Loading...
R91-169RESOLUTION NO. R91-/~ A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOYNTON BEACH, FLORIDA, AUTHORIZING AND DIRECTING THE MAYOR AND CITY CLERE TO ENTER INTO A COM~ITMENT TO ISSUE A FINANCIAL GUARANTY INSURANCE POLICY WTTH MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION (MBIA), A COPY OF SAID COMMITMENT BEING ATTACHED HERETO AS EXHIBIT "A"; AND PROVIDING AN EFFECTIVE DATE. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF BOYNTON BEACH, FLORIDA THAT: Section 1. The Mayor and City Clerk are hereby authorized and directed to enter into a Commitment to issue a Financial Guaranty insurance Policy with Municipal Bond Investors Assurance Corporation, said Commitment being attached hereto as Exhibit "A". Section 2. This Resolution shall take effect immediately upon passage. PASSED AND ADOPTED this /~ day of October, 1991. ATTEST: C~ Clerk (Corporate, seal CITY OF BOYNTON BEACH, FLORIDA Vlce Mayor do~ssioner DISTRIBUTION LIST Underwriter Name Address Attention : Smith Barney, Harris Upham & Co.. Inc. 625 North Flagler Drive 8th Floor West Palm Beach, Florida Mr. David Levy 33401 Phone; 91-07-6072 (407) 655-1122 Bond Counsel Name Address Attention Moyle, Flanigan, Katz, Fitzgerald and Sheehan 625 North Flagler Drive Ninth Floor West Palm Beach, Florida 33401 Mark Raymond, Esq. Phone: (407) 659-7500 Underwriter Counsel Name : Wollett & Brady : Address : 3300 PGA Boulevard : Ninth Floor : Palm Beach Gardens, Florida : Attention : Frank Brady, Esq. 33410 Phone: (407) 622-0800 Name : City of Boynton Beach Address 100 East Boynton Beach Boulevard Boynton Beach, Florida 33425 Attention : Mr. J. Scott Miller Phone: (407) 738-7400 RE: C(I~{I~ ~) ISSUE A FINANCIAL ~JARANT~ INSURANCE POLICY Application No,: 91-07-6072 Sale Date: October, 1991 (T) pr~gramT~pe: Negotiated DP $4,680,000 (Est) City of Boynton Beach, Florida, Recreational Facilities Refunding Revenue Bonds, Series 1991 (the "Obligations") This commitment to issue a financial guaranty insurance policy (the "Commitment") dated September 26, 1991, constitutes an agreement between the CITY OF BOYNTON BRACH (the "Applicant"), and MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION (the "Insurer"), a stock insurance company incorporated under the laws of the State of New York. Based On an approved application dated September 17, 1991, the Insurer agrees, upon satisfaction of the conditions herein, to issue on the earlier of (i) 120 days of said approval date or Ill) on 'the date of delivery of and payment for the Obligations, a financial guaranty insnrance policy (the "Bond Insurance Policy"), for the Obligations, insuring the payment of principal of and interest on the Obligations when due. The issuance of the-Bond Insurance Policy shall be subject to the following terms and conditions: 1. Payment by the Applicant, or by the Trustee on behalf of Applicant, on the date of delivery of and payment for the Obligations, following payments: a. a nonrefundable premium in the amount of 1.52% of total debt service, less credit of $28,000, premium rounded to the nearest thousand. The premium set out in this paragraph shall be the total premium required to be paid on the Bond Insurance Policy issued pu~r~suant to this Commitment; and b. Standard & Poor's Corporation rating agency fees in an amount to be billed directly by Standard & Poor's Corporation, based on the final par and other factors as determined by Standard & Poor's Corporation; and c. Moody's Investors Service rating agency fees in an amount to be billed directly by Moody's Investors Service, based on the final par and other factors as determined by Moody's Investors Service. the the 2. The Obligations shall have received the unqualified opinion of bond counsel with respect to the validity of the Obligations and other matters customarily provided by the Bond Counsel. 3. There shall have been no material adverse change ~n the Obligations or the Resolution, Bond Ordinance, Trust Indenture or other official document authorizing the issuance of the Obligations or in the final official statement or other similar document, including the financial statements included therein~- 4. There shall have been no material adverse change in any information submitted to the Insurer as a part of the application or subsequently submitted to be a part of the application to the Insurer. -2- 5. No event shall have occurred which would allow'any underwriter or any other purchaser of the Obligations not to be required to purchase the Obligations at closing. §. Ail documents executed in connection with the iissuance of the Obligations shall contain a provision which requires copies Of any amendments to such documents consented to by-the Insurer to be sent to Standard & Poor's. 7. A Statement of Insurance satisfactory to the Insureri shall be printed on the obligations. 8. Prior to the delivery of and payment for the Obligations, none of the information or documents submitted as a part of the application to the Insurer shall be determined to contain any untrue or misleading~ statement of a material fact or fail to state a material fact required to be stated therein or necessary in order to make the statements contained therein not misleading. 9. No material adverse change affecting any security fo,r the Obligations shall have occurred prior to the delivery of and payment for the Obligations. 10. This Commitment may be signed in counterpart by the parties hereto. 11. Receipt by Municipal Bond Invesfors Assurance Corporation of the final debt service schedule on the issue within three business days from the sale date. 12. Receipt, satisfactory review and subsequent o~al approval by Municipal Bond Investors Assurance Corporation of draft copies of the CPA's verification, escrow securities purchase contracts of SLG subscription forms and escrow agreement at least ten businass days prior to closing. Final and signed copies of all the above documents to be sent via overnight mai] from closing. 13. Receipt by Municipal Bond Investors Assurance Corporation at least five business days prior to ctos~ng of a draft opinion from~Bond counsel (or Special Tax Counsel) to the effect that the refunding bonds are being issued in compliance wiLh state law and that the interest on the refunding bonds is tax-exempt. 14. Receipt by Municipal Bond Investors Assurance Corporation at least five business days prior to closing of a draft opinion f~om Bond Counsel stating that the refunded bonds have been legally defeased. (This condition is only applicable in those situations where the refunding issue is legally defeasing the refunded issue.) Final executed copies of ~I3 and ~14 to he sent vis overnight mail. -3- 15. If the escrow agreement allows for the substitution of securities in the escrow account, then it should be provided in the escrow agreement that no to the such subst~tutlo may occur unless there has first been delivered escrow agent/trustee, (1) a CPA verification that the escrow investments, as substltated, are sufficient to pay debt service~ as it becomes due, on the refunded bonds and (2) an opinion of nationally recognized bond counsel to the effect that the substitution is ~e~mitted under the documents and the substitution has no adverse effect on the tax-exempt nature of the refunding bonds~. 16. Escrow investments must be limited to: A. Cash B. U.S. Treasury Certificates, Notes D. and Bonds (including State and Local Government S~ries -- "SLG$"). Direct obligations of the Treasury which have been stripped by the Treasury itself, CATS, TIGR$ and similar securities. Resolution Funding Corp. (REFCORP) Only the interest component of REFCORP strips which have been stripped by request to the Federal Reserve Bank of New York in book entry form are acceptable. Pre-refunded municipal bonds rated "Aaa" by Moody's or "AAA" by $&p. If however, the issue is only rated by $&P (i.e., there is no Moody's rating), then the pre-refunded bonds must have been pre-refunded with cash, direct U.S, or U.S, guaranteed obligations, or AAA rated pre-refunded municipals to satisfy this condition. Obligations issued by the following agencies which are backed by the full faith and credit of the U.S.: a. U-S- ~xport-ImDort Bank (Eximbank) Direct obligations or fully guaranteed certificates of beneficial ownership b. Farmers Home Administration (FHA) Certificates Of beneficial ownership c. ~ederal Financing Bank d. ~eneral Services Administration Partlcipationlcertiflcates __ e. U-S, Maritime~Administratlon Guaranteed Title XI financing f. U-S, Department of Housinq and Urban Development (HUD) Project Notes Local Authority Bonds New Communities Debentures U.S. government guaranteed debentures U.S. Public Housing Notes and Bonds U.S. government guaranteed public housing notes and bonds - -4- 17. Adjustment to the flow of funds such that payments are Debt Service Account before the Operations and Maintenance Account. made to the 18. Increase in the rate covenant such that rates and charges for the use of the golf course produce gross revenues of the golf course equal (i) ~00% of the operation and- maintenance expenses; (ii) 125% of the ~debt service requirements on the Bonds; and (iii) 100% of any.deposits required to the Renewal and Replacement Fund and the Reserve Account. 19) Increase in ~he Additional Bonds Test such that additional parity obligations~may be issued if there is CPA verification that for any twelve consecutive months of the eighteen months immediately precedinq the issuance of the additional parity obligations: Ia) Either (i) the amount of Net Revenues from the golf course equal at least 1~25x MADS for all out§tanding and proposed parity obligations~ and 1.00x MADS for all outstanding subordinated indebtedness or (ii) the Net Revenues plus the Public Service Tax Revenues, equal at least 1.50x MADS for all 6utstanding and proposed parity obligations and 1.00x MADS for all outstanding subordinated indebtedness, (b) The Public Se=vice Tax, Revenues alone equal at least 1.25x MADS on ail outstanding and p~oposed parity obligations and 1.00x MADS on all o~tstandi~g subordinated indebtedness. Dated this 26th day of September, 1991. MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION Assistant 8~cretary CITY OF BOYNTON BEACH By Title: THE MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION INSURANCE POLICY The following information has been fUrnished by Municipal Bond Investors ............ ~ ~=- --se in this official Statement. Assurance Corporation {the m?ade to ~FF==~'----kn~:x for a specimen of the Insurer S polxcy. Referenceis The Insurer's ] and complete payment regu%red to Paying Agent or its Successor of (either at the st mandatory sinking shall becomedue acceleration o: and i~revocably guarantees the full ~f the Issuer to the Ii) the prlncipal of o~ maturity pursuant to a such payments that[in the event of any reason of mandatory or other and any such not been any such ~uant to a ~,any ~titutes ap~ The p~epayment The loss sinking an accelerated basis; ~ by an owner The thereof; or :(iv) [ of or or any other interest on for the Bonds. act Or omiss~on of .ce, such notice ! mail, or upon from Upon receipt of telephonic subsequently confirmed in writing receipt of ~ritten notice by regist the Paying Agent or any o--wner of a Bond t~e payment~ of an insured amount for which is then due, that such required payment has not been made, the Insurer te of such payment or within, one business day after receipt of on the due da notice of such nonpayment, ~hichevei is ~l~f, will make a deposit of funds, in an account with Citibank, N.A., in Newi York, New York, or its successor, sufficient for the payment of any such '~.~su~ed amounts which are then due. Upon presentment and surrender!Df such BOnd~ or presentment' of such 'other proof of ownership of the Bonds~"t0~ether '~ith any appropriate instruments of assignment to evidence the assignment of the insured amounts due on the Bonds effect the as are paid by the Insurer, and appropriate instrLunents to appointment of the Insurer as agent~ for su~ 6wners of the Bonds in any legal proceeding related ~o payment of insured amounts on the Bonds, such instrnments being in a form satisfactory ~o Citibank, N.A., Citibank, shall disburse to such owners or the paying Agent payment of the insured amounts due on' such Bonds, less any amount held by the Paying Agent for the payment of such insured amounts and !legally available therefor. -2- The Insurer is t_he principal operating subsidiary of MBIA Inc. The principal shareholders of MBIA Inc. are The Aetna Casualty and Surety Company, The Fund American Companies, Inc., subsidiaries of CIGNA Corporation, and Credit Local de France, CAECL S.A.', and they own approximately 35% of the outstanding common stock of MBIA Inc. Neither MBIA Inc. nor its shareholders are obligated to pay the debts of or claims against the Insurer. The Insurer is a limited liabi~it~ corporation rather than a several liability association. The Insurer is domiciled in the State of Nqw York and licensed to do business in all 50 states, the District of Columbia and the Commonwealth of Puerto Rico. As of December 31, 1990, the Insurer had admitted assets of $1.8 billion (audited), total liabilities of $t.2 billion (audited), andtotal capital and surplus of $579 million (audited) prepared in accordance with statutory accounting practices prescribed or permitted by insurance regulatory authorities. As of June 30, 1991 the Insurer had admitted assets of $2.1 billlon (unaudited), total llabillties of $1.5 hilllon.(unaudited), and total capital and -surplus of $606 million (unaudited) determined in accordance with statutory accounting practices prescribed or permitted by insurance regulator~ authorities. Copies of the InsorerLs ~ear end financial' statements prepared in accordance with statutory accounting practices, are available from the Insurer. The address of the Insurer is 113 King Street, Armonk, New York 10504. Moody's Investors Service rates ~11 bond issues insured by-the Insurer "Aaa" and short' term loans "MIG 1," both designated to be of the highest quality. Standard & Poor's Corporation rates all new issues insured by the Insurer "AAA" Prime Grade. The Moody's Investors Service rating of the Insurer should be evaluated independently of the Standard & Poor's Corporation rating of the Insurer. No application has been made to any other rating agency in order to obtain additlonal ratings on the Bonds. The ratings reflect the respective rating agency's current assessment of the creditworthiness of the Insurer and its ability to pa~ claims on its .policies of insurance. Any further explanatlon as to the significance of the above ratings may be obtained only from the applicable rating agency. The above ratings are not recommendations to buy, sell or hold the Bonds, and such ratings may be subject to revision or withdrawal at any time by the rating agencies. Any downward revision or withdrawal of either or both ratings may have an adverse effect on the market price of the Bonds. There can be no assurances that payments made by the Insurer representing interest on the [obligations] will be excluded from gross income, for federal tax purposes, in the event of nonappropriatlon by the [political subdivision]. The insurance provided by this Policy is not covered by the Florida Insurance Guaranty Association created under chapter 631, Florida Statutes. FL/LSE The ~unici~al BOnd Investors Assurance Corporation (the "Insurer") has issued a poli~y containing the following ~r~v'isions. such~policy being on file at The Insurer. in consideration of the payment ~f the ~emium and subject to th~ terms of 'th{s p~ii~. ,hereby u~conditionally ~nd irrevocably guarantees to any o%rner, as hereinafter .defined. of the following described obligations, the full and complete payment required to be made by or on behalf of the Issuer to or its successor (the "Paying Agent's)O~ ~n',amount equal t°i (i) the{~principal of (either at]the statea matnri~elrlb~ ~ny~advancem~nt~f maturity p~rsna~t to a mandator~ sinking f%t~d palrmen~)i~n~ %n~e~e~t, on. ~e~ O~ll~t%%ns (~s~h~ term ~s defined below) ~s s~ch palnB~nts shall become due but snail non ~= principal by reasonl ~f mandatory~ or optional redemption or accemera~ res~ltlng from default Dr otherwise, other than any advancement of maturity pursuant te a m~ndatory sinking fund payment', the payment~ guaranteed hereby shall be made in such amounts an~ at such times~ as such ~ayments oi p~inci~al ~ ..... k~ _~ been any ~sueh acceleration); and (ii) the ~-~u~enbteTfG~:y~c~ which! ~s subsequently recovered from any owner pursuant to a fill ~ndgment by a court of competent jurisdiction that such payment constitutes an avoidable ~reference to such owner within the meaning of any applicable bankruptcy law. Th~ amounts referred to in clauses (i) and (ii) of the preceding sentence Shall be referred to herein cotlectivel~ as the "Insured~;kmounts-" "Obliganions" shall mean: Upon receipt of telephonic or telegraphic notice, such notice Subsequently confirmed in writing by registered or certified mail, or upon receipt of written notice by registered or c~rtified mail, by the Insurer from the Paying Agent or any owner of an Obligation the payment of an Insured Amount for which is theu due, that such required payment has not been made, the Iusurer on the due date of such payment or within one business day after receipt of-uotice of such nonpayment; whichever is later, will make a deposit--of funds, in an account with Citibank, N.A., in New York, New York, or its saccessor, sufficient for the payment of any such Insured Amounts which are then due. Upon presentment and surrender of such Obligations or presentment of such other proof of ownership of the Obligations, together with any appropriate instruments of assignment to evidence the assignment of the Insured Amounts due on the Obligations as are paid by the Insurer,-and appropriate instruments to effect the appointment of the Insurer as agent for such owners of the Obligations in any legal proceeding related to payment of Insured Amounts on the Obligations, such instruments being in a form satisfactory to Citibank, N.A., Citibank, N.A. shall disburse to such owners or the Paying Agent payment of the Insured Amounts due on such Obligations, less any amount held by the Paying Agent for the pDy~_ent of such Insured Amounts and legally available therefor. This policy does not insure against loss of any prepayment premium which may at any time be payable with respect to any Obligation. As used herein, t 0bliqation as indi or any designee Of %he include the Issuer o~ shall-mean the registered owner of any the hooks maintained by the Paying Agent, the Issuer, : for such purPose. The term owner ,shall not agreementI with the'Issuer constitutes the underlying security for~the0bligations& Any service of process on the Insurer may be made to the Insurer at its offices located at 113 Kinq Street, Armonk, New York 10504. This policy is non-cancellable for any reason. The premium on this policy is not refundable for any reason including the payment prior to maturity of the Obligations. The insurance provided by this Policy is not covered by the Florida Insurance Guaranty Association created under chapter 631, Florida Statutes. MUNICIPAL BOND INVESTORS ASSURANCE'~0RPORATION STD-R-FL-1 *Insert Name of Trustee or Paying Agent. FINANCIAL GUARANTY INSURANCE POLICY Policy No. XXXXXX M .......... ~ ...... c~.~, :on ~the -Insurer") in consideration of tig payma~ ~ the premium and subject to thc terrva of this A~el~t2 '1 of ~ amomlt c¢lua] to (I) th~ Drll~l~l! of (either at th~ :~at~ ~tufl~ ~ y ~ ~ ~ .. ~1 ~ ma& in such ~oun~ ~ at such-~ = ~u~n~ ~ p~,~ ~d have ~ ~e ~ ~,na~ ~ suCp ~n~f [~O~T~E OF OBLIGA~ONS] U~on ~ceipt of telephonle or tel~graphic notice, such nofic~ suhsequent~ confirmed in writing by regis~red or certified mail, o~ ~ v~e. ipt of, '. ......... :-----.~ A. ~-rtified map s,~ ti~ I~umr from O~ pavlne Agent or any owner of an ObligaUon th~ payment oz ~n msu~a .~-nount fo~ whmh ,s d~.n due, t.hat s~h ~l~s ~ ~u~ of ~h o~r ~c~-~o~ ~e ~ ~ch Ob gatio~ ~ss any ~ount ~ byr~ Pay~g Ag~ f~ ~e pay~at of such ~su~ ~o~ day of [MO~ ~1- COUN i Bt~IGNED: MUNICIPAL BOND INVESTORS AS SURANCE CORPORATION Resident Licensed Agent President City, Stat~ Date Assistant Secretary :. STD-RCSyFL4 ~enLs under the Policy A. In the event that, on the second Business Day, ~nd again on the Business Day, prior to the palrment date on the Obligations. the Paying Agent has not received sufficient moneys to pay all principal of and interest on the Obligations due on the second following or following, as th~ case may be, Business Day, the Pa~in~ Agent shall immediately notify the Insurer or its designee on the same Business Day by telephone or te~%graph, confirmed in writing b~ registered or certified mail, of the amount of the deficiency. B. If the deficiency is made up in whole or in part prior to or on the payment date, the Paying Agent shall so notify the Insurer or its designee. C. _In addition, if the Paying Agent has notice that any Bondholder has been required to disgorge palrments of principal or interest on the Obligation to a trustee in Bankruptcy or creditors or others pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes a voidable preference to such Bondholder within the meaning of any applicable bankruptcy laws, then the Paying Agent shall notify the Insurer or it~ deslgne~ of' such fact by telephone or. telegraphic notice, confirmed in wrltingby registered or certified mail. Di The Paying Agent is hereby irrevocably designated, appointed, directed and authorize~ to act as attorney-in-fact for Holders of the Obligations as folIow~: 1. If and to the extent there is a deficiency in amounts required to pay interest on the Obligations, the Paying Agent shall (a) execute and deliver to Citibank, N.A., or its successors under the Policy (the "Insurance Paying Agent"), in form satisfactory to the Insurance Paying Agent, an instrument appointing the Insurer as agent for such Holders in any legal proceeding related to the payment of such interest and an' assignment to the Insurer of the claims for interest to which such deficiency relates and which are paid by the Insurer, (b) receive as designee of the respective Holders (and not as Paying Agent} in accordance with the tenor of the Policy payment from the Insurance Paying Agent with respect to the claims for interest so assigned, and (c) disburse the same to such respective Holders; and 2. If and to the extent of a deficiency in amounts required to pay principal of the Obligations, the Paying Agent shall (a) execute and deliver to the Insurance Paying Agent in form satisfactory to the Insurance Paying Agent an instrument appointing the Insurer as agent for such Holder fn any legal proceeding relating to the payment of such principal and an assignment to the Insurer of any of the Obligation surrendered to the Insurance Paying agent of so much of the principal amount thereof as has not previously been paid or for which moneys are not held by the Paying Agent and available for such payment (but such assignment shall be delivered only if payment from the Insurance Paying Agent is received), (b) receive as designee of the respective Holders (and hoe as Paying Agent} in accordance with th~ tenor of the Policy payment therefor from the Insurance Paying Agent, amd (c) disburse the s~une to such Holders. E. palzments wit~ respect 5o claims for interest on and principal of Obligations disbursed by the Paying Agent £rom proceeds of the Policy shall not be considered to discharge the obligation of the Issuer with respect to such Obligations. and the Insurer shall become the owner of such unpaid Obligation and claims for the interest' in accordance with the tenor of the assignment made tO 'it under the provisions of this subsection or_ otherwise. F. Irrespec~ive-~of whether any such assignment is executed and delivered, the Issuer and ~the Paying Agent hereby agre9 ~or the benefit of the Insurer t~at. directly or indirectly account of principal of will be subrogated to the of such as provided and ~olel~'fr the Obligations~ and They recognize that to the extent the Insurer makes payments~ the Paying Agent), on ~ligatiqns. the Insurer Holders to receive the amount with interest thereon ;rated in this Indenture and 2. The~ prlncipal and the principal and interest shall he~, paid), with intere', Obligation. herein for the to Holders. 2 amount of such and interest recovered of the Policy. which ~ due and not to have been in this Indenture and the manner provided Est on the Obligations ~he Insurer as the o~rner of such rights to the amou~t of s~ch principal and interest. G. In connection~ with,~e of additional Obligations. the Issuer shall 'oflthe disclosure document, if any. circulated withrespe( H. Copies of any amend~me~ts~, made to the ~ocuments executed in connection with the is~,uance of the~ ~bl~g~t~ons which are consented to by the Insurer shall be sent ~o ~tandar~ R ~6or's Co~p0ration- I. The Insurer shall receive notice of the resignation or removal of the Paying Agent and the appointment of a successor thereto. J. The Insurer shall receive copies of all notices required to be delivered to~ Bondholders and, on am annual basis, copies of the Issuer's audited financial statements and Annual Budget. Notices: A~y notice that is~ required to be given to a holder of the Obligation or to the Paying Agent pursuant to the Indenture shall also be provided to the Insurer. All notices required uo be given ~o the Insurer under the Indennure shall be in ,writing and shall be sent b5' registered or certified mail addressed Eo Municipal Bond Investors Assurance Corporation. 113 King Street, krmonk. New York 10504 Attention: Surveillance. 3065a