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15441ORDINANCE N0, 15,441 AN ORDINANCE AUTHORIZING THE ISSUANCE OF CAPITAL IMPROVEMENT BONDS; PLEDGING TAX REVENUES SUFFICIENT TO PAY THE PRINCIPAL OF AND INTEREST ON THE BONDS; PRESCRIBING OTHER MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY. WHEREAS, by Ordinance No. 15,338 duly adopted by the Board of Directors on the 18th day of August, 1987, there was submitted to the qualified electors of the City of Little Rock, Arkansas, the question of the issuance of bonds in the following maximum amounts for the following purposes: $19,675,000 for the purpose of constructing, reconstructing, repairing, straightening, and widening of streets in the City, including curbing, guttering and drainage improvements; $900,000 for the purpose of providing additional drainage improvements in the City; $1,000,000 for the purpose of acquiring, constructing and equipping a new police substation in the City; $8,690,000 for the purpose of acquiring, renovating, constructing and equipping public park improvements in the City, including improvements to the Little Rock Zoo; $1,000,000 for the purpose of acquiring, constructing or equipping two fire stations in the City; $2,000,000 for the purpose of acquiring, constructing and equipping a new library branch in the City; $950,000 for the purpose of making improvements to the Arkansas Arts Center; $1,500,000 for the purpose of acquiring, constructing and equipping a detention center in the City; 76 0 -9? ,r--1 $1,500,000 to finance improvements to Robinson Auditorium and the contiguous plaza; $800,000 for the purpose of matching on a dollar for dollar basis funds provided by the South Main Improvement District to be used in constructing, repairing and installing sidewalks, lighting and right -of -way improvements in the South Main Improvement District and for matching on a dollar for dollar basis funds provided by individual property owners and used for restoring historic building facades in the central business district; $200,000 for the purpose of making improvements to the Arkansas Museum of Science and History in MacArthur Park; $900,000 for the purpose of making improvements to streets and sidewalks in the Hillcrest, Ouapaw Quarter and Capitol Avenue areas, including street lights and right -of -way improvements; and WHEREAS, due notice of the election was given as required by law and the election was duly held on the 13th day of October, 1987, at which election the electors approved the issuance of bonds for each of said purposes; and WHEREAS, the aggregate maximum amount of bonds approved was $39,115,000; and WHEREAS, the results of the election were announced by the Mayor by a Proclamation duly published as required by law in a newspaper of bona fide circulation in the City of Little Rock, Arkansas; and WHEREAS, pursuant to Ordinance No. 15,370, adopted November 3, 1987, the City has fixed, established and levied a tax of 3.434 mills on the dollar of assessed valuation (the "Special Tax ") which will constitute a continuing annual tax to be collected in 1988 and each year thereafter so long as necessary to pay the principal of, interest on, and fees of the bond registrar and paying agent and alternate paying agent in connection with the bonds herein authorized; and WHEREAS, the estimated aggregate cost of the purposes approved is $39,115,000, but the City expects that a portion of 2 7'7 M 78 the required amount can be provided from investment earnings; and WHEREAS, bonds in the principal amount of $33,595,000 were duly advertised for sale, the said bonds to be dated March 1, 1988, the interest thereon to be payable semiannually on March 1 and September 1 of each year and with the bonds maturing or subject to mandatory sinking fund redemption on March 1 in each of the years 1989 to 2013, inclusive, all as specified in the notice of sale; and WHEREAS, said sale was duly held pursuant to advertisement on the 17th day of February, 1988, and at said sale Smith Barney, Harris Upham & Co. Incorporated (the "purchaser ") bid and offered the price of $33,125,874.95 for bonds bearing interest at the rates set out in Section 2, resulting in a true (Canadian) interest cost of 7.4121% per annum, and this being the best bid for said bonds, the bonds should be sold to the purchaser for said price; NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE CITY OF LITTLE ROCK, ARKANSAS: Section 1. That the $33,595,000 of bonds are hereby sold to the purchaser at the purchase price specified above. Section 2. That under the authority of the Constitution and laws of the State of Arkansas, including particularly Amendment No. 62 to the Constitution of the State of Arkansas, and the Local Government Bond Act of 1985 (Arkansas Code of 1987 Annotated § §14- 164 -301, et. seg.), City of Little Rock, Arkansas Capital Improvement Bonds are hereby authorized and ordered issued in the total principal amount of $33,595,000. The proceeds of the bonds, together with investment earnings thereon, shall be used for the purposes specified in the recitals of this Ordinance. The bonds shall be dated March 1, 1988 and the interest thereon shall be payable semiannually on March 1 and September 1 of each year commencing September 1, 1988. The bonds shall be fully registered bonds in the denomination of $5,000 or an integral multiple thereof. The bonds shall be initially issued in the denominations and registered in the names of the registered owners specified by the purchaser. Principal shall be payable to the registered owners thereof upon presentation at the corporate trust office of the paying agent. Each bond shall bear interest from its Interest Commencement Date until paid at the rate specified below for its maturity. The "Interest Commencement Date" for each bond shall be (i) the last interest payment date for the bonds preceding the date of 3 authentication to which interest on the bonds has been paid or made available for payment, or (ii) if the date of authentication is an interest payment date to which interest on the bonds has been paid or made available for payment, the date of authentication, or (iii) if the date of authentication is prior to the first interest payment date, the date of the bonds. Payment of each installment of interest shall be made at the time and in the manner specified in the bond form in Section 4. The bonds shall be numbered from R -1 upward in order of issuance and shall mature on March 1 of each year and bear interest as follows: Maturity Date Principal Amount Interest Rata 3/1/89 $ 580,000 5.00% 3/1/90 605,000 5.20% 3/1/91 640,000 5.40% 3/1/92 675,000 5.60% 3/1/93 710,000 5.80% 3/1/94 750,000 6.00% 3/1/95 795,000 6.20% 3/1/96 845,000 6.40% 3/1/97 900,000 6.60% 3/1/98 960,000 6.70 0a 3/1/99 1,025,000 6.80; 3/1/00 1,095,000 6.90% 3/1/01 1,170,000 7.00% 3/1/02 1,250,000 7.10% 3/1/03 1,340,000 7.20% 3/1/04 1,435,000 7.30% 3/1/05 1,540,000 7.40% 3/1/06 1,655,000 7.40% 3/1/07 1,780,000 7.50% 3/1/08 1,910,000 7.50% 3/1/09 2,055,000 7.50% 3/1/10 2,210,000 7.50% 3/1/13 7,670,000 7.50% Union National Bank of Little Rock, Little Rock, Arkansas, is designated as bond registrar and paying agent. Chemical Bank, New York, New 'cork, is designated alternate paying agent. Section 3. Definitions. In addition to other definitions herein, capitalized terms used in this Ordinance shall, unless the context requires a different meaning, have the meanings specified below. 9 79 80 The term "Code" means the Internal Revenue Code of 1986, as amended. The term "Debt Service" means the scheduled amount of interest and amortization of principal payable on the bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. The term "Gross Proceeds" means the sum of the following amounts: (i) original proceeds, namely, net amounts received by the City as a result of the sale of the bonds, excluding original proceeds which become transferred proceeds (determined in accordance with applicable Regulations) of obligations issued to refund in whole or in part the bonds; (ii) investment proceeds, namely, amounts received at any time by or for the City, such as interest and dividends, resulting from the investment of any original proceeds (as referenced in clause (i) above) or investment proceeds (as referenced in this clause (ii) in Nonpurpose Investments, increased by any profits and decreased (if necessary, below zero) by any losses on such investments, excluding investment proceeds which become transferred proceeds (determined in accordance with applicable Regulations) of obligations issued to refund in whole or in part the bonds; (iii) sinking fund proceeds, namely, amounts, other than original proceeds or investment proceeds (as referenced in clauses (i) and (ii) above) of the bonds, which are held in the Bond Fund and any other fund to the extent that the City reasonably expects to use such other fund to pay Debt Service on the bonds; (iv) Investment Property pledged as security for payment of Debt Service on the bonds; (v) amounts, other than as specified in this definition, used to pay Debt Service on the bonds; and (vi) amounts received as a result of investing amounts described in this definition. The term "Investment Property" means any security (as said term is defined in Section 165(g)(2)(A) or (B) of the Code), obligation, annuity contract or investment -type property, excluding, however, obligations the interest on which is I excluded from gross income, under Section 103 of the Code, for federal income tax purposes. The term "Diet Proceeds ", when used with reference to the bonds, means the face amount of the bonds, plus accrued interest and premium, if any, less original issue discount, The term "Dlonpurpose Investment" means any Investment Property which is acquired with the Gross Proceeds of the bonds and is not acquired in order to carry out the governmental purpose of the bonds. The term "Private Business Use" means use directly or indirectly in a trade or business carried on by a natural person or in any activity carried on by a person other than a natural person, excluding, however, use by a state or local governmental unit and use as a member of the general public. The term "Purchase Price," for the purpose of computation of the Yield of the bonds, has the same meaning as the term "issue price" in Sections 1273(b) and 1274 of the Code, and, in general, means the initial offering price of the bonds to the public (not including bond houses and brokers, or similar persons or organizations acting in the capacity of underwriters or wholesalers) at which price a substantial amount of the bonds of each maturity are sold or, if the bonds are privately placed, the price paid by the first buyer of the bonds or the acquisition cost of the first buyer. The term "Regulations" means temporary and permanent regulations promulgated under the Code. The term "Yield" means that yield which, when used in computing the present worth of all payments of principal and interest on the bonds, produces an amount equal to the Purchase Price of the bonds, all computed as prescribed in applicable Regulations. Section 4. The bonds shall be executed on behalf of the City by the Mayor and City Clerk by their facsimile signatures and a facsimile of the corporate seal of the City shall be reproduced on each bond. The bonds shall be in substantially the following form: 0 w� w� ■w wi w ■� w� wi w i (Face of Bond) REGISTERED ienON w � w� w ■� �w • UNITED STATES OF AMERICA STATE OF ARKANSAS CITY OF LITTLE ROCK CAPITAL IMPROVEMENT BOND Interest Commencement Date: Maturity Date: Principal Amount: Registered Owner: REGISTERED Interest Rate: IP: FAN For value received, the City of Little Rock, Arkansas (the "City "), promises to pay to the registered owner shown above, or registered assigns, the principal amount shown above on the Maturity Date identified above and to pay interest (computed on the basis of a 360 -day year of twelve 30 -day months) on such principal amount from the Interest Commencement Date specified above until paid at the Interest Rate per annum set forth above. Interest is payable on each March 1 and September 1 after the Interest Commencement Date. Principal of this bond is payable to the registered owner, in lawful money of the United States of America, upon presentation when due at the corporate trust office of Union National Bank of Little Rock, Little Rock, Arkansas, the bond registrar and paying agent, in Little Rock, Arkansas. Payment of each installment of interest shall be made to the person in whose name this bond is registered on the registration books of the City maintained by the bond registrar at the end of the fifteenth day of the month next preceding each interest payment date (the "Record Date "), irrespective of any transfer or exchange of this bond subsequent to such Record Date and prior to such interest payment date. Such interest payments shall be by check or draft drawn on the paying agent or, at the option of the registered owner, drawn on Chemical Bank, New York, New York, the alternate paying agent, and mailed to such registered owner at the address appearing on such registration books. This bond is issued under the authority of the Constitution and laws of the State of Arkansas, including particularly Amendment 62 to the Arkansas Constitution and the Local Government Bond Act of 1985. It shall not be valid unless the Certificate of Authentication shall have been signed by the bond registrar. 7 • This bond is one of an issue of bonds of the City designated "Capital Improvement Bonds," dated March 1, 1988 (the "bonds ") in the principal amount of $33,595,000. (SEE THE REVERSE SIDE FOR ADDITIONAL PROVISIONS WHICH HAVE THE SAME EFFECT AS IF FULLY SET FORTH IN THIS PLACE. ) IN WITNESS WHEREOF, the City has caused this bond to be executed by its Mayor and City Clerk by their facsimile signatures and a facsimile of its corporate seal to be reproduced hereon. CITY OF LITTLE ROCK, ARKANSAS (facsimile signature) Mayor (facsimile signature) City Clerk (FACSIMILE SEAL) CERTIFICATE OF AUTHENTICATION This bond is one of the bonds described in the within mentioned Ordinance and is one of the Capital Improvement Bonds, dated March 1, 1988 of the City of Little Rock, Arkansas. UNION NATIONAL BANK OF LITTLE ROCK Little Rock, Arkansas Bond Registrar By Authorized Officer 8 83 (Back of Bond) CITi' OF LITTLE ROCK, ARKANSAS CAPITAL IMPROVEMENT BOND ADDITIONAL PROVISIONS M This bond and the issue of which it forms a part are limited tax general obligations of the City, payable from the proceeds of a continuing annual tax of 3.434 mills on the dollar of the assessed valuation of the taxable real and personal property in the City (the "Special Tax ") levied by the Board of Directors under the authority of Amendment No. 62 to the Constitution of the State of Arkansas. The City hereby pledges its full faith, credit and taxing power, including the said Special Tax, for the payment of this bond and the issue of which it forms a part. The Special Tay, shall be collected with the property taxes payable in 1988 and continuing annually thereafter until all of the bonds and interest thereon have been paid in full. Because of the effect of Amendment 59 to the Arkansas Constitution the rate of the Special Tax applicable to personal property and the property of public utilities and regulated carriers may be less than 3.434 mills on the dollar. The bonds are not secured by any lien on or security interest in any physical properties. The bonds are issuable only in the form of fully registered bonds in denominations of $5,000 or an integral multiple thereof. The City, the bond registrar, the paying agent and the alternate paying agent may deem and treat the registered owner hereof as the absolute owner of this bond for the purpose of receiving payment of or on account of principal hereof and interest due hereon and for all other purposes, and shall not be affected by any notice to the contrary. This bond is transferable, in whole or in part, only upon delivery to the bond registrar of the bond, accompanied by a written instrument of transfer in substantially the form endorsed hereon, duly executed by the registered owner or his attorney -in -fact or legal representative. Upon such transfer, the bond registrar shall enter the transfer of ownership in the registration books and shall authenticate and deliver in the name or names of the new registered owner or owners a new fully registered bond or bonds of authorized denominations of the same maturity and interest rate for the aggregate principal amount of the bond transferred at the earliest practicable time. There shall be no charge to the transferor or transferee for any transfer, except an amount or amounts sufficient to reimburse the City and the bond registrar for any tax, fee or other 9 governmental charge required to transfer. The City and the bond to transfer any bond which has whole or in part. 85- be paid with respect to such registrar shall not be required been called for redemption in The bonds maturing on and after March 1, 1999, are subject to redemption prior to maturity at the option of the City, in whole or in part, in inverse order of maturities (less than all of the bonds of a single maturity to be selected by lot by the paying agent in such manner as it may determine), on any interest payment date on or after March 1, 1998, at a redemption price equal to 100% of the principal amount thereof plus accrued interest to the date of redemption. The bonds maturing March 1, 2013, are also subject to redemption in part (bonds or portions to be redeemed to be selected by lot by the paying agent in such manner as it may determine), on March 1, 2011, and March 1, 2012, at the principal amount thereof plus accrued interest to the date of redemption from mandatory sinking fund installments which are required to be made in amounts sufficient to redeem on March 1 of each year the principal amount of such bonds specified for each of the years shown below: Year Amount 2011 $2,375,000 2012 2,550,000 2013 (maturity) 2,745,000 The City shall receive a credit against mandatory sinking fund redemption requirements equal to 100% of the principal amount of any Bonds maturing March 1, 2013 which shall have been either (i) delivered to the paying agent not less than 45 days prior to any mandatory sinking fund redemption date, for cancellation and discharge of mandatory sinking fund redemption requirements, or (ii) redeemed other than in accordance with mandatory sinking fund redemption requirements. Bonds of denominations greater than $5,000 may be redeemed partially in the amount of $5,000 or any integral multiple thereof. Notice of redemption identifying the bonds or portions thereof to be redeemed shall be given by the paying agent, not less than thirty nor more than sixty days prior to the date fixed for redemption, by mailing a copy of the redemption notice by first class mail, postage prepaid, to all registered owners of bonds to be redeemed. Failure to mail an appropriate notice or any such notice to one or more registered owners of bonds to IM 0 M be redeemed shall not affect the validity of the proceedings for redemption of other bonds as to which notice of redemption is duly given and in proper and timely fashion. All such bonds thus called for redemption shall cease to bear interest on and after the date fixed for redemption, provided funds for their redemption are on deposit with the paying agent at that time. IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts conditions and things required to exist, happen and be performed precedent to and in the issuance of this bond have existed, have happened and have been performed in due time, form and manner as required by law; that the indebtedness represented by this bond and the issue of which it forms a part, does not exceed any constitutional or statutory limitation; and that a tax sufficient to pay the bonds has been duly levied in accordance with Amendment No. 62 to the Constitution of the State of Arkansas and made payable annually until all of the bonds and interest thereon have been fully paid and discharged. 11 ABBREVIATIONS 87 The following abbreviations, when used in the inscription on the face of the within bond, shall be construed as though they were written out in full according to applicable laws or regulations. TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF TRANS MIN ACT - as Custodian for (Gust) (Minor) under the Uniform Transfers to Minors Act of (State) Additional abbreviations may also be used though not in the list above. 12 TRANSFER Leo 9 FOR VALUE RECEIVED, the undersigned Transferor or Transferors hereby sell, assign and transfer the within bond and all rights thereunto to the Transferee or Transferees whose name(s), address and social security or federal employer identification number are shown below, and irrevocably constitute and appoint as attorney to transfer the within bond on the books kept for registration thereof, with full power of substitution in the premises. Name of Transferee(s): Address of Transferee(s) (one address only): Social Security or Federal Employer Identification No. of Transferee(s) (one number only): Dated: Transferor Transferor NOTICE: No transfer will be issued in the name of the Transferee(s), unless the signature(s) to this assignment correspond with the name(s) appearing upon the face of the within bond in every particular, without alteration or enlargement or any change whatever and the Social Security or Federal Employer Identification Number of the Transferee is supplied. Signature(s) of Transferor(s) Guaranteed: NOTICE: Signature(s) must be guaranteed by a member firm of the National Association of Securities Dealers or a commercial bank or a trust company. 13 0 0 M M M M 89 Section 5. That in order to pal the bonds as they mature or are called for redemption prior to maturity, with interest thereon, there is hereby pledged all of the proceeds derived from the Special Tax levied pursuant to Ordinance No. 15,370, passed and adopted November 3, 1987 of 3.434 mills on each dollar of assessed valuation to be collected with the tares in the year 1988, which Special Tax shall continue annually thereafter until all of the bonds authorized hereby and interest thereon have been paid in full. The City covenants and agrees that all revenues from said Special Tax shall be accounted for separately as a special fund on the books of the City which is hereby created and designated "1988 Bond Retirement Fund" (hereinafter called "Bond Fund "). Uninvested Bond Fund moneys shall be deposited in such depository or depositories as may be designated from time to time by the Board of Directors. All such deposits shall either be insured by the Federal Deposit Insurance Corporation or secured by direct or fully guaranteed obligations of the United States of America. Collections of the Special Tax shall be used solely for the payment of the principal of and interest on the bonds, fees of the bond registrar, paying agent and alternate paling agent, and costs of redemption, either at maturity or at redemption prior to maturity. Moneys held for the credit of the Bond Fund may be invested and investment income used as provided in Section 14. Section 6. That for the prompt payment of the bonds of this issue with interest, the City pledges its full faith, credit and taring power, including a sufficient amount of the tax described in Section 5. Section 7. That in order to pay the principal of and interest on the bonds as they mature and to pay mandatory sinking fund installments for the partial redemption of term bonds, there are hereby appropriated out of the proceeds of the above referred to Special Tax, and if said proceeds be not sufficient, then out of the general revenues of the City, the sums necessary to promptly pay the principal of and interest on the bonds as they mature or are subject to mandatory sinking fund redemption according to the following schedule: 14 M M M M Section B. That the bonds of this issue shall be callable for payment prior to maturity in accordance with the terms set out in the bond form in Section 4 of this Ordinance. Section 9. That the Finance Director of the City is hereby ordered and directed to place on deposit with the paying agent, at least two (2) business days before the maturity, redemption or interest payment date of any bond issued hereunder, an amount from the funds herein appropriated equal to the amount of such bond or interest, for the sole purpose of paying the same, together with the customary paying agent's fees. This instruction to the Finance Director is irrevocable and may be enforced by mandamus. Section 10. The bond registrar shall immediately notify the City of each default in the payment of principal of or interest on any bond and of any other default under the 15 •, Principal Due 12 months at Maturity or Ended Upon Sinking Interest March 1 Fund Redemption March 1 September 1 Total 1988 $1,185,767.50 $1,185,767.50 1989 $ 580,000 $1,185,767.50 1,171,267.50 $2,937,035.00 1990 605,000 1,171,267.50 1,155,537.50 2,931,805.00 1991 640,000 1,155,537.50 1,138,257.50 2,933,795.00 1992 675,000 1,138,257.50 1,119,357.50 2,932,615.00 1993 710,000 1,119,357.50 1,098,767.50 2,928,125.00 1994 750,000 1,098,767.50 1,076,267.50 2,925,035.00 1995 795,000 1,076,267.50 1,051,622.50 2,922,890.00 1996 845,000 1,051,622.50 1,024,582.50 2,921,205.00 1997 900,000 1,024,582.50 994,882.50 2,919,465.00 1998 960,000 994,882.50 962,722.50 2,917,605.00 1999 1,025,000 962,722.50 927,872.50 2,915,595.00 2000 1,095,000 927,872.50 890,095.00 2,912,967.50 2001 1,170,000 890,095.00 849,145.00 2,909,240.00 2002 1,250,000 849,145.00 804,770.00 2,903,915.00 2003 1,340,000 804,770.00 756,530.00 2,901,300.00 2004 1,435,000 756,530.00 704,152.50 2,895,682.50 2005 1,540,000 704,152.50 647,172.50 2,891,325.00 2006 1,655,000 647,172.50 585,937.50 2,888,110.00 2007 1,780,000 585,937.50 519,187.50 2,885,125.00 2008 1,910,000 519,187.50 447,562.50 2,876,750.00 2009 2,055,000 447,562.50 370,500.00 2,873,062.50 2010 2,210,000 370,500.00 287,625.00 2,580,500.00 2011 2,375,000 287,625.00 198,562.50 2,950,250.00 2012 2,550,000 198,562.50 102,937.50 2,947,125.00 2013 2,745,000 102,937.50 2,950,875.00 Section B. That the bonds of this issue shall be callable for payment prior to maturity in accordance with the terms set out in the bond form in Section 4 of this Ordinance. Section 9. That the Finance Director of the City is hereby ordered and directed to place on deposit with the paying agent, at least two (2) business days before the maturity, redemption or interest payment date of any bond issued hereunder, an amount from the funds herein appropriated equal to the amount of such bond or interest, for the sole purpose of paying the same, together with the customary paying agent's fees. This instruction to the Finance Director is irrevocable and may be enforced by mandamus. Section 10. The bond registrar shall immediately notify the City of each default in the payment of principal of or interest on any bond and of any other default under the 15 •, L-7 M M M M authorizing ordinance of which the bond registrar has knowledge. Any default in the payment of the principal of or interest on any bond, and any default in the performance of any other covenant herein which continues for 30 days after written notice thereof is given to the City by the bond registrar shall constitute an event of def .ilt. The bond registrar shall notify the registered owners of '-he bonds of each event of default by first class mail. The owners of not less than 10% in principal amount of the bonds then outstanding may by proper suit compel the performance of the duties of the officials of the City under the Constitution and laws of the State of Arkansas and under this Ordinance and protect and enforce the rights of the owners by instituting appropriate proceedings at law or in equity or by other action deemed necessary or desirable. If any default in the payment of principal or interest continues for 30 days the owners of not less than 50% in principal amount of the then outstanding bonds may declare all outstanding bonds immediately due and payable together with accrued interest thereon. No one or more owners of the bonds shall have any right in any manner by his or their action to affect, disturb or prejudice the security of this Ordinance, or to enforce any right hereunder except in the manner provided herein. All proceedings at law or in equity shall be instituted, had and maintained in the manner provided herein and for the benefit of all owners of outstanding bonds. Any individual rights of action are restricted by this Ordinance to the rights and remedies herein provided. clothing shall, however, affect or impair the right of an owner to enforce the payment of the principal of and interest on any bond at and after the maturity thereof. No delay or omission of any owner of a bond to exercise any right or power accrued upon any default shall impair any such right or power or be construed to be a waiver of any such default or acquiescence therein, and every power and remedy given to the owners of the bonds may be exercised from time to time and as often as may be deemed expedient. The owners of not less than 500% in principal amount of the bonds then outstanding shall have the right, during the continuance of an event of default, to direct the time, method and place of conducting any proceedings for any remedy of bondholders, and may waive any default which shall have been remedied before the entry of final judgment or decree in any suit, action or proceeding or before the completion of the enforcement of any other remedy. No such waiver shall extend to or affect any other existing or subsequent default or defaults or impair any rights or remedies consequent thereon. 16 01 60M Section 11. The bond registrar, paying agent and alternate paying agent shall each be responsible only for the exercise of good faith and reasonable prudence in the execution of its trust. The recitals in this Ordinance and in the face of the bonds are the recitals of the City and not of the bond registrar, paying agent and alternate paying agent. The bond registrar and paving agent shall at all times be a single bank with principal offices located in the City and having capital and surplus of at least $25,000,000. The alternate paying agent, if any, shall be a bank or trust company whose principal corporate offices are located in New York., New York. In rase of resignation or removal of either agent, the successor must have the same qualifications. If an incumbent agent fails to maintain the qualifications specified in this paragraph, such failure shall i so facto be deemed a resignation. The bond registrar will maintain books for the registration and transfer of ownership of the bonds. The principal of all bonds, payable either at maturity or upon redemption prior to maturity, shall be paid upon surrender of the bond at the corporate trust office of the paying agent. Interest shall be paid by check or draft drawn on the paying agent or, at the option of a registered owner, drawn on the alternate paying agent, and mailed to each registered owner at the address shown on the registration books. The bond registrar and paying agent may resign by giving notice in writing to the City Clerk. Such resignation shall be effective upon the appointment of a successor bond registrar and paying agent_ by the City and acceptance of appointment by the successor. If the City fails to appoint a successor within 30 days of receiving notice of resignation, the bond registrar and paying agent may apply to a court of competent jurisdiction for appointment of a successor. The alternate paying agent may resign by giving notice in writing to the bond registrar and paying agent. Such resignation shall be effective on the date specified in the notice, but not less than 60 days after the giving of notice. The registered owners of a majority in principal amount of outstanding bonds may, but shall not be required to, appoint a successor alternate paying agent. The owners of a majority in principal amount of outstanding bonds may at any time, with or without cause, remove either the bond registrar and paying agent or the alternate paying agent and appoint a successor. The City shall give notice in writing to the owners of outstanding bonds of any 17 resignation, removal or appointment of a successor bond registrar and paying agent or alternate paying agent. The bond registrar and paying agent and the alternate paying agent shall each be entitled to reasonable compensation for its services hereunder. Section 12. The original bond registrar and paying agent and the original alternate paying agent and any successor to either shall file a written acceptance and agreement to execute the trust imposed upon it or them by this Ordinance, but only upon the terms and conditions set forth in this Ordinance, and subject to the provisions of this Ordinance, to all of which the respective holders of the bonds agree. Such written acceptance shall be filed with the City Clerk and a copy therein shall be placed in the bond transcript. Any successor agent shall have all the powers herein granted to the original agent. Section 13. That the bonds herein authorized shall be delivered to the bond registrar, which shall authenticate and deliver them to the purchaser, or order, upon payment in Federal Reserve funds of an amount equal to the purchase price specified in the purchaser' bid, less the good faith deposit of $671,900, plus accrued interest from March 1, 1988 to date of delivery. (1) From the proceeds of the sale of the bonds, there shall be deposited in the Bond Fund the accrued interest. (2) The balance of the proceeds shall be deposited in an account designated 111988 Capital Improvement Fund" (hereinafter called "Improvement Fund ") and shall be used solely for the purposes hereinabove specified, for necessary expenses incidental thereto, and for the expenses of the issuance of the bonds. To the extent other moneys are not available for the purpose, Improvement Fund moneys will also be used to pay interest on the bonds due September 1, 1988. Section 14, (a) Moneys held for the credit of the Bond Fund shall, as nearly as may be practicable, be continuously invested and re- invested by the City in direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States government, which shall mature or which shall be subject to redemption by the holder thereof at the option of the holder not later than the time the funds will be needed as determined by the City, and in any event not more than ten (10) years after the date of acquisition. Moneys held for the credit of the Improvement Fund may be invested and reinvested by the City in direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United M 93 • 94 States government, having maturity dates or subject to redemption by the holder on or prior to the date the funds will be needed as determined by the City. (b) Moneys held for the credit of the Improvement Fund or Bond Fund and not invested shall be deposited in a depository or depositories selected by the City. All such bank deposits, including those in the form of certificates of deposit, and any interest to be paid on accounts or certificates shall at all times be either insured by the Federal Deposit Insurance Corporation, or secured by a valid and perfected pledge of collateral consisting of direct or fully guaranteed obligations of the United States of America. (c) Interest earned by investments or deposits of either the Bond Fund or the Improvement Fund may be used by the City for any municipal purpose. Section 15. That the terms of the bonds and of this Ordinance shall constitute a contract between the City and the holders of the bonds. Except as provided below, no variation or change in the undertakings herein set forth shall be made while any of these bonds are outstanding. The owners of not less than 75% in aggregate principal amount of the bonds then outstanding have the right, from time to time, to consent to the adoption by the City of ordinances modifying any of the terms or provisions contained in the bonds or this Ordinance; provided, however, there shall not be permitted (a) any extension of the maturity of the principal of or interest on any bond, or (b) a reduction in the principal amount of any bond or the rate of interest thereon, or (c) the creation of any additional pledge on the revenues pledged to the bonds other than as authorized in the original authorizing ordinance, or (d) a privilege or priority of any bond or bonds over any other bond or bonds, or (e) a reduction in the aggregate principal amount of the bonds required for such consent. Section 16. Tax Covenants. (a) The City covenants that it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of the interest on the bonds under Section 103 of the Code. The City will not directly or indirectly use or permit the use of any proceeds of the bonds or any other funds of the City, or take or omit to take any action that would cause the bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Code. To that end, the City will comply with all requirements of Section 148 of the Code to the extent applicable to the bonds. 19 (b) Private Business Use Limitation. The City shall assure that not in excess of five percent (5%) of the Net Proceeds of the bonds is used, directly or indirectly, for (i) Private Business Uses, or (ii) to make or finance a loan (other than loans constituting Nonpurpose Investments) to persons other than state or local government units. (c) Federal Guarantee Prohibition. The City shall not take any action or permit or suffer any action to be taken if the result of the same would be to cause the bonds to be "federally guaranteed" within the meaning of Section 149(b) of the Code and Regulations promulgated thereunder. (d) Information Reporting. The Mayor of the City shall, not later than the 15th day of the second calendar month after the close of the calendar quarter in which the bonds are issued, submit to the Secretary of the Treasury a statement concerning the bonds which will. satisfy the requirements of paragraph (2) of Section 149(e) of the Code and applicable Regulations. (e) Rebate Fund. There is hereby created on the books of the City a special fund to be named the "Rebate Fund" to be accounted for separately. Within the Rebate Fund there shall be two accounts, an "Excess Earnings Account" and an "Income Account." Not more than 30 days following the end of each bond year (defined as a 12 -month period beginning March 1) and within 60 days after retirement of all of the bonds, the City shall determine, or cause to be determined, the Excess Earnings Amount (defined below) as of the most recent calculation date (defined as the last day of each bond year and the date on which the last bond is retired) and the applicable Income Amount (defined below). Following such determination, the City shall promptly take one or more of the following actions: (i) if the amount on deposit as of such calculation date in the Excess Earnings Account is less that the Excess Earnings Amount as of such calculation date, deposit to the Excess Earnings Account moneys in an amount calculated by the City as being sufficient to cause the amount on deposit in the Excess Earnings Account to be equal to the Excess Earnings Amount as of such calculation date; or (ii) if the amount on deposit in the Excess Earnings Account is greater than the Excess Earnings Amount as of such calculation date, transfer the amount of such excess to the Bond Fund: and (iii) deposit the Income Amount to the Income Account. 20 95 96 In order to make the deposits required by clauses (i) and (iii) above, the City shall promptly transfer moneys from any fund, including the Bond Fund, to the appropriate account of the Rebate Fund. 11.11 income earned on amounts on deposit in the Excess Earnings Account shall be deposited, as received, to the Income Account. All income earned on amounts on deposit in the Income Account shall be retained in the Income Account. In making the determination of the Excess Earnings Amount, the Income Amount and the Rebate Amount (defined below), the City may rely upon an opinion of nationally recognized bond counsel, or certified public accountants nationally recognized as having expertise with respect to such matters, to the effect that the method of calculation utilized by the City complies with the applicable provisions of the Code and the Regulations. At any relevant date, if then required by reason of Section 148(f) of the Code, the City shall remit to the United States Treasury, in such manner as may be required or permitted by the Code and the Regulations (including, without limitation, the information return filed pursuant to Section 149(c) of the Code), such amounts as are deposited in the Rebate Fund so that the interest on the bonds will not be includable in gross income for federal income tax purposes. Records of the determinations with respect to the Rebate Amount and the Rebate Fund shall be retained by the City until six years after the retirement of all of the bonds. As used in this subsection (e) : The term "Excess Earnings Amount" means, as of any calculation date, (a) the excess of (i) the aggregate amount earned (computed in accordance with the rules of Section 1.103- 15AT(d)(2) of the Regulations) from the issue date to such calculation date on all Nonpurpose Investments (other than Nonpurpose Investments held in the Rebate Fund) acquired with the Gross Proceeds of the bonds over (ii) the amount that would have been earned from the issue date to such Calculation Date if such Dlonpurpose Investments had been invested at a rate equal to the actual 'field (calculated in accordance with Section 1.103- 15AT(d)(2)(ii) of the Regulations) on the bonds from the issue date to such calculation date less (b) any Excess Earnings Amount previously paid to the United States of America as part of the Rebate Amount; provided that if the aggregate gross earnings (including investment income on such earnings) on Dlonpurpose Investments acquired with the Gross Proceeds of the bonds allocated to the Bond Fund do not exceed $100,000 in a bond year, such gross earnings during such bond year shall not be taken into account in calculating such Excess Earnings Amount. 21 M • • v v - 97 The term "Income F.mount" means, in the case of any bond year as of the close of which the Excess Earnings Amount is positive, that amount of income which is attributable to the lesser of (a) the Excess Earnings Amount as of the calculation date for that bond year, or (b) the amount by which such Excess Earnings Amount as of such calculation date in question exceeds the Excess Earnings Amount as of the calculation date for the preceding bond year, but in either case only to the extent that such income is earned from the close of the bond year in question to the date of the next transfer of amounts to the Excess Earnings Account required by this subsection. The term "Rebate Amount" means, as of any calculation date, the sum of (a) the Excess Earnings Amount plus (b) all amounts on deposit in the Income Account of the Rebate Fund, Section 17. Defeasance. When all of the bonds shall have been paid or deemed paid, the pledge in favor of the bonds shall be discharged and satisfied. A bond shall be deemed paid when there shall have been deposited in trust with the bond registrar and paying agent, as escrow agent under an escrow deposit agreement requiring the escrow agent to apply the proceeds of the deposit to pay the principal of and interest on the bond as due at maturity or upon redemption prior to maturity, moneys or Government Securities sufficient to pay when due the principal of and interest on the bond. If the principal of the bond is to become due by redemption prior to maturity, notice of such redemption must have been duly given or provided for. "Government Securities" shall mean direct or fully guaranteed obligations of the United States of America, noncallable, maturing on or prior to the maturity or redemption date of the Bond. In determining the sufficiency of a deposit there shall be considered the principal amount of such Government Securities and interest to be earned thereon until their maturity. Section 18. That the provisions of this Ordinance are separable and in the event that any section or part hereof shall be held to be invalid, such invalidity shall not affect the remainder of this Ordinance. Section 19. That all ordinances and resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. Section 20. That this Ordinance shall not create any right of any character and no right of any character shall arise under or pursuant to it until the bonds authorized by this Ordinance shall be issued and delivered. 22 w w w w w � w ■� �■ w� w w w w Section 21. That it is hereby ascertained and declared that there is an immediate and urgent need for the construction or acquisition of the various municipal projects to be financed by the issuance of the bonds above referred to in order to protect the health, lives and property of the inhabitants of the City. It is, therefore, declared that an emergency exists and this Ordinance, being necessary for the preservation of public peace, health and safety, shall take effect and be in force .immediatel7 upon and after its adoption. ADOPTED: February_l7_, 1988. APPROVED: ATTEST: Celz By . y r Lot ie ShacJ el£ord City lerk Sane zech 23 90