1. Contacts October 30, 2012 CITY OF PALM COAST, FLORIDA Mark Galvin Senior Vice President Mark.galvin@firstsw.com 450 S. Orange Avenue Suite 460 Orlando, FL 32801 407.426.9611 407.426.7835 Fax Utility System Workshop Preliminary Financing Plan

2. 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

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

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

5. 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

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

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

8. 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% - 5.125% Call Date/Price10/1/2033 @ 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

9. 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.

10. 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.