HomeMy WebLinkAbout20895 1 ORDINANCE NO. 20,895
2
3 AN ORDINANCE TO AUTHORIZE THE ISSUANCE OF HOTEL AND
4 RESTAURANT GROSS RECEIPTS TAX BONDS FOR THE PURPOSE
5 OF FINANCING ALL OR A PORTION OF THE COSTS OF CAPITAL
6 IMPROVEMENTS; TO PLEDGE COLLECTIONS OF A 2% HOTEL AND
7 RESTAURANT GROSS RECEIPTS TAX TO PAY THE PRINCIPAL OF
8 AND INTEREST ON THE BONDS; TO PRESCRIBE OTHER MATTERS
9 RELATING TO THE BONDS; TO DECLARE AN EMERGENCY; AND
10 FOR OTHER PURPOSES.
11
12 WHEREAS, there was submitted to the qualified electors of the City of Little Rock, Arkansas (the
13 "City")the question of issuing, under Amendment No. 62 to the Constitution of the State of Arkansas(the
14 "State") and under Title 14, Chapter 164, Subchapter 3 and Title 26, Chapter 75, Subchapter 6 of the
15 Arkansas Code of 1987 Annotated (the "Authorizing Legislation"), capital improvement bonds in the
16 maximum principal amount of$73,500,000 for the purpose of financing all or a portion of the costs of
17 renovations and additions to, and furnishings and equipment for, Robinson Auditorium (collectively, the
18 "Improvements"); and
19 WHEREAS, at the special election held December 10, 2013, a majority of the electors voting on the
20 question approved the issuance of such bonds; and
21 WHEREAS, the Board of Directors of the City and the City Advertising and Promotion Commission
22 (the "Commission"), which is the governing body of the Little Rock Convention and Visitors Bureau
23 ("LRCVB"), have determined that the Improvements are not general capital improvements within the
24 City but are for, or in direct support of, conventions, meetings and entertainment; and
25 WHEREAS, the Commission has determined to proceed with the Improvements and has
26 recommended that the City issue the capital improvement bonds approved at the election in the aggregate
27 principal amount of$66,180,000 designated as"City of Little Rock, Arkansas Hotel and Restaurant Gross
28 Receipts Tax Bonds, Series 2014"(the"bonds"); and
29 WHEREAS,the City has made arrangements for the sale of the bonds to Stephens Inc. and Crews &
30 Associates, Inc. (collectively, the "Purchaser"), at a price of $69,109,412.05 (principal amount less
31 underwriter's discount of $489,732 plus net original issue premium of $3,419,144.05), plus accrued
32 interest (the "Purchase Price"), pursuant to a Bond Purchase Agreement between the Purchaser and the
IPage 1 of 251
1 City (the "Purchase Agreement"), which has been exhibited to and is before the Board of Directors at the
2 meeting at which this ordinance is adopted; and
3 WHEREAS, the Commission has approved the pledging of the Pledged Revenues (defined in
4 Section 8 hereof)to the payment of the principal of and interest on the bonds; and
5 WHEREAS, the Preliminary Official Statement, dated June 12, 2014, offering the bonds for sale(the
6 "Preliminary Official Statement"), has been exhibited to and is before the Board of Directors at the
7 meeting at which this ordinance is adopted; and
8 WHEREAS, the Continuing Disclosure Agreement between the City and Simmons First Trust
9 Company, N.A., with offices in Pine Bluff, Arkansas (the "Trustee"), providing for the ongoing
10 disclosure obligations of the City with respect to the bonds (the "Disclosure Agreement"), has been
11 exhibited to and is before the Board of Directors at the meeting at which this ordinance is adopted; and
12 WHEREAS, the Build America Mutual Assurance Company (the "Reserve Insurer") will be issuing
13 a municipal bond debt service reserve insurance policy (the "Reserve Policy") in order to provide a debt
14 service reserve for the bonds; and
15 WHEREAS, the Debt Service Reserve Fund Agreement between the City and the Reserve Insurer
16 (the "Reserve Agreement") has been exhibited to and is before the Board of Directors at the meeting at
17 which this ordinance is adopted;
18 NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE CITY
19 OF LITTLE ROCK,ARKANSAS:
20 Section 1. The bonds are hereby sold to the Purchaser at the Purchase Price. The Purchase
21 Agreement, in substantially the form exhibited to this meeting, is approved. The Mayor is hereby
22 authorized and directed to execute and deliver the Purchase Agreement on behalf of the City and to take
23 all action required on the part of the City to fulfill its obligations under the Purchase Agreement.
24 Section 2. The Preliminary Official Statement is hereby approved and the previous use of the
25 Preliminary Official Statement by the Purchaser in connection with the sale of the bonds is hereby in all
26 respects approved and confirmed, and the Mayor is hereby authorized and directed, for and on behalf of
27 the City, to execute the Preliminary Official Statement and the final Official Statement in the name of the
28 City for use in connection with the sale of the bonds as set forth in the Purchase Agreement.
29 Section 3. The Disclosure Agreement, in substantially the form submitted to this meeting, is
30 approved, and the Mayor is hereby authorized and directed to execute and deliver the Disclosure
31 Agreement for and on behalf of the City. The Mayor and other officials of the City are authorized and
32 directed to take all action required on the part of the City to fulfill the City's obligations under the
33 Disclosure Agreement.
(Page 2 of 251
1 Section 4. Under the authority of the Constitution and laws of the State, including particularly
2 Amendment No. 62 to the Constitution of the State and the Authorizing Legislation, the bonds are hereby
3 authorized and ordered issued in the aggregate principal amount of$66,180,000, the proceeds of the sale
4 of which will be used to finance all or a portion of the costs of the Improvements, provide a debt service
5 reserve, and pay expenses of issuing the bonds. The bonds shall mature on July 1St in the years and in the
6 amounts and shall bear interest as follows:
7
Year Principal Interest
(July 1) Amount Rate
2015 $1,115,000 1.000%
2016 1,130,000 3.000
2017 1,160,000 3.000
2018 1,195,000 4.000
2019 1,245,000 5.000
2020 1,305,000 5.000
2021 1,370,000 5.000
2022 1,440,000 5.000
2023 1,510,000 5.000
2024 1,590,000 5.000
2025 1,670,000 4.000
2026 1,735,000 5.000
2027 1,820,000 5.000
2028 1,910,000 5.000
2029 2,010,000 5.000
2030 2,110,000 5.000
2034 9,545,000 5.000
2041 21,255,000 4.000
2044 11,065,000 4.125
8
9 The bonds shall be dated July 1, 2014, and shall be issuable only as fully registered bonds without
10 coupons in the denomination of$5,000 or any integral multiple thereof. Unless the City shall otherwise
11 direct, the bonds shall be numbered from 1 upward in order of issuance. Each bond shall have a CUSIP
12 number but the failure of a CUSIP number to appear on any bond shall not affect its validity.
[Page 3 of 251
1 The bonds shall be registered initially in the name of Cede & Co., as nominee for the Depository
2 Trust Company ("DTC"), which shall be considered to be the registered owner of the bonds for all
3 purposes under this Ordinance, including, without limitation, payment by the City of principal of,
4 redemption price, premium, if any, and interest on the bonds, and receipt of notices and exercise of rights
5 of registered owners. There shall be one certificated, typewritten bond for each stated maturity date
6 which shall be immobilized in the custody of DTC with the beneficial owners having no right to receive
7 the bonds in the form of physical securities or certificates. DTC and its participants shall be responsible
8 for maintenance of records of the ownership of beneficial interests in the bonds by book-entry on the
9 system maintained and operated by DTC and its participants, and transfers of ownership of beneficial
10 interests shall be made only by DTC and its participants, by book-entry, the City having no responsibility
11 therefor. DTC is expected to maintain records of the positions of participants in the bonds, and the
12 participants and persons acting through participants are expected to maintain records of the purchasers of
13 beneficial interests in the bonds. The bonds as such shall not be transferable or exchangeable, except for
14 transfer to another securities depository or to another nominee of a securities depository, without further
15 action by the City.
16 If any securities depository determines not to continue to act as a securities depository for the bonds
17 for use in a book-entry system, the City may establish a securities depository/ book-entry system
18 relationship with another securities depository. If the City does not or is unable to do so, or upon request
19 of the beneficial owners of all outstanding bonds, the City and the Trustee, after the Trustee has made
20 provision for notification of the beneficial owners by the then securities depository, shall permit
21 withdrawal of the bonds from the securities depository, and authenticate and deliver bond certificates in
22 fully registered form (in denominations of $5,000 or integral multiples thereof) to the assigns of the
23 securities depository or its nominee, all at the cost and expense (including costs of printing definitive
24 bonds) of the City, if the City fails to maintain a securities depository/book-entry system, or of the
25 beneficial owners, if they request termination of the system.
26 Prior to issuance of the bonds, the City shall have executed and delivered to DTC a written agreement
27 (the"Representation Letter") setting forth (or incorporating therein by reference)certain undertakings and
28 responsibilities of the City with respect to the bonds so long as the bonds or a portion thereof are
29 registered in the name of Cede & Co. (or a substitute nominee) and held by DTC. Notwithstanding such
30 execution and delivery of the Representation Letter, the terms thereof shall not in any way limit the
31 provisions of this Section or in any other way impose upon the City any obligation whatsoever with
32 respect to persons having interests in the bonds other than the registered owners, as shown on the
33 registration books kept by the Trustee. The Trustee shall take all action necessary for all representations
34 of the City in the Representation Letter with respect to the Trustee to at all times be complied with.
[Page 4 of 251
1 The authorized officers of the Trustee and the City shall do or perform such acts and execute all such
2 certificates, documents and other instruments as they or any of them deem necessary or advisable to
3 facilitate the efficient use of a securities depository for all or ally portion of the bonds; provided that
4 neither the Trustee nor the City may assume any obligations to such securities depository or beneficial
5 owners of bonds that are inconsistent with their obligations to any registered owner under this ordinance.
6 Interest on the bonds shall be payable on January 1, 2015, and semiannually thereafter on January 1st
7 and July 1st of each year. Payment of each installment of interest shall be made to the person in whose
8 name the bond is registered on the registration books of the City maintained by the Trustee, at the close of
9 business on the 15th day of the month (whether or not a business day) next preceding each interest
10 payment date (the "Record Date"), irrespective of any transfer or exchange of any such bond subsequent
11 to such Record Date and prior to such interest payment date, by check or draft mailed by the Trustee to
12 such owner at his address on such registration books. Principal of the bonds shall be payable at the
13 corporate trust office of the Trustee.
14 Each bond shall bear interest from the payment date next preceding the date on which it is
15 authenticated unless it is authenticated on an interest payment date, in which event it shall bear interest
16 from such date, or unless it is authenticated prior to the first interest payment date, in which event it shall
17 bear interest from July 1, 2014, or unless it is authenticated during the period from the Record Date to the
18 next interest payment date, in which case it shall bear interest from such interest payment date, or unless
19 at the time of authentication thereof interest is in default thereon, in which event it shall bear interest from
20 the date to which interest has been paid.
21 Only such bonds as shall have endorsed thereon a Certificate of Authentication substantially in the
22 form set forth in Section 6 hereof(the "Certificate") duly executed by the Trustee shall be entitled to any
23 right or benefit under this ordinance. No bond shall be valid and obligatory for any purpose unless and
24 until the Certificate shall have been duly executed by the Trustee, and the Certificate of the Trustee upon
25 any such bond shall be conclusive evidence that such bond has been authenticated and delivered under
26 this ordinance. The Certificate on any bond shall be deemed to have been executed if signed by an
27 authorized officer of the Trustee, but it shall not be necessary that the same officer sign the Certificate on
28 all of the bonds.
29 In case any bond shall become mutilated or be destroyed or lost, the City shall, if not then prohibited
30 by law, cause to be executed and the Trustee may authenticate and deliver a new bond of like date,
31 maturity and tenor in exchange and substitution for and upon cancellation of such mutilated bond, or in
32 lieu of and in substitution for such bond destroyed or lost, upon the owner paying the reasonable expenses
33 and charges of the City and Trustee in connection therewith, and, in the case of a bond destroyed or lost,
34 his filing with the Trustee evidence satisfactory to it that such bond was destroyed or lost, and of his
[Page 5 of 251
1 ownership thereof, and furnishing the City and Trustee with indemnity satisfactory to them. The Trustee
2 is hereby authorized to authenticate any such new bond. In the event any such bond shall have matured,
3 instead of issuing a new bond, the City may pay the same without the surrender thereof. Upon the
4 issuance of a new bond under this Section, the City may require the payment of a sum sufficient to cover
5 any tax or other governmental charge that may be imposed in relation thereto and any other expenses
6 (including the fees and expenses of the Trustee)connected therewith.
7 The City shall cause books to be maintained for the registration and for the transfer of the bonds as
8 provided herein and in the bonds. The Trustee shall act as the bond registrar. Each bond is transferable
9 by the registered owner thereof or by his attorney duly authorized in writing at the principal office of the
10 Trustee. Upon such transfer a new fully registered bond or bonds of the same maturity, of authorized
11 denomination or denominations, for the same aggregate principal amount will be issued to the transferee
12 in exchange therefor.
13 Bonds may be exchanged at the principal corporate trust office of the Trustee for an equal aggregate
14 principal amount of bonds of any other authorized denomination or denominations. The City shall
15 execute and the Trustee shall authenticate and deliver bonds which the registered owner making the
16 exchange is entitled to receive. The execution by the City of any bond of any denomination shall
17 constitute full and due authorization of such denomination and the Trustee shall be thereby authorized to
18 authenticate and deliver such bond.
19 No charge shall be made to any owner of any bond for the privilege of transfer or exchange, but any
20 owner of any bond requesting any such transfer or exchange shall pay any tax or other governmental
21 charge required to be paid with respect thereto. Except as otherwise provided in the immediately
22 preceding sentence, the cost of preparing each new bond upon each exchange or transfer and any other
23 expenses of the City or the Trustee incurred in connection therewith shall be paid by the City. Neither the
24 Trustee nor the City shall be required to transfer or exchange any bonds selected for redemption in whole
25 or in part.
26 The person in whose name any bond shall be registered shall be deemed and regarded as the absolute
27 owner thereof for all purposes, and payment of or on account of the principal or premium, if any, or
28 interest on any bond shall be made only to or upon the order of the registered owner thereof or his legal
29 representative, but such registration may be changed as hereinabove provided. All such payments shall
30 be valid and effectual to satisfy and discharge the liability upon such bond to the extent of the sum or
31 sums so paid.
32 In any case where the date of maturity of interest on or principal of the bonds or the date fixed for
33 redemption of any bonds shall be a Saturday or Sunday or shall be in the State a legal holiday or a day on
34 which banking institutions are authorized by law to close, then payment of interest or principal need not
[Page 6 of 251
1 be made on such date but may be made on the next succeeding business day with the same force and
2 effect as if made on the date of maturity or the date fixed for redemption, and no interest shall accrue for
3 the period after the date of maturity or date fixed for redemption.
4 Section 5. The bonds shall be executed on behalf of the City by the manual or facsimile signatures
5 of the Mayor and City Clerk and shall have impressed or imprinted thereon the seal of the City.
6 Section 6. The bonds and the Certificate shall be in substantially the following form and the Mayor
7 and City Clerk are hereby expressly authorized and directed to make all recitals contained therein:
8 (Form of Bond)
9
10 REGISTERED REGISTERED
11
12 No. $
13
14 UNITED STATES OF AMERICA
15 STATE OF ARKANSAS
16 COUNTY OF PULASKI
17 CITY OF LITTLE ROCK
18 HOTEL AND RESTAURANT GROSS
19 RECEIPTS TAX BOND
20 SERIES 2014
21
22 Interest Rate: % Maturity Date: July 1,
23 Dated Date: July 1, 2014
24 Registered Owner: Cede &Co.
25 Principal Amount: Dollars
26 CUSIP No.:
27
28 KNOW ALL MEN BY THESE PRESENTS:
29
30 That the City of Little Rock, County of Pulaski, State of Arkansas (the "City"),
31 for value received, hereby promises to pay to the Registered Owner shown above
32 upon the presentation and surrender hereof at the principal office of Simmons First
33 Trust Company, N.A., with offices in Pine Bluff, Arkansas, or its successor or
34 successors, as Trustee and Paying Agent (the "Trustee"), on the Maturity Date
(Page 7 of 251
1 shown above, the Principal Amount shown above, in such coin or currency of the
2 United States of America as at the time of payment shall be legal tender for the
3 payment of public and private debts and to pay by check or draft to the Registered
4 Owner shown above interest thereon, in like coin or currency from the interest
5 commencement date described below at the Interest Rate per annum shown above,
6 payable on January 1, 2015, and on each January 1st and July 1st thereafter, until
7 payment of such Principal Amount or, if this bond or a portion hereof shall be duly
8 called for redemption, until the date fixed for redemption, and to pay interest on
9 overdue principal and interest (to the extent legally enforceable) at the rate borne
10 by this bond. Payment of each installment of interest shall be made to the person
11 in whose name this bond is registered on the registration books of the City
12 maintained by the Trustee at the close of business on the 15th day of the month
13 (whether or not a business day) next preceding each interest payment date (the
14 "Record Date"), irrespective of any transfer or exchange of this bond subsequent to
15 such Record Date and prior to such interest payment date.
16
17 Unless this bond is presented by an authorized representative of The
18 Depository Trust Company, a New York corporation ("DTC"), to the Trustee for
19 registration of transfer, exchange or payment, and any certificate issued is
20 registered in the name of Cede & Co. or in such other name as is requested by an
21 authorized representative of DTC (and any payment is made to Cede & Co. or to
22 such other entity as is required by an authorized representative of DTC), ANY
23 TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
24 OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
25 registered owner hereof, Cede&Co., has an interest herein.
26
27 This bond shall bear interest from the payment date next preceding the date on
28 which it is authenticated unless it is authenticated on an interest payment date, in
29 which event it shall bear interest from such date, or unless it is authenticated
30 during the period from the Record Date to the next interest payment date, in which
31 case it shall bear interest from such interest payment date, or unless it is
32 authenticated prior to the first interest payment date, in which event it shall bear
33 interest from the Dated Date shown above, or unless at the time of authentication
[Page 8 of 251
1 hereof interest is in default hereon, in which event it shall bear interest from the
2 date to which interest has been paid.
3
4 This bond is one of an issue of City of Little Rock, Arkansas Hotel and
5 Restaurant Gross Receipts Tax Bonds, Series 2014, aggregating Sixty-Six Million
6 One Hundred Eighty Thousand Dollars ($66,180,000) in aggregate principal
7 amount (the "bonds"), and is issued for the purpose of financing all or a portion of
8 the costs of renovations and additions to, and furnishings and equipment for,
9 Robinson Auditorium, providing a debt service reserve and paying expenses of
10 authorizing and issuing the bonds.
11
12 The bonds are issued pursuant to and in full compliance with the Constitution
13 and laws of the State of Arkansas (the"State"), particularly Amendment No. 62 to
14 the Constitution of the State and Title 14, Chapter 164, Subchapter 3 and Title 26,
15 Chapter 75, Subchapter 6 of the Arkansas Code of 1987 Annotated (the
16 "Authorizing Legislation"), and pursuant Ordinance No. 20,895, duly adopted on
17 June 17, 2014 (the "Authorizing Ordinance"), and an election duly held at which
18 the majority of the legal voters of the City voting on the question approved the
19 issuance of the bonds. Reference is hereby made to the Authorizing Ordinance for
20 the details of the nature and extent of the security and of the rights and obligations
21 of the City, the Trustee and the registered owners of the bonds. The bonds are
22 special obligations of the City, payable from collections of the 2% tax levied by
23 the City upon the gross receipts or gross proceeds from motels, hotels, restaurants,
24 cafes, cafeterias and all other establishments engaged in the business of selling
25 prepared food for consumption on the premises of such establishment under Title
26 26, Chapter 75, Subchapter 6 of the Arkansas Code of 1987 Annotated and
27 Ordinance No. 12,353 of the City duly adopted on May 4, 1970, and Ordinance
28 No. 13,527 of the City duly adopted on November 7, 1978, each as amended by
29 Ordinance No. 17,100, duly adopted on January 16, 1996 (the "Tax"), and the City
30 hereby pledges its collections of the Tax for the payment of this bond.
31
32 The bonds are subject to extraordinary, optional and mandatory sinking fund
33 redemption prior to maturity as follows:
34
(Page 9 of 251
1 (1) The bonds shall be redeemed by the City from proceeds of the bonds not
2 needed for the purposes intended, in whole or in part on any interest payment date,
3 at a redemption price equal to the principal amount being redeemed plus accrued
4 interest to the redemption date, and if in part, in inverse order of maturity (and by
5 lot within a maturity in such manner as the Trustee may determine).
6
7 (2) The bonds may be redeemed at the option of the City, from funds from
8 any source, on and after July 1, 2024, in whole at any time, or in part on any
9 interest payment date, at a redemption price equal to the principal amount being
10 redeemed plus accrued interest to the redemption date. If fewer than all of the
11 bonds shall be called for redemption, the particular maturities of the bonds to be
12 redeemed shall be selected by the City in its discretion. If fewer than all of the
13 bonds of any one maturity shall be called for redemption, the particular bonds or
14 portion thereof to be redeemed from such maturity shall be selected by lot by the
15 Trustee.
16
17 (3) To the extent not previously redeemed, the bonds maturing on July 1,
18 2034, 2041 and 2044, are subject to mandatory sinking fund redemption by lot in
19 such manner as the Trustee shall determine, on July 1St in the years and in the
20 amounts set forth below, at a redemption price equal to the principal amount being
21 redeemed plus accrued interest to the date of redemption:
22 Bonds Maturing July 1, 2034
23
Year Principal
(July 1) Amount
2031 $2,215,000
2032 2,325,000
2033 2,440,000
2034 (maturity) 2,565,000
24
25 Bonds Maturing July 1, 2041
26
Year Principal
[Page 10 of 251
(July 1) Amount
2035 $2,690,000
2036 2,800,000
2037 2,910,000
2038 3,025,000
2039 3,150,000
2040 3,275,000
2041 (maturity) 3,405,000
1 Bonds Maturing July 1, 2044
2
Year Principal
(July 1) Amount
2042 $3,540,000
2043 3,685,000
2044 (maturity) 3,840,000
3
4 In case any outstanding bond is in a denomination greater than $5,000, each
5 $5,000 of face value of such bond shall be treated as a separate bond of the
6 denomination of$5,000.
7 Notice of redemption identifying the bonds or portions thereof(which shall be
8 $5,000 or a multiple thereof) to be redeemed and the date they shall be presented
9 for payment shall be given by the Trustee, not less than 30 nor more than 60 days
10 prior to the date fixed for redemption, by mailing a copy of the redemption notice
11 by first class mail, postage prepaid, to all registered owners of bonds to be
12 redeemed. Failure to mail an appropriate notice or any such notice to one or more
13 registered owners of bonds to be redeemed shall not affect the validity of the
14 proceedings for redemption of other bonds as to which notice of redemption is
15 duly given in proper and timely fashion. All such bonds or portions thereof thus
16 called for redemption and for the retirement of which funds are duly provided in
17 accordance with the Authorizing Ordinance prior to the date fixed for redemption
18 will cease to bear interest on such redemption date.
(Page 11 of 251
1 This bond is transferable by the Registered Owner shown above in person or
2 by his attorney-in-fact duly authorized in writing at the principal corporate trust
3 office of the Trustee, but only in the manner, subject to the limitations and upon
4 payment of the charges provided in the Authorizing Ordinance, and upon surrender
5 and cancellation of this bond. Upon such transfer a new fully registered bond or
6 bonds of the same maturity, of authorized denomination or denominations, for the
7 same aggregate principal amount, will be issued to the transferee in exchange
8 therefor. This bond is issued with the intent that the laws of the State shall govern
9 its construction.
10 The City and the Trustee may deem and treat the Registered Owner shown
11 above as the absolute owner hereof for the purpose of receiving payment of or on
12 account of principal hereof and interest due hereon and for all other purposes, and
13 neither the City nor the Trustee shall be affected by any notice to the contrary.
14 The bonds are issuable only as fully registered bonds in the denomination of
15 $5,000, and any integral multiple thereof. Subject to the limitations and upon
16 payment of the charges provided in the Authorizing Ordinance, fully registered
17 bonds may be exchanged for a like aggregate principal amount of fully registered
18 bonds of the same maturity of other authorized denominations.
19 IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts,
20 conditions and things required to exist, happen and be performed, under the
21 Constitution and laws of the State, particularly Amendment No. 62 to the
22 Constitution of the State and the Authorizing Legislation, precedent to and in the
23 issuance of this bond have existed, have happened and have been performed in due
24 time, form and manner as required by law; that the indebtedness represented by
25 this bond and the issue of which it forms a part does not exceed any constitutional
26 or statutory limitation; and that tax revenues sufficient to pay the bonds and
27 interest thereon have been duly pledged in accordance with the Authorizing
28 Legislation for the payment of the bonds and interest thereon.
29 This bond shall not be valid until it shall have been authenticated by the
30 Certificate hereon duly signed by the Trustee.
31 IN WITNESS WHEREOF, the City of Little Rock, Arkansas has caused this
32 bond to be executed by its Mayor and City Clerk and its corporate seal to be
33 impressed or imprinted on this bond, all as of the Dated Date shown above.
34
[Page 12 of 251
1 CITY OF LITTLE ROCK, ARKANSAS
2
3 By
4 Mayor
5 ATTEST:
6
7 City Clerk
8 (SEAL)
9
10 (Form of Trustee's Certificate)
11 TRUSTEE'S CERTIFICATE OF AUTHENTICATION
12 This bond is one of the bonds issued under the provisions of the within
13 mentioned Authorizing Ordinance.
14 Date of Authentication:
15 SIMMONS FIRST TRUST COMPANY,N.A.
16 TRUSTEE
17
18 By
19 Authorized Signature
20 (A Form of Assignment shall be attached to the bonds.)
21 Section 7. The City hereby expressly pledges and appropriates collections of the 2% tax levied by
22 the City pursuant to Title 26, Chapter 75, Subchapter 6 of the Arkansas Code of 1987 Annotated and
23 Ordinance No. 12,353, adopted May 4, 1970, and Ordinance No. 13,527, adopted November 7, 1978,
24 each as amended by Ordinance No. 17,100, adopted January 16, 1996, on the gross receipts or gross
25 proceeds from motels, hotels, restaurants, cafes, cafeterias and establishments engaged in the business of
26 selling prepared food for consumption on the premises of such establishment (the "Tax"), to the payment
27 of the principal of and interest on the bonds when due at maturity or at redemption prior to maturity, and
28 to the payment of the Trustee's fees and expenses, any required arbitrage rebate due to the United States
29 and any fees or other amounts due the Reserve Insurer. The City covenants that the Tax shall never be
30 repealed or reduced while any of the bonds are outstanding or while any amounts are due and payable to
31 the Reserve Insurer. The City further covenants to use due diligence in collecting the Tax. Nothing
32 herein shall prohibit the City from increasing the Tax from time to time, to the extent permitted by law,
33 and no part of the revenues derived from any such increase shall become part of the revenues pledged
34 hereunder.
(Page 13 of 251
1 Section 8.
2 (a)There is hereby created in a bank selected by the Commission that is a member of the Federal
3 Deposit Insurance Corporation ("FDIC") a special fund of the City designated as the "Hotel and
4 Restaurant Gross Receipts Tax Revenue Fund"(the"Revenue Fund").
5 (b) On and after the date the bonds are issued, the Senior Vice President of Finance and
6 Administration of LRCVB shall deposit all collections of the Tax (the "Pledged Revenues") as and when
7 received into the Revenue Fund.
8 (c) Except as provided in (d) below, on or before the 25th day of each month, commencing in
9 July 2014, the Senior Vice President of Finance and Administration of the LRCVB shall deposit from the
10 Revenue Fund the following amounts into the following accounts in the following order of priority:
11 (1) 1/6 of the interest on the bonds next due- Debt Service Account in the Bond Fund;
12 (2) 1/12 of the principal of the bonds next due at maturity or upon mandatory sinking fund
13 redemption - Debt Service Account in the Bond Fund;
14 (3) the amount, if any, which may be necessary to reimburse the Reserve Insurer with respect
15 to the Reserve Policy and to fund and maintain the Debt Service Reserve Fund (hereinafter identified) at
16 any required level - Debt Service Reserve Fund;
17 (4) the Trustee's fees and expenses and other administrative charges next due, any arbitrage
18 rebate due the United States Treasury under Section 148(f) of the Internal Revenue Code of 1986, as
19 amended (the "Code"), and the fees for any arbitrage rebate calculation - Expense Account in the Bond
20 Fund; and
21 (5) any remaining amounts shall be used to cover any deficiency in the monthly transfers
22 required by(1)through (4)above for any previous month.
23 The transfers made into the Debt Service Account in the Bond Fund shall be reduced in order to take into
24 account as a credit(1) interest earnings, (2) accrued interest deposited therein from bond proceeds and (3)
25 transfers from the Debt Service Reserve Fund.
26 (d) Anything herein to the contrary notwithstanding, the Senior Vice President of Finance and
27 Administration of LRCVB shall transfer from the Revenue Fund into the Bond Fund not less than five(5)
28 business days before each January 1st and July 15', an amount, in addition to other moneys in the Bond
29 Fund,that will be sufficient to cause the Bond Fund to have moneys to pay the principal of and interest on
30 the bonds on the next due date thereof.
31 (e) After making the monthly deposits as set forth above, all amounts in the Revenue Fund shall
32 be transferred to the Advertising and Promotion Fund and be used for any lawful purpose.
33
34
[Page 14 of 251
1 Section 9.
2 (a) There is hereby created a special fund of the City in the Trustee which is designated "Hotel
3 and Restaurant Gross Receipts Tax Bond Fund" (the "Bond Fund"), for the purpose of providing funds
4 for the payment of principal of and interest on the bonds as they become due at maturity or at redemption
5 prior to maturity, any arbitrage rebate, the fees for the arbitrage rebate calculation and the Trustee's fees
6 and expenses. There shall be established in the Bond Fund the following accounts into which moneys
7 from the Revenue Fund shall be deposited monthly: (i) Debt Service Account; (ii) Redemption Account;
8 and (iii) Expense Account. Moneys in the Bond Fund shall be used on each interest payment date in the
9 following order of priority as and when necessary:
10 (1) to pay the interest on the bonds then due - Debt Service Account;
11 (2) to pay the principal of the bonds then due at maturity or upon mandatory sinking fund
12 redemption-Debt Service Account;
13 (3) to pay the Trustee's fees and expenses and other administrative charges, any arbitrage
14 rebate and the fees for the arbitrage rebate calculation then due - Expense Account; and
15 (4) to redeem bonds prior to maturity - Redemption Account.
16 (b) When the moneys in the Bond Fund shall be and remain sufficient to pay (1)the principal of
17 all the bonds then outstanding, (2) interest on the bonds until the next interest payment date and (3) the
18 Trustee's fees and expenses, there shall be no obligation to make any further payments into the Bond
19 Fund and any Pledged Revenues remaining in the Bond Fund after the principal of, premium, if any and
20 interest on the bonds have been paid shall be used to reimburse the Reserve Insurer for any amounts
21 owing with respect to the Reserve Policy and the balance shall be transferred to the Advertising and
22 Promotion Fund and be used for any lawful purposes.
23 (c) All moneys in the Bond Fund shall be used solely for the purpose of paying the principal of
24 and interest on the bonds, as the same become due, and for the other purposes set forth in this Section 9.
25 The Trustee is authorized and directed to withdraw moneys from the Bond Fund from time to time as
26 necessary for paying principal of and interest on the bonds when due at maturity or at redemption prior to
27 maturity and for making other authorized Bond Fund expenditures.
28 (d) The Trustee shall deposit moneys into the Redemption Account in accordance with Section
29 18 of this Ordinance and any amounts instructed by the City to be deposited therein for the purpose of
30 optionally redeeming the bonds prior maturity. The Trustee shall use moneys in the Redemption Account
31 to redeem the bonds.
32 (e) All moneys in the Expense Account in the Bond Fund shall be used to pay the Trustee's fees
33 and expenses and other administrative charges, any arbitrage rebate and the fees for calculating arbitrage
34 rebate.
1 Page 15 of 251
1 (f) The bonds shall be specifically secured by a pledge of the Pledged Revenues, which pledge in
2 favor of the bonds is hereby irrevocably made according to the terms of this Ordinance, and the City, and
3 the officers and employees of the City, including, without limitation, the Commission, shall execute,
4 perform and carry out the terms thereof in strict conformity with the provisions of this ordinance.
5 Section 10. There is hereby created a special fund in the name of the City in the Trustee which is
6 designated "Hotel and Restaurant Gross Receipts Tax Debt Service Reserve Fund" (the "Debt Service
7 Reserve Fund"). There shall be established in the Debt Service Reserve Fund a Series 2014 Reserve
8 Account into which shall be deposited the Reserve Policy in an amount equal to one-half of the maximum
9 annual principal and interest requirements on the bonds. The Series 2014 Reserve Account in the Debt
10 Service Reserve Fund shall only secure the bonds. Moneys in the Series 2014 Reserve Account in the
11 Debt Service Reserve Fund shall be used to make the payments described in clauses(1)and(2)of Section
12 9 above with respect to the bonds if moneys in the Debt Service Account in the Bond Fund are not
13 otherwise sufficient for that purpose. The City may establish an account or accounts in the Debt Service
14 Reserve Fund to separately secure Additional Parity Bonds (hereinafter defined), and not the bonds, in an
15 amount not to exceed one-half of the maximum annual principal and interest requirements on such
16 Additional Parity Bonds. Other accounts in the Debt Service Reserve Fund may be established with cash,
17 a surety bond or a debt service reserve insurance policy.
18 Section 11.Notwithstanding any provision of this ordinance to the contrary:
19 (a) In the event that payment is required under the Reserve Policy, the Trustee shall ascertain the
20 necessity for a claim under the Reserve Policy in accordance with subsection (b) below and provide
21 notice to the Reserve Insurer in accordance with the terms of the Reserve Policy at least five (5) business
22 days prior to each date upon which principal or interest is due on the bonds. Simultaneously with the
23 giving of notice to the Reserve Insurer, the Trustee shall also send notice to the Commission. All draws
24 on the Reserve Policy may only be used to make payments on the bonds.
25 (b) From the Pledged Revenues and in accordance with the provisions of this Ordinance and the
26 Reserve Agreement, the City shall repay any draws under the Reserve Policy and pay all related
27 reasonable expenses incurred by the Reserve Insurer. Interest shall accrue and be payable on such draws
28 and expenses from the date of payment by the Reserve Insurer at the Late Payment Rate. "Late Payment
29 Rate" means the lesser of(x) the greater of(i) the per annum rate of interest, publicly announced from
30 time to time by JPMorgan Chase Bank at its principal office in the City of New York, as its prime or base
31 lending rate ("Prime Rate") (any change in such Prime Rate to be effective on the date such change is
32 announced by JP Morgan Chase Bank) plus 5%, and (ii)the then applicable highest rate of interest on the
33 bonds and (y)the maximum rate permissible under applicable usury or similar laws limiting interest rates.
34 The Late Payment Rate shall be computed on the basis of the actual number of days elapsed over a year
[Page 16 of 251
1 of 360 days. In the event JPMorgan Chase Bank ceases to announce its Prime Rate publicly, Prime Rate
2 shall be the publicly announced prime or base lending rate of such bank, banking association or trust
3 company bank as the Reserve Insurer in its sole and absolute discretion shall specify.
4 Repayment of draws and payment of expenses and accrued interest thereon at the Late Payment
5 Rate(collectively, "Policy Costs") shall commence in the first month following each draw, and each such
6 monthly payment shall be in an amount at least equal to 1/12 of the aggregate of Policy Costs related to
7 such draw.
8 Amounts in respect of Policy Costs paid to the Reserve Insurer shall be credited first to interest due,
9 then to the expenses due and then to principal due. As and to the extent that payments are made to the
10 Reserve Insurer on account of principal due, the coverage under the Reserve Policy will be increased by a
11 like amount, subject to the terms of the Reserve Policy.
12 Any cash and investments in the Series 2014 Reserve Account of the Debt Service Reserve Fund
13 shall be transferred to the Bond Fund for payment of debt service on the bonds before any drawing may
14 be made on the Reserve Policy. Payment of any Policy Costs shall be made prior to replenishment of any
15 cash drawn from the Series 2014 Reserve Account of the Debt Service Reserve Fund.
16 (c) Upon a failure of the City to pay Policy Costs when due in accordance with the requirements
17 of subsection (b) above, the Reserve Insurer shall be entitled to exercise any and all legal and equitable
18 remedies available to it, including those provided under this ordinance.
19 (d) This ordinance shall not be discharged until all Policy Costs owing to the Reserve Insurer
20 shall have been paid in full. The City's obligation to pay such amount shall expressly survive payment in
21 full of the bonds.
22 (e) The Reserve Policy shall expire and terminate in accordance with the terms and provisions of
23 the Reserve Policy and the Reserve Agreement.
24 (f) Any amendment, supplement, modification to, or waiver of this ordinance that requires the
25 consent of the owners of the bonds or adversely affects the rights or interest of the Reserve Insurer shall
26 be subject to the prior written consent of the Reserve Insurer.
27 (g) The Reserve Insurer is recognized as and shall be deemed to be a third party beneficiary of
28 this Ordinance and may enforce the provisions of this ordinance as if it were a party thereto.
29 (h) Policy Costs due and owing shall be included in debt service requirements for purposes of
30 calculation of the additional bonds test in Section 13 of this ordinance.
31 (i) The City will provide the Reserve Insurer with all notices and other information it is
32 obligated to provide(i) under the Disclosure Agreement and (ii)to the owners of the bonds or the Trustee
33 under this ordinance.
'Page 17 of 251
1 (j) The City shall provide the Reserve Insurer with the following notices and other information:
2 (i) notice of any draw upon the Debt Service Reserve Fund within two (2) business days after knowledge
3 thereof,other than in connection with withdrawals of amounts in excess of the required level therefor; and
4 (ii) prior written notice of the advance refunding or redemption of any of the bonds, including the
5 principal amount, maturities and CUSIP numbers thereof.
6 (k) Notices and other information to the Reserve Insurer shall be sent to the following address(or
7 such other address as the Reserve Insurer may designate in writing):
8 Build America Mutual Assurance Company
9 I World Financial Center,27th Floor
10 200 Liberty Street,New York,NY 10281
11 Attention: Surveillance, Re: Policy No.
12 Telephone: (212)235-2500
13 Telecopier: (212)235-1542
14 Email: notices@buildamerica.com
15 Section 12. Any bond shall be deemed to be paid within the meaning of this ordinance when
16 payment of the principal of and interest on such bond (whether at maturity or upon redemption as
17 provided herein, or otherwise), either (i) shall have been made or caused to be made in accordance with
18 the terms thereof, or (ii) shall have been provided for by irrevocably depositing with the Trustee, in trust
19 and irrevocably set aside exclusively for such payment (1) moneys sufficient to make such payment
20 and/or (2) direct obligations of the United States of America ("Government Securities") that are
21 noncallable, maturing as to principal and interest in such amounts and at such times as will provide
22 sufficient moneys to make such payment, and all necessary and proper fees, compensation and expenses
23 of the Trustee with respect to which such deposit is made shall have been paid or the payment thereof
24 provided for to the satisfaction of the Trustee. All moneys must be insured at all times by the FDIC or
25 otherwise collateralized with Government Securities.
26 On the payment of any bonds within the meaning of this ordinance, the Trustee shall hold in trust, for
27 the benefit of the owners of such bonds, all such moneys and/or Government Securities.
28 When all the bonds shall have been paid within the meaning of this ordinance and if the Trustee has
29 been paid its fees and expenses, if any required arbitrage rebate payment has been made to the United
30 States under Section 148(f) of the Code or provision made therefor, and if there are not amounts due the
31 Reserve Insurer with respect to the Reserve Policy, the Trustee shall take all appropriate action to cause
32 (i) the pledge and lien of this Ordinance to be discharged and cancelled, and (ii) all moneys held by it
33 pursuant to this Ordinance and which are not required for the payment of such bonds to be paid over or
34 delivered to or at the direction of the Commission for deposit into the Advertising and Promotion Fund.
[Page 18 of 251
1 Section 13. The City covenants that it will not issue any bonds, or incur any obligation, secured by a
2 lien on or pledge of Pledged Revenues, except as hereinafter provided. The City may issue additional
3 bonds secured by a pledge of the Pledged Revenues on a parity with the pledge in favor of the bonds
4 ("Additional Parity Bonds") so long as the City has received collections of Pledged Revenues for a 12
5 month period that ends not less than thirty (30) and not more than ninety (90) days prior to the date that
6 the Additional Parity Bonds are authorized by the Board of Directors of the City to be issued, in an
7 amount equal to or in excess of 150%of the maximum annual debt service requirement for the bonds,any
8 outstanding Additional Parity Bonds and the Additional Parity Bonds proposed to be issued.
9 The City may issue bonds or incur obligations secured by a lien on and pledge of Pledged Revenues
10 subordinate to the lien and pledge in favor of the bonds.
11 Section 14. The bonds shall be callable for payment prior to maturity in accordance with the terms set
12 out in the face of the bond form set forth in Section 6 of this ordinance. The City hereby covenants to use
13 bond proceeds not necessary for the purposes intended to redeem bonds on the first available interest
14 payment date.
15 Section 15. It is hereby covenanted and agreed by the City with the owners of the bonds that the City
16 and the Commission will faithfully and punctually perform all duties with reference to the Tax and the
17 bonds required by the Constitution and laws of the State and by this ordinance, including the collection of
18 the Tax, as herein specified and covenanted and the applying of the Pledged Revenues as herein provided.
19 Section 16. The Commission will keep or cause to be kept proper books of accounts and records in
20 which complete and correct entries shall be made of all transactions relating to the Pledged Revenues
21 prior to their deposit into the Advertising and Promotion Fund and such books shall be available for
22 inspection by the Trustee, the Purchaser and the owner of any of the bonds at reasonable times and under
23 reasonable circumstances. Upon the written request by the Trustee, the Commission shall furnish a report
24 to the Trustee on a monthly basis of all receipts and transfers of the Pledged Revenues received by the
25 Commission. The Trustee shall provide the Commission with a monthly report of all transactions relating
26 to the Bond Fund and the Construction Fund(hereinafter identified).
27 Section 17.
28 (a) If there be any default in the payment of the principal of and interest on any of the bonds or if
29 the City defaults in the performance of any covenant contained in this Ordinance or if the City declares
30 bankruptcy, the Trustee may, and shall, upon the written request of the owners of not less than 10% in
31 principal amount of the bonds then outstanding, by proper suit compel the performance of the duties of
32 the officials of the City and the Commission under the Constitution and laws of the State and under this
33 ordinance, and to take any action or obtain any proper relief in law or equity available under the
34 Constitution and laws of the State.
[Page 19 of 251
1 (b) No owner of any bond shall have any right to institute any suit, action, mandamus or other
2 proceeding in equity or in law for the protection or enforcement of any right under this ordinance or under
3 the Constitution and laws of the State unless such owner previously shall have given to the Trustee
4 written notice of the default on account of which such suit, action or proceeding is to be taken, and unless
5 the owners of not less than 10% in principal amount of the bonds then outstanding shall have made
6 written request of the Trustee after the right to exercise such powers or right of action, as the case may be,
7 shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to
8 exercise the powers herein granted or granted by the Constitution and laws of the State, or to institute
9 such action, suit or proceeding in its name, and unless, also, there shall have been offered to the Trustee
10 reasonable security and indemnity against the cost, expense and liabilities to be incurred therein or
11 thereby and the Trustee shall have refused or neglected to comply with such request within a reasonable
12 time, and such notification, request and offer of indemnity are hereby declared in every such case, at the
13 option of the Trustee,to be conditions precedent to the execution of the powers and trust of this ordinance
14 or to any other remedy hereunder. It is understood and intended that no one or more owners of the bonds
15 shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the
16 security of this ordinance, or to enforce any right hereunder except in the manner herein provided, that all
17 proceedings at law or in equity shall be instituted, had and maintained in the manner herein provided and
18 for the benefit of all owners of the outstanding bonds, and that any individual rights of action or other
19 right given to one or more of such owners by law are restricted by this ordinance to the rights and
20 remedies herein provided.
21 (c) All rights of action under this ordinance or under any of the bonds, enforceable by the
22 Trustee, may be enforced by it without the possession of any of the bonds, and any such suit, action or
23 proceeding instituted by the Trustee shall be brought in its name and for the benefit of all the owners of
24 the bonds, subject to the provisions of this ordinance.
25 (d) No remedy herein conferred upon or reserved to the Trustee or to the owners of the bonds is
26 intended to be exclusive of any other remedy or remedies herein provided, and each and every such
27 remedy shall be cumulative and shall be in addition to every other remedy given hereunder or given by
28 any law or by the Constitution of the State.
29 (e) No delay or omission of the Trustee or of any owners of the bonds to exercise any right or
30 power accrued upon any default shall impair any such right or power or shall be construed to be a waiver
31 of any such default or an acquiescence therein, and every power and remedy given by this ordinance to
32 the Trustee and to the owners of the bonds, respectively, may be exercised from time to time and as often
33 as may be deemed expedient.
[Page 20 of 251
1 (f) The Trustee may, and upon the written request of the owners of not less than a majority of the
2 owners in principal amount of the bonds then outstanding shall, waive any default which shall have been
3 remedied before the entry of final judgment or decree in any suit, action or proceeding instituted under the
4 provisions of this ordinance or before the completion of the enforcement of any other remedy, but no such
5 waiver shall extend to or affect any other existing or any subsequent default or defaults or impair any
6 rights or remedies consequent thereon.
7 Section 18. When the bonds have been executed and sealed as herein provided, they shall be
8 delivered to the Trustee, which shall authenticate them and deliver them to or at the direction of the
9 Purchaser upon payment of the Purchase Price. The accrued interest shall be deposited in the Bond Fund.
10 Unless paid by the Purchaser as part of the Purchase Price, the amount necessary to pay the premium for
11 the Reserve Policy shall be paid to the Reserve Insurer. The expenses of issuing the bonds as set forth in
12 the delivery instructions to the Trustee signed by the Mayor and City Clerk shall be paid from the
13 Purchase Price.
14 The balance of the Purchase Price shall be deposited in a special account of the City hereby created
15 and designated the "2014 Robinson Auditorium Construction Fund" (the "Construction Fund") in the
16 Trustee. The moneys in the Construction Fund shall be used for accomplishing the Improvements, paying
17 expenses incidental thereto and paying the expenses of issuing the bonds. Moneys in the Construction
18 Fund shall also be used to pay the principal of and interest on the bonds when due if moneys in the Bond
19 Fund are not sufficient for that purpose. Disbursements shall be made from the Construction Fund on the
20 basis of requisitions which shall specify: the name of the person, firm or corporation to whom payment is
21 to be made; the amount of the payment; the purpose of the payment; and that the payment is a proper
22 charge on the Construction Fund. Each requisition must be signed by two authorized representatives of
23 the Commission, which may be officers of LRCVB. The Trustee shall issue its check upon the
24 Construction Fund payable to the person, firm or corporation designated in the requisition.
25 When the Improvements have been completed and all required expenses paid and expenditures made
26 from the Construction Fund for and in connection with the accomplishment of the Improvements and the
27 financing thereof, this fact shall, if there are moneys in the Construction Fund, be evidenced by a
28 certificate signed by the Mayor, which certificate shall state, among other things, the date of the
29 completion and that all obligations payable from the Construction Fund have been discharged. A copy of
30 the certificate shall be filed with the Trustee, and upon receipt thereof the Trustee shall transfer any
31 remaining balance to the Bond Fund.
32 Section 19.
33 (a) Moneys held for the credit of the Construction Fund and the Advertising and Promotion Fund
34 may be invested and reinvested in Permitted Investments or other investments permitted by State law,
(Page 21 of 251
1 which shall mature, or which shall be subject to redemption by the holder thereof, at the option of such
2 holder, not later than the date or dates when such money will be required for the purposes intended.
3 (b) Moneys held for the credit of the Bond Fund and the Revenue Fund shall be invested and
4 reinvested in Permitted Investments, which shall mature, or which shall be subject to redemption by the
5 holder thereof, at the option of such holder, not later than the date or dates when the moneys will be
6 required for payment of the principal of and interest on the bonds when due.
7 (c) The Trustee shall invest and reinvest moneys held by it pursuant to the direction of the City
8 and in the Trustee's discretion in the absence of any direct instructions from the City.
9 (d) Obligations so purchased as an investment of moneys in any fund shall be deemed at all times
10 to be a part of such fund and any profit or loss realized from such investments shall be credited to such
11 fund.
12 (e) To the extent not insured by FDIC or invested as provided herein, all moneys in the funds
13 created hereby be secured in the manner required or permitted by State Law. All security for deposits
14 shall be perfected in such manner as may be required or permitted under State Law in order to grant to the
15 City a perfected security interest in such deposits.
16 (f) "Permitted Investments" means any of the securities that are at the time legal for investment
17 of City funds pursuant to Resolution No. 12,520 of the City and Arkansas Code Annotated §§19-1-501-
18 505 (Supp. 2013), as each may be amended from time to time.
19 Section 20. The Trustee shall be responsible for the exercise of good faith and reasonable prudence
20 in the execution of its trusts. The recitals in this ordinance and in the bonds are the recitals of the City
21 and not of the Trustee. The Trustee shall not be required to take any action as Trustee unless it shall have
22 been requested to do so in writing by the owners of not less than 10% in principal amount of bonds then
23 outstanding and shall have been offered reasonable security and indemnity against the costs, expenses and
24 liabilities to be incurred therein or thereby. The Trustee may resign by giving sixty (60) days' notice in
25 writing to the City Clerk and the owners of the bonds, and the majority in principal amount of the owners
26 of the outstanding bonds or the City, so long as it is not in default hereunder, at any time, with or without
27 cause, may remove the Trustee. In the event of a vacancy in the office of Trustee, the City shall forthwith
28 designate a new Trustee. The new Trustee shall be a bank or a trust company in good standing, duly
29 authorized to exercise trust powers and subject to examination by Federal or State authority, having a
30 reported capital and surplus of not less than $50,000,000 (or is an affiliate of, or has a contractual
31 relationship with, a corporation or banking association meeting such capital and surplus requirements
32 which guarantees the obligations and liabilities of the proposed trustee). The Trustee and any successor
33 Trustee shall file a written acceptance and agreement to execute the trusts imposed upon it by this
34 Ordinance, but only upon the terms and conditions set forth in this ordinance and subject to the provisions
'Page 22 of 251
1 of this Ordinance,to all of which the respective owners of the bonds agree. Such written acceptance shall
2 be filed with the City Clerk, and a copy thereof shall be placed in the bond transcript. Any successor
3 Trustee shall have all the powers herein granted to the original Trustee.
4 Section 21.
5 (a) The terms of this ordinance shall constitute a contract between the City and the owners of the
6 bonds and no variation or change in the undertaking herein set forth shall be made while any of the bonds
7 are outstanding,except as hereinafter set forth in subsections(b)and (c).
8 (b) The Trustee may consent to any variation or change in this ordinance (i) that the Trustee
9 determines is not to the material prejudice of the owners of the bonds or (ii) in order to cure any
10 ambiguity, defect or omission in this ordinance or any amendment hereto, without the consent of the
11 owners of the bonds.
12 (c) The owners of not less than 75% in aggregate principal amount of the bonds then outstanding
13 shall have the right, from time to time, anything contained in this ordinance to the contrary
14 notwithstanding, to consent to and approve the adoption by the City of such ordinance supplemental
15 hereto as shall be necessary or desirable for the purpose of modifying, altering, amending, adding to or
16 rescinding, in any particular, any of the terms or provisions contained in this ordinance or in any
17 supplemental ordinance; provided, however, that nothing contained in this Section shall permit or be
18 construed as permitting (1) an extension of the maturity of the principal of or the interest on any bond, or
19 (2) a reduction in the principal amount of any bond or the rate of interest thereon, or(3) the creation of a
20 pledge of the Pledged Revenues superior to the pledge created by this ordinance, or (4) a privilege or
21 priority of any bond or bonds over any other bond or bonds, or(5) a reduction in the aggregate principal
22 amount of the bonds required for consent to such supplemental ordinance.
23 Section 22. The Mayor, and other officers of the City in accordance with their offices, are authorized
24 to execute such writings and take such action as may be appropriate to cause the Bonds to be issued.
25 Without limiting the generality of the foregoing,the Mayor and other officers of the City are authorized to
26 execute and deliver such undertakings as may be appropriate to the securing of the Reserve Policy,
27 including the Reserve Agreement.
28 Section 23.
29 (a) The City covenants that it shall not take any action or suffer or permit any action to be taken
30 or condition to exist which causes or may cause the interest payable on the bonds to be included in gross
31 income for federal income tax purposes. Without limiting the generality of the foregoing, the City
32 covenants that the proceeds of the sale of the bonds and the Pledged Revenues will not be used directly or
33 indirectly in such manner as to cause the bonds to be treated as "arbitrage bonds" within the meaning of
34 Section 148 of the Code.
IPage 23 of 251
1 (b) The City represents that it has not used or permitted the use of, and covenants that it will not
2 use or permit the use of the Improvements or the proceeds of the bonds, in such manner as to cause the
3 bonds to be"private activity bonds"within the meaning of Section 141 of the Code.
4 (c) The City covenants that it will not reimburse itself from bond proceeds for any costs paid
5 prior to the date the bonds are issued except in compliance with United States Treasury Regulation No.
6 1.150-2 (the "Regulation"). This ordinance shall constitute an "official intent" for the purpose of the
7 Regulation.
8 (d) The City covenants that it will, in compliance with the requirements of Section 148(f) of the
9 Code, pay with moneys in the Bond Fund to the United States Government in accordance with the
10 requirements of Section 148(f) of the Code, from time to time, an amount equal to the sum of(1) the
11 excess of(A) the amount earned on all Non-purpose Investments (as therein defined) attributable to the
12 bonds, other than investments attributable to such excess over (B) the amount which would have been
13 earned if such Non-purpose Investments attributable to the bonds were invested at a rate equal to the
14 Yield (as defined in the Code) on the bonds, plus (2) any income attributable to the excess described in
15 (1), subject to the exceptions set forth in Section 148 of the Code. The City further covenants that in
16 order to assure compliance with its covenants herein, it will employ a qualified consultant to advise the
17 City in making the determination required to comply with this subsection (d). Anything herein to the
18 contrary notwithstanding this provision may be modified or rescinded if in the opinion of Bond Counsel
19 such modification or rescission will not affect the tax-exempt status of the bonds for federal income tax
20 purposes.
21 Section 24. The City covenants that it will take no action which would cause the bonds to be
22 "federally guaranteed"within the meaning of Section 149(b) of the Code. The City further covenants that
23 it will submit to the Secretary of the Treasury of the United States, not later than the 15th day of the
24 second calendar month after the close of the calendar quarter in which the bonds are issued, a statement
25 concerning the bonds which contains the information required by Section 149(e)of the Code.
26 Section 25. In the event the offices of Mayor, City Clerk, Senior Vice President of Finance and
27 Administration of LRCVB or Commission shall be abolished, or any two or more of such offices shall be
28 merged or consolidated, or in the event the duties of a particular office shall be transferred to another
29 office or officer, or in the event of a vacancy in any such office by reason of death, resignation, removal
30 from office, or otherwise, or in the event any such officer shall become incapable of performing the duties
31 of his office by reason of sickness, absence from the City, or otherwise, all powers conferred and all
32 obligations and duties imposed upon such office or officer shall be performed by the office or officer
33 succeeding to the principal function thereof, or by the office or officer upon whom such powers,
34 obligations,and duties shall be imposed by law.
1Page 24 of 251
1 Section 2. Severability. In the event any section, subsection, subdivision, paragraph, subparagraph,
2 item, sentence, clause, phrase or word of this ordinance is declared or adjudged to be invalid or
3 unconstitutional, such declaration or adjudication shall not affect the remaining provisions of this
4 ordinance which shall remain in full force and effect as if the portion so declared or adjudged invalid or
5 unconstitutional was not originally a part of this ordinance.
6 Section 3. Repealer. All ordinances and resolutions inconsistent with this ordinance are hereby
7 repealed to the extent of such inconsistency.
8 Section 4. Emergency Clause. It is hereby ascertained and declared that the Improvements are
9 immediately needed for the preservation of the public peace, health and safety and to remove existing
10 hazards thereto. The Improvements cannot be accomplished without the issuance of the bonds, which
11 cannot be sold at the interest rates specified herein unless this Ordinance is immediately effective.
12 Therefore, it is declared that an emergency exists and this Ordinance being necessary for the
13 preservation of the public peace, health and safety shall be in force and take effect immediately upon and
14 after its passage.
15 PASSED: June 17,2014
16 A APPRO DD:
17 18 VI
10
19 :u.an IL:ngle City Clerk Mark Stodola,Mayor
20 AP' ' II ED AS TO LEGAL FORM:
21
22 N• e0k/AIAI-----
23 Thomas M. Carpenter,tity Attogey
24 //
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