HomeMy Public PortalAboutRES-CC-2016-28Moab, Utah
November 8, 2016
The Mayor and City Council of the City of Moab, Grand County, Utah met in regular session
at its regular meeting place in said Municipality at 7:00 o'clock p.m. on the 8th day of November,
2016, with the following members of the Governing Body present:
Dave Sakrison Mayor
Kyle Bailey Councilmember
Heila Ershadi Councilmember
Kalen Jones Councilmember
Tawny Knuteson-Boyd Councilmember
Rani Derasary Councilmember
Also present:
Rachel Stenta City Recorder
Absent:
After the minutes of the preceding meeting had been read and approved, the Town Clerk
presented to the Council an affidavit evidencing the giving of not less than twenty-four (24) hours
public notice of the agenda, date, time and place of the November 8, 2016, meeting of the Council
in compliance with the requirements of Section 52-4-202(1), Utah Code Annotated 1953, as
amended, by (1) posting written notice of the meeting at the principal office of the City Council, and
(2) providing notice to at least one newspaper of general circulation within the geographic
jurisdiction of the City of Moab, Grand County, Utah (the "City") or to a local media correspondent.
The affidavit was ordered recorded in the minutes of the meeting and is as follows:
STATE OF UTAH )
: SS.
COUNTY OF GRAND )
I, RACHEL STENTA, the undersigned City Recorder of the City of Moab, Grand County,
Utah (the "City") do hereby certify according to the records of the City in my official possession, and
upon my own knowledge and belief, that in accordance with the requirements of Section 52-4-202,
Utah Code Annotated 1953, as amended, I gave not less than twenty-four (24) hours public notice
of the agenda, date, time and place of the November 8, 2016, public meeting held by the City as
follows:
(a) causing a Notice of Public Meeting to be posted at the principal office of the City
of Moab, 217 East Center Street, Moab, Utah, on November 7, 2016, at least twenty-four (24) hours
before the convening of the meeting, in the form attached hereto as Exhibit A; said Notice of Public
Meeting having continuously remained so posted and available for public inspection during the
regular office hours of the Issuer until the convening of the meeting; and
(b) causing a copy of the Notice of Public Meeting in the form attached hereto as
Exhibit A to be provided on November 7, 2016, at least twenty-four (24) hours before the convening
of the meeting, to the Moab Times -Independent, a newspaper of general circulation within the
geographic jurisdiction of Moab, Utah, and to any other local media correspondent, newspaper, radio
station or television station which has requested notification of meetings of the Council.
IN WITNESS WHEREOF, I have hereunto subscribed my official signature this 8th day of
November, 2016.
City Recorder
(SEAL)
EXHIBIT A
[Attach Notice of Public Meeting Here]
NOTICE OF AGENDA OF REGULAR MEETING
PLEASE TAKE NOTICE that the Mayor and members of the City Council of the City of
Moab, Grand County, State of Utah, will hold a Regular Meeting on Wednesday, the 8th day of
November, 2016, at its regular meeting place, the Moab City Offices, 217 East Center Street, Moab,
Utah, at the hour of 7:00 o'clock p.m.
The Agenda for the meeting consists, in part, of the following:
(1) Consideration for and adoption of a Parameter Resolution authorizing the issuance
of not to exceed $11,500,000 in Wastewater Revenue Bonds of the City of Moab,
Grand County, Utah and calling of a public hearing to receive input with respect to
the issuance of such Bonds and any potential impact to the private sector from the
construction of the Project; and
(2) Any other business that may come before said meeting.
DATED this 7th day of November, 2016.
City Recorder
After the conduct of other business, the following resolution was introduced in written form
by the Mayor, was read in full and, pursuant to motion made by Councilmember
and seconded by Councilmember , was adopted by the following vote:
Yea: Kyle Bailey
Heila Ershadi
Kalen Jones
Tawny Knuteson-Boyd
Rani Derasary
Nay: None
The Resolution was thereupon signed by the Mayor, was attested and countersigned by the
City Recorder and was ordered recorded in the official records of the Issuer.
The Resolution is as follows:
CITY OF MOAB, GRAND COUNTY, UTAH
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE ISSUANCE AND CONFIRMING
THE SALE OF WASTEWATER REVENUE BONDS IN THE AGGREGATE
PRINCIPAL AMOUNT OF NOT TO EXCEED $11,500,000 (THE "BONDS")
OF THE CITY OF MOAB, GRAND COUNTY, UTAH (THE "ISSUER"),
CALLING A PUBLIC HEARING AND ESTABLISHING A TIME, PLACE
AND LOCATION FOR SAID PUBLIC HEARING TO RECEIVE INPUT
FROM THE PUBLIC WITH RESPECT TO THE ISSUANCE OF BONDS
AND ANY POTENTIAL ECONOMIC IMPACT TO THE PRIVATE SECTOR
FROM THE CONSTRUCTION OF THE PROJECT TO BE FUNDED BY
THE BONDS; PROVIDING FOR A PLEDGE OF WASTEWATER
REVENUES FOR THE PAYMENT OF THE BONDS; FIXING THE
MAXIMUM PRINCIPAL AMOUNT OF THE BONDS; THE MAXIMUM
NUMBER OF YEARS OVER WHICH THE BONDS MAY MATURE, THE
MAXIMUM INTEREST RATE WHICH THE BONDS MAY BEAR, AND
THE MAXIMUM DISCOUNT FROM PAR AT WHICH THE BONDS MAY
BE SOLD; PROVIDING FOR THE RUNNING OF A CONTEST PERIOD;
AND RELATED MATTERS.
WHEREAS subject to the limitations set forth herein, the City of Moab, Grand County, State
of Utah, desires to issue its Wastewater Revenue Bonds (the "Bonds") for the construction
wastewater system improvements, including the construction of a wastewater treatment plant,
together with related improvements to the wastewater system (the "Project"), and to acquire
necessary land, rights of way and other appurtenances and facilities and to defray all or a portion of
the cost thereof from the bonds to be issued hereby, pursuant to this Resolution and a Master
Resolution (the "Master Resolution"), in substantially the form presented at the meeting at which
this Resolution was adopted and which is attached hereto as Exhibit `B"; and
WHEREAS in order to allow for flexibility in setting the financial terms of the Bonds once
costs of the Project are finally determined and to optimize debt service costs to the Issuer, the
Governing Body of the Issuer desires to grant to the Mayor, in accordance with state law, the
authority to approve the interest rates, principal amounts, terms, maturities, redemption features and
purchase price at which the Bonds shall be sold and any changes with respect thereto from those
terms which were before the Governing Body at the time of adoption of this Resolution, provided
that such terms do not exceed the parameters set forth for such terms in Section 1 of this Resolution
(the "Parameters"); and
WHEREAS the Issuer, the City of Moab, considers it desirable and necessary and for the
benefit of the Issuer to construct the Project to be owned and operated by the Issuer, but does not
have on hand money sufficient to pay for the Project; and
WHEREAS the revenues to be derived by the Issuer from the operation of the System (as
hereinafter defined) have not been pledged or hypothecated in any manner or for any purpose and
the Issuer desires to issue its Bonds (as hereinafter defined), payable from such revenues in the
manner for which provision is hereinafter made in order to pay all or part of the cost of the Project;
and
WHEREAS the Utah Local Government Bonding Act, Sections 11-14-101, et seq., Utah
Code Annotated, 1953, as amended, provides that, prior to issuing bonds an issuing entity must (I)
give notice of its intent to issue such bonds and (ii) hold a public hearing to receive input from the
public with respect to the issuance of such bonds and any potential economic impact to the private
sector from the construction of the Project to be funded by the Bonds; and
WHEREAS the Issuer desires to call a public hearing for this purpose and to publish a notice
of such hearing, including a notice of bonds to be issued, in compliance with the Act with respect
to the Bonds; and
WHEREAS the State of Utah acting through its Water Quality Board has tentatively agreed
to purchase Wastewater Revenue Bonds (the 'Bonds"), at interest rates of not to exceed 2.5% per
annum and on the general and special terms and conditions as set forth herein;
NOW, THEREFORE, Be It and It Is Hereby Resolved by the City Council of the City of
Moab, Grand County, State of Utah, as follows:
Section 1. The Mayor and City Council (the "Governing Body") of the City of Moab, Grand
County, Utah (the "Issuer"), hereby finds and determines that it is in the best interests of the residents
within the City for the Issuer to issue its Wastewater Revenue Bonds in the aggregate principal
amounts of not to exceed $11,500,000 at interest rates not to exceed 2.5% per annum, to mature in
not more than twenty-five (25) years from their date or dates (collectively the "Bonds"), pursuant
to a resolution to be adopted by the Governing Body authorizing and confirming the issuance and
sale of the Bonds. Therefore, the Issuer hereby declares its intention to issue the Bonds according
to the provisions of this Section. The Bonds are to be issued for the purpose of paying all or part of
the cost of constructing improvements to the City's wastewater system, including construction of a
wastewater treatment plant, together with related improvements to the wastewater system, the
acquisition of necessary land and easements and the payment of all related costs and services
including engineering, the expenses and costs of the issuance of the Bonds and the cost to acquire
and provide all appurtenant facilities therefor (the "Project").
The Issuer hereby declares its intention to issue the Bonds according to the provisions of this
Section; provided, however, that the Bonds shall only be issued by the Issuer after adoption of a
Master Resolution by the Governing Body of the Issuer (the "Master Resolution") setting forth the
specific terms of the Bonds within the maximum terms herein provided.
The form of Master Resolution attached hereto as Exhibit `B" is in all respects hereby
authorized and approved, and the Mayor and Town Clerk of the Issuer are hereby authorized and
directed to execute and deliver the same on behalf of the Issuer.
The Mayor, within the parameters set forth herein, is hereby authorized to approve the
interest rates, principal amounts, terms, maturities, redemption features and purchase price at which
the Bonds shall be sold.
Section 2. The form, terms and provisions of the Bonds and the provisions for the signatures,
authentication, payment, registration, transfer, exchange, redemption and number shall be as set forth
in the Master Resolution. The Mayor and City Recorder of the Issuer are hereby authorized and
directed to execute and seal the Bonds.
Section 3. The appropriate officials of the Issuer are authorized to make any alterations,
changes or additions to the Master Resolution and the Bonds or any other document herein
authorized and approved which may be necessary to conform the same to the final terms of the
Bonds (within the Parameters set by this Resolution), to correct errors or omissions therein, to
complete the same, to remove ambiguities therefrom, or to conform the same to other provisions of
said instruments, to the provisions of this Resolution or any resolution adopted by the Governing
Body or the provisions of the laws of the State of Utah or the United States.
Section 4. The Issuer shall hold a public hearing on December 13, 2016, to receive input
from the public with respect to the issuance of the Bonds and any potential impact to the private
sector from the construction of the Project to be funded by the Bonds, which hearing date shall be
not less than fourteen (14) days after notice of the public hearing is (A) first published once a week
for two consecutive weeks in the Moab Times -Independent, a newspaper of general circulation in
the Issuer and (B) published on the Utah Public Notice Website created under Section 63F-1-701,
Utah Code Annotated 1953, as amended. The Issuer directs its officers and staff to publish a Notice
of Public Hearing in substantially the following form:
NOTICE OF PUBLIC HEARING
PUBLIC NOTICE IS HEREBY GIVEN that on November 2, 2016, the Mayor and City
Council of the City of Moab (the "Issuer"), adopted a resolution (the "Resolution") declaring its
intention to issue its Wastewater Revenue Bonds (the "Bonds") pursuant to the Utah Government
Bonding Act, Title 11, Chapter 14, Utah Code Annotated 1953, as amended and to call a public
hearing to receive input from the public with respect to the issuance of the Bonds.
The Issuer shall hold a public hearing on December 13, 2016, at the hour of 7:00 p.m. The
location of the public hearing is in the City Office, 217 East Center, Moab, Utah. The purpose of
the meeting is to receive input from the public with respect to the issuance of the Bonds and any
potential economic impact to the private sector from the construction of the Project to be funded by
the Bonds. All members of the public are invited to attend and participate.
DATED this 8th day of November, 2016.
/s/ Rachel Stenta
City Recorder
[Publish once each week for two consecutive weeks.]
* * * * * * * *
Section 5. The Issuer shall also cause a copy of this Resolution (together with all exhibits
hereto) to be kept on file in the Issuer's principal offices for public examination during the regular
business hours of the Issuer until at least thirty (30) days from and after the date of publication
thereof. The Issuer directs its officers and staff to publish a Notice of Bonds to be Issued in
substantially the following form:
NOTICE OF BONDS TO BE ISSUED
PUBLIC NOTICE IS HEREBY GIVEN that on November 8, 2016, the Mayor and City
Council of the City of Moab (the "Issuer"), adopted a resolution (the "Resolution") declaring its
intention to issue its Wastewater Revenue Bonds (the "Bonds"), pursuant to the Utah Local
Government Bonding Act, Title 11, Chapter 14, Utah Code Annotated 1953, as amended.
The Issuer intends to issue the Bonds in the principal amount of not to exceed $11,500,000
to bear interest at a rate not to exceed 2.5% per annum, to mature in not to more than 25years from
their date or dates, and to be sold at a price not less than 100% of the total principal amount thereof,
plus accrued interest to the date of delivery. The Bonds will specify that any installment of principal
on the Bonds which shall not be paid when due shall bear interest at the rate of 18% per annum from
the due date thereof until paid.
The Issuer intends to issue the Bonds for the purpose of (I) financing all or a portion of the
cost to construct improvements to the City's wastewater system, including construction of a
wastewater treatment plant, together with related improvements to the wastewater system; and (ii)
paying costs of issuing the Bonds.
OUTSTANDING BONDS SECURED BY THE SAME REVENUE
The Issuer currently has no outstanding bonds secured by the pledge of wastewater system
revenues.
ESTIMATED TOTAL COST OF THE BONDS
The estimated total cost to the Issuer for the proposed Bonds is $10,400,000.00. The
estimated cost of interest on the Bonds is $1,301,846.00.
NOTICE IS FURTHER GIVEN that a period of 30 days from and after the last date of
publication of this Notice is provided by law during which any person in interest shall have the right
to contest the legality of the Resolution or the Bonds, or any provision made for the security and
payment of the Bonds, and that after such time, no one shall have any cause of action to contest the
regularity, formality or legality thereof for any cause whatsoever.
A copy of the Resolution is on file in the office of the City Recorder in Moab, Utah, where
it may be examined during regular business hours of the City Recorder from 8:00 a.m. to 5:00 p.m.
Monday through Friday.
DATED this 8th day of November, 2016.
[Publish one time only.]
/s/ Rachel Stenta
City Recorder
* * * * * * **
Section 6. For a period of thirty (30) days from and after publication of the Notice of Bonds
to be Issued, any person in interest shall have the right to contest the legality of this Resolution or
the Bonds hereby authorized. After such time, no one shall have any cause of action to contest the
regularity, formality or legality of this Resolution or the Bonds for any cause whatsoever.
Section 7. All resolutions or parts thereof in conflict herewith are, to the extent of such
conflict, hereby repealed and this Resolution shall be in full force and effect immediately upon its
approval and adoption.
PASSED AND APPROVED this 8th day of November, 2016
CITY OF MOAB
By
Mayor
ATTEST AND COUNTERSIGN:
By
City Recorder
[SEAL]
After the conduct of other business not pertinent to the foregoing, it was moved and carried
that the Mayor and City Council adjourn.
CITY OF MOAB
By
Mayor
ATTEST:
By
City Recorder
[SEAL]
STATE OF UTAH
COUNTY OF GRAND
I, RACHEL STENTA, the undersigned, do hereby certify that I am the duly qualified and
acting City Recorder of the City of Moab, Grand County, Utah (the "Issuer"). I further certify that
the above and foregoing constitutes a true and correct copy of the minutes of a regular public
meeting of the Mayor and City Council of the Issuer, held on November 8, 2016, including a
Resolution adopted at such meeting, together with exhibits and appendices attached thereto, as said
minutes, resolution and appendices are recorded in the regular official book of minutes of the
proceedings of the Governing Body kept in the office of the City Recorder that said proceedings
were duly had and taken as therein shown, that the meeting thereon shown was in all respects called,
held and conducted in accordance with law, and that the persons therein named were present at said
meeting, as therein shown.
I further certify and I caused a true and correct copy of the above -referenced resolution
(including all exhibits and appendices attached thereto) to be filed in the office of the City Recorder
for examination by any interested person during the regular business hours of the office of the City
Recorder.
IN WITNESS WHEREOF, I have hereunto subscribed my official signature and impressed
hereon the official seal of the Issuer, this 8th day of November, 2016.
City Recorder
[SEAL]
EXHIBIT B
[Master Resolution]
MASTER RESOLUTION
OF
CITY OF MOAB, GRAND COUNTY, UTAH
AS ISSUER
DATED AS OF *, 2016
MASTER RESOLUTION
WHEREAS, the City of Moab, Grand County, State of Utah, considers it desirable and
necessary and for the benefit of the Issuer to construct, operate and maintain the Project (as
hereinafter defined) to be owned and operated by the Issuer, but does not have on hand money
sufficient to pay for the Project (as hereinafter defined); and
WHEREAS, pursuant to the provisions of a Resolution adopted on November 8, 2016 (the
"Authorizing Resolution"), the Governing Board of the City (the "Governing Board") has authorized
and approved certain actions to be taken by the City in connection with the financing of the Project,
including the adoption this Master Resolution and the issuance of the Series 2016 Bonds hereunder;
and
WHEREAS, it has been determined by the City that the estimated amount necessary to
finance the Project, including necessary expenses incidental thereto, will require the issuance, sale
and delivery of the Series 2016 Bonds in the principal amount of $10,400,000, as hereinafter
provided; and
WHEREAS, the City has determined that the Series 2016 Bonds shall be secured as provided
herein and has ascertained and determined that the provisions herein contained for protecting and
enforcing the rights and remedies of the registered owners of such Series 2016 Bonds are reasonable,
proper and in accordance with law, and that this Master Resolution is necessary to the performance
of its duties and the execution of its powers under law, and does deem and determine all of the
provisions herein contained to be reasonable and proper for the security of the registered owners of
the Series 2016 Bonds; and
WHEREAS, all acts and things required by law to make this Master Resolution a valid and
binding instrument for the security of all Bonds duly issued hereunder have been done and
performed, and the execution and delivery of this Master Resolution have been in all respects duly
authorized; and
WHEREAS, the Series 2016 Bonds in registered form are to be in substantially the
appropriate form set forth in Section 2.06 and if issued as Exchange Bonds are to be in substantially
the appropriate form set forth in Section 2.07, with appropriate variations, omissions and insertions
as permitted or required by this Master Resolution; and
WHEREAS, all things necessary to make the Series 2016 Bonds when authenticated by the
City and issued as in this Master Resolution provided, the valid, binding and legal obligations of the
City according to the import thereof, and to constitute this Master Resolution a valid assignment and
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pledge of the amounts pledged to the payment of the principal on the Series 2016 Bonds, and to
constitute this Master Resolution a valid assignment of the rights of the City with respect to the
Project have been done and performed and the creation, execution and delivery of this Master
Resolution, and the creation, execution and issuance of the Series 2016 Bonds, subject to the terms
hereof, have in all respects been duly authorized:
NOW, THEREFORE, Be It and It Is Hereby Resolved by the Mayor and City Council of the
City of Moab, Grand County, Utah, as follows:
ARTICLE I
DEFINITIONS
As used in this Master Resolution, the following terms shall have the following meanings
unless the context clearly indicates otherwise:
"Act" means the provisions of the Local Government Bonding Act of the State of Utah,
Chapter 14, Title 11, Utah Code Annotated,1953, as amended and the Registered Public Obligations
Act of the State of Utah, Chapter 7, Title 15, Utah Code Annotated, 1953, as amended.
"Annual Debt Service" means the annual payment of principal, interest, if any, and premium
or penalty, if any, to be paid by the Issuer on all outstanding bonds or other forms of indebtedness
which are secured by the revenues of the System.
"Annual Net Revenues" means the Net Revenues for any 12 consecutive calendar months.
"Bond Fund" mean the fund established in Section 4.02 hereof.
"Bond" means the $10,400,000 aggregate principal amount of Wastewater Revenue Bond,
Series 2016 of the Issuer authorized hereby.
"Bond Documents" means this Master Resolution.
"Bondholder" means the registered holder of any registered bond, the issuance of which is
authorized herein.
"City Recorder" means the duly appointed and acting City Recorder of the Issuer.
"Delivery Date" means the date the Bond is delivered to the initial purchaser and this date
to be known on the Bond as the issue date.
"Depository" or "Depository Bank" means a Qualified Depository (defined hereinafter).
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"Escrow Account" means an account to be held in escrow by the Escrow Agent pursuant to
an Escrow Agreement to be entered into between the Issuer and the Water Quality Board on the date
of delivery of the Bond, said account to be used for the purpose of depositing the proceeds of the sale
of the Bond as well as certain grant monies and supervising said proceeds pursuant to the terms of
the Escrow Agreement.
"Escrow Agent" means the Utah State Treasurer.
"Executive Officer" means the Mayor of the Issuer.
"Expense of Maintenance and Operation" means all expenses reasonably and necessarily
incurred in connection with the operating, repairing, maintaining and insuring of the System, and
including ordinary repairs, renewals and replacements, other than capital improvements, necessary
to keep the System in efficient operating condition, the cost of audits hereinafter required, paying
agents' fees, depository fees, legal fees, architect's fees, engineering fees, fiscal agent's fees, escrow
agent's fees, properly allocated charges for insurance, any other expenses described as Expenses of
Maintenance and Operation and generally all expenses which under general accounting practices are
properly chargeable to maintenance and operation, but excluding depreciation.
"First Payment Date" means a payment of principal and interest on May 1, 2019 (there shall
also be a payment of interest only on May 1, 2017 and May 1, 2018) with regard to the Wastewater
Revenue Bond, Series 2016.
"Fully Registered Bond" means a single Bond registered as to both principal and interest in
the denomination equal to the amount of the Bond authorized herein.
"Future Parity Bonds" means any bonds hereafter issued by the Issuer on a parity with the
Bond herein authorized pursuant to the conditions and restrictions set forth in Article V hereof.
"Governing Body" means the Mayor and City Council of the Issuer.
"Installment Amount" means the amount of each annual registered installment of principal
and interest on the Bond, as shown in the Repayment Schedule in the Bond.
"Issue Amount" means the principal amount of the Bond authorized to be issued hereunder
and is the amount of $10,400,000.
"Issuer" means the City of Moab, Grand County, Utah.
"Master Resolution" means this resolution providing for the issuance of a revenue bond
payable from the Revenues of the System, as from time to time amended or supplemented in
accordance with the provisions hereof.
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"Net Revenues" means, for any period, the Revenues during such period less Expenses of
Maintenance and Operation during such period.
"Outstanding" or "Outstanding Bonds" means any Bond which has been issued and delivered
in accordance with the provisions hereof; but shall not include a Bond in lieu of which another Bond
has been issued to replace a mutilated, lost, destroyed or stolen bond.
"Payment Date" means the 1st day of May in each year beginning with the year 2019,
provided, however, that there shall also be a payment of interest only on May 1, 2017 and May 1,
2018.
"Payment Years" means the Years in which Installment Amounts come due, described as the
years 2019 through 2038.
"Permitted Investments" means those investments specified in Section 51-7-11, Utah Code
Annotated, 1953, as amended.
"Project" means the construction of wastewater system improvements, including
construction of a wastewater treatment plant, together with all necessary or related work and
improvements.
"Qualified Depository" means a depository institution constituting a "qualified depository"
under Chapter 7 of Title 51, Utah Code Annotated 1953, as amended.
"Reserve Fund Installment" means a monthly payment of $8,126 for the first six (6) years
until the sum of $585,062 is accumulated.
"Reserve Fund Requirement" means the amount equal to the maximum annual installment
of principal and interest of the Bond, which is $585,062.
"Revenues" means all revenues, income and profits of any kind derived from the operation
of the System, including the proceeds of any connection charges not applied directly to the payment
of the cost of improving or extending the System or of making connections thereto, and all interest
earned by and profits derived from the sale of investments made with the said revenues, income and
profits. Revenues shall not include the proceeds of sale of the Bond, Parity Bonds or other
obligation issued for System purposes.
"Serial Bonds" means the registered $1000 denomination (or multiples of $1000) Wastewater
Revenue Bond, Series 2016 which may be issued in exchange for the Fully Registered Bond.
"System" means the complete wastewater and wastewater system of the Issuer, as such
system now exists, together with the Project, and any other properties now or hereafter owned or
operated by the Issuer relating to said system and as may hereafter be improved and extended,
4
including specifically all properties of every nature owned by the Issuer and used or useful in the
operation of said system, including real estate, personal and intangible properties, contracts,
franchises, leases and choses in action, whether lying within or without the boundaries of the Issuer.
"Treasurer" means the duly appointed, qualified and acting Treasurer of the Issuer.
"Water Quality Board" means the State of Utah, Water Quality Board, or any other successor
agency.
"Year" means the twelve-month period beginning on January 1st of each calendar year and
ending on the next succeeding December 31 st.
Except where the context otherwise requires, words importing the singular number shall
include the plural and vice versa, and words importing the male gender shall include the female
gender and vice versa.
ARTICLE II
TERMS AND PROVISIONS OF THE SERIES 2016 BOND
Section 2.01. Purpose and Authority.
(a) The Governing Body hereby finds, determines and declares that the Project to be
acquired, constructed, improved and extended with the proceeds of the Bond is necessary for the
proper operation of the System and is economically feasible, and the Revenues will be sufficient to
retire the Bond.
(b) For the purpose of paying the cost of the Project, including the payment of all fees
and expenses incident thereto and to the issuance of the Series 2016 Bond, the Series 2016 Bond
shall be issued in the amount or amounts set forth in the Treasurer's Certificate of Dates of Payment
and Amounts at the end of the Bond, but in no event more than the maximum principal amount of
$10,400,000. The Series 2016 Bond shall be payable solely from the Revenues to be derived from
the operation and ownership of the System, as more specifically provided herein, and, to the extent
available, monies remaining in the Construction Fund as described in Section 3.01 upon completion
of the Project.
Section 2.02. Designation and Terms of the Series 2016 Bond. The Series 2016 Bond shall
be designated as the "Wastewater Revenue Bond, Series 2016," shall be dated as of the date of
delivery to the Water Quality Board, and shall be issued only in fully -registered form, without
coupons, with respect to the Fully Registered Bond, in substantially the form provided in Section
2.06 herein and in a single denomination equal to the aggregate principal amount of the Series 2016
Bond (which aggregate principal amount shall be the Issue Amount or such lesser amount as shall
be set forth as the "Total Principal Sum" on the Certificate of Dates of Payment and Amount attached
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to the Series 2016 Bond), and (b) with respect to the Serial Bonds, in substantially the form provided
in Section 2.07 hereinafter and in the denomination or denominations of $1000 or any integral
multiple thereof. The Series 2016 Bonds shall be numbered from one (1) consecutively upward in
order of authentication and delivery by the Issuer. The Series 2016 Bond shall mature in twenty (20)
annual Principal Installments on May 1st of each of the years and in the principal amounts set forth
in the form of the Series 2016 Bond in Section 2.06 and shall bear interest at the rate of 1.15% per
annum. Interest shall be payable on the same day as the due date for a payment of principal,
provided, however, that interest -only payments shall also be payable on May 1, 2017 and May 1,
2018.
Any installment of principal and/or interest which shall not be paid when due shall bear
interest at the rate of eighteen (18%) per cent per annum from the date of maturity of such
installment until paid.
Subject to prepayment of principal as herein provided, principal on the Bond shall be payable
in the number of annual registered installments equal to the number of Payment Years, with no
provision for any grace period as to the due date of such payments; provided, however, that the last
such installment payment shall be in such amount as will pay the remaining principal due and on the
Bond on the date of such payment each in the amount of the Installment Amount, due on the
Payment Date of each of the Payment Years. Each payment shall be first applied to any applicable
interest accrued to the date of payment of that installment, then to principal. Principal and interest,
on the Bond shall be payable in any coin or currency which, on the respective dates of payments, is
legal tender for the payment of debts to the United States of America and, except as hereinafter
otherwise provided, shall be made by check or draft mailed to the Office of the Water Quality Board
in Salt Lake City, Utah, or to its designee or to such other registered owner of the Bond as is shown
on the registration books maintained by the Issuer at the close of business on the fifteenth day of the
month next preceding each Payment Date at the address of such registered owner as it appears on
such registration books or to such other address furnished in writing by such registered owner to the
Issuer, and payment shall be endorsed thereon in the payment record attached thereto.
Section 2.03. Payment of the Series 2016 Bond. So long as Utah Water Quality Board is the
registered owner thereof, principal and interest on the Series 2016 Bond shall be payable in lawful
money of the United States of America by check or draft of the Issuer mailed to the Utah Water
Quality Board, Salt Lake City, Utah, or its designees. In the event the Bond is registered in the name
of a different owner, principal payments shall be payable upon presentation of the Bond and interest
installments shall be mailed to the address of the registered owner as it appears on the registration
books maintained by the Issuer as of the close of business on the 15th day of the month next
preceding each Payment Date or to such other address furnished in writing to the Issuer by such new
registered owner to the Issuer. Each payment shall be endorsed by the registered owner of the Series
2016 Bond on the payment record attached thereto upon receipt thereof.
6
Section 2.04. Prepayment Provisions and Provisions Regarding Notation of Payments.
(a) The Series 2016 Bond shall be subject to prepayment at the option of the Issuer
at any time in whole or in part in multiples of $1000 at the principal amount thereof plus accrued
interest to the date of prepayment, and without premium. Any prepayment shall be allocated to the
Series 2016 Bond unless otherwise approved and directed by the Water Quality Board or other
registered owner of the Bond. In the event of a partial prepayment, each installment payment due
on the Payment Date of each Payment Year after such partial prepayment shall remain in the amount
set forth in Section 2.02 regardless of any such partial prepayment; provided that any such partial
prepayment shall reduce the principal due on the Series 2016 Bond in inverse order of installment
maturities; and provided further that the final payment on the Bond shall be fully sufficient to pay
all principal and interest, if any, remaining due thereon. Each prepayment on the Series 2016 Bond
shall be applied to any interest then due, if any, on the Series 2016 Bond and then to principal, in
inverse order of maturity of the principal installments. Notice of any call for prepayment shall be
given by registered mail not less than 30 nor more than 45 days prior to the prepayment date to the
Utah Water Quality Board, Salt Lake City, Utah, or to its designee, or to such other registered owner
of the Bond as is shown on the registration books at the close of business on the fifteenth day next
preceding the mailing of such prepayment notice at the registered owner's address as shown on such
registration books or at such other address furnished in writing by such registered owner to the
Issuer.
(b) In the event of a partial prepayment, such prepayment shall be made in the
manner provided for herein for the payment of Installment Amounts (except that prepayments need
not be made on Payment Dates) and endorsed on the Bond on the prepayment record attached
thereto.
(c) If notice of prepayment shall have been given as aforesaid, the Series 2016 Bond
or the portion thereof specified in said notice shall become due and payable at the prepayment price
and on the prepayment date therein designated and if, on the prepayment date, money for the
payment of the prepayment price of the Series 2016 Bond or the portion thereof to be prepaid,
together with interest, if any, to the prepayment date, shall be available for such prepayment on said
date, then from and after the prepayment date, interest, if any, on the Series 2016 Bond or the portion
thereof so called for prepayment shall cease to accrue and become payable.
(d) The registered owner of the Series 2016 Bond shall endorse any payment or
prepayment of principal on the Series 2016 Bond upon the payment record or prepayment record
attached to the Series 2016 Bond.
Section 2.05. Execution of Bond and Representations Relating to the Master Resolution.
The Series 2016 Bond shall be executed on behalf of the Issuer by the manual or facsimile signature
of the Executive Officer and attested and countersigned by the manual or facsimile signature of the
City Recorder. The City Recorder shall impress or imprint the official seal of the Issuer on the Bond.
All of the covenants, promises, statements, recitals, representations and agreements contained in the
7
Series 2016 Bond and this Master Resolution are hereby considered and understood, and it is hereby
ordered and declared that the covenants, promises, statements, recitals, representations and
agreements therein and herein are covenants, promises, statements, recitals, representations and
agreements of the Issuer.
Section 2.06. Form of Series 2016 Bond. The Series 2016 Bond shall be in substantially the
following form:
REGISTERED REGISTERED
No. R-
UNITED STATES OF AMERICA
STATE OF UTAH
COUNTY OF GRAND
CITY OF MOAB
WASTEWATER REVENUE BOND, SERIES 2016
THIS BOND HAS BEEN DESIGNATED BY THE AUTHORITY AND THE CITY FOR PURPOSES OF THE
EXCEPTION CONTAINED IN SECTION 265(b)(3) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, RELATING TO THE DEDUCTIBILITY OF A FINANCIAL INSTITUTION'S INTEREST
EXPENSE ALLOCABLE TO TAX-EXEMPT INTEREST.
Principal Sum
$10,400,000.00
Interest Rate
1.15%
Original Issue Date
September 9, 2016
The City of Moab, Grand County, Utah (the "Issuer") for value received, promises to pay,
but solely in the manner and from the revenues and sources hereinafter provided, to the State of Utah
Water Quality Board (the "Water Quality Board"), or registered assigns, the Total Principal Sum set
forth in the Certificate of Dates of Payment and Amount attached to this Bond and hereby made a
part hereof, but in any event not more than a maximum principal amount of TEN MILLION FOUR
HUNDRED THOUSAND ($10,400,000.00) DOLLARS, payable in installments on May 1 of each
of the years set forth below:
Maturity Date Principal Interest Total
May 1st Amount Amount Amount
2017 $ 0.00 varies varies
2018 $ 0.00 varies varies
2019 $465,000.00 $119,600.00 $584,600.00
2020 $470,000.00 $114,253.00 $584,253.00
2021 $476,000.00 $108,848.00 $584,848.00
8
2022 $481,000.00 $103,374.00 $584,374.00
2023 $487,000.00 $ 97,842.00 $584,842.00
2024 $492,000.00 $ 92,242.00 $584,242.00
2025 $498,000.00 $ 86,584.00 $584,584.00
2026 $504,000.00 $ 80,857.00 $584,857.00
2027 $510,000.00 $ 75,061.00 $585,061.00
2028 $516,000.00 $ 69,196.00 $585,196.00
2029 $522,000.00 $ 63,262.00 $585,262.00
2030 $528,000.00 $ 57,259.00 $585,259.00
2031 $534,000.00 $ 51,187.00 $585,187.00
2032 $540,000.00 $ 45,046.00 $585,046.00
2033 $547,000.00 $ 38,836.00 $585,836.00
2034 $553,000.00 $ 32,545.00 $585,545.00
2035 $559,000.00 $ 26,186.00 $585,186.00
2036 $566,000.00 $ 19,757.00 $585,757.00
2037 $572,000.00 $ 13,248.00 $585,248.00
2038 $580,000.00 $ 6,670.00 $586,670.00
To each installment of principal there shall be added interest, at the rate of One and Fifteen -
Hundredths (1.15%) per cent per annum, accruing from the date of issuance, on the entire balance
remaining due under this Bond. Interest shall be payable on the same day as the due date for a
payment of principal, provided, however, that there shall also be a payment of interest -only on May
1, 2017 and May 1, 2018..
If less than the Maximum Principal Amount is advanced, the principal amount payable on
the due date shall be the total unpaid principal sum set forth in the "Treasurer's Certificate of Dates
of Payment and Amount". The Issuer shall pay the Installment Amounts on each Payment Date
thereafter and liability of Issuer shall continue until the Total Principal Sum, together with accrued
interest, if any, shall be paid in full, irrespective of the initial amount advanced by the Purchaser.
Any installment of principal and/or interest hereof which shall not be paid when due shall
bear interest at the rate of eighteen (18%) per cent per annum from the date of maturity of such
installment until paid. This Bond is payable in lawful money of the United States of America by
check or draft of the Issuer mailed to the State of Utah Water Quality Board, Salt Lake City, Utah,
or its designee, or to such other registered owner hereof, as such registered owner is shown on the
registration books maintained by the Issuer at the close of business on the fifteenth day of the month
next preceding each installment payment date at the address of such registered owner as it appears
on such registration books or to such other address as is furnished in writing by such registered
owner to the Issuer. The registered owner of this Bond, by acceptance hereof, agrees that such
registered owner shall endorse each payment received on the Payment Record attached hereto.
Payments received on this Bond shall be applied first to the payment of interest payable and then to
principal.
9
THE ISSUER IS OBLIGATED TO PAY PRINCIPAL OF AND INTEREST, IF
ANY, ON THIS BOND SOLELY FROM THE REVENUES (THE "REVENUES")
DERIVED FROM THE ISSUER'S SEWER AND WASTEWATER SYSTEM
("SYSTEM") AND OTHER FUNDS OF THE ISSUER PLEDGED THEREFOR
UNDER THE TERMS OF THE MASTER RESOLUTION (AS HEREINAFTER
DEFINED). THIS BOND IS NOT A DEBT OF THE ISSUER WITHIN THE
MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATION ON
INDEBTEDNESS. PURSUANT TO THE MASTER RESOLUTION, REVENUES
FROM THE SYSTEM HAVE BEEN PLEDGED AND WILL BE SET ASIDE
INTO SPECIAL FUNDS BY THE ISSUER TO PROVIDE FOR THE PROMPT
PAYMENT OF THE PRINCIPAL OF, PREMIUM, IF ANY, AND INTEREST, IF
ANY, ON THIS BOND.
This Bond is issued in conformity with and after full compliance with the Constitution of the
State of Utah and pursuant to the provisions of the Act (as hereinafter defined) and all other laws
applicable thereto.
This Bond is a special obligation of the Issuer and is the only one of an issue of a total series
of fully -registered Wastewater Revenue Bond, designated as "Wastewater Revenue Bond, Series
2016", in the aggregate principal amount of $10,400,000, dated as of the date set forth below and is
issued under, by virtue of, in full conformity with and after full compliance with the Constitution and
laws of the State of Utah, including particularly the Utah Local Government Bonding Act, Chapter
14 of Title 11, Utah Code Annotated 1953, as amended, the Registered Public Obligations Act,
Chapter 7 of Title 15, Utah Code Annotated,1953, as amended, (collectively the "Act") and a Master
Resolution duly adopted by the City Council of the Issuer (the "Governing Body") on August 20,
2016, authorizing this Bond (the "Master Resolution"), for the purpose of paying all or part of the
cost of construction of wastewater system improvements, including construction of a wastewater
treatment plant, together with all necessary or related work and improvements (the "Project")
including, without limitation, all fees and expenses reasonably incurred in connection therewith and
with the issuance of such bonds as may be properly payable from the proceeds thereof. Principal on
this Bond is payable solely from the revenues, funds and other monies pledged or provided therefor
under the terms of the Master Resolution.
This Bond is dated as of date of delivery and is duly issued under and by virtue of the Act
and under and pursuant to the Master Resolution. A copy of the Master Resolution is on file at the
office of the City Recorder of the Issuer in Moab, Utah, and reference to the Master Resolution and
to the Act is made for a description of the pledge and covenants securing the Series 2016 Bond, the
nature, manner and extent of enforcement of such pledge and covenants, the terms and conditions
upon which the Bond is issued and a statement of the rights, duties, immunities and obligations of
the Issuer. Such pledge and other obligations of the Issuer under the Master Resolution may be
discharged at or prior to the maturity or redemption of the Series 2016 Bond upon the making of
provision for the payment thereof on the terms and conditions set forth in the Master Resolution.
10
To the extent and in the respects permitted by the Master Resolution, the Master Resolution
may be modified or amended by action on behalf of the Issuer taken in the manner and subject to the
conditions and exceptions prescribed in the Master Resolution. The holder or owner of this Bond
shall have no right to enforce the provisions of the Master Resolution or to institute action to enforce
the pledge or covenants made therein or to take any action with respect to an event of default under
the Master Resolution or to institute, appear in, or defend any suit or other proceeding with respect
thereto, except as provided in the Master Resolution.
This Bond is transferable, as provided in the Master Resolution, only upon the books of the
Issuer kept for that purpose at the office of the City Recorder of the Issuer by the registered owner
hereof in person or by his attorney duly authorized in writing. The Issuer may treat and consider the
person in whose name this Series 2016 Bond is registered as the holder and absolute owner hereof
for the purpose of receiving payment of, or on account of, the principal or redemption price hereof,
and interest, if any, payable hereon and for all other purposes whatsoever.
Subject to the provisions of the Master Resolution, the Series 2016 Bond is issuable in fully
registered form, without coupons, in a denomination equal to the aggregate principal amount of the
Series 2016 Bond or, upon exchange, in the denomination of $1000 and any integral multiple
thereof.
This Bond is subject to redemption at any time at the option of the Issuer in whole or in part
(if in part, in integral multiples of $1000) in inverse order of the due date of the principal
installments hereon, upon notice given as hereinafter set forth, at a redemption price equal to the
principal amount to be so redeemed, and without premium. The registered owner of this Series 2016
Bond, by acceptance hereof, agrees to endorse each such redemption on the Prepayment Record
attached hereto.
Notice of redemption shall be given by the Issuer by registered mail, not less than 30 days
nor more than 45 days prior to the redemption date, to the registered owner of this Bond, at his
address as it appears on the bond registration books of the Issuer, or at such address as he may have
filed with the Issuer for that purpose. Each notice of redemption shall state the redemption date and
the principal amount to be redeemed.
If notice of redemption shall have been given as aforesaid, the Bond or portions thereof
specified in said notice shall become due and payable at the applicable redemption price on the
redemption date therein designated.
Except as otherwise provided herein and unless the context clearly indicates otherwise, words
and phrases used herein shall have the same meanings as such words and phrases in the Master
Resolution.
In accordance with Section 265 of the 1986 Internal Revenue Code, the Issuer designates this
Bond as an issue qualifying for the exception to the rule denying banks and other financial
11
institutions the deduction for interest expenses allocable to tax-exempt interest. The Issuer
reasonably anticipates that the total amount of qualified tax-exempt obligations (other than private
activity bonds as defined in Section 141 of the 1986 Internal Revenue Code) which will be issued
by the Issuer and by any aggregated issuer during the current calendar year will not exceed
$10,000,000. The total amount of obligations designated by the Issuer and all aggregated issuers for
the current calendar year does not exceed $10,000,000.
It is hereby certified and recited that all conditions, acts and things required by the
Constitution or statutes of the State of Utah or by the Act or the Master Resolution to exist, to have
happened or to have been performed precedent to or in the issuance of this Bond exist, have
happened and have been performed and that the issue of the series of Bonds of which this Bond is
a part, together with all other indebtedness of the Issuer, is within every debt and other limit
prescribed by said Constitution and statutes.
This Bond shall not be valid until the Certificate of Authentication hereon shall have been
manually signed by the Issuer.
IN WITNESS WHEREOF, the City of Moab, Grand County, Utah, has caused this Bond to
be signed by its Mayor and attested and countersigned by its City Recorder, and the official seal of
the City of Moab, Grand County, Utah, to be impressed or imprinted hereon, all as of the day
of , 2016.
ATTEST AND COUNTERSIGN:
(DO NOT SIGN -FORM ONLY)
By
City Recorder
(SEAL)
CITY OF MOAB
(DO NOT SIGN -FORM ONLY)
By
Mayor
12
Date of Registration
CERTIFICATE OF DATES OF PAYMENT AND AMOUNT
I, the undersigned duly authorized representative of the Utah Water Quality Board, hereby
certify that the Utah Water Quality Board has delivered to the Issuer the amount or amounts
indicated below on the date or dates set forth opposite such amount(s); that the amount last inserted
under the column "Total Principal Sum" is the total amount delivered to the Issuer as principal
indebtedness under this Bond. I further certify that I have received written authorization from the
Issuer to enter said amounts on this certificate.
Amount of Date of Total Principal
Payment Payment Sum
REGISTRATION CERTIFICATE
(No writing to be placed herein except by Bond Registrar.)
Name and Address of
Registered Owner Signature of Registrar
Treasurer's
Signature (SEAL)
13
PAYMENT RECORD
I, the undersigned registered owner or authorized officer of the registered owner of the bond
to which this Payment Record is attached (the "Owner"), hereby certify that the Owner has received
from the City of Moab, Grand County, Utah, the amounts indicated below on the dates set forth
opposite such amounts in repayment of the loan of $10,400,000 to the City of Moab, Grand County,
Utah, as referenced by the bond to which this Payment Record is attached, and have placed my
signature in the space provided opposite such amounts to evidence receipt of same.
As long as the State of Utah, Water Quality Board, Salt Lake City, Utah is the registered
owner of the bond to which this Payment Record is attached, the Chairman of said Board or
designee, shall sign below as the owner of such bond.
Name, Title
Remaining and Signature
Principal Unpaid of Owner
Interest Paid or Principal or Authorized
Date Due Amount Paid Prepaid Date Due Balance Officer Thereof
PREPAYMENT RECORD
I, the undersigned registered owner or authorized officer of the registered owner of the bond
to which this Payment Record is attached (the "Owner"), hereby certify that the Owner has received
from the City of Moab, Grand County, Utah, the amounts indicated below on the dates set forth
opposite such amounts in repayment of the loan of $10,400,000 to the City of Moab, Grand County,
Utah, as referenced by the bond to which this Prepayment Record is attached and have placed my
signature in the space provided opposite such amounts to evidence receipt of same.
As long as the State of Utah, Water Quality Board, is the registered owner of the Bond to
which this Prepayment Record is attached, the Chairman of said Board shall sign below as the owner
of such Bond.
Principal Due
Date
Name, Title and
Signature of Owner
Principal or Authorized
Amount Payment Balance Date Paid Officer Thereof
15
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
Insert Social Security or Other
Identifying Number of Assignee
(Please Print or Typewrite Name and Address of Assignee)
the within Bond of the City of Moab, Grand County, Utah, and does hereby irrevocably constitute
and appoint attorney to register the transfer of said Bond on the
books kept for registration thereof, with full power of substitution in the premises.
Dated: Signature:
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a member firm of The New York Stock
Exchange or a commercial bank or trust company.
NOTICE: The signature to this assignment must correspond with the name of the registered
owner as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatever.
16
Section 2.07. Exchange of the Series 2016 Bond for Serial Bonds.
(a) It is recognized that the Water Quality Board may sell or otherwise transfer
the Series 2016 Bond pursuant to the provisions of the State Financing Consolidation Act, Title 63,
Chapter 65, Utah Code Annotated, 1953, as amended, or otherwise. The Series 2016 Bond may be
exchanged at the office of the Issuer for a like aggregate principal amount of Serial Bonds in
accordance with the provisions of Section 2.07 hereof. Serial Bonds shall be substantially in the
form set forth in Section 2.07(b) hereof. Each Principal Installment on the Series 2016 Bond not
previously paid or cancelled shall be represented by an equivalent principal amount of Serial Bonds,
in authorized denominations and of like maturity. The Issuer and its officers shall execute and
deliver such documents and perform such acts as may reasonably be required by the Issuer to
accomplish the exchange of the Series 2016 Bond for Serial Bonds and the Issuer shall pay or cause
to be paid all costs and other charges incident to such exchange.
(b) Form of Serial Bond. The Serial Bond shall be in substantially the following
form:
REGISTERED
No. R-
UNITED STATES OF AMERICA
STATE OF UTAH
COUNTY OF GRAND
CITY OF MOAB
WASTEWATER REVENUE BOND, SERIES 2016
REGISTERED
$
[SEE REVERSE INTEREST MATURITY DATED
SIDE FOR RATE DATE DATE
ADDITIONAL
PROVISIONS] 1.15% May 1, , 20_
Registered Owner:
Principal Amount: DOLLARS
KNOW ALL MEN BY THESE PRESENTS that the City of Moab, Grand County, Utah (the
"Issuer"), acknowledges itself indebted and for value received hereby promises to pay, but solely in
the manner and from the revenues and sources hereinafter provided, to the registered owner
identified above, or registered assigns, on the maturity date specified above, upon presentation and
surrender hereof, the principal amount identified above, and in like manner to pay interest thereon
17
accruing from , 20 at the Interest Rate specified above (calculated on the
basis of a 360-day year of twelve thirty -day months), payable on May 1 of each year (each an
"Interest Payment Date") commencing 1, 20, except as the provisions hereinafter set forth
with respect to prepayment of this Series 2016 Bond may become applicable hereto. If the principal
amount of this Bond and any installment of interest is not paid when due, said principal and interest
shall bear interest at the rate of eighteen (18%) per annum from said due date until paid. Principal
of and interest on this Bond shall be payable at the office of the registered owner. The principal of
and interest, if any, on this Bond shall be payable in any coin or currency of the United States of
America which, at the respective dates of payment thereof, is legal tender for the payment of public
and private debts. Payments received on this Bond shall be applied first to the payment of interest
payable and then to principal.
THE ISSUER IS OBLIGATED TO PAY PRINCIPAL OF, PREMIUM, IF ANY,
AND INTEREST, IF ANY, ON THIS BOND SOLELY FROM THE REVENUES
(THE "REVENUES") DERIVED FROM THE ISSUER'S SEWER AND
WASTEWATER SYSTEM ("SYSTEM") AND OTHER FUNDS OF THE ISSUER
PLEDGED THEREFOR UNDER THE TERMS OF THE MASTER RESOLUTION
(AS HEREINAFTER DEFINED). THIS BOND IS NOT A DEBT OF THE ISSUER
WITHIN THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY
LIMITATION ON INDEBTEDNESS. PURSUANT TO THE MASTER
RESOLUTION, REVENUES FROM THE SYSTEM HAVE BEEN PLEDGED
AND WILL BE SET ASIDE INTO SPECIAL FUNDS BY THE ISSUER TO
PROVIDE FOR THE PROMPT PAYMENT OF THE PRINCIPAL OF, PREMIUM,
IF ANY, AND INTEREST, IF ANY, ON THIS BOND AND ALL BONDS OF THE
SERIES OF WHICH IT IS A PART.
This Bond and the issue of Bonds of which it is a part are issued in conformity with and after
full compliance with the Constitution of the State of Utah and pursuant to the provisions of the Act
(as hereinafter defined) and all other laws applicable thereto.
THE TERMS AND PROVISIONS OF THIS BOND ARE CONTINUED ON THE
REVERSE SIDE OR AT THE END HEREOF AND SUCH CONTINUED TERMS AND
PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY
SET FORTH AT THIS PLACE.
It is hereby certified and recited that all conditions, acts and things required by the
Constitution or statutes of the State of Utah or by the Act or the Master Resolution to exist, to have
happened or to have been performed precedent to or in the issuance of this Bond exist, have
happened and have been performed and that the issue of the series of Bonds of which this Bond is
a part, together with all other indebtedness of the Issuer, is within every debt and other limit
prescribed by said Constitution and statutes.
This Bond shall not be valid until the Certificate of Authentication hereon shall have been
18
manually signed by the Issuer.
IN WITNESS WHEREOF, the City of Moab, Grand County, Utah, has caused this Bond to
be signed in its name and on its behalf by its Mayor and [a facsimile of] its corporate seal to be
[imprinted] [impressed] hereon and attested and countersigned by its City Recorder [(the signatures
of said Mayor and City Recorder being by facsimile), and said officials by the execution hereof do
adopt as for their own proper signatures their facsimile signatures appearing on each of the Bonds],
all as of the Issue Date specified above.
CITY OF MOAB
(FORM ONLY -DO NOT SIGN)
By
ATTEST AND COUNTERSIGN: Mayor
(FORM ONLY -DO NOT SIGN)
By
City Recorder
(SEAL)
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in the within mentioned Master Resolution and is
one of the Wastewater Revenue Bond, Series 2016, of the City of Moab, Grand County, Utah.
Date of Registration and Authentication:
Bond Registrar and Paying Agent:
City of Moab
CITY OF MOAB
as Bond Registrar
By
City Recorder
19
[FORM OF REVERSE SIDE OF OR TO BE APPENDED TO THE BONDS]
This Bond is a special obligation of the Issuer and is one of an issue of a total series of fully -
registered Wastewater Revenue Bonds, designated as "Wastewater Revenue Bonds, Series 2016,"
in the aggregate principal amount of $ dated as of the date set forth below, issued under,
by virtue of, in full conformity with and after full compliance with the Constitution and laws of the
State of Utah, including particularly the Utah Local Government Bonding Act, Chapter 14 of Title
11, Utah Code Annotated 1953, as amended, the Registered Public Obligations Act, Chapter 7 of
Title 15, Utah Code Annotated 1953, as amended, and a Master Resolution duly adopted by the City
Council of the Issuer (the "Governing Body") on August 20, 2016, authorizing this Bond (the
"Master Resolution"), for the purpose of paying all or part of the cost of construction of wastewater
system improvements, including construction of a wastewater treatment plant, together with all
necessary or related work and improvements (the 'Project") including, without limitation, all fees
and expenses reasonably incurred in connection therewith and with the issuance of such bonds as
may be properly payable from the proceeds thereof. Principal of, premium, if any, and interest, if
any, on this Bond is payable solely from the revenues, funds and other monies pledged or provided
therefor under the terms of the Master Resolution.
To the extent and in the respects permitted by the Master Resolution, the Master Resolution
may be modified or amended by action on behalf of the Issuer taken in the manner and subject to the
conditions and exceptions prescribed in the Master Resolution. The holder or owner of this Bond
shall have no right to enforce the provisions of the Master Resolution or to institute action to enforce
the pledge or covenants made therein or to take any action with respect to an event of default under
the Master Resolution or to institute, appear in, or defend any suit or other proceeding with respect
thereto, except as provided in the Master Resolution.
The Bonds are dated as of , 2016 and are duly issued under and by virtue
of the Act and under and pursuant to the Master Resolution. A copy of the Master Resolution is on
file at the office of the City Recorder of the Issuer in Moab, Utah, and reference to the Master
Resolution and to the Act is made for a description of the pledge and covenants securing the Bonds,
the nature, manner and extent of enforcement of such pledge and covenants, the terms and conditions
upon which the Bonds are issued and a statement of the rights, duties, immunities and obligations
of the Issuer. Such pledge and other obligations of the Issuer under the Master Resolution may be
discharged at or prior to the maturity or redemption of the Bonds upon the making of provision for
the payment thereof on the terms and conditions set forth in the Master Resolution.
This Bond is transferrable, as provided in the Master Resolution, only upon the books of the
Issuer kept for that purpose at the office of the City Recorder of the Issuer, by the registered owner
hereof in person or by his attorney duly authorized in writing, upon surrender hereof together with
a written instrument of transfer in a form approved by the Issuer, duly executed by the registered
owner or his duly authorized attorney, and thereupon the Issuer shall issue in the name of the
transferee a new registered Bond or Bonds of the same aggregate principal amount, series
20
designation and maturity as the surrendered Bond, all as provided in the Master Resolution and upon
the payment of the charges therein prescribed. The Issuer, the Trustee, and any paying agent may
treat and consider the person in whose name this Bond is registered as the holder and absolute owner
hereof for the purpose of receiving payment of, or on account of, the principal or redemption price
hereof, and interest, if any, payable hereon and for all other purposes whatsoever.
Subject to the provisions of the Master Resolution, the Bonds are issuable in fully registered
form, without coupons, in the denomination of $1000 and any integral multiple thereof.
The Bonds are subject to redemption at any time at the option of the Issuer in whole or in part
(if in part, in integral multiples of $1000) in inverse order of maturity upon notice given as
hereinafter set forth, at a redemption price equal to the principal amount of each Bond or portion
thereof to be so redeemed, and without premium.
If less than all of the Bonds of any maturity are to be redeemed, the particular Bonds to be
redeemed shall be selected as provided in the Master Resolution; provided, however, that subject to
other applicable provisions of the Master Resolution, the portion of any Bond to be redeemed shall
be in a principal amount equal to a denomination in which the Bond was authorized to be issued, and
that in selecting Bonds for redemption, the Issuer shall treat each Bond as representing that number
of Bonds which is obtained by dividing the principal amount of such Bond by $1000. If part but not
all of a Bond in a denomination in excess of $1000 is to be redeemed, the registered owner thereof
shall present and surrender such Bond to the Issuer, and the Issuer shall execute and authenticate and
deliver to the registered owner thereof, without charge therefor, a Bond or Bonds of the same
maturity for unredeemed balance of the principal amount of such Bond, all as more fully set forth
in the Master Resolution.
Notice of redemption shall be given by the Issuer by registered mail, not less than 30 days
nor more than 45 days prior to the redemption date, to the registered owner of this Bond, at his
address as it appears on the bond registration books of the Issuer, or at such address as he may have
filed with the Issuer for that purpose. Each notice of redemption shall state the redemption date and
the principal amount and, if less than all of the Bonds are to be redeemed, the distinctive numbers
of the Bonds to be redeemed.
If notice of redemption shall have been given as aforesaid, the Bonds or portions thereof
specified in said notice shall become due and payable at the applicable redemption price on the
redemption date therein designated.
Except as otherwise provided herein and unless the context clearly indicates otherwise, words
and phrases used herein shall have the same meanings as such words and phrases in the Master
Resolution.
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[FORM OF ASSIGNMENT]
The following abbreviations, when used in the inscription on the face of the within Bond,
shall be construed as though they were written out in full according to applicable laws or regulations.
TEN COM- as tenants in common
TEN ENT- as tenants by the entireties
JT TEN- as joint tenants with right of survivorship and not as tenants in common
UNIF GIFT MIN ACT- Custodian
(Cust) (Minor)
Under Uniform Gifts to Minors Act
(State)
Additional abbreviations may also be used though not in the list above.
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
Insert Social Security or Other
Identifying Number of Assignee
(Please Print or Typewrite Name and Address of Assignee)
the within Bond of the City of Moab, Grand County, Utah and does hereby irrevocably constitute
and appoint attorney to register the transfer of said Bond on the books kept for
registration thereof, with full power of substitution in the premises.
Dated: Signature:
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a member firm of The New York Stock
Exchange or a commercial bank or trust company.
NOTICE: The signature to this assignment must correspond with the name of the registered
owner as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatever.
22
Section 2.08. Provisions for the registration of the Series 2016 Bond shall be pursuant to
Section 3.01 hereof.
ARTICLE III
SALE OF BONDS; CONSTRUCTION FUND; SYSTEM OF REGISTRATION
Section 3.01 Sale of Bonds; Construction Fund.
(a) The sale of the Bond to the Water Quality Board at a price equal to the Issue
Amount is hereby approved, ratified and confirmed. The Bond shall be delivered to the Water
Quality Board as soon as may be conveniently done hereafter. The purchase price for the Bond will
be deposited with the Escrow Agent, to be held by the Escrow Agent in accordance with the
provisions of this Master Resolution and the Escrow Agreement.
(b) Proceeds of the sale of the Bond shall be paid into and disbursed from a special
fund held by the Escrow Agent in the Escrow Account heretofore established and confirmed and to
be known as the Construction Fund. Money in the Construction Fund shall be held, used and paid
out solely for the purpose set out in Section 2.01 hereof or to prepay the Bond as hereinafter
provided, pursuant to the provisions of the Constitution and laws of the State of Utah and the
provisions of the Escrow Agreement, which provisions shall include a requirement that each
disbursement of monies from the Construction Fund shall be made only upon the written
authorization of the State and the Issuer in the manner provided in the Escrow Agreement. Monies
held in the Construction Fund shall be invested as provided in the Escrow Agreement.
(c) Upon completion of the Project, the Issuer shall immediately notify the Water
Quality Board in writing of such completion and shall immediately transfer, or cause the Escrow
Agent to immediately transfer, in the manner set forth in the Escrow Agreement, any funds
remaining in the Construction Fund to the Bond Fund. Such funds shall be used to the fullest extent
possible and as soon as possible hereunder, to prepay principal installments on the Bond in the
manner set forth in this Master Resolution by applying such amounts against principal installments
in inverse order of maturity.
(d) Any unexpended bond proceeds remaining in said Escrow Account after
completion of the Project shall be paid immediately into the "City of Moab, Grand County, Utah,
2016 Bond Wastewater Revenue Fund" hereafter described. The said unexpended proceeds shall
be used only for the prepayment of amounts of principal due or to become due on the Bonds in
inverse order of maturities or for redemption of any Serial Bonds at a price (exclusive of accrued
interest) not exceeding the face amount thereof and as provided in the Escrow Agreement.
Section 3.02. Registration and Exchange of Bonds.
(a) This Article shall constitute a system of registration within the meaning and for
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the purpose of Chapter 7 of Title 15, Utah Code Annotated, 1953, as amended. The Issuer shall
cause books for the registration and for the transfer of any Bond to be kept at the office of its City
Recorder.
(b) Upon surrender for transfer of a Bond at the office of the Issuer, duly endorsed
by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the
Issuer and duly executed by the registered owner or his attorney duly authorized in writing, the City
Recorder or other duly authorized official of the Issuer shall note the name of the transferee or
transferees and the date of the transfer in the place provided on the back of a Bond and shall affix
his or her official signature thereon. The City Recorder shall thereupon deliver a Bond to the
transferee and shall enter in the registration books of the Issuer the name and address of the
transferee.
(c) The Issuer shall not be required to transfer a Bond during the period from the
fifteenth day of the month next proceeding any Payment Date on a Bond to and including such
Payment Date, nor to transfer a Bond during a period of 15 days next preceding mailing of a notice
of prepayment of any installment, or portion thereof, on a Bond.
(d) The person in whose name a Bond shall be registered shall be deemed and
regarded as the absolute owner thereof for all purposes and the Issuer shall not be affected by any
notice to the contrary. Payment of the principal of, and interest, if any, on a Bond shall be made only
to or upon the order of the registered owner thereof or his legal representative. All such payments
shall be valid and effectual to satisfy and discharge the liability upon a Bond to the extent of the sum
or sums so paid.
(e) No service charge shall be made by the Issuer for any transfer of any Bond but
the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any transfer of a Bond.
(f) Prior to making any transfer of any Bond as provided in this Section, the City
Recorder shall verify that the payment record and prepayment record attached to a Bond have been
accurately completed as of the date of such transfer and, if necessary, conform such payment record
and prepayment record to accurately reflect all payments of principal on a Bond, based on the records
and information with respect to such Bond maintained by the Issuer and the registered owner
surrendering such Bond.
Section 3.03. Mutilated, Lost, Destroyed or Stolen Bonds. If a Bond shall become mutilated,
the Issuer, at the expense of the registered owner thereof, shall execute and deliver a new Bond of
like tenor in exchange for the Bond so mutilated, but only upon surrender to the Treasurer of the
Bond so mutilated, which Bond shall thereupon be cancelled by the Issuer. If a Bond shall be lost,
destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Issuer and
if such evidence be satisfactory and given, the Issuer, at the expense of the registered owner thereof,
shall execute and deliver a new Bond of like tenor in lieu of and in substitution for the Bond so lost,
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destroyed or stolen (or if the entire principal amount of the Bond shall have matured or shall be about
to mature, instead of issuing a substitute Bond, the Issuer may pay the same without surrender
thereof). Any Bond issued under the provisions of this Section in lieu of a Bond alleged to be lost,
destroyed or stolen shall constitute an additional contractual obligation of the Issuer and shall be
equally and proportionately entitled to the benefits of this Master Resolution. The Issuer shall not
be required to treat both the original Bond and the duplicate Bond as being Outstanding for the
purpose of determining the principal amount of the Bond and Parity Bonds which may be issued
under this Master Resolution or for the purpose of determining any percentage of the Bond or Parity
Bonds Outstanding under this Master Resolution, but both the original and duplicate Bond shall be
conformed by the City Recorder to accurately reflect all payments of principal on the lost, destroyed
or stolen Bond, based on the records and information with respect to such lost, destroyed or stolen
Bond maintained by the Issuer and the registered owner of the Bond.
ARTICLE IV
FLOW OF FUNDS
Section 4.01. Pledge Effected by the Master Resolution.
(a) The Series 2016 Bond is a special obligation of the Issuer payable from and
secured by the Revenues and on a par with the Prior Lien Bond, the lien thereof on the Revenues and
the Resolutions authorizing the Prior Lien Bond. There is hereby pledged for the payment of the
principal of, prepayment premium, if any, and interest, if any, on the Bonds in accordance with their
terms and the provisions of this Master Resolution, subject only to the provisions of this Master
Resolution permitting the application thereof for the purposes and on the terms and conditions set
forth in this Master Resolution, (i) the proceeds of sale of the Bonds, (ii) the Revenues, and (iii) all
funds established hereunder, including the investments, if any, thereof.
(b) In no event shall the Bond be deemed or construed to be a general indebtedness
of the Issuer or payable from any funds of the Issuer other than those derived from the operation of
the System.
Section 4.02. Establishment of Funds. The following funds are hereby established and
confirmed:
(1) Construction Fund, to be held by the Escrow Agent;
(2) Revenue Fund, to be held by the Issuer;
(3) Bond Fund, to be held by the Issuer;
(4) Reserve Fund, to be held by the Issuer; and
(5) Emergency Repair and Replacement Fund, to be held by the Issuer.
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Section 4.03. Revenue Fund.
(a) There shall be deposited into the Revenue Fund, as received, the Revenues of the
System. The Revenue Fund shall be deposited with the Depository and the monies credited to said
Revenue Fund shall be expended only in the manner herein specified.
(b) Expenses of Maintenance and Operation shall be paid by the Issuer from time to
time as they become due and payable and shall be a first charge on the Revenue Fund.
Section 4.04. Flow of Funds.
(a) After payment of Expenses of Maintenance and Operation then due the Issuer
shall transfer, or cause the Depository to transfer, to the extent of monies available in the Revenue
Fund, to the following funds in the following order the amounts set forth below:
(1) In the Bond Fund, in each month so long as the Bond is outstanding, (i) one -
twelfth of the sum of the amount of principal, and interest, if any, falling due on the Series
2016 Bonds, plus (ii) all required payments on the Prior Lien Bond.
(2) In the Reserve Fund, (i) on a monthly or annual basis such amounts as required
to satisfy the Reserve Fund Requirement with respect to each of the Prior Lien Bonds, and
(ii) a sum equal to the Reserve Fund Installment so as to cause to be on deposit in the
Reserve Fund an amount equal to the Reserve Fund Requirement not later than 72 months
following the commencement of such monthly transfers.
If monies shall ever be paid out of the Reserve Fund, monies shall be deposited, in
addition to other deposits required by this paragraph (2), into the Reserve Fund from
available Revenues (after making all other payments of Expenses of Maintenance and
Operation and deposits into the Bond Fund heretofore provided in this Section) to the extent
necessary to cause the amount paid out to be replaced; and
(3) With respect to the Series 2016 Bond, the sum of $4,063 each month shall be
deposited into the Emergency Repair and Replacement Fund created herein, beginning the
month next following the month in which the Bond is issued hereunder until a total of
$292,531 is accumulated but not later than 72 months following the commencement of such
monthly transfers; provided, however, that if monies shall ever be paid out of a given
Emergency Repair and Replacement Fund, monies shall be deposited, in addition to other
deposits required by this paragraph (3), into the Emergency Repair and Replacement Fund
from available Revenues (after making all other payments of Expenses of Maintenance and
Operation and deposits into the Emergency Repair and Replacement Fund heretofore
provided in this Section) to the extent necessary to cause the amount paid out to be replaced.
If available Revenues in the Revenue Fund (after payment of Expenses of Maintenance and
26
Operation and deposits into the Bond Fund) are not sufficient to allow the deposit of the full amount
of the applicable Reserve Fund Installments to the Reserve Fund created herein, the Reserve Fund
for the Prior Lien Bond as set forth above, then those available revenues shall be allocated among
the Reserve Funds on a pro rata basis, based upon the relative Reserve Fund Installments for each
such Reserve Fund. In addition, if amounts are subsequently withdrawn from the Reserve Fund as
provided in Section 4.06, the Issuer shall thereafter make deposits from first available Revenues to
the Reserve Fund created herein, the Reserve Funds created under the resolution authorizing the
Prior Lien Bond, in such amounts as is necessary to restore the amounts withdrawn; provided,
however, that such deposits shall be made on a pro rata basis among said Reserve Funds until the
amounts withdrawn have been fully restored.
(b) Amounts remaining in the Revenue Fund on the final day of each month in each
year after payment of the amounts required by paragraphs (1) through (3) subsection (a) of this
Section and not required to meet Expenses of Maintenance and Operation or used for remedying any
deficiencies in the payments previously made to the funds herein established, may be used, at the
option of the Issuer and to the extent permitted by law, (1) to purchase or prepay any Bond in
accordance with the provisions hereof governing prepayment of the Bond authorized hereunder in
advance of maturity or, in the case of Future Parity Bonds, in accordance with the provisions of the
resolution authorizing such Future Parity Bonds governing prepayment of such Future Parity Bonds
in advance of maturity, including payment of expenses in connection with such purchase or
prepayment; (2) to pay the principal, or prepayment price of and interest on any bonds, including
general obligation or junior lien revenue bonds of the Issuer issued to acquire, construct, improve
or extend the System; (3) to pay the costs of capital improvements to the System; and (4) for any
other lawful purpose, including, without limitation, payment of other obligations of the Issuer.
Section 4.05. Bond Fund. Monies in the Bond Fund shall be used for the purpose of paying
principal, prepayment premium, if any, and any applicable interest when due on the Bond. The Bond
Fund shall be kept on deposit with the Depository.
Section 4.06. Reserve Fund. In the event that the money on deposit in the Bond Fund on the
final day of any month is less than the amount required to be in such Bond Fund pursuant to Section
4.04(a)(1) hereof, then the Issuer shall cause any funds on deposit in the respective Reserve Fund
to be immediately transferred by the Depository to such corresponding Bond Fund in the amount
required to eliminate the deficiency in such Bond Fund(s). The Reserve Fund shall be kept on
deposit with the Depository.
Section 4.07. Emergency Repair and Replacement Fund. (a) The amounts in the Emergency
Repair and Replacement Fund shall, from time to time, be applied upon the written request of the
Issuer, to the payment of (i) extraordinary operation and maintenance costs, (ii) contingencies,
including the prevention or correction of any unusual loss or damage to the System to the extent not
covered by the proceeds of insurance or other monies recoverable as a result thereof, or (iii)
construction, including extensions, repairs or replacements to the System as shall be necessary,
proper or convenient to insure the continued and efficient operation thereof and/or the capacity of
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the system to earn Revenues.
(b) If on the final day of any month the amount required to be in the Bond Fund shall
be less than the amount required to be on deposit therein pursuant to Section 4.04(a)(1) hereof and
there shall not be on deposit in the Reserve Funds sufficient monies to cure such deficiency, the
Issuer shall transfer from the Emergency Repair and Replacement Fund the amount necessary (or
all the monies in the Emergency Repair and Replacement Fund, if less than the amount necessary)
to make up such deficiency.
(c) Upon payment in full of the Bond, or when funds are available to pay in full all
Outstanding Bonds as provided in Section 4.09 hereof, any amount remaining in the Emergency
Repair and Replacement Fund may be withdrawn by the Issuer and used for any lawful purpose of
the Issuer.
Section 4.08. Investment of Funds. All money maintained on deposit with the Depository
shall be held as special and not as general deposits, the beneficial interest in which shall be in the
registered owners from time to time of the Bond. All money so maintained on deposit with the
Depository shall be secured to the fullest extent required or permitted by the laws of the State of
Utah pertaining to the securing of public deposits. All or part of the money in the Bond Fund and
in the Reserve Fund shall be invested by the Depository, at the direction of the Issuer, in Permitted
Investments, but any such investments so made shall always be such that the obligations mature or
become optional for redemption in amounts and at times so as to assure the availability of the
proceeds thereof when needed for the purpose for which such funds were created. Interest received
on all such investments permitted hereunder shall be deposited in the Revenue Fund, except that at
any time less than the required amount is on deposit in either the Bond Fund or the Reserve Fund,
then interest attributable to such fund, respectively, shall be deposited into such fund. Whenever any
money so invested from the Bond Fund or the Reserve Fund is needed for the purpose for which
such fund was created, such investments, to the amount necessary, shall be liquidated by the
Depository at the direction of the Issuer, and the proceeds thereof applied to the required purpose.
Section 4.09. Use of Funds When Reserves Sufficient to Pay Outstanding Bonds. Provided
all principal and interest on the Prior Lien Bond have been paid in full and whenever there is
sufficient available money in the Bond Fund and in the Reserve Fund to pay in full all principal and
interest under this Bond and all Bonds in accordance with their terms and the terms of this Master
Resolution or, in the case of Future Parity Bonds, the resolution authorizing the issuance of such
Future Parity Bonds, the money in such funds shall be used for such purpose and no other purpose
but no additional payments need to be made into either fund unless necessary to replace monies lost
or otherwise dissipated therefrom. If all payments of principal and interest under the Bond
authorized by this Master Resolution are fully paid before the Prior Lien Bond are fully paid, all
payments required under the Master Resolution authorizing the Prior Lien Bond shall be paid into
the Bond and Reserve Funds until the Prior Lien Bond are satisfied in full or defeased.
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ARTICLE V
COVENANTS AND UNDERTAKINGS
Section 5.01. Punctual Payment. The Issuer will punctually pay or cause to be paid the
principal, the prepayment premium, if any, and any applicable interest when due on the Series 2016
Bond and the Prior Lien Bond, in strict conformity with the terms of the Series 2016 Bond and the
Prior Lien Bond and of this Master Resolution or, in the case of Future Parity Bonds, the resolution
authorizing the issuance of such Future Parity Bonds, according to the true intent and meaning
thereof. The Issuer agrees that there shall be no grace period as to the date of any payment required
to be made pursuant to the terms of the Bond and of this Master Resolution or, in the case of Future
Parity Bonds, the resolution authorizing the issuance of such Future Parity Bonds.
Section 5.02. Operation and Maintenance. The Issuer will cause the System to be operated
continuously for the furnishing of System services to the inhabitants of the Issuer, to the extent
practicable under conditions as they may from time to time exist, in an efficient and economical
manner, and will at all times cause to be maintained, preserved and kept, the System, including all
parts thereof and appurtenances thereto, in good repair, working order and condition, and in such
manner that the operating efficiency thereof will be of high character. The Issuer will from time to
time cause to be made all necessary and proper repairs and replacements so that the rights and
security of the registered owners of the Bond may be fully protected and preserved, and will
faithfully and punctually perform all duties with reference to the System required by the Constitution
and laws of the State of Utah, including the making and collecting of sufficient rates, fees and
charges as appropriate, for all services supplied by the System and the segregation and application
of the Revenues of the System in the manner provided in this Master Resolution.
Section 5.03. Compliance with Contracts and Agreements; Maintenance of Revenues.
(a) The Issuer will comply with all terms, covenants and provisions, express or
implied, of all contracts and agreements entered into by it for System use and services and all other
contracts or agreements affecting or involving the System or the business of the Issuer with respect
thereto, and will fix and collect rates, fees and charges, as appropriate for all services supplied by
the System fully sufficient, after making due allowance for delinquencies in collection, to provide
for the payment of the Expenses of Maintenance and Operation, to provide for the payment of all
obligations payable from the Revenues of the System, including the Bond, as and when the same
become due and payable, and to establish the Bond Fund and the Reserve Fund and to make the
deposits into the Bond Fund and the Reserve Fund as hereinabove required.
(b) In order to assure full and continuous performance of the covenants contained
by sub -section (a) of this Section with a margin for contingencies and temporary unanticipated
reduction in Revenues, the Issuer hereby covenants and agrees that it will, at all times while the Bond
shall be outstanding, continue in effect and establish, fix, prescribe and collect rates and charges for
the sale or use of System services furnished by the Issuer which, together with any other income, are
29
reasonably expected to yield Net Revenues equal to at least 1.25 times the aggregate annual debt
service on the Bond Outstanding for the forthcoming year and any Prior Lien Bond.
(c) If at any time the Revenues arising from such rates, fees and charges, as
appropriate, shall not be sufficient to make all such payments promptly as herein required, the Issuer
shall revise the rates, fees and charges, as appropriate, to the users of System services so that such
deficiency will be remedied before the end of the next ensuing Year. If the Issuer shall fail to revise
such charges as herein required, the registered owners of not less than ten percent (10%) in aggregate
principal amount of the Outstanding Bond, whether or not the Bond shall then be in default, shall
have authority, to the extent permitted by law, to bring an appropriate action in any court of
competent jurisdiction to compel the Governing Body to carry out the provisions of this Section.
Section 5.04. Delinquencies; Single Billing.
(a) If any delinquent charge for System services, with applicable penalty and interest,
is not paid in full within 60 days from the date on which the charge has become delinquent, the
Issuer will, when appropriate and necessary to effect collection, cause all System services to be
discontinued to the delinquent customers or premises, or forbid further use of such services by such
customers or premises, to the extent permitted by law, until such delinquency, with penalties and
interest has been paid in full. The Issuer further agrees in addition to the foregoing that it will do all
things and exercise all remedies legally available to assure the prompt payment of all charges made
for System services.
(b) The Issuer further covenants and agrees, to the extent permitted by law, that the
Issuer will bill each customer receiving System services in a single bill, will refuse to accept payment
for any of such services unless payment for the other services is also made, and if payment for any
of such services is permitted to become delinquent and remain so for a period of 60 days, will treat
such delinquency as provided in subsection (a) of this Section.
(c) If any customer or user of System services shall become delinquent for more than
six months in the payment of his charges for such services, the Issuer agrees that, in addition to all
of the remedies for which provision is made in this Master Resolution, the Issuer will proceed
immediately, and it is hereby authorized to proceed, with a suit at law or in equity against such
customer or user to recover the amount of any such delinquent charges, together with penalties and
interest to the extent permitted by law.
Section 5.05. Consideration Required for Services. The Issuer will not permit System
services to be supplied to any person, firm or corporation, public or private, or to any public agency
or instrumentality including the Issuer without due consideration to be received in exchange therefor.
Section 5.06. Observance of Laws and Regulations; Permits, Licenses and Claims.
(a) The Issuer will well and truly keep, observe and perform all valid and lawful
30
obligations or orders or regulations now and hereafter imposed on it by contract, or prescribed by
any law of the United States of America or of the State of Utah, or by any officer, board or
commission having jurisdiction or control over the Issuer or the System or both, as a condition of
the continued enjoyment of any and every right, privilege or franchise now owned or hereafter
acquired by the Issuer, including its right to exist and carry on business, to the end that such rights,
privileges and franchises shall be maintained and preserved, and shall not become abandoned,
forfeited or in any manner impaired; provided, however, that the Issuer shall not be required to
comply with any such orders so long as the validity or application thereof shall be contested in good
faith.
(b) The Issuer shall at all times undertake reasonable efforts to perfect, and protect
and maintain rights of any kind, all purchase contracts of any kind, and all permits, licenses and
claims, necessary for the operation of the System.
Section 5.07 Payment of Taxes and Claims. The Issuer will, from time to time, duly pay and
discharge, or cause to be paid and discharged, any taxes, assessments or other governmental charges
lawfully imposed upon any of the properties of the System or upon the Revenues when the same
shall become due, and will duly observe and conform to all valid requirements of any governmental
authority relative to any such properties. The Issuer will keep the System and all parts thereof free
from judgments, mechanics' and materialmen's liens (other than those arising by mere operation of
law from the construction of the Project and other improvements to the System which are promptly
discharged in due course) and free from all other liens, claims, demands and encumbrances of
whatsoever prior nature or character, to the end that the priority of the lien of this Master Resolution
on the Revenues may at all times be maintained and preserved, and free from any claim or liability
which might embarrass or hamper the Issuer in conducting its business.
Section 5.08. Accounts and Reports. The Issuer will maintain and keep proper books of
record and accounts separate and apart from all other records and accounts of the Issuer, in which
there shall be made full and correct entries of all transactions relating to the System and the
Revenues. Not later than 90 days after the close of each fiscal year, the Issuer will cause an audit
of such books and accounts to be made by an independent public accountant, or state auditing
official, if appropriate, showing the receipts of and disbursements made for the account of the
System. Each such audit, in addition to whatever matter may be thought proper by the accountant
to be included therein, shall include the following:
year;
(1) A statement in detail of the income and expenditures of the System for such fiscal
(2) A balance sheet as of the end of such fiscal year;
(3) The accountant's comments regarding the manner in which the Issuer has carried
out the requirements of this Master Resolution, and the accountant's recommendations for
any change or improvements in the operation of the System;
31
(4) A list of the insurance policies and fidelity bonds in force at the end of such fiscal
year, setting out as to each policy and bond that amount of the policy, the risks covered, the
name of the insurer and the expiration date;
(5) The number and type or class, if applicable, of customers of the System, and the
number of connections, if applicable, to the System;
(6) The amount of money in each of the funds created in Article IV hereof at the end
of such fiscal year and the amount of money paid into and expended from each of said funds
during such fiscal year;
(7) To the extent applicable, a statement of all schedules of rates in effect at the close
of the fiscal year and the aggregate dollar amount billed for the System services during such
fiscal year and the Revenues received from charges for System services by types or classes
of customers, if applicable;
(8) A list of the official titles of the Executive Officer, the City Recorder,
Treasurer and members of the Governing Body, and the name of each person
occupying said positions; and
(9) A general statement concerning any events or circumstances which might affect
the financial status of the System.
All expenses incurred in the making of the audits required herein shall be regarded and paid
as Expense of Maintenance and Operation. The Issuer further agrees to furnish a copy of each such
audit to the Water Quality Board so long as it is the registered owner of the Bond and to any
subsequent registered owner of the Bond who shall request the same in writing. Any registered
owner of the Bond shall have the right to discuss with the accountant making the audit the contents
of the audit and to ask for such additional information as he may reasonably require in connection
with such audit. The Issuer agrees that said books of record and account herein referenced, and any
and all other books, records and accounts of the Issuer relating to the System, shall at all reasonable
times be open to inspection by any registered owner of the Bond or their representatives duly
authorized in writing, during normal business hours.
Section 5.09. Insurance and Fidelity Bonds.
(a) The Issuer agrees to procure and maintain, or cause to be procured and
maintained, insurance on the System and public liability insurance in such amounts and against such
risks as are usually insurable in connection with similar systems and as is usually carried by
municipalities operating similar systems.
(b) The Issuer further agrees to procure and maintain, or cause to be procured and
maintained, adequate fidelity insurance or bonds on the positions of Executive Officer, City
32
Recorder, Treasurer and on any other person or persons handling or responsible for funds of the
Issuer related to the System.
(c) The provisions of this Section relating to the procurement and maintenance of
insurance are subject to the condition that insurance of the type described herein is obtainable at
reasonable rates and upon reasonable terms and conditions.
Section 5.10. Against Sale or Other Disposition of System Property Except Under
Conditions. The Issuer will not sell, lease, encumber, alienate or in any manner dispose of the
System or any substantial part thereof until the Bond has been paid in full; provided, however, that
nothing herein contained shall be construed to prevent disposal by the Issuer, upon prior written
notice to the registered owners of the Bond, of property which it deems has become inexpedient to
use in connection with the System, when other property of equal value is substituted therefor.
Section 5.11. Against Competition with System Services. The Issuer, so far as it legally may,
covenants and agrees that it will not operate or grant a franchise for the operation of any system
competing with the System within the boundaries of the Issuer as long as the Bond is Outstanding.
Section 5.12. Future Parity Bonds.
(a) The Issuer will issue no other bonds or obligations of any kind or nature payable
from or enjoying a lien on the Revenues, unless such other bonds or obligations are made
subordinate to the Bonds herein authorized; provided that at any time Future Parity Bonds may be
authorized by resolution of the Governing Body if all the following conditions are met:
(1) The Issuer is in full compliance with all of the covenants and undertakings in
connection with all Bonds of the Issuer then Outstanding and the Prior Lien Bond then
Outstanding and payable from the Revenues of the System;
(2) The issuance of the Future Parity Bonds shall, but only to the extent required by
law, have been duly authorized at an election held pursuant to applicable law;
(3) The Annual Net Revenues of the System for the 12 consecutive months ending
with the calendar month next preceding the adoption by the Governing Body of the
resolution authorizing the issuance and confirming the sale of the Future Parity Bonds, as
shown by an audit rendered by an independent public accountant employed by the Issuer,
when added to the estimated amount of the increase in such Annual Net Revenues for the
first full twelve-month period in which the improvements, extensions, additions or
betterments to the System to be acquired with the proceeds of the Future Parity Bonds will
be in operation (such estimated amount to be evidenced (i) by a certificate of an independent
consulting engineer approved by the Governing Body of recognized skill and experience in
the field of engineering matters related to the construction and maintenance of systems
similar to the System), are equal to at least 1.25 times the maximum annual debt service on
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(i) all Bonds (including any previously issued Future Parity Bonds) then outstanding plus (ii)
the Future Parity Bonds then proposed to be issued, plus (iii) the Prior Lien Bond;
(4) If the Future Parity Bonds are to be issued solely for the purpose of refunding a
portion of the Bonds then outstanding then, for the purpose of making the calculation
required under the foregoing paragraph, the maximum annual debt service on the
Outstanding Bonds in any future Year shall take into consideration only Bonds that will
remain outstanding after the issuance of such Future Parity Bonds, provided that if before the
issuance and delivery of such Future Parity Bonds all of the Bonds theretofore issued will
have been retired, nothing herein contained shall limit or restrict the issuance of any such
Future Parity Bonds;
(5) Future Parity Bonds may be issued only for the purpose of acquiring,
constructing, improving or extending the System, or for the purpose of refunding any
outstanding Bonds, or for any combination of such purposes;
(6) The resolution authorizing the issuance of such Future Parity Bonds shall provide
that the last maturity date of the Future Parity Bonds shall not be earlier than the last maturity
date of any Bonds theretofore issued and then outstanding and shall provide for fixed serial
maturities or mandatory minimum bond fund payments, of any combination thereof, in such
amounts as will be sufficient to provide for the payment or retirement of all such Future
Parity Bonds on or before their respective maturity dates; and
(7) The payments required to be made into the various funds provided in Article IV
hereof must be current at the time of the issuance of such Future Parity Bonds.
(b) A certificate evidencing compliance with the foregoing requirements of this
Section signed by the Executive Officer and attested and countersigned by the City Recorder shall
be delivered to the initial bondholders and to any other registered owners of the Bonds requesting
a copy thereof, prior to the issuance of any Future Parity Bonds.
Section 5.13. Rights and Remedies of Bondholders.
(a) The registered owner of any outstanding Bonds from time to time shall be
permitted the exercise of all rights and powers to which such registered owner is entitled under the
Constitution and laws of the State of Utah.
(b) In addition to all other rights afforded by the Constitution and laws of the
State of Utah, to the extent permitted by law, the Issuer agrees that the registered owner of any
outstanding Bonds shall have the right (i) to apply to and obtain from any court of competent
jurisdiction such decree or order as may be necessary to require the officials of the Issuer to charge
and collect rates for services supplied by the System sufficient to meet all requirements of this
Master Resolution, and (ii) if the Bonds shall be permitted to default as to payment of principal,
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prepayment premium, if any, and interest thereon to apply to a court of competent jurisdiction to
appoint a receiver for the System.
(c) Further, in the event of default the bondholder has the remedy to impose
interest on the total outstanding principal balance of the Bonds at the rate of 18% per annum until
the default is cured.
Section 5.14. Master Resolution to Constitute Contract Between the Issuer and the Holders
of the Bonds. The provisions of this Master Resolution shall constitute a contract between the Issuer
and the registered owners from time to time of the Bond. After the issuance of the Bond, no change,
variation or alteration in the provisions of this Master Resolution may be made, except as provided
in Article VI hereof. The provisions of such contract shall be enforceable by appropriate proceedings
to be taken by any of such registered owners either at law or in equity, to the extent permitted by law.
Section 5.15. Compliance with Resolution. The Issuer will not issue, or permit to be issued,
any bonds or other obligations in any manner other than in accordance with the provisions of this
Master Resolution and will not suffer or permit any default to occur under this Master Resolution,
but will faithfully observe and perform all of the covenants, conditions and requirements hereof. The
Issuer will make, execute and deliver any and all such further resolutions, instruments and assurances
as may be reasonably necessary or proper to carry out the intention or to facilitate the performance
of this Master Resolution and for the better assuring and confirming to the registered owners of the
Bond of the rights, benefits and security provided in this Master Resolution. The Issuer for itself,
its successors and assigns represents, covenants and agrees with the registered owners of the Bonds,
as a material inducement to the purchase of the Bonds, that so long as the Bonds shall remain
outstanding and the principal thereof, prepayment premium, if any, or interest thereon shall be
unpaid or unprovided for, it will faithfully perform all of the covenants and agreements contained
in this Master Resolution and the Bonds.
Section 5.16. Power to Issue Bond and Pledge Revenues and Funds; Power to Own the
System and Collect Rates and Fees; Ownership of Project. The Issuer is duly authorized under all
applicable laws to create and issue the Bonds and to adopt this Master Resolution and to pledge the
Revenues purported to be pledged by Resolution in the manner and to the extent provided herein.
The Bonds and the provisions of this Master Resolution are and will be the valid and legally
enforceable obligations of the Issuer in accordance with the terms of the Bonds and the terms of this
Master Resolution. The Issuer shall at all times, to the extent permitted by law, defend, preserve and
protect the pledge of the Revenues under this Master Resolution and all the rights of the registered
owners of the Bonds under this Master Resolution against all claims and demands of all persons
whomsoever. The Issuer has, and will have so long as the Bonds are outstanding, good, right and
lawful power to acquire, construct, improve, extend and own the Project and the System and to fix
and collect rates, fees and charges, as appropriate, in connection with the System. The Issuer will,
so long as the Bonds are Outstanding, own and operate the Project.
Section 5.17. The Issuer agrees, in accepting the proceeds of the Series 2016 Bond, to
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comply with all applicable state and federal regulations related to the Utah State Revolving Fund
administered by the Water Quality Board. These requirements include, but are not limited to, Title
VI of the Clean Water Act of 1987, the Single Audit Act of 1996, the Utah Wastewater Loan
Program policies and guidelines, the Utah Local Government Bonding Act, the Utah Money
Management Act, the Utah Procurement Code and the State of Utah Legal Compliance Audit Guide.
ARTICLE VI
MODIFICATION OR AMENDMENT OF MASTER RESOLUTION
Section 6.01. Amendments Permitted. The registered owners of seventy-five percent (75%)
in principal amount of the outstanding Bonds (not including any Bonds which may then be held or
owned by or for the account of the Issuer), shall have the right from time to time to approve the
adoption by the Governing Body of any amendment to this Master Resolution which may be deemed
necessary or desirable by the Governing Body; provided, however, that nothing herein contained
shall permit or be construed to permit the modification of the terms and conditions in this Master
Resolution or in the Bond so as to:
(1) Make any change in the maturity of the Bonds;
(2) Reduce the rate of interest borne by the Bonds;
(3) Reduce the amount of the principal payable on the Bonds;
(4) Modify the terms of payment of principal of, prepayment premium, if any, or interest
on the Bond or impose any conditions with respect to such payment;
(5) Affect the rights of the registered owners of less than all of the Bonds then
Outstanding; and
(6) Make any change in the provisions of this Article.
Section 6.02. Notice of Proposed Amendment; Consent of Bondholders.
(a) If at any time the Governing Body shall have proposed an amendatory resolution,
it shall cause the notice of the proposed adoption of such resolution to be sent by registered mail to
the registered owners of the Bonds then Outstanding. No notice by publication shall be required.
(b) Whenever at any time within one year from the date of the mailing of said notice,
there is filed in the office of the City Recorder an instrument or instruments executed by the
registered owners of at least seventy-five percent (75%) in principal amount of the Bonds then
Outstanding, specifically consenting to and approving the adoption of the amendatory resolution;
thereupon, but not otherwise, said resolution shall become effective and the provisions thereof
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binding upon the registered owners of all of the Bonds then outstanding and no registered owners
of any Bond then outstanding, whether or not he shall have consented to or shall have revoked any
consent as in this Article provided, subject to the limitations of the subsequent paragraph, shall have
any right to object to the adoption of such amendatory resolution or to the operation of any of the
terms and provisions thereof.
(c) Any consent given by the registered owners of a Bond pursuant to the provisions
of this Article shall be irrevocable for a period of six months from the date of the mailing of the
notice aforesaid and shall be conclusive and binding upon all future registered owners of the same
Bond during such period. Such consent may be revoked at any time after six months from the date
of mailing of such notice by the registered owners who gave such consent, or by a successor in title,
by fling notice with the Governing Body in form satisfactory to the Governing Body of such
revocation of consent, but such revocation shall not be effective if the registered owners of seventy-
five percent (75%) in principal amount of the Bonds then Outstanding have prior to the attempted
revocation consented to and approved the amendatory resolution.
(d) Proof of the execution of any such instrument of consent or the ownership by any
person of such Bond shall be conclusive, if made in the manner provided in this Article. The fact
and date of the execution by any person of any such instrument of consent may be proved by the
affidavit of a witness of such execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgment of deeds, certifying that the person signing such
instrument of consent acknowledged to him/her the execution thereof.
(e) The amount and number of Bonds owned by any person executing any such
instrument of consent and the date of his holding the same may be proved by a certificate executed
by any bank, trust company or member of the New York Stock Exchange, showing that on the date
therein mentioned such person had on deposit with or exhibited under the claim of ownership to such
bank, trust company or member of the New York Stock Exchange the Bonds therein described. The
Governing Body may nevertheless in its discretion require further proof in cases where it deems
further proof desirable.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Discharge of Indebtedness. Any Bond or Parity Bond shall not be deemed
Outstanding when:
(1) It is cancelled because of payment or prepayment prior to maturity; or
(2) Cash funds for the payment or prepayment of such Bond or Parity Bond shall have been
theretofore deposited with the Depository for such Bond or Parity Bond, respectively (whether upon
or prior to maturity of or the prepayment date established for such Bond or Parity Bond); provided
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that if the Bond or Parity Bond is to be prepaid prior to maturity, notice of such prepayment shall
have been given or waiver of such notice shall have been filed with the Issuer by the registered
owner of the Bond or Parity Bond, respectively, to be prepaid and there shall have been deposited
irrevocably and arrangements shall have been made with the Depository to assure payment of all fees
and expenses of the Depository to become due on and prior to the maturity or prepayment date, with
no monies to be invested in any investments but direct obligations of or obligations guaranteed by
the United States of America, maturing and bearing interest in such amounts and at such times as
will assure sufficient cash to pay currently maturing interest and to pay principal when due.
Section 7.02. Publication of Notice of Bonds to Be Issued. In accordance with the
provisions of Section 11-14-21, Utah Code Annotated, 1953, as amended, the Secretary has
heretofore caused "Notice of Bonds to be Issued" to be published one (1) time in the Moab Times -
Independent , a newspaper having general circulation in Moab, Utah, which is hereby confirmed and
ratified.
Section 7.03. Execution of Escrow Agreement. The Escrow Agreement, in substantially the
form presented at the meeting at which this Master Resolution is adopted, is hereby approved and
the Executive Officer and the City Recorder are hereby authorized and directed to execute and
deliver the Escrow Agreement to the parties thereto, with such changes, if any, as the Executive
Officer may direct prior to such execution and delivery. Said execution of the Escrow Agreement
shall constitute conclusive evidence of the approval thereof by the Executive Officer.
Section 7.04. Depository. The Depository hereunder shall be a Qualified Depository. If at
any time the Depository hereunder shall cease to be a Qualified Depository, the Issuer shall, as soon
as reasonably practicable, select a successor thereto who shall be a Qualified Depository.
Section 7.05. Master Resolution Not to be Construed to Make the Bond an Indebtedness of
the Issuer. Nothing in this Master Resolution shall be construed in such a manner as to result in
making the Bonds an indebtedness of the Issuer, and if it shall ever be held by any court of
competent jurisdiction that any or all of the provisions of this Master Resolution are invalid or that
the enforcement of the provisions of this Master Resolution would make the Bond invalid or
unenforceable, said provisions of this Master Resolution shall be considered to be null and void.
Section 7.06. Partial Invalidity. If any one or more articles, sections, paragraphs, clauses or
provisions of this Master Resolution or the application thereof to any person or circumstances are
held to be invalid by final decision in any court of competent jurisdiction, such invalidity shall not
affect the other articles, sections, paragraphs, clauses and provisions of this Master Resolution which
can be given effect without the article, section, paragraph, clause or provision so held to be invalid
or the application of which is held to be invalid and shall not affect the application of such article,
section, paragraph, clause or provision to other persons or circumstances and to this end the
provisions of this Master Resolution are declared to be severable.
Section 7.07. Article and Section Headings. All references herein to "Articles", "Sections"
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and subdivisions are to the corresponding articles, sections or words of similar import refer to this
Master Resolution as a whole and not to any particular Article, Section or subdivision hereof. The
headings or titles of the several Articles and Sections hereof, and any table of contents appended to
copies hereof, shall be solely for convenience or reference and shall not affect the meaning,
construction or effect of this Master Resolution.
Section 7.08. Conflicting Resolutions. All resolutions and parts thereof in conflict herewith
and hereby repealed to the extent of such conflict.
Section 7.09. Effective Date. Immediately after its adoption, this Master Resolution shall
be signed by the Mayor and the City Recorder shall have the official seal of the Issuer impressed or
imprinted hereon, shall be recorded in a book kept for that purpose and shall take immediate effect.
PASSED AND APPROVED this day of , 2016
ATTEST AND COUNTERSIGN:
By
City Recorder
[SEAL]
CITY OF MOAB
By
Mayor
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