HomeMy Public PortalAboutORD14411 Gilmore&Bell,P.C.
600472.023/City of Jefferson Ordinance v3
SUBSTITUTE BILL 2008-64
Sponsored by Councilman Koon
ORDINANCE NO. 14411
OF THE
CITY OF JEFFERSON,MISSOURI
PASSED OCTOBER 6, 2008
AUTHORIZING:
SEWERAGE SYSTEM REVENUE BONDS
(STATE REVOLVING FUND PROGRAM)
SERIES 2008
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•
INDEX
PAGE
Title.............................................................................................................................. 1
Recitals......................................................................................................................... 1
ARTICLE I
DEFINITIONS
Section 101. Definitions of Words and Terms...................................................................................3
ARTICLE II
AUTHORIZATION OF BONDS
Section 201. Authorization of Bonds................................................................................................6
Section202. Security for Bonds........................................................................................................6
• Section 203. Description of Bonds....................................................................................................6
Section 204. Designation of Paying Agent........................................................................................7
Section 205. Method and Place of Payment of Bonds......................................................................7
Section 206. Registration,Transfer and Exchange of Bonds............................................................7
Section 207. Execution,Authentication and Delivery of Bonds.......................................................8
Section 208. Mutilated,Destroyed, Lost and Stolen Bonds..............................................................8
Section 209. Cancellation and Destruction of Bonds Upon Payment...............................................8
Section 210. Sale and Terms of the Bonds; Authorization and Execution of
Documents....................................................................................................................8
Section 211. Administrative Fee and Other Fees; Revolving Fund Loan.........................................9
ARTICLE III
REDEMPTION OF BONDS
Section 301. Mandatory Sinking Fund Redemption.........................................................................9
Section 302. Optional Redemption...................................................................................................9
Section 303. Identification of Redeemed Bonds...............................................................................9
Section 304. Notice of Redemption................................................................................................ 10
ARTICLE IV
RATIFICATION OF FUNDS AND ACCOUNTS
Section 401. Ratification of Funds and Accounts........................................................................... 10
• Section 402. Administration of Funds and Accounts...................................................................... 10
Section 403. Acknowledgment of Accounts................................................................................... 10
(i)
ARTICLE V
APPLICATION OF BOND PROCEEDS
Section 501. Disposition of Bond Proceeds.................................................................................... 11
Section 502. Assignment and Application of Moneys in the Construction
Account...................................................................................................................... 11
ARTICLE VI
APPLICATION OF REVENUES
Section601. Revenue Fund............................................................................................................. 11
Section 602. Application of Moneys in Funds and Accounts......................................................... 11
Section 603. Deficiency of Payments into Funds and Accounts..................................................... 14
Section 604. Transfer of Funds to Paying Agent............................................................................. 14
ARTICLE VII
DEPOSIT AND INVESTMENT OF MONEYS
Section 701. Investment of Moneys................................................................................................ 14
ARTICLE VIII
• PARTICULAR COVENANTS OF THE CITY
Section 801. Efficient and Economical Operation.......................................................................... 15
Section802. Rate Covenant............................................................................................................ 15
Section 803. Reasonable Charges for all Services.......................................................................... 15
Section804. Annual Budget............................................................................................................ 15
Section805. Annual Audit.............................................................................................................. 15
Section 806. Performance of Duties................................................................................................ 16
Section807. Tax Covenants............................................................................................................ 16
ARTICLE IX
ADDITIONAL BONDS
Section901. Prior Lien Bonds........................................................................................................ 16
Section 902. Parity Lien Bonds or Obligations............................................................................... 17
Section903. Junior Lien Bonds...................................................................................................... 17
Section904. Refunding Bonds........................................................................................................ 18
ARTICLE X
DEFAULT AND REMEDIES
Section 1001. Event of Default......................................................................................................... 18
• Section 1002. Remedies.................................................................................................................... 18
Section 1003. Limitation on Rights of Owners................................................................................. 18
(ii)
Section 1004. Remedies Cumulative................................................................................................. 18
Section 1005. No Obligation to Levy Taxes ..................................................................................... 19
ARTICLE XI
DEFEASANCE
Section1101. Defeasance................................................................................................................. 19
ARTICLE XII
AMENDMENTS
Section1201. Amendments............................................................................................................... 19
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 1301. Further Authority........................................................................................................20
Section1302. Severability.................................................................................................................20
Section1303. Governing Law...........................................................................................................20
Section1304. Effective Date.............................................................................................................20
Passage.......................................................................................................................20
Approval.....................................................................................................................20
• Exhibit A—Terms of Bonds
Exhibit B—Form of Bond
Exhibit C—Certificate of Final Terms
Exhibit D—Form of Closing Certificate
•
(iii)
BILL NO. 2008-64(SUBSTITUTE) ORDINANCE NO. 14411
I
AN ORDINANCE AUTHORIZING THE ISSUANCE OF SEWERAGE SYSTEM
REVENUE BONDS (STATE REVOLVING FUND PROGRAM) SERIES 2008 OF THE
CITY OF JEFFERSON, MISSOURI, FOR THE PURPOSE OF EXTENDING AND
IMPROVING THE CITY'S SEWERAGE SYSTEM; PRESCRIBING THE FORM AND
DETAILS OF THE BONDS AND THE AGREEMENTS MADE BY THE CITY TO
FACILITATE AND PROTECT THEIR PAYMENT; AND AUTHORIZING A NO—
INTEREST LOAN FROM THE WATER AND WASTEWATER LOAN FUND AND/OR
THE WATER AND WASTEWATER LOAN REVOLVING FUND OF THE STATE OF
MISSOURI AND PRESCRIBING OTHER RELATED MATTERS.
WHEREAS, the City of Jefferson, Missouri (the"City") is a constitutional charter city, organized
and existing under the constitution and laws of the State of Missouri; and
WHEREAS, the City now owns and operates a revenue producing sewerage system serving the
City, its inhabitants and others within its service area, including connected and related appurtenances and
facilities and extensions, improvements, additions and enlargements made or acquired by the City after
the date of this Ordinance(the"System"); and
WHEREAS, the City desires to make extensions and improvements to the System to be financed
in whole or in part by the issuance, pursuant to this Ordinance, of its Sewerage System Revenue Bonds
(State Revolving Fund Program) Series 2008 (the"Bonds"); and
WHEREAS, to provide the most cost effective financing of the extensions and improvements to
the System, the City desires to participate in the Missouri Leveraged State Water Pollution Control
Revolving Fund Program (the "SRF Program") of the Missouri Department of Natural Resources
("DNR") and the State Environmental Improvement and Energy Resources Authority (the "Authority");
and
WHEREAS, under the provisions of Chapter 250 of the Revised Statutes of Missouri (the "Act")
the City is authorized to issue and sell revenue bonds for the purpose of paying all or part of the cost of
extending and improving the System, with the cost of operation and maintenance of the System and the
principal of and interest on revenue bonds payable solely from the Net Revenues(as defined below); and
WHEREAS,pursuant to the Act, a special bond election was duly held in the City on November 7,
2000 on the following question:
QUESTION
Shall the City of Jefferson, Missouri, issue its sewerage system revenue bonds in
the amount of$52,000,000 for the purpose of improving and extending the City's sewerage
system,the cost of operation and maintenance of said sewerage system and the principal of
and interest on said revenue bonds to be payable solely from the revenues derived by the
City from the operation of its sewerage system, including all future improvements and
extensions thereto?
• and it was found and determined that more than a simple majority of the qualified electors of the City voting
on the question had voted in favor of the question, the vote having been 14,406 votes for the question and
2,687 votes against the question;and
WHEREAS, the City Council (the "Governing Body") of the City has caused plans and
specifications for extensions and improvements to the System and a cost estimate to be made by the
Consulting Engineer(as defined below); and
WHEREAS, the plans and specifications and the cost estimate are accepted and approved and are
i on file in the office of the City Clerk, the amount of the estimated cost being not o less than the maximum
Original Principal Amount set forth in Exhibit A; and
WHEREAS, $40,350,250 principal amount of the bonds so authorized has been issued(as further
described below) and the City finds and determines that it is necessary and advisable and in the best
interest of the City and of its inhabitants to issue the Bonds in the Original Principal Amount; and
WHEREAS, by Ordinance No. 13295 adopted on October 31, 2001 (the "Series 2001B Bond
Ordinance"),the City has issued its Sewerage System Refunding and Improvement Revenue Bonds(State
Revolving Fund Program) Series 2001B (the "Series 2001B Bonds"), dated November 1, 2001, in the
original principal amount of$24,875,000, of which $19,730,000 remains outstanding as of the date of
adoption of this Ordinance; and
WHEREAS, by Ordinance No. 13878 adopted on May 4, 2005 (the "Series 2005A Bond
Ordinance"), the City has issued its Sewerage System Revenue Bonds (State Revolving Fund Program)
• Series 2005A (the "Series 2005A Bonds"), dated May 19, 2005, in the original principal amount of
$4,600,000, of which$4,140,000 remains outstanding as of the date of adoption of this Ordinance; and
WHEREAS, by Ordinance No. 13961 adopted on October 17, 2005 (the "Series 2005B Bond
Ordinance", the Series 200113 Bond Ordinance, the Series 2005A Bond Ordinance and the Series 2005B
Bond Ordinance collectively referred to herein as the"Outstanding Parity Bond Ordinance"), the City has
issued its Sewerage System Refunding and Improvement Revenue Bonds (State Revolving Fund
Program) Series 2005B (the"Series 2005B Bonds",the Series 2001B Bonds,the Series 2005A Bonds and
the Series 2005B Bonds collectively referred to herein as the"Outstanding Party Bonds"), in the original
principal amount of$10,900,000, of which $9,425,000 remains outstanding as of the date of adoption of
this Ordinance;
WHEREAS, the City, upon the issuance of the Bonds, will not have outstanding any other bonds
or other obligations payable from the Net Revenues other than the Outstanding Parity Bonds and the
Bonds; and
WHEREAS, under the provisions of the Outstanding Parity Bond Ordinance, the City may issue
additional bonds payable out of the Net Revenues that are on a parity with the Outstanding Parity Bonds,
only if certain conditions are met; and
WHEREAS, it is hereby found and determined that it is necessary and advisable and in the best
interest of the City and its inhabitants that revenue bonds be issued and secured in the form and manner
provided in this Ordinance and be sold to the Authority under the SRF Program, subject to the conditions
of the Outstanding Parity Bond Ordinance;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
JEFFERSON,MISSOURI,AS FOLLOWS:
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• ARTICLE I
DEFINITIONS
Section 101. Definitions of Words and Terms. Capitalized words and terms defined in the
Recitals and elsewhere in this Ordinance have the meanings set forth therein. Capitalized words and
terms not otherwise defined in this Ordinance have the meanings set forth in the Purchase Agreement (as
defined below). In addition,capitalized words and terms have the following meanings in this Ordinance:
"Administrative Fee"means the fee payable to DNR equal to 0.714%of the outstanding principal
amount of the Revolving Fund Loan on each Administrative Fee Calculation Date.
"Administrative Fee Calculation Date" means the Business Day preceding each January 1,
commencing on the first January 1 on which the principal of the Bonds is payable.
"Authority Bonds" means the series of Water Pollution Control and Drinking Water Revenue
Bonds(State Revolving Funds Programs)of the Authority as designated in the Closing Certificate.
"Authority Program Bonds" means the Authority Bonds and any other bonds of the Authority
issued under the SRF Program, all or a portion of the proceeds of which are loaned to the City pursuant to
the SRF Program.
"Authorized Representative" means the representative of the City designated by the City in
• accordance with the Regulations.
"Bond Register" means the books for the registration, transfer and exchange of Bonds kept at the
office of the Paying Agent.
"Capitalized Interest Subaccount"means the subaccount in the Construction Account established
by the Trustee and acknowledged by Section 403.
"Certificate of Final Terms" means Exhibit C, executed and delivered by the Mayor pursuant to
Section 210 and attached to this Ordinance as of the date of issuance of the Bonds.
"Closing Certificate" means the City's closing certificate executed and delivered by the Mayor on
the date of issuance of the Bonds, in substantially the form attached as Exhibit D.
"Consultant"means the Consulting Engineer, an independent certified public accountant or a firm
of independent certified public accountants.
"Consulting Engineer" means each independent engineer or engineering firm with experience in
designing and constructing wastewater treatment, sanitary sewerage or water pollution control facilities
and retained by the City.
"Current Expenses" means all reasonable and necessary expenses of ownership, operation,
maintenance and repair of the System and keeping the System in good repair and working order,
determined in accordance with generally accepted accounting principles, including current maintenance
• charges, expenses of reasonable upkeep and repairs, salaries, wages, costs of materials and supplies,
Paying Agent fees and expenses, annual audits, periodic Consultant's reports, properly allocated share of
charges for insurance, the cost of purchased water, gas and power, obligations (other than for borrowed
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• money or for rents payable under capital leases) incurred in the ordinary course of business, liabilities
incurred by endorsement for collection or deposit of checks or drafts received in the ordinary course of
business, short—term obligations incurred and payable within a particular Fiscal Year, obligations incurred
for the purpose of leasing (pursuant to a true or operating lease) equipment, fixtures, inventory or other
personal property, and all other expenses incident to the ownership and operation of the System, but
excluding interest paid on System Revenue Bonds, depreciation, amortization and other noncash charges
(including payments into the Depreciation and Replacement Account), and all general administrative
expenses of the City not related to the operation of the System.
"Defeasance Securities"means:
(a) Federal Securities;
(b) obligations of the Resolution Funding Corporation or any successor, but only if
the use of the obligations to pay and discharge Bonds pursuant to Article XI will cause the
discharged Bonds to be rated in the highest long—term rating category by the Rating Agency; or
(c) obligations of any state of the United States of America or of any agency,
instrumentality or local governmental unit of any state that:
(i) are not callable at the option of the obligor prior to maturity or for which
irrevocable instructions have been given by the obligor to call on the date specified in the
instructions, and
(ii) are fully secured as to principal, redemption premium and interest by a
• fund, consisting of cash or Federal Securities,that:
(A) may be applied only to the payment of principal, redemption
premium and interest on the obligations, and
(B) is sufficient, as verified by a nationally recognized independent
certified public accountant,to pay the principal, redemption premium and interest
on the obligations.
"Depreciation and Replacement Account" means the fund or account created or ratified and
confirmed by Section 401.
"Federal Securities" means any direct obligation of, or obligation the timely payment of the
principal of and interest on which is unconditionally guaranteed by, the United States of America and
backed by its full faith and credit.
"Interest Payment Date"means each January 1 and July 1, commencing July 1, 2009.
"Net Revenues"means Revenues less Current Expenses.
"Operation and Maintenance Account" means the fund or account created or ratified and
confirmed by Section 401.
• "Ordinance"means this Ordinance as from time to time amended in accordance with its terms.
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• "Original Principal Amount" means the principal amount of Bonds originally issued and
delivered pursuant to this Ordinance, in the amount specified in the Certificate of Final Terms, subject to
Exhibit A.
"Outstanding" means, as of the date of determination, all Bonds issued and delivered under this
Ordinance, except:
(1) Bonds cancelled by the Paying Agent or delivered to the Paying Agent for
cancellation;
(2) Bonds for the payment of the principal or redemption price of and interest on
which money or Defeasance Securities are held under Section 1101;
(3) Bonds in exchange for which, or in lieu of which, other Bonds have been
registered and delivered pursuant to this Ordinance; and
(4) Bonds allegedly mutilated, destroyed,lost, or stolen and paid under Section 208.
"Owner"means the Authority and its assigns.
"Parity Bonds" means the Outstanding Parity Bonds and any parity bonds issued under Section
902 and Section 904 payable from the Net Revenues on a parity basis with the Bonds.
"Parity Ordinances" means the Outstanding Parity Bond Ordinance and the ordinances under
• which any other Parity Bonds are issued.
"Purchase Agreement" means the Purchase Agreement dated as of October 1, 2008, by and
among the City,the Authority and DNR.
"Record Date" means the 15th day (whether or not a Business Day) of the calendar month next
preceding the applicable Interest Payment Date.
"Revenue Fund"means the fund or account created or ratified and confirmed by Section 401.
"Revenues" means all income and revenues derived by the City from the System, determined in
accordance with generally accepted accounting principles, including investment and rental income, net
proceeds from business interruption insurance, sales tax revenues which have been annually appropriated
by the City or which are limited solely to the payment of improvements to or expenses of the System and
any amounts deposited in escrow in connection with the acquisition, construction, remodeling, renovation
and equipping of facilities to be applied during the period of determination to pay interest on System
Revenue Bonds, but excluding any profits or losses on developer-financed System assets contributed to the
City, the early extinguishment of debt or the sale or other disposition of investments or fixed or capital
assets not in the ordinary course of business.
"Revolving Fund Agreement"means the Revolving Fund Agreement dated as of October 1, 2008,
by and among the City,the Authority and DNR.
"Revolving Fund Loan" means the no—interest loan to the City by DNR from The Water and
• Wastewater Loan Fund and/or The Water and Wastewater Loan Revolving Fund under the Revolving
Fund Agreement.
5
"SRF Program Bonds" means the Bonds and any other System Revenue Bonds issued in
connection with the City's participation in the SRF Program.
"SRF Subsidy" means the amount of investment earnings which will accrue on the Reserve
Account during each Fiscal Year (taking into account scheduled transfers from the Reserve Account
which will occur upon the payment of principal on the Authority Program Bonds and assuming that the
construction for the applicable project has been completed), if the Reserve Security is equal to the Reserve
Percentage of the principal amount of the SRF Program Bonds outstanding, the Reserve Account is
invested in an investment agreement at a fixed interest rate during the calculation period and earnings are
reduced by the Administrative Fee payable to DNR. Administrative Fee, Reserve Account, Reserve
Percentage and Reserve Security as used in this definition have the respective meanings set forth in the
bond indentures for the applicable Authority Program Bonds.
"State"means the State of Missouri.
"Surplus Account"means the fund or account created or ratified and confirmed by Section 401.
"System Revenue Bonds" means collectively the Bonds, the Parity Bonds and all other revenue
bonds which are payable from the Net Revenues.
"Term Bond" means each Bond, if any, designated as a Term Bond in the Certificate of Final
Terms.
"Trustee"means the trustee acting at any time as Trustee under the Indenture.
• "User Charge Ordinance" means Ordinance No. 13155 of the City passed on January 2, 2001, as
amended, supplemented or replaced and approved by DNR.
ARTICLE lI
AUTHORIZATION OF BONDS
Section 201. Authorization of Bonds. The Bonds are authorized and directed to be issued in
the Original Principal Amount for the purposes of this Ordinance.
Section 202. Security for Bonds.
(a) The Bonds are special, limited obligations of the City payable solely from, and secured
by a pledge of, the Net Revenues. The taxing power of the City is not pledged to the payment of the
Bonds. The Bonds do not constitute a general obligation of the City or an indebtedness of the City within
the meaning of any constitutional, statutory or charter provision, limitation or restriction.
(b) The Bonds are issued on parity with the Outstanding Parity Bonds.
Section 203. Description of Bonds. The Bonds consist of fully registered bonds without
coupons, numbered from R-1 consecutively upward, in the denomination of $5,000 or any integral
multiple of $5,000. The Bonds will be issued in substantially the form of Exhibit B and will be
registered, transferred and exchanged as provided in Section 206. The Bonds are dated the Dated Date as
• set forth on the Bonds. The Bonds will become due on the dates and in the principal amounts and will
bear interest at the rates as set forth in the Certificate of Final Terms. Interest is computed on the basis of
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• a 360-day year of twelve 30—day months from the Dated Date or from the most recent Interest Payment
Date to which interest has been paid or provided for and is payable on each Interest Payment Date.
Section 204. Designation of Paying Agent. The Trustee is designated as the City's paying
agent for the payment of the Bonds and bond registrar for the registration,transfer and exchange of Bonds
(the "Paying Agent"). The Paying Agent will not be paid any additional fees for its services under this
Ordinance.
Section 205. Method and Place of Payment of Bonds.
(a) Payment of the Bonds will be made with any coin or currency that is legal tender for the
payment of debts due the United States of America on the payment date.
(b) Each payment of principal of and redemption premium, if any,payable on each Bond will
be made at maturity or upon earlier redemption to the Owner shown in the Bond Register at the maturity
or optional redemption date of each Bond, upon presentation and surrender of the Bond at the principal
office of the Paying Agent. The payment of interest payable on each Bond on any Interest Payment Date
will be made by check or draft mailed by the Paying Agent to the address of the Owner shown in the
Bond Register. The principal of and redemption premium, if any, and interest on the Bonds is payable by
electronic transfer in immediately available federal funds to a bank in the continental United States of
America pursuant to instructions from any Owner received by the Paying Agent prior to the Record Date.
(c) The Paying Agent will keep a record of payment of principal of, redemption premium, if
any, and interest on all Bonds and, at least annually at the request of the City, will forward a copy or
• summary of the record of payments to the City.
Section 206. Registration,Transfer and Exchange of Bonds.
(a) The City will cause the Paying Agent to keep the Bond Register. Each Bond when issued
will be registered in the name of the Owner on the Bond Register. Bonds will be transferred and
exchanged only upon the Bond Register.
(b) Upon surrender of any Bond at the principal office of the Paying Agent,the Paying Agent
will transfer or exchange the Bond for a new Bond or Bonds in any authorized denomination of the same
maturity and in the same aggregate principal amount as the Bond which was presented for transfer or
exchange. All Bonds presented for transfer or exchange must be accompanied by a written instrument of
transfer or authorization for exchange, in a form and with guarantee of signature satisfactory to the Paying
Agent, duly executed by the Owner or by the Owner's authorized agent. All Bonds presented for transfer
or exchange must be surrendered to the Paying Agent for cancellation.
(c) For every exchange or transfer of Bonds the City or the Paying Agent may levy a charge
sufficient to reimburse it for any tax, fee or other governmental charge required to be paid for the
exchange or transfer. The person requesting the exchange or transfer must pay the charge. Payment of
the charge is a condition precedent to the exchange or transfer.
(d) The City and the Paying Agent will treat the person in whose name any Bond is
registered as the absolute owner of the Bond, whether or not payment of the Bond is overdue, for the
purpose of receiving payment of the principal of, redemption premium, if any, and interest on the Bond
• and for all other purposes. All payments made to any Owner or upon the Owner's order will be valid and
effectual to satisfy and discharge the City's liability for payment of the Bond to the extent of the sum or
sums paid. Neither the City nor the Paying Agent will be affected by any notice to the contrary.
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• (e) At reasonable times and under reasonable rules established by the Paying Agent, the
Owners of 25%or more in principal amount of the Outstanding Bonds, or their representative designated
in a manner satisfactory to the Paying Agent,may inspect and copy the Bond Register.
Section 207. Execution,Authentication and Delivery of Bonds.
(a) Each Bond must be signed by the manual or facsimile signature of the Mayor and attested
by the manual or facsimile signature of the City Clerk, and have the official seal of the City affixed or
imprinted thereon. If any officer whose manual or facsimile signature appears on any Bond ceases to be
an officer before the delivery of any Bond signed by the officer, the manual or facsimile signature on the
Bond will be valid and sufficient for all purposes of this Ordinance.
(b) The Mayor and the City Clerk are directed to prepare and execute the Bonds as specified
in this Article, and when executed, to deliver the Bonds to the Paying Agent for authentication. Upon
authentication,the Paying Agent will deliver the Bonds to the Owner, upon payment of the purchase price
for the Bonds.
(c) Each Bond will be authenticated by any authorized officer or employee of the Paying
Agent. No Bond is entitled to any security or benefit under this Ordinance or is valid or obligatory for
any purpose until authenticated by the Paying Agent.
Section 208. Mutilated,Destroyed, Lost and Stolen Bonds.
(a) If(i) any mutilated Bond is surrendered to the Paying Agent, or the City and the Paying
Agent receive evidence to their satisfaction of the mutilation, destruction, loss or theft of any Bond, and
(ii) there is delivered to the City and the Paying Agent security or indemnity as required by them, in the
absence of notice to the City or the Paying Agent that the Bond has been acquired by a bona fide
purchaser, the City will execute and the Paying Agent will register and deliver, in exchange for or in lieu
of any mutilated, destroyed, lost or stolen Bond, a new Bond of the same maturity and of like tenor and
principal amount. If the Bond has become or is about to become due, the City may pay the Bond instead
of issuing a new Bond.
(b) Upon the issuance of any new Bond under this Section, the City may require the payment
by the Owner of a sum sufficient to cover any tax or other governmental charge imposed and any other
expenses(including the fees and expenses of the Paying Agent)connected with the issuance of the Bond.
(c) Every new Bond issued pursuant to this Section in lieu of any mutilated, destroyed, lost
or stolen Bond will constitute a replacement of the prior obligation of the City, whether or not the
mutilated, destroyed, lost or stolen Bond is enforceable by anyone at any time, and will be entitled to all
the benefits of this Ordinance equally and ratably with all other Outstanding Bonds.
Section 209. Cancellation and Destruction of Bonds Upon Payment. All Bonds which have
been paid or redeemed or which have otherwise been surrendered to the Paying Agent, either at or before
maturity, will be cancelled immediately upon the payment or redemption and the Paying Agent's receipt
of the Bonds. The Paying Agent will periodically destroy cancelled Bonds. The Paying Agent will
execute a certificate in duplicate describing the destroyed Bonds and file an executed counterpart of the
certificate with the City.
• Section 210. Sale and Terms of the Bonds; Authorization and Execution of Documents. The
Bonds will be sold to the Owner under the terms of the Purchase Agreement. The City is authorized to
8
• enter into the Purchase Agreement and the Revolving Fund Agreement, in substantially the forms
presented to the Governing Body. The Mayor is authorized to execute the Purchase Agreement and the
Revolving Fund Agreement for and on behalf of and as the act and deed of the City, with changes approved
by the Mayor, which approval will be conclusively evidenced by the Mayor's execution of the Purchase
Agreement and the Revolving Fund Agreement. The Mayor is further authorized and directed to approve
the purchase price for the Bonds, the principal amounts by maturity, the interest rates and the other final
terms of the Bonds, including applicable redemption provisions, subject to the limitations set forth in
Exhibit A, and in that connection, to execute and deliver the Certificate of Final Terms for and on behalf of
and as the act and deed of the City, which approval will be conclusively evidenced by the Mayor's
execution of the Certificate of Final Terms. Upon execution,the Certificate of Final Terms will be attached
to this Ordinance as Exhibit C. The Mayor is further authorized and directed to execute the Closing
Certificate and other documents, certificates and instruments that are necessary or desirable to carry out the
intent of this Ordinance. The City Clerk is authorized and directed to attest the execution of the Purchase
Agreement, the Revolving Fund Agreement,the Closing Certificate, and such other documents, certificates
and instruments that are necessary or desirable to carry out the intent of this Ordinance.
Section 211. Administrative Fee and Other Fees; Revolving Fund Loan.
(a) Subject to Section 202, the City will pay to the Trustee for deposit in the Administrative
Expense Fund, within 30 days after receipt of a statement from the Trustee (i) the Administrative Fee,
(ii)the City's Allocable Portion of the Master Trustee's Disclosure Fee, and (iii) the City's Allocable
Portion of the Trustee's Fee.
(b) The City is authorized to receive the Revolving Fund Loan under the terms of the
• Revolving Fund Agreement. By this Ordinance, the City assigns the proceeds of the Revolving Fund
Loan, as and when received,to the Authority.
ARTICLE III
REDEMPTION OF BONDS
Section 301. Mandatory Sinking Fund Redemption. The Term Bonds set forth in the
Certificate of Final Terms will be redeemed in part on the dates and in the principal amounts set forth in
the Certificate of Final Terms, at a redemption price equal to 100%of the principal amount redeemed plus
accrued interest to the redemption date.
Section 302. Optional Redemption. At the option of the City, certain Bonds may be called for
redemption and payment prior to maturity in whole or in part on the dates and at the redemption prices set
forth in the Certificate of Final Terms. Bonds will be optionally redeemed in part in integral multiples of
$5,000 from the maturities selected by the City with the prior written consent of the Owner. Upon
redemption, the sinking fund redemption amounts for each Term Bond will be proportionately reduced
(unless otherwise directed by the City with the prior written consent of the Owner), subject to rounding to
integral multiples of$5,000. The City will give written notice to the Trustee designating the amount of
each maturity redeemed and the reduction in each sinking fund redemption amount, subject to verification
by the Trustee. In exercising its option to redeem the Bonds, the City will deposit with the Paying Agent,
prior to the redemption date, an additional premium equal to 30—days' interest on the Bonds to be
redeemed.
• Section 303. Identification of Redeemed Bonds. The redemption of the Bonds in part will be
reflected in the records maintained by the Paying Agent.
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• Section 304. Notice of Redemption. The Paying Agent will give notice of optional
redemption, unless waived, by mailing a redemption notice by regular mail at least 45 days prior to the
date fixed for optional redemption, to the Owner of each Bond to be redeemed at the address shown on
the Bond Register. If notice of redemption has been given or waived, the Bonds or portions of Bonds
called for redemption will become due and payable on the redemption date at the redemption price
specified in the notice. No notice of mandatory sinking fund redemption is required to be given.
ARTICLE IV
RATIFICATION OF FUNDS AND ACCOUNTS
Section 401. Ratification of Funds and Accounts. The separate funds and accounts created in,
or ratified and confirmed by,the Outstanding Parity Bond Ordinance known respectively as the:
(1) Sewerage System Revenue Fund(the"Revenue Fund");
(2) Sewerage System Operation and Maintenance Account (the "Operation and Maintenance
Account");
(3) Interest Accounts, Principal Accounts and Debt Service Accounts under the Outstanding
Parity Bond Ordinance(collectively the"Outstanding Parity Bond Debt Service Account");
(4) Reserve Accounts under the Outstanding Parity Bond Ordinance (collectively the
"Outstanding Parity Bond Debt Service Reserve Account");
• (5) Sewerage System Depreciation and Replacement Account (the "Depreciation and
Replacement Account"); and
(6) Sewerage System Surplus Account(the"Surplus Account");
are hereby ratified and confirmed.
Section 402. Administration of Funds and Accounts. The funds and accounts described in
clauses (1), (2), (5) and (6) of Section 401 will be maintained and administered by, or on behalf of, the
City under this Ordinance and the Outstanding Parity Bond Ordinance, while any of the Bonds and the
Outstanding Parity Bonds are outstanding. The funds or accounts described in clauses (3) and (4) of
Section 401 will be maintained and administered by, or on behalf of, the City while the applicable
Outstanding Parity Bonds are outstanding.
Section 403. Acknowledp_ment of Accounts.
(a) The City acknowledges the creation of the following accounts for the City held by the
Trustee under the Indenture:
(1) Construction Account and the Capitalized Interest Subaccount within the
Construction Account;
(2) Reserve Account;
• (3) State Match Portion Debt Service Account;
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• (4) Leveraged Portion Debt Service Account;
(5) Principal Account; and
(6) Interest Account.
(b) The City further acknowledges that certain amounts will be transferred to the Costs of
Issuance Fund and the Administrative Expense Fund under the Indenture in satisfaction of certain City
obligations under this Ordinance,the Purchase Agreement and the Revolving Fund Agreement.
ARTICLE V
APPLICATION OF BOND PROCEEDS
Section 501. Disposition of Bond Proceeds. The proceeds received from the sale of the
Bonds, including any premium and accrued interest, will be deposited simultaneously with the delivery of
the Bonds as set forth in the Closing Certificate.
Section 502. Assignment and Application of Moneys in the Construction Account.
(a) By this Ordinance, the City assigns the proceeds of the Bonds held in the Construction
Account to the Owner to secure the City's obligations under this Ordinance. Moneys in the Construction
Account will be disbursed to the City for the sole purpose of paying the cost of extending and improving
the System in accordance with the plans and specifications prepared by the Consulting Engineer,
• previously approved by the Governing Body and DNR and on file in the office of the City Clerk,
including any alterations in or amendments to the plans and specifications approved by the Governing
Body and DNR with the advice of the Consulting Engineer.
(b) Requisitions will be submitted for withdrawals from the Construction Account in
accordance with Article III of the Purchase Agreement.
ARTICLE VI
APPLICATION OF REVENUES
Section 601. Revenue Fund. The City covenants and agrees that from and after the delivery of
the Bonds, all Revenues derived and collected by the City will be deposited into the Revenue Fund when
received. The Revenues will be segregated from all other moneys, revenues, funds and accounts of the
City. The Revenue Fund will be administered and applied solely for the purposes and in the manner
provided in this Ordinance and any Panty Ordinance.
Section 602. Application of Moneys in Funds and Accounts.
(a) The City will apply moneys in the Revenue Fund on the dates, in the amounts and in the
order as follows:
(1) on the first day of each month to the Operation and Maintenance Account an
amount sufficient to pay the estimated cost of operating and maintaining the System during the
• month;
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• (2) on a parity basis, (i) on the 25th day of each month, to the Outstanding Parity
Bond Debt Service Account the amount required under the Outstanding Parity Bond Ordinance
and (ii) on each March 1, June 1, September 1 and December 1 (the"Quarterly Payment Dates")
the following amounts to the Trustee for credit to the Interest Account and the Principal Account:
(A) to the Interest Account, on March 1, 2009 and each Quarterly Payment
Date thereafter, 1/2 of the amount of interest due on the Bonds on the next Interest
Payment Date,with these quarterly payments to be reduced as follows:
(I) the balance in the State Match Portion Debt Service Account and
the Leveraged Portion Debt Service Account on an Interest Payment Date after
the payment of the principal of and interest due on the Authority Bonds on the
Interest Payment Date will be credited against the next succeeding quarterly
payment or payments; and
(II) the projected investment earnings for the current Interest Period,
as set forth in the Trustee's semiannual notice to the City, will be credited in
equal installments against the quarterly payments due prior to the next Interest
Payment Date; and
(III) pursuant to a Requisition conforming to Section 3.4 of the
Purchase Agreement, the amount to be transferred from the Capitalized Interest
Subaccount to the Interest Account for the estimated interest payable on the
Bonds through a date not later than the Quarterly Payment Date which is not more
than 12 months after the Initiation of Operation of the last operable segment of the
Project(as evidenced under Section 3.5 of the Purchase Agreement); and
(B) to the Principal Account, on March 1, 2009 and each Quarterly Payment
Date thereafter, 1/4 of the principal due on the Bonds on the next succeeding principal
payment date, whether at maturity or upon mandatory sinking fund redemption. If the
Initiation of Operation specified in the certificate delivered by the City under Section 3.5
of the Purchase Agreement is earlier than the expected Initiation of Operation on the
City's signature page to the Purchase Agreement, (i) the first quarterly installment of
principal will be paid no later than the Quarterly Payment Date which is not more than 12
months after the Initiation of Operation, and(ii) on the Quarterly Payment Date which is
not more than 20 years after the Initiation of Operation, all remaining unpaid principal
installments will be paid;
(3) on the dates required by Section 211(a), to the Trustee, for deposit to the
Administrative Expense Fund, the amount required to pay the Administrative Fee, the City's
Allocable Portion of the Trustee's Fee and the City's Allocable Portion of the Master Trustee's
Disclosure Fee;
(4) on the first day of each month, to the Outstanding Parity Bond Debt Service
Reserve Account as required by the Outstanding Parity Bond Ordinance and, if the Trustee has
withdrawn moneys from the Reserve Account (other than investment earnings or the amount
transferred from the Reserve Account upon the payment of principal on the Bonds), to the
Reserve Account all available moneys until the Reserve Account has been replenished;
• (5) on the first day of each month,to the Depreciation and Replacement Account, the
amount required by the User Charge Ordinance (if the Outstanding Parity Bonds are outstanding,
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• any deposits made pursuant to this paragraph are subject to the applicable restrictions in the
Outstanding Parity Bond Ordinance); and
(6) on the first day of each month the remaining balance to the Surplus Account.
(b) If the amount in the Revenue Fund is not sufficient to make the payments at the time
required to be made by the City to the Interest Account, the Principal Account and the Outstanding Parity
Bond Debt Service Account, the City will apply the remaining balance in the Revenue Fund on a
proportionate basis (based upon the outstanding principal amounts of the Bonds and the Outstanding
Parity Bonds) to the Principal Account, the Interest Account and the Outstanding Parity Bond Debt
Service Account.
(c) If the amount in the Revenue Fund is not sufficient to make the payments at the time
required to be made by the City to the Reserve Account and to the Outstanding Parity Bond Debt Service
Reserve Account, the City will divide the balance in the Revenue Fund between the Reserve Account and
the Outstanding Parity Bond Debt Service Reserve Account on a proportionate basis (based upon the
outstanding principal amounts of the Bonds and the Outstanding Parity Bonds).
(d) Except as provided in Section 603,moneys in the Depreciation and Replacement Account
will be used by the City for the purpose of making replacements and repairs to the System in order to
keep the System in good repair and working order and to assure the continued effective and efficient
operation of the System. This provision will not be construed to modify any more restrictive provision of
the Outstanding Panty Bond Ordinance for the use of moneys in the Depreciation and Replacement
Account.
• (e) Moneys in the Surplus Account are to be expended for the following purposes as
determined by the Governing Body:
(1) paying the cost of the operation, maintenance and repair of the System to the
extent necessary after the application of the moneys held in the Operation and Maintenance
Account and in the Depreciation and Replacement Account;
(2) paying the cost of extending, enlarging or improving the System;
(3) preventing default in, anticipating payments into or increasing the amounts in the
accounts confirmed or established in Section 401, the Principal Account,the Interest Account,the
Reserve Account or the Depreciation and Replacement Account, or establishing or increasing the
amount of any debt service account or debt service reserve account created by the City for the
payment of any System Revenue Bonds subsequently issued; or
(4) redeeming and paying prior to maturity, or, at the option of the City, purchasing
in the open market at the best price obtainable not exceeding the call price (if any bonds are
callable), the Bonds, the Outstanding Parity Bonds or any other System Revenue Bonds of the
City hereafter issued under the conditions hereinafter specified and standing on parity with the
Bonds, including principal,redemption premium, if any, and interest.
(f) All amounts paid and credited to the Operation and Maintenance Account will be
expended solely for the purpose of paying the Current Expenses of the System.
• (g) No moneys derived by the City from the System will be diverted to the general
governmental or municipal functions of the City.
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• (h) If the deposits to the Operation and Maintenance Account (the"OM Deposits") required
under this Section are greater than the OM Deposits required in the User Charge Ordinance, the OM
Deposits under the User Charge Ordinance will be deemed a credit toward OM Deposits required under
this Section. If the OM Deposits required under this Section are less than those required in the User
Charge Ordinance, OM Deposits under this Section will be deemed a credit to OM Deposits required
under the User Charge Ordinance.
Section 603. Deficiency of Payments into Funds and Accounts.
(a) If the Revenues are insufficient to make any payment on any date specified in this
Article, the City will make good the amount of the deficiency by making additional payments out of the
first available Revenues for application in the order specified in Section 602.
(b) If the moneys in the Outstanding Parity Bond Debt Service Account, the Outstanding
Parity Bond Debt Service Reserve Account, the Principal Account, the Interest Account or the Reserve
Account are not sufficient to pay the principal of and interest on the Outstanding Parity Bonds and the
Bonds as and when the same become due, the City will apply moneys in the Surplus Account and the
Depreciation and Replacement Account on a proportionate basis (based upon the outstanding principal
amounts of the Bonds and the Outstanding Parity Bonds) to the Principal Account, the Interest Account
and the Outstanding Parity Bond Debt Service Account, to prevent any default in the payment of the
principal of and interest on the Bonds and the Outstanding Parity Bonds.
Section 604. Transfer of Funds to Paving Agent. The City Clerk is authorized and directed to
• make the payments to the Principal Account and the Interest Account as provided in Section 602, and, to
the extent necessary to prevent a default in the payment of the Bonds, from the Reserve Account, the
Surplus Account and the Depreciation and Replacement Account as provided in Sections 602 and 603,
sums sufficient to pay the Bonds when due, and to forward amounts to the Paying Agent in a manner
which ensures the Paying Agent will have sufficient available funds on or before the second Business Day
immediately preceding the dates when payments on the Bonds are due. Upon the payment of all principal
and interest on the Bonds, the Paying Agent will return any excess funds to the City. Except as otherwise
provided in the Indenture, all moneys deposited by the City with the Paying Agent are subject to the
provisions of this Ordinance.
ARTICLE VII
DEPOSIT AND INVESTMENT OF MONEYS
Section 701. Investment of Moneys.
(a) Moneys in the Interest Account, the Principal Account, the Construction Account, the
State Match Portion Debt Service Account, the Leveraged Portion Debt Service Account and the Reserve
Account are assigned by the City to the Authority to secure the City's obligations under this Ordinance
and the City acknowledges that moneys in the Interest Account, the Principal Account, the Construction
Account, the State Match Portion Debt Service Account, the Leveraged Portion Debt Service Account
and the Reserve Account will be invested by the Authority, subject to the Arbitrage Instructions, in
Investment Securities in accordance with Section 4.9 of the Indenture. Moneys in each of the other funds
and accounts created or ratified and confirmed by this Ordinance may be invested by the City in
• obligations as may be permitted by law, but no investment will be made for a period extending longer
than the date when the moneys invested may be needed. All earnings on any investments held in any fund
or account will accrue to the applicable fund or account. In determining the amount held in any fund or
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account under this Ordinance, obligations will be valued at the lower of cost or market value. If the
amount in any fund or account held within the Treasury of the City is greater than the required amount,
the City may transfer the excess to the Revenue Fund.
(b) If the Outstanding Parity Bonds are outstanding, any investments made pursuant to this
Section are subject to the applicable restrictions in the Outstanding Parity Bond Ordinance.
ARTICLE VIII
PARTICULAR COVENANTS OF THE CITY
Section 801. Efficient and Economical Operation. The City will continuously own and will
operate the System in an efficient and economical manner and will keep and maintain the System in good
repair and working order.
Section 802. Rate Covenant. The City will fix, establish, maintain and collect rates and
charges for the use and services furnished by or through the System to produce income and revenues
sufficient to (a)pay the costs of the operation and maintenance of the System; (b)pay the principal of and
interest on the Bonds as and when due; (c) enable the City to have in each Fiscal Year Net Revenues of
not less than 110% of the amount required to be paid by the City in the Fiscal Year on account of both
principal of and interest on all System Revenue Bonds at the time outstanding, provided that interest on
any SRF Program Bonds will be reduced by the SRF Subsidy, if any; and (d) provide reasonable and
adequate reserves for the payment of the Bonds and the interest thereon and for the protection and benefit
of the System as provided in this Ordinance. The City will require the prompt payment of accounts for
• service rendered by or through the System and will promptly take whatever action is legally permissible
to enforce and collect delinquent charges.
Section 803. Reasonable Charges for all Services. None of the facilities or services provided
by the System will be furnished to any user(excepting the City itself) without a reasonable charge being
made therefor. If the income and revenues derived by the City from the System are insufficient to pay the
reasonable expenses of operation and maintenance of the System and the principal of and interest on the
Bonds when due, the City will pay into the Revenue Fund a fair and reasonable payment in accordance
with effective applicable rates and charges for all services or other facilities furnished to the City or any of
its departments by the System.
Section 804. Annual Budget. Prior to the commencement of each Fiscal Year, the City will
cause a budget setting forth the estimated receipts and expenditures of the System for the next succeeding
Fiscal Year to be prepared and filed with the City Clerk. The City Clerk, within 30 days after the end of
the current Fiscal Year, will mail a copy of the budget to DNR and the Trustee. The annual budget will be
prepared in accordance with the laws of the State.
Section 805. Annual Audit.
(a) Promptly after the end of each Fiscal Year, the City will cause an audit of the System for
the preceding Fiscal Year to be made by a certified public accountant or firm of certified public
accountants employed for that purpose and paid from the Revenues. The annual audit will cover in
reasonable detail the operation of the System during the Fiscal Year.
• (b) As soon as possible after the completion of the annual audit, the Governing Body will
review the annual audit, and, if the annual audit reveals any breach of this Ordinance, the City agrees to
promptly cure the breach.
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(c) Within 30 days after the acceptance of the audit by the Governing Body, a copy of the
annual audit will be filed in the office of the City Clerk, and a copy of the audit will be mailed to DNR
and the Trustee. The annual audit will be open to examination and inspection during normal business
hours by any taxpayer, any user of the services of the System, the Owner, or anyone acting for or on
behalf of the taxpayer, user or Owner.
(d) The City acknowledges its undertakings set forth in Section 2.2(u) of the Purchase
Agreement.
Section 806. Performance of Duties. The City will faithfully and punctually perform all duties
and obligations with respect to the operation of the System now or hereafter imposed upon the City by the
Constitution and laws of the State and the provisions of this Ordinance.
Section 807. Tax Covenants.
(a) The City will comply with all applicable provisions of the Code, including Sections 103
and 141 through 150, necessary to maintain the exclusion of interest on the Authority Bonds from gross
income for federal income tax purposes. The City will not use or permit the use of any proceeds of the
Bonds or any other funds of the City, nor take or permit any other action, or fail to take any action, which
would adversely affect the exclusion of interest on the Authority Bonds from gross income for federal
income tax purposes. The City will adopt ordinances or resolutions and take other actions necessary to
comply with the Code and with other applicable future law, in order to ensure that the interest on the
Authority Bonds will remain excluded from federal gross income.
(b) The City(1) will use the proceeds of the Bonds as soon as practicable for the purposes for
which the Bonds are issued, and (2) will not invest or directly or indirectly use or permit the use of any
proceeds of the Bonds or any other funds of the City in any manner, or take or omit to take any action,that
would cause the Authority Bonds to be"arbitrage bonds"within the meaning of Section 148(a)of the Code.
(c) The City will not use any portion of the proceeds of the Bonds, including any investment
income earned on the proceeds, directly or indirectly, (1) in a manner that would cause any Bond to be a
"private activity bond"within the meaning of Section 141(a)of the Code,or(2)to make or finance a loan to
any person.
(d) The City will pay to the Trustee, for deposit to the Interest Account and subsequent
transfer as provided in the Indenture, an amount equal to arbitrage rebate and the costs incurred in
connection with determining arbitrage rebate, at the times required by the Arbitrage Instructions. The
provisions of this paragraph will survive the payment in full or defeasance of the Bonds.
ARTICLE IX
ADDITIONAL BONDS
Section 901. Prior Lien Bonds. The City will not issue any debt obligations payable out of the
Net Revenues which are superior in lien, security or otherwise to the Bonds.
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• Section 902. Parity Lien Bonds or Obligations.
(a) The City will not issue any additional bonds or other long—term obligations payable out
of the Net Revenues of the System which stand on parity or equality with the Bonds unless the following
conditions are met:
(1) the City is not in default in the payment of principal or interest on the Bonds or
any Parity Bonds or in making any deposit into the funds and accounts under this Ordinance or
any Parity Ordinance; and
(2) the City provides to the Owner and the Trustee a certificate showing either of the
following:
(A) the average annual Net Revenues as set forth in the two most recent
annual audits for Fiscal Years preceding the issuance of additional bonds, are at least
110% of the average annual debt service on the System Revenue Bonds, including the
additional bonds proposed to be issued, to be paid out of the Net Revenues in all
succeeding Fiscal Years. Interest to be paid on any SRF Program Bonds may be reduced
by the SRF Subsidy, if any. If the City has made any increase in rates for the use and
services of the System and the increase has not been in effect during all of the two Fiscal
Years for which annual audits are available, the City may add the additional Net
Revenues which would have resulted if the rate increase had been in effect for the entire
period to the audited Net Revenues, as certified by the Consultant; or
• (B) the estimated average annual Net Revenues for the two Fiscal Years
immediately following the Fiscal Year in which the improvements to the System being
financed by the additional bonds are to be in commercial operation, as certified by the
Consultant, is at least 110% of the average annual debt service on the System Revenue
Bonds, including the additional bonds proposed to be issued, to be paid out of the Net
Revenues in succeeding Fiscal Years following the commencement of commercial
operation of the improvements. Interest to be paid on any SRF Program Bonds may be
reduced by the SRF Subsidy, if any. In determining the amount of estimated Net
Revenues for the purpose of this subsection, the Consultant may adjust the estimated net
income and revenues by adding the estimated increase in Net Revenues resulting from
any increase in rates for the use and services of the System approved by the City.
(b) If the conditions set forth in this Section are satisfied, the City (i) may issue additional
revenue bonds or other obligations of the City on parity with the Bonds and that enjoy complete equality
of the lien on the Net Revenues with the Bonds, (ii) may make equal provision for paying the additional
revenue bonds or other obligations from the Revenue Fund, and (iii) may secure the additional revenue
bonds or other obligations by funding reasonable System debt service accounts and debt service reserve
accounts from the Net Revenues.
Section 903. Junior Lien Bonds. Nothing in this Article prohibits or restricts the right of the
City to issue additional revenue obligations, including revenue bonds, for the purpose of extending,
improving, enlarging, repairing or altering the System, that are subordinate to the Bonds if at the time of
the issuance of the additional revenue obligations the City is not in default in the performance of any
covenant or agreement in this Ordinance. If the City is in default in paying either interest on or principal
• of the Bonds, or if the Reserve Account is not fully funded, the City shall not make any payments on the
subordinate revenue obligations until the default is cured. Subject to the limitations in this Section, the
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• City may make provision for paying the principal of and interest on the subordinate revenue bonds or
obligations from moneys in the Revenue Fund.
Section 904. Refunding Bonds. The City may, without complying with the provisions of
Section 902, refund any of the Bonds in a manner that provides debt service savings to the City, and the
refunding bonds so issued will be on a parity with any of the Bonds that are not refunded and any
Outstanding Parity Bonds. If the Bonds are refunded in part and the refunding bonds bear a higher
average rate of interest or become due on a date earlier than that of the Bonds that are refunded, the City
must obtain the prior written consent of the Owner and DNR to the issuance of the refunding bonds.
ARTICLE X
DEFAULT AND REMEDIES
Section 1001. Event of Default. If(i) the City defaults in the payment of the principal of or
interest on any of the Bonds, or (ii) the City or its Governing Body or any of its officers, agents or
employees fails or refuses to comply with any provision of this Ordinance, the Constitution or statutes of
the State,the Purchase Agreement or the Revolving Fund Agreement and default continues for a period of
60 days after written notice specifying the non—payment default has been given to the City by the Trustee,
the Authority, DNR or the Owner of any Bond then Outstanding, at any time thereafter and while the
default continues, the City shall pay to DNR the penalties assessed by DNR in accordance with the
Regulations. The penalties will be assessed as a reduction in the credit provided in Section 602(a)(2)(A).
Section 1002. Remedies.
• (a) The provisions of this Ordinance constitute a contract between the City and the Owners
of the Bonds. The Owner or Owners of not less than 10% in principal amount of the Bonds at the time
Outstanding have the right for the equal benefit and protection of all Owners of Bonds similarly situated:
(1) by any proceeding at law or in equity to enforce the rights of the Owner or
Owners against the City and its officers, agents and employees, and to compel the performance by
the City of its duties and obligations under this Ordinance, the Constitution and the laws of the
State;
(2) by any proceeding at law or in equity to require the City, its officers, agents and
employees to account as if they were the trustees of an express trust; and
(3) by any proceeding at law or in equity to enjoin any act or thing which is unlawful
or in violation of the rights of the Owners of the Bonds.
(b) Any amounts paid on the Bonds to the Owners will be applied first to interest and second
to principal,to the extent due and payable.
Section 1003. Limitation on Rights of Owners. No Owner has any right in any manner
whatever by the Owner's action to affect, disturb or prejudice the security granted and provided for in, or
to enforce any right under, this Ordinance, except in the manner provided in this Ordinance. All
proceedings at law or in equity will be for the equal benefit of all Owners.
• Section 1004. Remedies Cumulative. No remedy conferred upon the Owners is intended to be
exclusive of any other remedy. Each remedy is in addition to every other remedy and may be exercised
without exhausting any other remedy conferred under this Ordinance. No waiver by any Owner of any
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default or breach of duty or contract of the City under this Ordinance will affect any subsequent default or
breach of duty or contract by the City or impair any rights or remedies thereon. No delay or omission of
any Owner to exercise any right or power accruing upon any default will impair any right or power or will
be construed to be a waiver of any default. Every substantive right and every remedy conferred upon the
Owners of the Bonds by this Ordinance may be enforced and exercised from time to time and as often as
may be expedient. If any Owner discontinues any proceeding or the decision in the proceeding is against
the Owner, the City and the Owners of the Bonds will be restored to their former positions and rights
under this Ordinance.
Section 1005. No Obligation to Levy Taxes. Nothing in this Ordinance imposes any duty or
obligation on the City to levy any taxes either to meet any obligation incurred under this Ordinance or to
pay the principal of or interest on the Bonds.
ARTICLE XI
DEFEASANCE
Section 1101. Defeasance. When all of the Bonds have been paid and discharged, the
provisions of this Ordinance (other than Section 807) will terminate. Bonds will be treated as paid and
discharged within the meaning of this Ordinance if the City has deposited with the Paying Agent, or other
bank or trust company located in the State, having full trust powers and meeting the requirements of a
successor Trustee under the Indenture, (i) moneys and non—callable Defeasance Securities which,together
with interest to be earned, as evidenced by the written report of an independent certified public
accountant, will be sufficient for the payment of the principal and redemption premium, if any, of and
• interest to accrue on the Bonds to the date of maturity or redemption, plus an additional premium on
Bonds being optionally redeemed equal to interest that would otherwise accrue on the Bonds for an
additional 30-1ay period, and (ii) an opinion of Bond Counsel, addressed to the Authority and the
Trustee, that providing for the payment of the Bonds by depositing moneys or Defeasance Securities with
the Paying Agent in accordance with this Section will not cause the interest on the Authority Bonds to be
included in gross income for federal income tax purposes. If any Bonds will be redeemed prior to
maturity,the City must have given irrevocable instructions to the Paying Agent to redeem the Bonds. Any
moneys and obligations which at any time are deposited with the Paying Agent or other bank by or on
behalf of the City, for the purpose of paying and discharging any of the Bonds, are assigned, transferred
and set over in trust for the applicable Owners, and the moneys and obligations are irrevocably
appropriated to the payment and discharge of the applicable Bonds.
ARTICLE XII
AMENDMENTS
Section 1201. Amendments.
(a) Any provision of the Bonds or of this Ordinance may be amended by an ordinance with
the written consent of the Authority and the Trustee. Consent must be evidenced by an instrument
executed by the Authority and the Trustee, acknowledged or proved in the manner of a deed to be
recorded, and filed with the City Clerk. In addition, the prior written consent of the Owner and DNR is
required for any amendment that would:
• (1) extend the maturity of any payment of principal or interest on any Bond;
(2) reduce the amount of principal or interest payable on any Bond; or
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(3) permit the priority of any Bond over any other Bond.
(b) No amendment will be effective until (i) the City has delivered to the Owner, the Trustee
and DNR an opinion of Bond Counsel stating that the amendment is permitted by this Ordinance and the
Act, complies with their respective terms, is valid and binding upon the City in accordance with its terms
and does not adversely affect the exclusion of interest on the Authority Bonds from gross income for
federal income tax purposes, and (ii) the City Clerk has on file a copy of the amendment and all required
consents.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 1301. Further Authority. The officers of the City, including the Mayor, the City
Administrator and the City Clerk, are authorized and directed to execute all documents and take the
actions as are necessary or advisable in order to carry out and perform the purposes of this Ordinance and
to make ministerial changes in the documents approved by this Ordinance which they may approve. The
execution of any document or taking of any related action constitutes conclusive evidence of the necessity
or advisability of the action or change.
Section 1302. Severability. If any section or other part of this Ordinance is for any reason held
invalid,the invalidity will not affect the validity of the other provisions of this Ordinance.
Section 1303. Governing Law. This Ordinance is governed by and will be construed in
accordance with the laws of the State.
Section 1304. Effective Date. This Ordinance is in full force and effect from and after its
passage by the City Council and approval by the Mayor.
PASSED by the City Council of the City of Jefferson,Missouri this 6th day of October, 2008.
�Q
Passed: U Approve • n
residing Officer Mayor
ATTEST: APPROVE S TO FORM:
I
city Cl City Counselor
(SEAL) i
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• EXHIBIT A
TERMS OF BONDS
1. Original Principal Amount of the Bonds: Not to exceed$3,900,000.
2. Purchase Price: Not less than 98%of the Original Principal Amount.
3. Weighted Average Maturity of the Bonds: Not less than 9.9 years nor more than 13.9
years.
4. Effective Interest Cost: Not to exceed 2.3%. `Effective Interest Cost" means the
discount rate that, when used in computing the present value, as of the issue date of the
Bonds, of all Payments (defined below) expected to be paid on the Bonds, produces an
amount equal to the deposit to the City's Construction Account. For this purpose, the
term "Payments" means the sum of (a) all payments of principal and interest on the
Bonds, less (b) allocable interest earnings on the City's Reserve Account (calculated
assuming the Reserve Account is fully funded on the date of issuance of the Bonds),plus
(c) the Administrative Fee. Effective Interest Cost is expressed as an annual percentage
rate, and present value is computed on a semiannual basis using a 30/360 day-count
convention.
• 5. Costs of Issuance: Not to exceed$88,000.
I
•
A-1
• EXHIBIT B
FORM OF BOND
[THIS BOND IS TRANSFERABLE ONLY TO ANY SUCCESSOR TO THE
STATE ENVIRONMENTAL IMPROVEMENT AND ENERGY
RESOURCES AUTHORITY OR ITS ASSIGNS]
UNITED STATES OF AMERICA
STATE OF MISSOURI
Registered Registered
No. R— $
CITY OF JEFFERSON,MISSOURI
SEWERAGE SYSTEM REVENUE BOND
(STATE REVOLVING FUND PROGRAM)
SERIES 2008
Interest Rates Maturity Dates Dated Date
See Schedule I See Schedule I
• REGISTERED OWNER: STATE ENVIRONMENTAL IMPROVEMENT AND ENERGY
RESOURCES AUTHORITY
PRINCIPAL AMOUNT: ** DOLLARS**
THE CITY OF JEFFERSON, MISSOURI, a constitutional charter city and political subdivision
of the State of Missouri (the "City"), for value received, hereby promises to pay to the Owner shown
above, or registered assigns,the Principal Amount shown above in installments in the amounts and on the
Maturity Dates referenced above, and to pay interest thereon at the annual Interest Rates referenced above
(computed on the basis of a 360—day year of twelve 30—day months), payable semiannually on January 1
and July 1 in each year, commencing July 1, 2009 (each an "Interest Payment Date"), from the Dated
Date shown above or from the most recent Interest Payment Date to which interest has been paid or duly
provided for until the Principal Amount has been paid.
The principal of and redemption premium, if any, on this Bond will be paid at maturity or upon
earlier redemption to the person in whose name this Bond is registered at the maturity or redemption date,
upon presentation and surrender of this Bond at the principal office of UMB BANK, N.A. in the City of
St. Louis, Missouri (the "Paying Agent"). The interest payable on this Bond on any Interest Payment
Date will be paid by check or draft mailed by the Paying Agent to the person in whose name this Bond is
registered on the registration books maintained by the Paying Agent at the close of business on the Record
Date. The Record Date is the fifteenth day (whether or not a business day) of the calendar month next
preceding the Interest Payment Date. The principal of and redemption premium, if any, and interest on
• the Bonds is payable by electronic transfer in immediately available federal funds to a bank in the
continental United States of America pursuant to instructions from the Owner received by the Paying
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• Agent prior to the Record Date. The principal of, redemption premium, if any, and interest on this Bond
is payable in lawful money of the United States of America.
This Bond is one of a duly authorized series of bonds of the City designated "Sewerage System
Revenue Bonds (State Revolving Fund Program) Series 2008" aggregating the principal amount of
$ (the"Bonds"), issued by the City for the purpose of extending and improving its sewerage
system (together with all future improvements and extensions, the "System"), under the authority of and
in full compliance with Chapter 250 of the Revised Statutes of Missouri and pursuant to an election duly
held in the City and an ordinance adopted by the governing body of the City (the "Ordinance"). Terms
not otherwise defined in this Bond have the meanings set forth in the Ordinance.
Term Bonds, if any, are subject to mandatory redemption and payment prior to maturity pursuant
to the mandatory redemption requirements of the Ordinance, at a redemption price equal to 100% of the
principal amount plus accrued interest to the redemption date.
At the option of the City, certain Bonds may be called for redemption and payment prior to
maturity in whole or in part on any date with the consent of the Owner, as provided in the Ordinance.
Bonds will be optionally redeemed in part in integral multiples of $5,000 from the maturities
selected by the City with the prior written consent of the Owner. Upon redemption, the sinking fund
redemption amounts for each maturity will be proportionately reduced, subject to rounding to integral
multiples of$5,000. The City will give written notice to the Paying Agent, as trustee (the "Trustee"),
designating the amount of each maturity redeemed and the reduction in each sinking fund installment,
subject to verification by the Trustee. In exercising its option to redeem the Bonds, the City will deposit
• with the Paying Agent, in addition to the principal of, premium, if any, and interest on the Bonds, an
additional premium equal to 30-lays' interest on the Bonds to be redeemed for an additional 30-day
period.
The Paying Agent will give notice of optional redemption, unless waived, by mailing a
redemption notice by regular mail at least 45 days prior to the date fixed for optional redemption, to the
Owner of each Bond to be redeemed at the address shown on the Bond Register. If notice of redemption
has been given or waived, the Bonds or portions of Bonds called for redemption will become due and
payable on the redemption date at the redemption price specified in the notice. No notice of mandatory
sinking fund redemption is required to be given. From and after the redemption date the Bonds called for
redemption will cease to bear interest unless the City defaults in the payment of the redemption price.
The Bonds are limited obligations of the City payable solely from, and secured as to the payment
of principal and interest by a pledge of, the Net Revenues. The taxing power of the City is not pledged to
the payment of the Bonds either as to principal or interest. The Bonds do not constitute a general
obligation of the City or an indebtedness of the City within the meaning of any constitutional, statutory or
charter provision, limitation or restriction. Under the conditions set forth in the Ordinance, the City has
the right to issue additional parity bonds payable from, and secured by,the Net Revenues.
The Bonds are issued on parity with respect to payment of principal and interest from the Net
Revenues and in all other respects with the Outstanding Parity Bonds(as defined in the Ordinance).
The City covenants with the Owner of this Bond to keep and perform all covenants and
agreements contained in the Ordinance, and the City will fix, establish, maintain and collect rates, fees
• and charges for the use and services furnished by or through the System to produce Revenues sufficient to
pay the operation and maintenance costs of the System,pay the principal of and interest on the Bonds and
provide reasonable and adequate reserve funds. Reference is made to the Ordinance for a description of
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• the agreements made by the City with respect to the collection, segregation and application of the
Revenues,the nature and extent of the security for the Bonds,the rights, duties and obligations of the City
with respect to the Bonds, and the rights of the Owners.
The Bonds are issuable in the form of fully registered Bonds without coupons in the
denomination of$5,000 or any integral multiple of$5,000.
This Bond may be transferred or exchanged, as provided in the Ordinance, only upon the
registration books kept for that purpose at the above—mentioned office of the Paying Agent. Upon
surrender of any Bond at the principal office of the Paying Agent, the Paying Agent will transfer or
exchange the Bond for a new Bond or Bonds in any authorized denomination of the same maturity and in
the same aggregate principal amount as the Bond which was presented for transfer or exchange. All
Bonds presented for transfer or exchange must be accompanied by a written instrument of transfer or
authorization for exchange, in a form and with guarantee of signature satisfactory to the Paying Agent,
duly executed by the Owner or by the Owner's authorized agent. All Bonds presented for transfer or
exchange must be surrendered to the Paying Agent for cancellation. For every exchange or transfer of
Bonds the City or the Paying Agent may levy a charge sufficient to reimburse it for any tax, fee or other
governmental charge required to be paid for the exchange or transfer. The person requesting the exchange
or transfer must pay the charge. Payment of the charge is a condition precedent to the exchange or
transfer.
This Bond will not be valid or be entitled to any security or benefit under the Ordinance until the
Paying Agent has executed the Certificate of Authentication.
• IT IS HEREBY CERTIFIED AND DECLARED that all acts, conditions and things required to
exist, happen and be performed precedent to the issuance of the Bonds have existed, happened and been
performed in due time, form and manner as required by law, and that before the issuance of the Bonds,
provision has been duly made for the collection, segregation and application of the income and revenues
of the System as provided in the Ordinance.
IN WITNESS WHEREOF, the City of Jefferson, Missouri, has executed this Bond by causing it
to be signed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile
signature of its City Clerk, with its official seal affixed or imprinted.
(SEAL) CITY OF JEFFERSON,MISSOURI
ATTEST:
By
City Clerk Mayor
•
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• CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds of the issue described in the within—mentioned Ordinance.
Registration Date:
UMB BANK,N.A.,Paying Agent
By
Authorized Signatory
RECORD OF PRINCIPAL PAYMENTS AND PREPAYMENTS
Under the provisions of the Ordinance, payments of the principal installments of this Bond and
partial prepayments of the principal of this Bond may be made directly to the Owner without surrender of
this Bond to the Paying Agent. Accordingly, any purchaser or other transferee of this Bond should verify
with the Paying Agent the principal of this Bond outstanding prior to any purchase or transfer, and the
records of the Paying Agent are conclusive.
•
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• —___--_-- –
ASSIGNMENT
FOR VALUE RECEIVED,the undersigned hereby sells, assigns and transfers unto
UMB BANK,N.A.
Print or Type Name of Transferee
the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints UMB Bank,
N.A. agent to transfer the within Bond on the registration books kept by the Paying Agent, with full
power of substitution in the premises.
STATE ENVIRONMENTAL IMPROVEMENT
AND ENERGY RESOURCES AUTHORITY
Date: By:
Chairman
•
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City ofkffersor,Missouri
•
SCHEDULEITO
CITY OF JEFFERSON,MISSOURI
SEWERAGE SYSTEM REVENUE BOND
(STATE REVOLVING FUND PROGRAM)
SERIES 2008
[insert Maturity Schedule from Certificate of Final Terms]
•
B-1-1
CERTIFICWrE OF FINAL TERIVIS
AOL
p
C4
DI
EXHIBIT D
• FORM OF CLOSING CERTIFICATE
PARTICIPANT CLOSING CERTIFICATE
CITY OF JEFFERSON, MISSOURI
We, the undersigned, duly authorized officials of the City of Jefferson, Missouri (the
"Participant"), in connection with the issuance of Sewerage System Revenue Bonds (State Revolving
Fund Program) Series 2008 (the "Bonds") in the original principal amount set forth in Exhibit A to this
Certificate(the"Original Principal Amount"),hereby certify as follows:
1. Oreanization and Authority; Definitions. The Participant is a constitutional charter city,
organized and existing under the constitution and laws of the State of Missouri. The Participant has
complied with all provisions of the Constitution and the laws of the State of Missouri, and has full power
and authority to consummate all transactions contemplated by the Bonds, Ordinance No.
adopted on October 6, 2008, authorizing the issuance of the Bonds (the"Bond Ordinance"), and any and
all other agreements relating thereto. Terms not otherwise defined in this Certificate have the respective
meanings set forth in the Bond Ordinance.
2. Transcript of Proceedings. The executed counterparts or copies of the proceedings of the
Participant relating to the authorization and issuance of the Bonds as set forth in the supplemental
transcript of proceedings (the "Transcript") prepared in connection with the issuance of the Authority
Bonds are true and correct copies or executed counterparts of such proceedings, originals or executed
counterparts of which are on file in the official records of the Participant; none of such proceedings have
been modified, amended or repealed; and such facts as are stated therein still exist.
• 3. Meetines. All meetings of the City Council of the Participant as shown in the Transcript
were regular meetings, or meetings held pursuant to regular adjournment at the next preceding meeting,
or special meetings duly called and held as shown in the Transcript, and for all such meetings, where
required, proper notice was given in the manner required by law, including Chapter 610 of the Revised
Statutes of Missouri, as amended.
4. Incumbencv. The following named persons are the duly qualified and acting members of
the City Council and officers of the Participant during the proceedings described herein:
Name Title
John Landwehr Mayor
Carrie Carroll Councilmember
Kenneth Ferguson Councilmember
Mike Harvey Councilmember
Dan Klindt Councilmember
Rich Koon Councilmember
Cindy Layton Councilmember
Ron Medin Councilmember
Jim Penfold Councilmember
Anita Randolph Councilmember
Phyllis Powell City Clerk
• 5. Execution of Bonds. We have duly signed and executed the Bonds, consisting of one
fully registered bond in the denomination of the Original Principal Amount, numbered R-1. On the date
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• of the Bonds, and on the date when we duly executed the Bonds, we were, and at the date hereof we are,
the officials indicated by our signatures on the Bonds and by our signatures to this Certificate,
respectively.
6. Sip-natures and Seal. The signatures of us and each of us, as such officials, respectively,
on the Bonds, are our true and genuine signatures, and the seal affixed or imprinted on the Bonds at the
time of their execution was and is the duly authorized seal of the Participant and was thereto affixed by
the authority and direction of the City Council of the Participant, and is the seal affixed to this Certificate.
7. Due Authorization and Execution of Documents. The Participant has duly authorized all
necessary action to be taken by the Participant for(i) the due authorization, adoption and performance of
the following documents (the "Bond Documents") in connection with the Water Pollution Control and
Drinking Water Revenue Bonds (State Revolving Funds Programs) Series 2008A (the "Authority
Bonds"):
(a) Purchase Agreement dated as of October 1, 2008 (the"Purchase Agreement"), among the
State Environmental Improvement and Energy Resources Authority(the"Authority"),the
Participant and the Missouri Department of Natural Resources("DNR"), and
(b) Revolving Fund Agreement dated as of October 1, 2008 (the "Revolving Fund
Agreement"), among the Authority, the Participant and DNR, and acknowledged and
accepted by the Trustee;
(ii) the due authorization, execution and delivery of the Bond Ordinance and any and all such other
• agreements and documents as may be required to be executed, delivered and received by the Participant
in order to carry out, give effect to and consummate the transactions contemplated by the Bond
Ordinance; and (iii)the carrying out, giving effect to and consummation of the transactions contemplated
hereby and by the Bond Ordinance. The undersigned have duly executed the Bond Documents and this
Certificate.
8. Approval of Bond Terms. Attached to this Certificate is a true and correct copy of the
Certificate of Final Terms executed by the undersigned and attached to the Bond Ordinance as Exhibit C,
pursuant to the delegation of authority under Section 210 of the Bond Ordinance. The undersigned
Mayor certifies that the requirements of the Bond Ordinance with respect to the terms of the Bonds have
been satisfied.
9. Receipt of Purchase Price, Deposit of Proceeds and Other Moneys.
(a) The Participant hereby acknowledges receipt from the Authority of payment in full of the
purchase price for the Bonds in the amount of $ plus accrued interest, if any. The
Participant further acknowledges that the Authority has in all respects complied with and satisfied all of
its obligations to the Participant as set forth in the Purchase Agreement and required to be complied with
and satisfied on or prior to the date of delivery of and payment for the Bonds.
(b) The Paying Agent, in its role as Trustee under the Indenture, is further authorized and
directed to deposit and apply such sums, into the Funds and Accounts established under the Indenture as
follows:
• (1) into the Costs of Issuance Fund an amount equal to the Costs of Issuance in
Exhibit A,
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• (2) into the Construction Account the remaining proceeds of the Bonds; and
(3) Into the Construction Account the remaining proceeds of the Bonds with the
amount specified in Exhibit A deposited in the Capitalized Interest Subaccount.
(c) Immediately upon receipt of these moneys, the Trustee shall invest all amounts in the
Participant's Construction Account in the Investment Agreement. The Trustee is directed to apply the
amount deposited pursuant to (b)(1) above for the payment of the Participant's allocable portion of the
costs of issuing the Authority Bonds and the Participant's costs of issuance.
10. No Litigation; Other Matters.
(a) To the best knowledge of the undersigned, the Participant is not in breach of or in default
under any applicable law or administrative regulation of the State of Missouri or the United States of
America, or any department, agency or instrumentality thereof, or any applicable judgment or decree or
any indenture,ordinance/resolution,agreement or other instrument to which the Participant is a party or is
otherwise subject,which breach or default would in any way materially adversely affect the authorization,
sale or issuance of the Bonds and no event has occurred as is continuing which, with the passage of time
or the giving of notice or both, would constitute such breach or default under any such instrument. The
execution and delivery of the Bond Documents and the Bonds, and compliance with the provisions of
each thereof, will not conflict with or constitute in any material respect a breach of or default under any
law, administrative regulation, judgment, decree, indenture, ordinance/resolution, agreement or other
instrument to which the Participant is a party or is otherwise subject.
• (b) There is no action, suit,proceeding, inquiry or investigation, at law or in equity,before or
by any court, public board or body, for which the Participant has been served with process or official
notice or, to the best of the Participant's knowledge, threatened against the Participant affecting its
corporate existence or the titles of its officers to their respective offices or seeking to prohibit, restrain or
enjoin the authorization, sale or issuance of the Bonds or the collection of the revenues and other moneys
pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof by the
Authority pursuant to the Indenture, or in any way contesting or affecting the validity or enforceability of
the Bonds, the Bond Ordinance or the Bond Documents, contesting the federal tax-exempt status of the
Authority Bonds or contesting the powers of the Participant or any authority for the issuance of the
Bonds, or the execution or delivery of the Bonds, the Bond Ordinance, the Bond Documents or this
Certificate.
(c) No further consent, approval, authorization or order of any court or governmental agency
or body of the State of Missouri is required by the Participant for the authorization, sale or issuance of the
Bonds or the consummation by the Participant of the other transactions effected or contemplated in
connection with the issuance of the Bonds.
11. No Default. At the date of this Closing Certificate, no event has occurred and is
continuing which, with the passage of time or the giving of notice, would constitute a breach of or an
event of default under the Bond Ordinance or any Bond Document.
12. Request to Authenticate and Deliver Bonds. UMB Bank, N.A., as Paying Agent, is
hereby requested and authorized, pursuant to Section 207 of the Bond Ordinance, to authenticate the
Bonds in the Original Principal Amount and to deliver the Bonds to, or at the direction of, the Authority,
• upon payment to the Paying Agent for the account of the Participant of the purchase price for the Bonds
specified in paragraph 9 of this Certificate.
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• 13. Outstanding System Obligations. As of the date hereof, the Participant does not have
outstanding any bonds or other obligations payable out of the net income and revenues derived from the
operation of the System other than the Bonds and the Outstanding Parity Bonds. No event has occurred
and is continuing which, with the passage of time or the giving of notice,would constitute a breach of or an
event of default under the Bond Ordinance and the Outstanding Parity Bond Ordinances.
14. Tax Representations and Covenants. The Participant makes the representations and
covenants as set forth in Exhibit B. Exhibit B constitutes an integral part of this Certificate.
15. Reliance. The undersigned acknowledge and agree that this Certificate is being relied upon
by the Authority in connection with the issuance and sale of the Authority Bonds,by the underwriters of the
Authority Bonds in connection with their purchase of the Authority Bonds, by the Participant's bond
counsel in connection with the delivery of their approving legal opinion with respect to the Bonds, and by
the Authority's Co-Bond Counsel in connection with their approving legal opinions with respect to the
Authority Bonds.
WITNESS our hands and the seal of the City of Jefferson, Missouri this 30th day of October,
2008.
SigLiature Official Title
Mayor
(Seal)
City Clerk
•
D-4
CERTIFICATE OF FINAL TERMS
The undersigned Mayor of the City of Jefferson, Missouri (the "City"), in connection with the
issuance of the City's Sewerage System Revenue Bonds(State Revolving Fund Program) Series 2008 (the
"Bonds"), certifies pursuant to Section 210 of Ordinance No. of the City(the"Bond Ordinance"),
as follows(section references are to the cited section of the Bond Ordinance):
1. Original Principal Amount—Section 201. The Bonds are issued in the Original Principal
Amount of$
2. Maturity Schedule—Section 203. The Bonds will mature on the dates and in the amounts
and bear interest at the rates as follows:
Maturity Principal Interest
January 1 Amount Rate
i
i
I
I
t Term Bond
3. Weighted Average Maturity of the Bonds: The weighted average maturity of the Bonds is
years, as shown on Schedule 1 to this Certificate.
4. Effective Interest Cost: The Effective Interest Cost of the Bonds, determined in
accordance with Exhibit A to the Bond Ordinance, is %, as shown on Schedule 2
to this Certificate.
5. Purchase Price— Section 210. The purchase price of the Bonds is $ which is
of the Original Principal Amount.
D-5
III
• 6. Mandatory Sinking Fund Redemption — Section 301. [**There are no Term Bonds
subject to mandatory sinking fund redemption prior to maturity.**][**The Term Bonds
identified in paragraph 2 are subject to mandatory sinking fund redemption pursuant to
Section 301 on the dates and in the amounts as follows:
**]
7. Optional Redemption — Section 302. At the option of the City, Bonds maturing on
January 1, and thereafter are subject to redemption in whole or in part on any date,
with the consent of the Owner, or on each July 1 and January 1, commencing 1,
. at the redemption price(s) (expressed as percentages of the principal amount of the
Bonds redeemed) set forth below, plus the redemption premium as set forth in Section
302,plus accrued interest to the redemption date:
• 8. Costs of Issuance. The City directs the deposit of$ from the proceeds of
the Bonds to the Costs of Issuance Fund for application to the payment of costs of
issuance.
The terms set forth in this Certificate of Final Terms are within the limitations of Exhibit A to the
Bond Ordinance.
Delivered this day of
CITY OF JEFFERSON, MISSOURI
By:
Mayor
I
III
•
D-6
EXHIBIT B
TAX REPRESENTATIONS AND COVENANTS
This Exhibit B constitutes an integral part of the Participant Closing Certificate to which it is
attached(collectively,the"Closing Certificate").
1. Meaning of Words and Terms. Words and phrases used in this Exhibit B generally have
the meanings assigned in §§ 103 and 141-150 of the Internal Revenue Code of 1986, as amended (the
"Code"), in the applicable U.S. Treasury Regulations (the "Regulations"), and in the Bond Ordinance.
The following words and terms used in Exhibit B have the following meanings:
"Bond Year" means each one-year period (or shorter period for the first Bond Year) ending
January 1.
"Code"means the Internal Revenue Code of 1986, as amended.
"Financed Facility" means the property financed with the proceeds of the Bonds as described on
the Participant's signature page to the Purchase Agreement.
"Governmental Person" means a State, territory, a possession of the United States, the District of
Columbia, or any political subdivision thereof or any instrumentality of such unit. It does not include the
United States or any agency or instrumentality thereof.
• "Issue Date"means the date of issuance of the Bonds.
"Measurement Period" means, with respect to each item of property financed as part of the
Financed Facility, the period beginning on the later of(i) the Issue Date or (ii) the date the property is
placed in service and ending on or the earlier of (A) the final maturity date of the Bonds or (B) the
expected economic useful life of the property.
"Nongovernmental Person"means a person other than a Governmental Person.
2. Authority and Purpose for Bonds. The Bonds are being issued for the purpose of
providing funds to pay the costs of the Financed Facility.
3. No Over-issuance, Other Sources.
(a) The sale proceeds of the Bonds, together with expected investment earnings on such
proceeds, do not exceed the cost of the governmental purpose of the Bonds as described above.
(b) In addition to proceeds of the Bonds, the Participant will allocate the sum of$8,800.00
representing a cash contribution by the Participant to pay a portion of the costs of the Financed Facility.
4. Governmental Bond Tests and Related Requirements.
(a) General. The Participant will not use any portion of the Bond proceeds, including any
• investment earnings on such proceeds, directly or indirectly, nor permit the use of any portion of the
Financed Facility, in a manner that would cause any Bond to be a "private activity bond" as defined in
Code § 141.
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(b) Use of Financed Facility. The Bond proceeds will be used to finance or refinance the
Financed Facility. Throughout the Measurement Period, all property comprising the Financed Facility
has been and will be owned by the Participant or another Governmental Person has owned and will own
the Financed Facility. Not more than 10% of the proceeds of the Bonds will be used in a manner that
constitutes a "private business use" during the Measurement Period. In making the foregoing
representations the Participant acknowledges that (i)use of the property comprising the Financed Facility
is determined annually throughout the Measurement Period; (ii)the use of the Financed Facility is treated
as the direct use of proceeds of the Bonds; (iii) the term "private business use" generally means
ownership or lease by, or other use in the trade or business of, a"Nongovernmental Person," as set forth
in Regulations § 1.141-3; (iv) any activity carried on by a Nongovernmental Person other than a natural
person is treated as a trade or business; (v) the Financed Facility is treated as being used for a private
business use if it is leased to a Nongovernmental Person and subleased to a Governmental Person, or
leased to a Governmental Person and then subleased to a Nongovernmental Person, if the
Nongovernmental Person's use is in a trade or business; and (vi) in most cases, use of the Financed
Facility constitutes private business use only if a Nongovernmental Person has special legal entitlements
to use the financed property under an arrangement with the Participant.
(c) Private Security or Payment. The payment of principal and interest on the Bonds will not
be(under the terms of the Bonds or any underlying arrangement)directly or indirectly:
(1) secured by (i) any interest in property used or to be used for a private business
use, or(ii)any interest in payments in respect of such property; or
• (2) derived from payments (whether or not such payments are made to the
Participant) in respect of property, or borrowed money, used or to be used for a private business
use.
For purposes of the foregoing, taxes of general application are not treated as a private payment or as
private security so long as no taxpayer enters into any "impermissible agreement" with respect to the
collection or payment of the tax as described in Regulation §1.141-4(e)(4)(ii). The Participant will use
revenues derived from the operation of the Financed Facility to pay the debt service on the Bonds. All
revenues will be derived from rates that are generally applicable and uniformly applied, and which do not
convey priority rights or other preferential benefits for use of the Financed Facility.
(d) No Private Loan. No proceeds of the Bonds will be loaned directly or indirectly to any
person or entity that is not a State or local governmental unit. Special assessments may be used as source
of repayment of the Bonds so long as the assessments meet the criteria set out in Regulation§1.141-5(d).
(e) No Federal Guarantees. The Participant will not take any action or permit any action to
be taken which would cause the Bonds to be"federally guaranteed"within the meaning of Code § 149(b).
(f) Management Contracts. The Participant will not enter into or renew any "management
contract" (defined below) with any Nongovernmental Person, without first obtaining an opinion of bond
counsel, addressed to the Participant and the Authority, that such management contract will not adversely
affect the exclusion of the interest on the Authority Bonds from gross income for federal income tax
purposes. The term "management contract" is defined in Regulations § 1.141-3(b) as a management,
service, or incentive payment contract with an entity that provides services involving all or a portion of
• any function of the Financed Facility, such as a contract to manage the Financed Facility or any portion
thereof. Contracts for services that are solely incidental to the primary governmental function of the
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• Financed Facility (for example, contracts for janitorial, office equipment repair, billing, or similar
services)are not treated as management contracts.
(g) Leases. The Participant will not enter into or renew a lease of all or any portion of the
Financed Facility (disregarding portions used by members of the general public who use portions of the
Financed Facility on a short-term basis in the ordinary course of the Participant's operation of the
Financed Facility) with any Nongovernmental Person, without first obtaining an opinion of bond counsel,
addressed to the Participant and the Authority, that such lease will not adversely affect the exclusion of
the interest on the Authority Bonds from gross income for federal income tax purposes.
5. Sinking. The Participant is required under the Bond Ordinance to make periodic
payments in amounts sufficient to pay the principal of and interest on the Bonds. The Participant will
deposit these payments into the Principal Account and the Interest Account held by the Trustee. Except
for the Principal Account and the Interest Account, the Participant has not established, and does not
expect to establish, any sinking fund or other similar fund expected to be used directly or indirectly to pay
principal of or interest on the Bonds. The Principal Account and the Interest Account are used primarily
to achieve a proper matching of revenues with principal and interest payments on the Bonds within each
bond year and the Participant expects that the Principal Account and the Interest Account will qualify as a
"bona fide debt service fund,"as said term is defined in the Regulations.
6. No Replacement Funds. None of the Bond proceeds will be used as a substitute for other
funds that were intended or earmarked to pay costs of the Financed Facility, and that have been or will be
used to acquire higher yielding investments. Except for the Principal Account, the Interest Account and
the Reserve Account, there are no other funds pledged or committed in a manner that provides a
• reasonable assurance that such funds would be available for payment of the principal of or interest on the
Bonds if the Participant encounters financial difficulty.
7. Reimbursement of Expenditures. On November 7, 2000, the governing body of the
Participant adopted an ordinance declaring the intent of the Participant to borrow to finance costs of the
Financed Facility for the Participant, and to reimburse the Participant for expenditures made for the
Financed Facility prior to the issuance of such obligations (the"Reimbursement Action"). A copy of the
Reimbursement Action is contained in the Transcript. No portion of the Net Proceeds of the Bonds will
be used to reimburse an expenditure paid by the Participant more than 60 days prior to the date the
Reimbursement Action was adopted. The Participant will evidence in writing each allocation of the
proceeds of the Bonds to an expenditure. No reimbursement allocation will be made for an expenditure
made more than three years prior to the date of the reimbursement allocation. In addition, no
reimbursement allocation will be made more than 18 months following the later of(A) the date of the
expenditure or(B)the date the Financed Facility was placed in service.
8. Hedize Bonds. The Participant expects that at least 85% of the net sale proceeds of the
Bonds will be used to carry out the governmental purpose of the Bonds within three years after the Issue
Date.
9. Records. The Participant recognizes that(i) investors purchase the Authority Bonds with
the expectation that interest on the Authority Bonds is and will remain excludable from gross income for
Federal income tax purposes, (ii)the tax-exempt status of interest on the Authority Bonds depends in part
on the accuracy of the Participant's representations and the satisfaction of the Participant's covenants
contained in this Closing Certificate, many of which relate to matters that will occur after the date the
• Bonds are issued, and (iii) as part of its ongoing tax-exempt bond audit program the Internal Revenue
Service requires that records be created and maintained with respect to the following matters:
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(1) documentation evidencing the expenditure of Bond proceeds in sufficient detail
to determine the date of the expenditure,the asset acquired or the purpose of the expenditure.
(2) documentation evidencing the use of the Financed Facility by public and private
persons(for example, copies of management contracts or leases).
(3) documentation evidencing all sources of payment or security for the Bonds.
The Participant has procedures in place or will establish procedures to create and retain these records.
Unless otherwise specifically instructed in a written opinion of Bond Counsel, the Participant will retain
and maintain these records for a period ending not earlier than three years following the final maturity of
(i) the Bonds or (ii) any obligation issued to refund the Bonds. Any records maintained electronically
must comply with Section 4.01 of Revenue Procedure 97-22.
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