HomeMy WebLinkAbout$5,500,00 Cap Improvement Revenue Note, 2014$5,500,000
CITY OF CAPE CANAVERAL, FLORIDA
CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
(the "Note ")
Listing of Closing Documents
Closing Date: February 26, 2014
1. Certified copy of City of Cape Canaveral, Florida (the "City ") Ordinance No. 03 -2014
adopted by the City Council on February 18, 2014 authorizing the issuance of the Note,
among other matters.
2. Certified copy of City Resolution No. 2014 -05 adopted by the City Council on February
18, 2014, authorizing the sale of the Note to Hancock Bank (the "Bank "), among other
matters, without attachments.
3. Loan Agreement dated February 26, 2014 by and between the City and the Bank.
4. Incumbency Certificate.
5. Federal Tax Certificate.
6. Certificate as to Specimen Note.
7. Cross Receipt.
8. Closing Certificate of the City.
9. Internal Revenue Service Form 8038 -G, together with proof of filing letter.
10. Notice of Sale to Division of Bond Finance.
11. Division of Bond Finance Forms BF2003 and BF2004A and 2004B, together with proof
of filing.
12. Acceptance of Duties of Registrar and Paying Agent.
13. Signature Certificate.
14. Opinion of Akerman LLP, Bond Counsel.
15. Opinion of Brown, Garganese, Weiss & D'Agresta, P.A., City Attorney.
16. Lender's Letter.
17. Truth in Bonding Statement.
18. Florida Statute 218.385(6) Disclosure Statement.
19. Bank Qualified Certificate.
20. Closing Memorandum.
{28081572;1)
Distribution:
(2) City of Cape Canaveral (1) Akerman LLP
(1) Hancock Bank (1) Brown, Garganese, Weiss & D'Agresta, P.A.
(1) Bryant Miller Olive P.A. (1) Larson Consulting Services, LLC
t28081572; I ) 2
No. 1
CERTIFICATE REGARDING ORDINANCE NO. 03 -2014
The undersigned, a duly appointed, qualified and acting City Clerk of the City of Cape
Canaveral, Florida (the "City "), and the keeper of the records of the City, HEREBY CERTIFIES
that:
Attached hereto is a copy of Ordinance No. 03 -2014 of the City which was
adopted on second reading at a meeting of the City Council duly called
and held on February 18, 2014, at which meeting a quorum was present
and acting throughout, which ordinance has been compared by me with
the original thereof as recorded in the Minute Book of said City and that
said ordinance is a true, complete and correct copy thereof, and said
ordinance has been duly adopted and has not been repealed or amended
and is in full force and effect on and as of the date hereof in the form
attached hereto.
IN WITNESS WHEREOF; I have hereunto set my hand and affixed the official seal of
the City as of this 26th day of February, 2014.
CITY OF CAPE CANAVERAL, FLORIDA
[SEAL]
qz�4 k �ptx�
City Clerk
{281 16440;1 }
ORDINANCE NO. 03-2014
AN ORDINANCE OF THE CITY OF CAPE CANAVERAL, BREVARD
COUNTY, FLORIDA, ADOPTED IN FURTHERANCE OF THE
REQUIREMENT SET FORTH IN SECTION 2.12(5), CAPE CANAVERAL
CHARTER; AUTHORIZING THE ISSUANCE OF NOT EXCEEDING
$5,500,000 CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014,
OF THE CITY TO FINANCE THE COST OF A CITY HALL, FIRE
STATION, REFURBISHMENT OF A WASTEWATER TREATMENT
PLANT AND RELATED CAPITAL IMPROVEMENTS; PROVIDING
FOR THE SERIES 2014 NOTE TO BE SECURED BY THE CITY'S
PUBLIC SERVICE TAX, HALF -CENT SALES TAX, GUARANTEED
ENTITLEMENT, COMMUNICATIONS SERVICES TAX AND CERTAIN
FRANCHISE FEES; AUTHORIZING THE CITY'S FINANCING TEAM
TO PROCEED TO DEVELOP NECESSARY DOCUMENTS; PROVIDING
FOR THE REPEAL OF PRIOR INCONSISTENT ORDINANCES OR
PARTS OF PRIOR INCONSISTENT ORDINANCES IN CONFLICT
HEREWITH; PROVIDING FOR A SEVERABILITY CLAUSE;
PROVIDING AN EFFECTIVE DATE.
BE IT ENACTED BY THE CITY COUNCIL OF THE CITY OF CAPE
CANAVERAL, BREVARD COUNTY, FLORIDA, as follows:
SECTION 1. Authority for this Ordinance.
This Ordinance is enacted pursuant to the provisions of Chapter 166, Part II, Florida
Statutes, Section 2.12(5) of the City Charter, City of Cape Canaveral, Florida (the "City ") and
other applicable provisions of law (the "Act ").
SECTION 2. Findings.
It is hereby ascertained, determined and declared that:
(A) The City (i) pursuant to Section 166.231, Florida Statutes and certain ordinances,
levies a tax on the purchase of certain utility services provided within the jurisdictional limits of
the City (the "Public Service Tax "); (ii) pursuant to the provisions of Chapter 218, Part VI,
Florida Statutes, receives a distribution from the Local Government Half -Cent Sales Tax
Clearing Trust Fund (the "Half -Cent Sales Tax ") (iii) in accordance with the provisions of
Chapter 218, Part II, Florida Statutes, receives funds from the Revenue Sharing Trust Fund for
(27526782;7) Page 1 of 5
City of Cape Canaveral, Florida
Ordinance No. 03 -2014
Page 2
Municipalities, a portion of which distribution is the "guaranteed entitlement" as defined in
Section 218.21, Florida Statutes (the "Guaranteed Entitlement "); (iv) pursuant to the
authorization set forth in Chapter 202, Florida Statues, the City receives the Communications
Services Tax (the "Communications Services Tax ") and (v) receives fees as a result of granting
various entities permission to provide within the City electric and directly electric- related
services, and a natural gas distribution system (collectively, the "Franchise Fees "). Such Public
Service Tax, Half -Cent Sales Tax, Guaranteed Entitlement, Communications Services Tax and
Franchise Fees are not now pledged in any manner.
(B) The City is without currently available funds to pay for all of the costs of
acquiring and constructing a City Hall and a Fire Station and related capital improvements and
rebuilding the main wastewater treatment plant building and related improvements (the
"Project "), and therefore proposes to pay a portion of such costs thereof from the proceeds of its
not exceeding $5,500,000 Capital Improvement Revenue Note, Series 2014 (the "Series 2014
Note ") to be issued by the City.
(C) The principal of, premium, if any, and interest on the Series 2014 Note and all
required sinking fund, reserves and other payments will be payable solely from (i) the Public
Service Tax, the Half -Cent Sales Tax, the Guaranteed Entitlement, the Communications Services
Tax and the Franchise Fees and (ii) until applied in accordance with the provisions of a
supplemental resolution (the "Resolution ") of the City adopted prior to the delivery of the Series
2014 Note, all moneys, including investments thereof, on deposit in or credited to certain funds
and accounts established under the Resolution (collectively with (i) above, the "Pledged
Revenues ") and the City will never be required to levy ad valorem taxes on any property therein
(27526782;7) Page 2 of 5
City of Cape Canaveral, Florida
Ordinance No. 03 -2014
Page 3
to pay the principal of and interest on the Series 2014 Note or to make any other payments
provided for herein or in the Resolution, and the Series 2014 Note will not constitute a lien upon
any properties owned by the City or located within the boundaries of the City, but will be
payable solely from the Pledged Revenues in the manner provided in this Ordinance and in the
Resolution supplemental hereto.
(D) It is necessary and desirable to confirm the professionals who will continue to
assist the City in the proceedings necessary for the authorization, sale, and issuance of the Series
2014 Note and investment of proceeds of the Series 2014 Note.
SECTION 3. Authorization of Series 2014 Note and Acquisition and Construction
of Project.
The issuance by the City of its not exceeding $5,500,000 Capital Improvement Revenue
Note, Series 2014 for the purpose of paying costs of acquiring and constructing the Project and
the cost of issuance for the "Series 2014 Note" is hereby authorized. The Series 2014 Note shall
be dated, shall bear interest at a rate or rates not exceeding the maximum legal rate per annum,
shall mature, shall be subject to redemption, shall be secured solely by a lien upon and pledge of
the Pledged Revenues, and shall have such other characteristics as shall be provided by the
Resolution. Any Note(s) required by the lender shall be in form approved by the City Manager in
consultation with the Finance Team consistent with the terms and conditions of this Ordinance.
SECTION 4. Designation of Finance Team and Approval of Terms of Engagement.
The Finance Team with respect to the Series 2014 Note shall consist of: Larson
Consulting Services, LLC, as Financial Advisor to the City, Akerman LLP as Bond Counsel,
Brown, Garganese, Weiss & D'Agresta, PA as City Attorney, the City Manager, the Finance
{27526782;7} Page 3 of 5
City of Cape Canaveral, Florida
Ordinance No. 03 -2014
Page 4
Director, and the City Clerk (the "Finance Team "). Under the direction of the City Manager, the
Finance Team is hereby approved and shall take such action, and execute such documents on
behalf of the City, deemed reasonably necessary to effectuate the loan closing authorized by this
Ordinance. In addition, to the extent required by the lending institution and deemed advisable by
the Finance Team, the Mayor or Mayor Pro Tem is hereby authorized to execute loan documents
on behalf of the City.
SECTION 5. Conflicting Prior Inconsistent Ordinances.
All prior inconsistent ordinances or parts of prior inconsistent ordinances in conflict
herewith are hereby repealed and all prior inconsistent ordinances or parts of prior inconsistent
ordinances not in conflict herewith are hereby continued in full force and effect.
SECTION 6. Severability.
If any portion, clause, phrase, sentence or classification of this ordinance is held or
declared to be either unconstitutional, invalid, inapplicable, inoperative or void, then such
declaration shall not be construed to affect other portions of this ordinance; it is hereby declared
to be the express opinion of the City Council of the City of Cape Canaveral that any such
unconstitutional, invalid, inapplicable, inoperative or void portion or portions of this ordinance
did not induce its passage, and that without the inclusion of any such portion or portions of this
ordinance, the City Council would have enacted the valid constitutional portions thereof.
[Remainder of Page Intentionally Left Blank]
(27526782 ;7) Page 4 of 5
City of Cape Canaveral, Florida
Ordinance No. 03 -2014
Page 5
SECTION 7. The provisions within this Ordinance shall take effect immediately
upon the adoption date.
ADOPTED by the City Council of the City of Cape Canaveral, Florida, this 18th day of
February, 2014.
CITY OF CAPE C AVERAL, FLORIDA
r
Rocky Randels, Mayor or
Buzz Petsos, Mayor Pro Tern
ATTEST
For Against
Angela Apperson, City Clerk
John Bond X (second)
Bob Hoog X (motion)
Buzz Petsos X
Rocky Randels Absent
Betty Walsh X
First Reading: January 21, 2014
Legal Ad published: January 30, 2014
Second Reading: February 18, 2014
Approved as to legal form and
sufficiency for the City of
Cape Can veral only
Anthony A. Garganese, City Attorney
{27526782;71 Page 5 of 5
No. 2
CERTIFICATE REGARDING RESOLUTION No. 2014 -05
The undersigned, a duly appointed, qualified and acting City Clerk of the City of Cape
Canaveral, Florida (the "City "), and the keeper of the records of the City, HEREBY CERTIFIES
that:
Attached hereto is a copy of Resolution No. 2014 -05 of the City which
was adopted at a meeting of the City Council duly called and held on
February 18, 2014, at which meeting a quorum was present and acting
throughout, which resolution has been compared by me with the original
thereof as recorded in the Minute Book of said City and that said
resolution is a true, complete and correct copy thereof, and said resolution
has been duly adopted and has not been repealed or amended and is in full
force and effect on and as of the date hereof in the form attached hereto.
IN WITNESS WHEREOF; I have hereunto set my hand and affixed the official seal of
the City as of this 26`h day of February, 2014.
CITY OF CAPE CANAVERAL, FLORIDA
[SEAL]
City C erk
{28116454;1}
RESOLUTION NO. 2014-05
A RESOLUTION OF THE CITY OF CAPE CANAVERAL, FLORIDA,
SUPPLEMENTING CITY ORDINANCE NO. 03 -2014 ENACTED ON
FEBRUARY 18, 2014 BY ACCEPTING THE PROPOSAL OF HANCOCK
BANK TO PURCHASE THE CITY'S NOT TO EXCEED $5,500,000 CAPITAL
IMPROVEMENT REVENUE NOTE, SERIES 2014; AUTHORIZING THE
EXECUTION AND DELIVERY OF A LOAN AGREEMENT WITH SAID
BANK TO SECURE THE REPAYMENT OF SAID NOTE; AUTHORIZING
THE PROPER OFFICIALS OF THE CITY TO TAKE ANY OTHER ACTION
DEEMED NECESSARY OR ADVISABLE IN CONNECTION WITH THE
FINALIZATION AND EXECUTION OF THE LOAN AGREEMENT, THE
NOTE, AND THE SECURITY THEREFOR; AUTHORIZING THE
EXECUTION AND DELIVERY OF DOCUMENTS IN CONNECTION WITH
SAID LOAN; DESIGNATING THE NOTE AS "BANK QUALIFIED ";
PROVIDING FOR REPEAL OR SUPERSESSION OF PRIOR INCONSISTENT
CITY RESOLUTIONS OR ACTIONS; PROVIDING FOR SEVERABILITY
AND OTHER MATTERS IN REGARD THERETO; AND PROVIDING AN
EFFECTIVE DATE.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CAPE
CANAVERAL, FLORIDA, AS FOLLOWS:
AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted pursuant
to the provisions of Chapter 166, Part II, Florida Statutes, the Florida Constitution and other
applicable provisions of law and City Ordinance No. 03 -2014 enacted on February 18, 2014 (the
"Ordinance ").
FINDINGS. It is hereby ascertained, determined and declared:
The City of Cape Canaveral, Florida (the "City ") deems it necessary, desirable
and in the best interests of the City and its residents and that it serves a paramount public purpose
that the City issue its Capital Improvement Revenue Note, Series 2014 (the "2014 Note ") to
acquire and construct the Project as defined in the Ordinance, all as more particularly described
in the Ordinance and the Loan Agreement (as defined herein).
Pursuant to Section 2(b), Article VIII of the State Constitution, and Section
166.021, Florida Statutes, municipalities have the governmental, corporate and proprietary
powers to enable them to conduct municipal government, perform municipal functions, and
render municipal services, and may exercise any power for municipal purposes, except when
expressly prohibited by law. The issuance by the City of the 2014 Note to acquire and construct
the Project and the execution and delivery of the Loan Agreement to secure the 2014 Note is not
prohibited by law.
Based on the present volatility of the market for municipal debt in consultation
with the City's financial advisor, Larson Consulting Services, LLC, and following a review of the
bank responses from the City's RFP for the 2014 Note by the City's financial advisor and the City
City of Cape Canaveral
Resolution No. 2014 -05
Page 2 of 4
Manager and other members of City staff, and the City Council's decision on January 21, 2014
to proceed with the selection of the Bank (as defined below), it has been determined it is in the
best interest of the City to issue the 2014 Note pursuant to the Ordinance and the Loan
Agreement by negotiated sale, allowing the City to issue the 2014 Note at the most advantageous
time} allowing the City to obtain the best interest rate and other terms for the 2014 Note, and
accordingly, the City Council of the City hereby finds and determines that it is in the best
financial interest of the City that a negotiated sale of the 2014 Note to Hancock Bank (the
"Bank ") be authorized.
AUTHORIZATION OF ISSUANCE OF 2014 NOTE. The City hereby authorizes
issuance of the 2014 Note to acquire and construct the Project and to pay costs of issuing the
2014 Note as more particularly described in the Loan Agreement.
ACCEPTANCE OF TERMS AND CONDITIONS WITH BANK. Based on a
recommendation from the City's financial advisor and in consultation with the City staff, the City
hereby accepts the revised letter of the Bank dated January 21, 2014 attached hereto to provide
the City with the loan evidenced by the 2014 Note.
APPROVAL OF FORM OF AND AUTHORIZATION OF LOAN
AGREEMENT AND 2014 NOTE AND EXECUTION OF LOAN AGREEMENT AND 2014
NOTE. The repayment of the loan as evidenced by the 2014 Note shall be pursuant to the terms
and provisions of the Ordinance, the Loan Agreement and the 2014 Note. The City hereby
approves the Loan Agreement by and between the City and the Bank in substantially the form
attached hereto as EXHIBIT "A" (the "Loan Agreement ") and the 2014 Note and authorizes the
Mayor or the Mayor Pro Tern of the City (collectively, the "Mayor ") and the City Clerk or any
deputy or assistant City Clerk of the City (collectively, the "City Clerk ") to execute and deliver
on behalf of the City the Loan Agreement and the 2014 Note in substantially the form attached to
the Loan Agreement, with such changes, insertions and additions as they may approve, their
execution thereof being conclusive evidence of such approval.
PAYMENT OF DEBT SERVICE ON 2014 NOTE. Pursuant to the Loan
Agreement, the 2014 Note will be secured by the Pledged Revenues (as defined in the Ordinance
and the Loan Agreement).
AUTHORIZATION OF OTHER DOCUMENTS TO EFFECT TRANSACTION.
To the extent that other documents including but not limited to notices, certificates, opinions, or
other items are needed to effect any of the transactions referenced in this Resolution, the
Ordinance, the Loan Agreement, the 2014 Note, and the security therefor, the Mayor, the City
Clerk, the City Manager, the Administrative Services Director, the Finance Director, the City
Attorney, Financial Advisor and Bond Counsel are hereby authorized to execute and deliver such
documents, certificates, opinions, or other items and to take such other actions as are necessary
for the full, punctual, and complete performance of the covenants, agreements, provisions, and
other terms as are contained herein and in the documents included herein by reference.
City of Cape Canaveral
Resolution No. 2014 -05
Page 3 of 4
PAYING AGENT AND REGISTRAR. The City hereby accepts the duties to
serve as registrar and paying agent for the 2014 Note.
LIMITED OBLIGATION. The obligation of the City to repay amounts under the
Loan Agreement and the 2014 Note are limited and special obligations, payable solely from the
sources and in the manner set forth in the Loan Agreement and shall not be deemed a pledge of
the faith and credit or taxing power of the City.
DESIGNATION OF 2014 NOTE AS BANK QUALIFIED. The City designates
the 2014 Note as a "qualified tax - exempt obligation" within the meaning of Section 265(b)(3) of
the Internal Revenue Code of 1986, as amended (the "Code "). The City does not reasonably
anticipate that the City, any subordinate entities of the City, and issuers of debt that issue "on
behalf' of the City, will during the calendar year 2014 issue more than $10,000,000 of "tax -
exempt" obligations, exclusive of those obligations described in Section 265(b)(3)(C)(ii) of the
Code.
REPEAL OF PRIOR INCONSISTENT RESOLUTIONS AND ACTIONS. All
prior resolutions or actions of the City in conflict herewith are hereby superseded and repealed to
the extent of such conflict.
EFFECT OF PARTIAL INVALIDITY. If any one or more provisions of this
Resolution, the Loan Agreement, or the 2014 Note shall for any reason be held to be illegal or
invalid, such illegality or invalidity shall not affect any other provision of this Resolution, the
2014 Note or the Loan Agreement, but this Resolution, the Loan Agreement, and the 2014 Note
shall be construed and enforced as if such illegal or invalid provision had not been contained
therein. The 2014 Note shall be issued and Loan Agreement shall be executed and this
Resolution is adopted with the intent that the laws of the State of Florida shall govern their
construction.
adoption.
EFFECTIVE DATE. This Resolution shall take effect immediately upon its
[Remainder of Page Intentionally Left Blank]
City of Cape Canaveral
Resolution No. 2014 -05
Page 4 of 4
ADOPTED by the City Council of the City of Cape Canaveral, Florida, this 181' day of
February, 2014.
CITY OF CAPE CANAVERAL, FLORIDA
Petsos, Mayor Pro Tem
ATTEST
k
For
Angela Apperson, MMC
City Clerk
John Bond Motion
Bob Hoog x
Buzz Petsos x
Rocky Randels Absent
Betty Walsh SPrnnd
Approved as to legal form and sufficiency for the
City of Cape Canaveral only
By
Anthony A. Garganese, City Attorney
Against
LOAN AGREEMENT
Dated as of February 26, 2014
By and Between
THE CITY OF CAPE CANAVERAL, FLORIDA
and
HANCOCK BANK
(28004717;4)
TABLE OF CONTENTS
(The Table of Contents for this Loan Agreement is for convenience of reference only and
is not intended to define, limit or describe the scope or intent of any provisions of this Loan
Agreement.)
Page
ARTICLE I DEFINITION OF TERMS ................................................. ............................... 1
Section1.01.
Definitions .................................................................... ............................... 1
Section1.02.
Interpretation ................................................................ ............................... 4
Section 1.03.
Titles and Headings ...................................................... ............................... 4
ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE PARTIES ................. 4
Section 2.01.
Representations and Warranties of City ....................... ............................... 4
Section 2.02.
Covenants of the City ................................................... ............................... 5
Section 2.03.
Representations and Warranties of Bank ..................... ............................... 5
ARTICLEIII THE 2014 NOTE ................................................................ ............................... 5
Section 3.01.
Purpose and Use ........................................................... ............................... 5
Section3.02.
The 2014 Note .............................................................. ............................... 6
Section 3.03.
Adjustments to 2014 Note Rate .................................... ............................... 6
Section 3.04.
Conditions Precedent to Issuance of 2014 Note ........... ............................... 7
Section 3.05.
Registration of Transfer; Assignment of Rights of Bank ............................ 8
Section 3.06.
Ownership of the 2014 Note ......................................... ............................... 9
Section 3.07.
Use of Proceeds of 2014 Note Permitted Under Applicable Law ............... 9
Section 3.08.
Authentication .............................................................. ............................... 9
ARTICLE IV COVENANTS OF THE CITY ........................................... ............................... 9
Section 4.01.
Performance of Covenants ........................................... ............................... 9
Section 4.02.
Payment of 2014 Note .................................................. ............................... 9
Section 4.03.
Tax Covenant .............................................................. ............................... 10
Section 4.04.
Compliance with Laws and Regulations .................... ............................... 10
Section 4.05 Additional Debt .......................................................... ............................... 10
ARTICLE V EVENTS OF DEFAULT AND REMEDIES ................... ............................... 11
Section 5.01. Events Of Default ....................................................... ............................... 11
Section5.02. Remedies .................................................................... ............................... 11
Section 5.03. Remedies Cumulative ................................................. ............................... 11
ARTICLE VI MISCELLANEOUS PROVISIONS ................................ ............................... 12
Section 6.01. Covenants of City, Etc.; Successors ........................... ............................... 12
Section 6.02. Term of Agreement .................................................... ............................... 12
Section 6.03. Amendments and Supplements .................................. ............................... 12
Section6.04. Notices ........................................................................ ............................... 12
Section 6.05. Benefits Exclusive ...................................................... ............................... 13
Section6.06. Severability ................................................................. ............................... 13
Section 6.07. Payments Due on Saturdays, Sundays and Holidays . ............................... 13
Section 6.08. Counterparts ............................................................... ............................... 13
{28004717;4) i
Section 6.09. Applicable Law .......................................................... ............................... 13
Section 6.10. No Personal Liability .................................................. ............................... 13
Section 6.11. Incorporation by Reference ........................................ ............................... 14
Exhibit A Form of Note Including Purchaser's Certificate ................... ............................... A -1
(28004717;4) 11
LOAN AGREEMENT
THIS LOAN AGREEMENT (the "Agreement "), made and entered into this 26`" day of
February, 2014 by and between THE CITY OF CAPE CANAVERAL, FLORIDA (the
"City "), a municipal corporation of the State of Florida, and HANCOCK BANK, a Mississippi
state banking corporation authorized to do business in Florida, and its successors and assigns (the
"Bank"
WITNESSETH:
WHEREAS, capitalized terms used in these recitals and not otherwise defined shall have
the meanings specified in Article I of this Agreement;
WHEREAS, the City, pursuant to the provisions of the Florida Constitution, Chapter
166, Florida Statutes, Ordinance No. 03 -2014 (the "Ordinance ") and other applicable provisions
of law (all of the foregoing, collectively, the "Act "), and Resolution No. 2014 -05, adopted by the
City on February 18, 2014 (the "Resolution "), is authorized to borrow money, and more
particularly issue the 2014 Note described below for the City's public purposes; and
WHEREAS, in response to a request for proposal regarding an intended borrowing to
construct various City owned capital improvements including city hall, a fire station and
refurbishment of a wastewater treatment plant (the "Project "), the Bank submitted its revised
commitment, dated January 21, 2014 to the City (the "Commitment "); and
WHEREAS, the City has accepted the Commitment and the Bank is willing to purchase
the 2014 Note (as hereinafter defined), but only upon the terms and conditions of this
Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITION OF TERMS
Section 1.01. Definitions. Capitalized terms used in this Agreement shall have the
respective meanings as follows unless the context clearly requires otherwise:
"Act" shall have the meaning assigned to that term in the recitals hereof.
"Agreement" shall mean this Loan Agreement and all modifications, alterations,
amendments and supplements hereto made in accordance with the provisions hereof.
"Authorized Denominations" shall mean $1,000 and integral multiples thereof.
"Bank" shall mean Hancock Bank, a Mississippi state banking corporation, and its
successors and assigns.
{28004717;4}
"Bond Counsel" shall mean, Akerman LLP, or any other attorney at law or firm of
attorneys of nationally recognized standing in matters pertaining to the exclusion of interest on
obligations issued by states and political subdivisions from federal income taxation hired by the
City to render an opinion on such matters with regard to the 2014 Note.
"Business Day" shall mean any day other than a Saturday, a Sunday, or a day on which
the office of the Holder at which payments on the 2014 Note are due or the offices of the City are
lawfully closed.
"City" shall mean the City of Cape Canaveral, Florida, a municipal corporation of the
State of Florida.
"City Clerk" shall mean the Administrative Services Director or any deputy or assistant
city clerk of the City and such other person as may be duly authorized to act on his or her behalf.
"City Manager" shall mean the City Manager of the City and such other person as may be
duly authorized to act on his or her behalf.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to time,
and the applicable rules and regulations promulgated thereunder.
"Communications Services Taxes" shall mean the taxes on local communications
services levied on the City pursuant to section 202.19(1), Florida Statutes.
"Communications Services Tax Revenues" shall mean all revenues received by the Issuer
from the levy of Communications Services Taxes.
"Debt Service" means principal and interest, and other debt - related costs, due in
connection with the 2014 Note, as applicable.
"Default Rate" shall mean the 2014 Note Rate plus five percent (5.0 %) provided such rate
shall not exceed the highest rate of interest allowed by applicable law.
"Determination of Taxability" shall mean, with respect to the 2014 Note, any
determination, decision or decree by the Commissioner or any District Director of the Internal
Revenue Service, as such officers are identified by the Code, or any court of competent
jurisdiction, or delivery of an opinion of Bond Counsel, that the interest payable under the 2014
Note is includable in the gross income (as defined in Section 61 of the Code) of the Holder.
"Event of Default" shall mean an Event of Default as defined in Section 5.01 of this
Agreement.
"Finance Director" shall mean the City's Finance Director or such other person as may be
duly authorized to act on his or her behalf.
"Franchise Fees" shall mean collectively the franchise fees received by the City pursuant
to that agreement known as "Cape Canaveral Natural Gas Franchise," and the franchise fees
{28004717;4} 2
received by the City from Florida Power and Light Company pursuant to a City ordinance
adopted on August 16, 2011.
"Financial Advisor" shall mean Larson Consulting Services, LLC.
"Fiscal Year" shall mean the 12 -month period commencing October 1 of each year and
ending on the succeeding September 30, or such other 12 -month period as the City may
designate as its "fiscal year" as permitted by law.
"Guaranteed Entitlement" means the guaranteed entitlement portion of the state revenue
sharing funds available to the City pursuant to Part II of Chapter 218, Florida Statues.
"Half -Cent Sales Tax" means any and all proceeds of the local government half -cent sales
tax distributed to the City from the Local Government Half -Cent Sales Tax Clearing Trust Fund,
as defined and described in Part VI, Chapter 218, Florida Statues, as amended.
"Holder" shall mean the Bank as the initial holder of the 2014 Note and any subsequent
registered holder of the 2014 Note.
"Loan" shall refer to an amount equal to the outstanding principal of the 2014 Note,
together with unpaid interest and penalties, if any, which have accrued.
"Maturity Date" shall mean the date on which all principal and all unpaid interest accrued
on the 2014 Note shall be due and payable in full, which date shall be, if not sooner due to
prepayment, February 1, 2024.
"Payment Date" shall mean each February 1 and August 1, commencing August 1, 2014
until the 2014 Note has been paid in full.
"Pledged Revenues" shall mean collectively the Communications Services Tax
Revenues, the Public Services Tax Revenues, the Guaranteed Entitlement, the Half -Cent Sales
Tax, the Franchise Fees and amounts on deposit in the Debt Service Fund.
"Public Services Tax" shall mean such tax as levied and collected by the City pursuant to
the authority of Section 166.231, Florida Statutes.
"Public Services Tax Revenues" shall mean all revenues received by the Issuer from the
levy of the Public Services Tax.
"Resolution" shall mean Resolution No. 2014 -05, adopted at a meeting of the City
Council on February 18, 2014, which, among other things, authorized the execution and delivery
of this Agreement and the issuance of the 2014 Note.
"2014 Note" shall mean the City of Cape Canaveral, Florida Capital Improvement
Revenue Note, Series 2014.
{28004717;4} 3
"2014 Note Rate" shall mean the rate of interest to be borne by the 2014 Note which shall
be a fixed rate equal to 1.99% per annum calculated on the basis of a 360 -day year of 12, 30 -day
months. The 2014 Note Rate is subject to adjustment as provided herein.
Section 1.02. Interpretation. Unless the context clearly requires otherwise, words of
masculine gender shall be construed to include correlative words of the feminine and neuter
genders and vice versa, and words of the singular number shall be construed to include
correlative words of the plural number and vice versa. This Agreement and all the terms and
provisions hereof shall be construed to effectuate the purpose set forth herein and to sustain the
validity hereof.
Section 1.03. Titles and Headings. The titles and headings of the Articles and Sections
of this Agreement, which have been inserted for convenience of reference only and are not to be
considered a part hereof, shall not in any way modify or restrict any of the terms and provisions
hereof, and shall not be considered or given any effect in construing this Agreement or any
provision hereof or in ascertaining intent, if any question of intent should arise.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
Section 2.01. Representations and Warranties of City. The City represents and
warrants to the Bank as follows:
(a) Existence. The City is a municipal corporation of the State of Florida, duly
created and validly existing under the laws of the State of Florida, with full power to enter into
this Agreement, to perform its obligations hereunder and to issue and deliver the 2014 Note to
the Bank. The making, execution and performance of this Agreement on the part of the City and
the issuance and delivery of the 2014 Note has been duly authorized by all necessary action on
the part of the City and will not violate or conflict with the Act, City Charter, or any agreement,
indenture or other instrument by which the City or any of its material properties is bound.
(b) Validity, Etc. This Agreement, the 2014 Note and the Resolution are valid and
binding obligations of the City enforceable against the City in accordance with their respective
terms, except to the extent that enforceability may be subject to valid bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or from time to time affecting the
enforcement of creditors' rights and except to the extent that the availability of certain remedies
may be precluded by general principles of equity.
(c) No Financial Material Adverse Change. No material adverse change in the
financial condition of the City or the Pledged Revenues has occurred since the audited financial
statements of the City for its year ended September 30, 2012.
(d) Powers of City. The City has the legal power and authority to pledge the Pledged
Revenues to the repayment of the 2014 Note as described herein and none of the Pledged
Revenues are pledged to any other obligations of the City.
128004717;4) 4
(e) Authorizations, etc. No authorization, consent, approval, license, exemption of or
registration or filing with any court or governmental department, council, board, bureau, agency
or instrumentality, domestic or foreign, has been or will be necessary for the valid execution,
delivery and performance by the City of this Agreement, the 2014 Note and the related
documents, except such as have been obtained, given or accomplished.
Section 2.02. Covenants of the City. The City covenants as follows:
At no costs to the Bank, the City will furnish to the Bank (i) within 210 days following
the end of each Fiscal Year, a comprehensive annual financial report of the City for such Fiscal
Year prepared in accordance with generally accepted accounting standards, which shall include a
balance sheet and income statement as of the end of such Fiscal Year, and an audit report of an
independent certified public accountant or firm thereof, (ii) any other financial information,
including but not limited to the City's annual budget, which the Bank may reasonably request.
Section 2.03. Representations and Warranties of Bank. The Bank represents and
warrants to the City as follows:
(a) Existence. The Bank is a Mississippi state banking corporation, authorized to do
business in the State of Florida, with full power to enter into this Agreement, to perform its
obligations hereunder and to make the Loan. The performance of this Agreement on the part of
the Bank and the making of the Loan have been duly authorized by all necessary action on the
part of the Bank and will not violate or conflict with applicable law or any material agreement,
indenture or other instrument by which the Bank or any of its material properties is bound.
(b) Validity. This Agreement is a valid and binding obligation of the Bank
enforceable against the Bank in accordance with its terms, except to the extent that enforceability
may be subject to valid bankruptcy, insolvency, financial emergency, reorganization, moratorium
or similar laws relating to or from time to time affecting the enforcement of creditors' rights (and
specifically creditors' rights as the same relate to banks) and except to the extent that the
availability of certain remedies may be precluded by general principles of equity.
(c) Knowledge and Experience. The Bank (i) has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and risks of making the
Loan and purchasing in the 2014 Note, (ii) bas received and reviewed such financial information
concerning the Pledged Revenues as it has needed in order to fairly evaluate the merits and risks
of making the Loan and purchasing in the 2014 Note; and (iii) is purchasing the 2014 Note as an
investment for its own account and not with a current view toward resale to the public.
ARTICLE III
THE 2014 NOTE
Section 3.01. Purpose and Use. On the date of this Agreement, the Bank shall fund to
the City the Loan in the principal amount of Five Million Five Hundred Thousand Dollars
($5,500,000). The Loan will be evidenced by the 2014 Note. The proceeds of the 2014 Note
shall be used solely to construct and reconstruct the Project and to pay costs of issuing the 2014
Note.
{28004717;4} 5
Section 3.02. The 2014 Note. The 2014 Note shall be substantially in the form set forth
as Exhibit A to this Agreement. The general terms of the 2014 Note shall be as follows:
(a) Amount of 2014 Note. The aggregate principal amount of the 2014 Note shall be
Five Million Five Hundred Thousand Dollars ($5,500,000).
(b) Interest. The 2014 Note shall bear interest at the 2014 Note Rate payable on each
Payment Date. The 2014 Note Rate shall be subject to adjustment as provided in Section 3.03
hereof. The 2014 Holder shall promptly notify the City in writing of any adjustments in a 2014
Note Rate. Notwithstanding any provision hereof the contrary, in no event shall the interest rate
on the 2014 Note exceed the maximum rate permitted by law. Interest on the 2014 Note shall be
computed on the basis of 12, 30 -day months and a 360 -day year.
(c) Prepayments and Principal Pants. The 2014 Note shall be subject to
prepayment at the option of the City, without any prepayment penalty or fee as provided in the
2014 Note. Any prepayment shall be made on such date as shall be specified by the City in a
written notice delivered to the 2014 Holder not less than ten (10) days prior to the specified
prepayment date. Any prepayment shall be applied first to accrued interest, then to other
amounts owed the Holder, and finally to principal in inverse order of maturity in Authorized
Denominations.
Principal on the 2014 Note is payable on each February 1 commencing February 1, 2015
as set forth in the 2014 Note.
Section 3.03. Adjustments to 2014 Note Rate. The 2014 Note Rate shall be subject to
adjustment by the Bank as hereinafter described and as provided in the 2014 Note.
In the event of a Determination of Taxability, the 2014 Note Rate shall be adjusted to
cause the yield on such 2014 Note to equal what the yield on that 2014 Note would have been
absent such Determination of Taxability (the "Taxable Rate ") effective retroactively to the
effective date of such Determination of Taxability. Immediately upon a Determination of
Taxability, the City agrees to pay to the Holder subject to such Determination of Taxability the
Additional Amount (as defined herein). "Additional Amount" means (i) the difference between
(a) interest on such 2014 Note for the period commencing on the date on which the interest on
such 2014 Note (or portion thereof) loses its "tax- exempt" status and ending on the earlier of the
date such 2014 Note ceased to be outstanding or such adjustment is no longer applicable to such
2014 Note (the "Taxable Period ") at a rate equal to the Taxable Rate and (b) the aggregate
amount of interest payable on such 2014 Note for the Taxable Period under the provisions of
such 2014 Note without considering the Determination of Taxability that has been paid to the
Holder, plus (ii) any penalties and interest paid or payable by such Holder to the Internal
Revenue Service by reason of such Determination of Taxability.
If the 2014 Note ceases to be a "qualified tax - exempt obligation" then the 2014 Note Rate
shall be adjusted to cause the yield on the 2014 Note to equal what the yield on the 2014 Note
would have been in the absence of such change.
The Holder shall promptly notify the City in writing of any adjustments pursuant hereto.
Such adjustments shall become effective as of the effective date of the event causing such
{28004717;4} 6
adjustment. Adjustments pursuant hereto may be retroactive. The 2014 Holder shall certify to
the City in writing the additional amount, if any, due to the 2014 Holder as a result of an
adjustment pursuant hereto. Notwithstanding any provision here to the contrary, in no event
shall the interest rate on the 2014 Note exceed the maximum rate permitted by law.
Section 3.04. Conditions Precedent to Issuance of 2014 Note. Prior to or
simultaneously with the delivery of the 2014 Note, there shall be filed with the Bank the
following, each in form and substance reasonably acceptable to the Bank:
(a) an opinion of legal counsel to the City substantially to the effect that (i) the
Resolution and Ordinance have been duly adopted and this Agreement and the 2014 Note have
been duly authorized, executed and delivered by the City and each constitutes a valid, binding
and enforceable agreement of the City in accordance with their respective terms, except to the
extent that the enforceability of the rights and remedies set forth therein may be limited by
bankruptcy, insolvency, or other laws affecting creditors' rights generally or by usual equity
principles; (ii) the City's execution, delivery and performance of this Agreement and execution
and issuance of the 2014 Note are not subject to any authorization, consent, approval or review
of any governmental body, public officer or regulatory authority not heretofore obtained or
effected; (iii) the execution, issuance and delivery of the 2014 Note has been duly and validly
authorized by the City, and the 2014 Note constitutes a valid and binding special obligation of
the City enforceable in accordance with its terms; (iv) the City (A) is a municipal corporation
duly organized and validly existing under the laws of the State of Florida, and (B) has power and
authority to adopt the Resolution and Ordinance, to execute and deliver this Agreement, to
execute and deliver the 2014 Note, and to consummate the transactions contemplated by such
instruments; (v) the execution, delivery and performance of the 2014 Note and this Agreement,
and compliance with the terms thereof and hereof, under the circumstances contemplated hereby,
do not and will not in any material respect conflict with, or constitute on the part of the City a
breach or default under, any indenture, mortgage, deed of trust, agreement or other instrument to
which the City or to which its properties are subject or conflict with, violate or result in a breach
of any existing law, administrative rule or regulation, judgment, court order or consent decree to
which the City or its properties are subject; (vi) there is no claim, action, suit, proceeding,
inquiry, investigation, litigation or other proceeding, at law or in equity, pending or to the best of
such counsel's knowledge, threatened, in any court or other tribunal, state or federal (A)
restraining or enjoining, or seeking to restrain or enjoin, the issuance, sale, execution or delivery
of the 2014 Note, (B) in any way questioning or affecting the validity or enforceability of any
provision of this Agreement, the 2014 Note, the Resolution or the Ordinance, (C) in any way
questioning or affecting the validity of any of the proceedings or authority for the authorization,
sale, execution or delivery of the 2014 Note, or of any provision made or authorized for the
payment thereof, or (D) questioning or affecting the organization or existence of the City or the
right of any of its officers to their respective offices; (vii) the City has the legal authority to
construct the Project, to grant a lien on the Pledged Revenues as described herein and in the
Resolution; and (viii) all conditions contained in the ordinances and resolutions of the City
precedent to the issuance of the 2014 Note have been complied with;
(b) an opinion of Bond Counsel (who may rely on opinion of legal counsel to the
City), substantially to such effect that such counsel is of the opinion that: (i) this Loan
Agreement constitutes a valid and binding obligation of the City enforceable upon the City in
128004717;4} 7
accordance with its terms; (ii) the 2014 Note is a valid and binding special obligation of the City
enforceable in accordance with its terms, payable solely from the sources provided therefor in
this Loan Agreement; (iii) assuming compliance by the City with certain covenants relating to
requirements contained in the Code interest on the 2014 Note is excluded from gross income for
purposes of federal income taxation; and (iv) the 2014 Note is a "qualified tax - exempt
obligation" within the meaning of Section 265(b)(3) of the Code;
(c) a copy of a completed and executed Form 8038 -G to be filed with the Internal
Revenue Service by the City;
(d) the original executed 2014 Note and Agreement; and
(e) such other documents as the Bank reasonably may request (including, without
limitation, Florida Division of Bond Finance forms).
When the documents and items mentioned in clauses (a) through (e), inclusive, of this
Section shall have been filed with the Bank, and when the 2014 Note shall have been executed as
required by this Agreement, the City shall deliver the 2014 Note to or upon the order of the Bank
upon receipt of the purchase price therefor.
Section 3.05. Registration of Transfer; Assignment of Rights of Bank. The City as
the registrar shall keep at the office of the City Clerk in the City's records the registration of the
2014 Note and the registration of transfers of the 2014 Note as provided in this Agreement. The
transfer of the 2014 Note may be registered only upon the books kept for the registration of the
2014 Note and registration of transfer thereof upon surrender thereof to the City as registrar
together with an assignment duly executed by the 2014 Holder or its attorney or legal
representative in the form of the assignment set forth on the form of the 2014 Note attached as
Exhibit A to this Agreement; provided, however, that such 2014 Note may be transferred only in
whole and not in part. In the case of any such registration of transfer, the City shall execute and
deliver in exchange for the 2014 Note a new 2014 Note registered in the name of the transferee.
In all cases in which a 2014 Note shall be transferred hereunder, the City shall execute and
deliver at the earliest practicable time a new 2014 Note in accordance with the provisions of this
Agreement. The City may make a charge for every such registration of transfer of a 2014 Note
sufficient to reimburse it for any tax or other governmental charges required to be paid with
respect to such registration of transfer, but no other charge shall be made for registering the
transfer hereinabove granted. The 2014 Note shall be issued in fully registered form and shall be
payable in any lawful coin or currency of the United States.
The registration of transfer of a 2014 Note on the registration books of the City shall be
deemed to effect a transfer of the rights and obligations of the Bank under this Agreement to the
transferee. Thereafter, such transferee shall be deemed to be the Bank under this Agreement and
shall be bound by all provisions of this Agreement that are binding upon the Bank. The City and
the transferor shall execute and record such instruments and take such other actions as the City
and such transferee may reasonably request in order to confirm that such transferee has
succeeded to the capacity of Bank under this Agreement and the 2014 Note.
(28004717;4) 8
No transfer shall be permitted absent the City's receipt of a certificate in form and
substance similar to the one included as part of Exhibit A hereto from such proposed transferee.
Every prior Holder of a 2014 Note shall be deemed to have waived and renounced all of such
owner's equities or rights therein in favor of every bona fide purchaser, and every such bona fide
purchaser shall acquire absolute title thereto and to all rights represented thereby.
In the event any 2014 Note is mutilated, lost, stolen, or destroyed, the City shall execute a
new 2014 Note of like date and denomination as that mutilated, lost, stolen or destroyed,
provided that, in the case of any mutilated 2014 Note, such mutilated 2014 Note shall first be
surrendered to the City, and in the case of any lost, stolen, or destroyed 2014 Note, there first
shall be furnished to the City evidence of such loss, theft or destruction together with an
indemnity satisfactory to it.
Section 3.06. Ownership of the 2014 Note. The person in whose name a 2014 Note is
registered shall be deemed and regarded as the absolute owner thereof for all purposes, and
payment of or on account of a 2014 Note shall be made only to the Holder thereof or such
owner's legal representative. All such payments shall be valid and effectual to satisfy and
discharge the liability upon the 2014 Note, and interest thereon, to the extent of the sum or sums
so paid.
Section 3.07. Use of Proceeds of 2014 Note Permitted Under Applicable Law. The
City represents, warrants and covenants that the proceeds of the 2014 Note will be used as
provided in Section 3.01 hereof, and that such use is permitted by applicable law.
Section 3.08. Authentication. Until a 2014 Note shall have endorsed thereon a
certificate of authentication substantially in the form set forth in Exhibit A, duly executed by the
manual signature of the City Clerk as registrar as authenticating agent, it shall not be entitled to
any benefit or security under this Loan Agreement. A 2014 Note shall not be valid or obligatory
for any purpose unless and until such certificate of authentication shall have been duly executed
by the registrar, and such certificate of the registrar upon a 2014 Note shall be conclusive
evidence that such 2014 Note has been duly authenticated and delivered under this Loan
Agreement.
ARTICLE IV
COVENANTS OF THE CITY
Section 4.01. Performance of Covenants. The City covenants that it will perform
faithfully at all times its covenants, undertakings and agreements contained in this Agreement
and the 2014 Note and in any proceedings of the City relating to the Loan provided that any
payments due hereunder shall be paid solely from Pledged Revenues.
Section 4.02. Payment of 2014 Note.
(a) The City does hereby irrevocably pledge the Pledged Revenues as security for the
repayment of the 2014 Note.
(28004717;4) 9
(b) The 2014 Note is a special obligation of the City secured solely by the Pledged
Revenues and payable from the Pledged Revenues as provided in this Agreement. The 2014
Note will not constitute a general debt, liability or obligation of the City or the State of Florida or
any political subdivision thereof within the meaning of any constitutional or statutory limitation.
Neither the faith and credit nor the taxing power of the City or of the State of Florida or any
political subdivision thereof is pledged to the payment of the principal of or interest on the 2014
Note and the 2014 Holder shall never have the right to compel any exercise of any ad valorem
taxing power of the City or of the State of Florida or any political subdivision thereof, directly or
indirectly to enforce such payment. The 2014 Note shall not constitute a lien upon any property
of the City except upon the Pledged Revenues.
Section 4.03. Tax Covenant. The City covenants to the 2014 Holder that the City will
not make any use of the proceeds of the 2014 Note at any time during the term of such Note
which, if such use had been reasonably expected on the date the 2014 Note was issued, would
have caused such Note to be an "arbitrage bond" within the meaning of the Code. The City will
do all acts including complying with the requirements of the Code and any valid and applicable
rules and regulations promulgated thereunder necessary to insure the exclusion of interest on the
2014 Note from the gross income of the Holders thereof for purposes of federal income taxation.
Section 4.04. Compliance with Laws and Regulations. The City shall maintain
compliance with all federal, state and local laws and regulations applicable to the construction
and improvements of the Project and the Loan.
Section 4.05. Additional Debt. As long as the 2014 Note is outstanding, the City shall
not issue any debt payable from any of the Pledged Revenues on a parity with the 2014 Note
unless there shall have been obtained and filed with the City and the Holder of the 2014 Note a
certificate of the City's Finance Director (i) setting forth the amount of Pledged Revenues for the
Fiscal Year immediately preceding the issuance of such additional debt; (ii) stating that such
Pledged Revenues equal at least 1.50 times the maximum debt service for all outstanding debt
secured by and payable from a first lien on such Pledged Revenues and such additional proposed
debt; and (iii) stating either that no Event of Default has occurred or if such Event of Default has
occurred that it shall have been cured. For purposes of such calculation if the interest rate on the
proposed additional debt will be a variable interest rate, the rate for purposes hereof shall be
calculated at the initial rate.
Section 4.06. Debt Service Fund. There is hereby created the City of Cape Canaveral
Capital Improvement Debt Service Fund (the "Debt Service Fund ") which fund shall be held by
the Bank. Commencing March 25, 2014 and no later than the 25th day of each month thereafter
the City shall deposit to the Debt Service Fund an amount equal to at least one -sixth (1/6 1h) of the
interest coming due on the 2014 Note on the next Payment Date and an amount equal to at least
one - twelfth (1/12) of the principal amount coming due on the 2014 Note on the next February 1.
The City shall adjust the amount of any deposit to the Debt Service Fund so as to provide
sufficient moneys therein to pay the amounts due on any Payment Date. Amounts on deposit in
the Debt Service Fund shall be used solely for making payments on the 2014 Note.
{28004717;4} 10
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
Section 5.01. Events Of Default. The following events shall each constitute an "Event
of Default:"
(a) The City defaults in the payment of the principal of or interest on the 2014 Note
when due.
(b) There shall occur the dissolution or liquidation of the City, or the filing by the
City of a voluntary petition in bankruptcy, or the commission by the City of any act of
bankruptcy, or adjudication of the City as a bankrupt, or assignment by the City for the benefit of
its creditors, or appointment of a receiver for the City, or the entry by the City into an agreement
of composition with its creditors, or the approval by a court of competent jurisdiction of a
petition applicable to the City in any proceeding for its reorganization instituted under the
provisions of the Federal Bankruptcy Act, as amended, or under any similar act in any
jurisdiction which may now be in effect or hereafter enacted.
(c) The City shall default in the due and punctual performance of any other of the
covenants, conditions, agreements and provisions contained in the 2014 Note or in this
Agreement on the part of the City to be performed, and such default shall continue for a period
of thirty days after written notice of such default shall have been received from the Holders of
the 2014 Note. Notwithstanding the foregoing, the City shall not be deemed in default hereunder
if such default can be cured within a reasonable period of time and if the City in good faith
institutes curative action and diligently pursues such action until the default has been corrected.
The City shall notify the Holder of any Event of Default within 2 days of discovery
thereof.
Section 5.02. Remedies. A Holder of the 2014 Note or any trustee or receiver acting for
such Holder 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, or granted and contained in this Agreement, and may enforce and compel the performance
of all duties required by this Agreement or by any applicable statutes to be performed by the City
or by any officer thereof. If any debt payable from the Pledged Revenues on parity with the
2014 Note is accelerated the Holder shall have the right to declare the 2014 Note immediately
due and payable. The City shall pay the Holder the reasonable fees and costs incurred by the
Holder and its agents in pursuing such remedies.
Section 5.03. Remedies Cumulative. No remedy herein conferred upon or reserved to
the Holder 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.
{28004717;4} 11
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01. Covenants of City, Etc.; Successors. All of the covenants, stipulations,
obligations and agreements contained in this Agreement shall be deemed to be covenants,
stipulations, obligations and agreements of the City to the full extent authorized or permitted by
law, and all such covenants, stipulations, obligations and agreements shall be binding upon the
successor or successors thereof from time to time, and upon any officer, board, council,
authority, agency or instrumentality to whom or to which any power or duty affecting such
covenants, stipulations, obligations and agreements shall be transferred by or in accordance with
law.
Section 6.02. Term of Agreement. This Agreement shall be in full force and effect
from the date hereof until the 2014 Note and all other sums payable to the Holder hereunder have
been paid in full.
Section 6.03. Amendments and Supplements. This Agreement may be amended or
supplemented from time to time only by a writing duly executed by each of the City and the
Holders.
Section 6.04. Notices. Any notice, demand, direction, request or other instrument
authorized or required by this Agreement to be given to or filed with the City or the Bank, shall
be deemed to have been sufficiently given or filed for all purposes of this Agreement if and
when sent by certified mail, return receipt requested:
(a) As to the City:
City of Cape Canaveral, Florida
P.O. Box 326
Cape Canaveral, Florida 32920
Attention: City Manager
(b) With a copy to:
Anthony Garganese, Esq.
111 N. Orange Avenue, Suite 200
Orlando, Florida 32801
(c) As to the Bank:
Hancock Bank
113 Designer Circle
Dothan, Alabama 36303
Attention: Steven E. Cole
or at such other address as shall be furnished in writing by any such party to the other, and shall
be deemed to have been given as of the date so delivered or deposited in the United States mail.
(28004717;4) 12
Either party may, by notice sent to the other, designate a different or additional address to which
notices under this Agreement are to be sent.
Section 6.05. Benefits Exclusive. Except as herein otherwise provided, nothing in this
Agreement, expressed or implied, is intended or shall be construed to confer upon any person,
firm or corporation, other than the City and the 2014 Holder, any right, remedy or claim, legal or
equitable, under or by reason of this Agreement or any provision hereof, this Agreement and all
of its provisions being intended to be and being for the sole and exclusive benefit of the City and
the 2014 Holder.
Section 6.06. Severability. In case any one or more of the provisions of this
Agreement, any amendment or supplement hereto or of the 2014 Note shall for any reason be
held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of
this Agreement, any amendment or supplement hereto or the 2014 Note, but this Agreement, any
amendment or supplement hereto and the 2014 Note shall be construed and enforced at the time
as if such illegal or invalid provisions had not been contained therein, nor shall such illegality or
invalidity or any application thereof affect any legal and valid application thereof from time to
time. In case any covenant, stipulation, obligation or agreement contained in the 2014 Note or in
this Agreement shall for any reason be held to be in violation of law, then such covenant,
stipulation, obligation, or agreement shall be deemed to be the covenant, stipulation, obligation
or agreement of the City to the full extent from time to time permitted by law.
Section 6.07. Payments Due on Saturdays, Sundays and Holidays. In any case where
the date of maturity of interest on or principal of the 2014 Note or the date fixed for prepayment
of the 2014 Note shall be other than a Business Day, then payment of such interest or principal
shall be made on the next succeeding Business Day with the same force and effect as if paid on
the date of maturity or the date fixed for prepayment, and no interest on any such principal
amount shall accrue for the period after such date of maturity or such date fixed for prepayment.
Section 6.08. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered, shall be an original; but such
counterparts shall together constitute but one and the same Agreement, and, in making proof of
this Agreement, it shall not be necessary to produce or account for more than one such
counterpart.
Section 6.09. Applicable Law. This Agreement shall be governed exclusively by and
construed in accordance with the applicable laws of the State of Florida.
Section 6.10. No Personal Liability. Notwithstanding anything to the contrary
contained herein or in the 2014 Note, or in any other instrument or document executed by or on
behalf of the City in connection herewith, no stipulation, covenant, agreement or obligation of
any present or future member of the City Council, officer, employee or agent of the City, officer,
employee or agent of a successor to the City, in any such person's individual capacity, shall
cause such person to be liable personally for any breach or non - observance of or for any failure
to perform, fulfill or comply with any such stipulations, covenants, agreements or obligations,
nor shall any recourse be had for the payment of the principal of or interest on the 2014 Note or
for any claim based thereon or on any such stipulation, covenant, agreement or obligation,
(28004717;4) 13
against any such person, in his or her individual capacity, either directly or through the City or
any successor to the City, under any rule or law or equity, statute or constitution or by the
enforcement of any assessment or penalty or otherwise and all such liability of any such person,
in his or her individual capacity, is hereby expressly waived and released.
Section 6.11. Incorporation by Reference. All of the terms and obligations of the
Resolution are hereby incorporated herein by reference as if all of the foregoing were fully set
forth in this Agreement. All recitals appearing at the beginning of this Agreement are hereby
incorporated herein by reference.
Section 6.12. Waiver of Jury Trial. THE BANK AND THE CITY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER
MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THE
RESOLUTION, THIS AGREEMENT, THE 2014 NOTE OR ANY OTHER AGREEMENT
CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL
OR WRITTEN), OR ACTIONS OF EITHER PARTY.
{28004717;4} 14
[Signature Page for LOAN AGREEMENT
dated as of February 26, 2014 between
the City of Cape Canaveral, FL and Hancock Bank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first set forth herein.
ATTEST:
City Clerk
{2800471714} 15
CITY OF CAPE CANAVERAL, FLORIDA
By.
Mayor Pro Tern
HANCOCK BANK
B -
Steven E. Cole
Title: Senior Vice President
EXHIBIT A
FORM OF NOTE
PRIOR TO BECOMING A HOLDER, A PROPOSED PURCHASER SHALL
EXECUTE A PURCHASER'S CERTIFICATE IN THE FORM ATTACHED HERETO
CERTIFYING, AMONG OTHER THINGS, THAT SUCH HOLDER IS AN "ACCREDITED
INVESTOR" AS SUCH TERM IS DEFINED IN THE SECURITIES ACT OF 1933, AS
AMENDED, AND REGULATION D THEREUNDER.
CITY OF CAPE CANAVERAL, FLORIDA
CAPITAL IMPROVEMENT REVENUE NOTE,
SERIES 2014
Principal Sum Maturity Date Note Rate Date of Issuance
$5,500,000 February 1, 2024 1.99% February 26, 2014
The CITY OF CAPE CANAVERAL, FLORIDA (the "City "), for value received, hereby
promises to pay, solely from the sources described in the within mentioned Agreement, to the
order of HANCOCK BANK, a Mississippi state banking corporation, or its assigns (the
"Holder "), the Principal Sum, such principal to be paid in installments on each February 1 in the
amounts set forth on Exhibit "A" hereto, with all unpaid principal and interest due in full on the
above referenced Maturity Date, and to pay interest on the outstanding principal amount hereof
from the most recent date to which interest has been paid or provided for, or if no interest has
been paid, from the Date of Issuance shown above, on February 1 and August 1 of each year
(each, a "Payment Date "), commencing on August 1, 2014, until payment of said principal sum
has been made or provided for, at the above referenced Note Rate calculated on the basis of 12,
30 -day months and a 360 -day year. Payments due hereunder shall be payable in any coin or
currency of the United States of America which, at the time of payment, is legal tender for the
payment of public and private debts, which payments shall be made to the Holder hereof by
check mailed to the Holder at the address designated in writing by the Holder for purposes of
payment or by bank wire or bank transfer as such Holder may specify in writing to the City or
otherwise as the City and the Holder may agree.
The 2014 Note Rate may be adjusted in accordance with Section 3.03 of that certain Loan
Agreement by and between the Holder and the City, dated as of February 26, 2014 (the
"Agreement'). Such adjustments may be retroactive.
This 2014 Note is issued for the purpose of providing the City funds to construct various
capital improvements including a city hall, a fire station and refurbishment of a wastewater
treatment plant under the authority of and in full compliance with the Constitution and Statutes
of the State of Florida, including particularly Chapter 166, Florida Statutes Ordinance No 03-
2014 of the City and other applicable provisions of law, and Resolution No. 2014 -05, adopted by
the City Council (the "Council ") on February 18, 2014, and the Agreement.
(2800471714) Exhibit A -1
This 2014 Note is a limited, special obligation of the City, payable from and secured
solely by a lien upon and pledge of the Pledged Revenues, as defined and described and in the
manner provided in the Agreement.
All capitalized terms not otherwise defined herein shall have the meanings ascribed to
such terms in the Agreement.
This 2014 Note may be prepaid by the City in whole, but not in part, on any date as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed without any prepayment penalty or fee, plus accrued
interest to the prepayment date. This 2014 Note may be prepaid in part on any February 1 as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed, without any prepayment penalty or fee plus accrued
interest to the prepayment date in Authorized Denominations. Any prepayments shall be applied
as provided in Section 3.02(c) of the Agreement.
Notice having been given as provided in the Agreement, the principal amount to be
prepaid shall become due and payable on the prepayment date stated in such notice, together
with interest accrued and unpaid to the prepayment date on such principal amount; and the
amount of principal and interest then due and payable shall be paid upon presentation and
surrender and exchange (if prepayment is part) of this 2014 Note to the office of the Registrar.
If, on the prepayment date, funds for the payment of the principal amount, together with interest
to the prepayment date on such principal amount, shall have been given to the Holder, as above
provided, then from and after the prepayment date interest on such principal amount of this 2014
Note shall cease to accrue.
Notwithstanding any provision in this 2014 Note to the contrary, in no event shall the
interest contracted for, charged or received in connection with this 2014 Note (including any
other costs or considerations that constitute interest under the laws of the State of Florida which
are contracted for, charged or received) exceed the maximum rate of nonusurious interest
allowed under the State of Florida as presently in effect and to the extent an increase is allowable
by such laws, but in no event shall any amount ever be paid or payable by the City greater than
the amount contracted for herein. In the event the maturity of this 2014 Note is prepaid in
accordance with the provisions hereof, the Agreement or the Resolution, then such amounts that
constitute payments of interest, together with any costs or considerations which constitute
interest under the laws of the State of Florida, may never exceed an amount which would result
in payment of interest at a rate in excess of that permitted by Section 215.84(3), Florida Statutes,
as presently in effect and to the extent an increase is allowable by such laws; and excess interest,
if any, shall be cancelled automatically as of the date of such prepayment, or, if theretofore paid,
shall be credited on the principal amount of this 2014 Note unpaid, but such crediting shall not
cure or waive any default under the Agreement or Resolution.
THIS 2014 NOTE SHALL NOT BE OR CONSTITUTE AN INDEBTEDNESS OF THE
CITY OR THE STATE OF FLORIDA (THE "STATE "), WITHIN THE MEANING OF ANY
CONSTITUTIONAL, STATUTORY OR CHARTER LIMITATIONS OF INDEBTEDNESS,
BUT SHALL BE PAYABLE SOLELY FROM THE PLEDGED REVENUES, AS PROVIDED
IN THE AGREEMENT AND THE RESOLUTION. THE HOLDER SHALL NEVER HAVE
{28004717;4) Exhibit A -2
THE RIGHT TO COMPEL THE EXERCISE OF THE AD VALOREM TAXING POWER OF
THE CITY, OR TAXATION IN ANY FORM OF ANY PROPERTY THEREIN TO PAY THIS
2014 NOTE OR THE INTEREST HEREON.
Upon the occurrence of an Event of Default the Holder of the 2014 Note shall also have
such remedies as described in the Agreement.
The City hereby waives presentment, demand, protest and notice of dishonor. This 2014
Note is governed and controlled by the Agreement and reference is hereby made thereto
regarding interest rate adjustments and other matters.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
{28004717;4} Exhibit A -3
IN WITNESS WHEREOF, the City has caused this 2014 Note to be signed by its Mayor
Pro Tern by his manual signature, and the seal of the City to be affixed hereto or imprinted or
reproduced hereon, and attested by a City Clerk of the City manually, and this 2014 Note to be
dated the Date of Issuance set forth above.
[SEAL]
ATTEST:
By:
City Clerk
CITY OF CAPE CANAVERAL, FLORIDA
Mayor Pro Tern
{28004717;4} Exhibit A -4
FORM OF CERTIFICATE OF AUTHENTICATION
Date of Authentication:
This 2014 Note is being delivered pursuant to the within mentioned Agreement.
CITY OF CAPE CANAVERAL, FLORIDA,
as Registrar
City Clerk
{28004717;4) Exhibit A -5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto
(please print or typewrite name, address
and tax identification number of assignee)
the within 2014 Note and all rights thereunder, and hereby irrevocably constitutes and appoints
Attorney to transfer the within 2014 Note on the books kept
for registration thereof, with full power of substitution in the premises.
Name of Holder:
UM
(28004717;4) Exhibit A -6
EXHIBIT A
NOTE - PRINCIPAL REPAYMENT SCHEDULE
Year Amount
2015
$509,000
2016
511,000
2017
521,000
2018
532,000
2019
543,000
2020
554,000
2021
565,000
2022
577,000
2023
588,000
2024
600,000
(28004717;4) Exhibit A -7
PURCHASER'S CERTIFICATE
City of Cape Canaveral, Florida (the "City ")
Ladies and Gentlemen:
The undersigned, as a purchaser of the City of Cape Canaveral, Florida Capital
Improvement Revenue Note, Series 2014 (the "2014 Note ") dated February 26, 2014, consisting
of one typewritten Note, hereby certifies that we have been provided (a) a copy of City
Ordinance No. 03 -2014 adopted on February 18, 2014 (b) a copy of City of Cape Canaveral
Resolution No. 2014 -05, adopted by the City on February 18, 2014, authorizing the issuance of
the 2014 Note (the "Resolution "), (c) the Loan Agreement dated as of February 26, 2014,
between the City and us as assignee of Hancock Bank (the "Agreement ") and (d) such financial
and general information respecting the Pledged Revenues (as such term is defined in the
Agreement) and the City, and the 2014 Note described above as we deem necessary to enable us
to make an informed investment judgment with respect to the purchase of said 2014 Note.
We hereby make the following representations, which representations may be relied upon
by the City:
A. We are aware:
(i) that investment in the 2014 Note involves various risks;
(ii) that the 2014 Note is not a general obligation of the City; and
(iii) that the principal or premium, if any, and interest on the 2014 Note is
payable solely from the Pledged Revenues as specified in the Resolution and the
Agreement.
B. We understand that no official statement, offering memorandum or other form of
offering document was prepared or is being used in connection with the offering
or sale of the 2014 Note (collectively, "Disclosure Documents "), but we have
been afforded access to all information we have requested in making our decision
to purchase the 2014 Note and have had sufficient opportunity to discuss the
business of the City with its officers, employees and others. We have not
requested any Disclosure Documents in connection with the sale of the 2014
Note. We do not require any further information or data incident to our purchase
of the 2014 Note.
C. In purchasing the 2014 Note, we have relied solely upon our own investigation,
examination, and evaluation of the City, the Pledged Revenues and other relevant
matters.
{28004717;4} Exhibit A -8
D. We have knowledge and experience in financial and business matters and are
capable of evaluating the merits and risks of our investment in the 2014 Note and
have determined that we can bear the economic risk of our investment in the 2014
Note.
E. We acknowledge the understanding that the 2014 Note is not registered under the
Securities Act of 1933, as amended (the "1933 Act ") or Chapter 517, Florida
Statutes, and that the Resolution and Agreement are not qualified under the Trust
Indenture Act of 1939, as amended, and that the City has no obligation to effect
any such registration or qualification.
F. We are not acting as a bond house, broker or other intermediary, in our purchase
of the 2014 Note. Although we retain the right to transfer the 2014 Note in the
future, we understand that the 2014 Note may not be readily tradable.
G. We have received all documents requested by us incident to our purchase of the
2014 Note.
H. We acknowledge that we are an "accredited investor" within the meaning of
Chapter 517, Florida Statutes and Regulation D of the 1933 Act.
Signed as of the day of
Authorized Officer
12800471 7;4) Exhibit A -9
No. 4
INCUMBENCY CERTIFICATE
The undersigned, Angela Apperson, the duly appointed, qualified and acting City Clerk
of the City of Cape Canaveral, Florida (the "City ") and the keeper of the records of the City,
HEREBY CERTIFIES that:
The following are now the duly appointed or elected, qualified and acting indicated
officers of the City:
2014.
Buzz Petsos, Mayor Pro Tern
Anthony Garganese, Esq., of
Brown, Garganese, Weiss & D'Agresta, P.A., City Attorney
David L. Greene, City Manager
IN WITNESS WHEREOF, I have hereunto set my hand as of this 26th day of February,
City Clerk, City of Cape Canaveral, Florida
I, Anthony Garganese, Esq. of Brown, Garganese, Weiss & D'Agresta, P.A., City
Attorney for the City of Cape Canaveral, Florida, do hereby certify that Angela Apperson is a
duly qualified City Clerk of the City of Cape Canaveral, Florida.
City Attorney for the City of Cape Canaveral,
Florida
(28116470;1 )
No. 5
$5,500,000 CITY OF CAPE CANAVERAL, FLORIDA
CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
FEDERAL TAX CERTIFICATE
I, David L. Greene, City Manager of the City of Cape Canaveral, Florida (the "Issuer" or
the "City ") HEREBY CERTIFY with respect to the Issuer's $5,500,000 Capital Improvement
Revenue Note, Series 2014 (the "Note ") which is being issued and delivered on the date of this
certificate, as follows:
1. The Note is being issued by the Issuer, a municipal corporation of the State of
Florida, under and pursuant to the Florida Constitution Chapter 166, Florida Statutes, Issuer
Ordinance No. 03 -2014 (the "Ordinance ") Issuer Resolution No. 2014 -05 (the "Resolution ") and
a Loan Agreement dated as of the date hereof between the Issuer and Hancock Bank (the
"Agreement "). Unless defined herein, capitalized terms have the meanings given them in the
Agreement.
2. I am one of the officers of the Issuer charged with the responsibility for issuing
the Note.
3. This certificate is made for the purpose of establishing the reasonable
expectations of the Issuer as to the amount, and use of the proceeds of the Note. It is intended
and may be relied upon for purposes of Sections 103 and 148 of the Internal Revenue Code of
1986, as amended (the "Code ") as a certification described in Section 1.148- 2(b)(2) of the
Treasury Regulations. This Federal Tax Certificate is being executed and delivered as part of the
record of proceedings in connection with the issuance of the Note.
4. This certificate sets forth the facts, estimates and circumstances now in existence
which are the basis for the Issuer's expectation that the proceeds of the Note will not be used in a
{28126038;2}
manner that would cause the Note to be arbitrage bonds under Section 148 of the Code or
otherwise cause the interest on the Note to become includable in gross income for federal income
tax purposes. The undersigned has investigated such facts, estimates and circumstances. To the
best of my knowledge and belief, the certifications set forth below are reasonable and there are
no further facts, estimates or circumstances that would materially change such certifications.
5. The Note is being issued for the purpose of providing funds, to finance some or
all of the construction of a city hall and a fire station and refurbishment of a city wastewater
treatment plant and related improvements (the "Project ") and to pay costs of issuing the Note.
No proceeds of the Note are being used to pay for costs incurred by the City more than 60 days
prior to the date. The Note is not secured by a reasonably required reserve or replacement fund.
The Project is intended to be available and will reasonably be available for use by the general
public. The City will not enter into any contracts or arrangements pursuant to which persons
who are not state or local governments have a right to use any component of the Project or have
a preferential right to use any component of the Project on a basis not available to members of
the general public.
6. On the basis of the facts, estimates and circumstances in existence on the date
hereof, I reasonably expect all of the proceeds of the Note will be applied to pay costs of the
Project and costs of issuing the Note as provided in the Agreement.
7. It is not expected that the Project will be sold or otherwise disposed of by the
Issuer prior to the final maturity of the Note, except such minor portions thereof as may be
disposed of due to normal wear, obsolescence or depreciation in the ordinary course of business.
{28126038;2} 2
8. The proceeds of the Note together with the available earning from the Note
proceeds do not exceed the amount necessary for the purposes for the Note as described in
paragraph 5 and 6 above.
9. The City has entered into, or within six (6) months of the date hereof will have
entered into, one or more binding contracts to third parties obligating aggregate expenditures of
at least 5% of the sale proceeds of the Note on the Project. The proceeds of the Note are
reasonably expected to be expended upon the Project, together with any investment earnings
thereon, within three years from the date hereof. It is expected that work toward completion of
the Project and the allocation of such proceeds and interest earnings to expenditures will proceed
with due diligence. Such proceeds (including investment earnings) to be expended on the
Project can be invested prior to the earlier of the date of such expenditure or February 25, 2017,
without restriction as to yield. After February 25, 2017 such proceeds will be invested in
obligations producing a yield not in excess of the yield on the Note plus one - eighth percent, or in
obligations producing a yield in excess of such yield provided the City makes "yield reduction
payments" as permitted by Treas. Reg. §1.148 -5(c), or in obligations the interest on which is
excluded from gross income for federal income tax purposes and which is not an item of "tax
preference" for purposes of the federal alternative minimum tax, unless bond counsel first
delivers an opinion that such proceeds can continue to be invested without regard to yield
restriction provided that investment earnings need not be so invested until one (1) year after the
date of receipt thereof.
10. The yield on the Note is determined under the rules set forth in Treas. Reg.
§1.148-4. The yield on the Note has been calculated by the use of semiannual compounding
(28126038;2) 3
using the thirty (30) days per month/360 days per year convention. The yield on the Note,
computed as of the Delivery Date, is at least 1.9901 %.
11. None of the proceeds of the Note will be used as a substitute for other funds
(i) which were otherwise to be used to construct the Project; (ii) which will not be so used; and
(iii) which have been or will be used, directly or indirectly, to acquire investment property
producing a yield in excess of the yield on the Note.
12. The Issuer does not presently expect to enter into any "hedging transaction" (i.e.,
transactions involving interest rate swaps, interest rate caps or collars or similar mechanisms to
shift the interest rate risk of payment) in respect of the Note.
13. No proceeds of the Note will be invested in investments having a yield to the
Issuer that is substantially guaranteed for four (4) years or more.
14. No obligations of the Issuer are being sold less than fifteen (15) days apart from
the date of sale of the Note, pursuant to the same plan of financing with the Note and which are
reasonably expected to be paid from substantially the same source of funds as the Note.
15. The weighted average maturity of the Note of 5.589465 years does not exceed
120% of the weighted average reasonably expected economic life of the Project computed as of
the later of the date hereof or the date the various components of the Project are expected to be
placed in service.
16. No portion of the proceeds of the Note will be invested, directly or indirectly, in
federally insured deposits or accounts other than for an initial temporary period until the
proceeds are needed for the Project amounts on deposit in a bona fide debt service fund.
17. The Issuer has covenanted in the Agreement that so long as the Note remains
outstanding it will comply with the requirements applicable to it to preserve the exclusion of
t28126038;2) 4
interest on the Note from gross income for federal income tax purposes. The Issuer has
covenanted in the Agreement and in Exhibit A hereto to comply with the provisions of Section
148(f) of the Code (the "Rebate Requirement ") and remit as required by Section 148(f) any
necessary amounts.
18. None of the proceeds of the Note will be used (directly or indirectly) to make or
finance loans from the Issuer to any persons.
19. The Issuer will not take any action which would cause the Note to be "private
activity bonds" within the meaning of Section 141 of the Code. The Issuer will not permit any
person other than a state or local governmental unit or as a member of the general public (a
"Nonexempt Person ") to use, through sale, lease, management contract, output contract or
similar agreement, any portions of the Project.
20. The Issuer acknowledges that in determining whether all or any portion of the
Project is used, directly or indirectly, in the trade or business of a Nonexempt Person for
purposes of Paragraph 19 above, use of any portion of the Project by a Nonexempt Person
pursuant to a lease, management contract, service contract, output contract or other arrangement
must be examined. The Issuer represents that all management and service contracts with persons
who are not employees of the Issuer for use of any portion of the Project will comply with the
guidelines set forth in IRS Revenue Procedure 97 -13 and any amendments thereto, unless the
Issuer receives an opinion from Bond Counsel that such contract will not adversely impact the
exclusion of interest on the Note from gross income for purposes of federal income taxation.
The Issuer agrees to maintain copies of all leases, management contracts, service contracts,
output contracts, and other preferential use arrangements with Nonexempt Persons with respect
{28126038;2} 5
to the use of any portion of the Project throughout the term of the Note and for a period of six
years thereafter.
21. No action that overburdens the tax - exempt market (within the meaning of Treas.
Reg. § 1.148- 10(a)) has been or is expected to be taken in connection with the Note. In
particular, no portion of the Note has been issued earlier, allowed to remain outstanding longer,
than is otherwise reasonably necessary to accomplish the governmental purposes of the Note.
Furthermore, each action taken or expected to be taken in connection with the Note would
reasonably be taken if the interest on the Note were not excluded from gross income for federal
income tax purposes (assuming that the hypothetical taxable interest rates would be the same as
the actual tax - exempt interest rates).
22. The City has neither received notice that its certificate may not be relied upon
with respect to its issues, nor has it been advised that any adverse action by the Commissioner of
the Internal Revenue Service is contemplated.
23. The City agrees to (a) impose such limitations on the investment or use of moneys
or investments related to the Note, (b) enter into such agreements, and (c) perform such other
acts as may be necessary under the Code to preserve the exclusion from gross income for
purposes of federal income taxation of interest on the Note, including complying with Exhibit B
hereto.
24. The City agrees to file all information statements as may be required by the Code.
25. None of the proceeds of the Note will be used (directly or indirectly) to acquire
any property which prior to its acquisition was used (or held for use) by a person other than a
state or local governmental unit in connection with an output facility. For purposes of this
{28126038;2} 6
Certificate, the term "output facility" means electric and gas generation, transmission, and
related facilities (but not water facilities).
26. No portion of the proceeds of the Note will be used to finance output facilities (as
that term is defined in Paragraph 25 above).
To the best of my knowledge and belief there are no facts, estimates or circumstances
other than those expressed herein that materially affect the expectations herein expressed, and, to
the best of my knowledge and belief, the Issuer's expectations are reasonable. I further represent
that the Issuer has had the opportunity to discuss the certifications set forth above with Bond
Counsel and the Issuer expects and intends to be able to comply with the provisions and
procedures set forth herein, including Section 148 of the Code.
128126038;2} 7
IN WITNESS WHEREOF, I have hereunto set my hand as of this 26`" day of February,
2014.
CITY OF CAPE CANAVERAL, FLORIDA
By: (r '7- J-1
City Manager
{28126038;2}
EXHIBIT A
February 26, 2014
City Council
City of Cape Canaveral, Florida
Re: $5,500,000 City of Cape Canaveral, Florida Capital Improvement Revenue Note, Series
2014
Ladies and Gentlemen:
This letter instructs you as to certain requirements of Section 148 of the Internal Revenue
Code of 1986, as amended (the "Code "), with respect to the above - referenced Note (the "Note ").
Capitalized terms used in this letter, not otherwise defined herein, shall have the same meanings
as set forth in the City's Federal Tax Certificate (the "Tax Certificate ") executed on the date
hereof.
This letter is intended to provide you with general guidance regarding compliance with
Section 148(f) of the Code. Because the requirements of the. Code are subject to amplification
and clarification, you should seek supplements to this letter from time to time to reflect any
additional or different requirements of the Code. In particular, you should be aware that
regulations implementing the rebate requirements of Section 148(f) (the "Regulations ") have
been issued by the United States Treasury Department. These regulations will, by necessity, be
subject to continuing interpretation and clarification through future rulings or other
announcements of the United States Treasury Department. You should seek further advice of
Bond Counsel as to the effect of any such future interpretations before the computation and
payment of any arbitrage rebate.
For the purposes of this Letter, (i) any instructions relating to a fund or account shall be
deemed to apply only to the portion of such fund or account allocable to the Note and (ii) any
reference to "the date hereof' shall be deemed to mean February 26, 2014.
SECTION 1. TAX COVENANTS. Pursuant to the Financing Agreement entered into
by the City in connection with the issuance of the Note, the City has made certain covenants
designed to assure that interest with respect to the Note is and shall remain excluded from gross
income for federal income tax purposes. The City has agreed, and by this Letter does hereby
covenant, that it will not directly or indirectly use or permit the use of any proceeds of the Note
or any other funds or take or omit to take any action that would cause the Note to be "arbitrage
bonds" within the meaning of Section 148 of the Code or that would otherwise cause interest on
the Note to be included in gross income for federal income tax purposes under the provisions of
the Code. You have further agreed by this letter to comply with all other requirements as shall be
determined by Bond Counsel (as hereinafter defined) to be necessary or appropriate to assure
that interest on the Note will be excluded from gross income for federal income tax purposes. To
that end, the City will comply with all requirements of Section 148 of the Code to the extent
applicable to the Note. In particular, the City agrees to cause the proceeds of the Note and any
{28126038;2} A- I
other Gross Proceeds as defined hereon to be invested in a manner that is consistent with the
expectations set forth in such Certificate. In the event that at any time the City is of the opinion
that for purposes of this Section 1 it is necessary to restrict or to limit the yield on the investment
of any moneys held by the City, the City shall take such action as may be necessary.
SECTION 2. DEFINITIONS. Unless the context otherwise requires, in addition to the
use of the terms defined in the Tax Certificate, the following capitalized terms have the
following meanings:
"Bond Counsel" shall mean Akerman LLP or other nationally recognized bond counsel.
"Bond Year" shall mean the one year period that ends at the close of business on the day
in the calendar year that is selected by the City. The first and last bond years may be short
periods. Unless otherwise selected, a Bond Year shall begin on each February 2 and end on the
succeeding February 1.
"Note Yield" shall mean that discount rate that, when used in computing the present
value on the Delivery Date of all unconditionally payable payments of principal, interest,
retirement price, and any Qualified Guarantee payments paid and to be paid on the Note,
produces an amount equal to the present value on the Delivery Date, using the same discount
rate, of the aggregate Issue Price of the Note. Yield is computed under the Economic Accrual
Method using any consistently applied compounding interval of not more than one year. Short
first and last compounding intervals may be used. Other reasonable, standard financial
conventions, such as the 30 days per month/360 days per year convention, may be used in
computing yield but must be consistently applied. The yield on the Note, computed in this
manner, is 1.9901%.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the applicable
Treasury Regulations promulgated thereunder.
"Computation Date" shall mean any date selected by the City as a computation date
pursuant to Section 1.148 -3(e) of the Regulations, and the Final Computation Date.
"Computation Credit Amount" means an amount, as of each Computation Credit Date,
equal to the amount allowed pursuant to Section 1.148- 3(d)(iv) of the Regulations.
"Computation Credit Date" means the last day of each Bond Year during which there are
amounts allocated to Gross Proceeds of the Note that are subject to the rebate requirement of
Section 148(f) of the Code, and the Final Computation Date.
"Delivery Date" shall mean February 26, 2014.
"Economic Accrual Method" shall mean the method of computing yield that is based on
the compounding of interest at the end of each compounding period (also known as the constant
interest method or the actuarial method).
"Final Computation Date" shall mean the date that the last bond that is part of the Note is
discharged.
{28126038;2} A -2
"Gross Proceeds" shall mean with respect to the Note, any proceeds of the Note and any
funds (other than the proceeds of the Note) that are a part of a reserve or replacement fund for
the issue, which amounts include amounts which are (A) actually or constructively received by
the City from the sale of the Note; (C) treated as Replacement Proceeds under Section 1.148 -1(c)
of the Regulations; (D) invested in a reasonably required reserve or replacement fund (as defined
in Section 1.148 -2(f) of the Regulations); (E) pledged by the City as security for payment of debt
service on the Note; (F) received with respect to obligations acquired with proceeds of the Note;
(G) used to pay debt service on the Note; and (H) otherwise received as a result of investing any
proceeds of the Note. The determination of whether an amount is included within this definition
shall be made without regard to whether the amount is credited to any fund or account
established under the Indenture or whether the amount is subject to the pledge of such
instrument.
"Guaranteed Investment Contract" means any Nonpurpose Investment that has
specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated
interest rate, and also includes any agreement to supply investments on two or more future dates
(e.g., a forward supply contract).
"Installment Payment Date" shall mean a Computation Date that is not later than 5 years
after the Delivery Date and subsequent Computation Dates which occur no later than 5 years
after the immediately preceding Installment Payment Date.
"Investment Property" shall mean any security or obligation, any annuity contract or
other investment -type property within the meaning of Section 148(b)(2) of the Code. The term
Investment Property shall not include any obligation the interest on which is excluded from gross
income (other than a Specified Private Activity Bond within the meaning of Section 57(a)(5)(C)
of the Code) and shall not include an obligation that is a one -day certificate of indebtedness
issued by the United States Treasury pursuant to the Demand Deposit State and Local
Government Series Program described in 31 CFR, part 344.
"Issue Price" shall mean, with respect to each bond comprising the Note, the issue price
based on the representations contained in a letter from the Underwriters of the Note included as
part of the closing transcript of the Note.
"Issue Yield" shall mean the Note Yield unless the Note are described in Section
1.148- 4(b)(3) or (4) of the Regulations, in which case, the Issue Yield shall be the Note Yield as
recomputed in accordance with such provisions of the Regulations.
" Nonpurpose Investment" shall mean any Investment Property in which Gross Proceeds
are invested, other than any Purpose Investment as defined in Section 1.148 -1(b) of the
Regulations. For purposes of this Letter, Investment Property acquired with revenues deposited
in the Revenue Account to be used to pay debt service on the Note within 13 months of the date
of deposit therein shall be disregarded.
" Nonpurpose Payment" shall, with respect to a Nonpurpose Investment allocated to the
Note, include the following: (1) the amount actually or constructively paid to acquire the
Nonpurpose Investment; (2) the Value of an investment not acquired with Gross Proceeds on the
{281260382} A -3
date such investment is allocated to the Note, and (3) any payment of Rebatable Arbitrage to the
United States Government not later than the date such amount was required to be paid. In
addition, the Computation Credit Amount shall be treated as a Nonpurpose Payment with respect
to the Note on each Computation Credit Date.
" Nonpurpose Receipt" shall mean any receipt or payment with respect to a Nonpurpose
Investment allocated to the Note. For this purpose the term "receipt" means any amount actually
or constructively received with respect to the investment. In the event a Nonpurpose Investment
ceases to be allocated to the Note other than by reason of a sale or retirement, such Nonpurpose
Investment shall be treated as if sold on the date of such cessation for its Value. In addition, the
Value of each Nonpurpose Investment at the close of business on each Computation Date shall
be taken into account as a Nonpurpose Receipt as of such date, and each refund of Rebatable
Arbitrage pursuant to Section 1.148 -3(i) of the Regulations shall be treated as a Nonpurpose
Receipt.
"Rebatable Arbitrage" shall mean as of any Computation Date the excess of the future
value of all Nonpurpose Receipts with respect to the Note over the future value of all
Nonpurpose Payments with respect to the Note. The future value of a Nonpurpose Payment or a
Nonpurpose Receipt as of any Computation Date is determined using the Economic Accrual
Method and equals the value of that payment or receipt when it is paid or received (or treated as
paid or received), plus interest assumed to be earned and compounded over the period at a rate
equal to the Issue Yield, using the same compounding interval and financial conventions used in
computing that yield.
"Retirement Price" shall mean, with respect to a bond, the amount paid in connection
with the retirement or redemption of the bond.
"Value" means value as determined under Section 1.148 -5(d) of the Regulations for
investments.
SECTION 3. REBATE REQUIREMENT.
(a) Unless one or more of the Spending Exceptions to Rebate described in
Appendix I to this letter are applicable to all or a portion of the Gross Proceeds of the
Note, City specifically covenants that it will pay or cause to be paid to the United States
Government the following amounts:
(1) No later than 60 days after each Installment Payment Date, an
amount which, when added to the future value of all previous rebate payments
made with respect to the Note, equals at least 90 percent of the Rebatable
Arbitrage calculated as of each such Installment Payment Date; and
(2) No later than 60 days after the Final Computation Date, an amount
which, when added to the future value of all previous rebate payments made with
respect to the Note, equals 100 percent of the Rebatable Arbitrage as of the Final
Computation Date.
{28126038;2} A -4
(b) Any payment of Rebatable Arbitrage made within the 60 -day period
described in Section 3(a)(1) and (2) above may be treated as paid on the Installment
Payment Date or Final computation date to which it relates.
(c) On or before 60 days following the Installment Payment Date or Final
Computation Date, pay the amount described in Section 3(a) of this Letter to the United
States Government at the Internal Revenue Service Center, Ogden, Utah 84201. Payment
shall be accompanied by Form 8038 -T. A rebate payment is paid on the date when it is
mailed to the Internal Revenue Service at the above location.
(d) The City shall keep proper books of record and accounts containing
complete and correct entries of all transactions relating to the receipt, investment,
disbursement, allocation and application of the money related to the Note, including
money derived from, pledged to, or to be used to make payments on the Note. Such
records shall specify the account or fund to which each investment (or portion thereof)
held by the City is to be allocated and shall set forth, in the case of each investment
security, (a) its purchase price; (b) nominal rate of interest; (c) the amount of accrued
interest purchased (included in the purchase price); (d) the par or face amount; (e)
maturity date; (f) the amount of original issue discount or premium (if any); (g) the type
of Investment Property; (h) the frequency of periodic payments; (i) the period of
compounding; 0) the yield to maturity; (k) date of disposition; (1) amount realized on
disposition (including accrued interest); and (m) market price data sufficient to establish
the fair market value of any Nonpurpose investment as of any Computation Date, and as
of the date such Nonpurpose Investment becomes allocable to, or ceases to be allocable
to, Gross Proceeds of the Note.
SECTION 4. PROHIBITED INVESTMENTS AND DISPOSITIONS.
(a) No Investment Property shall be acquired with Gross Proceeds for an
amount (including transaction costs) in excess of the fair market value of such Investment
Property. No Investment Property shall be sold or otherwise disposed of for an amount
(including transaction costs) less than the fair market value of the Investment Property.
(b) For purposes of subsection 4(a), the fair market value of any Investment
Property for which there is an established market shall be determined as provided in
subsection 4(c). Except as otherwise provided in subsections 4(e) and (f), any market
especially established to provide Investment Property to an issuer of governmental
obligations shall not be treated as an established market.
(c) The fair market value of any Investment Property for which there is an
established market is the price at which a willing buyer would purchase the investment
from a willing seller in a bona fide, arm's- length transaction. Fair market value is
generally determined on the date on which a contract to purchase or sell the Investment
Property becomes binding (i.e., the trade date rather than the settlement date). If a United
States Treasury obligation is acquired directly from or disposed of directly to the United
States Treasury, such acquisition or disposition shall be treated as establishing a market
for the obligation and as establishing the fair market value of the obligation.
(28126038;2) A -5
(d) Except to the extent provided in subsections (e) and (f), any Investment
Property for which there is not an established market shall be rebuttably presumed to be
acquired or disposed of for a price that is not equal to its fair market value.
(e) In the case of a certificate of deposit that has a fixed interest rate, a fixed
payment schedule, and a substantial penalty for early withdrawal, the purchase price of
such a certificate of deposit is treated as its fair market value on its purchase date if the
yield on the certificate of deposit is not less than (1) the yield on reasonably comparable
direct obligations of the United States; and (2) the highest yield that is published or
posted by the provider to be currently available from the provider on reasonably
comparable certificates of deposit offered to the public.
(f) The purchase price of a Guaranteed Investment Contract is treated as its
fair market value on the purchase date if the City complies with the competitive bidding
procedures and other requirements set forth in Section 1.148- 5(d)(6)(iii) of the
Regulations.
SECTION 5. ADMINISTRATIVE COSTS OF INVESTMENTS.
(a) Except as otherwise provided in this Section, an allocation of Gross
Proceeds of the Note to a payment or receipt on a Nonpurpose Investment is not adjusted
to take into account any costs or expenses paid, directly or indirectly, to purchase, carry,
sell or retire the Nonpurpose Investment (administrative costs). Thus, administrative costs
generally do not increase the payments for, or reduce the receipts from, Nonpurpose
Investments.
(b) In determining payments and receipts on Nonpurpose Investments,
Qualified Administrative Costs are taken into account by increasing payments for, or
reducing the receipts from, the Nonpurpose Investments. Qualified Administrative Costs
are reasonable, direct administrative costs, other than carrying costs, such as separately
stated brokerage or selling commissions, but not legal and accounting fees,
recordkeeping, custody, and similar costs. General overhead costs and similar indirect
costs of the City such as employee salaries and office expenses and costs associated with
computing Rebatable Arbitrage are not Qualified Administrative Costs
(c) Qualified Administrative Costs include all reasonable administrative costs,
without regard to the limitation on indirect costs stated in subsection (b) above, incurred
by:
(i) A publicly offered regulated investment company (as defined in
Section 67(c)(2)(B) of the Code); and
(ii) A commingled fund in which the City and any related parties do
not own more than 10 percent of the beneficial interest in the fund.
(d) For a Guaranteed Investment Contract, a broker's commission paid on
behalf of either the City or the provider is not a Qualified Administrative Cost to the
{28126038;2} A -6
extent that the commission exceeds the safe harbor amount specified in Section
1.148- 5(e)(2)(iii)(B) of the Regulations.
SECTION 6. RECORDS; BOND COUNSEL OPINION.
(a) The City shall retain all records with respect to the calculations and
instructions required by this Letter for at least 6 years after the date on which the last of
the principal of and interest on the Note has been paid, whether upon maturity,
redemption or acceleration thereof.
(b) Notwithstanding any provisions of this Letter, if the City shall be provided
an opinion of Bond Counsel that any specified action required under this Letter is no
longer required or that some further or different action is required to maintain or assure
the exclusion from federal gross income of interest with respect to the Note, the City may
conclusively rely on such opinion in complying with the requirements of this Letter.
SECTION 7. SURVIVAL OF DEFEASANCE. Notwithstanding anything in this
Letter to the contrary, the obligation of the City to remit the Rebate Requirement to the United
States Department of the Treasury and to comply with all other requirements contained in this
Letter must survive the defeasance or payment of the Note.
Very truly yours,
(�- � LCD
AKERMAN LLP
Received and acknowledged:
CITY OF CAPE CANAVERAL, FLORIDA
By: C9 "- --t
City Manager
(28126038;2) A -7
APPENDIX I
SPENDING EXCEPTIONS TO REBATE
(a) Generally. All, or certain discrete portions, of an issue are treated as meeting the
Rebate Requirement of Section 148(f) of the Code if one or more of the spending exceptions set
forth in this Appendix are satisfied. Use of the spending exceptions is not mandatory, except that
where an issuer elects to apply the 1 -1/2 percent penalty (as described below) the issuer must
apply that penalty to the Construction Issue. An issuer may apply the Rebate Requirement to an
issue that otherwise satisfies a spending exception. Special definitions relating to the spending
exceptions are contained in section (h) of this Appendix.
Where several obligations that otherwise constitute a single issue are used to finance two
or more separate governmental purposes, the issue constitutes a "multipurpose issue" and the
bonds, as well as their respective proceeds, allocated to each separate purpose may be treated as
separate issues for purposes of the spending exceptions. In allocating an issue among its several
separate governmental purposes, "common costs" are generally not treated as separate
governmental purposes and must be allocated ratably among the discrete separate purposes
unless some other allocation method more accurately reflects the extent to which any particular
separate discrete purpose enjoys the economic benefit (or bears the economic burden) of the
certain common costs (e.g., a newly funded reserve for a parity issue that is partially new money
and partially a refunding for savings on prior bonds).
Separate purposes include refunding a separate prior issue, financing a separate Purpose
Investment (e.g., a separate loan), financing a Construction Issue, and any clearly discrete
governmental purpose reasonably expected to be financed by the issue. In addition, as a general
rule, all integrated or functionally related capital projects qualifying for the same initial
temporary period (e.g., 3 years) are treated as having a single governmental purpose. Finally,
separate purposes may be combined and treated as a single purpose if the proceeds are eligible
for the same initial temporary period (e.g., advance refundings of several separate prior issues
could be combined, or several non - integrated and functionally unrelated capital projects such as
airport runway improvements and a water distribution system).
The spending exceptions described in this Appendix are applied separately to each
separate issue component of a multipurpose issue unless otherwise specifically noted.
(b) Six -Month Exception. An issue is treated as meeting the Rebate Requirement
under this exception if (i) the gross proceeds of the issue are allocated to expenditures for the
governmental purposes of the issue within the six -month period beginning on the issue date (the
"six -month spending period ") and (ii) the Rebate Requirement is met for amounts not required to
be spent within the six -month spending period (excluding earnings on a bona fide debt service
fund). For purposes of the six -month exception, "gross proceeds" means Gross Proceeds other
than amounts (i) in a bona fide debt service fund, (ii) in a reasonably required reserve or
replacement fund, (iii) that, as of the issue date, are not reasonably expected to be Gross
Proceeds but that become Gross Proceeds after the end of the six -month spending period,
(iv) that represent Sale Proceeds or Investment Proceeds derived from payments under any
t28126038;2) A -8
Purpose Investment of the issue and (v) that represent repayments of grants (as defined in
Treasury Regulation Section 1.148- 6(d)(4)) financed by the issue. In the case of an issue no bond
of which is a private activity bond (other than a qualified 501(c)(3) bond) or a tax or revenue
anticipation bond, the six -month spending period is extended for an additional six months for the
portion of the proceeds of the issue which are not expended within the six -month spending
period if such portion does not exceed the lesser of five percent of the Proceeds of the issue or
$100,000.
(c) 18 -Month Exception. An issue is treated as meeting the Rebate Requirement
under this exception if all of the following requirements are satisfied:
(i) the gross proceeds are allocated to expenditures for a governmental
purpose of the issue in accordance with the following schedule (the "18 -month
expenditure schedule ") measured from the issue date: (A) at least 15 percent
within six months, (B) at least 60 percent within 12 months and (C) 100 percent
within 18 months;
(ii) the Rebate Requirement is met for all amounts not required to be
spent in accordance with the 18 -month expenditure schedule (other than earnings
on a bona fide debt service fund); and
(iii) all of the gross proceeds of the issue qualify for the initial
temporary period under Treasury Regulation Section 1.148- 2(e)(2).
For purposes of the 18 -month exception, "gross proceeds" means Gross Proceeds other than
amounts (i) in a bona fide debt service fund, (ii) in a reasonably required reserve or replacement
fund, (iii) that, as of the issue date, are not reasonably expected to be Gross Proceeds but that
become Gross Proceeds after the end of the 18 -month expenditure schedule, (iv) that represent
Sale Proceeds or Investment Proceeds derived from payments under any Purpose Investment of
the issue and (v) that represent repayments of grants (as defined in Treasury Regulation Section
1.148- 6(d)(4)) financed by the issue. In addition, for purposes of determining compliance with
the first two spending periods, the investment proceeds included in gross proceeds are based on
the issuer's reasonable expectations as of the issue date rather than the actual Investment
Proceeds; for the third, final period, actual Investment Proceeds earned to date are used in place
of the reasonably expected earnings. An issue does not fail to satisfy the spending requirement
for the third spending period above as a result of a Reasonable Retainage if the Reasonable
Retainage is allocated to expenditures within 30 months of the issue date. The 18 -month
exception does not apply to an issue any portion of which is treated as meeting the Rebate
Requirement as a result of satisfying the two -year exception.
(d) Two -Year Exception. A Construction Issue is treated as meeting the Rebate
Requirement for Available Construction Proceeds under this exception if those proceeds are
allocated to expenditures for governmental purposes of the issue in accordance with the
following schedule (the "two -year expenditure schedule "), measured from the issue date:
(i) at least 10 percent within six months;
(ii) at least 45 percent within one year;
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(iii) at least 75 percent within 18 months; and
(iv) 100 percent within two years.
An issue does not fail to satisfy the spending requirement for the fourth spending period above as
a result of unspent amounts for Reasonable Retainage if those amounts are allocated to
expenditures within three years of the issue date.
(e) Expenditures for Governmental Purposes of the Issue. For purposes of the
spending exceptions, expenditures for the governmental purposes of an issue include payments
for interest, but not principal, on the issue and for principal or interest on another issue of
obligations. The preceding sentence does not apply for purposes of the 18 -month and two -year
exceptions if those payments cause the issue to be a refunding issue.
(f) De Minimis Rule. Any failure to satisfy the final spending requirement of the
18 -month exception or the two -year exception is disregarded if the issuer exercises due diligence
to complete the project financed and the amount of the failure does not exceed the lesser of three
percent of the issue price of the issue or $250,000.
(g) Elections Applicable to the Two -Year Exception. An issuer may make one or
more of the following elections with respect to the two -year spending exception:
(1) Earnings on Reasonably Required Reserve or Replacement Fund. An
issuer may elect on or before the issue date to exclude from Available Construction
Proceeds the earnings on any reasonably required reserve or replacement fund. If the
election is made, the Rebate Requirement applies to the excluded amounts from the issue
date.
(2) Actual Facts. For the provisions relating to the two -year exception that
apply based on the issuer's reasonable expectations, an issuer may elect on or before the
issue date to apply all of those provisions based on actual facts. This election does not
apply for purposes of determining whether an issue is a Construction Issue and if the
1-1/2 percent penalty election is made.
(3) Separate Issue. For purposes of the two -year exception, if any proceeds of
any issue are to be used for Construction Expenditures, the issuer may elect on or before
the issue date to treat the portion of the issue that is not a refunding issue as two, and only
two, separate issues, if (i) one of the separate issues is a Construction Issue, (ii) the issuer
reasonably expects, as of the issue date, that such Construction Issue will finance all of
the Construction Expenditures to be financed by the issue and (iii) the issuer makes an
election to apportion the issue in which it identifies the amount of the issue price of the
issue allocable to the Construction Issue.
(4) Penalty in Lieu of Rebate. An issuer of a Construction Issue may
irrevocably elect on or before the issue date to pay a penalty (the "1 -1/2 percent penalty ")
to the United States in lieu of the obligation to pay the rebate amount on Available
Construction Proceeds upon failure to satisfy the spending requirements of the two -year
expenditure schedule. The 1 -1/2 percent penalty is calculated separately for each
{28126038;2) A -10
spending period, including each semiannual period after the end of the fourth spending
period, and is equal to 1.5 percent times the underexpended proceeds as of the end of the
spending period. For each spending period, underexpended proceeds equal the amount of
Available Construction Proceeds required to be spent by the end of the spending period,
less the amount actually allocated to expenditures for the governmental purposes of the
issue by that date. The 1 -1/2 percent penalty must be paid to the United States no later
than 90 days after the end of the spending period to which it relates. The 1-1/2 percent
penalty continues to apply at the each of each spending period and each semiannual
period thereafter until the earliest of the following: (i) the termination of the penalty
under Treasury Regulation Section 1.148 -7(1), (ii) the expenditure of all of the Available
Construction Proceeds or (iii) the last stated final maturity date of bonds that are part of
the issue and any bonds that refund those bonds. If an issue meets the exception for
Reasonable Retainage except that all retainage is not spent within three years of the issue
date, the issuer must pay the 1-1/2 percent penalty to the United States for any
Reasonable Retainage that was not so spent as of the close of the three -year period and
each later spending period.
(h) Special Definitions Relating to Spending Expenditures.
(1) Available Construction Proceeds shall mean, with respect to an issue, the
amount equal to the sum of the issue price of the issue, earnings on such issue price,
earnings on amounts in any reasonably required reserve or replacement fund not funded
from the issue and earnings on all of the foregoing earnings, less the amount of such issue
price in any reasonably required reserve or replacement fund and less the issuance costs
financed by the issue. For purposes of this definition, earnings include earnings on any
tax - exempt bond. For the first three spending periods of the two -year expenditure
schedule described in Treasury Regulation Section 1.148 -7(e), Available Construction
Proceeds include the amount of future earnings that the issuer reasonably expected as of
the issue date. For the fourth spending period described in Treasury Regulation Section
1.148 -7(e), Available Construction Proceeds include the actual earnings received.
Earnings on any reasonably required reserve or replacement fund are Available
Construction Proceeds only to the extent that those earnings accrue before the earlier of
(i) the date construction is substantially completed or (ii) the date that is two years after
the issue date. For this purpose, construction may be treated as substantially completed
when the issuer abandons construction or when at least 90 percent of the total costs of the
construction that the issuer reasonably expects as of such date will be financed with
proceeds of the issue have been allocated to expenditures. If only a portion of the
construction is abandoned, the date of substantial completion is the date the
non - abandoned portion of the construction is substantially completed.
(2) Construction Expenditures shall mean capital expenditures (as defined in
Treasury Regulation Section 1.150 -1) that are allocable to the cost of Real Property or
Constructed Personal Property. Construction Expenditures do not include expenditures
for acquisitions of interest in land or other existing Real Property.
(3) Construction Issue shall mean any issue that is not a refunding issue if
(i) the issuer reasonably expects, as of the issue date, that at least 75 percent of the
(28126038;2) A -1 I
Available Construction Proceeds of the issue will be allocated to Construction
Expenditures for property owned by a governmental unit or a 501(c)(3) organization and
(ii) any private activity bonds that are part of the issue are qualified 501(c)(3) bonds or
private activity bonds issued to financed property to be owned by a governmental unit or
a 501(c)(3) organization.
(4) Constructed Personal Property shall mean Tangible Personal Property or
Specially Developed Computer Software if (i) a substantial portion of the property is
completed more than six months after the earlier of the date construction or rehabilitation
commenced and the date the issuer entered into an acquisition contract; (ii) based on the
reasonable expectations of the issuer, if any, or representations of the person constructing
the property, with the exercise of due diligence, completion of construction or
rehabilitation (and delivery to the issuer) could not have occurred within that six -month
period; and (iii) if the issuer itself builds or rehabilitates the property, not more than 75
percent of the capitalizable cost is attributable to property acquired by the issuer.
(5) Real Property shall mean land and improvements to land, such as
buildings or other inherently permanent structures, including interests in real property.
For example, Real Property includes wiring in a building, plumbing systems, central
heating or air - conditioning systems, pipes or ducts, elevators, escalators installed in a
building, paved parking areas, roads, wharves and docks, bridges, and sewage lines.
(6) Reasonable Retainage shall mean an amount, not to exceed five percent of
(i) Available Construction Proceeds as of the end of the two -year expenditure schedule
(in the case of the two -year exception to the Rebate Requirement) or (ii) Net Sale
Proceeds as of the end of the 18 -month expenditure schedule (in the case of the 18 -month
exception to the Rebate Requirement), that is retained for reasonable business purposes
relating to the property financed with the issue. For example, a Reasonable Retainage
may include a retention to ensure or promote compliance with a construction contract in
circumstances in which the retained amount is not yet payable, or in which the issuer
reasonably determines that a dispute exists regarding completion or payment.
(7) Specially Developed Computer Software shall mean any programs or
routines used to cause a computer to perform a desired task or set of tasks, and the
documentation required to describe and maintain those programs, provided that the
software is specially developed and is functionally related and subordinate to Real
Property or other Constructed Personal Property.
(8) Tangible Personal Property shall mean any tangible personal other than
Real Property, including interests in tangible personal property. For example, Tangible
Personal Property includes machinery that is not a structural component of a building,
subway cars, fire trucks, automobiles, office equipment, testing equipment, and
furnishings.
{28126038;2} A -12
(i) Special Rules Relating to Refundings.
(1) Transferred Proceeds. In the event that a prior issue that might otherwise
qualify for one of the spending exceptions is refunded, then for purposes of applying the
spending exceptions to the prior issue, proceeds of the prior issue that become transferred
proceeds of the refunding issue continue to be treated as unspent proceeds of the prior
issue; if such unspent proceeds satisfy the requirements of one of the spending exceptions
then they are not subject to rebate either as proceeds of the prior issue or of the refunding
issue. Generally, the only spending exception applicable to refunding issues is the
six -month exception. In applying the six -month exception to a refunding of a prior issue,
only transferred proceeds of the refunding issue from a taxable prior issue and other
amounts excluded from the definition of gross proceeds of the prior issue under the
special definition of gross proceeds contained in section (b) above are treated as gross
proceeds of the refunding issue and so are subject to the six -month exception applicable
to the refunding issue.
(2) Series of Refundings. In the event that an issuer undertakes a series of
refundings for a principal purpose of exploiting the difference between taxable and
tax - exempt interest rates, the six -month spending exception is measured for all issues in
the series commencing on the date the first bond of the series is issued.
0) Elections Applicable to Pool Bonds. An issuer of a pooled financing issue can
elect to apply the spending exceptions separately to each loan from the date such loan is made or,
if earlier, on the date one year after the date the pool bonds are issued. In the event this election
is made, no spending exceptions are available and the normal Rebate Requirement applies to
Gross Proceeds prior to the date on which the applicable spending periods begin. In the event
this election is made, the issuer may also elect to make all elections applicable to the two -year
spending exception, described in section (g) above, separately for each loan; any such elections
that must ordinarily be made prior to the issue date must then be made by the issuer before the
earlier of the date the loan is made or one year after the issue date.
128126038;2) A -13
EXHIBIT 611 "
POLICIES AND PROCEDURES FOR MONITORING
POST - ISSUANCE COMPLIANCE WITH THE REQUIREMENTS
OF THE INTERNAL REVENUE CODE
In connection with the issuance of tax - exempt obligations (including, without limitation,
bonds, notes, loans, leases and certificates) (together, "tax- exempt bonds ") that are subject to
certain requirements under the Internal Revenue Code of 1986, as amended (the "Code "), the
City of Cape Canaveral, Florida (the "City ") hereby adopts the following policies and procedures
which are intended to constitute written procedures for ongoing compliance with the Federal tax
requirements applicable to the tax - exempt bonds and for the timely identification and
remediation of violations of such requirements as follows.
1. In connection with the issuance of tax - exempt bonds, an authorized representative
of the City will sign a tax certificate prepared by Bond Counsel which sets forth (i) the City's
reasonable expectations as to the use of the proceeds of the tax - exempt bonds; and
(ii) instructions for post- issuance compliance with the federal tax laws relating to the tax - exempt
bonds.
2. The City Council of the City (the "Council ") shall identify persons responsible for
monitoring ongoing compliance with the tax requirements of the Code applicable to the
expenditure of proceeds of the tax - exempt bonds and the private use of bond - financed projects.
The Council or such other responsible persons, shall annually review compliance with these
procedures and the terms of the applicable tax certificates in order to determine whether any
violations have occurred so that such violations can be timely remediated through the "remedial
action" provisions of the United States Treasury Regulations or through the Voluntary Closing
Agreement Program administered by the Internal Revenue Service (the "IRS ").
3. The Council or such other responsible persons will work with Bond Counsel, a
financial advisor or underwriter, if applicable, to obtain a written certification as to the offering
price of bonds so as to establish the issue price of bonds for arbitrage purposes.
4. The Council or such other responsible persons will work with Bond Counsel to
ensure that the IRS Form 8038 -G is filed in a timely manner in connection with the issuance of
bonds.
5. The Council or other designated responsible persons will periodically check the
financial records and expenditures of the City to ensure that- (i) clear and consistent accounting
procedures are being used to track the investment and expenditure of bond proceeds, (ii) bond
proceeds are timely expended in accordance with the applicable temporary period rules of the
arbitrage regulations, and (iii) bond proceeds are expended in accordance with the expectations
contained in the tax certificate. The Council or such other responsible persons will ensure that a
final allocation of bond proceeds (including investment earnings) to qualifying expenditures is
made with respect to its tax - exempt bond proceeds.
6. The Council or other designated responsible persons will review arrangements for
the use of bond - financed facilities with non - governmental persons or organizations or the federal
{28126038;2} B -1
government (collectively referred to as "private persons ") in order to ensure that applicable
private activity bond limitations are not exceeded. Such review shall include the review of
contracts or arrangements with private persons with respect to bond - financed facilities which
could result in private business use of the facilities, including the sale of facilities, leases,
management or service contracts, research contracts or other contracts involving "special legal
entitlements" to bond - financed facilities. If it appears that applicable private activity bond
limitations are exceeded, the Board or such other responsible persons shall immediately contact
Bond Counsel,
7. The Council or other designated responsible persons shall comply with the
arbitrage rebate covenants contained in the tax certificate. The Council or other designated
responsible persons shall hire a rebate analyst or otherwise ensure that the rebate calculations are
conducted in a timely manner in order to determine compliance with arbitrage yield restrictions
and rebate requirements with respect to its bonds.
8. The Council or other designated responsible persons shall ensure that for each
issue of bonds, the transcript and all records and documents described in these procedures or in
the tax certificate will be maintained while any of the bonds are outstanding and during the three -
year period following the final maturity or redemption of that bond issue, or if the bonds are
refunded (or re- refunded), while any of the refunding bonds are outstanding and during the three -
year period following the final maturity or redemption of the refunding bonds.
9. The Council or other designated responsible persons will follow the
above - described procedures to comply with all tax - exempt bond requirements. If any violations
of the above or other applicable provisions of the federal tax laws relating to tax - exempt bonds
are discovered, the Council or other designated responsible persons shall immediately contact
Bond Counsel to determine the appropriate course of action to remedy such violation, including
contacting the IRS, if necessary.
{28126038;2} B -2
l► n1ril
CERTIFICATE AS TO SPECIMEN NOTE
The undersigned, duly appointed, qualified and acting City Clerk of the City of Cape
Canaveral, Florida, HEREBY CERTIFIES that attached hereto as an exhibit is a specimen of the
City of Cape Canaveral, Florida Capital Improvement Revenue Note, Series 2014 dated February
26, 2014 (the "Note "), in fully registered form, which specimen is identical in all respects, except
as to execution and authentication, to the Note this day delivered for the account of Hancock
Bank.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of
the City as of this 26th day of February, 2014.
[SEAL]
(28116651; 1)
CITY OF CAPE CANAVERAL, FLORIDA
C:�:�
City Clerk
PRIOR TO BECOMING A HOLDER, A PROPOSED PURCHASER SHALL
EXECUTE A PURCHASER'S CERTIFICATE IN THE FORM ATTACHED HERETO
CERTIFYING, AMONG OTHER THINGS, THAT SUCH HOLDER IS AN "ACCREDITED
INVESTOR" AS SUCH TERM IS DEFINED IN THE SECURITIES ACT OF 1933, AS
AMENDED, AND REGULATION D THEREUNDER.
CITY OF CAPE CANAVERAL, FLORIDA
CAPITAL IMPROVEMENT REVENUE NOTE,
SERIES 2014
Principal Sum Maturity Date Note Rate
been paid, from the Date of Is
(each, a "Payment Date "), coml
has been made or provided for,
30 -day months and a 360 -day
currency of the United
payment of public an
check mailed to the
payment or by b w
otherwise as i
wn ve, on ruary 1 and August 1 of each year
g on Augu 20 ,until payment of said principal sum
above referen ote Rate calculated on the basis of 12,
Payments uehereunder shall be payable in any coin or
ica whit , at the time of payment, is legal tender for the
yments shall be made to the Holder hereof by
Tress designated in writing by the Holder for purposes of
laer as such Holder may specify in writing to the City or
y agree.
'20 M a ate ma e adjusted in accordance with Section 3.03 of that certain Loan
y
the Holder and the City, dated as of February 26, 2014 (the
Such —ments may be retroactive.
is 2014 to is issued for the purpose of providing the City funds to construct various
capital im ove is including a city hall, a fire station and refurbishment of a wastewater
treatment pla nder the authority of and in full compliance with the Constitution and Statutes
of the State of Florida, including particularly Chapter 166, Florida Statutes Ordinance No 03-
2014 of the City and other applicable provisions of law, and Resolution No. 2014 -05, adopted by
the City Council (the "Council ") on February 18, 2014, and the Agreement.
This 2014 Note is a limited, special obligation of the City, payable from and secured
solely by a lien upon and pledge of the Pledged Revenues, as defined and described and in the
manner provided in the Agreement.
(28202368-,1)
All capitalized terms not otherwise defined herein shall have the meanings ascribed to
such terms in the Agreement.
This 2014 Note may be prepaid by the City in whole, but not in part, on any date as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed without any prepayment penalty or fee, plus accrued
interest to the prepayment date. This 2014 Note may be prepaid in part on any February I as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed, without any prepayment penalty or i e plus accrued
interest to the prepayment date in Authorized Denominations. Any prepayments all be applied
as provided in Section 3.02(c) of the Agreement.
TH OTE SHALL NOT BE OR CONSTITUTE AN INDEBTEDNESS OF THE
CITY OR T STATE OF FLORIDA (THE "STATE "), WITHIN THE MEANING OF ANY
CONSTITUTIONAL, STATUTORY OR CHARTER LIMITATIONS OF INDEBTEDNESS,
BUT SHALL BE PAYABLE SOLELY FROM THE PLEDGED REVENUES, AS PROVIDED
IN THE AGREEMENT. THE HOLDER SHALL NEVER HAVE THE RIGHT TO COMPEL
THE EXERCISE OF THE AD VALOREM TAXING POWER OF THE CITY, OR
TAXATION IN ANY FORM OF ANY PROPERTY THEREIN TO PAY THIS 2014 NOTE OR
THE INTEREST HEREON.
(28202368;1) 2
Upon the occurrence of an Event of Default the Holder of the 2014 Note shall also have
such remedies as described in the Agreement.
The City hereby waives presentment, demand, protest and notice of dishonor. This 2014
Note is governed and controlled by the Agreement and reference is hereby made thereto
regarding interest rate adjustments and other matters.
[REMAINDER OF PAGE INTENTIONALLY LEFT B
{28202368;1} 3
IN WITNESS WHEREOF, the City has caused this 2014 Note to be signed by its Mayor
Pro Tem by his manual signature, and the seal of the City to be affixed hereto or imprinted or
reproduced hereon, and attested by a City Clerk of the City manually, and this 2014 Note to be
dated the Date of Issuance set forth above.
[SEAL]
ATTFO.T-
By: _
C
CITY OF CAPE CANAVERAL, FLORIDA
Mayor Pro Tem
{28202368;1} 4
FORM OF CERTIFICATE OF AUTHENTICATION
Date of Authentication:
This 2014 Note is being delivered pursuant to the within mentioned Agreement.
CITY OF CAPE CANAVERAL, FLORIDA,
as Registrar
(28202368;1) 5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned sells, assigns and transfers unto
(please print or typewrite name, address
and tax identification number of assignee)
the within 2014 Note and all rights thereunder, and hereby irrevocably constitutes and appoints
Attorney to transfer the within 2014 Note on the books kept
for registration thereof, with full power of substitution in the premises.
Name of Holder:
C
(282 02368;1) 6
EXHIBIT A
NOTE - PRINCIPAL, REPAYMENT SCHEDULE
Year Amount
2015
2016
128202368; 11 7
$509,000
511,000
PURCHASER'S CERTIFICATE
City of Cape Canaveral, Florida (the "City ")
Ladies and Gentlemen:
The undersigned, as a purchaser of the City of Cape
Improvement Revenue Note, Series 2014 (the "2014 Note ") dated FE
of one typewritten Note, hereby certifies that we have been pry
Ordinance No. 03 -2014 adopted on February 18, 2014 (b) a co
Resolution No. 2014 -05, adopted by the City on February 18, 14,
the 2014 Note (the "Resolution "), (c) the Loan Agreem &
between the City and us as assignee of Hancock Bank (t "Agr
and general information respecting the Pledged Reve (as s
Agreement) and the City, and the 2014 Note described ab . we
to make an informed investment judgment with r s ect to t p
We hereby make the following
by the City:
We are aware:
Canaveral, IV& Capital
201
City
may be relied upon
involves various risks;
general obligation of the City; and
or premium, if any, and interest on the 2014 Note is
ledged Revenues as specified in the Resolution and the
WNment d that no official statement, offering memorandum or other form of
of was prepared or is being used in connection with the offering
e 2014 Note (collectively, "Disclosure Documents "), but we have
bee: afforded access to all information we have requested in making our decision
t chase the 2014 Note and have had sufficient opportunity to discuss the
usiness of the City with its officers, employees and others. We have not
requested any Disclosure Documents in connection with the sale of the 2014
Note. We do not require any further information or data incident to our purchase
of the 2014 Note.
C. In purchasing the 2014 Note, we have relied solely upon our own investigation,
examination, and evaluation of the City, the Pledged Revenues and other relevant
matters,
(28202368;1) 8
Sign(
D. We have knowledge and experience in financial and business matters and are
capable of evaluating the merits and risks of our investment in the 2014 Note and
have determined that we can bear the economic risk of our investment in the 2014
Note.
E. We acknowledge the understanding that the 2014 Note is not registered under the
Securities Act of 1933, as amended (the "1933 Act") or Chap er 517, Florida
Statutes, and that the Resolution and Agreement are not qualif under the Trust
Indenture Act of 1939, as amended, and that the City has no obli k ion to effect
any such registration or qualification.
F. We are not acting as a bond house, broker or other,
of the 2014 Note. Although we retain the right .
future, we understand that the 2014 Note may
G. We have received all documents req
2014 Note.
H. We acknowledge that we are
Chapter 517, Florida Statutey
us in ent to
Authorized Officer
{ 28202368;1) 9
2014 Note in the
purchase of the
el within the meaning of
933 Act.
CROSS RECEIPT
February 26, 2014
City Council of the
City of Cape Canaveral, Florida
Dear Councilmembers:
No. 7
We have deposited for your account the amount of $5,500,000 for payment of your
$5,500,000 Capital Improvement Revenue Note, Series 2014 dated February 26, 2014, received
today from you by the undersigned.
HANCOCK BANK
By:
Name: Steven E. Cole
Title: Senior Vice President
Please acknowledge receipt of
the foregoing deposit by signing
and returning a copy of this letter.
CITY OF CAPE CANAVERAL, FLORIDA
,9&.4 7 /
City Manager
{28116690;2}
No. 8
CLOSING CERTIFICATE OF THE CITY
The undersigned Mayor Pro Tem and City Manager of the City of Cape Canaveral,
Florida (the "City ") do hereby certify in connection with the issuance on the date hereof of the
City's Capital Improvement Revenue Note, Series 2014 (the "Note "), as follows:
1. There is no litigation of which we have notice, and to the best of our
knowledge, no litigation is pending or threatened (a) to restrain or enjoin the issuance or
delivery of the Note, (b) in any way contesting or affecting any authority for the issuance
of the Note or the validity of the Note, the Resolution, the Ordinance or the Agreement
(c) in any way contesting the existence or powers of the City or the City Council, (d) to
restrain or enjoin the ability of the City to perform under the Agreement or the Note, or
(e) which may result in any material adverse change in the business, property, assets, or
financial condition of the City or materially impair the ability of the City to perform its
obligations under the Agreement or the Note.
2. The seal, an impression of which appears below, is the official seal of the
City and is the only legally adopted, proper and official seal of the City.
3. The City has not been in default as to principal or interest on any debt
obligation issued or guaranteed by the City since December 31, 1975 to which City
revenues are pledged.
4. All representations of the City in the Agreement are true and correct as of
the date hereof.
5. The information provided to Akerman LLP, Bond Counsel to the City for
preparation of Internal Revenue Service Form 8038 -G is correct and Bond Counsel is
hereby requested to prepare and submit said Form 8038 -G.
6. Any written information, reports and other papers and data prepared by the
City and furnished to Hancock Bank (the "Purchaser ") in regard to the Note by the City
were, at the time the same were so furnished, complete and correct in all material respects
to the extent necessary to give the Purchaser a true and accurate knowledge of the subject
matter thereof. There is no fact, circumstance or condition that has not been disclosed to
the Purchaser in writing by the City which materially and adversely affects or, as far as
the City can now foresee, will materially and adversely affect, (i) the financial condition,
revenues, properties or operations of the City or (ii) the validity or enforceability of, or
the authority or ability of the City to perform its obligations under, the Agreement or the
Note.
7. The City is presently in compliance with all agreements and has satisfied
all conditions on its part to be observed or satisfied under the Agreement at or prior to the
date hereof.
(28116760;2)
8. Following the issuance of the Note, the City will have no debt or
obligations outstanding which have a lien on any of the Pledged Revenues other than the
Note.
Any terms not otherwise defined herein shall have the meanings ascribed thereto Loan
Agreement (the "Agreement ") dated as of the date hereof by and between the City and the
Purchaser.
IN WITNESS WHEREOF, we have hereunto set our hands as of this 26`h day of
February, 2014.
CITY OF CAPE CANAVERAL, FLORIDA
Mayor Pro Tem
City Manager
{28116760;2} 2
February 26, 2014
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
Department of Treasury
Internal Revenue Service Center
Ogden, UT 84201
Indra Rivas
Akerman LLP
420 South Orange Avenue
Suite 1200
Orlando, FL 32801 -4904
Tel: 407.423.4000
Fax: 407.843.6610
Certified Article Number
-0.: 9111 1079
SENDERS RECORD
Re: $5,500,000 CITY OF CAPE CANAVERAL, FLORIDA
CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
Ladies and Gentlemen:
On behalf of the City of Cape Canaveral, Florida, enclosed herewith for filing is Form
8038 -G and an Acknowledgement Copy of the same with respect to the above - referenced matter.
A self - addressed, stamped envelope has also been enclosed for your convenience in return of the
Acknowledgment Copy.
Sincerely,
U/* / �
Indra Rivas
Public Finance Coordinator
akerman.com
{28222796;1}
Form 8038 -G Information Return for Tax - Exempt Governmental Obligations
(Rev. September 2011) ► Under Internal Revenue Code section 149(e) OMB No. 1545 -0720
Do- See separate instructions.
Department of the Treasury
Internal Revenue Service Caution: If the issue price is under $100,000, use Form 8038 -GC.
WOrs" ReDortinq Authoritv If Amended Return. check here ► F]
1 Issuer's name
2 Issuer's employer identification number (EIN)
City of Cape Canaveral, Florida
59- 0974636
3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions)
3b Telephone number of other person shown on 3a
4 Number and street (or P.O. box if mail is not delivered to street address)
Room/suite
5 Report number (For IRS Use Only)
P.O. Box 326
5,500,000
3
6 City, town, or post office, state, and ZIP code
7 Date of issue
Cape Canaveral, Florida 32920
02 -26 -2014
8 Name of issue Capital Improvement Revenue Note, Series 2014
9 CUSIP number
00
None
10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see
10b Telephone number of officer or other
instructions)
employee shown on 10a
David L. Greene, City Manager
321- 868 -1230
1 :F.1iil■ Tvne of Issue (enter the issue Drlce). See the instructions and attach schedule.
11
12
13
14
15
16
17
18
Education . . . . . . . . . . . . . . . . . . . . . . . .
Health and hospital . . . . . . . . . . . . . . . . . . . .
Transportation . . . . . . . . . . . . . . . . . . . . . .
Public safety . . . .
Environment (including sewage bonds) . . . . . . . . . . . . . .
Housing . . . . . . . . . . . . . . . . . . . . . . . .
Utilities . . . . . . . . . . . . . . . . . . . . . . . .
Other. Describe ► Various Public improvements
. . . . . .
. . . . . .
. . . . . .
. . . . . .
. . . . . .
. . . . . .
11
Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . . .
Issue price of entire issue (enter amount from line 21, column (b)) . . . . .
Proceeds used for bond issuance costs (including underwriters' discount) . 24 55,000
Proceeds used for credit enhancement . . . . . . . . . . . . 25 0'
Proceeds allocated to reasonably required reserve or replacement fund 26 0
Proceeds used to currently refund prior issues . . . . . . . . . 27 0
Proceeds used to advance refund prior issues . . ,. . . . . . . 28 0
Total (add lines 24 through 26) . . . . . . . . . . . . . . . . . . . . . .
Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here)
12
22
13
14
5,500,000
15
16
00
17
18 5,500,000
00
19
20
If obligations are TANs or RANs, check only box 19a . . . . . . . . .
If obligations are BANS, check only box 19b . . . . . . . . . . . .
If obligations are in the form of a lease or installment sale, check box . . . .
. . . ► ❑''�
. . ► ❑
. . . . ► ❑
r"
Description of Refunded Bonds. Complete this part only for refunding bonds.
Description of Obligations. Complete for the entire issue for which this form is being filed.
31
32
33
34
Enter the remaining weighted average maturity of the bonds to be currently refunded . . . .
Enter the remaining weighted average maturity of the bonds to be advance refunded . . . .
Enter the last date on which the refunded bonds will be called (MM /DD/YYYY) . . . . . .
Enter the date(s) the refunded bonds were issued ► (MM /DD/YYYY)
(a) Final maturity date
(b) Issue price
(c) Stated redemption
price at maturity
(d) Weighted
average maturity
(e) Yield
21
02 -01 -2024
5,500,000
5,500,000
5.589465 years
1.9901 %
25498204_l .PDF
Uses of Proceeds of Bond Issue (including underwriters' discount)
22
23
24
25
26
27
28
29
30
Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . . .
Issue price of entire issue (enter amount from line 21, column (b)) . . . . .
Proceeds used for bond issuance costs (including underwriters' discount) . 24 55,000
Proceeds used for credit enhancement . . . . . . . . . . . . 25 0'
Proceeds allocated to reasonably required reserve or replacement fund 26 0
Proceeds used to currently refund prior issues . . . . . . . . . 27 0
Proceeds used to advance refund prior issues . . ,. . . . . . . 28 0
Total (add lines 24 through 26) . . . . . . . . . . . . . . . . . . . . . .
Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here)
.
00
.
22
0
23
5,500,000
00
55,000
00
29k
30
1 5,445,000
00
Description of Refunded Bonds. Complete this part only for refunding bonds.
N/A
31
32
33
34
Enter the remaining weighted average maturity of the bonds to be currently refunded . . . .
Enter the remaining weighted average maturity of the bonds to be advance refunded . . . .
Enter the last date on which the refunded bonds will be called (MM /DD/YYYY) . . . . . .
Enter the date(s) the refunded bonds were issued ► (MM /DD/YYYY)
► years
► years
►
For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773s
Form 8038 -G (Rev. 9 -2011)
25498204_l .PDF
Form 8038 -G (Rev. 9 -2011) Page 2
Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . . . . 35 0
36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract„
(GIC) (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . 36a 0
b Enter the final maturity date of the GIC ►
c Enter the name of the GIC provider►
37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans
to other governmental units . . . . . . . . . . . . . . . . . . . . . . . . 37 0
38a If this issue is a loan made from the proceeds of another tax- exempt issue, check box ► ❑ and enter the following information:
b
Enter the date of the master pool obligation ►
c
Enter the EIN of the issuer of the master pool obligation Po-
d
Enter the name of the issuer of the master pool obligation ►
39
If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box See * below
01- 0
40
If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . . .
► ❑
41a
If the issuer has identified a hedge, check here ► ❑ and enter the following information:
b
Name of hedge provider ►
c
Type of hedge Po-
d
Term of hedge ►
42
If the issuer has superintegrated the hedge, check box . . . . . . . . . . . . . . . . . . . . .
► ❑
43
If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated
according to the requirements under the Code and Regulations (see instructions), check box . . . . . . . .
► 0
44
If the issuer has established written procedures to monitor the requirements of section 148, check box . . . . .
► 0
45a
If some portion of the proceeds was used to reimburse expenditures, check here ► ❑ and enter the amount
of reimbursement . . . . . . . . . lo-
b
Enter the date the official intent was adopted Ili-
Signature
and
Consent
Paid
Preparer
Use Only
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge
and belief, they are true, correct, and complete. I further declare that I consent to the IRS's disclosure of the issuer's return information, as necessary to
process this return, to the person that I have authorized above.
'C,- 1 ,spy February 26, 2014
Signature of issuer's authorized representative Date
Print/Type preparer's name Pr is nature /
Michael D. Williams, Esq. (/
Firm's name P. Akerman LLP
Firm's address ► 420 S. Orange Avenue, Suite 1200, Orlando, FL 32801
25498204_1.PDF
David L. Greene, City Manager
FType or print name and title
Date Check ❑ if PTIN
02 -17 -2014 self - employed po(U /,3%7)- ! c� 3
Firm's EIN ► --7/1'7 d
Phone no. 407.423.4000
Form 8038-6 (Rev. 9 -2011)
Bond Finance - Local Bond Monitoring: Notice of Sale
Page 1 of 1
STATE OF FLORIDA - DIVISION OF BOND FINANCE LOCAL BOND MONITORING
Home Account Logout
Notice of Sale Status
Notice of Sale submission successful.
Submit Date: 12/6/2013
Bond Issue Name: CITY OF CAPE CANAVERAL, FLORIDA CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
Sale Date: 2/5/2014
Closing Date: 2/20/2014
Print this page
https : //bondissue.sbafla.com/nos.aspx 12/6/2013
Rivas, Indra (Orl)
From: Rivas, Indra (Orl)
Sent: Wednesday, February 26, 2014 12:00 PM
To: 'Williams Sharon'
Cc: Williams, Michael (Ptnr -Orl)
Subject: City of Cape Canaveral, Florida Capital Improvement Revenue Note Series 2014
Attachments: IRS Certified Letter - City of Cape Canaveral.PDF; Debt Service Schedule - City of Cape
Canaveral.PDF; Optional Redemption - City of Cape Canaveral.PDF; Maturity - City of
Cape Canaveral.PDF
Dear Sharon:
The Bond Information Form for the City of Cape Canaveral, Florida Capital Improvement Revenue Note Series 2014 was
filed online. Please find attached an executed copy of the 8038 -G with proof of filing with the IRS, the Debt Schedule,
Optional Redemption Provision and Maturity Date. Please note no offering document was done for this transaction.
Thank you,
Indra Rivas
Public Finance Coordinator
Akerman LLP 1 420 South Orange Avenue I Suite 1200 1 Orlando, FL 32801 -4904
Dir: 407.419.8577 1 Main: 407.423.4000 1 Fax: 407.843.6610
indra.rivas @akerman.corn
STATE OF FLORIDA
DIVISION OF BOND FINANCE
LOCAL BOND MONITORING SECTION
This form represents an update and compilation of the BF2003, BF2004 -A and BF2004 -B forms.
Bond Information forms (BF2003) are required to be completed by local governments pursuant to Chapter 19A- 1.003, Florida Administrative Code (F.A.
C.). ' Bond Disclosure forms BF2004 -A (Competitive Sale) or BF2004 -B (Negotiated Sale) are required to be filed with the Division within 120 days of the
delivery of the issue pursuant to Sections 218.38(1)(b)1 and 218.38(1)(c)1, Florida Statutes (F.S.), respectively.
" Final Official Statements, if prepared, are required to be submitted pursuant to Section 218.38(1), F.S..
Please complete all items applicable to the issuer as provided by the Florida Statutes.
PURSUANT TO SECTION 218.369, F.S., ISSUERS OF BOND ANTICIPATION NOTES ARE EXEMPT FROM THESE FILING REQUIREMENTS.
BF2003
BOND INFORMATION FORM
PART L ISSUER INFORMATION
1. NAME OF GOVERNMENTAL UNIT: City of Cape Canaveral, Florida
2. MAILING ADDRESS OF GOVERNMENTAL UNIT OR ITS MANAGER:
P.O. Box 326,Cape Canaveral, Florida 32920
3. COUNTY(IES) IN WHICH GOVERNMENTAL UNIT HAS JURISDICTION: Brevard
4. TYPE OF ISSUER: COUNTY ✓ CITY AUTHORITY INDEPENDENT SPECIAL DISTRICT
DEPENDENT SPECIAL DISTRICT OTHER (SPECIFY)
PART /I. BOND ISSUE INFORMATION
1 • NAME OF BOND ISSUE: Capital Improvement Revenue Note Series 2014
2. AMOUNT ISSUED: $ 5,500,000 3. AMOUNT AUTHORIZED: $ 5,500,000
4. DATED DATE: 02 -26 -2014 5. SALE DATE: 02 -18 -2014 6. DELIVERY DATE: 02 -26 -2014
7. LEGAL AUTHORITY FOR ISSUANCE: FLORIDA STATUTES Chapter 166,
SPECIAL ACTS
OTHER Issue Ordinance No. 03 -2014
8. TYPE OF ISSUE: _ GENERAL OBLIGATION _SPECIAL ASSESSMENT _ SPECIAL OBLIGATION
_ REVENUE COP (CERTIFICATE OF PARTICIPATION)_ LEASE- PURCHASE
✓ BANK LOAN /LINE OF CREDIT
9. A. IS THIS A PRIVATE ACTIVITY BOND (PAB)? YES ✓ NO
B. (1) IF YES, DID THIS ISSUE RECEIVE A PAB ALLOCATION? YES NO
(2) IF YES, AMOUNT OF ALLOCATION: $
10. SPECIFIC REVENUE(S) PLEDGED:
(1) PRIMARY Communication Services Tax, Public Service Tax, Guaranteed Entitlement, Half -Cent Sales Tax,
(2) SECONDARY Franchise Fees
(3) OTHER(S)
27006246_1.PDF
11A. PURPOSE(S) OF THE ISSUE:
(1) PRIMARY To construct a City Hall and other Capital Improvements
(2) SECONDARY
(3) OTHER(S)
B. IF PURPOSE IS REFUNDING, COMPLETE THE FOLLOWING:
(1) FOR EACH ISSUE REFUNDED LIST: NAME OF ISSUE, DATED DATE, ORIGINAL PAR VALUE (PRINCIPAL
AMOUNT) OF ISSUE, AND AMOUNT OF PAR VALUE (PRINCIPAL AMOUNT) REFUNDED.
(2) REFUNDED DEBT HAS BEEN: RETIRED OR DEFEASED
(3) A. DID THE REFUNDING ISSUE CONTAIN NEW MONEY? YES NO
B. IF YES, APPROXIMATELY WHAT PERCENTAGE OF PROCEEDS IS NEW MONEY? %
12. TYPE OF SALE: COMPETITIVE BID NEGOTIATED ✓ NEGOTIATED PRIVATE PLACEMENT
13. BASIS OF INTEREST RATE CALCULATION, I.E., INTEREST RATE USED TO STRUCTURE THE BOND ISSUE:
NET INTEREST COST RATE (NIC) % TRUE INTEREST COST RATE (TIC) %
CANADIAN INTEREST COST RATE (CIC) % ARBITRAGE YIELD (ARBI) 1.9901 %
SPECIFY OTHER:
For Portion of 2023 Maturity and 2025 through 2031 and 2039 Maturities
14. INSURANCE /ENHANCEMENTS: AGIC AMBAC CGIC CLIC FGIC FSA
HUD MBIA NGM LOC(LETTER OF CREDIT) OTHER (SPECIFY)
NOT INSURED
15. RATING(S): _MOODY'S _S & P FITCH _DUFF &PHELPS _ OTHER (SPECIFY)
✓ NOT RATED
16. DEBT SERVICE SCHEDULE: ATTACH COMPLETE COPY OF SCHEDULE PROVIDING THE FOLLOWING
INFORMATION:
MATURITY DATES (MO /DAY/YR)
COUPON /INTEREST RATES
ANNUAL INTEREST PAYMENTS
PRINCIPAL (PAR VALUE) PAYMENTS
MANDATORY TERM AMORTIZATION
SEE ATTACHED.
27006246_l .PDF 2
Principal Sum Maturity Date Note Rate Date of Issuance
$5,500,000 February 1, 2024 1.99% February 26, 2014
City of Cape Canaveral
Capital Improvement Revenue Note, series 2014
sank Financing option - Hancock Bank 10 Year Rate after Adjustment
Debt service schedule
Date Principal Coupon Interest Period Total Fiscal Total
-- -- - - -- - --- -- --- --- -- - --- - --- -- -------- - - - - -- ------- -- -- --- -------- -- ----
8/ 1/14 47,124.31 47,124.31
21 1/15 509,000.00 1.990000 54,725.00 563,725.00 610,849.31
8/ 1 /15 49,660.45 49,660.45
2/ 1/16 511,000.00 1.990000 49,660.45 560,660.45 610,320.90
8/ 1/16 44,576.00 44,576.00
21 1117 521,000.00 1.990000 44,576.00 565,576.00 610,152.00
8/ 1/17 39,392.05 39,392.05
21 1 /18 532,000.00 1.990000 39,392.05 571,392.05 610,784.10
8/ 1/18 34,098.65 34,098.65
2/ 1/19 543,000.00 1.990000 34,098.65 577,098.65 611,197.30
8/ 1/19 28,695.80 28,695.80
21 1/20 554,000.00 1.990000 28,695.80 582,695.80 611,391.60
8/ 1/20 23,183.50 23,183.50
21 1/21 565,000.00 11990000 23,183.50 588,183.50 611,367.00
8/ 1/21 17,561.75 17,561.75
2/ 1122 577,000.00 1.990000 17,561.75 594,56135 612,123.50
8/ 1122 11,820.60 11,820.60
2/ 1/23 588,000.00 1.990000 11,820.60 599,820.60 611,641.20
8/ 1/23 5,970.00 5,970.00
2/ 1/24 600,000.00 1.990000 5,970.00 605,970.00 611,940.00
-------- - -- - -- -------- - - - - -- -------- - - - - --
S,500,000.00 611,766.91 6,111,766,91
ACCRUED
51500,000.00 611,766.91 6,111,766.91
Dated 2/26/14 with Delivery of 2/26/14
Bond Years 30,742.056
Average Coupon 1.990000
Average Life 5.589465
N I C % 1.990000 % Using 100.0000000
T I C % 2.184080 % From Delivery Date
Arbitrage Yield 1.990113 %
Prepared by Larson consulting servicgs, Orlando, Florida
Micro -Muni Sizing Date: 01 -25 -2014 @ 11:16:21 Filename: BANK Key: HANCOCK10
17. LIST OR ATTACH OPTIONAL REDEMPTION PROVISIONS: In whole on any day at par and in part on any
February 1 at par
18. PROVIDE THE NAME AND ADDRESS OF THE SENIOR MANAGING UNDERWRITER OR SOLE PURCHASER.
Hancock Bank
113 Designer Circle
Dothan, Alabama 36303
19. PROVIDE THE NAME(S) AND ADDRESS(ES) OF ANY ATTORNEY OR FINANCIAL CONSULTANT WHO
ADVISED
THE UNIT OF LOCAL GOVERNMENT WITH RESPECT TO THE BOND ISSUE.
NO BOND COUNSEL NO FINANCIAL ADVISOR NO OTHER PROFESSIONALS
BOND COUNSEL(S):
Akerman LLP
420 S. Orange Avenue, Suite 1200
Orlando, FL 32801
FINANCIAL ADVISOR(S) /CONSULTANT(S):
Larson Consulting Services, LLC.
10151 University Blvd., #117
Orlando, FL 32817
OTHER PROFESSIONALS:
Brown, Garganese, Weiss & D'Agresta, P.A., Issuer Counsel
20. PAYING AGENT Issuer NO PAYING AGENT
21. REGISTRAR Issuer
22. COMMENTS:
NO REGISTRAR
PART Ill. RESPONDENT INFORMATION
FOR ADDITIONAL INFORMATION, THE DIVISION SHOULD CONTACT:
Name and Title Michael D. Williams, Esq. Phone 407.423.4000
Company Akerman LLP
INFORMATION RELATING TO PARTY COMPLETING THIS FORM (If different from above):
Name and Title Phone
Company
Date Report Submitted
27006246_l .PDF 3
Optional Redemption
This 2014 Note may be prepaid by the City in whole, but not in pant, on any date as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed without any prepayment penalty or fee, plus accrued
interest to the prepayment date. This 2014 Note may be prepaid in part on any February l as
provided in the Agreement from any legally available monies at a prepayment price of 100% of
the principal amount to be redeemed, without any prepayment penalty or fee plus accrued
interest to the prepayment date in Authorized Denominations. Any prepayments shall be applied
as provided in Section 3.02 {c} of the Agreement.
BF2004 -A and BF2004 -B
NOTE: The following items are required to be completed in full for all bond issues except those sold pursuant to Section
154 Part III, Sections 159 Parts II, III or V; or Section 243 Part II, Florida Statutes.
23. ANY FEE, BONUS, OR GRATUITY PAID BY ANY UNDERWRITER OR FINANCIAL CONSULTANT, IN
CONNECTION WITH THE BOND ISSUE, TO ANY PERSON NOT REGULARLY EMPLOYED OR ENGAGED BY
SUCH UNDERWRITER OR CONSULTANT:
✓ NO FEE, BONUS OR GRATUITY PAID BY UNDERWRITER OR FINANCIAL CONSULTANT
(1) COMPANY NAME
FEE PAID: $
(2) COMPANY NAME
FEE PAID: $
(3) COMPANY NAME
FEE PAID: $
(4) COMPANY NAME
FEE PAID: $
SERVICE PROVIDED or FUNCTION SERVED:
SERVICE PROVIDED or FUNCTION SERVED:
SERVICE PROVIDED or FUNCTION SERVED:
SERVICE PROVIDED or FUNCTION SERVED:
24• ANY OTHER FEES PAID BY THE UNIT OF LOCAL GOVERNMENT WITH RESPECT TO THE BOND ISSUE,
INCLUDING ANY FEE PAID TO ATTORNEYS OR FINANCIAL CONSULTANTS:
NO FEES PAID BY ISSUER
(1) COMPANY NAME Akerman LLP
FEE PAID: $ 13,000 SERVICE PROVIDED or FUNCTION SERVED: Bond Counsel
(2) COMPANY NAME Larson Consulting Services, LLC
FEE PAID: $ $13,000 SERVICE PROVIDED or FUNCTION SERVED: Financial Advisor
(3) COMPANY NAME Brown, Garganese, Weiss & D'Agresta, P.A.
FEE PAID: $ 10,000 SERVICE PROVIDED or FUNCTION SERVED: Issuer Counsel
(4) COMPANY NAME Bryant Miller Olive, P.A.
FEE PAID: $ 4,500 SERVICE PROVIDED or FUNCTION SERVED: Purchaser's Counsel
(UNLESS YOU ARE EXEMPT FROM FILING A BF2004), PLEASE PROVIDE THE SIGNATURE OF EITHER THE CHIEF
EXECUTIVE OFFICER OF THE GOVERNING BODY OF THE UNIT OF LOCAL GOVERNMENT OR THE
GOVERNMENTAL
OFFICER PRIMARILY RESPONSIBLE FOR COORDINATING THE ISSUANCE OF THE BONDS:
NAME (Typed /Printed): David L. Greene SIGNATURE: itrck,,4IL
TITLE: City Manager DATE: February 26, 2014
27006246_1.PDF 4
ITEMS 25 AND 26 MUST BE COMPLETED FOR ALL BONDS SOLD BY NEGOTIATED SALE
25. MANAGEMENT FEE CHARGED BY UNDERWRITER: $ 0 PER THOUSAND PAR VALUE.
OR
PRIVATE PLACEMENT FEE: $
x NO MANAGEMENT FEE OR PRIVATE PLACEMENT FEE
26. UNDERWRITER'S EXPECTED GROSS SPREAD: $ PER THOUSAND PAR VALUE.
NO GROSS SPREAD
PART IV. CONTINUING DISCLOSURE INFORMATION
In order to better serve local governments, the Division of Bond Finance will remind issuers as their deadlines
approach for filing continuing disclosure information required by SEC Rule 15c2 -12, based on the following information:
27. Is the issuer required to provide continuing disclosure information in accordance with SEC Rule 15c2 -12?
Yes
✓ No
28. If yes, on what date is the continuing disclosure information required to be filed?
29. Provide the following information regarding the person(s) responsible for filing continuing disclosure information
required
by SEC Rule 15c2 -12 and the continuing disclosure agreement (including other obligated parties, if appropriate).
Name: _
Title: _
Mailing Address:
Telephone Number:
FAX Number: _
E -mail address (if e-mail notification is requested):
PART V. RETURN THIS FORM AND THE FINAL OFFICIAL STATEMENT, IF ONE WAS PREPARED,
Courier Deliveries: Division of Bond Finance
State Board of Administration
1801 Hermitage Blvd., Suite 200
Tallahassee. FL 32308
Phone: 850/413 -1304 or 413 -1305
FAX: 850/413 -1315
27006246_1.PDF 5
Mailing Address: Division of Bond Finance
State Board of Administration
P. O. Drawer 13300
Tallahassee, FL 32317 -3300
REVISED Dec. 9, 2002 / bfcombo
No. 12
ACCEPTANCE OF DUTIES OF REGISTRAR
AND PAYING AGENT
The undersigned City Clerk of the City of Cape Canaveral, Florida (the "City "), hereby
accepts on behalf of the City the duties of the registrar and paying agent, in connection with the
City's Capital Improvement Revenue Note, Series 2014 dated the date hereof.
Dated: February 26, 2014
CITY OF CAPE CANAVERAL, FLORIDA
XA
City Clerk
{28117302;1}
No. 13
SIGNATURE CERTIFICATE
We, the undersigned, DO HEREBY CERTIFY as follows:
1. That the undersigned Mayor Pro Tem and City Clerk heretofore cause to be
officially executed the City of Cape Canaveral, Florida Capital Improvement Revenue Note,
Series 2014 (the "Note ").
2. That Buzz Petsos, Mayor Pro Tem of the City of Cape Canaveral, Florida (the
"City "), has executed the Note by his manual signature, a correct specimen of which is set out
below, and that said Mayor Pro Tem was on the date he executed the Note and is now the duly
elected, qualified and acting Mayor Pro Tem.
3. That we have caused the official seal of the City to be impressed on the Note, said
seal impressed hereon being the official seal of the City, and that Angela Apperson, the City
Clerk, has caused such seal to be attested by her manual signature, a correct specimen of which
is set out below, and that said Angela Apperson was on the date she signed the Note and is now
the duly qualified and acting City Clerk.
4. That the seal which has been impressed on or otherwise reproduced on the Note
and upon this certificate is the legally adopted, proper and only seal of the City.
5. That David L. Greene is the City Manager and a correct specimen of his signature
is set out below.
6. That Anthony Garganese of Brown, Garganese, Weiss & D'Agresta, P.A., is the
City Attorney and a correct specimen of his signature is set out below.
{28117524;1}
IN WITNESS WHEREOF, we have hereunto set our hands and affixed the official seal
of the City as of this 26`h day of February, 2014.
[SEAL]
Signature
{28117524;1}
Title of Office
Mayor Pro Tern
City Clerk
City Manager
City Attorney
February 26, 2014
City Council
City of Cape Canaveral
Cape Canaveral, Florida
Hancock Bank
113 Designer Circle
Dothan, Alabama 36303
Akerman LLP
420 South Orange Avenue
Suite 1200
Orlando, Florida 32801
Tel: 407.423.4000
Fax: 407.843.6610
CITY OF CAPE CANAVERAL, FLORIDA
$5,500,000 CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
(the "Note ")
Dear Ladies and Gentlemen:
We have acted as Bond Counsel in connection with the issuance by the City of Cape
Canaveral, Florida (the "Issuer ") of the referenced Note pursuant to the Constitution and laws of
the State of Florida, including particularly Chapter 166, Florida Statutes, Ordinance No. 03 -2014
of the Issuer and other applicable provisions of law (collectively, the "Act "), and Issuer
Resolution No. 2014 -05 adopted by the City Council of the Issuer on February 18, 2014 and a
Loan Agreement dated as of February 26, 2014 by and between the Issuer and Hancock Bank
(the "Agreement "). Any capitalized undefined term used herein shall have the same meaning as
such term has under the Agreement.
As to questions of fact material to our opinion, we have relied upon representations of the
Issuer contained in the Ordinance, the Resolution and the Agreement and in the certified
proceedings and other certifications of public officials furnished to us, without undertaking to
verify the same by independent investigation.
Reference is made to the opinion of even date herewith of Brown, Garganese, Weiss &
D'Agresta, P.A., Counsel to the Issuer, on which we have solely relied, as to the due creation and
valid existence of the Issuer, the due adoption by the Issuer of the Ordinance and the Resolution,
the due execution and delivery by the Issuer of the Note and the Agreement and compliance by
the Issuer with all conditions precedent to the issuance of the Note contained in the ordinances or
resolutions of the Issuer.
In addition to the foregoing, we have examined and relied upon such other resolutions,
certificates, documents, representations and opinions submitted to us, including certifications and
representations of public officials and other officers and representatives of the various parties
participating in this transaction, as we have deemed relevant and necessary in connection with
akerman.com
(28117612;1)
City of Cape Canaveral, Florida
Hancock Bank
February 26, 2014
Page 2
the opinions expressed below. We have not undertaken an independent audit, examination,
investigation or inspection of the matters described or contained in such resolutions, certificates,
documents, representations and opinions submitted to us and have relied solely on the facts,
estimates and circumstances described and set forth therein.
In our examination of the foregoing, we have assumed the genuineness of the signatures
on all documents and instruments, the authenticity of documents submitted as originals, the
conformity to originals of documents submitted as copies and the legal capacity of all natural
persons.
The scope of our engagement in relation to the issuance of the Note has been limited
solely to the examination of facts and laws incident to rendering the opinions expressed herein.
This opinion should not be construed as offering material or an offering circular,
prospectus or official statement and is not intended in any way to be a disclosure statement used
in connection with the sale or delivery of the Note. In addition, we have not been engaged to
and, therefore, do not express any opinion as to compliance by the Issuer with any federal or
state statute, regulation or ruling with respect to the sale and distribution of the Note.
Neither the Note nor the interest and premium, if any, payable thereon shall constitute a
general obligation or general indebtedness of the Issuer within the meaning of the Constitution
and laws of the State of Florida. The Note and the interest and premium, if any, payable thereon
do not constitute either a pledge of the full faith and credit of the Issuer or a lien upon any
property of the Issuer other than as provided in the Agreement, the Resolution and the
Ordinance. No owner of the Note or any other person shall ever have the right, directly or
indirectly, to require or compel the exercise of any ad valorem taxing power of the Issuer or any
other public authority or governmental body to pay the principal of or interest and premium, if
any, on the Note or to pay any other amounts required to be paid pursuant to the Note.
The opinions set forth below are expressly limited to, and we opine only with respect to,
the laws of the State of Florida and the federal income tax laws of the United States of America.
Based upon the foregoing, we are of the opinion that:
The Ordinance, Resolution and Agreement have been duly authorized, executed
and delivered by the Issuer and each constitutes a valid and binding obligation of
the Issuer enforceable in accordance with their terms.
2. The Note has been duly authorized, executed and delivered by the Issuer and is a
valid and binding special obligations of the Issuer, payable solely from the
Pledged Revenues as provided therefor in the Agreement.
{28117612;1}
City of Cape Canaveral, Florida
Hancock Bank
February 26, 2014
Page 3
3. The interest on the Note is excludable from gross income for federal income tax
purposes and is not treated as an item of tax preference for purposes of the federal
alternative minimum tax imposed on individuals and corporations but is taken into
account in determining adjusted current earnings for purposes of computing the
alternative minimum tax on corporations. The opinions set forth in the
immediately preceding sentence are subject to the condition that the Issuer
comply with all requirements of the Internal Revenue Code of 1986, as amended,
and the regulations thereunder (the "Code "), that must be met or satisfied in order
that interest thereon be, or continue to be, excludable from gross income for
federal income tax purposes. The Issuer has covenanted in the Agreement to
comply with each such requirement. Failure of the Issuer to comply with any of
such requirements may cause the inclusion of interest on the Note in gross income
for federal income tax purposes retroactive to the date of issuance of the Note.
Other provisions of the Code may give rise to adverse federal income tax
consequences to particular holders of the Note. The scope of this opinion is
limited to the matters addressed above and we express no opinion regarding other
federal tax consequences arising with respect to the Note other than as provided in
paragraph 4 below. In rendering the opinion expressed above, we have assumed
continuing compliance with the tax covenants referred to above that must be met
after the issuance of the Note in order that interest on the Note not be included in
gross income for federal income tax purposes.
4. The Note is a "qualified tax - exempt obligation" within the meaning of Section
265(b)(3) of the Code. In rendering this opinion, we have relied on certain factual
representations of the Issuer included as part of the closing transcript for the Note.
We call your attention to the fact that our engagement as Bond Counsel was on the
assumption that the Note would be marketed as a private placement with an institutional
investor, i.e., Hancock Bank. In accordance with our understanding with the parties participating
in the closing on the date hereof, we have not passed upon and consequently express no opinion
as to the accuracy, adequacy or completeness of any offering literature that may have been used
in connection with the offering or placement of the Note. We have not passed upon any matters
relating to the condition (financial or otherwise) of the Issuer and no inference should be drawn
that we have expressed any opinion on matters relating to the financial ability of the Issuer to
perform its obligations under the Agreement or the Note.
We express no opinions in connection with the issuance of the Note other than as
expressed herein.
It is to be understood that the rights of the owners of the Note and the enforceability of
the Note and the Agreement may be subject to bankruptcy, insolvency, reorganization,
{28117612;1}
City of Cape Canaveral, Florida
Hancock Bank
February 26, 2014
Page 4
moratorium and other similar laws affecting creditors' rights and laws and equitable principles
that may affect remedies or injunctive or other equitable relief, and to the exercise of judicial
discretion in appropriate cases.
Our opinions expressed herein are predicated upon present law, (and interpretations
thereof) facts and circumstances, and we assume no affirmative obligation to update the opinions
expressed herein if such laws (and interpretations thereof), facts or circumstances change after
the date hereof.
Very truly yours,
ZAIII� GG/°
AKERMAN LLP
(28117612;1)
i
IFBROWN, GARGANESE, WEISS & UAGRESTA, P.A.
orngs at aw
111 N. Orange Ave., Suite 2000
P.O. Box 2873
Orlando, Florida 32802 -2873
Phone (407) 425 -9566
Fax (407) 425 -9596
February 26, 2014
City of Cape Canaveral, Florida
Hancock Bank
113 Designer Circle
Dothan, Alabama 36303
CITY OF CAPE CANAVERAL, FLORIDA
$5,500,000 CAPITAL IMPROVEMENT REVENUE NOTE, SERIES 2014
(the "Note ")
Ladies and Gentlemen:
We have acted as City Attorney to the City of Cape Canaveral, Florida (the "City ") in
connection with the issuance by the City of its $5,500,000.00 Capital Improvement Revenue Note,
Series 2014 (the "2014 Note ") pursuant to the Constitution and laws of the State of Florida, including
particularly Chapter 166, Florida Statutes, Ordinance No. 03 -2014 adopted by the City in accordance
with the City Charter and other applicable provisions of law (collectively, the "Act "), and Resolution
No. 2014 -05 adopted by the City on February 18, 2014 and a Loan Agreement, dated as of February
26, 2014, by and between the City and Hancock Bank (the "Agreement "). Any capitalized terms not
otherwise defined herein shall have the same meaning as such term has under the Agreement.
In rendering the opinions set forth herein, we have reviewed the Constitution and laws of the
State of Florida, particularly Chapter 166, Florida Statutes, the City Charter, and such other laws,
documents, proofs, and proceedings as we have deemed necessary as a basis for the opinions
hereinafter expressed. Further, in giving the opinions expressed below, we do not purport to be
experts in or generally familiar with or qualified to express legal opinions based on the laws of any
jurisdiction (including but not limited to the laws of the United States) other than the State of Florida
and the City of Cape Canaveral.
As to questions of fact material to our opinion, we have relied upon representations of the
City contained in the Ordinance, the Resolution and the Agreement and in the certified proceedings
and other certifications of public officials furnished to us, without undertaking to verify the same by
independent investigation. We have not undertaken an independent audit, examination, investigation
or inspection of such matters and have relied solely on the facts, estimates, and circumstances
Ft. Lauderdale (954) 670 -1979 • Kissimmee (321) 402 -0144 • Cocoa (866) 425 -9566
Website: www.orlandolaw.net • Email: firm @orlandolaw.net
City of Cape Canaveral
Hancock Bank
February 26, 2014
Page -2 —
described in such proceedings and certifications. We have assumed the genuineness of signatures on
all documents and instruments unless certified by us in writing, the authenticity of documents
submitted as originals and the conformity to original documents submitted as copies. It is also
understood that we have and the City has relied on Note Counsel, Akerman LLP's opinion of even
date herewith for the issuance of legal advice and opinions regarding the 2014 Note, the Ordinance
and the Resolution contained therein, specifically as to the federal income tax opinion and the
qualified tax - exempt obligation status of the 2014 Note.
Whenever in this opinion a matter is limited by the term "to the best of our knowledge," such
statement is deemed to refer to our actual knowledge and excludes imputed knowledge, and we
disclaim any duty to verify the same by independent investigation.
The 2014 Note does not constitute a general obligation or indebtedness of the City within the
meaning of any constitutional, statutory or other limitation of indebtedness and the Holder of the
2014 Note shall never have the right to compel the exercise of any ad valorem taxing power of the
City or taxation in any form of any real or personal property for the payment of the principal of or
interest on the 2014 Note.
Based on such examination and inquiry, we are of the opinion that as of the date of this letter:
(i) the Resolution and Ordinance have been duly adopted and the Agreement and the
2014 Note have been duly authorized, executed and delivered by the City and each constitutes a
valid, binding and enforceable agreement of the City in accordance with their respective terms,
except to the extent that the enforceability of the rights and remedies set forth therein maybe limited
by bankruptcy, insolvency, financial emergency or other laws affecting creditors' rights generally or
by usual equity principles;
(ii) the City's execution, delivery and performance of the Agreement and execution and
issuance of the 2014 Note are not subject to any authorization, consent, approval or review of any
governmental body, public officer or regulatory authority not heretofore obtained or effected;
(iii) the execution, issuance and delivery of the 2014 Note has been duly and validly
authorized by the City, and the Agreement and the 2014 Note constitutes a valid and binding special
obligation of the City enforceable in accordance with its terms;
(iv) the City (A) is a municipal corporation duly organized and validly existing under the
laws of the State of Florida, and (B) has power and authority to adopt the Resolution and Ordinance,
to execute and deliver the Agreement, to execute and deliver the Agreement and the 2014 Note, and
to consummate the transactions contemplated by such instruments;
(v) the execution, delivery and performance of the 2014 Note and the Agreement, and
compliance with the terms thereof and hereof, under the circumstances contemplated hereby, do not
and will not in any material respect conflict with, or constitute on the part of the City a breach or
default under, any indenture, mortgage, deed of trust, agreement or other instrument to which the
City or to which its properties are subject or conflict with, violate or result in a breach of any existing
City of Cape Canaveral
Hancock Bank
February 26, 2014
Page -3 —
law, administrative rule or regulation, judgment, court order or consent decree to which the City or
its properties are subject;
(vi) there is no claim, action, suit, proceeding, inquiry, investigation, litigation or other
proceeding, at law or in equity, pending or to the best of our knowledge, now threatened, in any court
or other tribunal, state or federal (A) restraining or enjoining, or seeking to restrain or enjoin, the
issuance, sale, execution or delivery of the Agreement and the 2014 Note, (B) in any way questioning
or affecting the validity or enforceability of any provision of the Agreement, the 2014 Note, the
Resolution or the Ordinance, (C) in any way questioning or affecting the validity of any of the
proceedings or authority for the authorization, sale, execution or delivery of the Agreement and the
2014 Note, or of any provision made or authorized for the payment thereof, or (D) questioning or
affecting the organization or existence of the City or the right of any of its officers to their respective
offices;
(vii) the City has the legal authority to construct the Project, to grant a lien on the Pledged
Revenues as described herein and in the Agreement and the Resolution; and
(viii) all conditions contained in the ordinances and resolutions of the City precedent to the
issuance of the Agreement and the 2014 Note have been complied with.
Notwithstanding the foregoing, we express no opinion as to the applicability of any
approvals, consents or orders as may be required under the 'Blue Sky" or securities laws or legal
investment laws of any state in connection with the offering and sale of the 2014 Note or in
connection with the registration of the 2014 Note under the federal securities laws.
The opinions expressed herein are predicated upon present law, facts and circumstances, and
we assume no affirmative obligation to update the opinions expressed herein if such laws, facts or
circumstances change after the date hereof. Delivery of this opinion to parties other than the City
does not create an attorney - client relationship between this firm and such parties.
Respectfully submitted,
cJ
Brawn, iaqj g nese, Weiss & D Agresta, P.A.
No. 16
February 26, 2014
Akerman LLP ( "Bond Counsel ")
Orlando, Florida
Brown, Garganese, Weiss & D'Agresta, P.A. ( "City Attorney ")
Orlando, Florida
City of Cape Canaveral, Florida (the "City ")
Ladies and Gentlemen:
The undersigned, as a purchaser of the City of Cape Canaveral, Florida Capital
Improvement Revenue Note, Series 2014 (the "Note ") dated February 26, 2014, consisting of
one typewritten Note, hereby makes the following representations, which representations may be
relied upon by the addressees:
A. We are aware:
(i) that investment in the Note involves various risks;
(ii) that the Note is not a general obligation of the City of Cape Canaveral,
Florida; and
(iii) that the principal or premium, if any, and interest on the Note is payable
solely from the Pledged Revenues specified in that Loan Agreement dated as of
the Date hereof by and between the City and Hancock Bank (the "Agreement ").
B. We understand that no official statement, offering memorandum or other form of
offering document has been prepared or is being used in connection with the
offering or sale of the Note (collectively, "Disclosure Documents "), but we have
been afforded access to all information we have requested in making our decision
to purchase the Note. We have not requested any Disclosure Documents in
connection with the sale of the Note. We do not require any further information
or data incident to our purchase of the Note.
(2811813812)
February 26, 2013
Page 2 of 2
C. In purchasing the Note, we have relied solely upon our own investigation,
examination, and evaluation of the City, the Pledged Revenues and other relevant
matters.
D. We have knowledge and experience in financial and business matters related to
the purchase of obligations similar to the Note and are capable of evaluating the
merits and risks of our investment in the Note and have determined that we can
bear the economic risk of our investment in the Note.
E. We acknowledge that the Note is not being registered under the Securities Act of
1933 (the "1933 Act "), as amended or Chapter 517, Florida Statutes, and that the
Agreement is not being qualified under the Trust Indenture Act of 1939, as
amended, and that the City shall have no obligation to effect any such registration
or qualification.
F. We are not acting as a bond house, broker or other intermediary, and are
purchasing the Note with our own capital as an investment for our own account
and not with a present view to a resale or other distribution to the public.
Although we retain the right to transfer the Note in the future, subject to the
limitations set forth in the Agreement, we understand that the Note may not be
readily tradable.
G. We acknowledge that we are an "accredited investor" within the meaning of
United States Securities Act of 1933, and amended and Regulation D thereunder.
H. We acknowledge that Bond Counsel and the City Attorney have not represented
us on this transaction and that we are relying on them solely for the matters stated
in their respective legal opinions of even date.
I. We have received all documents requested by us incident to our purchase of the
Note.
J. We have not asked that the Note bear a CUSIP and we do not intend to seek a
CUSIP for the Note.
Capitalized terms not defined here have the meaning amended to them in the Agreement.
Signed as of the 26th day of February, 2014.
HANCOCK BANK
By:
Steve E. Cole, Senior Vice President
{28118138;2}
No. 16
February 26, 2014
Akerman LLP ( "Bond Counsel ")
Orlando, Florida
Brown, Garganese, Weiss & D'Agresta, P.A. ( "City Attorney ")
Orlando, Florida
City of Cape Canaveral, Florida (the "City ")
Ladies and Gentlemen:
The undersigned, as a purchaser of the City of Cape Canaveral, Florida Capital
Improvement Revenue Note, Series 2014 (the "Note ") dated February 26, 2014, consisting of
one typewritten Note, hereby makes the following representations, which representations may be
relied upon by the addressees:
A. We are aware:
(i) that investment in the Note involves various risks;
(ii) that the Note is not a general obligation of the City of Cape Canaveral,
Florida; and
(iii) that the principal or premium, if any, and interest on the Note is payable
solely from the Pledged Revenues specified in that Loan Agreement dated as of
the Date hereof by and between the City and Hancock Bank (the "Agreement ").
B. We understand that no official statement, offering memorandum or other form of
offering document has been prepared or is being used in connection with the
offering or sale of the Note (collectively, "Disclosure Documents "), but we have
been afforded access to all information we have requested in making our decision
to purchase the Note. We have not requested any Disclosure Documents in
connection with the sale of the Note. We do not require any further information
or data incident to our purchase of the Note.
{28118138;2}
February 26, 2013
Page 2 of 2
C. In purchasing the Note, we have relied solely upon our own investigation,
examination, and evaluation of the City, the Pledged Revenues and other relevant
matters.
D. We have knowledge and experience in financial and business matters related to
the purchase of obligations similar to the Note and are capable of evaluating the
merits and risks of our investment in the Note and have determined that we can
bear the economic risk of our investment in the Note.
E. We acknowledge that the Note is not being registered under the Securities Act of
1933 (the "1933 Act "), as amended or Chapter 517, Florida Statutes, and that the
Agreement is not being qualified under the Trust Indenture Act of 1939, as
amended, and that the City shall have no obligation to effect any such registration
or qualification.
F. We are not acting as a bond house, broker or other intermediary, and are
purchasing the Note with our own capital as an investment for our own account
and not with a present view to a resale or other distribution to the public.
Although we retain the right to transfer the Note in the future, subject to the
limitations set forth in the Agreement, we understand that the Note may not be
readily tradable.
G. We acknowledge that we are an "accredited investor" within the meaning of
United States Securities Act of 1933, and amended and Regulation D thereunder.
H. We acknowledge that Bond Counsel and the City Attorney have not represented
us on this transaction and that we are relying on them solely for the matters stated
in their respective legal opinions of even date.
I. We have received all documents requested by us incident to our purchase of the
Note.
J. We have not asked that the Note bear a CUSIP and we do not intend to seek a
CUSIP for the Note.
Capitalized terms not defined here have the meaning amended to them in the Agreement.
Signed as of the 26th day of February, 2014.
HANCOCK BANK
By• Y
Steve E. Cole, Senior Vice President
{28118138;2}
No. 17
TRUTH -IN- BONDING STATEMENT
City Council
City of Cape Canaveral, Florida
The City of Cape Canaveral, Florida (the "City ") is proposing to issue its $5,500,000
Capital Improvement Revenue Note, Series 2014 to finance the construction of a city hall and
other capital improvements (the "Note "). The Note is expected to be paid over a period of
approximately 10 years. At a fixed interest rate of 1.99 %, total interest paid over the life of the
Bonds (assuming no prepayments) will be $611,766.91. The Note is payable from and secured
solely by Pledged Revenues all as provided in that Loan Agreement dated February 26, 2014 by
and between the City and Hancock Bank. Authorizing these Bonds will result in a maximum
annual amount of $612,123.50 of such Pledged Revenues not being available to finance other
services of the City each year for approximately 10 years. This statement is provided to enable
the City to comply with applicable law and does not modify the terms of the Bonds.
HANCOCK BANK
By:
Name: Steven E. Cole
Title: Senior Vice President
{28117317;1}
No. 18
FLORIDA STATUTES, SECTION 218.385(6)
DISCLOSURE STATEMENT
RE: $5,500,000
City of Cape Canaveral, Florida
Capital Improvement Revenue Note, Series 2014
(the "Note ")
Dear City Council Members,
Hancock Bank (the "Purchaser ") is on the date hereof purchasing for its own account all
of the $5,500,000 initial aggregate principal amount of the referenced Note. The purpose of this
letter is to furnish, pursuant to the provisions of Section 218.385(6), Florida Statutes, certain
information in connection with our purchase of the Bonds as follows:
(a) The Purchaser is not incurring any expenses in connection with its purchase of the
Note, except our counsel, Bryant Miller Olive P.A. is being paid a fee of $4,500 by the Issuer.
(b) No person has entered into an understanding with the Purchaser, or to the
knowledge of the Purchaser, with the Issuer, for any paid or promised compensation or valuable
consideration, directly or indirectly, expressly or implied, to act solely as an intermediary
between the Issuer and the Purchaser or to exercise or attempt to exercise any influence to effect
any transaction in the purchase of the Note.
(c) The Note is being purchased by us for its face amount.
(d) We will not receive any management fee in connection with our purchase of the
Bonds.
We understand that you do not require any further disclosure from the Purchaser,
pursuant to Section 218.385(6), Florida Statutes.
February 26, 2014 HANCOCK RANK
113 Designer Circle
Dothan, Alabama 36303
By:
Name:
Title:
{28117437;1}
Steven E. Cole
Senior Vice President
BANK QUALIFIED LETTER
Akerman LLP
Orlando, Florida
Hancock Bank
Dothan, Alabama
No. 19
The undersigned City Manager of the City of Cape Canaveral, Florida (the "Issuer ") on
the date hereof does hereby certify on behalf of the Issuer in connection with the issuance by the
Issuer of its $5,500,000 City of Cape Canaveral, Florida Capital Improvement Revenue Note,
Series 2014 (the "Note "), as follows:
1. Proceeds of the Note are being used to construct a city hall and other Issuer
owned and operated capital improvements. No proceeds of the Note were or are being loaned
directly or indirectly to any entity other than the issuer.
2. The Issuer pursuant to Resolution No. 2014 -05 designated the Note as a qualified
tax - exempt obligation within the meaning of Section 265(b)(3) of the Internal Revenue Code of
1986, as amended (the "Code ").
3. I have reviewed financial information of the Issuer and have determined that the
aggregate face amount of all currently outstanding "tax- exempt" bonds or other "tax- exempt"
obligations (other than private activity bonds as defined in Section 141(a) of the Code), issued by
the Issuer (and any subordinate entities thereof and any issuer of "tax- exempt" debt that issues
"on behalf of the Issuer) during calendar year 2014 does not exceed $10,000,000. Based upon
reasonable investigation, it is reasonably expected that the Issuer (and any subordinate entities
thereof and any issuer of "tax- exempt" debt that issues "on behalf of the Issuer) will not issue in
excess of $10,000,000 of tax - exempt debt during calendar year 2014.
EXECUTED this 26th day of February, 2014.
CITY OF CAPE CANAVERAL, FLORIDA
By: 0 a—j 'i /
City Manager
(28117468; 1 }
ANAVERAL
CLOSING STATEMENT
CITY OF CAPE CANAVERAL
$5,500,000 Capital Improvement Revenue Note, Series 2014
February 26, 2014
Name
Title /Company
Role
Telephone /ema it
Fax
David Greene
City Manager
Issuer
321.868.1230 /
321.868.1224
d.greene@cityofcanaveral.org
Angie Apperson
Asst City Manager & City
Issuer
321.868.1220 x1221 /
321.868.1248
Clerk
a.apperson aIcityofcanaveral.org
John DeLeo
Finance Director
Issuer
321.868.1220 x 230 /
321.868.1248
i.deleo @cityofcanaveral. o
Anthony Garganese,
Brown Garganese Weiss,
City Attorney
407.425.9566 /
407.425.9596
Esq.
& D'Agresta, P.A.
agarganeseaorlandolaw.net
Steve Cole, Senior
Hancock Bank
Lender
334.792.8422 /
334.792.8424
VP
Steven. Cole(5)hancockbank.com
George Smith, Esq.
Bryant Miller & Olive,
Lender's
850.222.8611 /
850.222.8969
P.A.
Counsel
george(a)bmolaw.com
Michael Williams,
Akerman Senterfitt
Bond Counsel
407 - 419 -8439 /
407 - 843 -6610
Esq.
mike.williams(a ) akerman.com
Jeff Larson, President
Larson Consulting
Financial
407 - 496 -1597 /
407 - 542 -3791
Advisor
Ilarson Ccb, larsonconsults.com
Larry Aubrecht, SVP
Larson Consulting
Financial
303 - 898 -0595 /
334 - 460 -6223
Advisor
laubrechtalarsonconsults.com
John Moran, CPA, VP
Larson Consulting
Financial
303 - 635 -3180 /
303 - 962 -0307
Advisor
imoran .larsonconsults.com
Nicole Larson,
Larson Consulting
Financial
407 - 716 -5037 /
407 - 542 -3791
Associate
Advisor
nlarson @larsonconsults.com
I. Pre - Closing: (Signing of Hancock Bank Loan Documents)
Date: Tuesday, February 25, 2014;
Time: 3:00 PM EST at City Hall
(Note — Bond Counsel to confirm and arrange for signatures)
II. Closing: Funding of Hancock Loan
Date: Wednesday, February 26, 2014 (Telephonic)
Time: 10:00 AM EST (Mike Williams /Steve Cole /Jeff Larson to coordinate
closing via phone and email).
City of Cape Canaveral, Florida
$5,500,000 Capital Improvement Revenue Note — Series 2014
Page 2 of 3
III. Wire Transfers, Transfers and Flow of Funds
The following wire and /or transfers will occur:
1. Hancock Bank wire to City of Cape Canaveral for Project Funds
On Wednesday morning, February 26, 2014 by 10:00 AM EST, Hancock Bank will
wire $5,445,000 to the City of Cape Canaveral, FL Project investment account at
BMO Harris Bank, N.A., custodian bank for Florida Safe. This represents the Project
Construction Fund.
Wiring Instructions:
Bank: BMO Harris Bank, N.A.
ABA #: 071000288
Beneficiary Name: City of Cape Canaveral, Florida
Account#: 253 -898 -1
Reference City of Cape Canaveral, Florida Capital Improvement
Revenue Note 2014; contact Judy Moore, PMA/FL
SAFE, Telephone # - (855) 202 -9650
IMAD /Fed Ref#: 201402261_1 LFBE2C000059
Sent By: Hancock Bank
Date and Time: 2/26/2014 ; 8:53 AM, CST
Receipt Confirmed: Judy Moore, PMA/FL Safe
2. Hancock Bank wire to City of Cape Canaveral for Cost of Issuance Funds
On Wednesday morning, February 26, 2014 by 10:00 AM EST, Hancock Bank will
wire $55,000 to the City of Cape Canaveral, FL operating account at Wells Fargo
Bank. This represents the estimated Cost of Issuance of $55,000.
Wiring Instructions:
Bank:
ABA #:
Beneficiary Name
Account#:
Reference
Wells Fargo Bank, N.A.
121000248
City of Cape Canaveral
236122 - 0043720
City of Cape Canaveral, Florida;
(321) 868 -1220, ext 230
contact John DeLeo,
IMAD /Fed Ref#: 201402261_1 LFBE2C000152
Sent By: Hancock Bank
Date and Time: 2/26/2014: 9:59 AM, CST
Receipt Confirmed: John DeLeo, Finance Director, City of Cape Canaveral
City of Cape Canaveral, Florida
$5,500,000 Capital Improvement Revenue Note — Series 2014
Page 3of3
Upon receipt, John DeLeo and Judy Moore will confirm by email to the Working
Group the receipt of funds. Jeff Larson or Mike Williams at Akerman will email
the Working Group confirming closing, following notification from the City of Cape
Canaveral and LCS.
IV. City of Cape Canaveral Officer Certification- For Wi
(,
Authorized by: ��., - -- Date: d
John DeLeo, Finance Director
V. Procedures for Closing
To close the transaction, the following will occur:
All parties at the end of Pre - closing will have confirmed that the required Ordinance,
Loan Financing documentation and other certificates prepared by Bond Counsel and Bank
Counsel, and relevant Issuer's Counsel and Tax Counsel's opinion's, have been received and
approved. Hancock Bank will receive their necessary documents at Pre - closing, including an
executed copy of this Closing Statement by an authorized officer of the City of Cape
Canaveral, to allow for the early release of the Fed Funds wire on the day of closing.
• Larson Consulting Services to verify wire transfer by receipt of Fed Wire Reference
Numbers and Time Sent for 2014 Loan closing.
• Invoices from the Working Group should be presented by 3 pm EST on Tuesday
February 18th to John DeLeo with a copy sent via email to Jeff Larson, Larson
Consulting Services. Those received will be reviewed prior to Pre - closing by the
Issuer and Financial Advisor against the estimated cost of Issuance. Once
approved, The City of Cape Canaveral will authorize either a release of the check to
the appropriate party at pre - closing, dated the day of Closing, or authorize on the
Closing date the payment of the invoices by ACH or wire.
• Following closing, it is recommended that the COI account be closed after a two to
three month period, with any remaining funds free to go to either the Project Fund or
Sinking Fund for use by the City of Cape Canaveral.
LCS will work with the City of Cape Canaveral prior to pre - closing, and after closing,
to assist with the investment of net, Loan Proceeds so as to meet the estimated spend
down requirements on the project.
Emails
d. reene cit ofca ecanaveral.or
a.a erson cit ofca ecanaverai.or
.deleo cit ofca ecanaveral.or
a ar anese orlandolaw.net
larson larsonconsults.com
laubrecht larsonconsuIts.com
nlarson larsonconsults.com
imoran larsonconsults.com
mike.williams akerman.com
Steven.Cole hancockbank.com
eor e bmolaw.com