Loading...
HomeMy WebLinkAboutOrdinance 1449 CANT\r ORDINANCE NO . AN ORDINANCE PROVIDING FOR THE ISSUANCE OF SANITATION IMPROVEMENT REVENUE BONDS ; SETTING UP CERTAIN FUNDS ; PRESCRIBING OTHER MATTERS RELATING THERETO ; AND DECLARING AN EMERGENCY . WHEREAS it has been found by the City Council of the City of Fayetteville , Arkansas ( called "City" ) that the garbage and rubbish collection , hauling and disposal service ( called " Sanitation System" or "Sys"tem" ) presently serving the City is inadequate for the needs of the City and its inhabitants ; and WHEREAS the City Council has determined that the Sanitation System should be improved and extended and has accepted a special report and estimates of costs of the needed improve- ments and extensions , which report is on file with the City Clerk and to which reference may be made by any interested person , and which in general calls for the following improvements : purchase ' of trucks , containers and other equipment necessary for the collec - tion of garbage and rubbish , construction of an incinerator for the disposal of garbage and rubbish , purchase of equipment for leaf pick- up and disposal , purchase of equipment for insecticidal fogging for the control of flies and other insects , construction of an animal shelter , purchase of trucks , vehicles and other equipment necessary for the supervision of the Sanitation System ( which will be hereinafter referred to as the " improvements " ) , all at an estimated cost of $ 200 , 000 . 00 , including legal and other necegsary expenses incidental to the purchase and construction MiCXFILMED DATE OCT 1 0 1978 REEL of the improvements and to the issuance of revenue bonds ; and WHEREAS the City can obtain funds with which to pay for said improvements by the issuance of revenue bonds to be repaid from sanitation service fees ; and WHEREAS the City has made arrangements for the sale of its $200 , 000 City of Fayetteville 3 1 / 2% Sanitation Improvement Revenue Bonds dated July 1 , 1965 and due on July 1 in each of the years 1966 to 1980 , inclusive , to T . J . Raney & Sons , Little Rock , Arkansas ( called " purchaser " ) , and the purchaser has elected to convert said bonds to an issue of $ 205 , 400 in bonds bearing interest at the rates of 3 and 3 1 / 4% per annum , and maturing as hereafter set forth ; NOW , THEREFORE , BE IT ORDAINED by the City Council of the City of Fayetteville , Arkansas : X Section 1 . That the purchase and erection of said improvements be , and the same are hereby , approved , ratified and confirmed . Section 2 . That the sale of $ 200 , 000 in bonds bearing interest at the rate of 3 1 / 2% , maturing as set forth above , to T . J . Raney & Sons , Little Rock , Arkansas , and the conversion of said bonds to an issue of $ 205 , 400 in bonds bearing interest at the rates of 3% and 3 1 /4'/o per annum , as set forth below, be , and the same are hereby , approved and confirmed . Section 3 . That there are hereby authorized and ordered issued City of Fayetteville , Arkansas , Sanitation Improve- ment Revenue Bonds in the total amount of $ 205 , 400 , the proceeds of the sale of which are necessary to pay for said improvements . The bonds shall be dated July 1 , 1965 , and interest shall be pay- able semiannually on January 1 and July 1 of each year commencing January 1 , 1966 . The bonds shall be numbered consecutively from 1 to 206 , inclusive , and shall be in the denomination of $ 1 , 000 each , except Bond No . 11 which shall be in the denomination of $400 . Bonds Nos . 1 to 125 , inclusive , shall bear interest at the rate of 3% per annum and Bonds Nos . 126 to 206 , inclusive , shall bear interest at the rate of 3 1 /4% per annum , which shall be evidenced by interest coupons , and the principal and interest shall be pay- able in lawful money of the United States of America upon presenta- tion of the bond or proper coupon at the office of Worthen Bank & Trust Company , Little Rock , Arkansas . The bonds shall be negotiable coupon bonds payable to bearer and shall mature on . July 1 of each year as follows , but shall be callable for pay- ment prior to maturity as hereafter set forth : YEAR BOND NOS , AMOUNT 1966 1 - 11 $ 10 , 400 1967 12 - 22 11 , 000 1968 23 - 34 122000 1969 35 - 46 12 , 000 1970 47 - 58 . 12 , 000 1971 59 - 71 132000 1972 72 - 84 13 , 000 1973 85 - 97 13 , 000 1974 98 - 111 14 , 000 1975 112 - 125 14 , 000 1976 126 - 140 15 , 000 1977 141 - 155 152000 1978 156 - 171 16 , 000 1979 172 - 188 172000 1980 189 - 206 182000 Section 4 . That the City has examined the computation by which an issue of $200 , 000 in bonds bearing interest at the rate of 3 1 /2% maturing in the years 1966 through 1980 has been converted to an issue of $ 205 , 400 in bonds bearing interest at the rates of 3% and 3 1 /4% per annum , as above set forth , and has found that by virtue thereof the City will receive no less and pay no more than it would receive and pay if the bonds were not converted . Section 5 . That the bonds shall be executed on behalf of the City by the Mayor and City Clerk (with either the facsimile or manual signature of the Mayor and the manual signature of the City Clerk) and shall have impressed thereon the seal of the City . Interest coupons attached to the bonds shall be signed by the facsimile signature of the Mayor , and the facsimile signature of the Mayor lithographed or printed on the bonds or coupons shall have the same force and effect as if he had signed each of said honk` and coupons . The bonds together with interest thereon shall be payable solely out of the Sanitation Revenue Bond Fund , as hereafter set forth , and shall be a valid claim of the holders thereof only against such fund and the amount of revenues pledged to such fund , which revenues are hereby pledged and mortgaged in an amount sufficient to provide for the equal and ratable payment of said bonds . The bonds and interest thereon shall not constitute an indebtedness of the City within any constitutional or statutory limitation . Section 6 . That the bonds and coupons shall be in substantially the following form , and the Mayor and City Clerk are hereby expressly authorized and directed to make all recitals contained therein : UNITED STATES OF AMERICA STATE OF ARKANSAS COUNTY OF WASHINGTON CITY OF FAYETTEVILLE SANITATION IMPROVEMENT REVENUE BOND No . $ KNOW ALL MEN BY THESE PRESENTS : That the City of Fayetteville , County of Washington , State of Arkansas , acknowkdges itself to owe , and for value received , hereby promises to pay to bearer , solely from the special fund provided as hereinafter set forth , the principal sum of DOLLARS in lawful money of the United States of America on the first day of July , 19 , and to pay solely from said special fund interest hereon at the rate of per cent ( %) per annum from date , semiannually on the first days of January and July , commencing January 1 , 1966 , upon presentation and surrender of the annexed coupons as they severally become due . Both princi- pal and interest on this bond are made payable at the principal office of Worthen Bank & Trust Company , Little Rock , Arkansas . This bond is one of an issue of two hundred six ( 206 ) revenue bonds , aggregating Two Hundred Five Thousand Four Hundred Dollars ( $205 , 400) , dated July 1 , 1965 , and numbered from one ( 1 ) to two hundred six (206 ) , inclusive , all of like tenor and effect except as to number , denomination , rate of interest , maturity and right of prior redemption , issued for the purpose . of acquiring and constructing Sanitation System improvements ( described in the authorizing ordinance) and paying necessary expenses incidental thereto . This bond and the issue of which it forms a part are issued in full compliance with the Constitution and laws of the State of Arkansas , and pursuant to Ordinance No . / 4+3 of the City Council of Fayetteville , Arkansas , duly adopted and approved in x1n on the Z&A day of 1965 ( called "authorizing ordinance" ) , and do not constitute an indebtedness of the City of Fayetteville within any constitutional or statutory limitations . / The bonds are not general obligations of the City but are special obligations payable solely from net revenues derived from the Sanitation System ( defined in the authorizing ordinance ) which have been duly pledged to the payment of the principal of and interest on the bonds . A sufficient amount of the net revenues are to be set aside as a special fund identified as the Sanitation Revenue Bond Fund , created by the authorizing ordinance , and used solely for the' payment of the principal of , interest on and paying agent ' s fees in connection with the bonds . Reference is hereby made to the authorizing ordinance for a detailed statement of the revenues pledged for the payment of the bonds , the nature and extent of the security for the bonds , and the rights and obligations of the City , the Trustee and the bondholders . The City has fixed and has covenanted and agreed to maintain rates for the services of the Sanitation System which shall be sufficient at all times to provide for the proper and reasonable expenses of operation and maintenance of the Sanitation System , the maintenance of a separate Depreciation Fund for nepessary replacements to the Sanitation System , and to provide 150% of the maximum amount that will become due in any year for principal , interest and paying agent ' s fees on all outstanding bonds payable from the revenues of the Sanitation System . This bond shall be negotiable under the laws of the State of Arkansas and is issued with the intent that the laws of the State of Arkansas shall govern the construction thereof . The bonds shall be callable for payment prior to maturity in inverse numerical order at par and accrued interest as follows : from the unexpended proceeds from the sale of the bonds of this issue and from surplus revenues of the Sanitation System on any interest payment date ; from funds from any source on any interest payment date on and after July 1 , 1970 . Notice of the call for redemption shall be published one time in a newspaper published in the City of Little Rock , Arkansas and having a general circulation throughout the State of Arkansas , giving the number and maturity of each bond being called , with the publication to be at least fifteen ( 15 ) days prior to the redemption date , and after the date fixed for redemption each bond so called shall cease to bear interest, pro- vided funds for its payment are on deposit with the paying agent at that time . This bond shall not be valid until it shall have been authenticated by the certificate hereon duly signed by Worthen Bank & Trust Company , Little Rock , Arkansas , Trustee . IT IS HEREBY CERTIFIED , RECITED AND DECLARED that all acts , conditions and things required to exist ; happen and be per- formed precedent to and in the issuance of this bond have existed , have happened and have been performed in due time , form and manner , as required by law ; that the indebtedness represented by this bond and the issue of which it forms a part does not exceed any constitu- tional or statutory limitations ; and that sufficient of the revenues derived from the operation of the Sanitation System have been pledged to and will be set aside into said special fund for the payment of the principal of and interest on the bonds . IN WITNESS WHEREOF the City of Fayetteville , Arkansas , by its City Council , has caused this bond to be signed by the facsimile signature of the Mayor and the manual signature of the City Clerk , and sealed with the corporate seal of said City , and has caused the interest coupons hereto attached to be executed by the facsimile signature of the Mayor , all as of the first day of July , 1965 . CITY OF FAYETTEVILLE , ARKANSAS By. ( facsimile signature ) Mayor ATTEST : City Clerk (SEAL) Section 7 . That the rates to be charged for services furnished by the Sanitation System heretofore fixed by Ordinance No . 1443 of the ordinances of the City , passed and approved on the 26th day of April , 1965 , and the conditions , rights and obligations pertaining thereto set out in said Ordinance No . 1443 are hereby ratified and confirmed . Section 8 . That the Treasurer designated by the City shall be custodian of the gross revenues derived from the operation of the Sanitation System and shall give bond for the faithful discharge of his duties as such custodian and all references herein to "Treasurer " shall mean the person so designated . If the City Treasurer be so designated as Treasurer of the funds herein referred to , then no additional bond shall be required ; otherwise , the amount of the bond shall be in the sum of $ 10 , 000 and shall be approved by the Trustee . From and after the delivery of any bonds issued under the provisions of this ordinance , the System shall be continuously operated as a revenue producing undertaking . All moneys received by the Treasurer shall be deposited by him in such depository or depositories for the System as may be lawfully designated from time to time by the City , subject however to the giving of security as now or as hereafter may be required by law , and providing that such depository or depositories shall hold membership in the Federal Deposit Insurance Corporation . All deposits shall be so designated as to indicate the p g particular fund to which tale revenues belong . Any deposits in excess of the amount secured by the Federal Deposit Insurance Corporation shall be secured by bonds or other direct or fully guaranteed obligations of the United States of America . (Form of Coupon) $ No . January On the first day of July , 19 , the City of Fayetteville , Washington County , Arkansas , unless the bond to which this coupon is attached is paid prior thereto , hereby promises to pay to bearer , solely out of the funds specified in the bond to which this coupon is attached DOLLARS principal in lawful money of the United States of America at the /office of Worthen Bank & Trust Company , Little Rock , Arkansas , Paying Agent , being six (6 ) months ' interest then due on its Sanitation Improvement Revenue Bond dated July 1 , 1965 , and numbered CITY OF FAYETTEVILLE , ARKANSAS By ( facsimile signature ) On each bond shall appear the following CERTIFICATE Worthen Bank & Trust Company , Little Rock , Arkansas , hereby certifies that this is one of a series of bonds described herein aggregating $205 , 400 numbered from 1 to 206 , inclusive , all of like tenor and effect except as to number , denomination , rate of interest , maturity and right of prior redemption . WORTHEN BANK & TRUST COMPANY LITTLE ROCK , ARKANSAS By (Authorized Signature) Section 9 . Sanitation Fund . All revenues derived from the operation of the Sanitation System , shall be paid into a special fund which is hereby created and designated "Sanitation Fund " . Such revenues so deposited in the Sanitation Fund shall be applied to the Operation and Maintenance Fund , the Sanitation Revenue Bond Fund and the Sanitation Depreciation Fund and shall be used only as authorized by this ordinance . Section 10 . Sanitation System Operation and Maintenance . Fund . There shall be paid by the Treasurer from the Sanitation Fund into a fund which is hereby created and designated "Sanitation System Operation and Maintenance Fund" (sometimes called ' Operation and Maintenance Fund" ) , beginning on the first business day of the month immediately following the month in which the bonds are deliver- ed and continuing on the first business day of each month thereafter while any of the bonds of this issue shall be 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 Sanitation System 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 said fund , the amount of any deficiency shall be added to the amount otherwise required to be transferred and paid into said fund in the next succeeding /' month . If in any fiscal year a surplus shall be accumulated in x the Sanitation System Operation and Maintenance Fund over and above the amount which shall be necessary to insure the prompt payment of the reasonable and necessary costs of operation, repair and maintenance of the System, such surplus may be trans- ferred and deposited in the Sanitation Revenue Bond Fund (here- after created) or to the Sanitation Depreciation Fund (hereafter created) as the Council may designate; provided, however, that any such transfer into the Sanitation Revenue Bond Fund shall be in addition to all other payments required to be made into said fund. Section 11. Sanitation Revenue Bond Fund. After the required payments into the Sanitation System Operation and Maintenance Fund, there shall be paid by the Treasurer from the Sanitation Fund into a fund which is hereby created and designated "Sanitation Revenue Bond Fund", the sums in the amounts and at the times here- inafter stated for the purpose of providing funds for the payment of the principal of and interest on the bonds herein authorized and the paying agent's fees, as they mature, and as a reserve for contingencies. The principal and interest matures according to the following schedule: YEAR BOND NOS. PRINCIPAL JANUARY INTEREST 1 JULY 1 TOTAL 1966 1 -. 11 $ 10,400 $3,182.25 $3,182.25 $16,764.50 1967 12 - 22 11,000 3,026.25 3,026.25 17,052.50 1968 23 - 34 12,000 2,861.25 2,861.25 17,722.50 1969 35 - 46 12,000 2,681.25 2,681.25 17,362.50 1970 47 - 58 12,000 2,501.25 2,501.25 17,002.50 1971 59 - 71 13,000 2,321.25 2,321.25 17,642.50 1972 72 - 84 13,000 2,126.25 2,126.25 17,252.50 1973 85 - 97 13,000 1,931.25 1,931.25 16,862.50 1974 98 - 111 14,000 1,736.25 1,736.25 17,472.50 1975 112 - 125 14,000 1,526.25 1,526.25 17,052.50 1976 126 - 140 15,000 1,316.25 1,316.25 17,632.50 1977 141 - 155 15,000 1,072.50 1,072.50 17,145.00 1978 156 - 171 16,000 828.75 828.75 17,657.50 1979 172 - 188 17,000 568.75 568.75 18,137.50 1980 189 - 206 18,000 292.50 292.50 18,585.00 There shall be paid by the Treasurer from the Sanitation Fund into the Sanitation Revenue Bond Fund beginning on the first business day of the month immediately following the month in which the bonds are delivered, and continuing on the first business day of each month thereafter until all outstanding bonds of this issue with interest thereon have been paid in full, or provision made for suchpayment, a sum equal to one -fifth (1/5) of the next installment of interest and one -tenth (1/10) of the next installment of principal and an amount sufficient to provide for the paying agent's fees; provided, however, that when there shall have been accumulated in said Sanitation Revenue Bond Fund a reserve for con- tingencies in the amount of $17,000, so long as said reserve for contingencies is maintained in that amount the monthly payments may be reduped to one -sixth (1/6) of the next installment -of the interest and one -twelfth (1/12) of the next installment of principal and an amount sufficient to provide for the paying agent's fees. If the revenues of the System are insufficient to make the requir- ed payment on the first business day of the following month into the Sanitation Revenue Bond Fund, then the amount of any such deficiency in the payment made shall be added to the amount other- wise required to be paid into the Sanitation Revenue Bond Fund on the first business day of the next month. If for any reason the Treasurer shall fail at any time to make any of the required payments into the Sanitation Revenue Bond Fund, any sums then held as a reserve for contingencies shall be used to the extent necessary in the payment of the principal of and interest on the bonds, but such reserve shall be reimbursed from the Sanitation Fund before any of the moneys in the Sanitation Fund shall be used for any other purpose except for making the pay- ments hereinabove required to be made into the Operation and Main- tenance Fund and the Sanitation Revenue Bond Fund. If investments of moneys in the reserve for contingencies increase it above $17,000, the excess over $17,000 may be transferred to the Sanita- tion Revenue Bond Fund and used as other moneys therein may be used. The moneys in the reserve for contingencies shall be used solely as in this paragraph provided. When moneys held in the Sanitation Revenue Bond Fund, including the reserve for contingencies, shall be and remain sufficient, to pay the principal, interest and paying agent's fees on all bonds then outstanding, the Treasurer shall not be obliged to make any further payments into the Sanitation Revenue Bond Fund. It shall be the duty of the Treasurer to withdraw from the Sanitation Revenue Bond Fund at least ten (10) days before the maturity date of any bond or interest coupon issued hereunder and to deposit with the paying agent an amount equal to the amount of such bond or coupon for the sole purpose of paying the same, together with the paying agent's fee, and no withdrawal of funds from the Sanitation Revenue Bond Fund shall be made for any other purpose except as otherwise authorized in this ordinance. Such deposit shall be at the sole risk of the City and shall not operate as a payment of the bonds or coupons until so applied. If a sur- plus shall exist in the Sanitation Revenue Bond Fund over and above the amount necessary to insure the prompt payment of the principal of, interest on and paying agent's fees in connection with the bonds, as the same become due, and to maintain the reserve for - contingencies in the required amount, the surplus may be used to redeem the bonds prior to maturity. The bonds of this issue shall be specifically secured by a pledge of all the net revenues of the System (being gross revenues less reasonable operation and maintenance expenses of the System). Said pledge in favor of the bonds is hereby irrevocably made accord- ing.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 12. Sanitation Depreciation Fund. After making the required payments into the Operation and Maintenance Fund and the Sanitation Revenue Bond Fund, there shall be paid by the Treasurer from the Sanitation Fund into a fund, which is hereby created and designated "Sanitation Depreciation Fund", on the first business day of the month immediately following the month in which the bonds are delivered and continuing on the first busi- ness day of each month thereafter while any of the bonds of this issue are outstanding, the sum of $2,083.33. The moneys in the Sanitation Depreciation Fund shall be used solely for the purpose of paying the cost of replacements made necessary by the deprecia- A tion of the System, except that moneys therein may be used to pay the principal of and interest on the bonds as they mature in the event there are no other moneys available therefor. If in any fiscal year a surplus shall be accumulated in the Sanitation 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 Sanitation Revenue Bond Fund; provided, however, that such payments into the Sanitation Revenue Bond Fund shall be in addition to all other payments hereinbefore required to be made into the Sanitation Revenue Bond Fund. /1) Section 13. That any surplus in the Sanitation Fund, after making full provision for the Operation and Maintenance Fund, the Sanitation Revenue Bond Fund and the Sanitation Deprecia- tion Fund, as herein provided, may be used for calling bonds for payment prior to maturity in accordance with the provisions here- in set forth, or for any other lawful municipal purpose. Section 14. That payments from all funds shall be made by check or voucher signed by the Treasurer and one other person designated by the City. The checks or vouchers shall be drawn on the depository with which the moneys in the particular fund shall have been deposited, and each such check or voucher shall briefly specify the purpose of the expenditure. Section 15. That the City hereby agrees that all payments on the bonds and interest shall be made only through the paying agent. All bonds paid or purchased either at or before maturity shall be cancelled when such payment or purchase is made, together with all unmatured coupons appertaining thereto, and held by the Treasurer, and shall not be reissued. All unpaid interest coupons maturing on or prior to the date of such payment or purchase shall continue -to be payable to the respective bearers thereof. Section 16. That as long as any of the bonds authorized and issued under and pursuant to the provisions of this ordinance are outstanding, the City shall not issue or attempt to issue any bonds, nor shall the City assume any other indebtedness, which shall have a priority of lien on the revenues of the System over the lien securing the bonds of this issue. However, nothing in this ordi- nance shall be construed to prevent the issuance by the City of additional bonds for improvements to the System, provided that the City shall not authorize or issue any such additional bonds ranking on a parity with the outstanding bonds of this issue, unless there shall have been procured and filed with the Trustee a statement by. an independent Certified Public Accountant not in the regular employ of the City reciting the opinion based upon necessary investigation that net revenues of the System (defined as gross revenues of the System less the operation and maintenance expenses of the System and less the required deposit in the Depreciation Fund as determined by the independent Certified Public Accountant) for the fiscal year immediately preceding the fiscal year in which it is proposed to issue such additional bonds, plus any increase in annual net revenues that will result by virtue of change in rates or additional or extended services of the System, as determined by the independent Certified Public Accountant, shall equal 1507, of the maximum amount that will become due in any year thereafter for principal, interest and paying agent's fees on the bonds then outstanding and the bonds then proposed to be issued. Section 17. That it is covenanted and agreed by the City with the holders of the bonds that the City will faithfully and punctually perform all duties with reference to the System required by this ordinance and by the Constitution and laws of the State of Arkansas, including the continual charging and collecting of suffi- cient rates for the services of the System, as hereinabove referred to, and the segregating and depositing of the funds as provided herein. Section 18. That the bonds authorized hereby and issued hereunder shall be callable for payment prior to maturity in accord- ance with the terms set out in the bond form. Section 19. That the City will keep proper books of accounts and records 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 holder of any of the bonds at reasonable times and under reasonable circum- stances. The City dependent Certified request such audit. make the audit, the audit made, and the Sanitation Fund. agrees to have these records audited by an in - Public Accountant as and when the Trustee may In the event the City fails or refuses to Trustee or any holder of the bonds may have the cost thereof shall be charged against the Section 20. That the City covenants and agrees that it will cause the Sanitation System to be operated in an efficient and bus - mess like manner at reasonable cost. The trucks, equipment and other property of the System, both real and personal, shall be maintained and replaced as necessary to insure the continued opera- tion of the System, and the production of revenues therefrom, and the loss from fire, lightning, winds or any other cause, of any property or equipment essential to the revenue -producing capacity of the System shall be promptly replaced out of any insurance proceeds covering said loss, and if such proceeds shall be in- sufficient. for such purposes, the deficiency shall be supplied first, from moneys in the Sanitation Depreciation Fund, and second, from moneys in the Operation and Maintenance Fund, and third, from surplus moneys in the Sanitation Fund. The City shall keep x all insurable properties of the System insured by fire and extended coverage insurance at least to the extent normally covered by a private company engaged in a similar operation and shall furnish evidence of such insurance to the Trustee. .A Section 21. That the City covenants and agrees that, except as herein provided, so long as any bonds authorized hereby are outstanding it will not mortgage, pledge or otherwise encumber the System, or any of its revenues, equipment or property, and will not sell, lease or otherwise dispose of any substantial portion of the same, without making provision for sufficient replacements to insure the continued efficient operation of the System. Section 22. That if there be any default in the payment of the principal of or interest on any bonds of this issue, or if the City defaults in any Sanitation Revenue Bond Fund requirement or in the performance of any of the other covenants contained and set forth in this ordinance, the Trustee may, and upon the written request of the holders of not less than ten per cent (10%) in prin- cipal amount of the bonds of this issue then outstanding shall, by proper suit compel the performance of the duties of the officials of the City. And, in the case of a default in the payment of the principal of and interest on any of the outstanding bonds of this issue, the Trustee may, and upon the written request of the holders of not less than ten per cent (107,) in principal amount of the bonds of this issue then outstanding shall, apply in a proper action to a court of competent jurisdiction for the appoint- ment of a receiver to administer the System on behalf of the City and the bondholders, with power to charge and collect (or by mandatory injunction or otherwise to cause to be charged and collected) rates sufficient to provide for the payment of the U expenses of operation, repair and maintenance and to pay any bonds and interest outstanding and to apply the .revenue in con- formity 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. If the Trustee. shall fail to carry out said duty, then the holders of not less than ten per cent (10%) in principal amount of the bonds of this issue then outstanding may institute any suit, action, mandamus or other proceeding in equity or in law for the protection or enforcement of any right under this ordinance, such action to be in the name of one or more bondholders for the benefit of all holders of the outstanding bonds and coupons, and the individual rights of action of the bondholders are restricted by this ordinance to the rights and remedies herein provided. No delay or omission of the Trustee or of any holders of the bonds to exercise any right or power accrued upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this ordinance to the Trustee and to the holders of the bonds, respectively, may be exercised from time to time and as often as may be deemed expedient. Section 23. (a) That when the bonds have been executed by the Mayor and City Clerk and the seal of the City impressed as herein provided, they shall be delivered to the trustee, which shall authenticate them and deliver them to the purchaser upon payment of cash to the Trustee of the purchase price and accrued interest from July 1, 1965 to the date of delivery. (b) The Trustee shall deposit the accrued interest in the Sanitation Revenue Bond Fund. (c) The Trustee shall remit the remaining balance of the proceeds of the sale of the bonds for deposit in a special account A designated "Construction Fund" with a depository that is a member of the Federal Deposit Insurance Corporation to be designated in a letter of instructions delivered to the Trustee, signed by the Mayor, at the time of the closing of the bond issue. The moneys in the Construction Fund in excess of the amount insured by the Federal Deposit Insurance Corporation shall be continuously secured by bonds or other direct or fully guaranteed obligations of the United States of America, except that any moneys invested as hereafter authorized need not be so secured. (d) The moneys in the Construction Fund shall be disbursed solely in paymentfi±r the improvements as hereinabove defined, in - 4 eluding expenses necessary and incidental thereto and to the issuance of the bonds. (e) That when the Construction of the improvements shall have been completed, as evidenced by a letter so stating, signed by the Mayor and City Cleric, the depository with which the Con- struction Fund is deposited shall pay or transfer any remaining balance pursuant to said letter for the sole purpose of calling the bonds of this issue for payment prior to maturity, or if insufficient to call one or more bonds, for transfer into the Sanitation Revenue Bond Fund. Section 24. Moneys held for the credit of any fund referred to in this ordinance may, at the option of the City, be invested and reinvested pursuant to direction of the City in direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States Govern - lent, which shall mature, or which shall be subject to redemption by the holder thereof at the option of the holder, not later than the date or dates when the moneys held for the credit of the par- ticular fund will be required for the purposes intended. Obliga- Lions so purchased as an investment of moneys in any such fund shall be placed in the custody of the Treasurer and shall be deemed at all times to be a part of such fund, and the interest accruing thereon and any profit realized from such investment shall be credited to such fund, and any loss resulting from such investment shall be charged to such fund. ction 25. That the provisions of this ordinance shall constitute a binding contract between the City and the holders of the outstanding bonds and coupons issued hereunder, and the City will strictly adhere to the provisions hereof. The holders of not less than seventy-five per cent (75%) in aggregate principal amount of the bonds then outstanding shall have the right from time to time 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 con- tained in this ordinance or in any supplemental ordinance; provided, however, that nothing herein contained shall permit or shall be construed as permitting (a) an extension of the maturity of the principal of or the interest on any bond issued hereunder, or (b) a reduction in the principal amount of any bond or the rate of interest therein, or (c) the creation of a lien upon or a pledge of revenues other than as expressly authorized by the appropriate pro- visions of this ordinance as now adopted, or (d) the creation of a privilege of priority of any bond or bonds over any other bond or bonds, or (e) a reduction in the aggregate principal amount of the bonds required for consent to such supplemental ordinance. Section 26. That the Trustee of the bonds issued hereunder shall be Worthen Bank & Trust Company, Little Rock, Arkansas. 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 holders of not less than ten per cent (107) in principal amount of the bonds of this issue then outstanding and shall have been offered reason- able security and indemnity against the costs, expenses and liabili- ties to be incurred therein or thereby. The Trustee may resign at any time by ten (10) days' notice in writing to the Mayor, and the majority in value of the holders of the outstanding bonds of this issue at any time, with or without cause, may remove the Trustee. In the event of a vacancy in the office of Trustee, either by resignation or by removal, the majority in value of the holders of the outstanding bonds of this issue may appoint a new Trustee, such appointment to be evidenced by a written instrument or in- struments filed with the City Clerk. If the majority in value of the holders of the outstanding bonds of this issue shall fail to fill a vacancy within thirty (30) days after the same shall, occur, then the City shall forthwith designate a new Trustee by a written instrument filed in the office of the City Clerk. 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 holders of the bonds agree. Such , written acceptance shall be filed with the City Clerk, and a copy thereof shall be placed in the bond transcript. Any successor Trustee shall have all the powers herein granted to the original Trustee. The old Trustee upon resignation or removal shall cease to be Paying Agent and the successor trustee shall automatically become Paying Agent. Section 27. That the provisions of this ordinance are hereby declared to be separable, and if any provision shall for any reason be held illegal or invalid such holding shall not affect the validity of the remainder of the ordinance. Section 28. That all ordinances and parts of ordinances in conflict herewith are hereby repealed to the extent of such conflict. Section 29. That it is hereby ascertained and declared that said improvements are necessary to the health the inhabitants of the City, and that the construc improvements is necessary in order to alleviate an unsafe condition which exists in the City. It is, that an emergency exists, and this ordinance being immediate preservation of the public peace, health and safety of tion of said unhealthy and therefore, declared necessary for the and safety shall take effect and be in force from and after its passage. PASSED:$Ik..4__ ,9.J , 1965. APPROVED: ATTEST: Mayor (SEAL) • CERTIFICATE The undersigned, Clerk of the City of Fayetteville, Arkansas, hereby certifies that the foregoing pages numbered 1 to 25, inclusive, are a true and correct copy of Ordinance No.�ZL, adopted at a session of the Council of the City of Fayetteville, Arkansas, held at the regular meet- ing place of the Council in said City at Z� D o'clock 4_.m.,cI'� T on the ay of , 1965, and that said ordinance is of record in Ordinance Record Book G' , page now in my possession. GIVEN under my hand and seal this _Say of 1965. (SEAL)