HomeMy WebLinkAboutOrdinance 4718 ORDINANCE NO. 4718
AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF NOT TO
EXCEED $65,000,000 OF A SALES AND USE TAX CAPITAL
IMPROVEMENT BOND, SERIES 2005, BY THE CITY OF FAYETTEVILLE,
ARKANSAS FOR THE PURPOSE OF FINANCING A PORTION OF THE
COSTS OF ACQUIRING, CONSTRUCTING AND EQUIPPING A NEW
WASTEWATER TREATMENT FACILITY AND RELATED SEWERAGE
IMPROVEMENTS; PROVIDING FOR THE PAYMENT OF THE PRINCIPAL
OF AND INTEREST ON THE SERIES 2005 BOND; AUTHORIZING THE
EXECUTION AND DELIVERY OF A BOND PURCHASE AGREEMENT
PROVIDING FOR THE SALE OF THE SERIES 2005 BOND; AUTHORIZING
THE EXECUTION AND DELIVERY OF A CONTINUING DISCLOSURE
AGREEMENT; AND PRESCRIBING OTHER MATTERS RELATING
THERETO
WHEREAS, the City Council of the City of Fayetteville, Arkansas (the "City") has
determined that there is a great need for a source of revenue to finance the costs of acquisition,
construction and equipping of a new wastewater treatment facility and related sewerage
improvements to serve the western portion of the City (the "Project'); and
WHEREAS, based on the engineering report (the "Engineering Report") of McGoodwin,
Williams and Yates, Fayetteville, Arkansas, which Engineering Report has been reviewed by the
City Council, it has been determined that the remaining costs of the Project are in excess of
$65,000,000; and
WHEREAS, the City is authorized and empowered under the provisions of the
Constitution and laws of the State of Arkansas, including particularly Amendment 62 to the
Constitution of the State of Arkansas ("Amendment 62") and Arkansas Code Annotated (1998
Repl. & 2003 Supp.) Sections 14- 164-301 et seq. (as from time to time amended, the "Local
Government Bond Act'), to issue and sell its capital improvement bonds to finance the costs of
various capital improvements such as those comprising the Project, which capital improvement
bonds may be secured by and payable from the receipts of the special city-wide sales and use tax
authorized by the Local Government Bond Act; and
WHEREAS, pursuant to the provisions of Ordinance No. 4327 of the City, adopted and
approved on August 7, 2001 (the "Election Ordinance"), there was submitted to the qualified
electors of the City the question of the issuance of not to exceed $ 125,000,000 in aggregate
principal amount of capital improvement bonds pursuant to Amendment 62 and the Local
Government Bond Act to finance a portion of the wastewater system improvements described in
the Election Ordinance, said bonds to be secured by a pledge of and lien upon all of the receipts
of a special city-wide sales and use tax levied at the rate of three-quarters of one percent (0.75%)
pursuant to the Local Government Bond Act (the "Sales and Use Tax"); and
WHEREAS, at a special election held November 6, 2001 , a majority of the qualified
electors of the City voting on the question approved the issuance of said capital improvement
bonds (and the corresponding levy of the Sales and Use Tax and the pledge of Sales and Use Tax
receipts to the payment of the capital improvement bonds); and
WHEREAS, pursuant to such authority, the City has previously issued its $25,000,000
Sales and Use Tax Capital Improvement Bonds, Series 2002 (the "Series 2002 Bonds"), and its
$35,000,000 Sales and Use Tax Capital Improvement Bonds, Series 2004 (the "Series 2004
Bonds"), in order to provide for the funding of various wastewater system improvements,
including initial portions of the Project; and
WHEREAS, the Series 2002 Bonds have been redeemed in full from receipts of the
Sales and Use Tax; and
WHEREAS, as authorized under the provisions of Amendment 62 and the Local
Government Bond Act and as approved by the qualified electors of the City, and in order to
secure funds necessary to pay a portion of the costs of engineering, planning, designing,
acquiring, constructing and equipping of the Project, and the legal costs incident to the issuance
of a revenue bond to finance the costs of said Project, upon the most favorable terms to the City
and the users of the City's wastewater system, the City has made arrangements for the sale of its
Sales and Use Tax Capital Improvement Bond, Series 2005 (the "Series 2005 Bond"), in the
principal amount of not to exceed $65,000,000 to the Arkansas Development Finance Authority,
as purchaser (the "Bondholder"), at a price of par, which Series 2005 Bond shall bear interest at
the rate of two percent (2.00%) per annum, pursuant to a Bond Purchase Agreement (the "Bond
Purchase Agreement") among the City, the Bondholder and the Arkansas Soil and Water
Conservation Commission (the "Commission"); and
WHEREAS, the City will also be required to pay to the Arkansas Development Finance
Authority, as servicer with respect to the Series 2005 Bond (the "Authority"), a semiannual
servicing fee equal to one percent (1 .00%) per annum of the outstanding principal amount of the
Series 2005 Bond (the "Servicing Fee"); and
WHEREAS, the Series 2005 Bond will be issued and secured by the Sales and Use Tax
receipts on a panty basis with the Series 2004 Bonds, except that the Series 2005 Bond will not
be secured by the debt service reserve securing the Series 2004 Bonds ; and
WHEREAS, a copy of the Bond Purchase Agreement has been presented to and is
before this meeting;
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FAYETTEVILLE, ARKANSAS:
Section 1 : The Project shall be accomplished and shall be a part of the City's
wastewater system (the "System"). The accomplishment of the Project shall be under the control
and supervision of, and all details in connection therewith shall be handled by, the City, and the
City shall make all contracts and agreements necessary or incidental to the performance of its
duties and the execution of its powers. The City shall let all contracts pursuant to and in
accordance with existing laws and shall require such performance bonds and insurance from the
contractors as will fully insure completion of the Project in accordance with the Engineering
Report so as to fully promote and protect the best interests of the City and the Bondholder.
2 '
Section 2: The sale to the Bondholder of the City's Series 2005 Bond in the
maximum principal amount of $65,000,000 at a price of par, such Series 2005 Bond to bear
interest at the rate of 2.00% per annum and to be subject to a Servicing Fee of 1 .00% per annum
and otherwise to be subject to the terms and provisions hereafter in this Ordinance set forth in
detail be, and is hereby approved and the Series 2005 Bond is hereby sold to the Bondholder.
The Mayor is hereby authorized and directed to execute and deliver the Bond Purchase
Agreement on behalf of the City and to take all action required on the part of the City to fulfill its
obligations under the Bond Purchase Agreement. The Bond Purchase Agreement is hereby
approved in substantially the form submitted to this meeting with such changes as may be
approved by the Mayor, his execution to constitute complete evidence of such approval.
Section 3 : The City Council hereby finds and declares that the period of usefulness of
the System after completion of the Project will be more than twenty-five (25) years, which is
longer than the term of the Series 2005 Bond.
Section 4: Under the authority of the Constitution and laws of the State of Arkansas,
including particularly Amendment 62 to the Constitution of the State of Arkansas and the Local
Government Bond Act, the City of Fayetteville, Arkansas Sales and Use Tax Capital
Improvement Bond, Series 2005 (the "Series 2005 Bond"), is hereby authorized to be issued in
the total principal amount of not to exceed Sixty-Five Million Dollars ($65,000,000), the
proceeds of the sale of which are necessary to provide sufficient funds to pay a portion of the
costs of accomplishing the Project, including, without limitation, engineering fees, legal fees and
other necessary expenses incidental to accomplishment of the Project, and to the issuance of the
Series 2005 Bond.
The Series 2005 Bond shall bear interest at the rate of two percent (2.00%) per annum
and shall be subject to a Servicing Fee of one percent (1 .00%) per annum based upon a 360-day
year of twelve consecutive 30-day months compounded semiannually. The Series 2005 Bond
shall be dated the date of its delivery to the Bondholder. Accrued interest and the Servicing Fee
only shall be payable on each April 15 and October 15, commencing October 15, 2005, to and
including October 15, 2008. Principal, interest and the Servicing Fee shall be payable on
April 15, 2009, and on each April 15 and October 15 thereafter until the unpaid principal is paid
in full as follows:
Date Payment Amount Interest Servicing Fee Principal
April 15, 2009 $3,785,973 .00 $6505000.00 $3255000.00 $25810,973 .00
October 15, 2009 35785,973 .00 621 ,890.00 310,945.00 2,8539138.00
April 15, 2010 35785,973 .00 593,359.00 296,679.00 2,895,935.00
October 15, 2010 39785,973 .00 5645400.00 2829200.00 2,939,373.00
April 15, 2011 3,7853973 .00 535,006.00 2675503.00 2,983,464.00
Date Payment Amount Interest Servicing Fee Principal
3
• i
October 15, 2011 3,7855973 .00 505, 171 .00 252,586.00 3,0289216.00
April 15, 2012 397855973 .00 474,889.00 237,445.00 39073,639.00
October 15, 2012 33785,973 .00 444, 153.00 2225076.00 39119,744.00
April 15, 2013 35785,973.00 412,955.00 206,478.00 3, 166,540.00
October 15, 2013 397855973 .00 3819290.00 190,645 .00 3,2145038.00
April 15, 2014 35785,973 .00 3495149.00 174,575.00 3,2625249.00
October 15, 2014 3,785,973.00 3169527.00 158,263 .00 313115183.00
April 15, 2015 3 ,7855973 .00 283,415.00 1419708.00 333605850.00
October 15, 2015 39785,973.00 2495807.00 124,903 .00 3,4111263.00
April 15, 2016 3 ,7853973 .00 215,694.00 1079847.00 33462,432.00
October 15, 2016 3,785,973.00 181 ,070.00 90,535.00 3,514,368.00
April 15, 2017 3,785,973 .00 145,926.00 72,963 .00 35567,084.00
October 15, 2017 3,785,973.00 110,255.00 555128.00 35620,590.00
April 15, 2018 3,785,973 .00 74,049.00 37,025.00 3,6749899.00
October 15, 2018 3 ,785,972.00 37,300.00 185650.00 397305022.00
The Series 2005 Bond shall be issued in the form of a single typewritten bond, registered
as to both principal and interest, payable to the Bondholder, or registered assigns, as set forth
hereinafter in the bond form, and shall be numbered R05- 1 .
Payment of principal and interest shall be by check or draft mailed by Simmons First
Trust Company, N.A., as trustee in connection with the Series 2004 Bonds (the "Trustee"), to the
Bondholder at its address shown on the registration books of the City which shall be maintained
by the City Clerk as Bond Registrar, without presentation or surrender of the Series 2005 Bond
(except upon final payment), and such payments shall discharge the obligation of the City to the
extent thereof The City Clerk or her designee shall keep a payment record and make proper
notations thereon of all payments of principal and interest.
Payment of principal and interest shall be in any coin or currency of the United States of
America which, as at the time of payment, shall be legal tender for the payment of debts due the
United States of America. When the principal of and interest on the Series 2005 Bond has been
fully paid, it shall be delivered to the City Clerk and shall be canceled.
Section 5 : The Series 2005 Bond shall be executed on behalf of the City by its Mayor
and City Clerk, and shall have impressed thereon the seal of the City. In order to pay the
principal of and interest on the Series 2005 Bond and the Servicing Fee in connection therewith,
there is hereby pledged all of the receipts of the Sales and Use Tax levied by the Election
Ordinance. As permitted under the Trust Indenture dated as of June 1 , 2002, as amended (the
"Indenture"), securing the Series 2004 Bonds, such pledge is made on a parity basis with the
4
r i
existing pledge of receipts of the Sales and Use Tax securing the payment of the Series 2004
Bonds. The levy and collection of the Sales and Use Tax shall continue until such time as the
Series 2004 Bonds and the Series 2005 Bond are no longer outstanding or sufficient funds are on
deposit with the Trustee under the Indenture to redeem the Series 2004 Bonds and the Series
2005 Bond in full. The City covenants and agrees that all receipts from the Sales and Use Tax
will be accounted for separately as special funds on the books of the City, and receipts of said
Sales and Use Tax will be deposited and will be used solely as provided herein and in the
Indenture. The Series 2005 Bond is not a general obligation of the City but is a special
obligation, the principal of and the interest on which, and the Servicing Fee in connection
therewith, are secured by a pledge of the receipts from the Sales and Use Tax. The principal of
and interest on the Series 2005 Bond shall not constitute an indebtedness of the City within the
meaning of any constitutional or statutory debt limitation or restriction.
Section 6: The Series 2005 Bond shall be in substantially the following form, and the
Mayor and City Clerk are hereby authorized and directed to make all the recitals contained
therein:
Registered United States of America Registered
No. R05-1 $653000,000
State of Arkansas
County of Washington
City of Fayetteville, Arkansas
Sales and Use Tax Capital Improvement Bond
Series 2005
Registered Owner: ARKANSAS DEVELOPMENT FINANCE AUTHORITY
Principal Amount: SIXTY-FIVE MILLION DOLLARS
Know All Men By These Presents:
That the City of Fayetteville, Arkansas (the "City") hereby acknowledges itself to owe,
and for value received promises to pay to the order of the Arkansas Development Finance
Authority, or registered assigns, but solely from the special fund provided therefor as hereinafter
set forth, in lawful money of the United States of America, the Principal Amount shown above
(or so much of the Principal Amount as should have been advanced as shown on the Record of
Payment of Advances attached hereto), and to pay in like coin or currency interest thereon at the
rate of 2.00% per annum from the date of each advance. A servicing fee of 1 .00% per annum
(the "Servicing Fee") shall also be payable by the City to the Arkansas Development Finance
Authority or its successor in the same manner and upon the same dates as interest hereon.
Interest on the unpaid balance of the total principal amount outstanding and the Servicing
Fee shall be payable on October 15, 2005, April 15, 2006, October 15, 2006, April 15, 2007,
October 15, 2007, April 15, 2008 and October 15, 2008. Principal, interest and the Servicing Fee
shall be payable on April 15, 2009, and on each April 15 and October 15 thereafter until the
unpaid principal is paid in full as follows:
5
[Here will be inserted the amortization schedule
set forth in Section 4 of this Ordinance.]
Payments of principal and interest due hereon shall be made, except for final payment,
without presentation and surrender of this bond, directly to the Registered Owner at its address
shown on the registration book of the City maintained by the City Clerk as Bond Registrar, and
such payments shall fully discharge the obligation of the City to the extent of the payments so
made.
This bond is issued for the purpose of (i) providing, financing for a portion of the costs of
planning, designing, acquiring, constructing and equipping of a new wastewater treatment
facility and related sewerage improvements to serve the western portion of the City (the
"Project"), and (ii) paying costs of authorizing and issuing this bond, and is issued pursuant to
and in full compliance with the Constitution and laws of the State of Arkansas, including
particularly Amendment No. 62 to the Constitution of the State of Arkansas ("Amendment 62")
and the Local Government Bond Act, codified as Arkansas Code Annotated Sections 14- 164-301
et seq. ( 1998 Repl. & 2003 Supp.) (the "Act"), and pursuant to Ordinance No.,, y '718 of the
City, duly adopted and approved on the _% day of. , dy , 2005 (the "Authorizing Ordinance").
Reference is hereby made to the Authorizing Ordinance f r the details of the nature and extent of
the security and of the rights and obligations of the City and the Registered Owner of this bond.
This bond may be assigned only upon the written approval of the Arkansas Soil and
Water Conservation Commission (the "Commission"), and in order to effect such assignment,
the assignor shall promptly notify the City Clerk by registered mail, and the assignee shall
surrender this bond along with a written assignment and written approval of the Commission to
the City Clerk for transfer on the registration records. Every assignee shall take this bond subject
to all payments and prepayments of principal and interest (as reflected on the Payment Record
maintained by the City Clerk or her designee) prior to such surrender for transfer.
Following payment in full of the City's Sales and Use Tax Capital Improvement Bonds,
Series 2004 (the "Series 2004 Bonds"), the outstanding principal of this bond shall be prepaid by
the City from time to time with receipts of the Sales and Use Tax (defined below) in excess of
amounts needed to make scheduled payments of the principal, interest and Servicing Fee hereon.
Further, on and after October 15, 2014, this bond may be prepaid at the option of the City from
funds from any source, in whole but not in part, at a prepayment price equal to the principal
amount outstanding, plus accrued interest to the prepayment date. Notice of any prepayment,
whether mandatory or optional, shall be given to the registered owner of this bond at least 90
days prior to the prepayment date. Such notice shall be in writing mailed to the address of the
registered owner of this bond at the address appearing on the bond registration records
maintained by the City Clerk.
This bond does not constitute an indebtedness of the City or the State of Arkansas within
the meaning of any constitutional or statutory limitation or provision, and, except with respect to
receipts generated from the Sales and Use Tax, the taxing power of the City is not pledged to the
payment of the principal of and interest on this bond.
6
This bond is not a general obligation of the City, but is a special limited obligation
payable solely from the receipts of a special City-wide sales and use tax levied at the rate of
three-quarters of one percent (0.75%) pursuant to the Local Government Bond Act (the "Sales
and Use Tax"). In this regard, the pledge of Sales and Use Tax receipts is made on a parity basis
with the prior pledge of such receipts securing the City's Sales and Use Tax Capital
Improvement Bonds, Series 2004 (the "Series 2004 Bonds"). Pursuant to the Trust Indenture
dated as of June 1 , 2002, as amended (the "Indenture), under which the Series 2004 Bonds are
issued and secured, an amount of Sales and Use Tax receipts sufficient to pay principal and
interest on this bond as due shall be set aside monthly in a special fund created for that purpose
identified as the Bond Fund. Reference is made to the Indenture for a detailed statement of the
nature and extent of the security, and the rights and obligations of the City and registered owner
of this bond.
This bond is issued with the intent that the laws of the State of Arkansas will govern its
construction.
No recourse shall be had for the payment of the principal of or premium, if any, or
interest on this bond or for any claim based thereon or upon any obligation, covenant, or
agreement contained in this bond or in the Authorizing Ordinance against any past, present or
future alderman, officer or employee of the City, or any alderman, officer or employee of any
successor of the City, as such, either directly or through the City or any successor of the City,
under any rule of law or equity, statute, or constitution or by the enforcement of any assessment
or penalty or otherwise, and all such liability of any such alderman, officer or employee as such
is hereby expressly waived and released as a condition of and consideration for the issuance of
this bond.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions
and things required by the Constitution and statutes of the State of Arkansas to exist, happen and
be performed precedent to and in the issuance of this bond do exist, have happened and have
been performed in due time, form and manner as required by law; that the indebtedness
represented by this bond does not exceed or violate any constitutional or statutory limitation of
indebtedness; and that provision has been made for the payment of the principal of and interest
on this bond, as provided in the Authorizing Ordinance.
IN WITNESS WHEREOF, the City of Fayetteville, Arkansas has caused this bond to
be executed in its name by the manual signatures of its Mayor and City Clerk, thereunto duly
authorize, and its corporate seal to be affixed hereto, all as of the 5k day of
2005 .
CITY OF FAYETTEVILLE,
ARKANSAS
By:
DA COODY, Mayor
7
ATTEST: = ; FAYETTEVILLE ;
SON RA SMITH, City lerk
REGISTRATION CERTIFICATE
Date of Registration Name of Registered Owner Signature of City Clerk
Arkansas Development
Finance Authority
RECORD OF PAYMENT OF ADVANCES
Signature of Vice
President of Arkansas
* Total Principal Development Finance
Date of Advance Amount of Outstanding Authority
Advance
8
*The date of each advance shall be the interest commencement date from which the
principal amount of such advance bears interest and from which the Servicing Fee is calculated.
Section 7. All of the terms and provisions of the Indenture, as now in effect, except
for those provisions clearly inapplicable hereto or in direct conflict herewith, including, without
limitation, those terms and provisions pertaining to the receipt, investment and handling of Sales
and Use Tax receipts, are hereby made applicable hereto and incorporated by reference as though
fully set forth herein. The effect of the foregoing sentence shall be to continue the applicable
provisions in full force and effect until the Series 2005 Bond is paid, or provision made therefor,
even after payment of the Series 2004 Bonds.
Section 8. The City shall assure that (i) not in excess of 10% of the proceeds of the
Series 2005 Bond is used for Private Business Use (as defined below) if, in addition, the payment
of more than 10% of the principal or 10% of the interest due on the Series 2005 Bond during the
term thereof are, under the terms of the Series 2005 Bond 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 are 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) that, in the event that both (A) in excess of
5% of the proceeds of the Series 2005 Bond are used for a Private Business Use, and (B) an
amount in excess of 5% of the principal or 5% of the interest due on the Series 2005 Bond during
the term thereof are, under the terms of the Series 2005 Bond 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 are 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 5%
of proceeds of the Series 2005 Bond used for a Private Business Use shall be used for a Private
Business Use related to the governmental use of the Project.
The City shall assure that not in excess of 5% of the proceeds of the Series 2005 Bond are
used, directly or indirectly, to make or finance a loan to persons other than state or local
governmental units.
As used in this Section, "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.
Section 9: Installments of principal and interest on the Series 2005 Bond shall be
prepayable prior to maturity as provided in the form of the Series 2005 Bond set forth in Section
5 of this Ordinance.
Section 10: So long as the Series 2005 Bond is outstanding, the City shall not issue or
attempt to issue any bonds or other indebtedness having or claimed to be entitled to a pledge of
the Sales and Use Tax receipts on a priority or panty basis with the lien thereon securing the
Series 2004 Bonds and the Series 2005 Bond.
9
Section 11 : It is covenanted and agreed by the City with the Bondholder and the
Commission that it will faithfully and punctually perform all duties with reference to the System
required by the Constitution and laws of the State of Arkansas and by this Ordinance, including,
without limitation, the making and collecting of reasonable and sufficient rates lawfully
established for services rendered by the System and the segregating of System revenues.
The City covenants and agrees that the Bondholder shall have the protection of all the .
provisions of the Local Government Bond Act, the Indenture and this Ordinance, and that the
City will diligently proceed to enforce those provisions to the end of the Bondholder realizing
fully upon its security. If the City shall fail to proceed within thirty (30) days after written
request shall have been filed by the Bondholder or the Commission, the Bondholder or the
Commission may proceed to enforce all such provisions.
If there be any default in the payment of the principal of or interest on the Series 2005
Bond, or if the City defaults in any Bond Fund requirement described in the Indenture or in the
performance of any of the other covenants contained in this Ordinance or in the Bond Purchase
Agreement, the Bondholder and the Commission (with respect to covenants contained in the
Bond Purchase Agreement) may, by proper suit, compel the performance of the duties of the
officials of the City under the laws of the State of Arkansas. No remedy herein conferred upon
or reserved to the Bondholder is intended to be exclusive of any other remedy or remedies herein
provided or provided by law, and every such remedy shall be cumulative and shall be in addition
to every other remedy given hereunder or given by law. No delay or omission of the Bondholder
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 default or an acquiescence therein; and every power and
remedy given by this Ordinance to the Bondholder may be exercised from time to time and as
often as may be deemed expedient.
No waiver of any default shall extend to or affect . any other existing or any subsequent
default or defaults or impair any rights or remedies consequent thereon. Any costs of
enforcement of the Series 2005 Bond or of any provision of this Ordinance, including reasonable
attorney' s fees, shall be paid by the City. The Bondholder may enforce all rights and exercise all
remedies available to the Bondholder in the event the Servicing Fee is not paid when due.
Section 12: When the Series 2005 Bond has been executed by the Mayor and City
Clerk and the seal of the City impressed thereon as herein provided, it shall be delivered to the
Bondholder upon the payment of all or a portion of the purchase price in accordance with the
Bond Purchase Agreement. The purchase price shall be deposited, as and when received, in a
special account of the City hereby created in a bank that is a member of the Federal Deposit
Insurance Corporation and designated the "2005 Wastewater Construction Fund" (the
"Construction Fund"). The moneys in the Construction Fund shall be used for accomplishing the
Project, paying expenses incidental thereto and paying the expenses of issuing the Series 2005
Bond approved in accordance with the Bond Purchase Agreement. Payments from the
Construction Fund shall be by check or voucher signed by the City Clerk or her designee, and
drawn on the depository. Each such check or voucher shall briefly specify the purpose of the
expenditure.
10
When the Project has been completed and 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 be evidenced by a certificate signed by the City Clerk or
her designee, and by the consulting engineer, which certificate shall state, among other things,
the date of the completion and that all obligations payable from the Construction Fund have been
discharged. A copy of the certificate shall be filed with the depository bank, the Bondholder and
the Commission.
Disbursements shall be made by the Bondholder for costs of the Project pursuant to
written Disbursement Requests as provided in the Bond Purchase Agreement.
Section 13 : The terms and provisions of this Ordinance shall constitute a binding
contract among the City, the Bondholder and the Commission, and no variation or change in the
undertaking herein set forth shall be made while the Series 2005 Bond is outstanding unless
consented to in writing by the Bondholder and the Commission.
Section 14: The City covenants and agrees that it will maintain the System in good
condition and operate it in an efficient manner and at reasonable cost. The City agrees to keep
proper records, books and accounts relating to the operation of the System, which shall be kept
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 in accordance with
generally accepted government accounting standards. Such books shall be available for
inspection by the Bondholder and the Commission, or the agent or the representative of either, at
reasonable times and under reasonable circumstances. The City agrees to have these records
audited annually. If requested, the City agrees to furnish the audit report with respect to the
System to the Bondholder and the Commission.
The City also agrees that it will furnish to the Bondholder and the Commission on or
before 30 days after the end of each fiscal year, if requested, a statement showing (i) total
receipts of the Sales and Use Tax during such fiscal year, (ii) the application of such receipts to
pay the principal of and interest on the Series 2004 Bonds, and (iii) the application of such
receipts to pay the principal of and the interest on the Series 2005 Bond and the Servicing Fee
with respect thereto.
Section 15 : The City agrees that the Bondholder may pledge the Series 2005 Bond as
security for the payment of its wastewater system revolving loan fund revenue bonds (the
"ADFA Bonds"), and the trustee or municipal bond insurer for the ADFA Bonds may exercise
any rights or remedies available to the Bondholder under this Ordinance or the Bond Purchase
Agreement while the Series 2005 Bond is pledged and/or the ADFA Bonds are insured. In
addition, the City agrees that while the Series 2005 Bond is pledged and/or the ADFA Bonds are
insured, copies of all financial information relating to the City, the System and the Sales and Use
Tax receipts shall be furnished to the trustee and/or the municipal insurer for the ADFA Bonds.
Section 16: The Mayor and City Clerk, for and on behalf of the City, are hereby
authorized and directed to do any and all things necessary to effect the issuance, sale, execution
and delivery of the Series 2005 Bond and to effect the execution and delivery of the Bond
Purchase Agreement, and to perform all of the obligations of the City under and pursuant thereto.
11
The Mayor and the City Clerk are further authorized and directed, for and on behalf of the City,
to execute all papers, documents, certificates and other instruments that may be required for the
carrying out of such authority or to evidence the exercise thereof.
Section 17: Kutak Rock LLP, Little Rock, Arkansas, is hereby appointed to act as
Bond Counsel on behalf of the City in connection with the issuance and sale of the Series 2005
Bond.
Section 18 : The provisions of this Ordinance are hereby declared to be severable, and
if any section, phrase or provision shall for any reason be declared to be illegal or invalid, such
declaration shall not affect the validity of the remainder of the sections, phrases or provisions of
this Ordinance.
Section 19: All ordinances, resolutions and parts thereof in conflict herewith are
hereby repealed to the extent of such conflict.
PASSED and APPROVED this 5 h day of July, 2005 .
APPROVED:
' U@ FAYETTEVILLE : By:
�: •� DA GOODY, Mayor
%ys .9QkANSpC.�Jia:
ATTEST:
GT ONv%�%�0 .�`
ji
By: ebAJA0 V
SONDRA SMITH, City Clerk
12