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HomeMy WebLinkAbout13307ORDINANCE NO. 13,307 AN ORDINANCE AUTHORIZING THE ISSUANCE OF TEMPORARY TOURISM REVENUE BONDS; PRESCRIBING OTHER MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY. WHEREAS, the City of Little Rock, Arkansas (the "City ") is authorized, pursuant to Act No. 380 of the Acts of Arkansas of 1971, as amended, to own, acquire, construct, reconstruct, extend, equip, improve, operate, maintain, sell, lease, contract - concerning, or otherwise deal in or dispose of any lands, build- ings, improvements or facilities of any and every nature whatever necessary or desirable for the securing and developing of tourism; and WHEREAS, the City Advertising and Promotion Commission of the City of Little Rock, Arkansas (the "Commission "), has, in cooperation with the Board of Directors (the "Board ") of the i City, formulated plans for a proposed convention /meeting hall and sports arena ( "Megaplex ") to be located in the downtown area of the City; and WHEREAS, there is an immediate need to acquire, as a portion of the site for Megaplex, the real property located at Fourth and Spring Streets in the City (the "Property "),. which is owned and occupied by Commonwealth Federal Savings and Loan Association, Little Rock, Arkansas ( "Commonwealth Federal "); and WHEREAS, Commonwealth Federal has agreed to sell the Property for its appraised value as determined by a joint board of appraisers (consisting of one appraiser selected by the Commission, one selected by Commonwealth Federal and the third by the appraisers), and the board of appraisers has been named and has appraised the value of the Property at $1,100,000; and WHEREAS, pending the issuance of the permanent bonds to finance Megaplex, the necessary moneys to acquire the Property may be obtained by issuance by the City of revenue bonds under the provisions of Act No. 380 of the Acts of -2- Arkansas of 1971, as amended ( "Tourism Revenue Bonds "), payable from revenues derived from the Property and from revenues de- rived from the tax of one percent (1 %) upon the gross receipts from hotel and motel accommodations and upon the gross receipts of restaurants, cafes, cafeterias and other establishments selling food for on- premises consumption (the "City gross receipts tax ") levied by the City, by Ordinance No. 12,353, adopted and approved May 4, 1970, pursuant to Act No. 185 of _ the Acts of Arkansas of 1965, as amended; and WHEREAS, the immediate acquisition of the Property is essential to the development of Megaplex; and WHEREAS, neither the Commission nor the City has sufficient funds to pay the costs of acquiring the Property; and WHEREAS, pursuant to the recommendation of the Commission, the Board of the City has determined that the most feasible way to obtain the needed funds to acquire the Property will be to issue Tourism Revenue Bonds; and WHEREAS, the City has made arrangements to sell the Tourism Revenue Bonds at a price of par and accrued interest for bonds bearing interest at the rate of 4% per annum; NOW, THEREFORE, BE IT ORDAINED by the Board of Directors of the City of Little Rocik, Arkansas: Section 1. That the acquisition of the Property be accomplished and the City Manager, Mayor and Clerk are hereby authorized to take all action and to execute all contracts and instruments necessary or desirable in connection with the acquisi- tion of the Property. Section 2. That under the authority of the Constitution and laws of the State of Arkansas, including particularly Act No. 380 of the Acts of Arkansas of 1971, as amended, Tourism Revenue Bonds (hereinafter referred to as the "bonds ") are hereby authorized and ordered issued in the total principal amount of $1,100,000 for the purpose of financing the costs f -3- of acquiring the Property. The sale of the bonds to the pur- chasers for the purchase price set forth in the recitals of this Ordinance is hereby approved. The bonds shall bear interest at the rate of 4% per annum, shall be dated August 1, 1977, with interest payable semiannually on February 1 and August 1 of each year, commencing February 1, 1978, and shall mature on August 1, 1979. The bonds shall be issued as fully registered bonds - (registered as to principal and interest), and principal and interest shall be paid by check mailed by first class mail to the registered,owner at the address reflected on the registra- tion books of the City maintained by the Trustee. They shall be in any denomination which is a multiple of $5,000 and shall be numbered consecutively from R -1 upwards. The bonds shall be in typewritten form and any bond may be exchanged at any time upon not less than thirty (30) days notice for bonds of smaller denominations (which must be in multiples of $5,000) with any expenses necessarily incurred in connection with any such exchange to be paid by the registered owner requesting the exchange. Section 3. The bonds shall be executed on behalf of the City by the Mayor and City Clerk and shall have impressed thereon the seal of the City. The principal of and interest on the bonds shall be payable solely out of the Tourism Revenue Bond Fund - Megaplex Project (hereinafter created) and shall be a valid claim of the bondholders only against that such Fund and the revenues pledged to such Fund. The bonds and the interest thereon shall not constitute an indebtedness of the City within any constitutional or statutory limitation. Section 4. That the bonds shall be in substantially the following form and the Mayor and City Clerk are hereby authorized and directed to make all recitals contained therein: UNITED STATES OF AMERICA STATE OF ARKANSAS COUNTY OF PULASKI CITY OF LITTLE ROCK 4% TOURISM REVENUE BOND (MEGAPLEX PROJECT) No. R- KNOW ALL MEN BY THESE PRESENTS: C� That the City of Little Rock, County of Pulaski, and State of Arkansas (the "City "), acknowledges itself to owe and, for value received, hereby promises to pay to or assigns (the "payee ") on the first day of August, 1979, the principal sum of DOLLARS in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of debts - due the United States of America, and to pay interest on the s principal sum hereof outstanding, from time to time, in like coin or currency, at the rate of four percent (4 %) per annum from the date hereof, semiannually on February 1 and August 1 of each year, commencing February 1, 1978, until the principal hereof has been paid in full. Payments of principal and interest, including redemption. of principal as hereinafter provided, shall be be made by check mailed by first class mail to the registered owner hereof at his address on the registration book of the City maintained by the Trustee. Each payment shall be noted on a Payment Record main- tained by the Trustee, and all such payments shall fully discharge the obligation of the City hereon to the extent of the payments so made. The registered owner may present this bond to the Trustee at any time for verification and completion of the Payment Record attached hereto. Upon final payment of principal and interest, this bond shall be submitted to the Trustee for can- cellation and surrender to the City. The Trustee of this bond is Union National Bank of Little Rock, Little Rock, Arkansas. -5- This bond is one of an issue of bonds authorized in the aggregate principal amount of $1,100,000 (the "bonds ") being issued for the purpose of financing the costs of acquiring certain Property described in the Authorizing Ordinance (here- inafter referred to) and paying the expenses of issuing the bonds. The bonds are issued pursuant to and in full compliance with the Constitution and laws of the State of Arkansas, in- _ cluding particularly Act No. 380 of the Acts of Arkansas of 1971, as amended, and pursuant to Ordinance No. of the City, adopted and approved on the day of 1977 (the "Authorizing Ordinance "), and the bonds do not con- stitute an indebtedness of the City within any constitutional or statutory limitation. The bonds are not general obligations of the City, but are special obligations payable solely from revenues derived from a pledge of (1) revenues derived from the operation of the Property and (2) that amount of revenues derived from the 1% gross receipts tax on hotel and motel accommodations and on restaurants, cafes, cafeterias and other establishments levied by Ordinance No. 12,353 of the ordinances of the City, adopted pursuant to the authority of Act No. 185 of the Acts of Arkansas of 1965, as amended (subject to and subordinate to the pledge of revenues from such gross receipts tax to certain Parking Facilities Revenue Bonds issued pursuant to Ordinance No. 12,452 of the ordinances of the City, adopted and approved May 4, 1970), necessary, together with revenues derived from the Property, to insure the prompt payment of the principal and interest on the bonds in accordance with the pro- visions of and as specified in the Authorizing Ordinance. An amount of such revenues sufficient to pay the interest on the bonds is to be set aside in a special fund for that purpose identified as the Tourism Revenue Bond Fund - Megaplex Project (created by the Authorizing Ordinance). Reference is hereby made to the 0M. Authorizing Ordinance for a detailed statement of the nature and extent of the security, the rights and obligations of the City, the Trustee and the registered owners of the bonds, and the terms and conditions upon which the bonds are issued, in- cluding, without limitation, the covenant of the City to charge and collect sufficient rates and charges for the use of the Property (subject to certain rights of the City to permit Commonwealth Federal Savings and Loan Association, Little Rock, Arkansas, to occupy the Property without charge or to make such other arrangements specified in Section 5 of the Authorizing Ordinance) as will always produce sufficient revenues to.pro- vide for the prompt payments of the principal of and interest on the Bonds (there is no provision for required deposits out of the revenues into the Bond Fund for the payment of principal prior to maturity of the bonds, it being contemplated that bonds to permanently finance the Property will be issued as specified in Section 22 of the Authorizing Ordinance), the Trustee's and Paying Agent's fees, as the same become due, and for the operation and maintenance expenses of the Property. The principal of the bonds shall be subject to redemp- tion prior to maturity, at the option of the City, in any amount without penalty, at a price of par and accrued interest, from funds from any source, at any time. Moneys available for redemption shall be applied proportionately to all the outstanding bonds. In the event of a partial redemption, the holder shall surrender this bond to the City for notation on the Payment Record attached hereto of the amount of principal redeemed. Notice of any redemption shall be given at least fifteen (15) days prior to the date fixed for such redemption by first class mail to the registered owner of this bond specifying the amount of principal to be redeemed and the amount of accrued interest thereon to the date of such redemp- tion. ' i I _7_ IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required to exist, happen and to be performed precedent to and in the issuance of the bonds, have existed, have happened and have been performed in due time, form and manner, as required by law; that the indebtedness represented by the bonds does not exceed any constitutional or statutory limitation; and that sufficient revenues have been pledged to and will be set aside into the Bond Fund, referred _ to above, for the payment of the principal of and interest on the bonds. This bond shall not be valid until the Certificate of Authentication hereon shall have been signed by the Trustee. IN WITNESS WHEREOF, the City of Little Rock, Arkansas, has caused this bond to be executed in its name by the Mayor and City Clerk, and its seal to be affixed, all as of the first day of August, 1977. ATTEST: City Clerk (SEAL) CITY OF LITTLE ROCK, ARKANSAS By Mayor TRUSTEE'S CERTIFICATE OF AUTHENTICATION This bond is one of the bonds described in the within mentioned Ordinance. UNION NATIONAL BANK OF LITTLE ROCK Little Rock, Arkansas By Authorized Signature ASSIGNMENT For value received, the registered owner last listed below sells, conveys, transfers, assigns and delivers this bond to the assignee last listed below. REGISTERED OWNER ASSIGNEE ME PAYMENT RECORD Principal Name of Paying Principal Balance Interest Agent, Authorized Due Date Payment Due Payment Official and Title February 1, 1978 August 1, 1978 February 1, 1979 August 1, 1979 -lo- Section 5. That from and after delivery of the bonds the Property shall be continuously operated as a revenue pro- ducing undertaking; provided, however, that the City may in its discretion permit Commonwealth Federal to occupy the Pro- perty without charge for such period of time, or may make such other arrangement with Commonwealth Federal pertaining to the use or occupancy of the Property, as the City shall deem necessary or desirable to the development of Megaplex. All moneys re- ceived from the operation of the Property shall be deposited in such depository or depositories for the City as may be law- fully designated from time to time by the Board, provided -that such depository or depositories shall hold membership in the Federal Deposit Insurance Corporation. All deposits shall be designated so as to indicate the particular fund to which the revenues belong. Section G. Tourism Revenue Fund - Megaplex Project. All revenues derived from the operation of the Property shall be paid into a special fund, which is hereby created and desig- nated "Tourism Revenue Fund - Megaplex Project" (the "Revenue Fund "). Such revenues shall be used to the extent necessary to pay any required monthly operation and maintenance expenses of the Property and the remainder is hereby pledged and shall be applied as hereinafter set forth. Section 7. Tourism Revenue Bond Fund - Megaplex Project. (a) There shall be deposited from the Revenue Fund into a special fund which is hereby created and designated "Tourism Revenue Bond Fund - Megaplex Project" (the "Bond Fund "), the sums in the amount and at the times hereafter stated in subsection (b) for the purpose of providing funds for the payment of interest on the bonds as they mature, and the Trustee's and Paying Agent's fees. -11- (b) There shall be paid from the Revenue Fund into the Bond Fund on the first business day of each month until all outstanding bonds, principal and interest, have been paid, or adequate provision made for such payment, a sum equal to 1/6 of the next installment of interest, plus an amount sufficient to provide for the Trustee's and Paying Agent's fees as the same become due. It is understood that the required monthly deposits hereunder shall be so made as to result in there being on hand in the Bond Fund an amount sufficient to provide for the prompt payment of the interest on the bonds as the same becomes due. Payments for Trustee's and Paying Agent's fees shall be made from time to time prior to the time such fees are due. (c) If the revenues in the Revenue Fund shall be suffi- cient to make the required payment on the first business day of the following month into the Bond Fund, then.the amount of any such deficiency in the payment made shall be added to the amount otherwise required to be paid into the Bond Fund on the first business day of the next month. (d) When the moneys in the Bond Fund shall be and remain sufficient to pay the principal of and interest on all the bonds then outstanding and Paying Agent's fees, there shall be no obligation to make any further payments to the Bond Fund. (e) All moneys in the Bond Fund shall be used solely for the purpose of paying the principal of and interest on the bonds and Trustee's and Paying Agent's fees, as the same be- come due, except that if at any time there shall be accumulated in the Bond Fund a surplus in excess of the amount necessary to insure the prompt payment of the principal of and interest on, and Trustee's and Paying Agent's fees in connection with, the bonds as the same become due, such surplus may be used as the Board shall determine, to redeem bonds prior to maturity in the manner provided herein for redemption prior to maturity or may be trans- ferred to the Revenue Fund. -12- (f) There shall be withdrawn from the Bond Fund at least five (5) days before any principal or interest due date and deposited with the Paying Agent an amount equal to the amount that will be due for the sole purpose of paying the same, together with the amount necessary for Trustee's and Paying Agent's fees, and no withdrawal of funds from the Bond Fund shall be made for any other purpose except in the case of an accumulated surplus which may be used as aforesaid in (e). All deposits shall be at the sole risk of the City and shall not operate as a payment of bond until so applied. (g) The bonds shall be specifically secured by a pledge of all revenues required by this Ordinance to be placed into the Bond Fund. The pledge in favor of the bonds is hereby irrevocably made according to the terms of this Ordinance, and the City, the Commission, and the officers and employees of the City and the Commission shall execute, perform and carry out the terms thereof in strict conformity with the provisions of this Ordinance. Section 8. Any moneys remaining in the Revenue Fund after the required deposits into the Bond Fund and payment of any required monthly operation and maintenance expenses of the Property in accordance with the provisions pertaining thereto hereinabove set forth, may be used, as determined by the Board of the City, for either or both of the following purposes: (1) Redemption of bonds prior to maturity; or (2) For any lawful purpose. Section 9. Subject to the prior pledge described here- inafter, the City hereby expressly pledges, and covenants to use, revenues derived from the City gross receipts tax levied by Ordi- nance No. 12,353 of the Ordinances of the City, pursuant to the authority of Act No. 185 of the Acts of Arkansas of 1965, as amended, to the extent, and only to the extent, that such revenues may be -13- required, together with revenues derived from the Property, to pay the interest on and principal of the bonds in accordance with the provisions of this Ordinance. The above pledge of revenues from the City gross receipts tax is hereby expressly made subject to and sub- ordinate to the pledge of the revenues from the City gross receipts tax to certain Parking Facilities Revenue Bonds (the "prior bonds ") issued pursuant to Ordinance No. 12,452 of the ordinances of the City, adopted and approved May 4, 1970. All revenues derived from the City gross receipts tax not required for the purposes aforesaid shall be released from this pledge (subject to the subsequent provisions here- of) and may be used by the City for any lawful purpose. In this re- gard, the Commission is hereby authorized to use from time to time all of the revenues derived from the City gross receipts tax for any purpose authorized by Act No. 185 of the Acts of Arkansas of 1965, as amended, or by Ordinance No. 12,353, or as authorized from time to time by any applicable law or ordinance, subject in all instances to the priority of pledge and claim on such revenues in favor of the bonds and of the prior bonds. If, at any time, it appears that revenues derived from the City gross receipts tax will be needed, as reasonably determined by the Trustee on the basis of projected revenues from the Property and expenditures thereof required by the provisions of this Ordinance, the Trustee shall notify the Commission of such need and of the amount determined by the Trustee that w?.11 be needed. Thereafter and until notified by the Trustee to the contrary, the Commission shall deposit in the Bond Fund the amounts from the City gross receipts tax so specified in the notice from the Trustee to the Commission. The City and the Commission covenant and agree that they will at all times while any of the bonds are outstanding, continue to collect the City gross receipts tax in at least the amount necessary to enable the City to discharge its obligations set forth in this Section 9 and in this Ordinance. -14- For all purposes hereunder the required amount of revenues derived from the City gross receipts tax to satisfy the pledge in favor of the bonds shall be considered part of the "pledged revenues ", or revenues pledged to the bonds, for purposes of Section 10 and all other sections and provisions of this Ordinance. All references herein to "City" in connec- tion with the City gross receipts tax, or in connection with the functions of the Commission, shall, where applicable, be deemed to mean or include the Commission. Section 10. The City covenants that it will not issue any bonds, or incur any obligation, secured by a prior lien on or prior pledge of the revenues pledged to the bonds, or ranking on a parity of lien or pledge with the lien and pledge in favor of the bonds on the pledged revenues. Nothing herein, how- ever, shall prohibit the City from issuing obligations, secured z by a subordinate lien on, or subordinate pledge of, the revenues pledged to the bonds. Section 11. That it is hereby covenanted and agreed by the City with the holders of the bonds that the City and the Commission will faithfully and punctually perform all duties with reference to the Property and the bonds, required by the Constitution and laws of the State of Arkansas and by this Ordinance, including the charging and collecting of sufficient rates and charges for the use of the Property (subject to the provisions of Section 5 hereof) and the collection of the City gross receipts tax, as herein specified and covenanted, the segregating of the revenues pledged hereby and the applying of the pledged revenues to the respective funds created hereby. Section 12. That the bonds shall be subject to redemp- tion prior to maturity in the manner and in accordance with the terms set out in the bond form. Section 13. That the City will keep or cause to be kept proper books of accounts and records (separate from all -15- other accounts and records) in which complete and correct entries shall be made of all transactions relating to the Property and the operation thereof, and such books shall be available for inspection by the holder of any of the bonds at reasonable times and under reasonable circumstances. The City agrees to have these records audited by an independent public accountant at least once each year, and a copy of the audit shall be delivered to the Trustee. In the event the City fails or refuses to make _ the audit, the Trustee may have the audit made and the cost thereof shall be charged against the Operation Fund. Section 14. That the City covenants and agrees that the Property will be maintained in good condition and that the Property will be operated in an efficient manner and at reason- able cost. While any of the bonds are outstanding, the City agrees that it will insure or cause to be insured, and at all times keep insured or cause to be kept insured, with fire and extended coverage insurance, in the amount of the full insur- able value, in responsible insurance companies authorized and qualified under the laws of the State of Arkansas to assume the risks, the properties of the Property at least to the extent that such properties would be covered by insurance by private companies engaged in similar types of operations, as reasonably determined by the City. The insurance policies are to carry a clause making them payable to the Trustee as its interest may appear, and either the policies or an appropriate certificate shall be placed in the custody of the Trustee. In the event of loss, the proceeds of such insurance shall be deposited to the credit of the Bond Fund. Nothing herein shall be construed as requiring the City to expend any funds for operation and maintenance of the Property or for premiums on insurance other than the pledged revenues, but nothing herein shall be construed as preventing the City from doing so. Section 15. -16- That the City covenants and agrees that so long as any bonds authorized hereby are outstanding, it will not mortgage or otherwise encumber the Property, or any part thereof, and will not sell, lease or otherwise dispose of any substantial portion of the same without the prior written approval of the Trustee. Section 16. (a) That if there be any default in the payment of the principai`of and interest on any of the bonds, or if the City defaults in the performance of any covenant contained in this Ordinance, the Trustee may, and upon the written request of the holders of not less than ten percent (100) in principal amount of the bonds then outstanding shall, by proper suit compel the performance of the duties of the officials of the City and the Commission under the Constitution and laws of the State of Arkansas and under this Ordinance, and to take any action or obtain any proper relief in law or equity available under the Constitution and laws of the State of Arkansas. And, in the case of a default in the payment of the principal of and interest on any of the bonds, the Trustee may, and upon written request of holders of not less than ten percent (100) in principal amount of the bonds then outstanding shall, apply in a proper action to a Court of competent juris- diction for the appointment of a receiver to administer the Property on behalf of the City and the bondholders with power to charge and collect (or by mandatory injunction or otherwise to cause to be charged and collected) rates and charges suffi- cient to provide for the payment of the bonds and interest there- on and for the payment of operation and maintenance expenses and to apply the revenues and income in conformity with the applicable laws of the State of Arkansas and with this Ordinance. When all defaults in principal and interest payments have been cured, the custody and operation of the Property shall revert to the City. -17- (b) No holder of any bond shall have any right to institute any suit, action, mandamus or other proceeding in equity or in law for the protection or enforcement of any right under this Ordinance or under the Constitution and laws of the State of Arkansas unless such holder previously shall have given to the Trustee written notice of the default on account of which such suit, action or proceeding is to be taken, and unless the holders of not less than ten percent (10 %) in principal amount _ of the bonds of this issue then outstanding shall have made written request of the Trustee after the right to exercise such powers or right of action, as the case may be, shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers herein granted or granted by the Constitution and laws of the State of Arkansas, or to institute such action, suitor proceeding in its name, and unless, also, there shall have been offered to the Trustee reasonable security and indemnity against the cost, expense and liabilities to be incurred therein or there- by and the Trustee shall have refused or neglected to comply with such request within a reasonable time, and such notifica- tion, request and offer of indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions precedent to the execution of the powers and trust of this Ordinance or to any other remedy hereunder. It is understood and intended that no one or more holders of the bonds hereby secured shall have any right in any manner whatever 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 herein provided, that all proceedings at law or in equity shall be instituted, had and maintained in the manner herein provided and for the benefit of all holders of the out- standing bonds and coupons, and that any individual rights of action or other right given to one or more of such holders by law are restricted by this Ordinance to the rights and remedies herein provided. IFM (c) That all rights of action under this Ordinance or under any of the bonds secured hereby, enforceable by the Trustee, may be enforced by it without the possession of any of the bonds or coupons appertaining thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its name and for the benefit of all the holders of the bonds and coupons, subject to the provisions of this Ordinance. (d) That no remedy herein conferred upon or reserved to the Trustee or to the holders of the bonds is intended to be exclusive of any other remedy or remedies herein provided, and each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or given by any law or by the Constitution of the State of Arkansas. (e) That no delay or omission of the Trustee or of any holders of the bonds to exercise any right or power accrued upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquies- cence therein, and every power and remedy given by this Ordinance to the Trustee and to the holders of the bonds, respectively, may be exercised from time to time and as often as may be deemed expedient. (f) That the Trustee may, and upon the written request of the holders of not less than ten percent (10 %) in principal amount of the bonds then outstanding shall waive any default which shall have been remedied before the entry of final judg- ment or decree in any suit, action or proceeding instituted under the provisions of this Ordinance or before the completion of the enforcement of any other remedy, but no such waiver shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon. Section 17. Moneys held for the credit of any fund may, at the option of the City, be invested and reinvested -19- pursuant to the direction of the City in direct obligations of, or obligations the principal of and interest on which are un- conditionally guaranteed by, the United States of America, in bank certificates of deposit, or any lawful investment, which shall mature, or which shall be subject to redemption by the holder thereof, at the option of such holder, not later than the date or dates when the moneys held for the credit of the particular fund will be required for the purposes intended as specified by the City. Section 18. That in the event the office of Mayor, City Clerk, Commission, or Board of Directors shall be abolished or any two or more of such offices shall be merged or consoli- dated or in the event the duties of a particular office shall be transferred to another office or officer, or in the event of a vacancy in any such office by reason of death, resignation, removal from office or otherwise, or in the event any such officer shall become incapable of performing the duties of his office by reason of sickness, absence from the City or other- wise, all powers conferred and all obligations and duties im- posed upon such office or officer shall be performed by the office or officer succeeding to the principal functions there- of, or by the office or officer upon whom such powers, obliga- tions and duties shall be imposed by law. Section 19. That the provisions of this Ordinance shall constitute a binding contract between the City and the holders of the outstanding bonds and coupons issued hereunder, and the City will at all times strictly adhere to the terms and provisions hereof and fully discharge all of its obligations hereunder. Subject to the terms and provisions contained in this section and not otherwise, the holders of not less than seventy -five percent (75 %) in aggregate principal amount of the bonds then outstanding shall have the right, from time to time, anything contained in this Ordinance to the contrary -20- notwithstanding, to consent to and approve the adoption by the City of such ordinance supplemental hereto as shall be necessary or desirable for the purpose of modifying, altering, amending, adding to or rescinding, in any particular, any of the terms or provisions contained in this Ordinance or in any supplemental ordinance; provided, however, that nothing herein contained shall permit or be construed as permitting (a) an extension of the maturity of the principal of or the interest on any bond issued hereunder, or (b) a reduction in the principal amount of any bond or the rate of interest thereon, or (c) the creation of a lien upon or a pledge of revenues other than as expressly authorized by the appropriate provisions of this Ordinance as now adopted, or (d) the creation of a privilege of priority of any bond or bonds over any other bond or bonds, or (e) a - reduction in the aggregate principal amount of the bonds re- quired for consent to such supplemental ordinance. Section 20. The Trustee shall be responsible for the exercise of good faith and reasonable prudence in the execution of its trusts. The recitals in this Ordinance and in the face of the bonds are the recitals of the City and not of the Trustee. The Trustee shall not be required to take any action as Trustee unless it shall have been requested to do so in writing by the holders of not less than ten percent (10a) in principal amount of bonds then outstanding and shall have been offered reason- able security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby. The Trustee may resign at any time by ten (10) days' notice in writing to the City Clerk, and the majority in value of the holders of the outstanding bonds at any time, with or without cause, may remove the Trustee. In the event of a vacancy in the office of Trustee, either by resignation or by removal, the majority in value of the holders of the outstanding bonds may appoint a new Trustee, such appointment to be evidenced by a written -21- instrument or instruments filed with the City Clerk. If the majority in value of the holders of the outstanding bonds shall fail to fill a vacancy within thirty (30) days after the same shall occur, then the City shall forthwith designate a new Trustee by a written instrument filed in the office of the City Clerk. Any successor Trustee shall file a written accep- tance and agreement to execute the trusts imposed upon it by this Ordinance, but only upon the terms and conditions set forth in this Ordinance and subject to the provisions of this Ordi- nance, to all of which the respective holders of the bonds agree. Such written acceptance shall be filed with the City Clerk, and a copy thereof shall be placed in the bond transcript. Any successor Trustee shall have all the powers herein granted to the original Trustee. In the event of a change in the office of Trustee,_ the old Trustee shall cease to be Paying Agent, and the successor Trustee shall be and become the Paying Agent. Section 21. That when the bonds have been executed and the seal of the City impressed as herein provided, they shall be delivered to the Trustee, and the Trustee shall authen- ticate them and deliver them to the purchasers upon payment in cash of the purchase price plus accrued interest to the date of delivery of the bonds (called "total sale proceeds "). The Trustee shall handle the total sale proceeds as follows: (a) The Trustee shall deposit the accrued interest into the Bond Fund; and (b) The Trustee shall remit the balance of the total sale proceeds to the City for deposit by the City in a special account designated "Property Acquisition Fund" (the "Acquisition Fund "), in a depository designated by the City that is a member of the Federal Deposit Insurance Corporation. The moneys in -22- the Acquisition Fund in excess of the amount insured by the Federal Deposit Insurance Corporation, unless invested as herein authorized, shall be continuously secured by bonds or other direct or fully guaranteed obligations of the United States of America. The moneys in the Acquisition Fund shall be disbursed solely in payment of the cost of acquiring the Property (in- cluding the cost of acquiring other properties which will be transferred in exchange for the Property or a portion thereof), paying necessary expenses incidental thereto and paying the expenses of issuing the bonds. Disbursements shall be on the basis of checks or requisitions which shall contain at least the following information: the person to whom payment is being made; the amount of the payment; and the purpose by general classification of the payment. Each check or requisition must be signed by one designated representative of the City and, if desired by the Board and so specified to the depository of the Acquisition Fund, by one other person designated by the Board. If requisitions are used, the depository shall issue its check upon the Acquisition Fund payable to the person desig- nated in the requisition. The depository of the Acquisition Fund shall be required to keep accurate records as to all pay- ments made on the basis of requisitions, and the City shall keep accurate records of all payments made on the basis of checks. When the acquisition of the Property has been completed and all required expenses paid from the Acquisition Fund in connection with the Property and the issuance of the bonds, this fact shall be evidenced by a certificate signed by the designated representative of the City and by the Mayor, which certificate shall state, among other things, the date of the completion and that all obligations payable from the Acquisition Fund have been discharged. A copy of the certificate shall be filed with the depository of the Acquisition Fund, and a copy -23- shall be filed with the Trustee, and upon receipt thereof the depository of the Acquisition Fund shall take the necessary steps to transfer any remaining balance in the Acquisition Fund to the Revenue Fund created by this Ordinance. Section 22. Since the bonds authorized hereby mature August 1, 1979, it will be necessary for the City to permanently finance the Property on or prior to their maturity. In this regard the City will issue bonds for such permanent financing, and the City expressly covenants with the Trustee and with the registered owners of the bonds that it will, on or prior to the maturity date of the bonds, issue bonds in at least the principal amount sufficient to pay, principal and interest, on or prior to maturity, all of the bonds then outstanding. Section 23. that the provisions of this Ordinance are hereby declared to be separable, and if any-provision shall for any reason be held illegal or invalid, such holding shall not affect the validity of the remainder of the Ordinance. Section 24. That all ordinances and parts of ordinances in conflict herewith are hereby repealed to the extent of such conflict. Section 25. 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. Section 26. That it is hereby ascertained and declared that the Property should be acquired as soon as possible in order that the Property be made available to the City and its inhabitants at the earliest possible time for the development of Megaplex, all of which is hereby declared to be necessary for the safety and welfare of the citizens of the City. Such cannot be accomplished without the issuance of the bonds author- ized by this Ordinance, and therefore an emergency is hereby -24- declared to exist, and this Ordinance being necessary for the immediate preservation of the public peace, health and safety shall take effect and be in force from and after its passage. PASSED: July 19 , 1977. ATTEST: -AZVwt--- ity C Mayor