Contacts October 30, 2012 CITY OF PALM COAST, FLORIDA Mark Galvin Senior Vice President 450 S. Orange Avenue Suite 460 Orlando, FL Fax Utility System Workshop Preliminary Financing Plan

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, FL, F LORIDA Table of Contents Overview of City’s Utility System DebtTab 1 Refunding of Series 2003 BondsTab 2 2

CITY OF P ALM C OAST, FLORIDA Tab 1 Overview of the City’s Utility System Debt

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, FL, F LORIDA Debt Profile – Utility System Revenue Debt

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, FL, F LORIDA Aggregate Utility System Revenue Debt 5 Date Series 2003 Debt Service Series 2007 Debt Service Total Debt Service 10/1/2013 $6,288,403 $3,131,106 $9,419,509 10/1/2014 6,289,413 3,130,906 9,420,319 10/1/2015 6,286,663 3,128,906 9,415,569 10/1/2016 6,288,163 3,129,681 9,417,844 10/1/2017 6,288,413 3,129,081 9,417,494 10/1/2018 6,285,350 3,128,331 9,413,681 10/1/2019 6,284,938 3,128,131 9,413,069 10/1/2020 6,286,650 3,130,731 9,417,381 10/1/2021 6,284,963 3,130,931 9,415,894 10/1/2022 6,289,613 3,128,731 9,418,344 10/1/2023 6,288,613 3,127,981 9,416,594 10/1/2024 6,288,863 3,128,231 9,417,094 10/1/2025 6,284,863 3,129,231 9,414,094 10/1/2026 6,286,363 3,129,756 9,416,119 10/1/2027 6,287,613 3,126,881 9,414,494 10/1/2028 6,288,113 3,130,606 9,418,719 10/1/2029 6,289,150 3,130,506 9,419,656 10/1/2030 6,284,500 3,126,056 9,410,556 10/1/2031 6,286,000 3,127,331 9,413,331 10/1/2032 6,284,500 3,128,881 9,413,381 10/1/2033 6,289,500 3,130,481 9,419,981 10/1/2034 3,126,906 10/1/2035 3,126,594 10/1/2036 3,126,031 Totals $132,030,639 $75,092,013 $207,119,643

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, FL, F LORIDA Debt Profile – Utility System Debt

CITY OF P ALM C OAST, FLORIDA Tab 2 Refunding of Series 2003 Bonds

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, F LORIDA Savings Total Savings$11,616,353 Average Annual Savings$553,160 Present Value Savings$8,149,889 Present Value Savings %10.10% Refunding Bonds Detail (Series 2012) Assumes the City maintain it existing ratings of A1, A/A+ Principal Amount$73,800,000 Average Annual Debt Service$5,734,014 Maturity10/1/2033 All-In True Interest Cost3.55% Refunded Bonds Detail (Series 2003) Principal Refunded$80,685,000 Coupon Rates4.50% % Call 100% Summary of Refunding Results (Series 2003 Bonds) 8 Notes -Analysis is preliminary and subject to change. -Estimated cost of issuance of $630 & $6 per bond for UW discount -Uninsured A1/A/A+ market rates as of EOD 10/17/2012 Assumes no transfer of existing DSRF or funding of a DSRF for Series 2012 issue

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, F LORIDA Refunding Considerations 9  City current Utility System 5 Year Capital Plan has identified over $78.4 million in capital improvements including $21 million in immediate funding needs.  With interest rates at historical lows and with impending refunding of the Series 2003 provides the City incorporate both financings into one reducing issuance costs.  Opportunity to free up / release $6,240,000 from Series 2003 Debt Service Reserve to fund a portion of the $21 million in projects with the $15 million balance coming from bond proceeds.  Opportunity to update bond covenants to provide future financing flexibility.

Member FINRA & SIPC © 2012 First Southwest Company C ITY OF P ALM C OAST, F LORIDA Summary of Financing – Proposed Financing Structure 10 Bond DetailsSeries 2013 Par amount*$88,130,000 Project fund amount$21,000,000 including released Series 2003 DSR Fund Final maturity*10/1/2036 Combined Maximum Annual Debt Service* (Series 2013 & 2007) $9,858,781 Incremental debt service increase of providing $21 million in project funding $435,000 * Subject to change based upon market conditions (includes original issue premium of approximately $12 million.