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17-02RESOLUTION NO. 17 -02 A RESOLUTION AUTHORIZING THE NEGOTIATED SALE OF NOT TO EXCEED $100,000,000 CITY OF CLEARWATER, FLORIDA, WATER AND SEWER REVENUE REFUNDING BONDS, SERIES 2017; AWARDING THE SALE THEREOF TO MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, ON BEHALF OF ITSELF AND RBC CAPITAL MARKETS AND WELLS FARGO SECURITIES AS THE CO- MANAGERS SELECTED BY THE CITY, SUBJECT TO THE TERMS AND CONDITIONS OF A PURCHASE CONTRACT; PROVIDING FOR THE ISSUANCE OF THE SERIES 2017 BONDS IN BOOK - ENTRY -ONLY FORM; AUTHORIZING THE DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT AND AN OFFICIAL STATEMENT IN CONNECTION WITH THE DELIVERY OF THE BONDS; PROVIDING FOR COMPLIANCE WITH A CONTINUING DISCLOSURE CERTIFICATE; APPOINTING A PAYING AGENT AND REGISTRAR; APPOINTING AN ESCROW HOLDER; APPOINTING A VERIFICATION AGENT AND ESCROW BIDDING AGENT; PROVIDING CERTAIN OTHER MATTERS IN CONNECTION WITH THE ISSUANCE AND DELIVERY OF SUCH BONDS; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, on August 2, 1984, the City Council of the City of Clearwater, Florida (the "City ") enacted Ordinance No. 3674 -84 (the "1984 Ordinance ") to provide for the issuance of bonds payable from Net Revenues of the System (as defined therein); and WHEREAS, on November 15, 2001, the City enacted Ordinance No. 6915 -01 (the "2001 Ordinance" and, together with the 1984 Ordinance, the "Original Ordinance ") which authorized the issuance of the City of Clearwater, Florida Water and Sewer Revenue [Refunding] Bonds, Series [to be determined], as Additional Bonds thereunder; and WHEREAS, on December 4, 2014, the City enacted Ordinance No. 8620 -14, amending the Original Ordinance (the "2014 Amending Ordinance" and, together with the Original Ordinance, the "Bond Ordinance "), the provisions of which shall apply to each series of Additional Bonds which are authorized on and after the date of enactment of the 2014 Amending Ordinance, retroactive to such date of enactment upon receipt of the consent of the holders of two- thirds in principal of Bonds then outstanding; and WHEREAS, the City by this Resolution intends to provide for the issuance of its not to exceed $100,000,000 City of Clearwater, Florida Water and Sewer Revenue Refunding Bonds, Series 2017 (the "Series 2017 Bonds ") as Additional Bonds to advance refund all or a portion of the City's outstanding Water and Sewer Revenue Bonds, Series 2009A (the "Series 2009A Bonds ") and Water and Sewer Revenue Refunding Bonds, Series 2011 (the "Series 2011 Bonds," the refunded portion thereof, collectively with the refunded portion of the Series 2009A Bonds, being referred to herein as the "Refunded Bonds "); and WHEREAS, in connection with the refunding of the Refunded Bonds, the City desires to enter into an Escrow Deposit Agreement in the form attached hereto as Exhibit A and to appoint U.S. Bank National Association as the Escrow Holder thereunder; and 1 Resolution No. 17 -02 WHEREAS, in addition to the Series 2009A Bonds and the Series 2011 Bonds, the City has currently outstanding under the Bond Ordinance, its Water and Sewer Revenue Refunding Bonds, Series 2003, its Water and Sewer Revenue Refunding Bonds, Series 2009B and its Water and Sewer Revenue Refunding Bond, Series 2014 (collectively with any unrefunded portion of the Series 2009A Bonds or Series 2011 Bonds, the "Parity Bonds "); and WHEREAS, it is in the best interest of the City to provide for the negotiated sale of not to exceed $100,000,000 of Series 2017 Bonds; and WHEREAS, the City intends to negotiate a sale of the Series 2017 Bonds with Merrill Lynch, Pierce, Fenner & Smith Incorporated, on behalf of itself and as representative of the co- managers, RBC Capital Markets and Wells Fargo Securities (collectively, the "Underwriters ") subject to the terms and conditions contained herein and set forth in a Purchase Contract, a copy of which is attached hereto as Exhibit B (the "Purchase Contract ") and authorize its Mayor, or in his absence the Vice Mayor, and the City Manager to execute such Purchase Contract upon the approval of the terms thereof by the City Manager and the City Finance Director; and WHEREAS, the City now desires to approve the issuance of its Series 2017 Bonds, to sell its Series 2017 Bonds pursuant to the Purchase Contract, to authorize the distribution of a Preliminary Official Statement and an Official Statement in connection with the issuance of the Series 2017 Bonds and to take certain other actions in connection with the issuance and sale of the Series 2017 Bonds; and WHEREAS, the City desires to appoint U.S. Bank National Association as the Registrar and Paying Agent under the Bond Ordinance with respect to the Series 2017 Bonds and to enter into a Registrar and Paying Agent Agreement in the form attached hereto as Exhibit C; and WHEREAS, the City will be provided all applicable disclosure information by the Underwriters as required by Section 218.385, Florida Statutes, prior to the execution of the Purchase Contract, a copy of which disclosure is to be attached to the Purchase Contract; and WHEREAS, this Resolution shall constitute a supplemental resolution under the terms of the Bond Ordinance, and all capitalized undefined terms used herein shall have the meanings set forth in the Bond Ordinance; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA: SECTION 1. The not to exceed $100,000,000 of the Water and Sewer Revenue Refunding Bonds, Series [to be determined] authorized by the Bond Ordinance being offered pursuant to this resolution are hereby designated as Series 2017 Bonds (the "Series 2017 Bonds "), provided that the series designation shall reflect the year in which the Series 2017 Bonds are actually issued. The issuance of not to exceed $100,000,000 of the Series 2017 Bonds by the City is hereby approved upon the terms and conditions set forth in the Bond Ordinance and this Resolution. SECTION 2. It is in the best interest of the City and the residents and inhabitants thereof that the Series 2017 Bonds be issued utilizing a pure book -entry system of registration. For so long as the Series 2017 Bonds remain in such book entry only system of registration, in 2 Resolution No. 17 -02 the event of a conflict between the provisions of the Bond Ordinance and the provisions of the Blanket Letter of Representations between the City and Depository Trust Company as previously executed and delivered, the terms and provisions of the Blanket Letter of Representations shall prevail. SECTION 3. (a) Due to the willingness of the Underwriters to purchase not to exceed $100,000,000 in aggregate principal amount of the Series 2017 Bonds at favorable interest costs and the importance of timing in the marketing of such obligations in conjunction with funding and structuring the defeasance escrow for the Refunded Bonds, it is hereby determined that it is in the best interest of the public and the City to sell the Series 2017 Bonds at a negotiated sale and such sale to the Underwriters pursuant to the terms and conditions contained in the Purchase Contract and herein is hereby authorized and approved, subject to the satisfaction of the conditions set forth in Section 3(b) below. (b) The Finance Director is hereby authorized to receive the offer to purchase the Series 2017 Bonds from the Underwriters in the form of an executed Purchase Contract in the form approved herein. The City Manager and the Finance Director are hereby authorized to award the sale of the Series 2017 Bonds on their determination that the offer submitted by the Underwriters for the purchase of all of the Series 2017 Bond is within the following parameters: (i) the refunding of that portion of the Refunded Bonds to be refunded by the Series 2017 Bonds shall provide the City with a net present value savings of not less than 4.0% of the par amount of such Refunded Bonds so refunded, (ii) the Underwriters' Discount shall not be in excess of .50% of the principal amount thereof, (iii) the final maturity shall not be later than December 1, 2039, and (iv) the principal amount shall not be in excess of the amount necessary to defease and redeem the Refunded Bonds plus costs of issuing the Series 2017 Bonds. The Finance Director, in coordination with the City's financial advisor and the Underwriters, is hereby authorized and directed to determine what portions of the Refunded Bonds are in the best interest of the City to be refunded through the issuance of the Series 2017 Bonds. The City Manager and the Finance Director are hereby authorized to award the sale of the Series 2017 Bonds as set forth above or to reject the offer from the Underwriters for any or all series of Series 2017 Bonds or any portion thereof. Such award shall be final. The acceptance of the offer to purchase the Series 2017 Bonds, to the extent the proceeds thereof are used to refund the Refunded Bonds shall constitute a decision to refund the Refunded Bonds in accordance with the Bond Ordinance. SECTION 4. The Series 2017 Bonds shall be sold to the Underwriters, upon the terms and conditions set forth in the Purchase Contract attached hereto as Exhibit B and incorporated by reference, upon the satisfaction of the conditions set forth in Section 3(b) hereof. The Mayor, or in his absence the Vice Mayor, the City Manager and the City Clerk are hereby authorized to execute such Purchase Contract in substantially the form attached as Exhibit B upon the approval of the City Attorney as to form and legal sufficiency, with such additional changes, insertions and omissions therein as do not change the substance thereof and as may be approved by the said officers of the City executing the same, such execution to be conclusive evidence of such approval. SECTION 5. The Series 2017 Bonds shall be dated, shall bear interest at a rate or rates not exceeding the maximum rate permitted by law, payable at the times, shall mature and shall be subject to redemption as provided in the Purchase Contract. The use of the proceeds of the Series 2017 Bonds, shall be as provided in the Official Statement relating to the Series 2017 Bonds. 3 Resolution No. 17 -02 SECTION 6. The Series 2017 Bonds shall be issued under and secured by the Bond Ordinance and shall be executed and delivered by the Mayor, the City Manager and the City Clerk upon the approval of the City Attorney as to form and legal sufficiency, in substantially the form set forth in the Bond Ordinance, with such additional changes and insertions therein as conform to the provisions of the Purchase Contract and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 7. U.S. Bank National Association is hereby appointed Registrar and Paying Agent for the Series 2017 Bonds to serve pursuant to a Paying Agent Agreement substantially in the form attached hereto as Exhibit C with such additional changes and insertions therein as approved by the officers executing the same, and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 8. U.S. Bank National Association is hereby appointed as the Escrow Holder under the Escrow Deposit Agreement for the Refunded Bonds, which Escrow Deposit Agreement shall be substantially in the form attached hereto as Exhibit A with such additional changes and insertions therein as approved by the officers executing the same, and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 9. Causey Demgen & Moore Inc. is hereby appointed as the Verification Agent and bidding agent for the defeasance of the Refunded Bonds and as bidding agent with respect to escrow obligations for such defeasance. SECTION 10. On the date of issuance of the Series 2017 Bonds, the City may transfer the funds on hand in the various funds and accounts established for the Refunded Bonds in such manner as may be approved by a certificate of the Finance Director executed prior to or simultaneously with the issuance of the Series 2017 Bonds. SECTION 11. The distribution by the Underwriters of the Preliminary Official Statement is hereby approved, confirmed and ratified. The distribution of a final Official Statement of the City relating to the issuance of the Series 2017 Bonds is hereby approved, such final Official Statement to be in substantially the form attached hereto as Exhibit D, with such additional changes, insertions and omissions as may be made and approved by officers of the City executing the same, such execution to be conclusive evidence of any such approval. The Mayor, or in his absence the Vice Mayor, and the City Manager are hereby authorized to execute such Official Statement in substantially the form attached hereto as Exhibit D. The execution of such Official Statement by such officers is hereby approved with such additional changes, insertions and omissions as may be made and approved by such officers. For purposes of Rule 15c2 -12 of the United States Securities and Exchange Commission (the "Rule "), the City Manager and the Finance Director are hereby authorized and directed to deem "final" the Preliminary Official Statement in substantially the form attached hereto as Exhibit D. SECTION 12. The City hereby covenants and agrees that, in order to provide for compliance by the City with the secondary market disclosure requirements of the Rule, that it will comply with and carry out all of the provisions of that certain Continuing Disclosure Certificate in substantially the form attached hereto as Exhibit E, to be executed by the City and dated the date of issuance and delivery of the Series 2017 Bonds, as it may be amended from time to time in accordance with the terms thereof (the "Continuing Disclosure Certificate "). Notwithstanding any other provision of this Resolution, failure of the City to comply with such 4 Resolution No. 17 -02 Continuing Disclosure Certificate shall not be considered an event of default; however, any holder of Series 2017 Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Section and the Continuing Disclosure Certificate. The Mayor, or in his absence the Vice Mayor, the City Manager and the City Clerk are hereby authorized to execute such Continuing Disclosure Certificate upon the approval of the City Attorney as to form and legal sufficiency, in substantially the form attached as Exhibit E, with such additional changes, insertions and omissions therein as do not change the substance thereof and as may be approved by the said officers of the City executing the same, such execution to be conclusive evidence of such approval. SECTION 13. All prior resolutions of the City inconsistent with the provisions of this resolution are hereby modified, supplemented and amended to conform with the provisions herein contained and except as otherwise modified, supplemented and amended hereby shall remain in full force and effect. SECTION 14. The Mayor, or in his absence the Vice Mayor, the City Manager, the Finance Director, the City Attorney and the City Clerk or any other appropriate officers of the City are hereby authorized and directed to execute any and all certifications or other instruments or documents required by the Resolution, the Purchase Contract, the Escrow Deposit Agreement or any other document referred to above as a prerequisite or precondition to the issuance of the Series 2017 Bonds and any such representation made therein shall be deemed to be made on behalf of the City, and the City Manager and the Finance Director are hereby authorized to take such actions as may be necessary or desired to effect the refunding of the Refunded Bonds, including, but not limited to, the selection of a verification agent and escrow investments. In the event both the Mayor and the Vice Mayor are unable to execute the documents related to the Series 2017 Bonds, then any other member of the City Council shall be authorized to execute such documents with the full force and effect as if the Mayor, or the Vice Mayor had executed same. All action taken to date by the officers of the City in furtherance of the issuance of the Series 2017 Bonds is hereby approved, confirmed and ratified. SECTION 15. For purposes hereof, the Reserve Requirement (as defined in the Bond Ordinance) for the Series 2017 Bonds shall be $0.00, and upon the effective date of the 2014 Amending Ordinance, the Series 2017 Bonds shall not be entitled to any security provided by any monies on deposit in the Reserve Account. Prior to such effective date, the Series 2017 Bonds shall be additionally secured by the funds on deposit in the Reserve Account as required by the Bond Ordinance, and as of the effective date of the 2014 Amending Ordinance, the Series 2017 Bonds shall cease to be secured by the Reserve Account. By purchasing the Series 2017 Bonds, the Bondholders consent to the amendments set forth in the 2014 Amending Ordinance. 5 Resolution No. 17 -02 SECTION 16. This resolution shall become effective immediately upon its adoption. Passed and adopted by the City Council of the City of Clearwater, Florida, this I - day of January, 2017. Approved as to form: Attest: aniela KlAkin City Attorney 6 CITY OF CLEARWATER, FLORIDA By: — G�oorLtt 1\ CrC\. �S George N. Cretekos Mayor C Rosemarie Call, City Clerk Resolution No. 17 -02 EXHIBIT A FORM OF ESCROW DEPOSIT AGREEMENT Resolution No. 17 -02 ESCROW DEPOSIT AGREEMENT This ESCROW DEPOSIT AGREEMENT, dated as of , 2017, by and between the CITY OF CLEARWATER, FLORIDA, a municipal corporation of the State of Florida (the "Issuer "), and U.S. BANK NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States of America, as Escrow Holder (the "Escrow Holder "); WITNESSETH: WHEREAS, the Issuer has previously authorized and issued obligations of the Issuer as hereinafter set forth defined as the "Refunded Bonds ", as to which the Annual Debt Service (as hereinafter defined) is set forth on Schedule A; and WHEREAS, the Issuer has determined to provide for payment of the Aggregate Debt Service of the Refunded Bonds by depositing with the Escrow Holder pursuant to the provisions hereof, cash and Federal Securities (as defined herein), the principal of and interest on which will be at least equal to the Aggregate Debt Service; and WHEREAS, in order to obtain the funds needed for such purpose, the Issuer has authorized and is, concurrently with the delivery of this Agreement, issuing the Series 2017 Bonds more fully described herein; and WHEREAS, the Issuer has determined that the amount to be on deposit from time to time in the Escrow Account, as defined herein, will be sufficient to pay the Aggregate Debt Service; NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, the Issuer and the Escrow Holder agree as follows (provided however that the Escrow Holder in agreeing to the foregoing shall not be held or deemed responsible in any manner whatsoever for the recitals made herein or in the Ordinance, or the adequacy or sufficiency of the Escrow Requirement): Section 1. Definitions. As used herein, the following terms mean: (a) "Aggregate Debt Service" means, as of any date, the sum of all present and future Annual Debt Service payments then remaining unpaid with respect to the respective Series of the Refunded Bonds. (b) "Agreement" means this Escrow Deposit Agreement. (c) "Annual Debt Service" means, with respect to the redemption date for the Refunded Bonds, the principal of and interest and premium, if any, on the Refunded Bonds coming due after the date hereof but on or before the Call Date as shown on Schedule A attached hereto. (d) "Bonds" or "Series 2017 Bonds" means the Water and Sewer Revenue Refunding Bonds, Series 2017 of the Issuer, authorized by the Ordinance, as herein defined. (e) "Call Date" means [with respect to the Series 2009A Bonds,] December 1, 2019 [and with respect to the Series 2011 Bonds, December 1, 2021]. (f) "Escrow Account" means the account established and held by the Escrow Holder pursuant to this Agreement, in which cash and investments will be held for payment of the Refunded Bonds. (g) "Escrow Holder" means U.S. Bank National Association, a national banking association organized under the laws of the United States of America. (h) "Escrow Requirement" means, as of any date of calculation, the sum of an amount in cash and principal amount of Federal Securities in the Escrow Account which, together with the interest due on the Federal Securities, will be sufficient to pay, as the installments thereof become due, the Annual Debt Service. (i) "Federal Securities" means direct obligations of the United States of America and obligations the principal of or interest on which are fully guaranteed by the United States of America, none of which permit redemption prior to maturity at the option of the obligor. (j) "Irrevocable Instruction and Authorization to Redeem Bonds" means a certificate executed by the Issuer which provides for redemption of certain of the Refunded Bonds on the Call Date, irrevocably instructs the Escrow Holder to give notice of such redemption and directs the Paying Agent for the Refunded Bonds to pay the Refunded Bonds and the interest thereon upon surrender thereof at maturity or on their Call Date. (k) "Issuer" means the City of Clearwater, Florida. (1) "Ordinance" means Ordinance No. 3674 -84 enacted by the Issuer on August 2, 1984, as amended and supplemented by Ordinance 6915 -01, enacted November 15, 2001, as amended by Ordinance No. 8620 -14, enacted by the Issuer on December 4, 2014, and as further supplemented by Resolution No. 16 -04, adopted on , 2017. 2 (m) "Paying Agent" shall mean U.S. Bank National Association, the Paying Agent for the Refunded Bonds, whose address is 225 E. Robinson Street, Suite 250, Orlando, Florida 32801. (n) "Refunded Bonds" shall mean the outstanding Series 2009A Bonds maturing on and after December 1, 2020 [and the outstanding Series 2011 Bonds maturing on and after December 1, 2022]. (o) "Restricted Securities" shall mean the Federal Securities identified as such on Schedule B attached hereto. (p) "Series 2009A Bonds" shall mean the Issuer's Water and Sewer Revenue Bonds, Series 2009A. (q) [ "Series 2011 Bonds" shall mean the Issuer's Water and Sewer Revenue Refunding Bonds, Series 2011.] (r) "Unrestricted Securities" shall mean the Federal Securities identified as such on Schedule B attached hereto. Section 2. Deposit of Funds. The Issuer hereby deposits $ with the Escrow Holder in immediately available funds, to be held in irrevocable escrow by the Escrow Holder and applied solely as provided in this Agreement. The Issuer represents that: (a) Such funds are all derived as follows: (1) $ from the net proceeds of the Series 2017 Bonds; (2) $ transferred from the Debt Service Fund; and (3) $ [transferred from the Debt Service Reserve Fund held for the Refunded Bonds.] (b) Such funds, when applied pursuant to Section 3 below, will at least equal the Escrow Requirement as of the date hereof. Section 3. Use and Investment of Funds. The Escrow Holder acknowledges receipt of $ and agrees: (a) to hold the funds in irrevocable escrow during the term of this Agreement, and 3 (b) to deposit the sum of $ of funds from the Debt Service Fund [and Debt Service Reserve Fund] and invest $ of such funds in the Unrestricted Securities identified as such on Schedule B hereto, and hold $ in cash, and deposit the sum of $ _ from the proceeds of the Bonds, and invest $ of such funds in the Restricted Securities identified as such on Schedule B hereto and hold $ in cash until the Call Date. (c) The Escrow Holder shall invest the moneys held in the Escrow Account upon written direction of the Issuer accompanied by (1) a list of the Federal Securities to be purchased, (2) a report of an independent certified accountant verifying the sufficiency of the receipts from the Federal Securities will be sufficient to redeem the Refunded Bonds on December 1, 2019 [with respect to the Series 2009A Bonds and on December 1, 2021 with respect to the Series 2011 Bonds], and (3) an opinion of Bond Counsel to the effect that such investment will not materially adversely affect the exclusion of the interest on the Series 2017 Bonds from income for purposes of federal income taxation. Section 4. Payment of Refunded Bonds. (a) Refunded Bonds. On the Call Date for the Refunded Bonds, the Escrow Holder shall pay to the Paying Agent for the Refunded Bonds, from the cash and proceeds of the Federal Securities on hand in the Escrow Account, a sum sufficient to pay the Annual Debt Service for the Refunded Bonds coming due on the redemption date as shown on Schedule A and as demonstrated on Schedule B hereto. (b) Surplus. On the Call Date, after making the payments from the Escrow Account described in Subsection 4(a), the Escrow Holder shall pay to the Issuer any remaining cash in the Escrow Account in excess of the Escrow Requirement, to be used for any lawful purpose of the Issuer. (c) Priority of Payments. The holders of the Refunded Bonds shall have an express first lien on the funds and Federal Securities in the Escrow Account until such funds and Federal Securities are used and applied as provided in this Agreement. If the cash on hand in the Escrow Account is ever insufficient to make the payments required under Subsection 4(a), all of the payments required under Subsection 4(a) shall be made when due before any payments shall be made under Subsections 4(b). (d) Fees and Expenses of Escrow Holder/Paying Agent. The Escrow Holder acknowledges that it is also acting in the capacity of Paying Agent, and on the date hereof, acknowledges receipt of its fees to serve as Escrow Holder and Paying Agent in the amount of $750.00 (which amount excludes reimbursement of any out of pocket expenses incurred by the 4 Escrow Holder/Paying Agent in performing its services hereunder), and further acknowledges that the Escrow Holder/Paying Agent does not have a lien on or claim against any funds held hereunder for reimbursement of such expenses. Section 5. Reinvestment. (a) Except as provided in Section 3 hereof, and in this Section, the Escrow Holder shall have no power or duty to invest any funds held under this Agreement or to sell, transfer or otherwise dispose of or make substitutions of the Federal Securities held hereunder. (b) At the written request of the Issuer and upon compliance with the conditions hereinafter stated, the Escrow Holder shall sell, transfer, otherwise dispose of or request the redemption of any of the Federal Securities acquired hereunder and shall either apply the proceeds thereof to the full discharge and satisfaction of the Refunded Bonds or substitute other Federal Securities for such Federal Securities. The Issuer will not request the Escrow Holder to exercise any of the powers described in the preceding sentence in any manner which would cause any Bonds to be "arbitrage bonds" within the meaning of the Internal Revenue Code of 1986, as amended, and the Regulations thereunder. The transactions may be effected only if (i) an independent certified public accountant shall certify to the Escrow Holder that the cash and principal amount of Federal Securities remaining on hand after the transactions are completed, together with the interest due thereon, will be not less than the Escrow Requirement, and (ii) the Escrow Holder shall receive an unqualified opinion from a nationally recognized bond counsel or tax counsel to the effect that the transactions will not cause such Bonds to be "arbitrage bonds" within the meaning of the Internal Revenue Code of 1986, as amended, and the regulations thereunder in effect on the date of the transactions and applicable to transactions undertaken on such date. Section 6. No Redemption or Acceleration of Maturity. Except as provided in the Irrevocable Instruction and Authorization to Redeem Bonds, the Issuer will not accelerate the maturity or due date of the Refunded Bonds. Section 7. Responsibilities of Escrow Holder. The Escrow Holder and its respective successors, assigns, agents and servants shall not be held to any personal liability whatsoever, in tort, contract, or otherwise, in connection with the execution and delivery of this Agreement, the establishment of the Escrow Account, the acceptance of the funds deposited therein, the purchase of the Federal Securities, the retention of the Federal Securities or the proceeds thereof or any payment, transfer or other application of money or securities by the Escrow Holder in any non - negligent act, non - negligent omission or non - negligent error of the Escrow Holder made in good faith in the conduct of its duties. The Escrow Holder shall, however, be liable to the Issuer for its negligent or willful acts, omissions or errors which violate or fail to comply with the terms of this Agreement. The duties and obligations of the Escrow Holder shall be 5 determined by the express provisions of this Agreement. The Escrow Holder may consult with counsel, who may or may not be counsel to the Issuer, and in reliance upon the opinion of such counsel shall have full and complete authorization and protection in respect of any action taken, suffered or omitted by it in good faith in accordance therewith. Whenever the Escrow Holder shall deem it necessary or desirable that a matter be proved or established prior to taking, suffering or omitting any action under this Agreement, such matter may be deemed to be conclusively established by a certificate signed by an authorized officer of the Issuer. The Escrow Holder has no duty to determine or inquire into the happening or occurrence of any event or contingency where the performance or the failure of performance of the Issuer with respect to arrangements or contracts with others, the Escrow Holder's sole duty and responsibility hereunder being to safeguard the Escrow Account and dispose of and deliver the same strictly in accordance with this Agreement. Section 8. Resignation of Escrow Holder. The Escrow Holder may resign and thereby become discharged from the duties and obligations hereby created, by notice in writing given to the Issuer and published once in a newspaper of general circulation published in the territorial limits of the Issuer, and in a daily newspaper of general circulation or a financial journal published or circulated in the Borough of Manhattan, City and State of New York, not less than sixty (60) days before such resignation shall take effect. Such resignation shall take effect immediately upon the appointment of a successor Escrow Holder hereunder and payments of all amounts due the resigning Escrow Holder. Section 9. Removal of Escrow Holder. (a) The Escrow Holder may be removed at any time by an instrument or concurrent instruments in writing, executed by the holders of not less than fifty -one per centum (51 %) in aggregate principal amount of each series of Refunded Bonds then outstanding, such instruments to be filed with the Issuer, and notice in writing given by such holders to all of the registered holders of each series of the Refunded Bonds and published once in a newspaper of general circulation published in the territorial limits of the Issuer, and in a daily newspaper of general circulation or a financial journal published or circulated in the Borough of Manhattan, City and State of New York, not less than sixty (60) days before such removal is to take effect as stated in such instrument or instruments. A photographic copy of any instrument filed with the Issuer under the provisions of this paragraph shall be delivered by the Issuer to the Escrow Holder. (b) The Escrow Holder may also be removed at any time for any breach of trust or for acting or proceeding in violation of, or for failing to act or proceed in accordance with, any provisions of this Agreement with respect to the duties and obligations of the Escrow 6 Holder, by the Issuer or by the holders of not less than twenty -five per centum (25 %) in aggregate principal amount of each series of the Refunded Bonds then outstanding. (c) No such removal shall take effect until a successor Escrow Holder shall be appointed hereunder. Section 10. Successor Escrow Holder. (a) If at any time hereafter the Escrow Holder shall resign, be removed, be dissolved or otherwise become incapable of acting, or shall be taken over by any governmental official, agency, department or board, the position of Escrow Holder shall thereupon become vacant. If the position of Escrow Holder shall become vacant for any of the foregoing reasons or for any other reason, the Issuer shall appoint a successor Escrow Holder to fulfill the duties of Escrow Holder hereunder. The Issuer shall publish notice of any such appointment once in each week for four (4) successive weeks in a newspaper of general circulation published in the territorial limits of the Issuer and in a daily newspaper of general circulation or a financial journal published or circulated in the Borough of Manhattan, City and State of New York, and, before the second publication of such notice shall mail a copy thereof to the original purchaser or purchasers of the Refunded Bonds. (b) At any time within one year after such vacancy shall have occurred, the holders of a majority in principal amount of each series of Refunded Bonds then outstanding, by an instrument or concurrent instruments in writing, executed by all such bondholders and filed with the governing body of the Issuer, may appoint a successor Escrow Holder, which shall supersede any Escrow Holder theretofore appointed by the Issuer. Photographic copies of each such instrument shall be delivered promptly by the Issuer, to the predecessor Escrow Holder and to the Escrow Holder so appointed by the bondholders. (c) If no appointment of a successor Escrow Holder shall be made pursuant to the foregoing provisions of this section, the holder of any Refunded Bonds then outstanding, or any retiring Escrow Holder may apply to any court of competent jurisdiction to appoint a successor Escrow Holder. Such court may thereupon, after such notice, if any, as such court may deem proper and prescribe, appoint a successor Escrow Holder. Section 11. Term. This Agreement shall commence upon its execution and delivery and shall terminate when the Refunded Bonds have been paid and discharged in accordance herewith, and all amounts held by the Escrow Holder hereunder have been applied in accordance herewith. Section 12. Severability. If any one or more of the covenants or agreements provided in this Agreement on the part of the Issuer or the Escrow Holder to be performed should be 7 determined by a court of competent jurisdiction to be contrary to law, such covenant or agreements herein contained shall be null and void and shall be severed from the remaining covenants and agreements and shall in no way affect the validity of the remaining provisions of this Agreement. Section 13. Counterparts. This Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as duplicate originals and shall constitute and be but one and the same instrument. Section 14. Governing Law. This Agreement shall be construed under the laws of the State of Florida. Section 15. Security for Accounts and Funds. All accounts and funds maintained or held pursuant to this Agreement shall be continuously secured in the same manner as other deposits of municipal funds are required to be secured by the laws of Florida. Section 15. Brokerage Requirements. The Issuer acknowledges that to the extent regulations of the Comptroller of the Currency or other applicable regulatory entity grant the Issuer the right to receive individual confirmations of security transactions at no additional cost, as they occur, the Issuer specifically waives receipt of such confirmations to the extent permitted by law. The Escrow Agent will furnish the Issuer periodic cash transaction statements that include detail for all investment transactions made by the Escrow Agent hereunder. [Remainder of page left intentionally blank — Signature pages follow] 8 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized officers and their official seals to be hereunto affixed as of the date first above written. (SEAL) A I PEST: CITY OF CLEARWATER, FLORIDA George N. Cretekos, Mayor Rosemarie Call, City Clerk William B. Horne, II, City Manager Approved as to Form, Sufficiency and Correctness: Pamela K. Akin, City Attorney [Issuer's Signature Page to Escrow Deposit Agreement] 9 U.S. BANK NATIONAL ASSOCIATION, as Escrow Holder By: Name: Title: [Escrow Agent's Signature Page to Escrow Deposit Agreement] 10 Schedule A (Debt Service; Description of Refunded Bonds) Series 2009A Bonds Payment Date Principal Interest Premium Total Debt Service Series 2011 Bonds Payment Date Principal Interest Premium Total Debt Service Schedule B Escrow Cash Flow Payment Date Principal Interest Total UNRESTRICTED SECURITIES Type of Security Maturity Date Par Amount RESTRICTED SECURITIES Type of Security Maturity Date Par Amount Rate Total Cost Rate Total Cost EXHIBIT B FORM OF BOND PURCHASE CONTRACT Resolution No. 17 -02 CITY OF CLEARWATER, FLORIDA WATER AND SEWER REVENUE REFUNDING BONDS, SERIES 2017 BOND PURCHASE AGREEMENT January , 2017 City Council of the City of Clearwater, Florida 112 S. Osceola Avenue Clearwater, FL 33756 Ladies and Gentlemen: Merrill Lynch, Pierce, Fenner & Smith Incorporated, on behalf of itself and as representative (the "Representative ") of RBC Capital Markets, LLC and Wells Fargo Bank, National Association (collectively, with the Representative, the "Underwriters "), hereby offers to enter into this Bond Purchase Agreement (the "Purchase Agreement ") with the City of Clearwater, Florida, a municipal corporation duly organized and validly existing under and pursuant to the laws of the State of Florida (the "Issuer "), whereby the Underwriters will purchase and the Issuer will sell the Bonds (as defined and described below). The Underwriters are making this offer subject to the acceptance by the Issuer at or before 5:00 P.M., Eastern Standard Time, on the date hereof. If the Issuer accepts this Purchase Agreement, this Purchase Agreement shall be in full force and effect in accordance with its terms and shall bind both the Issuer and the Underwriters. The Underwriters may withdraw this Purchase Agreement upon written notice delivered by the Representative to the Finance Director of the Issuer at any time before the Issuer accepts this Purchase Agreement. Terms used but not defined in this Purchase Agreement are defined in the Bond Ordinance (as defined below). 1. Purchase and Sale. Upon the terms and conditions and in reliance upon the representations, warranties and agreements herein set forth, the Underwriters hereby agree to purchase from the Issuer, and the Issuer hereby agrees to sell and deliver to the Underwriters, all (but not less than all) of the following bonds: City of Clearwater, Florida, Water and Sewer Revenue Refunding Bonds, Series 2017 (the "Bonds "), at the purchase price of $ , representing the aggregate principal amount of the Bonds less an Underwriters' discount of $ [plus net original issue premium of $ /less net original issue discount of $ 1. The Issuer acknowledges and agrees that: (i) the primary role of the Underwriters, as underwriters, is to purchase securities, for resale to investors, in an arm's length commercial transaction between the Issuer and the Underwriters, and the Underwriters have financial and other interests that differ from those of the Issuer; (ii) the Underwriters are acting solely as principals and are not acting as municipal advisors, financial advisors or fiduciaries to the Issuer 1 and have not assumed any advisory or fiduciary responsibility to the Issuer with respect to the transaction contemplated hereby and the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriters, or any of them, have provided other services or are currently providing other services to the Issuer on other matters); (iii) the only obligations the Underwriters have to the Issuer with respect to the transaction contemplated hereby expressly are set forth in this Purchase Agreement; and (iv) the Issuer has consulted its own financial and/or municipal, legal, accounting, tax and other advisors, as applicable, to the extent it has deemed appropriate. 2. Description and Purpose of the Bonds. The Bonds have been authorized pursuant to the charter of the Issuer, the Constitution and laws of the State of Florida, particularly Chapter 166, Part II, Florida Statutes and other applicable provisions of law (collectively, the "Act "), Ordinance Nos. 3674 -84, 6915 -01 and 8620 -14, duly enacted by the City Council of the Issuer (the "City Council ") on August 2, 1984, November 15, 2001, and December 4, 2014, respectively, as supplemented by Resolution No. 17 -02, duly adopted by the City Council on January 19, 2017 (collectively, the "Bond Ordinance "). The Bonds shall be dated the date of delivery. The proceeds of the sale of the Bonds will be used to (i) advance refund all or a portion of the Issuer's outstanding Water and Sewer Revenue Bonds, Series 2009A (the "Series 2009A Bonds ") and Water and Sewer Revenue Refunding Bonds, Series 2011 (the "Series 2011 Bonds," the refunded portion thereof, collectively with the refunded portion of the Series 2009A Bonds, being referred to herein as the "Refunded Bonds ") and (ii) pay certain costs of issuance associated with the Bonds. The Bonds will be secured from Net Revenues of the System, pursuant to the provisions of the Bond Ordinance. The Bonds shall mature in the years, bear interest, be purchased at the prices and be subject to optional and mandatory redemption at the times and in the amounts, all as set forth in Schedule I attached hereto. The Authorized Denominations, Record Dates, Interest Payment Dates, mandatory redemption provisions, and other details and particulars of the Bonds shall be as described in the Bond Ordinance and the Official Statement (as defined below) of the Issuer. The disclosure statement required by Section 218.385, Florida Statutes, is attached hereto as Exhibit A. 3. Public Offering. The Underwriters agree to make a bona fide public offering of the Bonds at a price not in excess of the initial offering price or prices or yields not less than the yields set forth on the inside cover page of the printed paper form of the Official Statement of the Issuer; provided, however, the Underwriters reserve the right to change such initial public offering prices as the Underwriters deem necessary or desirable, in their sole discretion, in connection with the marketing of the Bonds, and may offer and sell the Bonds to certain dealers, unit investment trusts and money market funds, certain of which may be sponsored or managed by one or more of the Underwriters at prices lower than the public offering prices or yields greater than the yields set forth therein. The Representative shall provide to the Issuer a certificate setting forth the offering prices of the Bonds in substantially the form set forth on Exhibit B. 2 Delivered to the Issuer herewith is a corporate check or checks payable to its order in the amount of $ for the Bonds (the "Good Faith Check "). If the Issuer does not accept this offer, the Issuer shall promptly return the Good Faith Check to the Representative. If it accepts this offer, the Issuer agrees to hold the Good Faith Check uncashed until the Closing (as defined herein). At the Closing and upon the delivery of the Bonds, the Issuer shall return the Good Faith Check to the Representative, and the Underwriters shall pay the Issuer the entire purchase price of the Bonds. If the Issuer fails to deliver the Bonds at the Closing, or if the Issuer shall be unable to satisfy the conditions to the obligations of the Underwriters set forth in this Purchase Agreement (unless waived by the Underwriters), or if the obligations of the Underwriters shall be terminated for any reason permitted by this Purchase Agreement, the Issuer shall promptly return the Good Faith Check to the Representative, and such return shall constitute a full release and discharge of all claims and rights hereunder of the Underwriters against the Issuer. If the Underwriters fail (other than for a reason permitted herein) to accept delivery of and to pay for the Bonds at the Closing as herein provided, the Issuer shall retain and cash the Good Faith Check as and for full liquidated damages for such failure and for any defaults hereunder on the part of the Underwriters and, except as set forth in this Section and Sections 5 and 10 hereof, neither party shall have any further rights against the other hereunder. No interest shall be paid by the Issuer upon the principal amount of the Good Faith Check. 4. Delivery of the Official Statement and Other Documents. (a) The Issuer has delivered or caused to be delivered to the Underwriters copies of the Preliminary Official Statement dated January , 2017, which, together with the cover page and appendices thereto, is herein referred to as the "Preliminary Official Statement." It is acknowledged by the Issuer that the Underwriters may deliver the Preliminary Official Statement and a final Official Statement (as hereinafter defined) electronically over the interne and in printed paper form. For purposes of this Purchase Agreement, the printed paper form of the Preliminary Official Statement and the Official Statement are deemed controlling. The Issuer deems the Preliminary Official Statement final as of its date and as of the date hereof for purposes of Rule 15c2 -12 promulgated under the Securities Exchange Act of 1934, as amended ( "Rule 15c2 -12 "), except for any information which is permitted to be omitted therefrom in accordance with paragraph (b)(1) thereof. (b) Within seven (7) business days from the date hereof, and in any event not later than two (2) business days before the Closing Date (as defined herein), the Issuer shall deliver to the Underwriters a final Official Statement relating to the Bonds dated the date hereof (such Official Statement, including the cover page, and all appendices attached thereto, together with all information previously permitted to have been omitted by Rule 15c2 -12 and any amendments or supplements and statements incorporated by reference therein or attached thereto, as have been approved by the Issuer, Bond Counsel, Disclosure Counsel and the Representative, is referred to herein as the "Official Statement ") and such additional conformed copies thereof as the Representative may reasonably request in sufficient quantities to comply with Rule 15c2 -12, rules of the Municipal Securities Rulemaking Board ( "MSRB ") and to meet potential customer requests for copies of the Official Statement. The Underwriters agree to file a copy of the Official Statement, including any amendments or supplements thereto prepared by the Issuer, with the MSRB on its Electronic Municipal Markets Access ( "EMMA ") system. The 3 Issuer shall execute the Official Statement by an authorized officer of the Issuer. The Official Statement shall be in substantially the same form as the Preliminary Official Statement and, other than information previously permitted to have been omitted by Rule 15c2 -12, the Issuer shall only make such other additions, deletions and revisions in the Official Statement which are approved by the Representative. The Underwriters hereby agree to cooperate and assist in the preparation of the Official Statement. The Issuer hereby agrees to deliver to the Underwriters an electronic copy of the Official Statement in a form that permits the Underwriters to satisfy their obligations under the rules and regulations of the MSRB and the U.S. Securities and Exchange Commission ( "SEC "). The Issuer hereby ratifies, confirms and approves the use and distribution by the Underwriters before the date hereof of the Preliminary Official Statement and hereby authorizes the Underwriters to use the Official Statement and the Bond Ordinance in connection with the public offering and sale of the Bonds. (c) In order to assist the Underwriters in complying with Rule 15c2 -12, the Issuer will undertake, pursuant to the Continuing Disclosure Certificate of the Issuer, dated as of the date of delivery of the Bonds (the "Disclosure Certificate "), to provide annual financial information and notices of the occurrence of specified events. A description of the Disclosure Certificate is set forth in, and a form of such agreement is attached as an appendix to, the Preliminary Official Statement and the Official Statement. 5. Representations. The Issuer represents to and agrees with the Underwriters that: (a) The Issuer is duly organized and validly existing, with full legal right, power and authority to issue, sell and deliver the Bonds to the Underwriters pursuant to the Act and the Bond Ordinance, and to execute, deliver and perform its obligations, as the case may be, under this Purchase Agreement, the Bond Ordinance, the Bonds, the Disclosure Certificate, the Escrow Deposit Agreement by and between the Issuer and U.S. Bank National Association dated as of the Closing Date and pertaining to the refunding of the Refunded Bonds (the "Escrow Agreement ") and the Paying Agent Agreement by and between the Issuer and U.S. Bank National Association as Registrar and Paying Agent for the Bonds dated as of the Closing Date (the "Paying Agent Agreement ") (collectively, the "Legal Documents ") and to perform and consummate all obligations and transactions required or contemplated by each of the Legal Documents and the Official Statement. (b) The Bond Ordinance approving and authorizing the execution and delivery by the Issuer of the Legal Documents was duly enacted at meetings of the City Council of the Issuer called and held pursuant to law and with all public notice required by law and at which quorums were present and acting throughout, and is in full force and effect and has not been amended or repealed. (c) The Bond Ordinance and the Bonds conform to the descriptions thereof contained in the Official Statement, and the Bonds, when duly issued and authenticated in accordance with the Bond Ordinance and delivered to the Underwriters as provided herein, will be validly issued and outstanding obligations of the Issuer, entitled to the benefits of the Bond Ordinance and payable from the sources therein specified. 4 (d) The Issuer has executed and delivered, or will execute and deliver on or before the Closing Date, each of the Legal Documents. Each of the Legal Documents constitutes, or will, as of the Closing Date, constitute, a legal, valid and binding obligation of the Issuer enforceable in accordance with its terms, subject to any applicable bankruptcy, insolvency or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. To the best knowledge of the Issuer, each of the Legal Documents has been executed and delivered, or will be executed and delivered on or before the Closing Date, by each respective signatory and is currently in full force and effect or, as of the Closing Date, will be in full force and effect. (e) Except as described in the Official Statement, the Issuer is not in any material respect in breach of or default under any constitutional provision, law or administrative regulation of the State or of the United States or any agency or instrumentality of either, or of any other governmental agency, or any Material Judgment or Agreement (as defined below), and no event has occurred and is continuing which with the passage of time or the giving of notice, or both, would constitute a default or event of default under any Material Judgment or Agreement; and the enactment of the Bond Ordinance, the issuance, delivery and sale of the Bonds and the execution and delivery of the Legal Documents and compliance with and performance of the Issuer's obligations therein and herein will not in any material respect conflict with, violate or result in a breach of or constitute a default under, any such constitutional provision, law, administrative regulation or any Material Judgment or Agreement, nor will any such execution, delivery, adoption or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the Issuer or under the terms of any such law, administrative regulation or Material Judgment or Agreement. As used herein, the term "Material Judgment or Agreement" means any judgment or decree or any loan agreement, indenture, bond, note or resolution or any material agreement or other instrument to which the Issuer is a party or to which the Issuer or any of its property or assets is otherwise subject (including, without limitation, the Act, the Bond Ordinance and the Legal Documents). (f) All approvals, consents and orders of any governmental authority, board, agency, council, commission or other body having jurisdiction which would constitute a condition precedent to the performance by the Issuer of its obligations hereunder and under the Legal Documents have been obtained; provided, that the Issuer makes no representations as to any approvals, consents or other actions which may be necessary to qualify the Bonds for offer and sale under Blue Sky or other state securities laws or regulations. (g) Any certificates executed by any officer of the Issuer and delivered to the Underwriters pursuant hereto or in connection herewith shall be deemed a representation and warranty of the Issuer as to the accuracy of the statements therein made. (h) Between the date hereof and the time of the Closing, the Issuer shall not, without the prior written consent of the Representative, offer or issue in any material amount any bonds, notes or other obligations for borrowed money, or incur any material liabilities, direct or contingent, except in the course of normal business operations of the Issuer or except for such borrowings as may be described in or contemplated by the Official Statement. 5 (i) The audited financial statements of the Issuer as of September 30, 2015, as well as any unaudited information as of September 30, 2016 provided by the Issuer for inclusion in the Official Statement, fairly represent the receipts, expenditures, assets, liabilities and cash balances of such amounts and, insofar as presented, other funds of the Issuer as of the dates and for the periods therein set forth. Except as disclosed in the Official Statement or otherwise disclosed in writing to the Underwriters, there has not been any materially adverse change in the financial condition of the Issuer or in its operations since September 30, 2015, and there has been no occurrence, circumstance or combination thereof which is reasonably expected to result in any such materially adverse change. (j) Except for information which is permitted to be omitted pursuant to Rule 15c2- 12(b)(1), the Preliminary Official Statement (excluding therefrom the information under the caption "DESCRIPTION OF THE SERIES 2017 BONDS — Book -Entry Only System" or information under the caption "UNDERWRITING" that has been provided by the Underwriters, as to each of which no representations or warranties are made), as of its date and as of the date hereof was and is true and correct in all material respects and did not and does not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (k) The Official Statement is, as of its date and at all times after the date of the Official Statement (excluding therefrom the information under the caption "DESCRIPTION OF THE SERIES 2017 BONDS — Book -Entry Only System" or information under the caption "UNDERWRITING" that has been provided by the Underwriters, as to each of which no representations or warranties are made) up to and including the Closing Date will be, true and correct in all material respects and will not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (1) If the Official Statement is supplemented or amended, at the time of each supplement or amendment thereto and (unless subsequently again supplemented or amended) at all times subsequent thereto up to and including the time of the Closing, the Official Statement as so supplemented or amended will be true and correct in all material respects and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. (m) If between the date hereof and the time of Closing, any event shall occur which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the Issuer shall notify the Representative thereof, and if, in the opinion of the Representative, such event requires the preparation and publication of a supplement or amendment to the Official Statement, the Issuer shall promptly (and in any event before the Closing) prepare and furnish (at the expense of the Issuer) a reasonable number of copies of an 6 amendment of or supplement to the Official Statement in form and substance satisfactory to the Representative. (n) Except as described in the Preliminary Official Statement, no litigation, proceeding or official investigation of any governmental or judicial body is pending against the Issuer or against any other party of which the Issuer has notice or, to the knowledge of the Issuer, threatened against the Issuer, (i) seeking to restrain or enjoin the issuance, sale or delivery of any of the Bonds, or the payment or collection of any amounts pledged or to be pledged to pay the principal of and interest on the Bonds, (ii) in any way contesting or affecting any authority for the issuance of the Bonds or the validity or binding effect of any of the Legal Documents, (iii) which is in any way contesting the creation, existence, powers or jurisdiction of the Issuer or the validity or effect of the Bond Ordinance or the Act or any provision thereof or the application of the proceeds of the Bonds, including, without limitation, the refunding of the Refunded Bonds, or (iv) which, if adversely determined, could materially adversely affect the financial position or operating condition of the Issuer or the transactions contemplated by the Official Statement or any of the Legal Documents. The Issuer shall advise the Representative promptly of the institution of any proceedings known to it by any governmental agency prohibiting or otherwise affecting the use of the Preliminary Official Statement or the Official Statement in connection with the offering, sale or distribution of the Bonds. (o) Except as described in the Preliminary Official Statement, during the last five years, the Issuer has not failed to materially comply with any previous undertaking relating to continuing disclosure of information pursuant to Rule 15c2 -12. (p) The Issuer has the authority to advance refund the Refunded Bonds as described in the Preliminary Official Statement. All representations, warranties and agreements of the Issuer shall remain operative and in full force and effect, regardless of any investigations made by any of the Underwriters or on the Underwriters' behalf, and shall survive the delivery of the Bonds. 6. Closing. At 10 A.M., Eastern Standard Time, on , 2017, or at such other time or date as the Representative and the Issuer may mutually agree upon as the date and time of the Closing (the "Closing Date "), the Issuer will deliver or cause to be delivered to the Underwriters, at the offices of Bryant Miller Olive P.A. ( "Bond Counsel "), or at such other place as the Representative and the Issuer may mutually agree upon, the Bonds, through the facilities of The Depository Trust Company, New York, New York ( "DTC "), duly executed and authenticated, and the other documents specified in Section 7 (the "Closing "). At the Closing, (a) upon satisfaction of the conditions herein specified, the Underwriters shall accept the delivery of the Bonds, and pay the purchase price therefor in federal funds payable to the account of the Issuer and (b) the Issuer shall deliver or cause to be delivered the Bonds to the Underwriters through the facilities of DTC in definitive or temporary form, duly executed by the Issuer and in the authorized denominations as specified by the Representative at the Closing, and the Issuer shall deliver the other documents hereinafter mentioned. The Bonds shall be made available to the Underwriters at least one (1) business day before the Closing Date for purposes of inspection. 7 7. Conditions Precedent. The Underwriters have entered into this Purchase Agreement in reliance upon the representations and agreements of the Issuer contained herein and the performance by the Issuer of its obligations hereunder, both as of the date hereof and as of the Closing Date. (a) The Underwriters' obligations under this Purchase Agreement are and shall be subject to the following further conditions: (i) The representations of the Issuer contained herein shall be true, complete and correct in all material respects on the date of acceptance hereof and on and as of the Closing Date. (ii) At the time of the Closing, the Official Statement, the Bond Ordinance and the Legal Documents shall be in full force and effect and shall not have been amended, modified or supplemented except as may have been agreed to in writing by the Representative. (iii) The Issuer shall perform or have performed all of its obligations required under or specified in the Bond Ordinance, the Legal Documents and the Official Statement to be performed at or prior to the Closing. (iv) The Issuer shall have delivered to the Underwriters final Official Statements by the time, and in the numbers, required by Section 4 of this Purchase Agreement. (v) As of the date hereof and at the time of Closing, all necessary official action of the Issuer relating to the Legal Documents and the Official Statement shall have been taken and shall be in full force and effect and shall not have been amended, modified or supplemented in any material respect. (vi) After the date hereof, up to and including the time of the Closing, there shall not have occurred any change in or particularly affecting the Issuer, the Act, the Bond Ordinance, the Legal Documents, the System or the Net Revenues as the foregoing matters are described in the Official Statement, which in the reasonable professional judgment of the Representative materially impairs the investment quality of the Bonds. (vii) At or prior to the Closing, the Representative shall receive the following documents (in each case with only such changes as the Representative shall approve): (1) The approving opinion of Bond Counsel relating to the Bonds, dated the Closing Date, substantially in the form attached as Appendix E to the Official Statement, and a reliance letter with respect thereto addressed to the Underwriters; (2) The supplemental opinion of Bond Counsel, addressed to the Underwriters, dated the Closing Date, to the effect that: (A) This Purchase Agreement has been duly executed and delivered by the Issuer and is a legal, valid and binding obligation of the Issuer 8 enforceable in accordance with its terms, subject to laws relating to bankruptcy, insolvency, reorganization or creditors' rights generally, to the application of equitable principles, the exercise of judicial discretion and the limitations on legal remedies against public entities in the State of Florida; (B) The statements contained in the Official Statement on the cover page and in the sections entitled "INTRODUCTION," "DESCRIPTION OF THE SERIES 2017 BONDS" (other than the information concerning DTC and its book -entry system), "SECURITY FOR THE SERIES 2017 BONDS," and "SUMMARY OF 2014 AMENDING ORDINANCE," insofar as such statements expressly summarize certain provisions of the Bond Ordinance and the Bonds, are accurate summaries of the provisions purported to be summarized, and the form and content of such counsel's opinion attached as Appendix E to the Official Statement and the statements under the section "TAX MATTERS" are accurate; and (C) The Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended (the "1933 Act ") and the Bond Ordinance is exempt from qualification pursuant to the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act "); (3) An opinion of Bond Counsel, dated the Closing Date and addressed to the Issuer and the Underwriters, in such form as is acceptable to the Issuer and the Representative, to the effect that the Refunded Bonds have been legally defeased and are no longer outstanding under the Bond Ordinance; (4) Underwriters, effect that: (A) An opinion, dated the Closing Date and addressed to the from Nabors Giblin & Nickerson, P.A., Disclosure Counsel, to the Based upon the information made available to them in the course of their participation in the preparation of the Official Statement and without passing on and without assuming any responsibility for the accuracy, completeness and fairness of the statements in the Official Statement, and having made no independent investigation or verification thereof, nothing has come to their attention which would lead them to believe that the Official Statement as of its date and as of the Closing Date (excluding therefrom any information in the Official Statement relating to DTC, the operation of its book - entry system or any other financial or statistical data or projections or estimates or expressions of opinion included in the Official Statement and the appendices thereto, as to which no opinion need be expressed) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements 9 (5) Issuer, dated effect that: (A) (B) (C) (D) (E) therein, in the light of the circumstances under which they were made, not misleading in any material respect; The opinion of Pamela K. Akin, Esq., the City Attorney of the the date of the Closing and addressed to the Underwriters, to the The Issuer has been duly organized and is validly existing under the Constitution and laws of the State of Florida, and has all requisite power and authority thereunder: (a) to adopt the Bond Ordinance, and to enter into, execute, deliver and perform its covenants and agreements under the Legal Documents; (b) to approve and authorize the use, execution and distribution of the Preliminary Official Statement and the Official Statement; (c) to issue, sell, execute and deliver the Bonds; (d) to pledge the Net Revenues as contemplated by the Legal Documents; and (e) to carry on its activities as currently conducted; The Issuer has taken all actions required to be taken by it before the Closing Date material to the transactions contemplated by the documents mentioned in paragraph (a) above, and the Issuer has duly authorized the execution and delivery of, and the due performance of its obligations under, the Legal Documents; The Bond Ordinance was duly enacted by the City Council of the Issuer at meetings of the governing body of the Issuer which were called and held pursuant to law and with all required notices and in accordance with all applicable open meetings laws and at which quorums were present and acting at the time of the enactment of the Bond Ordinance; The enactment of the Bond Ordinance, the execution and delivery by the Issuer of the Legal Documents and the compliance with the provisions of the Legal Documents, do not and will not conflict with or violate in any material respect any Florida constitutional, statutory or regulatory provision, or, to the best of such counsel's knowledge after due inquiry, conflict with or constitute on the part of the Issuer a material breach of or default under any agreement or instrument to which the Issuer is a party or by which it is bound; The Legal Documents have been duly authorized and executed by the Issuer, are in full force and effect and constitute legal, valid and binding obligations of the Issuer and are enforceable according to the terms thereof, except as enforcement thereof may be limited by bankruptcy, insolvency or other laws affecting enforcement of creditors' rights generally, and by the application of equitable principles if equitable remedies are sought, by the exercise of 10 judicial discretion and the limitations on legal remedies against public entities in the State; (F) No litigation is pending or, to the best of such counsel's knowledge after due inquiry, threatened against the Issuer in any court in any way affecting the titles of the officials of the Issuer to their respective positions, or seeking to restrain or to enjoin the issuance, sale or delivery of the Bonds, or the collection of revenues pledged or to be pledged to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bond Ordinance or the Legal Documents, or contesting in any way the completeness or accuracy of the Official Statement, or contesting the powers of the Issuer or its authority with respect to the Bond Ordinance or the Legal Documents; (G) The information contained in the Official Statement under the captions "INTRODUCTION" pertaining to the Issuer and "LITIGATION" does not contain any untrue statement of a material fact and does not omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (H) To the best of such counsel's knowledge after due inquiry, no authorization, approval, consent or other order of the State or any local agency of the State, other than such authorizations, approvals and consents which have been obtained, is required for the valid authorization, execution and delivery by the Issuer of the Legal Documents and the authorization and distribution of the Preliminary Official Statement and the Official Statement (provided that no opinion need be expressed as to any action required under state securities or Blue Sky laws in connection with the purchase of the Bonds by the Underwriters); and (I) To the best of such counsel's knowledge after due inquiry, the Issuer is not in breach of or default under any applicable law or administrative regulation of the State or any applicable judgment or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which the Issuer is a party or is otherwise subject, which breach or default would materially adversely affect the Issuer's ability to enter into or perform its obligations under the Legal Documents, and no event has occurred and is continuing which, with the passage of time or the giving of notice, or both, would constitute a default or an event of default under any such instrument and which would materially adversely 11 affect the Issuer's ability to enter into or perform its obligations under the Legal Documents; (6) The opinion of GrayRobinson, P.A., counsel to the Underwriters, dated the date of the Closing and addressed to the Underwriters, and covering such matters as the Representative may reasonably request; (7) A certificate, dated the Closing Date, signed by the Mayor, the City Manager and the City Clerk of the Issuer to the effect that: (a) the representations and agreements of the Issuer contained herein are true and correct in all material respects as of the Closing Date; (b) the Legal Documents have been duly executed on behalf of the Issuer by representatives of the Issuer named therein; (c) except as described in the Official Statement, no litigation is pending or, to his or her knowledge, threatened (i) seeking to restrain or enjoin the issuance or delivery of any of the Bonds, (ii) in any way contesting or affecting any authority for the issuance of the Bonds or the validity of the Bonds, the Bond Ordinance or any Legal Document, (iii) in any way contesting the creation, existence or powers of the Issuer or the validity or effect of the Act or any provision thereof or the application of the proceeds of the Bonds, including without limitation the refunding of the Refunded Bonds, or (iv) which, if adversely determined, could materially adversely affect the financial position or operating condition of the Issuer or the transactions contemplated by the Official Statement or any Legal Document; and (d) the Official Statement is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except no review has been made of information in the Official Statement under the caption "DESCRIPTION OF THE SERIES 2017 BONDS — Book-Entry Only System" or under the caption "UNDERWRITING" that has been provided by the Underwriters; (8) A certificate, dated the Closing Date, signed by the Financial Director of the Issuer, in form and substance satisfactory to the Representative, to the effect that (i) the financial statements of the Issuer as of September 30, 2015, as well as any unaudited information as of September 30, 2016 provided by the Issuer for inclusion in the Official Statement, fairly represent the receipts, expenditures, assets, liabilities and cash balances of such amounts and, insofar as presented, other funds of the Issuer as of the dates and for the periods therein set forth and (ii) except as disclosed in the Official Statement, since September 30, 2015, no materially adverse change has occurred, or any development involving a prospective material change, in the financial position or results of operations of the Issuer, and the Issuer has not incurred since September 30, 2015, any material liabilities other than in the ordinary course of business or as set forth in or contemplated by the Official Statement; (9) Certified copies of the Bond Ordinance; 12 (10) Executed or certified copies of each other Legal Document; (11) A Tax Certificate of the Issuer, in form satisfactory to Bond Counsel, executed by such officials of the Issuer as shall be satisfactory to the Representative; (12) Evidence satisfactory to the Representative of the assignment of long -term ratings to the Bonds by S &P Global Ratings and Moody's Investors Service not lower than " " and " ," respectively; (13) The verification report of Causey Demgen & Moore P.C. with respect to the Refunded Bonds, in form and substance satisfactory to the Underwriters; (14) Copies of the "City of Clearwater FY 2016 Water & Sewer Revenue Sufficiency Analysis" dated July 21, 2016, prepared by Burton & Associates (the "Rate Study "); (15) A certificate of an authorized officer of Burton & Associates, dated as of the Closing Date, to the effect that (i) Burton & Associates consents to the inclusion of the Rate Study in the Preliminary Official Statement and the Official Statement and to the references to Burton & Associates therein, (ii) to the best of our knowledge, there has been no change which would materially adversely affect the assumptions made or the conclusions reached in the Rate Study, and the considerations and assumptions used in compiling the Rate Study were reasonable, and (iii) the information set forth in the Preliminary Official Statement and the Official Statement under the caption "THE WATER AND SEWER SYSTEM" provided by Burton & Associates and in "APPENDIX F: FISCAL YEAR 2016 WATER AND SEWER REVENUE SUFFICIENCY ANALYSIS (RATE STUDY)" [and "APPENDIX G: SCHEDULE OF RATES, FEES AND CHARGES "] did not as of the respective dates of the Preliminary Official Statement and the Official Statement, and does not as of the Closing Date, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (16) A certificate of an authorized officer of U.S. Bank National Association (the "Bank "), as escrow agent, paying agent and registrar, dated as of the Closing Date, to the effect that: (a) the Bank is a national banking association organized and existing under and by virtue of the laws of the United States, having the full power and being qualified to enter into and perform its duties under the Escrow Agreement and the Paying Agent Agreement; (b) the Bank is duly authorized to enter into the Escrow Agreement and the Paying Agent Agreement; (c) when delivered to and paid for by the Underwriters at the Closing, the Bonds will have been duly authenticated in accordance with the terms of the Bond Ordinance; (d) the execution and delivery of the Escrow Agreement and the Paying Agent Agreement, and compliance with the provisions on the Bank's part 13 contained therein, will not conflict with or constitute a breach of or default under any law, administrative regulation, judgment, decree, loan agreement, indenture, note, resolution, agreement or other instrument to which the Bank is a party or is otherwise subject (except that no representation, warranty or agreement is made with respect to any federal or state securities or blue sky laws or regulations), which conflict, breach or default would materially impair the ability of the Bank to perform its obligations under the Escrow Agreement or the Paying Agent Agreement, nor will any such execution, delivery, adoption or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the properties or assets held by the Bank pursuant to the Escrow Agreement or the Paying Agent Agreement under the terms of any such law, administrative regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or other instrument, except as provided by the Bond Ordinance, the Escrow Agreement or the Paying Agent Agreement; and (e) to the best of the knowledge of the Bank, it has not been served with any action, suit, proceeding, inquiry or investigation in law or in equity, before or by any court, governmental agency, public board or body, nor is any such action or other proceeding threatened against the Bank, affecting the existence of the Bank, or the titles of its officers to their respective offices or seeking to prohibit, restrain, or enjoining the execution and delivery of the Bonds or the collection of revenues to be applied to pay the principal, premium, if any, and interest with respect to the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Escrow Agreement or the Paying Agent Agreement, or contesting the powers of the Bank or its authority to enter into, adopt or perform its obligations under any of the foregoing to which it is a party, wherein an unfavorable decision, ruling or funding would materially adversely affect the validity or enforceability of the Escrow Agreement or the Paying Agent Agreement or the power and authority of the Bank to enter into and perform its duties thereunder; (17) Evidence that a Form 8038 -G relating to the Bonds has been executed by the Issuer and will be filed with the Internal Revenue Service (the "IRS ") within the applicable time limit: (18) A copy of the Blue Sky Survey with respect to the Bonds; (19) A copy of the Issuer's executed Blanket Letter of Representation to The Depository Trust Company; and (20) Such additional legal opinions, certificates, proceedings, instruments and other documents as the Representative, counsel for the Underwriters or Bond Counsel may reasonably request to evidence compliance by the Issuer with legal requirements, the truth and accuracy, as of the time of Closing, of the representations of the Issuer herein contained and the due performance or satisfaction by the Issuer at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by the Issuer and all 14 conditions precedent to the issuance of additional Bonds pursuant to the Bond Ordinance shall have been fulfilled. 8. Termination. If the Issuer shall be unable to satisfy the conditions to the Underwriters' obligations contained in this Purchase Agreement, or if the Underwriters' obligations shall be terminated for any reason permitted by this Purchase Agreement, this Purchase Agreement may be cancelled by the Representative at, or at any time before, the time of the Closing. Notice of such cancellation shall be given by the Representative to the Issuer in writing, or by telephone confirmed in writing. The performance by the Issuer of any and all conditions contained in this Purchase Agreement for the benefit of the Underwriters may be waived by the Representative. (a) The Underwriters shall also have the right, before the time of Closing, to cancel their obligations to purchase the Bonds, by written notice by the Representative to the Issuer, if between the date hereof and the time of Closing: (i) Any event or circumstance occurs or information becomes known, which, in the professional judgment of the Representative, makes untrue any statement of a material fact set forth in the Official Statement or results in an omission to state a material fact necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading; or (ii) The market for the Bonds or the market prices of the Bonds or the ability of the Underwriters to enforce contracts for the sale of the Bonds shall have been materially and adversely affected, in the professional judgment of the Representative, by: (1) An amendment to the Constitution of the United States or the State of Florida shall have been passed or legislation shall have been introduced in or enacted by the Congress of the United States or the legislature of any state having jurisdiction of the subject matter or legislation pending in the Congress of the United States shall have been amended or legislation shall have been recommended to the Congress of the United States or to any state having jurisdiction of the subject matter or otherwise endorsed for passage (by press release, other form of notice or otherwise) by the President of the United States, the Treasury Department of the United States, the Internal Revenue Service or the Chairman or ranking minority member of the Committee on Finance of the United States Senate or the Committee on Ways and Means of the United States House of Representatives, or legislation shall have been proposed for consideration by either such Committee by any member thereof or presented as an option for consideration by either such Committee by the staff of such Committee or by the staff of the joint Committee on Taxation of the Congress of the United States, or legislation shall have been favorably reported for passage to either House of the Congress of the United States by a Committee of such House to which such legislation has been referred for consideration, or a decision shall have been rendered by a court of the United States or of the State of Florida or the Tax Court of the United States, or a ruling shall have been made or a regulation or temporary regulation shall have been proposed or made or any other release or 15 announcement shall have been made by the Treasury Department of the United States, the Internal Revenue Service or other federal or State of Florida authority, with respect to federal or State of Florida taxation upon revenues or other income of the general character to be derived by the Issuer or upon interest received on obligations of the general character of the Bonds which, in the judgment of the Representative, may have the purpose or effect, directly or indirectly, of affecting the tax status of the Issuer, its property or income, its securities (including the Bonds) or the interest thereon, or any tax exemption granted or authorized by federal or State of Florida legislation; or (2) The declaration of war or engagement in or escalation of military hostilities by the United States or the occurrence of any other national emergency or calamity or terrorism affecting the operation of the government of, or the financial community in, the United States; or (3) The declaration of a general banking moratorium by federal, New York or Florida authorities; or (4) The occurrence of a major financial crisis, a material disruption in commercial banking or securities settlement or clearance services, or a material disruption or deterioration in the fixed income or municipal securities market; or (5) Additional material restrictions not in force or being enforced as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange; or (6) The general suspension of trading on any national securities exchange; or (iii) Legislation enacted, introduced in the Congress or recommended for passage by the President of the United States, or a decision rendered by a court established under Article III of the Constitution of the United States or by the Tax Court of the United States, or an order, ruling, regulation (final, temporary or proposed) or official statement issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter shall have been made or issued to the effect that the Bonds, other securities of the Issuer or obligations of the general character of the Bonds are not exempt from registration under the 1933 Act, or that the Bond Ordinance is not exempt from qualification under the Trust Indenture Act; or (iv) Any change in or particularly affecting the Issuer, the Act, the Bond Ordinance, the Legal Documents or the Net Revenues as the foregoing matters are described in the Official Statement, which in the professional judgment of the Representative materially impairs the investment quality of the Bonds; or (v) An order, decree or injunction of any court of competent jurisdiction, issued or made to the effect that the issuance, offering or sale of obligations of the general character of the Bonds, or the issuance, offering or sale of the Bonds, including any or all 16 underlying obligations, as contemplated hereby or by the Preliminary Official Statement or the Official Statement, is or would be in violation of any applicable law, rule or regulation, including (without limitation) any provision of applicable federal securities laws as amended and then in effect; or (vi) A stop order, ruling, regulation or official statement by the SEC or any other governmental agency having jurisdiction of the subject matter shall have been issued or made or any other event occurs, the effect of which is that the issuance, offering or sale of the Bonds, or the execution and delivery of any Legal Documents, as contemplated hereby or by the Preliminary Official Statement or the Official Statement, is or would be in violation of any applicable law, rule or regulation, including (without limitation) any provision of applicable federal securities laws, including the 1933 Act, the Securities Exchange Act of 1934 or the Trust Indenture Act, each as amended and as then in effect; or (vii) Any litigation shall be instituted or be pending at the time of the Closing to restrain or enjoin the issuance, sale or delivery of the Bonds, or in any way contesting or affecting any authority for or the validity of the proceedings authorizing and approving the Act, the Bond Ordinance, the Legal Documents or the existence or powers of the Issuer with respect to its obligations under the Legal Documents; or (viii) A reduction or withdrawal in any of the following assigned ratings, or, as of the Closing Date, the failure by any of the following rating agencies to assign the following ratings, to the Bonds: long -term ratings by S &P Global Ratings and Moody's Investors Service not lower than "" and "," respectively. 9. Amendments to Official Statement. During the period commencing on the Closing Date and ending twenty -five (25) days from the end of the underwriting period, the Issuer shall advise the Representative if any event relating to or affecting the Official Statement shall occur as a result of which it may be necessary or appropriate to amend or supplement the Official Statement in order to make the Official Statement not misleading in light of the circumstances existing at the time it is delivered to a purchaser or "potential customer" (as defined for purposes of Rule 15c2 -12). If any such event occurs and in the reasonable judgment of the Representative and the Issuer, an amendment or supplement to the Official Statement is appropriate, the Issuer shall, at its expense, forthwith prepare and furnish to the Underwriters a reasonable number of copies of an amendment of or supplement to the Official Statement (in form and substance satisfactory to counsel for the Underwriters) that will amend or supplement the Official Statement so that it will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser or "potential customer," not misleading. 10. Expenses. All expenses and costs of the Issuer incident to the performance of its obligations in connection with the authorization, issuance and sale of the Bonds to the Underwriters, including the costs of printing or reproduction of the Bonds, the Legal Documents and the Official Statement in reasonable quantities, fees of consultants, fees of rating agencies, advertising expenses, fees and expenses of the Bank pursuant to the Escrow Agreement and the Paying Agent Agreement, and fees and expenses of counsel to the Issuer, Bond Counsel and 17 Disclosure Counsel, shall be paid by the Issuer from the proceeds of the Bonds or other revenues of the Issuer. The Issuer shall be solely responsible for and shall pay for any expenses incurred by the Underwriters on behalf of the Issuer's employees and representatives which are incidental to implementing this Purchase Agreement, including, but not limited to, meals, transportation, lodging, and entertainment of those employees and representatives. All expenses and costs of the Underwriters incurred under or pursuant to this Purchase Agreement, including, without limitation, the cost of preparing this Purchase Agreement and other Underwriter documents, travel expenses, continuing disclosure compliance review fees and the fees and expenses of counsel to the Underwriters, shall be paid by the Underwriters (which may be included as an expense component of the Underwriters' discount). 11. Use of Documents. The Issuer hereby authorizes the Underwriters to use, in connection with the public offering and sale of the Bonds, this Purchase Agreement, the Preliminary Official Statement, the Official Statement and the Legal Documents, and the information contained herein and therein. 12. Qualification of Securities. The Issuer will furnish such information, execute such instruments and take such other action in cooperation with the Underwriters as the Representative may reasonably request to qualify the Bonds for offer and sale under the Blue Sky or other securities laws and regulations of such states and other jurisdictions of the United States as the Representative may designate and to provide for the continuance of such qualification; provided, however, that the Issuer will not be required to qualify as a foreign corporation or to file any general or special consents to service of process under the laws of any state. 13. Notices. Any notice or other communication to be given to the Issuer under this Purchase Agreement may be given by delivering the same in writing to: 100 S. Myrtle Avenue, 3rd Floor, Clearwater, Florida 33756, Attn: Finance Director, and any such notice or other communication to be given to the Underwriter may be given by delivering the same in writing to: 250 S. Park Avenue, Suite 400, Winter Park, Florida 32789, Attn: Coleman Cordell, Managing Director. 14. Benefit. This Purchase Agreement is made solely for the benefit of the Issuer and the Underwriters (including their successors or assigns) and no other person, partnership, association or corporation shall acquire or have any right hereunder or by virtue hereof. Except as otherwise expressly provided herein, all of the agreements and representations of the Issuer contained in this Purchase Agreement and in any certificates delivered pursuant hereto shall remain operative and in full force and effect regardless of: (i) any investigation made by or on behalf of the Underwriters; (ii) delivery of and payment for the Bonds hereunder; or (iii) any termination of this Purchase Agreement, other than pursuant to Section 8. 15. Attorneys' Fees. In the event of a dispute arising under this Purchase Agreement, the prevailing party shall have the right to collect from the other party its reasonable costs and necessary disbursements and attorneys' fees incurred in enforcing this Purchase Agreement. 16. Governing Law. THIS PURCHASE AGREEMENT SHALL BE DEEMED TO BE A CONTRACT UNDER, AND FOR ALL PURPOSES SHALL BE GOVERNED BY, AND 18 CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CHOICE OF LAW RULES (OTHER THAN NEW YORK GENERAL OBLIGATIONS LAWS SECTION 5 -1401 AND 5- 1402); PROVIDED, HOWEVER, THAT THE OBLIGATION OF THE ISSUER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA. 17. Counterparts. This Purchase Agreement may be executed in several counterparts, each of which shall be deemed an original hereof. [Signature Pages Follow] 19 Very truly yours, By: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as Representative By: Coleman Cordell, Managing Director Approved and Agreed to: , 2017 CITY OF CLEARWATER, FLORIDA By: George N. Cretekos, Mayor By: William B. Horne, II, City Manager [SIGNATURE PAGE TO PURCHASE AGREEMENT] SCHEDULE I Principal Amounts, Interest Rates and Prices [To Come] Optional and Mandatory Redemption Optional Redemption. The Bonds maturing on December 1, 20 and thereafter will be subject to optional redemption prior to their respective maturity dates beginning on December 1, 20, at 100% of the par value thereof Mandatory Redemption. The Bonds maturing on December 1, 20 will be subject to mandatory redemption prior to maturity, selected by lot, or in such manner as the Registrar may deem appropriate, at a redemption price equal to par plus accrued interest to the redemption date, on December 1, 20_ and each December 1 thereafter, from amounts deposited in the Redemption Account in the Bond Service Fund established by the Bond Ordinance, in the following years and amounts as follows: Year Amount * * Maturity EXHIBIT A DISCLOSURE STATEMENT CITY OF CLEARWATER, FLORIDA WATER AND SEWER REVENUE REFUNDING BONDS, SERIES 2017 City Council of City of Clearwater Clearwater, Florida Ladies and Gentlemen: , 2017 In connection with the proposed issuance by City of Clearwater, Florida (the "Issuer ") of the issue of bonds referred to above (the "Bonds "), Merrill Lynch, Pierce, Fenner & Smith Incorporated, as representative (the "Representative "), on behalf of itself and RBC Capital Markets, LLC and Wells Fargo Bank, National Association (collectively, the "Underwriters "), has agreed to underwrite a public offering of the Bonds. Arrangements for underwriting the Bonds will include a Bond Purchase Agreement dated the date hereof between the Issuer and the Underwriters (the "Purchase Contract "). Capitalized terms used but not defined herein shall have the meanings assigned to them in the Purchase Contract. The purpose of this letter is to furnish, pursuant to the provisions of Sections 218.385(2), (3) and (6), Florida Statutes, certain information in respect to the arrangement contemplated for the underwriting of the Bonds as follows: (a) The nature and estimated amount of expenses to be incurred by the Underwriters in connection with the issuance of the Bonds are set forth on Schedule A -I attached hereto. (b) There are no "finders," as that term is defined in Section 218.386, Florida Statutes, connected with the issuance of the Bonds. (c) The amount of underwriting spread, including the management fee, expected to be realized is as follows: Per $1,000 Dollar Amount Average Takedown $ $ Underwriters' Expenses Management Fee Total Underwriting Spread $ $ No other fee, bonus or other compensation is estimated to be paid by the Underwriters in connection with the issuance of the Bonds to any person not regularly employed or retained by the Underwriters, except as described in Schedule A -I attached hereto. (e) The name and address of the Representative are set forth below: Merrill Lynch, Pierce, Fenner & Smith Incorporated 250 S. Park Avenue, Suite 400 Winter Park, Florida 32789 (f) The Issuer is proposing to issue $ of its Water and Sewer Revenue Refunding Bonds, Series 2017, for the purposes of, together with other legally available funds of the Issuer, (i) advance refunding all or a portion of the Issuer's outstanding Water and Sewer Revenue Bonds, Series 2009A (the "Series 2009A Bonds ") and Water and Sewer Revenue Refunding Bonds, Series 2011 (the "Series 2011 Bonds," the refunded portion thereof, collectively with the refunded portion of the Series 2009A Bonds, being referred to herein as the "Refunded Bonds ") and (ii) paying certain costs of issuance associated with the Bonds. The Bonds are expected to be repaid over a period of approximately years (from the Closing Date). At a true interest cost rate of approximately %, total interest paid over the life of the Bonds will be $ The payment of the principal of, premium, if any, and interest on the Bonds shall be secured forthwith equally and ratably by a pledge of and lien upon the Net Revenues of the System. Authorizing the Bonds will result in an average of $ of Net Revenues not being available to finance the other services of the Issuer each year for approximately years. We understand that the Issuer does not require any further disclosure from the Underwriters, pursuant to Sections 218.385(2), (3) and (6), Florida Statutes. Very truly yours, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as Representative By: Coleman Cordell, Managing Director SCHEDULE A -1 [ To come ] EXHIBIT B ISSUE PRICE CERTIFICATE OF THE UNDERWRITER This Certificate is furnished by Merrill Lynch, Pierce, Fenner & Smith Incorporated as representative of the underwriters (the "Underwriter ") in connection with the sale and issuance by the City of Clearwater, Florida (the "Issuer ") of its $ aggregate principal amount of its City of Clearwater, Florida Water and Sewer Revenue Refunding Bonds, Series 2017 (the "Bonds ") issued , 2017, and the Underwriter hereby certifies and represents the following, based upon information available to us: 1. Based on our assessment of the then prevailing market conditions, the Underwriter reasonably expected when it agreed to purchase the Bonds (the "Sale Date ") that the first prices at which at least 10% of each maturity of the Bonds would be sold by the Underwriter to the general public (excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters or wholesalers) (the "Public ") would be prices not higher than, or, in the case of obligations sold on a yield basis, at yields not lower than, those listed for each maturity on Schedule A hereto (the "Initial Offering Prices "). 2. All of the Bonds have actually been offered to the Public in a bona fide public offering at prices not higher than, or, in the case of obligations sold on a yield basis, at yields not lower than, the Initial Offering Prices. 3. The first price, or yield in the case of obligations sold on a yield basis, at which ten percent (10 %) of each maturity of the Bonds has been sold to the Public was at a price not higher than, or, in the case of obligations sold on a yield basis, at a yield not lower than, the Initial Offering Prices [except for the Bonds with the following maturities:]. 4. The Underwriter had no reason to believe that any of the Initial Offering Prices of the Bonds exceeded the expected fair market value of the Bonds as of the Sale Date. We understand that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Tax Certificate and by Bryant Miller Olive P.A., in connection with rendering its opinion to the Issuer that the interest on the Bonds is not includable in gross income of the owners thereof for federal income tax purposes. The undersigned is certifying only as to facts in existence on the date hereof. Nothing herein represents the undersigned's interpretation of any laws; in particular the regulations under the Internal Revenue Code of 1986, or the application of any laws to these facts. The certifications contained herein are not necessarily based on personal knowledge, but may instead be based on either inquiry deemed adequate by the undersigned or institutional knowledge (or both) regarding the matters set forth herein. Although certain information furnished in this Certificate has been derived from other purchasers, bond houses and brokers and cannot be independently verified by us, we have no reason to believe it to be untrue in any material respect. [Signature Page Follows] B -1 Dated: MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as Representative of the Underwriters By: Coleman Cordell, Managing Director EXHIBIT C FORM OF REGISTRAR AND PAYING AGENT AGREEMENT Resolution No. 17 -02 REGISTRAR AND PAYING AGENT AGREEMENT THIS AGREEMENT is entered into as of , 2017 (the "Agreement "), by and between the City of Clearwater, Florida (the "Issuer ") and U.S. Bank National Association (the "Bank ") a national banking association duly organized and operating under the laws of the United States of America. WHEREAS, the Issuer has duly authorized and provided for the issuance of its $ Water and Sewer Revenue Refunding Bonds, Series 2017, dated , 2017 (the "Series 2017 Bonds "); to be issued in fully registered form only as to the payment of principal and interest thereon; and WHEREAS, the Bonds are scheduled to be delivered to the initial purchasers thereof on or about , 2017; and WHEREAS, the Issuer has selected the Bank to serve as Paying Agent in connection with the payment of the principal of, premium, if any, and interest on the Bonds and as Registrar with respect to the registration, transfer, and exchange thereof by the registered owners thereof; and WHEREAS, the Bank has agreed to serve in such capacities for and on behalf of the Issuer and has full power and authority to perform and serve as Registrar and Paying Agent for the Bonds; NOW, THEREFORE, it is mutually agreed as follows: ARTICLE ONE APPOINTMENT OF BANK AS REGISTRAR AND PAYING AGENT SECTION 1.01. APPOINTMENT. The Issuer hereby appoints the Bank to serve as Paying Agent with respect to the Bonds. As Paying Agent for the Bonds, the Bank shall be responsible for paying on behalf of the Issuer the principal, premium (if any), and interest on the Bonds as the same become due and payable to the registered owners thereof, all in accordance with this Agreement and the "Bond Ordinance" (hereinafter defined). The Issuer hereby appoints the Bank as Registrar with respect to the Bonds. As Registrar for the Bonds, the Bank shall keep and maintain for and on behalf of the Issuer books and records as to the ownership of said Bonds and with respect to the transfer and exchange thereof as provided herein and in the Bond Ordinance, a copy of which books and records shall be maintained at the designated office of the Bank located in the State of Florida or shall be available to be accessed from such office located in the State of Florida The Bank hereby accepts its appointment, and agrees to serve as the Paying Agent and Registrar for the Bonds. SECTION 1.02. COMPENSATION. As compensation for the Bank's services as Paying Agent and Registrar, the Issuer hereby agrees to pay the Bank a one -time upfront payment in an amount equal to $2,500.00, being full payment for services rendered and costs incurred by the Paying Agent under this Agreement for the term hereof and the Escrow Holder under the Escrow Deposit Agreement, on the date of issuance of the Bonds. ARTICLE TWO DEFINITIONS SECTION 2.01. DEFINITIONS: For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: "Bank Office" means the office of the Bank as follows: 225 E. Robinson Street, Suite 250, Orlando, Florida 32801. The Bank will notify the Issuer in writing of any change in location of the Bank Office. "Bond Ordinance" means Ordinance No. 3674 -84 enacted by the Issuer on August 2,1984, as amended and supplemented by Ordinance 6915 -01, enacted November 15, 2001, as amended by Ordinance No. 8620 -14, enacted by the Issuer on December 4, 2014, and as further supplemented by Resolution No. 17 adopted on 2017. "Collected Funds" Funds immediately available to the Paying Agent as of the due date of such funds. "Date of Issue" means , 2017. "Delivery Date" means , 2017. "Depositories" means " DTC" "Fiscal Year" means, with respect to the Issuer, the year ending September 30. "Holder" and "Security Holder" each means the Person in whose name a Security is registered in the Security Register. "Issuer Request" and "Issuer Order" means a written request or order signed in the name of the Issuer by the Treasurer or his or her designee. 2 "Legal Holiday" means a day on which the Bank is required or authorized to be closed. "Payment Dates" means June 1 and December 1, commencing June 1, 2017. "Person" means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision of a government. "Predecessor Bonds" of any particular Security means every previous Security evidencing all or a portion of the same obligation as that evidenced by such particular Security (and, for the purposes of this definition, any mutilated, lost, destroyed, or stolen Security for which a replacement Security has been registered and delivered in lieu thereof pursuant to Section 4.05 hereof and the Bond Ordinance). "Record Date" means each May 15 and November 15 whether or not a business day. "Redemption Date" when used with respect to any Security to be redeemed means the date fixed for such redemption pursuant to the terms of the Bond Ordinance. "Responsible Officer" when used with respect to the Bank means the Chairman or Vice - Chairman of the Board of Directors, the Chairman or Vice - chairman of the Executive Committee of the Board of Directors, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust Officer, or any other officer of the Bank customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject. "Security" means any one of the individual Bonds of the Issuer's $ Water and Sewer Revenue Refunding Bonds, Series 2017, dated , 2017. "Security Register" means a register maintained by the Bank on behalf of the Issuer providing for the registration and transfer of the Bonds. "Stated Maturity" means the date specified in the particular Security upon which the principal of a Security is scheduled to be due and payable. SECTION 2.02. OTHER DEFINITIONS. The terms "Bank," "Issuer," and "Bonds (Security)" have the meanings assigned to them in the recital paragraphs of this Agreement. 3 The terms "Registrar" and "Paying Agent" refers to the Bank in the performance of the duties and functions of this Agreement. ARTICLE THREE PAYING AGENT SECTION 3.01. DUTIES OF PAYING AGENT. (a) As Paying Agent, the Bank shall, provided adequate Collected Funds have been provided to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the principal of each Security at its Stated Maturity or Redemption Date to the Holder upon surrender of the Security to the Bank at its corporate trust operations office located in Orlando, Florida. (b) As Paying Agent, the Bank shall, provided adequate Collected Funds have been provided to it for such purpose by or on behalf of the Issuer, pay on behalf of the Issuer the interest on each Security when due, by computing the amount of interest to be paid each Holder and preparing and sending checks by United States Mail, first class, postage prepaid, on each payment date, to the Holders of the Bonds (or their Predecessor Bonds) on the respective Record Date, to the address appearing on the Security Registrar or by such other method, acceptable to the Bank, requested in writing by the Holder at the Holder's risk and expense. The Issuer shall pay all charges from Depositories for untimely payments, provided however, the Bank also agrees to abide by the Depository requirement for same day wire transfer of funds for debt service payment. SECTION 3.02. PAYMENT DATES. The Issuer hereby instructs the Bank to pay the principal of and interest on the Bonds on each Payment Date and such other dates on which a redemption of the Bonds occurs. ARTICLE FOUR REGISTRAR SECTION 4.01. SECURITY REGISTER — TRANSFERS AND EXCHANGES. The Bank agrees to keep and maintain for and on behalf of the Issuer at the Bank Office books and records (herein sometimes referred to as the "Security Register ") for recording the names and addresses of the Holders of the Bonds, the transfer, exchange, and replacement of the Bonds, and the payment of the principal of and interest on the Bonds to the Holders and containing such other information as may be reasonably required by the Issuer and subject to such reasonable regulations as the Issuer and the Bank may prescribe. All transfers, exchanges, and replacement of Bonds shall be noted in the Security Register. The Bank agrees further to keep and maintain a copy of the Security Register 4 at its Office located in the State of Minnesota or provides for such Security Register to be available to be accessed from such Bank Office. Every Security surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, the signature on which has been guaranteed by an officer of a federal or state bank or a member of the National Association of Bonds Dealers, in form satisfactory to the Bank, duly executed by the Holder thereof or his agent duly authorized in writing. The Bank may request any supporting documentation it feels necessary to effect a registration, transfer, or exchange of the Bonds. To the extent possible and under reasonable circumstances, the Bank agrees that, in relation to an exchange or transfer of Bonds, the exchange or transfer by the Holders thereof will be completed and new Bonds delivered to the Holder or the assignee of the Holder in not more than three business days after the receipt of the Bonds to be canceled in an exchange or transfer and the written instrument of transfer or request for exchange duly executed by the Holder, or his duly authorized agent, in form and manner satisfactory to the Paying Agent /Registrar. SECTION 4.02. FORM OF SECURITY REGISTER. The Bank, as Registrar, will maintain the Security Register relating to the registration, payment, transfer, and exchange of the Bonds in accordance with the Bank's general practices and procedures in effect from time to time. The Bank shall not be obligated to maintain such Security Register in any form other than those which the Bank has currently available and currently utilizes at the time. The Security Register may be maintained in written form or in any other form capable of being converted into written form within a reasonable time. SECTION 4.03. LIST OF SECURITY HOLDERS. The Bank will provide the Issuer at any time requested by the Issuer, upon payment of the required fee, a copy of the information contained in the Security Register. The Issuer may also inspect the information contained in the Security Register at any time the Bank is customarily open for business, provided that reasonable time is allowed the Bank to provide an up -to -date listing or to convert the information into written form. Unless required by law, the Bank will not release or disclose the contents of the Security Register to any person other than to, or at the written request of, an authorized officer or employee of the Issuer, except upon receipt of a court order or as otherwise required by law. Upon receipt of a court order and prior to the release or disclosure of the contents of the Security Register, the Bank will notify the Issuer so that the Issuer may contest the court order or such release or disclosure of the contents of the Security Register. 5 SECTION 4.04. CANCELED BONDS. The Bank will retain and destroy canceled and matured Bonds upon expiration of the appropriate retention period. SECTION 4.05. MUTILATED, DESTROYED, LOST, OR STOLEN BONDS. The Issuer hereby instructs the Bank, subject to the applicable provisions of the Bond Ordinance, to deliver and issue Bonds in exchange for or in lieu of mutilated, destroyed, lost, or stolen Bonds as long as the same does not result in an over issuance. In case any Security shall be mutilated, or destroyed, lost, or stolen, the Bank, in its discretion, may execute and deliver a replacement Security of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Security, or in lieu of and in substitution for such destroyed, lost, or stolen Security, only after (i) the filing by the Holder thereof with the Bank of evidence satisfactory to the Bank of the destruction, loss, or theft of such Security, and of the authenticity of the ownership thereof and (ii) the furnishing to the Bank of indemnification in an amount satisfactory to hold the Issuer and the Bank harmless. All expenses and charges associated with such indemnity and with the preparation, execution, and delivery of a replacement Security shall be borne by the Holder of the Security mutilated, or destroyed, lost, or stolen. SECTION 4.06. TRANSACTION INFORMATION TO ISSUER. The Bank will, within a reasonable time after receipt of written request from the Issuer, furnish the Issuer information as to the Bonds it has paid pursuant to Section 3.01, Bonds it has delivered upon the transfer or exchange of any Bonds pursuant to Section 4.01, and Bonds it has delivered in exchange for or in lieu of mutilated, destroyed, lost, or stolen Bonds pursuant to Section 4.05. ARTICLE FIVE THE BANK SECTION 5.01 DUTIES OF BANK. The Bank undertakes to perform the duties set forth herein and in the Bond Ordinance and the Ordinance agrees to use reasonable care in the performance thereof. SECTION 5.02 RELIANCE ON DOCUMENTS, ETC. (a) The Bank may conclusively rely, as to the truth of the statements and correctness of the opinions expressed therein, on certificates or opinions furnished to the Bank. (b) The Bank shall not be liable for any error of judgment made in good faith by a responsible Officer, unless it shall be proved that the Bank was negligent in ascertaining the pertinent facts. 6 (c) No provision of this Agreement shall require the Bank to expend or risk its own funds or otherwise incur any financial liability for performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity satisfactory to it against such risks or liability is not assured to it. (d) The Bank may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, resolution, bond, note, security, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties. Without limiting the generality of the foregoing statement, the Bank need not examine the ownership of any Bonds, but is protected in acting upon receipt of Bonds containing an endorsement or instruction of transfer or power of transfer which appears on its face to be signed by the Holder or an agent of the Holder. The Bank shall not be bound to make any investigation into the facts or matters stated in a resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, bond, note security or other paper document supplied by Issuer. (e) The Bank may consult with counsel, and the written advice of such counsel or any opinion of counsel shall be full and complete authorization and protection with respect to any action taken, suffered, or omitted by it hereunder in good faith and in reliance thereon. (f) The Bank may exercise any of the powers hereunder and perform any duties hereunder either directly or by or through agents or attorneys of the Bank. SECTION 5.03 RECITALS OF ISSUER. The recitals contained herein with respect to the Issuer and in the Bonds shall be taken as the statements of the Issuer, and the Bank assumes no responsibility for their correctness. The Bank shall in no event be liable to the Issuer, and Holder or Holders of any Security, or any other Person for any amount due on any Security from its own funds. SECTION 5.04. MAY HOLD BONDS. The Bank, in its individual or any other capacity, may become the owner or pledgee of Bonds and may otherwise deal with the Issuer with the same rights it would have if it were not the Paying Agent/Registrar, or any other agent. SECTION 5.05. MONEY HELD BY BANK. The Issuer shall deposit or cause to be deposited with the Bank from Pledged Revenues sufficient funds for the payment of the Bonds to pay when due and payable the principal of, redemption premium, if any, and interest on the Bonds. All funds at any time and from time to time provided to or held by the Bank hereunder shall be deemed, construed, and considered for all purposes as being provided to or held by the Bank in 7 trust and as a trustee for the benefit of the Security Holders. The Bank acknowledges, covenants, and represents that it is acting herein in a fiduciary capacity in relation to such funds, and is not accepting, holding, administering, or applying such funds as a banking depository, but solely as trustee and fiduciary for and on behalf of the Security thereto, except as trustee pursuant to the terms of this Agreement. The Holders shall be entitled to the same preferred claim and first lien on the funds so provided as are enjoyed by the beneficiaries of trust funds generally. The funds provided to the Bank hereunder shall not be subject to warrants, drafts, or checks drawn by the Issuer and, except as expressly provided herein, shall not be subject to compromise, setoff, or other charge or diminution by the Bank. The Bank shall be under no liability for interest on any money received by it hereunder. Subject to the unclaimed property laws of the State of Florida and any provisions in the Ordinance or the Bond Ordinance to the contrary, any money deposited with the Bank for the payment of the principal, premium (if any), or interest on any Security and remaining unclaimed for three years after final maturity of the Security has become due and payable will be paid by the Bank to the Issuer, and the Holder of such Security shall thereafter look only to the Issuer for payment thereof, and all liability of the Bank with respect to such money shall thereupon cease. SECTION 5.06. INDEMNIFICATION. To the extent permitted by law, the Issuer agrees to indemnify the Bank for, and hold it harmless against, any loss, liability, or expense incurred without negligence or bad faith on its part, arising out of or in connection with its acceptance or administration of its duties hereunder, including the cost and expense against any claim or liability in connection with the exercise or performance of any of its powers or duties under this Agreement. SECTION 5.07 INTERPLEADER. The Issuer and the Bank agree that the Bank may seek adjudication of any adverse claim, demand, or controversy over its person as well as funds on deposit, in either a Federal or State District Court located in the State and County where either the Bank Office or the administrative offices of the Issuer is located, and agree that service of process to Bank's Interpleader by certified or registered mail, return receipt requested, to the address referred to in Section 6.03 of this Agreement shall constitute adequate service. The Issuer and the Bank further agree that the Bank has the right to file a Bill of Interpleader in any court of competent jurisdiction to determine the rights of any Person claiming any interest herein. SECTION 5.08. DEPOSITORY TRUST COMPANY SERVICES. It is hereby represented and warranted that, in the event the Bonds are otherwise qualified and accepted for "Depository Trust Company" services or equivalent depository trust services by other organizations, the Bank has the capability and, to the extent within its control, will comply with the "Operational Arrangements," effective from time to time, which establishes requirements for Bonds to be eligible for such type depository trust services, including, but not limited to, requirements for the timeliness 8 of payments and funds availability, transfer turnaround time, and notification of redemptions and calls. Operational Arrangements shall govern over any other inconsistent provision. ARTICLE SIX MISCELLANEOUS PROVISIONS SECTION 6.01. AMENDMENT. This Agreement may be amended only by an agreement in writing signed by both of the parties hereto. SECTION 6.02 ASSIGNMENT. This Agreement may not be assigned by either party without the prior written consent of the other. SECTION 6.03. NOTICES. Any request, demand, authorization, direction, notice, consent, waiver, or other document provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or delivered to the Issuer or the Bank, respectively, at the addresses shown below: To the City: With a copy to: To the Bank: City of Clearwater Municipal Services Building 100 S. Myrtle Avenue Clearwater, Florida 33756 -5520 Attention: Brian Jay Ravins, Finance Director City Attorney City of Clearwater 112 South Osceola Avenue, 3rd Floor Clearwater, Florida 33756 Attention: Pamela K. Akin, Esquire U.S. Bank National Association 225 E. Robinson Street, Suite 250 Orlando, Florida 32801 Attention: Corporate Trust SECTION 6.04. EFFECT OF HEADINGS. The Article and Section headings herein are for convenience only and shall not affect the construction hereof. SECTION 6.05. SUCCESSORS AND ASSIGNS. All covenants and agreements herein by the Issuer shall bind its successors and assigns, whether so expressed or not. 9 SECTION 6.06. SEVERABILITY. In case any provision herein shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. SECTION 6.07. BENEFITS OF AGREEMENT. Nothing herein, express or implied, shall give to any Person, other that the parties hereto and their successors hereunder, any benefit or any legal or equitable right, remedy, or claim hereunder. SECTION 6.08. ENTIRE AGREEMENT. This Agreement and the Bond Ordinance constitute the entire agreement between the parties hereto relative to the Bank acting as Paying Agent /Registrar and if any conflict exists between his Agreement and the Bond Ordinance, the Bond Ordinance shall govern. SECTION 6.09. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which shall constitute one and the same Agreement. SECTION 6.10. TERMINATION. This Agreement will terminate on the date of final payment of the principal of interest on the Bonds to the Holders thereof or may be earlier terminated by the Issuer upon 60 days written notice; provided, however, an early termination of this Agreement by the Issuer shall not be effective until (a) a successor Paying Agent/Registrar has been appointed by the Issuer and such appointment accepted and (b) notice has been give to the Holders of the Bonds of the appointment of a successor Paying Agent /Registrar. Furthermore, the Bank and Issuer mutually agree that the effective date of an early termination of this Agreement shall not occur at any time which would disrupt, delay, or otherwise adversely affect the payment of the Bonds. Upon an early termination of this Agreement, the Bank agrees to promptly transfer and deliver the Security Register (or a copy thereof), together with other pertinent books and records relating to the Bonds, to the Successor Paying Agent/Registrar designated and appointed by the Issuer. The provisions of Article Five shall survive and remain in full force and effect following the termination of this Agreement. SECTION 6.11 GOVERNING LAW. This Agreement shall be construed in accordance with and governed by the laws of the State of Florida. SECTION 6.12 SUCCESSOR PAYING AGENT. Any corporation or association into which the Paying Agent may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer its trust business and assets as a whole, or any corporation or 10 association resulting from any such conversion, sale, merger, consolidation or transfer too which it is a party, shall be and become successor Paying Agent hereunder and vested with all of the powers, discretion's, immunities, privileges and all other matters as was its predecessor, without the execution or filing of any instrument or any further act, deed or conveyance on the part of any of the parties hereto, anything herein to the contrary notwithstanding. [Remainder of page left intentionally blank — signature page follows] 11 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. ATTEST: By: Rosemarie Call, City Clerk Approved as to Form: By: Pamela K. Akin, City Attorney ISSUER: CITY OF CLEARWATER, FLORIDA By: George N. Cretekos, Mayor By: William B. Horne, II, City Manager U.S. BANK NATIONAL ASSOCIATION By: James Audette, Vice President [Signature page to Paying Agent Agreement] 12 EXHIBIT D FORM OF OFFICIAL STATEMENT Resolution No. 17 -02 EXHIBIT E FORM OF CONTINUING DISCLOSURE CERTIFICATE Resolution No. 17 -02 CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (the "Disclosure Certificate ") is executed and delivered by the City of Clearwater, Florida (the "Issuer ") in connection with the issuance of its $[Par Amount] Water and Sewer Revenue Refunding Bonds, Series 2017 (the "Series 2017 Bonds "). The Series 2017 Bonds are being issued pursuant to Ordinance No. 3674 -84 enacted by the Issuer on August 2, 1984, as amended and supplemented in Ordinance No. 6915 -01, enacted November 15, 2001, as further amended and supplemented in Ordinance No. 8620 -14, enacted December 4, 2014 (collectively, the "Ordinance ") and as further supplemented by Resolution No. 17 -02, adopted by the Issuer on January 19, 2017. The Issuer covenants and agrees as follows: SECTION 1. PURPOSE OF DISCLOSURE CERTIFICATE. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the Series 2017 Bondholders and in order to assist the original underwriters of the Series 2017 Bonds in complying with Rule 15c2- 12(b)(5) promulgated by the Securities and Exchange Commission ( "SEC ") pursuant to the Securities Exchange Act of 1934, as the same may be amended from time to time (the "Rule "). SECTION 2. PROVISION OF ANNUAL INFORMATION. Except as otherwise provided herein, the Issuer shall provide to the Municipal Securities Rulemaking Board (the "MSRB "), in the manner described in Section 5 hereof, and to any state information depository that is established within the State of Florida and with which the Issuer is legally required to file the information set forth herein (the "SID "), it being understood that no such SID is currently established in the State of Florida, on or before April 30 of each year, commencing April 30, 2017 with the report for the 2016 Fiscal Year, the information set forth below in this Section 2. Notwithstanding the immediately preceding sentence, to the extent any such information does not become available to the Issuer before April 30 of any year, the Issuer shall provide such information when it becomes available, but no later than one year following the end of the Issuer's Fiscal Year. To the extent the Issuer has provided such information to a dissemination agent pursuant to any other undertaking executed by the Issuer in accordance with the Rule, the Issuer's obligations as set forth in this Section 2 shall be deemed to be satisfied. (A) The Issuer's Comprehensive Annual Financial Report for the immediately preceding Fiscal Year (the "CAFR "), which shall include the audited financial statements of the Issuer for the immediately preceding Fiscal Year prepared in accordance with Generally Accepted Accounting Principles, as modified by applicable State of Florida requirements and the governmental accounting standards promulgated by the Government Accounting Standards Board; provided, however, if 1 the audited financial statements of the Issuer are not completed prior to April 30 of any year, the Issuer shall provide unaudited financial statements on such date and shall provide the audited financial statements as soon as practicable following their completion; and (B) To the extent not set forth in the CAFR, additional financial information and operating data of the type included with respect to the Issuer in the final official statement prepared in connection with the sale and issuance of the Series 2017 Bonds (as amended, the "Official Statement "), as set forth below: 1. Updates of the historical financial information set forth in the Official Statement under the principal captions "THE WATER AND SEWER SYSTEM" for the then - immediately preceding five fiscal years and "APPENDIX G - SCHEDULE OF RATES, FEES AND CHARGES." 2. Description of any additional indebtedness payable in whole or in part from the Net Revenues (as defined in the Ordinance). 3. Any other financial information or operating data of the type included in the Official Statement which would be material to a holder or prospective holders of the Series 2017 Bonds. For purposes of this Disclosure Certificate, "Fiscal Year" means the period commencing on October 1 and ending on September 30 of the next succeeding year, or such other period of time provided by applicable law. The Issuer reserves the right to modify from time to time the specific types of information provided or the format of the presentation of such information, to the extent necessary or appropriate in the judgment of the Issuer; provided that the Issuer agrees that any such modification will be done in a manner consistent with the Rule. SECTION 3. REPORTING SIGNIFICANT EVENTS. The Issuer shall provide to the MSRB and to the SID, if any, on a timely basis not in excess of 10 business days after the occurrence of the event, notice of any of the following events, if such event is material with respect to the Series 2017 Bonds or the Issuer's ability to satisfy its payment obligations with respect to the Series 2017 Bonds; provided, however, to the extent the Issuer has provided notice of any such event to a dissemination agent pursuant to any other undertaking executed by the Issuer in accordance with the Rule, the Issuer's obligations as set forth in this Section 3 shall be deemed to be satisfied: (A) Principal and interest payment delinquencies; 2 (B) Non - payment related defaults; (C) Unscheduled draws on the debt service reserve fund reflecting financial difficulties; (D) Unscheduled draws on credit enhancement reflecting financial difficulties; (E) Substitution of credit or liquidity providers, or their failure to perform; (F) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue or other material notices or determinations with respect to the tax status of the Series 2017 Bonds, or other material or events affecting the tax status of the Series 2017 Bonds; (G) Modifications to rights of Series 2017 Bondholders; (H) Calls on the Series 2017 Bonds (excluding mandatory sinking fund redemtption; (I) Tender offers with respect to the Series 2017 Bonds; (J) Defeasance of the Series 2017 Bonds; (K) Release, substitution, or sale of property securing repayment of the Series 2017 Bonds; (L) Rating changes; (M) Bankruptcy, insolvency, receivership or similar event of the Issuer (this event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for the Issuer in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Issuer, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Issuer); (N) The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all of the assets of the Issuer, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; 3 (0) Appointment of a successor or additional trustee or the change of name of a trustee; and The Issuer may from time to time, in its discretion, choose to provide notice of the occurrence of certain other events, in addition to those listed in this Section 3, if, in the judgment of the Issuer, such other events are material with respect to the Series 2017 Bonds, but the Issuer does not specifically undertake to commit to provide any such additional notice of the occurrence of any material event except those events listed above. Whenever the Issuer obtains knowledge of the occurrence of a significant event described in this Section 3, the Issuer shall as soon as possible determine if such event would be material under applicable federal securities law to holders of Series 2017 Bonds, provided, that any event under clauses (A), (C), (D), (E), (F), (I), (J), (L), or (M) above will always be deemed to be material. SECTION 4. NOTICE OF FAILURE TO PROVIDE ANNUAL INFORMATION. The Issuer agrees to provide or cause to be provided to the MSRB, in a timely manner on or before April 30 of any year, notice of any failure on the part of the Issuer or any other Obligated Person (as defined in the Rule) to meet the requirements of Section 2 hereof. SECTION 5. SUBMISSION OF INFORMATION TO THE MSRB. The information required to be disclosed pursuant to Sections 2, 3 and 4 of this Disclosure Certificate shall be submitted to the MSRB through its Electronic Municipal Market Access system ( "EMMA "). Subject to future changes in submission rules and regulations, such submissions shall be provided to the MSRB, through EMMA, in portable document format ( "PDF ") files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. Such PDF files are required to be word - searchable (allowing the user to search for specific terms used within the document through a search or find function available in a software package). Subject to future changes in submission rules and regulations, at the time that such information is submitted through EMMA, the Issuer, or any dissemination agent engaged by the Issuer pursuant to Section 8 hereof, shall also provide to the MSRB information necessary to accurately identify: (A) the category of information being provided; (B) the period covered by the CAFR and any additional financial information and operating data being provided; (C) the issues or specific securities to which such submission is related or otherwise material (including CUSIP number, issuer name, state, issue description/securities name, dated date, maturity date, and/or coupon rate); (D) the name of any Obligated Person other than the Issuer; (E) the name and date of the document being submitted; and (F) contact information for the submitter. SECTION 6. NO EVENT OF DEFAULT. Notwithstanding any other provision in the Ordinance to the contrary, failure of the Issuer to comply with the provisions of this Disclosure Certificate shall not be considered an event of default under the Ordinance. To the extent permitted by law, the sole and exclusive remedy of any Series 2017 Bondholder for the enforcement of the provisions hereof shall be an action for mandamus or specific performance, as applicable, by court order, to cause the Issuer to comply with its obligations hereunder. For purposes of this Disclosure Certificate, "Series 2017 Bondholder" shall mean any person who (A) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Series 2017 Bonds (including persons holding Series 2017 Bonds through nominees, depositories or other intermediaries), or (B) is treated as the owner of any Series 2017 Bond for federal income tax purposes. SECTION 7. INCORPORATION BY REFERENCE. Any or all of the information required herein to be disclosed may be incorporated by reference from other documents, including official statements or debt issues of the Issuer or related public entities, which have been submitted to the MSRB or the SEC. If the document incorporated by reference is a final official statement, it must be available from the MSRB. The Issuer shall clearly identify each document incorporated by reference. SECTION 8. DISSEMINATION AGENTS. The Issuer may, from time to time, appoint or engage a dissemination agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such agent, with or without appointing a successor dissemination agent. SECTION 9. TERMINATION. The Issuer's obligations under this Disclosure Certificate shall terminate upon (A) the legal defeasance, prior redemption or payment in full of all of the Series 2017 Bonds, or (B) the termination of the continuing disclosure requirements of the Rule by legislative, judicial or administrative action. 5 SECTION 10. AMENDMENTS. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision may be waived, if such amendment or waiver is supported by an opinion of counsel that is nationally recognized in the area of federal securities laws, to the effect that such amendment or waiver would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule. SECTION 11. ADDITIONAL INFORMATION. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in its annual information described in Section 2 hereof or notice of occurrence of a significant event described in Section 3 hereof, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in its annual information or notice of occurrence of a significant event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Disclosure Certificate to update such information or include it in its future annual information or notice of occurrence of a significant event. SECTION 12. OBLIGATED PERSONS. If any person, other than the Issuer, becomes an Obligated Person (as defined in the Rule) relating to the Series 2017 Bonds, the Issuer shall use its best efforts to require such Obligated Person to comply with all provisions of the Rule applicable to such Obligated Person. Dated as of this [ ] day of February, 2017 ATTEST: CITY OF CLEARWATER, FLORIDA By: By: Issuer Clerk Mayor 6