1387 0000016
ORDINANCE NO. 1387 (# 30 -09)
AN ORDINANCE AUTHORIZING THE CONSTRUCTION OF
BETTERMENTS AND IMPROVEMENTS TO THE WASTEWATER
SYSTEM OF THE CITY OF JACKSONVILLE, ARKANSAS;
AUTHORIZING THE ISSUANCE AND SALE OF WASTEWATER
REFUNDING AND CONSTRUCTION REVENUE BONDS, SERIES
2009, IN ONE OR MORE SERIES; PROVIDING FOR THE PAYMENT
OF THE PRINCIPAL OF AND INTEREST ON THE BONDS;
PRESCRIBING OTHER MATTERS RELATING THERETO; AND
DECLARING AN EMERGENCY,
WHEREAS, the City of Jacksonville, Arkansas (the "City") owns a municipal
wastewater system (the "System "), which is operated by the Jacksonville Sewer
Commission of the City (the "Commission ");
WHEREAS, the Commission has determined that betterments and improvements
to the System (collectively, the "improvements ") are necessary in order to make the
services of the System adequate for the needs of the City;
WHEREAS, the Commission has caused to be prepared by Crist Engineers for the
Jacksonville Wastewater Utility (the "Utility") a preliminary report, general plans and
estimates of cost for the improvements that have been examined and approved by the
Commission and City Council and a copy of which general plans are on file in the offices
of the City Clerk and the General Manager of the System where they may be inspected
by any interested person;
WHEREAS, the Commission and the City Council have determined that the City
should refund its short-term Promissory Note (the "2006 Note ") authorized by
Ordinance No. 1270 ( #3 -06) of the City, adopted February 16, 2006 (the "2006 Note
Ordinance ");
WHEREAS, the City can refund the 2006 Note and pay the costs of one or more
of the improvements (or a portion thereof) by the issuance of Wastewater Refunding
and Construction Revenue Bonds in the aggregate principal amount of Eighteen Million
Three Hundred Thousand Dollars ($18,300,000,) (collectively, the "bonds ");
WHEREAS, the City and the Commission have made arrangements for the sale of
the bonds to Stephens Inc. (the "Purchaser "), at a price of $17,908,031.35
(representing the par amount of the Bonds less original issue discount of $208,968.65,
and less Underwriter's discount of $183,000) plus accrued interest on the bonds from
the date of the bonds until the date of issuance (the "Purchase Price "), on a negotiated
basis pursuant to a Bond Purchase Agreement (the "Agreement ") which has been
presented to and is before this meeting;
WHEREAS, the Preliminary Official Statement, dated October 26, 2009, offering
the bonds for sale (the "Preliminary Official Statement ") has been presented to and is
before this meeting;
WHEREAS, in order to comply with the applicable securities laws, it is necessary
that the City enter into a Continuing Disclosure Agreement between the City and Bank
of the Ozarks, Little Rock, Arkansas, as Dissemination Agent (the "Disclosure
Agreement "), providing for the ongoing disclosure obligations of the City with respect to
the bonds, and a copy of the Disclosure Agreement has been presented to and is before
this meeting; and,
843646 -v1
ORDINANCE NO. 1387 ( #30 - 09)
Page 2
000002
WHEREAS, the City has outstanding certain obligations pursuant to that certain
Loan Agreement No. 00095 - WSSW -D for Project No. WRD- 003 -314 by and between the
City and the Arkansas Natural Resources Commission, as successor to the Arkansas Soil
and Water Commission, dated as of August 1, 2003 (the "2003 Loan ") which was
authorized by Resolution No. 563 ( #8 -02) adopted by the City Council of the City on
. - — July 18, 2002 (the "2003 Loan Resolution ").
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF JACKSONVILLE, ARKANSAS:
SECTION ONE. The improvements and the refunding of the 2006 Note shall be
accomplished. The Mayor and City Clerk are hereby authorized to take, or cause to be
taken, all action necessary to accomplish the refunding of the 2006 Note and
completion of the improvements and to execute all required contracts in connection
therewith. The 2006 Note shall be redeemed in the amount of the outstanding principal
and accrued interest to the date of redemption. The accomplishment of the
improvements shall be under the control and supervision of, and all details in
connection therewith shall be handled by, the Commission, and the Commission shall
make all contracts and agreements necessary or incidental to the performance of its
duties and the execution of its powers. The Commission shall let all construction
contracts pursuant to and in accordance with existing laws and shall require such
performance bonds and insurance from the contractors as, in the judgment of the
Commission, will fully insure the completion of the improvements in accordance with
the plans and specifications therefor.
SECTION TWO. The City Council hereby finds and declares that the period of
usefulness of the improvements will be more than thirty (30) years, which is longer
than the term of the bonds.
SECTION THREE. The offer of the Purchaser for the purchase of the bonds
from the City at the Purchase Price for bonds bearing interest at the rates per annum,
maturing and otherwise subject to the terms and provisions hereafter in this Ordinance
set forth in detail be, and is hereby accepted, and the Agreement, in substantially the
form submitted to this meeting, is approved and the bonds are hereby sold to the
Purchaser. The Mayor's approval and execution of the Agreement on November 5,
2009, is hereby ratified, and the Mayor is hereby authorized to deliver the Agreement
on behalf of the City and to take all action required on the part of the City to fulfill its
obligations under the Agreement.
SECTION FOUR. The Preliminary Official Statement is hereby approved and
the previous use of the Preliminary Official Statement by the Purchaser in connection
with the sale of the bonds is hereby in all respects authorized and approved, and the
Mayor be, and he is hereby authorized and directed, for and on behalf of the City, to
execute the Preliminary Official Statement and the final Official Statement as set forth
in the Agreement.
SECTION FIVE. The Disclosure Agreement, in substantially the form submitted
to this meeting, is approved, and the Mayor is hereby authorized and directed to
execute and deliver the Disclosure Agreement on behalf of the City. The Mayor and the
General Manager of the Utility (the "General Manager ") are each authorized and
directed to take all action required on the part of the City to fulfill the City's obligations
under the Disclosure Agreement.
843646 -v1
ORDINANCE NO. 1387 (#30 — 09)
Page 3 000003
SECTION SIX. (a) Under the authority of the Constitution and laws of the
State of Arkansas (the "State "), including particularly Title 14, Chapter 164, Subchapter
4, and Title 14, Chapter 235, Subchapter 2 of the Arkansas Code of 1987 Annotated,
City of Jacksonville, Arkansas Wastewater Refunding Bonds (Federally Taxable) Series
2009A (the "Series 2009A Bonds ") are hereby authorized and ordered issued in the
principal amount of Three Million Nine Hundred Seventy Thousand Dollars
($3,970,000) for the purpose of refunding the 2006 Note, funding a debt service
reserve and paying costs incidental thereto and expenses of issuing the Series 2009A
Bonds. The Series 2009A Bonds shall bear interest at the rates and shall mature on the
dates and in the amounts as follows:
Maturity Principal Interest
(December 1) Amount Rate ( %)
2020 $3,970,000* 5.000%
(b) Under the Constitution and the laws of the State of Arkansas (the
"State "), including, particularly, Title 14, Chapter 164, Subchapter 4, and Title 14,
Chapter 235, Subchapter 2 of the Arkansas Code of 1987 Annotated, City of
Jacksonville, Arkansas Wastewater Construction Revenue Bonds, Series 2009B are
hereby authorized and ordered issued in the principal amount of Fourteen Million Three
Hundred Thirty Thousand Dollars ($14,330,000) for the purposes of financing all or a
portion of the costs of the improvements, funding a debt service reserve and paying
costs incidental thereto and expenses of issuing the Series 2009B Bonds. The Series
2009B Bonds shall bear interest at the rates and shall mature on the dates and in the
amounts as follows:
Maturity Principal Interest
(December 1) Amount Rate ( %)
2020 $ 100,000 4.000%
2021 485,000 4.125
2022 510,000 4.250
2023 530,000 4.300
2024 550,000 4.350
2025 575,000 4.375
2026 600,000 4.375
2027 625,000 4.500
2028 655,000 4.600
2029 685,000 4.600
2034 3,960,000* 5.000
2039 5,055,000* 5.000
*Term Bond, subject to mandatory sinking fund redemption.
(c) The bonds shall be dated December 1, 2009, with interest payable
semiannually on June 1 and December 1 of each year, commencing June 1, 2010, shall
be numbered consecutively from 1 upward, in order of issuance, and shall be issuable
only as fully registered bonds without coupons in the denomination of Five Thousand
_ -. Dollars ($5,000.00) or any integral multiple thereof. Each bond shall have a CUSIP
number. The bonds shall be registered as to principal and interest. Principal is payable
at the principal office of the Trustee. Payment of interest shall be by check or draft
mailed to the registered owner at the address shown on the registration book of the
City maintained by Bank of the Ozarks, Little Rock, Arkansas, as Trustee and Payment
Agent (the "Trustee ") at the close of business on the Fifteenth (15 day of the month
(whether or not a business day) next preceding each interest payment date (the
"Record Date "), irrespective of any transfer or exchange of any such bond subsequent
to such Record Date and prior to such interest payment date. The bonds will bear
interest from the dates and shall be subject to redemption prior to maturity as
hereinafter set forth in the bond forms.
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 4 000004
The bonds shall be registered initially in the name of Cede & Co., as nominee for
the Depository Trust Company ( "DTC "), which shall be considered to be the registered
owner of the bonds for all purposes under this Ordinance, including, without limitation,
payment by the City of principal of, redemption price, premium, if any, and interest on
the bonds, and receipt of notices and exercise of rights of registered owners. There
shall be one certificated, typewritten bond for each stated maturity date which shall be
immobilized in the custody of DTC with the beneficial owners having no right to receive
the bonds in the form of physical securities or certificates. DTC and its participants
shall be responsible for maintenance of records of the ownership of beneficial interests
in the bonds by book -entry on the system maintained and operated by DTC and its
participants, and transfers of ownership of beneficial interests shall be made only by
DTC and its participants, by book -entry, the City having no responsibility therefor. DTC
is expected to maintain records of the positions of participants in the bonds, and the
participants and persons acting through participants are expected to maintain records
of the purchasers of beneficial interests in the bonds. The bonds as such shall not be
transferable or exchangeable, except for transfer to another securities depository or to
another nominee of a securities depository, without further action by the City.
If any securities depository determines not to continue to act as a securities
depository for the bonds for use in a book -entry system, the City may establish a
securities depository/book -entry system relationship with another securities depository.
If the City does not or is unable to do so, or upon request of the beneficial owners of all
outstanding bonds, the City and the Trustee (hereinafter identified), after the Trustee
has made provision for notification of the beneficial owners by the then securities
depository, shall permit withdrawal of the bonds from the securities depository, and
authenticate and deliver bond certificates in fully registered form (in denominations of
Five Thousand Dollars ($5,000.00) or integral multiples thereof) to the assigns of the
securities depository or its nominee, all at the cost and expense (including costs of
printing definitive bonds) of the City, if the City fails to maintain a securities
depository/book -entry system, or of the beneficial owners, if they request termination
of the System.
Prior to issuance of the bonds, the City shall have executed and delivered to DTC
a written agreement (the "Representation Letter ") setting forth (or incorporating therein
by reference) certain undertakings and responsibilities of the City with respect to the
bonds so long as the bonds or a portion thereof are registered in the name of Cede &
Co. (or a substitute nominee) and held by DTC. Notwithstanding such execution and
delivery of the Representation Letter, the terms thereof shall not in any way limit the
provisions of this Section or in any other way impose upon the City any obligation
whatsoever with respect to persons having interests in the bonds other than the
registered owners, as shown on the registration books kept by the Trustee. The
Trustee shall take all action necessary for all representations of the City in the
Representation Letter with respect to the Trustee to at all times be complied with.
The authorized officers of the Trustee and the City shall do or perform such acts
and execute all such certificates, documents and other instruments as they or any of
them deem necessary or advisable to facilitate the efficient use of a securities
depository for all or any portion of the bonds; provided that neither the Trustee nor the
City may assume any obligations to such securities depository or beneficial owners of
bonds that are inconsistent with their obligations to any registered owner under this
Ordinance.
Each bond shall bear interest from the payment date next preceding the date on
which it is authenticated unless it is authenticated on an interest payment date, in
which event it shall bear interest from such date, or unless it is authenticated prior to
the first interest payment date, in which event it shall bear interest from December 1,
2009, or unless it is authenticated during the period from the Record Date to the next
interest payment date, in which case it shall bear interest from such interest payment
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 5 000005
date, or unless at the time of authentication thereof interest is in default thereon, in
which event it shall bear interest from the date to which interest has been paid.
Only such bonds as shall have endorsed thereon a Certificate of Authentication
substantially in the form set forth in Section 8 hereof (the "Certificate ") duly executed
by the Trustee shall be entitled to any right or benefit under this ordinance. No bond
shall be valid and obligatory for any purpose unless and until the Certificate shall have
been duly executed by the Trustee, and the Certificate upon any such bond shall be
conclusive evidence that such bond has been authenticated and delivered under this
Ordinance. The Certificate on any bond shall be deemed to have been executed if
signed by an authorized officer of the Trustee, but it shall not be necessary that the
same officer sign the Certificate on all of the bonds.
In case any bond shall become mutilated or be destroyed or lost, the City shall, if
not then prohibited by law, cause to be executed and the Trustee may authenticate and
deliver a new bond of like date, number, maturity and tenor in exchange and
substitution for and upon cancellation of such mutilated bond, or in lieu of and in
substitution for such bond destroyed or lost, upon the owner paying the reasonable
expenses and charges of the City and Trustee in connection therewith, and, in the case
of a bond destroyed or lost, his filing with the Trustee evidence satisfactory to it that
such bond was destroyed or lost, and of his ownership thereof, and furnishing the City
and Trustee with indemnity satisfactory to them. The Trustee is hereby authorized to
authenticate any such new bond. In the event any such bond shall have matured,
instead of issuing a new bond, the City may pay the same without the surrender
thereof. Upon the issuance of a new bond under this Section 6, the City may require
the payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
The City shall cause books for the registration and for the transfer of the bonds
as provided herein and in the bonds. The Trustee shall act as the bond registrar. Each
bond is transferable by the registered owner thereof or by his attorney duly authorized
in writing at the principal office of the Trustee. Upon such transfer a new fully
registered bond or bonds of the same maturity, of authorized denomination or
denominations, for the same aggregate principal amount will be issued to the
transferee in exchange therefor.
No charge shall be made to any owner of any bond for the privilege of transfer
or exchange, but any owner of any bond requesting any such transfer or exchange shall
pay any tax or other governmental charge required to be paid with respect thereto.
Except as otherwise provided in the immediately preceding sentence, the cost of
preparing each new bond upon each exchange or transfer and any other expenses of
the City or the Trustee incurred in connection therewith shall be paid by the City. The
City shall not be required to transfer or exchange any bonds selected for redemption in
whole or in part.
The person in whose name any bond shall be registered shall be deemed and
regarded as the absolute owner thereof for all purposes, and payment of or on account
of the principal or premium, if any, or interest on any bond shall be made only to or
upon the order of the registered owner thereof or his legal representative, but such
registration may be changed as hereinabove provided. All such payments shall be valid
and effectual to satisfy and discharge the liability upon such bond to the extent of the
sum or sums so paid.
In any case where the date of maturity of interest on or principal of the bonds or
the date fixed for redemption of any bonds shall be a Saturday or Sunday or shall be in
the State a legal holiday or a day on which banking institutions are authorized by law to
close, then payment of interest or principal (and premium, if any) need not be made on
such date but may be made on the next succeeding business day with the same force
843646 -v1
ORDINANCE NO. 1387 ( #30 — O9)
Page 6
000606
and effect as if made on the date of maturity or the date fixed for redemption, and no
interest shall accrue for the period after the date of maturity or date fixed for
redemption.
SECTION SEVEN. The bonds shall be executed on behalf of the City by the
manual or facsimile signatures of the Mayor and City Clerk/Treasurer and shall have
impressed or imprinted thereon the seal of the City. The bonds, together with interest
thereon, are secured by and are payable solely from the net revenues derived from the
System ( "System Revenues ") which are hereby pledged and mortgaged for the equal
and ratable payment of the bonds. The pledge of net System Revenues in favor of the
bonds shall be on a parity with the pledge in favor of the 2003 Loan.
SECTION EIGHT. The bonds and the Certificate shall be in substantially the
following forms and the Mayor and City Clerk/Treasurer are hereby expressly authorized
and directed to make all recitals contained therein:
843646 -v1
ORDINANCE NO. 1387 (#30 — 09)
Page 7 0000{Y7
(Form of Series 2009A Bond)
REGISTERED REGISTERED
No. RA -
UNITED STATES OF AMERICA
STATE OF ARKANSAS
COUNTY OF PULASKI
CITY OF JACKSONVILLE
WASTEWATER REFUNDING
REVENUE BONDS, SERIES 2009A
(Federally Taxable)
Maturity Date: Interest Rate:
Dated Date: December 1, 2009 CUSIP No.:
Registered Owner: Cede & Co.
Principal Amount:
KNOW ALL MEN BY THESE PRESENTS:
That the City of Jacksonville, County of Pulaski, State of Arkansas (the "City"),
for value received, hereby promises to pay, but solely from the source as hereinafter
provided and not otherwise, to the Registered Owner shown above upon the
presentation and surrender hereof at the principal corporate office of Bank of the
Ozarks, Little Rock, Arkansas, or its successor or successors, as Trustee and Paying
Agent (the "Trustee"), on the Maturity Date shown above, the Principal Amount shown
above, in such coin or currency of the United States of America as at the time of
payment shall be legal tender for the payment of public and private debts and to pay by
check or draft interest thereon, but solely from the source as hereinafter provided and
not otherwise, in like coin or currency from the interest commencement date specified
below at the Interest Rate per annum shown above, payable June 1, 2010, and
semiannually thereafter on the first days of June 1 and December 1 of each year, until
payment of such Principal Amount or, if this bond or a portion thereof shall be duly
called for redemption, until the date fixed for redemption, and to pay interest on
overdue principal and interest (to the extent legally enforceable) at the rate borne by
this bond. Payment of each installment of interest shall be made to the person in
whose name this bond is registered on the registration books of the City maintained by
the Trustee at the close of business on the fifteenth day of the month (whether or not a
business day) next preceding each interest payment date (the "Record Date "),
irrespective of any transfer or exchange of this bond subsequent to such Record Date
and prior to such interest payment date.
Unless this bond is presented by an authorized representative of The Depository Trust
Company, a New York corporation ( "DTC "), to the Trustee for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of Cede &
Co. or in such other name as is requested by an authorized representative of DTC (and
any payment is made to Cede & Co. or to such other entity as is required by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
This bond shall bear interest from the payment date next preceding the date on
which it is authenticated unless it is authenticated on an interest payment date, in
which event it shall bear interest from such date, or unless it is authenticated prior to
the first interest payment date, in which event it shall bear interest from the Dated Date
shown above, or unless it is authenticated during the period from the Record Date to
the next ,authenticated payment date, in which case it shall bear interest from such
interest payment date, or unless at the time of authentication hereof interest is in
843646 -v1
•
ORDINANCE NO. 1387 ( #30 — 09)
Page 8
default hereon, in which event it shall bear interest from the date to which interest has
been paid.
This bond is one of an issue of City of Jacksonville, Arkansas Wastewater
Refunding Revenue Bonds, Series 2009A, (Federally Taxable) aggregating Three Million
Nine Hundred Seventy Thousand Dollars ($3,970,000) in principal amount (the
"bonds "), and is issued for the purposes of refunding certain outstanding indebtedness
of the City, funding a debt service reserve, and paying expenses incidental thereto and
to the authorization and issuance of the Series 2009A Bonds.
The bonds are issued pursuant to and in full compliance with the Constitution
and laws of the State of Arkansas (the "State "), including particularly Title 14, Chapter
164, Subchapter 4 and Title 14, Chapter 235, Subchapter 2 of the Arkansas Code of
1987 Annotated, and pursuant to Ordinance No. 1387 ( #30 -09) duly adopted on
November 5, 2009 (the "Authorizing Ordinance "), and do not constitute an
indebtedness of the City within any constitutional or statutory limitation. The bonds are
not general obligations of the City, but are special obligations payable on a parity of
security with the City's obligations pursuant to that certain Loan Agreement dated as of
August 1, 2003 by and between the City and the Arkansas Natural Resources
Commission (the "2003 Loan ") and the City's Wastewater Construction Revenue Bonds,
Series 2009B (the "Series 2009B Bonds "), solely from the Net Revenues derived from
the operation of the City's wastewater system (the "System "). An amount of Net
Revenues sufficient to pay the principal of and interest on the bonds, the 2003 Loan
and the Series 2009B Bonds has been duly pledged and set aside into the Series 2009A
Wastewater Refunding Revenue Bond Fund created by the Authorizing Ordinance, the
2003 Loan Fund and the Series 2009B Wastewater Construction Revenue Bond Fund.
Reference is hereby made to the Authorizing Ordinance for a detailed statement of the
terms and conditions upon which the bonds are issued, of the nature and extent of the
security for the bonds, and the rights and obligations of the City, the Trustee and the
registered owners of the bonds. The City has fixed and has covenanted and agreed to
maintain rates for the services of the System which shall be sufficient at all times to
provide for the proper and reasonable expenses of operation and maintenance of the
System, for the payment of the principal of and interest on the bonds, the 2003 Loan,
and the Series 2009B Bonds, including Trustee's fees, as the same become due and
payable, to establish and maintain debt service reserves and to make the required
deposits for the depreciation of the System.
The Series 2009A Bonds shall be subject to extraordinary, optional and
mandatory sinking fund redemption as follows:
1. Optional Redemption. The Bonds are subject to redemption at the option
of the City from funds from any source, in whole at any time or in part on any interest
payment date on and after June 1, 2015, at a redemption price equal to the principal
amount being redeemed plus accrued interest to the redemption date. If fewer than all
of the Bonds shall be called for redemption, the particular maturities of the Bonds to be
redeemed shall be selected by the City in its discretion. If fewer than all of the Bonds
of any one maturity shall be called for redemption, the particular Bonds or portion
thereof to be redeemed from such maturity shall be selected by lot by the Trustee.
2. Extraordinary Redemption. The bonds shall be redeemed from proceeds
of the bonds which are not needed for the purposes intended, in whole or in part, on
any interest payment date, in inverse order of maturity (and by lot within a maturity in
such manner as the Trustee shall determine), at a price equal to the principal amount
being redeemed plus accrued interest to the redemption date.
3. Mandatory Sinking Fund Redemption. To the extent not previously
redeemed, bonds maturing on December 1 in the year 2020 are subject to mandatory
sinking fund redemption by lot in such manner as the Trustee shall determine, on
December 1 in the years and in the amounts set forth below, at a redemption price
843646•v1
ORDINANCE NO. 1387 (*30 — 09)
Page 9 000009
equal to the principal amount being redeemed plus accrued interest to the date of
redemption:
Series 2009A Bonds Maturing December 1, 2020
Years Principal Amount
2010 $ 285,000
2011 300,000
2012 315,000
2013 330,000
2014 350,000
2015 365,000
2016 385,000
2017 405,000
2018 425,000
2019 445,000
2020 (Maturity) 365,000
The provisions for mandatory sinking fund redemption of the bonds are subject
to the provisions of the Authorizing Ordinance which permit the City to receive credit for
bonds previously redeemed or for bonds acquired by the City and surrendered to the
Trustee.
In case any outstanding bond is in a denomination greater than Five Thousand
Dollars ($5,000.00), each Five Thousand Dollars ($5,000.00) of face value of such bond
shall be treated as a separate bond of the denomination of Five Thousand Dollars
($5,000.00).
Notice of redemption identifying the bonds or portions thereof (which shall be
Five Thousand Dollars ($5,000.00) or a multiple thereof) to be redeemed shall be given
by the Trustee, not less than Thirty (30) nor more than Sixty (60) days prior to the date
fixed for redemption, by mailing a copy of the redemption notice by first class mail,
postage prepaid, to all registered owners of bonds to be redeemed. Failure to mail an
appropriate notice or any such notice to one or more registered owners of bonds to be
redeemed shall not affect the validity of the proceedings for redemption of other bonds
as to which notice of redemption is duly given in proper and timely fashion. All such
bonds or portions thereof thus called for redemption and for the retirement of which
funds are duly provided in accordance with the Authorizing Ordinance prior to the date
fixed for redemption will cease to bear interest on such redemption date.
This bond is transferable by the registered owner hereof in person or by his
attorney -in -fact duly authorized in writing at the principal corporate trust office of the
Trustee, but only in the manner, subject to the limitations and upon payment of the
charges provided in the Authorizing Ordinance, and upon surrender and cancellation of
this bond. Upon such transfer a new fully registered bond or bonds of the same
maturity, of authorized denomination or denominations, for the same aggregate
principal amount, will be issued to the transferee in exchange therefor. This bond is
issued with the intent that the laws of the State shall govern its construction.
No charge shall be made to the owner of any bond for the privilege of
registration, but any owner requesting any such registration shall pay any tax or
governmental charge required to be paid with respect thereto. Except as otherwise
provided in the immediately preceding sentence, the cost of preparing each new Bond
upon each exchange or transfer and any other expenses of the City or the Trustee
incurred in connection therewith shall be paid by the City, .neither the City nor the
Trustee shall be required to transfer or exchange any bond selected for redemption in
whole or in part.
843646 -v1
ORDINANCE NO. 1387 ( #30 - 09)
Page 10 000010
The City and the Trustee may deem and treat the registered owner hereof as the
absolute owner hereof for the purpose of receiving payment of or on account of
principal hereof and premium, if any, hereon and interest due hereon and for all other
purposes, and neither the City nor the Trustee shall be affected by any notice to the
contrary.
The bonds are issuable only as fully registered bonds in the denomination of Five
Thousand Dollars ($5,000.00) and any integral multiple thereof. Subject to the
limitations and upon payment of the charges provided in the Authorizing ordinance,
fully registered bonds may be exchanged for a like aggregate principal amount of fully
registered bonds of the same maturity of other authorized denominations.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions and
things required to exist, happen and be performed precedent to and in the issuance of
the bonds do exist, have happened and have been performed in due time, form and
manner as required by law; that the indebtedness represented by the bonds, together
with all obligations of the City, does not exceed any constitutional or statutory
limitation; and that the above referred to revenues pledged to the payment of the
principal of and premium, if any, and interest on the bonds as the same become due
and payable will be sufficient in amount for that purpose.
This bond shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Authorizing Ordinance until the Certificate of
Authentication hereon shall have been signed by the Trustee.
843646 -v1
ORDINANCE NO.1387 (#`30 — 09)
Page 11 00001
IN WITNESS WHEREOF, the City of Jacksonville, Arkansas has caused this bond
to be executed by its Mayor and City Clerk/Treasurer and its corporate seal to be
impressed or imprinted on this bond, all as of the Dated Date shown above.
100 CITY0 - KSONVILLE, • KANSAS
ATTEST:
•
I tcher ayor
vitt, City • erk
IC I
843646 -v1
ORDINANCE NO, 1387 ( #30 — 09)
Page 12 000012
(Form of Trustee's Certificate)
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds designated Wastewater Refunding Revenue Bonds,
Series 2009A in and issued under the provisions of the within mentioned Authorizing
Ordinance.
Date of Authentication:
BANK OF THE OZARKS
Little Rock, Arkansas, Trustee
By
Authorized Signature
843646 -v1
•
ORDINANCE NO. 1387 ( #30 — 09)
Page 13 000013
(Form of Assignment)
ASSIGNMENT
FOR VALUE RECEIVED, ("Transferor"),
hereby sells, assigns and transfers unto , the within
bond and all rights thereunder, and hereby irrevocably constitutes and appoints
as attorney to transfer the within bond on the books kept
for registration thereof with full power of substitution in the premises.
DATE:
Transferor
GUARANTEED BY:
NOTICE: Signature(s) must be guaranteed by a member of or participant in the
Securities Transfer Agents Medallion Program (STAMP), or in another signature
guaranty program recognized by the Trustee.
843646 -v1
•
ORDINANCE NO. 1387 (#30 — 09)
Page 14 000014
(Form of Series 2009B Bond)
REGISTERED REGISTERED
No. RB -
UNITED STATES OF AMERICA •
STATE OF ARKANSAS
COUNTY OF PULASKI
CITY OF JACKSONVILLE
WASTEWATER CONSTRUCTION
REVENUE BONDS, SERIES 2009B
(Non -AMT)
Maturity Date: Interest Rate:
Dated Date: December 1, 2009 CUSIP No.:
Registered Owner: Cede & Co.
Principal Amount:
KNOW ALL MEN BY THESE PRESENTS:
That the City of Jacksonville, County of Pulaski, State of Arkansas (the "City"),
for value received, hereby promises to pay, but solely from the source as hereinafter
provided and not otherwise, to the Registered Owner shown above upon the
presentation and surrender hereof at the principal corporate office of Bank of the
Ozarks, Little Rock, Arkansas, or its successor or successors, as Trustee and Paying
Agent (the 'Trustee "), on the Maturity Date shown above, the Principal Amount shown
above, in such coin or currency of the United States of America as at the time of
payment shall be legal tender for the payment of public and private debts and to pay by
check or draft interest thereon, but solely from the source as hereinafter provided and
not otherwise, in like coin or currency from the interest commencement date specified
below at the Interest Rate per annum shown above, payable June 1, 2010, and
semiannually thereafter on the first days of June 1 and December 1 of each year, until
payment of such Principal Amount or, if this bond or a portion thereof shall be duly
called for redemption, until the date fixed for redemption, and to pay interest on
overdue principal and interest (to the extent legally enforceable) at the rate borne by
this bond. Payment of each installment of interest shall be made to the person in
whose name this bond is registered on the registration books of the City maintained by
the Trustee at the close of business on the fifteenth day of the month (whether or not a
business day) next preceding each interest payment date (the "Record Date "),
irrespective of any transfer or exchange of this bond subsequent to such Record Date
and prior to such interest payment date.
Unless this bond is presented by an authorized representative of The Depository
Trust Company, a New York corporation ( "DTC "), to the Trustee for registration of
transfer, exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or in such other name as is requested by an authorized representative of
DTC (and any payment is made to Cede & Co. or to such other entity as is required by
an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch
as the registered owner hereof, Cede & Co., has an interest herein.
This bond shall bear interest from the payment date next preceding the date on
which it is authenticated unless it is authenticated on an interest payment date, in
which event it shall bear interest from such date, or unless it is authenticated prior to
the first interest payment date, in which event it shall bear interest from the Dated Date
shown above, or unless it is authenticated during the period from the Record Date to
the next authenticated payment date, in which case it shall bear interest from such
interest payment date, or unless at the time of authentication hereof interest is in
default hereon, in which event it shall bear interest from the date to which interest has
been paid.
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 15 000015
This bond is one of an issue of City of Jacksonville, Arkansas Wastewater
Construction Revenue Bonds, Series 2009B, aggregating Fourteen Million Three
Hundred Thirty Thousand Dollars ($14,300,000) in principal amount (the "bonds "), and
is issued for the purposes of financing all or a portion of the costs of the acquisition,
construction, and equipping by the City of betterments and improvements to the City's
wastewater system (the "System "), funding a debt service reserve, and paying
expenses incidental thereto and to the authorization and issuance of the 2009B Bonds.
The bonds are issued pursuant to and in full compliance with the Constitution
and laws of the State of Arkansas (the "State "), including particularly Title 14, Chapter
164, Subchapter 4 and Title 14, Chapter 235, Subchapter 2 of the Arkansas Code of
1987 Annotated, and pursuant to Ordinance No. 1387 ( #30 -09) duly adopted on
November 5, 2009 (the "Authorizing Ordinance "), and do not constitute an
indebtedness of the City within any constitutional or statutory limitation. The bonds are
not general obligations of the City, but are special obligations payable on a parity of
security with the City's obligations pursuant to that certain Loan Agreement dated as of
August 1, 2003, by and between the City and the Arkansas Natural Resources
Commission (the "2003 Loan ") and the City's Wastewater Refunding Revenue Bonds,
Series 2009A (the "Series 2009A Bonds "), solely from the Net Revenues derived from
the operation of the City's wastewater system (the "System "). An amount of Net
Revenues sufficient to pay the principal of and interest on the bonds, the 2003 Loan
and the Series 2009A Bonds has been duly pledged and set aside into the Series 2009B
Wastewater Construction Revenue Bond Fund created by the Authorizing Ordinance,
the 2003 Loan Fund and the Series 2009B Wastewater Refunding Revenue Bond Fund.
Reference is hereby made to the Authorizing Ordinance for a detailed statement of the
terms and conditions upon which the bonds are issued, of the nature and extent of the
security for the bonds, and the rights and obligations of the City, the Trustee and the
registered owners of the bonds. The City has fixed and has covenanted and agreed to
maintain rates for the services of the System which shall be sufficient at all times to
provide for the proper and reasonable expenses of operation and maintenance of the
System, for the payment of the principal of and interest on the bonds, the 2003 Loan
Series 2009A Bonds, including Trustee's fees, as the same become due and payable, to
establish and maintain debt service reserves and to make the required deposits for the
depreciation of the System.
The bonds shall be subject to extraordinary, optional and mandatory sinking fund
redemption as follows:
1. Extraordinary Redemption. The bonds shall be redeemed from proceeds
of the bonds which are not needed for the purposes intended, in whole or in part, on
any interest payment date, in inverse order of maturity (and by lot within a maturity in
such manner as the Trustee shall determine), at a price equal to the principal amount
being redeemed plus accrued interest to the redemption date.
2. Optional Redemption. The Bonds are subject to redemption at the option
of the City from funds from any source, in whole at any time or in part on any interest
payment date on and after June 1, 2015, at a redemption price equal to the principal
amount being redeemed plus accrued interest to the redemption date. If fewer than all
of the Bonds shall be called for redemption, the particular maturities of the Bonds to be
redeemed shall be selected by the City in its discretion. If fewer than all of the Bonds
of any one maturity shall be called for redemption, the particular Bonds or portion
thereof to be redeemed from such maturity shall be selected by lot by the Trustee.
3. Mandatory Sinking Fund Redemption. To the extent not previously
redeemed, the bonds maturing on December 1 in the years 2034 and 2039 are subject
to mandatory sinking fund redemption by lot in such manner as the Trustee shall
determine, on December 1 in the years and in the amounts set forth below, at a
843646 -v1
•
ORDINANCE NO. 1387 (#30 - 09)
Page 16 000016
redemption price equal to the principal amount being redeemed plus accrued interest to
the date of redemption:
Series 2009E Bonds Maturing December 1, 2034
Years Principal Amounts
2030 $ 715,000
2031 755,000
2032 790,000
2033 830,000
2034 (Maturity) 870,000
Series 2009B Bonds Maturing December 1, 2039
Years Principal Amounts
2035 $ 915,000
2036 960,000
2037 1,010,000
2038 1,060,000
2039 (Maturity) 1,110,000
The provisions for mandatory sinking fund redemption of the bonds are subject
to the provisions of the Authorizing Ordinance which permit the City to receive credit for
bonds previously redeemed or for bonds acquired by the City and surrendered to the
Trustee.
In case any outstanding bond is in a denomination greater than Five Thousand
Dollars ($5,000.00), each Five Thousand Dollars ($5,000.00) of face value of such bond
shall be treated as a separate bond of the denomination of Five Thousand Dollars
($5,000.00).
Notice of redemption identifying the bonds or portions thereof (which shall be
Five Thousand Dollars ($5,000.00) or a multiple thereof) to be redeemed shall be given
by the Trustee, not less than Thirty (30) nor more than Sixty (60) days prior to the date
fixed for redemption, by mailing a copy of the redemption notice by first class mail,
postage prepaid, to all registered owners of bonds to be redeemed. Failure to mail an
appropriate notice or any such notice to one or more registered owners of bonds to be
redeemed shall not affect the validity of the proceedings for redemption of other bonds
as to which notice of redemption is duly given in proper and timely fashion. All such
bonds or portions thereof thus called for redemption and for the retirement of which
funds are duly provided in accordance with the Authorizing Ordinance prior to the date
fixed for redemption will cease to bear interest on such redemption date.
This bond is transferable by the registered owner hereof in person or by his
attorney -in -fact duly authorized in writing at the principal corporate trust office of the
Trustee, but only in the manner, subject to the limitations and upon payment of the
charges provided in the Authorizing Ordinance, and upon surrender and cancellation of
this bond. Upon such transfer a new fully registered bond or bonds of the same
maturity, of authorized denomination or denominations, for the same aggregate
principal amount, will be issued to the transferee in exchange therefor. This bond is
issued with the intent that the laws of the State shall govern its construction.
No charge shall be made to the owner of any bond for the privilege of
registration, but any owner requesting any such registration shall pay any tax or
governmental charge required to be paid with respect thereto. Except as otherwise
provided in the immediately preceding sentence, the cost of preparing each new Bond
upon each exchange or transfer and any other expenses of the City or the Trustee
incurred in connection therewith shall be paid by the City, Neither the City nor the
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 17 00001.7
Trustee shall be required to transfer or exchange any bond selected for redemption in
whole or in part.
The City and the Trustee may deem and treat the registered owner hereof as the
absolute owner hereof for the purpose of receiving payment of or on account of
principal hereof and premium, if any, hereon and interest due hereon and for all other
and neither a d Welt er the City nor the Trustee shall be affected by any notice to the
contrary.
The bonds are issuable only as fully registered bonds in the denomination of
$5,000, and any integral multiple thereof. Subject to the limitations and upon payment
of the charges provided in the Authorizing ordinance, fully registered bonds may be
exchanged for a like aggregate principal amount of fully registered bonds of the same
maturity of other authorized denominations.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to exist, happen and be performed precedent to and in the issuance of
the bonds do exist, have happened and have been performed in due time, form and
manner as required by law; that the indebtedness represented by the bonds, together
with all obligations of the City, does not exceed any constitutional or statutory
limitation; and that the above referred to revenues pledged to the payment of the
principal of and premium, if any, and interest on the bonds as the same become due
and payable will be sufficient in amount for that purpose.
This bond shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Authorizing Ordinance until the Certificate of
Authentication hereon shall have been signed by the Trustee.
THE CITY HAS DESIGNATED THIS BOND AS A "QUALIFIED TAX - EXEMPT
OBLIGATION" WITHIN THE MEANING OF SECTION 265 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
IN WITNESS WHEREOF, the City of Jacksonville, Arkansas has caused this bond
to be executed by its Mayor and City Clerk/Treasurer and its corporate seal to be
impressed or imprinted on this bond, all as of the Dated Date shown above.
C i • F JACKSONVILLE, ARKANSAS
ATTEST: .
bell • to -.7 Gar le' her . or
Susan Da ' , City • - k
(SEAL
843646 -v1
ORDINANCE N0. 1387 ( #30 — 09)
Page 18 000018
(Form of Trustee's Certificate)
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This bond is one of the bonds designated Wastewater Construction Revenue
Bonds, Series 2009B in and issued under the provisions of the within mentioned
Authorizing Ordinance.
Date of Authentication:
BANK OF THE OZARKS
Little Rock, Arkansas, Trustee
By
Authorized Signature
843646 -v1
ORDINANCE NO. 1387 ( #30 - 09)
Page 19 000019
(Form of Assignment)
ASSIGNMENT
FOR VALUE RECEIVED, ("Transferor"),
hereby sells, assigns and transfers unto , the within
bond and all rights thereunder, and hereby irrevocably constitutes and appoints
as attorney to transfer the within bond on the books kept
for registration thereof with full power of substitution in the premises.
DATE:
Transferor
GUARANTEED BY:
NOTICE: Signature(s) must be guaranteed by a member of or participant in the
Securities Transfer Agents Medallion Program (STAMP), or in another signature
guaranty program recognized by the Trustee.
843646 -v1
•
•
ORDINANCE NO, 1387 (#30 — 09)
Page 20 0030020
SECTION NINE. The rates charged for services of the System heretofore fixed
by ordinances of the City and the conditions, rights and obligations pertaining thereto,
as set out in those Ordinances, are hereby ratified, confirmed and continued. None of
the facilities or services afforded by the System shall be furnished without a charge
being made therefor. In the event that the City or any department, agency, or
instrumentality thereof shall avail itself of the facilities and services afforded by the
System, the reasonable value of the service or facilities so afforded shall be charged
against the City or such department, agency, or instrumentality and shall be paid for as
the charges accrue. The revenues so received shall be deemed to be revenues derived
from the operation of the System and shall be used and accounted for in the same
manner as the other revenues derived from the operation of the System.
The City covenants that the rates established will produce System Revenues at
least sufficient to pay principal of and interest on all outstanding bonds and other debt
obligations to which System Revenues are pledged ("System Bonds "), maintain debt
service reserves at the required levels, provide the amount required to be set aside for
the Depreciation Fund (described below), and pay the expenses of operation and
maintenance of the System, including all expense items properly attributable to
operation and maintenance under generally accepted accounting principles applicable to
municipal wastewater facilities (other than depreciation, interest and amortization of
deferred bond discount expenses). The City further covenants that the rates shall, if
and when necessary from time to time, be increased in such manner as will produce
System Revenues at least sufficient to comply with the previous sentence.
The City covenants and agrees that the rates shall never be reduced while any of
the bonds are outstanding unless there is obtained from an independent certified public
accountant ( "Accountant ") a certificate that the Net Revenues of the System ( "Net
Revenues" being defined as gross Revenues less the expenses of operation and
maintenance of the System, including all expense items properly attributable to the
operation and maintenance of the System under generally accepted accounting
principles applicable to municipal sewer facilities, excluding depreciation, interest and
amortization of deferred bond discount expenses), with the reduced rates, will always
be equal to the amount required to be set aside for the Depreciation Fund (hereinafter
identified), and leave a balance equal to at least One Hundred Twenty-five Percent
(125 %) of the average annual principal and interest requirements on all outstanding
bonds payable from Revenues ( "System Bonds "). The City further covenants and agrees
that the rates shall, if and when necessary, from time to time, be increased in such
manner as will produce Revenues at least sufficient to pay the principal and interest on
all System Bonds when due, to pay the operation and maintenance expenses of the
System, and to deposit the amounts required to be paid into the Depreciation Fund and
the Debt Service Reserve in accordance herewith.
SECTION TEN. The System shall be continuously operated as a revenue
producing undertaking and all Revenues shall be paid into a special fund heretofore
created and designated "Wastewater Fund" (the "Revenue Fund "). The Revenues so
deposited in the Revenue Fund are hereby pledged and shall be applied to the payment
of the reasonable and necessary expenses of operation, repair and maintenance of the
System, to the payment of the principal of and premium, if any, and interest on System
Bonds, to the establishment and maintenance of a Debt Service Reserve, and to the
providing of a Depreciation Fund, as hereafter set forth. The Revenue Fund, and the
other special funds hereafter in this Ordinance provided for or referred to, shall be
maintained in such depositories of the City as shall from time to time be designated by
the Commission, with all such depositories to hold membership in the Federal Deposit
Insurance Corporation (the "FDIC "), to be located in Pulaski County, Arkansas, and to
have a capital and surplus of not less than Fifteen Million Dollars ($15,000,000.00), and
with all deposits in any depository in excess of the amount insured by the FDIC to be
843646 -v1
ORDINANCE NO, 1387 ( #30 — 09)
Page 21 000071
secured by bonds or other direct or fully guaranteed obligations of the United States of
America unless invested in accordance with Section 26 hereof.
SECTION ELEVEN. There shall be paid from the Revenue Fund into a fund
heretofore created and designated "Wastewater Operation and Maintenance Fund" (the
"Operation and Maintenance Fund ") on or before the tenth day of each month while
any bonds are outstanding, an amount sufficient to pay the reasonable and necessary
monthly expenses of operation, repair and maintenance of the System for such month
and from which disbursements shall be made only for those purposes. Fixed annual
charges such as insurance premiums and the cost of major repair and maintenance
expenses may be computed and set up on an annual basis, and One - twelfth (1/12) of
the amount thereof may be paid into the Operation and Maintenance Fund each month.
If in any month for any reason there shall be a failure to transfer and pay the
required amount into Operation and Maintenance Fund, the amount of any deficiency
shall be added to the amount otherwise required to be transferred and paid into such
fund in the next succeeding month. If in any fiscal year a surplus shall be accumulated
in the Operation and Maintenance Fund over and above the amount which shall be
necessary to defray the reasonable and necessary cost of operation, repair and
maintenance of the System during the remainder of the then current fiscal year and the
next ensuing fiscal year, such surplus may be transferred and deposited in the Revenue
Fund.
SECTION TWELVE. (a) After making the required monthly deposits into the
Operation and Maintenance Fund, there shall be paid from the Revenue Fund, pro rata,
the required monthly deposits into the 2003 Loan Fund being maintained in connection
with the 2003 Loan and into two special funds in the name of the City which are hereby
created and designated the "Series 2009A Wastewater Refunding Revenue Bond Fund"
and the "Series 2009B Wastewater Construction Revenue Bond Fund," respectively
(together, the "Bond Funds ") on or before the Fifteenth day of each month,
commencing in January, 2010, until all outstanding bonds, with interest thereon, have
been paid in full or provision made for such payment a sum equal to One -sixth (1 /6th)
of the next installment of interest due on the bonds and One - twelfth (1 /12th) of the
next installment of principal due on the bonds.
The City shall also pay into the 2003 Loan Fund and the Bond Funds such
additional sums as necessary to provide for the Trustee's fees and expenses and any
arbitrage rebate due the United States Treasury under Section 148(f) of the Intemal
Revenue Code of 1986, as amended (the "Code "). The City shall realize a credit against
monthly deposits into the 2003 Loan Fund and the Bond Funds from bond proceeds
deposited therein, all interest earnings on moneys in the 2003 Loan Fund and the Bond
Funds and all transfers made from the Debt Service Reserve during the preceding
month.
There is hereby created, as a part of the Bond Funds, a Debt Service Reserve
which shall be maintained by the City in an amount equal to the lesser of: (a) Fifty
Percent (50 %) of the maximum annual principal and interest requirements on the
Series 2009A Bonds and the Series 2009B Bonds, or (b) ten Percent (10 %) of the
aggregate proceeds of the Series 2009A Bonds and the Series 2009B Bonds (the
"Required Level "). Should the Debt Service Reserve become impaired or be reduced
below the Required Level, the City shall make additional monthly payments from the
Revenue Fund until the impairment or reduction is corrected within a twelve month
period.
If for any reason the City should fail at any time to make any of the required
payments into the Bond Funds, any sums then held in the Debt Service Reserve shall be
used to the extent necessary for the payment of principal of or interest on the bonds,
but the Debt Service Reserve shall be reimbursed from the Revenue Fund before any
moneys in the Revenue Fund shall be used for any other purpose other than the
843646•v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 22 00004;2
making of payments required to be made into the Operation and Maintenance Fund and
the Bond Funds. The Debt Service Reserve shall be used solely as provided herein.
If System Revenues are insufficient to make the required payment on the first
business day of the following month into the Bond Funds, the amount of any such
deficiency in the payment made shall be added to the amount otherwise required to be
paid into the Bond Funds on the first business day of the next month.
When the moneys held in the Bond Funds shall be and remain sufficient to pay
the principal of and interest on all of the bonds then outstanding plus Trustee's fees
and any arbitrage rebate due as provided above, the City shall not be obligated to make
any further payments into the Bond Funds.
It shall be the duty of the City to cause to be withdrawn from the Bond Funds
and deposited with the Trustee at least One (1) business day before the due date of
any principal and /or interest on any bond, at maturity or redemption prior to maturity,
and deposited with the Trustee an amount equal to the amount of such bond and
interest due thereon for the sole purpose of paying the same, together with the
Trustee's fee. There shall also be withdrawn and paid to the United States Treasury
any arbitrage rebate due at the times and in the amounts required by Section 148(f) of
the Code. No withdrawal of funds from the Bond Funds shall be made for any other
purpose except as otherwise authorized in this Ordinance.
The bonds shall be specifically secured by a pledge of all Net Revenues. The
bonds are being issued on a parity of security with the 2003 Loan. This pledge in favor
of the bonds is hereby irrevocably made according to the terms of this Ordinance, and
the City and its officers and employees shall execute, perform and carry out the terms
thereof in strict conformity with the provisions of this Ordinance.
SECTION THIRTEEN. After making the required payments into the Operation
and Maintenance Fund, the Bond Funds and the 2003 Loan Fund, there shall be paid
from the Revenue Fund into a fund heretofore created and designated the "Wastewater
Depreciation Fund" (the "Depreciation Fund ") on or before the 15th day of each month
while any bonds are outstanding, three percent (3 %) of the Revenues which remain
after the required payment into the Operation and Maintenance Fund has been made.
The moneys in the Depreciation Fund shall be used solely for the purpose of paying the
cost of replacements made necessary by the depreciation of the System. If in any fiscal
year a surplus shall be accumulated in the Depreciation Fund over and above the
amount necessary to defray the cost of the probable replacements during the then
current fiscal year and the next ensuing fiscal year, such surplus may be transferred
and paid into the Revenue Fund.
SECTION FOURTEEN. Any surplus in the Revenue Fund, after making the
required monthly deposits into the other funds as set forth above, may be used, at the
option of the City, for any lawful purpose of the System, as approved by the
Commission.
SECTION FIFTEEN. So long as any of the bonds are outstanding, the City shall
not issue or attempt to issue any bonds claimed to be entitled to a priority of lien on
Revenues over the lien securing the Bonds and the 2003 Loan. The City reserves the
right to issue additional bonds to finance or pay the cost of making any future
extensions, betterments or improvements to the System, or to refund bonds issued for
such purposes, but the City shall not authorize or issue any such additional bonds
ranking on a parity with the Bonds and the 2003 Loan unless and until there has been
procured and filed with the City Clerk and the Trustee a statement by an independent
certified public accountant not in the regular employ of the City (the "Accountant ")
reciting the opinion, based upon necessary investigation, that either: (1) Net Revenues
of the System for the fiscal year immediately preceding the fiscal year in which it is
proposed to issue such additional bonds were not less than One Hundred Twenty
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 23 000023
Percent (120 %) of the average annual principal and interest requirements on all the
then outstanding System Bonds and the additional parity bonds then proposed to be
issued; or, (2) Net Revenues of the System for the ensuing fiscal year, including any
increase in revenues attributable to the proposed extensions, betterments and
improvements as reflected by the written opinion of a duly qualified consulting engineer
not in the regular employ of the City and including any additional revenues expected to
be received as a result of a rate increase effective during such year or the prior fiscal
year, shall be equal to not less than One Hundred Twenty Percent (120 %) of the
average annual principal and interest requirements on all the then outstanding System
Bonds and the additional parity bonds then proposed to be issued.
For the purposes of the computation required by (1) above, additional amounts
may be added to the Net Revenues of the completed fiscal year immediately preceding
the issuance of the additional bonds, as follows: if, prior to the issuance of the
additional bonds, and subsequent to the first day of such preceding fiscal year, the City
shall have increased its rates or charges imposed for services of the System there may
be added to the Net Revenues of such fiscal year the additional Net Revenues which
would have been received from the operations of the System during such fiscal year
had such increase been in effect throughout such fiscal year.
Notwithstanding satisfaction of the other conditions to the issuance of additional
bonds as set forth in this Section, no issuance may occur if a default or breach (or any
event which, once all notice or grace periods have passed, would constitute a breach)
exists unless such breach shall be cured upon such issuance.
The term "Net Revenues" as used in this section, means gross System Revenues
less operation and maintenance expenses (other than depreciation, interest and
amortization of deferred bond discount expenses of the System), determined in
accordance with generally accepted accounting principles applicable to municipal
wastewater facilities.
SECTION SIXTEEN. The City covenants and agrees that it will maintain the
System in good condition and operate the same in an efficient manner and at
reasonable cost. While any of the bonds are outstanding, the City agrees that it will
insure and at all times keep insured, in the amount of the full insurable value thereof, in
a responsible insurance company or companies selected by the Commission and
authorized and qualified under the laws of the State to assume the risk thereof, all
aboveground structures of the System, to the extent that such structures would be
covered by insurance by private companies engaged in similar types of businesses,
against loss or damage thereto from fire, lightning, tornados, winds, riot, strike, civil
commotion, malicious damage, explosion and against any other loss or damage from
any other causes customarily insured against by private companies engaged in similar
types of business. The insurance policies are to carry a clause making them payable to
the Commission and the Trustee as their interests may appear, and satisfactory
evidence of said insurance shall be filed with the Trustee. In the event of loss, the
proceeds of such insurance shall be applied solely toward the reconstruction,
replacement or repair of the System, and in such event the City will, with reasonable
promptness, cause to be commenced and completed the reconstruction, replacement
and repair work. If such proceeds are more than sufficient for such purposes, the
balance remaining shall be deposited to the credit of the Revenue Fund, and if such
proceeds shall be insufficient for such purposes the deficiency shall be supplied first
from moneys in the Depreciation Fund and second from moneys in the Operation and
Maintenance Fund and third from surplus moneys in the Revenue Fund. Nothing shall
be construed as requiring the City to expend any moneys for operation and
maintenance of the System or for premiums on its insurance which are derived from
sources other than the operation of the System, but nothing shall be construed as
preventing the City from doing so.
843646 -v1
ORDINANCE NO. 1387 ( #30 - 09)
Page 24 (�/�
�� ili3i`,A.
SECTION SEVENTEEN. The bonds shall be subject to redemption prior to
maturity in accordance with the terms set out in the respective bond forms for each
series of bonds. The City may acquire bonds by purchase at a price not in excess of
par plus accrued interest, inclusive of brokerage fees, and surrender to the Trustee any
bonds so acquired, in exchange for which the City shall receive a credit under this
Ordinance in an amount equal to the principal amount of the bonds so acquired and
surrendered, for and of the then next date for mandatory sinking fund redemption of
bonds of the same maturity.
SECTION EIGHTEEN. The Commission will keep proper books of accounts and
records (separate from all other records and accounts of the City) in which complete
and correct entries shall be made of all transactions relating to the operation of the
System, and such books shall be available for inspection by the registered owner of any
of the bonds at reasonable times and under reasonable circumstances. The City and
the Commission agree to have these records audited by an Accountant at least once
each year, and a copy of the audit shall be delivered to the Trustee and made available
to interested registered owners requesting the same in writing. In the event that the
City or the Commission fail or refuse to make the audit, the Trustee, or any registered
owner of the Bonds, may have the audit made, and the cost thereof shall be charged
against the Operation and Maintenance Fund.
SECTION NINETEEN. Any bond shall be deemed to be paid within the
meaning of this Ordinance when payment of the principal of and interest on such bond
(whether at maturity or upon redemption as provided herein, or otherwise), either: (i)
shall have been made or caused to be made in accordance with the terms thereof; or,
(ii) shall have been provided for by irrevocably depositing with the Trustee, in trust and
irrevocably set aside exclusively for such payment, (1) cash fully insured by the FDIC
and /or collateralized sufficient to make such payment and /or, (2) direct obligations of
(including obligations issued or held in book entry form on the books of) the
Department of the Treasury of the United States of America ( "Government Securities ")
(provided that such deposit will not affect the tax exempt status of the interest on any
of the bonds or cause any of the bonds to be classified as "arbitrage bonds" within the
meaning of Section 148 of the Code), maturing as to principal and interest in such
amounts and at such times as will provide sufficient moneys to make such payment,
and all necessary and proper fees, compensation and expenses of the Trustee shall
have been paid or the payment thereof provided for to the satisfaction of the Trustee.
On the payment of any such bonds within the meaning of this Ordinance, the
Trustee shall hold in trust, for the benefit of the owners of such bonds, all such moneys
and /or Government Securities.
When all the bonds shall have been paid within the meaning of this Ordinance, if
the Trustee has been paid its fees and expenses and if any arbitrage rebate due the
United States Treasury has been paid or provided for to the satisfaction of the Trustee,
the Trustee shall take all appropriate action to cause: (i) the pledge and lien of this
Ordinance to be discharged and cancelled; and, (ii) all moneys held by it pursuant to
this Ordinance and which are not required for the payment of such bonds to be paid
over or delivered to or at the direction of the City. In determining the sufficiency of the
deposit of Government Securities there shall be considered the principal amount of such
Government Securities and interest to be earned thereon until the maturity of such
Government Securities.
SECTION TWENTY. (a) If there be any default in the payment of the principal
of or interest on any of the bonds, or if the City defaults in any Bond Fund requirement
or in the performance of any of the other covenants contained in this Ordinance and
such failure continues unremedied for thirty (30) days, or if the City declares
bankruptcy or seeks relief from its creditors under the provisions of any other similar
state or federal law, the Trustee may, and upon the written request of the registered
owners of not less than Ten Percent (10 %) in principal amount of the then outstanding
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 25 000025
bonds, shall, by proper suit, compel the performance of the duties of the officials of the
City under the laws of Arkansas. And in the case of a default in the payment of the
principal of and interest on any of the bonds, the Trustee may and upon written request
of the registered owners of not less than Ten Percent (10 %) in principal amount of the
then outstanding bonds, shall apply in a proper action to a court of competent
jurisdiction for the appointment of a receiver to administer the System on behalf of the
City and the registered owners of the bonds with power to charge and collect (or by
mandatory injunction or otherwise to cause to be charged and collected) rates sufficient
to provide for the payment of the expenses of operation, maintenance and repair and
to pay any bonds and interest outstanding and to apply the System Revenues in
conformity with the laws of Arkansas and with this Ordinance. When all defaults in
principal and interest payments have been cured, the custody and operation of the
System shall revert to the City.
(b) No registered owner of any of the outstanding bonds shall have any
right to institute any suit, action, mandamus or other proceeding in equity or at law for
the protection or enforcement of any power or right unless such owner previously shall
have given to the Trustee written notice of the default on account of which such suit,
action or proceeding is to be taken, and unless the registered owners of not Tess than
Ten Percent (10 %) in principal amount of the bonds then outstanding shall have made
written request of the Trustee after the right to exercise such power or right of action,
as the case may be, shall have accrued, and shall have afforded the Trustee a
reasonable opportunity either to proceed to exercise the powers granted to the Trustee,
or to institute such action, suit or proceeding in its name, and unless, also, there shall
have been offered to the Trustee reasonable security and indemnity against the costs,
expenses and liabilities to be incurred therein or thereby and the
Trustee shall have refused or neglected to comply with such request within a
reasonable time.
Such notification, request and offer of indemnity are, at the option of the Trustee,
conditions precedent to the execution of any remedy. No one or more registered
owners of the bonds shall have any right in any manner whatever by his or their action
to affect, disturb or prejudice the security of this Ordinance, or to enforce any right
thereunder except the manner herein described. All proceedings at law or in equity
shall be instituted, had and maintained in the manner herein described and for the
benefit of all registered owners of the outstanding bonds.
(c) No remedy conferred upon or reserved to the Trustee or to the
registered owners of the bonds is intended to be exclusive of any other remedy or
remedies, and every such remedy shall be cumulative and shall be in addition to every
other remedy given under this Ordinance or given by any law or by the Constitution of
the State of Arkansas.
(d) The Trustee may, and upon the written request of the registered
owners of not less than a majority in principal amount of the bonds then outstanding
shall, waive any default which shall have been remedied before the entry of final
judgment or decree in any suit, action or proceeding instituted under the provisions of
this Ordinance or before the completion of the enforcement of any other remedy, but
no such waiver shall extend to or affect any other existing or any subsequent default or
defaults or impair any rights or remedies consequent thereon.
(e) All rights of action under this Ordinance or under any of the
bonds, enforceable by the Trustee, may be enforced by it without the possession of any
of the bonds, and any such suit, action or proceeding instituted by the Trustee shall be
brought in its name for the benefit of all the registered owners of such bonds, subject
to the provisions of this Ordinance.
843646 -vi
ORDINANCE NO. 1387 ( #30 — 09)
Page 26
(f) No delay or omission of the Trustee or of any registered owners
of the bonds to exercise any right or power accrued upon any default shall impair any
such right or power or shall be construed to be a waiver of any such default or an
acquiescence therein; and every power and remedy given by this ordinance to the
Trustee and to the registered owners of the bonds, respectively, may be exercised from
time to time and as often as may be deemed expedient.
(g) After payment of reasonable expenses of the Trustee, the
application of funds realized upon default shall be applied to the payment of expenses
of the City or arbitrage rebate only after payment of past due and current debt service
on the bonds and amounts required to restore the Debt Service Reserve to the
Required Level.
SECTION TWENTY - ONE. (a) The terms of this Ordinance shall constitute a
contract between the City and the registered owners of the bonds and no variation or
change in the undertaking herein set forth shall be made while any of these bonds are
outstanding, except as hereinafter set forth in subsections (b) and (c).
(b) The Trustee, may consent to any variation or change in this
Ordinance without the consent of the owners of the outstanding bonds: (a) in
connection with the issuance of additional parity bonds under this Ordinance; (b) in
order to cure any ambiguity, defect or omission herein or to correct or supplement any
defective or inconsistent provisions contained herein as the City may deem necessary or
desirable and not inconsistent herewith; or, (c) in order to make any other variation or
change which the Trustee determines shall not adversely affect the interests of the
owners of the bonds.
(c) The owners of not less than Seventy-five Percent (75 %) in
aggregate principal amount of the bonds then outstanding shall have the right, from
time to time, anything contained in this ordinance to the contrary notwithstanding to
consent to and approve the adoption by the City of such ordinance supplemental hereto
as shall be necessary or desirable for the purpose of modifying, altering, amending,
adding to or rescinding, in any particular, any of the terms or provisions contained in
this ordinance or in any supplemental ordinance; provided, however, that nothing
contained in this Section shall permit or be construed as permitting: (a) an extension of
the maturity of the principal of or the interest on any bond; (b) a reduction in the
principal amount of any bond or the rate of interest thereon; (c) the creation of a lien
or pledge superior to the lien and pledge created by this Ordinance; (d) a privilege or
priority of any bond or bonds over any other bond or bonds; or, (e) a reduction in the
aggregate principal amount of the bonds required for consent to such supplemental
ordinance.
SECTION TWENTY - TWO. When the bonds have been executed and sealed as
herein provided, they shall be authenticated by the Trustee, and the Trustee shall
deliver the bonds to the Purchaser upon payment in cash of the Purchase Price. The
accrued interest shall be remitted to the City for deposit into the Bond Funds. The
expenses of issuing the bonds and accomplishing the refunding as set forth in the
delivery instructions to the Trustee signed by the Mayor and City Clerk/Treasurer shall
also be paid from the Purchase Price (the "Delivery Instructions "). The amount
necessary from the Purchase Price to refund the 2006 Note as set forth in the Delivery
Instructions shall be delivered to the owner and holder of the 2006 Note in full payment
thereof. The remainder of the Purchase Price shall be remitted to the City for deposit
into an account of the City heretofore created and designated "Jacksonville Wastewater
Utility Construction Fund" ( "Construction Fund "). The moneys deposited into the
Construction Fund, including earnings thereon, shall be disbursed in payment of the
costs of accomplishing the improvements and paying necessary expenses incidental
thereto. Disbursements shall be on the basis of checks which shall contain at least the
following information: the person to whom payment is being made; the amount of the
payment; and the purpose by general classification of the payment. Each check must
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 27 000027
be signed by the General Manager or Finance Director of the Jacksonville Wastewater
Utility. The Commission shall be required to keep accurate records of all payments
made on the basis of checks.
When all required expenses paid and expenditures made from the Construction
Fund for and in connection with the accomplishment of the Project and the financing
thereof, this fact shall, if moneys remain in the Construction Fund, be evidenced by a
certificate signed by the Mayor, which certificate shall state, among other things, the
date of the completion of the Project and that all obligations payable from the
Construction Fund have been discharged. A copy of the certificate shall be filed with
the depository or depositories of the Construction Fund, and a copy with the Trustee,
and upon receipt thereof the depository of the Construction Fund shall transfer any
remaining balance to the Bond Fund for the purpose of redeeming the Bonds.
SECTION TWENTY THREE. In the event the office of Mayor, City
Clerk/Treasurer, Commission or City Council shall be abolished, or any two or more of
such offices shall be merged or consolidated, or in the event the duties of a particular
office shall be transferred to another office or officer, or in the event of a vacancy in
any such office by reason of death, resignation, removal from office or otherwise, or in
the event any such officer shall become incapable of performing the duties of his office
by reason of sickness, absence from the City or otherwise, all powers conferred and all
obligations and duties imposed upon such office or officer shall be performed by the
office or officer succeeding to the principal functions thereof, or by the office or officer
upon whom such powers, obligations and duties shall be imposed by law.
So long as the System is under the control of the Commission, performance by
the Commission of any obligation of the City hereunder shall be deemed performance
by the City. The Commission presently consists of Joan Zumwalt, Fred Belote, Jody
Urquhart, Pat Griggs and Barbara Meyers.
SECTION TWENTY - FOUR. (a) The City covenants that it shall not take any
action or suffer or permit any action to be taken or condition to exist which causes or
may cause the interest payable on the Series 20096 Bonds to be included in gross
income for federal income tax purposes. Without limiting the generality of the
foregoing, the City covenants that the proceeds of the sale of the Series 2009B Bonds
and System Revenues will not be used directly or indirectly in such manner as to cause
the Series 2009B Bonds to be treated as "arbitrage bonds" within the meaning of
Section 148 of the Code. The City covenants to pay to the United States Treasury any
arbitrage rebate due under Section 148 of the Code at the times required by Section
148 of the Code.
(b) The City shall assure that: (i) not in excess of Ten Percent (10 %)
of the Net Proceeds of the Series 2009B Bonds is used for Private Business Use if, in
addition, the payment of more than Ten Percent (10 %) of the principal or Ten Percent
(10 %) of the interest due on the Series 2009B Bonds during the term thereof is, under
the terms of the Series 2009B Bonds or any underlying arrangement, directly or
indirectly secured by any interest in property used or to be used for a Private Business
Use or in payments in respect of property used or to be used for a Private Business Use
or is to be derived from payments, whether or not to the City, in respect of property or
borrowed moneys used or to be used for a Private Business Use; and, (ii) in the event
that both (A) in excess of Five Percent (5 %) of the Net Proceeds of the Series 2009B
Bonds are used for a Private Business Use; and, (B) an amount in excess of Five
Percent (5 %) of the principal or Five Percent (5 %) of the interest due on the Series
20096 Bonds during the term thereof is, under the terms of the Series 2009B Bonds or
any underlying arrangement, directly or indirectly, secured by any interest in property
used or to be used for said Private Business Use or in payments in respect of property
used or to be used for said Private Business Use or is to be derived from payments,
whether or not to the City, in respect of property or borrowed money used or to be
used for said Private Business Use, then said excess over said Five Percent (5 %) of Net
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 28 0000%6
Proceeds of the Series 2009B Bonds used for a Private Business Use shall be used for a
Private Business Use related to the governmental use of the improvements or the
improvements financed by the Series 2009B Bonds
The City shall assure that not in excess of Five Percent (5 %) of the Net
Proceeds of the Series 2009E Bonds are used, directly or indirectly, to make or
finance a loan to persons other than state or local governmental units.
As used in this subsection (b), the following terms shall have the following
meanings:
"Net Proceeds" means the face amount of the Series 2009B Bonds, plus
accrued interest and premium, if any, less original issue discount, if any, less any
amounts deposited into the Debt Service Reserve.
"Private Business Use" means use directly or indirectly in a trade or
business carried on by a natural person or in any activity carried on by a person
other than a natural person, excluding, however, use by a state or local
governmental unit and use as a member of the general public.
(c) The City covenants that it will take no action which would cause
the Series 2009B Bonds to be "federally guaranteed" within the meaning of Section
149(b) of the Code. Nothing in this Section shall prohibit investments in bonds issued
by the United States Treasury.
(d) The City covenants that it will submit to the Secretary of the
Treasury of the United States, not later than the Fifteenth (15 day of the second
calendar month after the close of the calendar quarter in which the Series 2009B Bonds
are issued, a statement required by Section 149(e) of the Code.
(e) The City covenants that it will not reimburse itself from proceeds
of the Series 20096 Bonds for costs paid prior to October 1, 2009, the date the City
approved Resolution No. 635 ( #14 -2009) except in compliance with United States
Treasury Regulation No.1.150 -2 (the "Regulation"). Resolution No. 635 ( #14 -2009)
shall constitute an "official intent" for the purpose of the Regulation.
(f) The City covenants that it will, in compliance with the
requirements of Section 148(f) of the Code, pay with moneys in the Series 2009B Bond
Fund to the United States Government in accordance with the requirements of Section
148(f) of the Code, from time to time, an amount equal to the sum of (1) the excess of
(A) the amount earned on all Non - purpose Investments (as therein defined) attributable
to the Series 2009B Bonds, other than investments attributable to such excess over (B)
the amount which would have been earned if such Non - purpose Investments
attributable to the Series 2009B Bonds were invested at a rate equal to the Yield (as
defined in the Code) on the Series 20096 Bonds, plus (2) any income attributable to the
excess described in (1), subject to the exceptions set forth in Section 148 of the Code.
The City further covenants that in order to assure compliance with its covenants herein,
it will employ a qualified consultant to advise the City in making the determination
required to comply with this subsection (f). Anything herein to the contrary
notwithstanding this provision may be modified or rescinded if in the opinion of Bond
Counsel such modification or rescission will not affect the tax- exempt status of the
Series 2009B Bonds for federal income tax purposes.
(g) The City hereby designates the Series 2009B Bonds as "qualified
tax- exempt obligations" within the meaning of the Code. The City represents that the
aggregate principal amount of its qualified tax- exempt obligations (excluding "private
activity bonds" within the meaning of Section 141 of the Code), including those of its
subordinate entities, issued in calendar year 2009 will not exceed Thirty Million Dollars
($30,000,000.00).
843646 -v1
ORDINANCE NO. 1387 (4 — 09)
Page 29 00002
SECTION TWENTY - FIVE. The Trustee shall only be responsible for the
exercise of good faith and reasonable prudence in the execution of its trust. The
recitals in this Ordinance and in the face of the bonds are the recitals of the City and
not of the Trustee. The Trustee shall not be required to take any action as Trustee
unless it shall have been requested to do so in writing by the owners of not less than
Ten Percent (10 %) in principal amount of the bonds then outstanding, and shall have
been offered reasonable security and indemnity against the costs, expenses and
liabilities to be incurred therein or thereby. The Trustee may resign at any time by
Sixty (60) days notice in writing to the City Clerk, to the registered owners of the bonds
and the City or the majority in value of the registered owners of the outstanding bonds
at any time, with or without cause, may remove the Trustee. In the event of a vacancy
in the office of Trustee, either by resignation or by removal, the City shall appoint a
new Trustee, such appointment to be evidenced by a written instrument or instruments
filed with the City Clerk. Every successor Trustee appointed pursuant to this Section
shall be a trust company or bank in good standing, duly authorized to exercise trust
powers, subject to examination by federal or state authority and having a reported
capitalized surplus of not less than Fifteen Million Dollars ($15,000,000.00). The
original Trustee and any successor Trustee shall file a written acceptance and
agreement to execute the trust imposed upon it or them by this Ordinance, but only
upon the terms and conditions set forth in this Ordinance and subject to the provisions
of this Ordinance, to all of which the respective owners of the bonds agree. Such
written acceptance shall be filed with the City Clerk and a copy thereof shall be placed
in the bond transcript. Any successor Trustee shall have all the powers herein granted
to the original Trustee. The Trustee's resignation shall become effective upon the
acceptance of the trusts by the successor Trustee.
SECTION TWENTY - SIX. (a) Moneys held for the credit of all funds created by
this Ordinance may be invested and reinvested in Permitted Investments.
(b) Obligations purchased as an investment of any fund or account
shall be deemed at all times a part of such fund. Any profit or loss realized on
investments of moneys in any fund shall be charged to said fund.
(c) The Trustee shall so invest and reinvest pursuant to the direction of
the City and in the Trustee's discretion in the absence of any direct instructions from
the City.
(d) "Permitted Investments" are defined to mean:
(1) Direct or fully guaranteed obligations of the United States of
America ("Government Securities ");
(2) Obligations guaranteed as a payment of principal and
interest by the United States of America ("Government Guaranteed
Securities ");
(3) Cash (insured at all times by the FDIC or otherwise
collateralized with obligations described in clauses (1) or (2) above;
(4) Time deposits or certificates of deposit of banks, including
the Trustee, which are insured by the FDIC, or if in excess of insurance
coverage, collateralized by Government Securities, Government
Guaranteed Securities or other securities authorized by State law to
secure public funds.
Permitted investments shall mature, or shall be subject to redemption by the holder
thereof, at the option of such holder, not later than (A) the payment date for interest or
principal and interest in the case of the Bond Funds, (B) the date or dates when the
843646 -v1
ORDINANCE NO. 1387 ( #30 — 09)
Page 30 000030
moneys will be needed for the purpose intended in the case of the Construction Fund
and (C) Five (5) years for the Debt Service Reserve. The Trustee shall follow any
investment instructions of the City which are not inconsistent with the foregoing
provisions of this paragraph.
(e) Moneys held for the credit of any other fund shall be continuously
invested and reinvested in Permitted Investments or other investments as may, from
time to time, be permitted by law, which shall mature, or which shall be subject to
redemption by the holder thereof, at the option of such holder, not later than the date
or dates when the moneys held for the credit of the particular fund will be required for
purposes intended.
SECTION TWENTY SEVEN. All moneys, if any, in any 2006 Loan Fund,
including the debt service reserve therein, if any, are hereby appropriated and shall be
used to refund the 2006 Loan and shall be deposited into the Escrow Account, or other
account designated for payment of the 2006 Loan on December 16, 2009, and any
balance shall be deposited into the Series 2009A Bond Fund.
SECTION TWENTY EIGHT. It is covenanted and agreed by the City with the
registered owners of the bonds, or any of them, that the City and the Commission will
faithfully and punctually perform all duties with reference to the System required by the
Constitution and laws of the State, including the charging and collecting of reasonable
and sufficient rates lawfully established for services rendered by the System, the
segregating of Revenues as herein required, and the applying of Revenues to the
respective funds herein created or referred to.
SECTION TWENTY - NINE. The City covenants that it will not sell or lease the
System, or any substantial portion thereof; provided, however, that nothing herein shall
be construed to prohibit the City from making such dispositions of properties of the
System and such replacements and substitutions for properties of the System as shall
be necessary or incidental to the efficient operation of the System as a revenue -
producing undertaking. All revenues derived from such dispositions shall be deposited
into the Revenue Fund. Proceeds of any sale, lease or other disposition of the System
pursuant to this Section that are deposited into the Revenue Fund shall not be offset
from amounts for which the City is obligated to establish rates under Section 9 of this
Ordinance.
SECTION THIRTY. The provisions of this Ordinance are hereby declared to be
separable and if any provision shall for any reason be held illegal or invalid, such
holding shall not affect the validity of the remainder of this Ordinance.
SECTION THIRTY - ONE. All ordinances and resolutions or parts thereof, in
conflict herewith are hereby repealed to the extent of such conflict.
SECTION THIRTY - TWO. It is hereby ascertained and declared that the
refunding and the improvements must be accomplished as soon as possible in order to
make the System adequate for the needs of the City and its inhabitants, without which
the life, health, safety and welfare thereof are jeopardized, and that the issuance of the
bonds and the taking of the other action authorized by this Ordinance is necessary for
the accomplishment thereof. It is, therefore, declared that an emergency exists and
this Ordinance being necessary for the immediate preservation of the public peace,
health and safety shall take effect and be in force from and after its passage.
843646-v1
ORDINANCE NO. 1387 ( #30 - 09)
Page 31 000031
APPROVED AND ADOPTED THIS 9 DAY OF NOVEMBER, 2009.
CITY OF JACKSONVILLE, ARKANSAS
/s/ Gary Fletcher
GARY FLETCHER, MAYOR
ATTEST:
1
SUSAN D ' IIT, CITY RK
/
'PR• 1 I A; /, 1
s k� -
_
ROB: • T E. BA � e [ ATTORN
843646•v1
ORDINANCE ND. 1387 ( #30 — 09)
Page32 000032
CERTIFICATE
STATE OF ARKANSAS )
COUNTY OF PULASKI )
I, Susan Davitt, City Clerk/Treasurer, within and for the City of Jacksonville,
Arkansas do hereby certify that the foregoing is a true and correct copy of Ordinance
No. 1387 ( #30 -09) of the Ordinances of the City of Jacksonville, Arkansas entitled: "AN
ORDINANCE AUTHORIZING THE CONSTRUCTION OF BETTERMENTS AND
IMPROVEMENTS TO THE WASTEWATER SYSTEM OF THE CITY OF
JACKSONVILLE, ARKANSAS; AUTHORIZING THE ISSUANCE AND SALE OF
WASTEWATER REFUNDING AND CONSTRUCTION REVENUE BONDS, SERIES
2009, IN ONE OR MORE SERIES; PROVIDING FOR THE PAYMENT OF THE
PRINCIPAL OF AND INTEREST ON THE BONDS; PRESCRIBING OTHER
MATTERS RELATING THERETO; AND DECLARING AN EMERGENCY;" passed by
the City Council of the City on November 5, 2009.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 5th day of
November, 2009. •
SAS • IP
s u : • eavitt
Susan Da , City CI
843646-v1