution, delivery and performance of the Agreement and the appropriation of
moneys to pay the Payments coming due thereunder do not violate any federal, State or local or
other governmental law or ordinance, or any order, writ, injunction, decree, rule or regulation of
any court or other governmental agency or body applicable to Customer, including, without
limitation, any constitutional, statutory or other limitation relating to the manner, form or amount of
indebtedness which may be incurred by Customer.
7. There is no limitation, action, suit or proceeding pending or before any court,
administrative agency, arbitrator or governmental body that challenges the authority of Customer or
its officers or its employees to enter into the Agreement, the proper authorization, approval and
execution of the Agreement and the other documents described above, the appropriation of moneys
to make Payments under the Agreement for the current fiscal year of Customer or the ability of
Customer otherwise to perform its obligations under the Agreement and the transactions
contemplated thereby.
8. Any assignee or subassignee of all or part of Funder's right, title and/or interest in
and to the Agreement shall be entitled to rely on this opinion as though it were addressed directly to
any such assignee or sub assignee.
Very truly yours,
Exhibit C- Page 2
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EXHIBIT D TO PAYMENT AGREEMENT
INCUMBENCY CERTIFICATE
NAME, SIGNATURE AND TITLE OF PERSON OR PERSONS
WHO SIGNED PAYMENT AGREEMENT:
Name
Signature
Title
I, the undersigned, hereby certify that I am the duly qualified and acting
,;11 a Va Y of-Monroe County ("Customer"), and, with respect to the Payment
Agreement dated as o~e...3.., 1999 (the "Agreement") by and between Customer and BSFS
("Funder"), that I am well acquainted with the persons listed above and with their signatures, that
said persons hold the respective offices or positions set forth opposite their signatures above, that
the signatures above written are true and correct signatures of said persons, and that as of the date of
execution of the Agreement or other documents relating thereto by and of said persons, such
persons were duly qualified and acting as the officers or position holders indicated above and duly
authorized to execute the same:
(A PERSON WHO DID NOT SIGN THE
PAYMENT AGREEMENT)
MONROE COUNTY
r.:.._L.........~ .
~b.oQ.c .~/)
IJEPUTY a.ERK
\~~-,,\~
By: \.
Print Name: /L) I I he,l ~ . t) CL H O-rV~'y
Title: mQ'1 0 r / eh a. If rY) a. n
/
Date: (p - 9 - 9 9
Exhibit 0 - Page 1
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TAX-EXEMPT DOCUMENTS - CONFIDENTIAL AND PROPRIETARY
ACKNOWLEDGMENT
JU.ne.
To induce BSFS ("Funder") to enter into the Payment Agreement dated as of May 3-, 1999
(the "Payment Agreement") between MONROE COUNTY ("Customer") and Funder and to make
the Service Payment (as defined in the Payment Agreement) on behalf of Customer and for other
good and valuable consideration, BellSouth Telecommunications, Inc. ("Service Contractor")
hereby acknowledges and agrees as follows:
1. Service Contractor understands that Funder is entering into the Payment Agreement
and making the Service Payment on behalf of Customer in reliance on the terms hereof.
2. The amount of the Service Payment is $1,618,620..
3. Service Contractor has entered into an agreement to provide service (the "Service")
to Customer in accordance with Special Service Arrangement Agreement (the "Service
Document").
4. The Service Document is in full force and effect; there has been no default in
performance of any obligation thereunder or breach of any term therein by either party thereto; and
Customer has asserted no set-off, counterclaim or defense with respect to its obligations to perform
in accordance with the terms of the Service Document or to pay the Service Payment due
thereunder.
5 The Service Document and any amendments thereto, copies of which have been
provided to Funder herewith, constitute the entire writing, obligation and agreement between
Service Contractor and Customer respecting the Service.
6. Customer has accepted the Service, as evidenced by the Service Certificate (as
defined in the Payment Agreement).
7. Service Contractor shall fully and timely perform each of its obligations in the
Service Document.
8. Service Contractor may be required in certain instances to pay to Customer certain
amounts due under the Service Document (for example, if the Service is terminated as a result of
Service Contractor's breach of the Service Document, regulatory action or nonappropriation). Any
such amounts will be paid directly to Funder.
9. Up-front payments (or prepayments) on substantially the same terms are made by a
substantial percentage of persons similarly situated to Customer but who are not beneficiaries of
tax -exempt financing.
TAX-EXEMPT DOCUMENTS - CONFIDENTIAL AND PROPRIETARY
10. Up-front payments for service such as the Service is customary and available to all
of Service Contractor's large customers.
11. The individual cost-based pricing reflected in the Service Document was done in a
manner similar to that used for individual cost-based pricing for other customers of Service
Contractor pursuant to applicable regulatory requirements or considerations and was computed
without regard to the availability or unavailability of tax-exempt financing to Customer to provide
for payment of the Service Payment.
11. The terms of the Service Document were negotiated at arm's length and constitute a
customary range of services and terms for similar contracts entered into by Service Contractor and
entities other than Customer, including a significant number of entities that are not state or local
governmental units.
12. The Service Document and all such contracts (including the pricing and other terms
and conditions thereof) are in compliance with all laws and regulations.
13. Service Contractor is not treating and will not treat the prepayment of the Service
Payment as a loan to Service Contractor for federal income tax purposes.
..:::::Ju....()e
Dated:-May l, 1999
BSFS
By:
AGREED:
Title:
BELLSOUTH TELECOMMUNICATIONS, INC.
By:
Date:
2
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EXHIBIT B TO PAYMENT AGREEMENT
SERVICE CERTIFICATE
I, the undersigned, hereby certify that I am the duly qualified and acting /11 ay 0 ( .J ~
of Monroe County ("Customer"), and, with respect to the Payment Agreement dated as of-May
~, 1999 (the "Agreement") by and between Customer and BSFS ("Funder") that (capitalized
terms used herein without definition having the meanings ascribed thereto in the Agreement):
1. The Service (a) has been implemented to the satisfaction of Customer, (b) has been
thoroughly examined and inspected to the complete satisfaction of Customer, (c) has been found to
be and is suitable for Customer's purposes and (d) is hereby accepted by Customer, in the condition
received, for all purposes.
2. Customer has appropriated and/or taken other lawful actions necessary to provide
moneys sufficient to pay all Payments required to be paid under the Agreement during the current
fiscal year of Customer, and such moneys will be applied in payment of all Payments due and
payable during such current fiscal year.
3. There is no litigation, action, suit or proceeding pending or before any court,
administrative agency, arbitrator or governmental body, that challenges the authority of Customer
or its officers or employees to enter into the Agreement, the proper authorization, approval and
execution of the Agreement and other documents contemplated thereby, the appropriations of
moneys, or any other action taken by Customer to provide moneys sufficient to make Payments
coming due under the Agreement in Customer's current fiscal year, or the ability of Customer
otherwise to perform its obligations under the Agreement and the transactions contemplated
thereby.
MONROE COUNTY
~
ATTES-r. DANNYL KOUiAGE ClERK
~c.~
DEPUTY CLERK'
.. ... ~.'L ,.....~
B. ~):I.1\..6......AA- ~... \ '\ ~--, ~"~
y. ~
Title: f1 A Y ~ f2-
Date: fe/flry
Exhibit B - Page 1
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5/24/99
CONFIDENTIAL AND PROPRIETARY INFORMATION
To: BSFS ("Funder")
The undersigned hereby acknowledges that the forms of Payment Agreement
and Acknowledgment ("Documents") being provided to the undersigned are confidential
and proprietary information of Funder and are being provided to the undersigned solely
to permit the undersigned to evaluate entering into a transaction with Funder.
The undersigned shall hold the Documents in confidence~nd shall not disclose
the Documents to others without Funder's written consent. The Documents shall remain
the property of Funder and shall be returned to Funder when the undersigned's need for
them have expired or upon request of Funder.
MONROE COUNTY
~fd: ~ /J;bl,c ~ I~ .
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Title: m 4 VI III G~ Q,~ (tY\(A 1\
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Date: Lo-q-~q
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L:\Clients A,MIClients MIMonroe CountyICONF.DOC
5/24/99
ATTACHMENT A TO DCC FINANCING STATEMENT
Secured Party:
BSFS
501 Corporate Centre Dr., Suite 600
Franklin, TN 37067
Debtor:
Monroe County
1 0600 Aviation Blvd.
Marathon, FL 33050
Description of property:
ALL OF DEBTOR'S RIGHT, TITLE AND INTEREST IN, TO AND UNDER THE SPECIAL
SERVICE ARRANGEMENT AGREEMENT DATED AS OF &;- q - 9 9
("SERVICE DOCUMENT") BETWEEN DEBTOR AND BELLSOUTH
TELECOMMUNICATIONS, INe. ("SERVICE CONTRACTOR") AND ALL AMOUNTS DUE
TO DEBTOR THEREUNDER OR OTHERWISE FROM SERVICE CONTRACTOR AND ALL
PROCEEDS OF THE FOREGOING.
L:\Clients A-MlClients MlMonroe CountyIBSFSUCC.DOC
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