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HomeMy WebLinkAboutOrdinance 4768 ORDINANCE NO, 4768 AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF THE CITY' S NOT TO EXCEED ( 1 ) $27,0007000 OF SALES AND USE TAX REFUNDING AND CAPITAL IMPROVEMENT BONDS, SERIES 2005A, AND (2) $6590009000 OF SALES AND USE TAX CAPITAL IMPROVEMENT BONDS, SERIES 2005B, FOR THE PURPOSE OF REFUNDING THE CITY' S OUTSTANDING SALES AND USE TAX CAPITAL IMPROVEMENT BONDS, SERIES 2004, AND FINANCING A PORTION OF THE COST OF IMPROVEMENTS TO THE CITY' S WASTEWATER TREATMENT, SEWERAGE AND RELATED FACILITIES; AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE PURSUANT TO WHICH THE SERIES 2005 BONDS WILL BE ISSUED AND SECURED; AUTHORIZING THE EXECUTION AND DELIVERY OF AN OFFICIAL STATEMENT PURSUANT TO WHICH THE SERIES 2005 BONDS WILL BE OFFERED; AUTHORIZING THE EXECUTION AND DELIVERY OF A BOND PURCHASE AGREEMENT PROVIDING FOR THE SALE OF THE SERIES 2005 BONDS; AUTHORIZING THE EXECUTION AND DELIVERY OF A CONTINUING DISCLOSURE AGREEMENT; AUTHORIZING THE EXECUTION AND DELIVERY OF AN ESCROW DEPOSIT AGREEMENT PROVIDING FOR THE DEFEASANCE AND REDEMPTION OF THE SERIES 2004 BONDS; 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, reconstruction, extension, improving and equipping of wastewater treatment plants, sewerage and related facilities (the "Project"); 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 . & 2005 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 1 Government Bond Act to finance all or a portion of the Project 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 ( 1 ) its $25,000,000 Sales and Use Tax Capital Improvement Bonds, Series 2002 (the "Series 2002 Bonds"), and (2) 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 initial portions of the Project; and WHEREAS, the Series 2002 Bonds have been paid in full from Sales and Use Tax Receipts and the Series 2004 Bonds are presently outstanding in the aggregate principal amount of $34,250,000; 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, the City has now determined to issue and sell (1 ) its Sales and Use Tax Refunding and Capital Improvement Bonds, Series 2005A, in principal amount not to exceed $27,000,000 (the "Series 2005A Bonds"), and (2) its Sales and Use Tax Capital Improvement Bonds, Series 2005B, in principal amount not to exceed $65,000,000 (the "Series 2005B Bonds") in order to defease all of the outstanding Series 2004 Bonds and to provide additional funding for portions of the Project; and WHEREAS, the Series 2005A Bonds and the Series 2005B Bonds will be issued and secured by the Sales and Use Tax receipts on a parity basis; and WHEREAS, the City has made arrangements for the sale of the Series 2005 Bonds to Stephens Inc., Fayetteville, Arkansas (the "Underwriter"), pursuant to the terms of a Bond Purchase Agreement between the City and the Underwriter (the "Bond Purchase Agreement') in substantially the form presented to and before this meeting; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1 : 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, there is hereby authorized the issuance of bonds of the City to be designated as ( 1 ) "Sales and Use Tax Refunding and Capital Improvement Bonds, Series 2005A" (the "Series 2005A Bonds"), and (2) "Sales and Use Tax Capital Improvement Bonds, Series 200513" (the "Series 2005B Bonds"). The Series 2005A Bonds shall be issued in the original aggregate principal amount of not to exceed Twenty-Seven Million Dollars ($27,000,000), shall 2 0 0 mature not later than December 1 , 2011 , and shall bear interest at the rates specified in the Bond Purchase Agreement. The Series 2005B Bonds shall be issued in the original aggregate principal amount of not to exceed Sixty-Five Million Dollars ($65,000,000), shall mature not later than December 1 , 2019, and shall bear interest at the rates specified in the Bond Purchase Agreement. The true interest cost of the Series 2005 Bonds to the City, including the interest rates home by the Series 2005 Bonds and the costs of issuance funded with proceeds of the Series 2005 Bonds, will not exceed 4.00% per annum, and no Series 2005 Bond will bear a coupon interest rate in excess of 4.00% per annum. The proceeds of the Series 2005 Bonds will be utilized (i) to defease the Series 2004 Bonds, (ii) to finance a portion of the cost of the acquisition, construction, reconstruction, extension, improving and equipping of the Project, (iii) to establish a debt service reserve for the Series 2005 Bonds or to purchase a surety bond for reserve purposes, (iv) to pay premiums for bond insurance, if deemed economically beneficial, and (v) to pay printing, underwriting, legal and other expenses incidental to the issuance of the Series 2005 Bonds. The Series 2005 Bonds shall be issued in the forms and denominations, shall be dated, shall be numbered, shall mature, shall be subject to redemption prior to maturity, and shall contain such other terms, covenants and conditions, all as set forth in that certain Trust Indenture dated as of November 1 , 2005 (the "Indenture"), by and between the City and Simmons First Trust Company, N.A., as trustee (the "Trustee"), to be entered into by the City and the Trustee in substantially the form submitted to this meeting. The Mayor is hereby authorized and directed to execute and deliver the Series 2005A Bonds and the Series 2005B Bonds, each series to be in substantially the form thereof contained in the Indenture submitted to this meeting, and the City Clerk is hereby authorized and directed to execute and deliver the Series 2005A Bonds and the Series 2005B Bonds and to affix the seal of the City thereto, and the Mayor and City Clerk are hereby authorized and directed to cause the Series 2005A Bonds and the Series 2005B Bonds to be accepted and authenticated by the Trustee. The Mayor is hereby authorized to confer with the Trustee, the Underwriter and Kutak Rock LLP, Little Rock, Arkansas ("Bond Counsel'), in order to complete the Series 2005A Bonds and the Series 2005B Bonds in substantially the form thereof contained in the Indenture submitted to this meeting, with such changes as shall be approved by such persons executing the Series 2005A Bonds and the Series 2005B Bonds, their execution to constitute conclusive evidence of such approval. Section 2: In order to pay the principal of and interest on the Series 2005 Bonds as they mature or are called for redemption prior to maturity, there is hereby pledged all of the receipts of the Sales and Use Tax levied by the Election Ordinance. As permitted under the Indenture, such pledge is made on a parity basis as to the Series 2005A Bonds and the Series 2005B Bonds. The levy and collection of the Sales and Use Tax shall continue until such time as the Series 2005 Bonds are no longer outstanding or sufficient funds are on deposit with the Trustee under the Indenture to redeem the Series 2005 Bonds 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 in the Indenture. Section 3 : To prescribe the terms and conditions upon which the Series 2005 Bonds are to be executed, authenticated, issued, accepted, held and secured, the Mayor is hereby authorized 3 and directed to execute and acknowledge the Indenture, and the City Clerk is hereby authorized and directed to execute and acknowledge the Indenture and to affix the seal of the City thereto, and the Mayor and the City Clerk are hereby authorized and directed to cause the Indenture to be accepted, executed and acknowledged by the Trustee. The Indenture is hereby approved in substantially the form submitted to this meeting, including, without limitation, the provisions thereof pertaining to the pledge of Sales and Use Tax receipts and the terms of the Series 2005 Bonds. The Mayor is hereby authorized to confer with the Trustee, the Underwriter and Bond Counsel in order to complete the Indenture in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Indenture, their execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Indenture in substantially the form authorized to be executed is on file with the City Clerk and is available for inspection by any interested person.) Section 4: There is hereby authorized and approved a Preliminary Official Statement of the City, including the cover page and appendices attached thereto, relating to the Series 2005 Bonds. The Preliminary Official Statement is hereby "deemed final" by the City within the meaning of U.S. Securities and Exchange Commission Rule 15c2- 12. The distribution of the Preliminary Official Statement is hereby approved. The Preliminary Official Statement, as amended to conform to the terms of the Bond Purchase Agreement, including Exhibit A thereto, and with such other changes and amendments as are mutually agreed to by the City and the Underwriter, is herein referred to as the "Official Statement," and the Mayor is hereby authorized to execute the Official Statement for and on behalf of the City. The Official Statement is hereby approved in substantially the form of the Preliminary Official Statement submitted to this meeting, and the Mayor is hereby authorized to confer with the Trustee, the Underwriter and Bond Counsel in order to complete the Official Statement in substantially the form of the Preliminary Official Statement submitted to this meeting, with such changes as shall be approved by such persons, the Mayor' s execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Preliminary Official Statement is on file with the City Clerk and is available for inspection by any interested person.) Section 5 : In order to prescribe the terms and conditions upon which the Series 2005 Bonds are to be sold to the Underwriter, the Mayor is hereby authorized and directed to execute a Bond Purchase Agreement on behalf of the City, to be dated as of the date of its execution (the "Bond Purchase Agreement"), by and between the City and the Underwriter, and the Bond Purchase Agreement is hereby approved in substantially the form submitted to this meeting, and the Mayor is hereby authorized to confer with the Underwriter and Bond Counsel in order to complete the Bond Purchase Agreement in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Bond Purchase Agreement, their execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Bond Purchase Agreement in substantially the form authorized to be executed is on file with the City Clerk and is available for inspection by any interested person.) 4 0 0 Section 6: In order to provide for continuing disclosure of certain financial and operating information with respect to the Sales and Use Tax and the City in compliance with the provisions of Rule 15c2- 12 of the U. S. Securities and Exchange Commission, the Mayor is hereby authorized and directed to execute a Continuing Disclosure Agreement to be dated as of the date of its execution (the "Continuing Disclosure Agreement"), by and between the City and the Trustee, and the Mayor is hereby authorized and directed to cause the Continuing Disclosure Agreement to be executed by the Trustee. The Continuing Disclosure Agreement is hereby approved in substantially the form submitted to this meeting, and the Mayor is hereby authorized to confer with the Trustee, the Underwriter and Bond Counsel in order to complete the Continuing Disclosure Agreement in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Continuing Disclosure Agreement, their execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Continuing Disclosure Agreement in substantially the form authorized to be executed is on file with the City Clerk and is available for inspection by any interested person.) Section 7: In order to provide for the defeasance and redemption of the Series 2004 Bonds, the Mayor is hereby authorized and directed to execute an Escrow Deposit Agreement to be dated as of the date of its execution (the "Escrow Agreement'), by and between the City and Simmons First Trust Company, N.A., as escrow trustee (the "Escrow Trustee"), and the Mayor is hereby authorized and directed to cause the Escrow Agreement to be executed by the Escrow Trustee. The Escrow Agreement is hereby approved in substantially the form submitted to this meeting, and the Mayor is hereby authorized to confer with the Underwriter, the Escrow Trustee and Bond Counsel in order to complete the Escrow Agreement in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Escrow Agreement, their execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Escrow Agreement in substantially the form authorized to be executed is on file with the City Clerk and is available for inspection by any interested person.) Section 8 : In order to secure lower interest rates on the Series 2005A Bonds and the Series 2005B Bonds, the Underwriter has proposed that the City consider the purchase of a policy or policies of bond insurance with a portion of the proceeds of the Series 2005 Bonds, which policy or policies would guarantee the payment of the principal of and interest on the Series 2005 Bonds when due. If deemed economically advantageous by the Mayor, upon the advice of the Underwriter, the Mayor is hereby authorized to execute an insurance commitment and to do any and all things necessary to accomplish the delivery of a bond insurance policy or policies with respect to the Series 2005 Bonds. In order to that the maximum amount of proceeds of the Series 2005 Bonds be available to pay costs of the Project, the Underwriter has proposed that the City consider the purchase of a surety bond or bonds with a portion of the proceeds of the Series 2005 Bonds, which surety bond or bonds would satisfy the funding requirements of the debt service reserve. If deemed economically advantageous by the Mayor, upon the advice of the Underwriter, the Mayor is 5 0 hereby authorized to execute a commitment and to do any and all things necessary to accomplish the delivery of a surety bond or bonds with respect to the debt service reserve for the Series 2005 Bonds. Section 9: 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 Bonds and to effect the execution and delivery of the Indenture, the Bond Purchase Agreement, the Official Statement, the Continuing Disclosure Agreement, the Escrow Agreement and a Tax Regulatory Agreement relating to the tax exemption of interest on the Series 2005 Bonds, and to perform all of the obligations of the City under and pursuant thereto. 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 10: 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 Bonds. Section 11 : 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 12 : Upon the issuance and delivery of the Series 2005 Bonds, Ordinance No. 4718, adopted and approved by the City Council on July 5, 2005, will be deemed to be repealed. All other ordinances, resolutions and parts thereof in conflict herewith are hereby repealed to the extent of such conflict. PASSED and APPROVED this 4`h day of October, 2005. APPRO D: By: &Xz�� DAN COODY, Mayor ATTEST: .� Eq By �`�G•0&1 Y �0,o SO DRA SMITH, City Clerk & a• •�;P� _ ; FAYETTEVILLE ; �9S�9;P�fAN54:�' '� GT01`1 GO 6 City of Fayetteville ` 00 Staff Review Form City Council Agenda Items ql�2 or Contracts 4-Oct-05 City Council Meeting Date Stephen Davis FIS Director Finance & Internal Services Submitted By Division Department Action Required: Approval of a bond ordinance authorizing the Mayor to execute a bond purchase agreement authorizing the issuance of up-to $27 million in Sles and Use Tax Refunding and Capital Improvement Bonds to be used to fund a portion of the costs associated with the Wastewater System Improvements Project (West-sideTreatment Plant) and authorize City Staff to prepare the required budget amendments/payments to implement the bond purchase agreement. ebt Service Funded By a Dedicated 3/4% Sales & Use Tax WSIP Cost of this request Category/Project Budget Program Category / Project Name Account Number Funds Used to Date Program / Project Category Name $ Wastewater Construction Improvement Project Number Remaining Balance Fund Name Budgeted Item Budget Adjustment Attached 4624, 4389 & a Previous Ordinance or Resolution # 43270jJ gllr DepaFtment Iffirector Date Original Contract Date: Original Contract Number: City Attorney / Received in City Clerk's Office Financec nod Internal Service Director Date Received in Mayor's Office Mayor Date Comments: FAYETTEALLE THE CITY OF FAYETTEVILLE. ARKANSAS DEPARTMENTAL CORRESPONDENCE TO: Mayor Coody and Fayetteville City Council FROM: Stephen Davis, Finance & Internal Services Director/ DATE: September 21 , 2005 //��777777��'���-�� SUBJECT: Bond Ordinance - Wastewater System Improvements Project Sales & Use Tax Refunding and Capital Improvement Bonds 2005A Recommendation Approval of a bond ordinance authorizing the Mayor to execute a bond purchase agreement authorizing the City to issue refunding bonds in the amount of$27 million and capital improvements bonds in the amount of $65 million to be used to fund a portion of the costs associated with the Wastewater System Improvements Project (West-side Treatment Plant and associated Lines/Lift Stations) and authorize City Staff to prepare the required budget amendments/payments to implement the bond purchase agreement. Background/Discussion Fayetteville citizens by public vote authorized the issuance of up-to $ 125 million in sales tax backed bonds to fund the projects costs associated with the WSIP improvements. This request will utilize the remaining voter authorization for the sales tax backed bond issues. Budget Impact The annual debt service cost is included in the City's Adopted Budget. ORDINANCE NO, AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF THE CITY' S NOT TO EXCEED ( 1 ) $273000,000 OF SALES AND USE TAX REFUNDING AND CAPITAL IMPROVEMENT BONDS, SERIES 2005A, AND (2) $65,0009000 OF SALES AND USE TAX CAPITAL IMPROVEMENT BONDS, SERIES 2005B, FOR THE PURPOSE OF REFUNDING THE CITY' S OUTSTANDING SALES AND USE TAX CAPITAL IMPROVEMENT BONDS, SERIES 2004, AND FINANCING A PORTION OF THE COST OF IMPROVEMENTS TO THE CITY'S WASTEWATER TREATMENT, SEWERAGE AND RELATED FACILITIES; AUTHORIZING THE EXECUTION AND DELIVERY OF A TRUST INDENTURE PURSUANT TO WHICH THE SERIES 2005 BONDS WILL BE ISSUED AND SECURED; AUTHORIZING THE EXECUTION AND DELIVERY OF AN OFFICIAL STATEMENT PURSUANT TO WHICH THE SERIES 2005 BONDS WILL BE OFFERED; AUTHORIZING THE EXECUTION AND DELIVERY OF A BOND PURCHASE AGREEMENT PROVIDING FOR THE SALE OF THE SERIES 2005 BONDS; AUTHORIZING THE EXECUTION AND DELIVERY OF A CONTINUING DISCLOSURE AGREEMENT; AUTHORIZING THE EXECUTION AND DELIVERY OF AN ESCROW DEPOSIT AGREEMENT PROVIDING FOR THE DEFEASANCE AND REDEMPTION OF THE SERIES 2004 BONDS; 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, reconstruction, extension, improving and equipping of wastewater treatment plants, sewerage and related facilities (the "Project'); 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. & 2005 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 1 0 0 Government Bond Act to finance all or a portion of the Project 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 ( 1 ) its $25,000,000 Sales and Use Tax Capital Improvement Bonds, Series 2002 (the "Series 2002 Bonds"), and (2) 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 initial portions of the Project; and WHEREAS, the Series 2002 Bonds have been paid in full from Sales and Use Tax Receipts and the Series 2004 Bonds are presently outstanding in the aggregate principal amount of $34,250,000; 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, the City has now determined to issue and sell ( 1 ) its Sales and Use Tax Refunding and Capital Improvement Bonds, Series 2005A, in principal amount not to exceed $27,000,000 (the "Series 2005A Bonds"), and (2) its Sales and Use Tax Capital Improvement Bonds, Series 2005B, in principal amount not to exceed $65,000,000 (the "Series 2005B Bonds," and together with the Series 2005A Bonds, the "Series 2005 Bonds") in order to defease all of the outstanding Series 2004 Bonds and to provide additional funding for portions of the Project; and WHEREAS, the Series 2005A Bonds and the Series 2005B Bonds will be issued and secured by the Sales and Use Tax receipts on a parity basis; and WHEREAS, the City has made arrangements for the sale of the Series 2005 Bonds to Stephens Inc., Fayetteville, Arkansas (the "Underwriter"), pursuant to the terms of a Bond Purchase Agreement between the City and the Underwriter (the "Bond Purchase Agreement') in substantially the form presented to and before this meeting; NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1 : 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, there is hereby authorized the issuance of bonds of the City to be designated as ( 1 ) "Sales and Use Tax Refunding and Capital Improvement Bonds, Series 2005A" (the "Series 2005A Bonds"), and (2) "Sales and Use Tax Capital Improvement Bonds, Series 2005B" (the "Series 2005B Bonds"). The Series 2005A Bonds shall be issued in the original 2 0 0 aggregate principal amount of not to exceed Twenty-Seven Million Dollars ($27,000,000), shall mature not later than December 1 , 2011 , and shall bear interest at the rates specified in the Bond Purchase Agreement. The Series 2005B Bonds shall be issued in the original aggregate principal amount of not to exceed Sixty-Five Million Dollars ($65,000,000), shall mature not later than December 1 , 2019, and shall bear interest at the rates specified in the Bond Purchase Agreement. The true interest cost of the Series 2005 Bonds to the City, including the interest rates bome by the Series 2005 Bonds and the costs of issuance and any bond insurance premium funded with proceeds of the Series 2005 Bonds, will not exceed 4.00% per annum, and no Series 2005 Bond will bear a coupon interest rate in excess of 4.00% per annum. The proceeds of the Series 2005 Bonds will be utilized (i) to defease the Series 2004 Bonds, (ii) to finance a portion of the cost of the acquisition, construction, reconstruction, extension, improving and equipping of the Project, (iii) to establish a debt service reserve for the Series 2005 Bonds or to purchase a surety bond for reserve purposes, (iv) to pay premiums for bond insurance, if deemed economically beneficial, and (v) to pay printing, underwriting, legal and other expenses incidental to the issuance of the Series 2005 Bonds. The Series 2005 Bonds shall be issued in the forms and denominations, shall be dated, shall be numbered, shall mature, shall be subject to redemption prior to maturity, and shall contain such other terms, covenants and conditions, all as set forth in that certain Trust Indenture dated as of November 1 , 2005 (the "Indenture"), by and between the City and Simmons First Trust Company, N.A., as trustee (the "Trustee"), to be entered into by the City and the Trustee in substantially the form submitted to this meeting. The Mayor is hereby authorized and directed to execute and deliver the Series 2005A Bonds and the Series 2005B Bonds, each series to be in substantially the form thereof contained in the Indenture submitted to this meeting, and the City Clerk is hereby authorized and directed to execute and deliver the Series 2005A Bonds and the Series 2005B Bonds and to affix the seal of the City thereto, and the Mayor and City Clerk are hereby authorized and directed to cause the Series 2005A Bonds and the Series 2005B Bonds to be accepted and authenticated by the Trustee. The Mayor is hereby authorized to confer with the Trustee, the Underwriter and Kutak Rock LLP, Little Rock, Arkansas ("Bond Counsel'), in order to complete the Series 2005A Bonds and the Series 2005B Bonds in substantially the form thereof contained in the Indenture submitted to this meeting, with such changes as shall be approved by such persons executing the Series 2005A Bonds and the Series 2005B Bonds, their execution to constitute conclusive evidence of such approval. Section 2: In order to pay the principal of and interest on the Series 2005 Bonds as they mature or are called for redemption prior to maturity, there is hereby pledged all of the receipts of the Sales and Use Tax levied by the Election Ordinance. As permitted under the Indenture, such pledge is made on a parity basis as to the Series 2005A Bonds and the Series 2005B Bonds. The levy and collection of the Sales and Use Tax shall continue until such time as the Series 2005 Bonds are no longer outstanding or sufficient funds are on deposit with the Trustee under the Indenture to redeem the Series 2005 Bonds 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 in the Indenture. 3 Section 3 : To prescribe the terms and conditions upon which the Series 2005 Bonds are to be executed, authenticated, issued, accepted, held and secured, the Mayor is hereby authorized and directed to execute and acknowledge the Indenture, and the City Clerk is hereby authorized and directed to execute and acknowledge the Indenture and to affix the seal of the City thereto, and the Mayor and the City Clerk are hereby authorized and directed to cause the Indenture to be accepted, executed and acknowledged by the Trustee. The Indenture is hereby approved in substantially the form submitted to this meeting, including, without limitation, the provisions thereof pertaining to the pledge of Sales and Use Tax receipts and the terms of the Series 2005 Bonds. The Mayor is hereby authorized to confer with the Trustee, the Underwriter and Bond Counsel in order to complete the Indenture in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Indenture, their execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Indenture in substantially the form authorized to be executed is on file with the City Clerk and is available for inspection by any interested person.) Section 4: There is hereby authorized and approved a Preliminary Official Statement of the City, including the cover page and appendices attached thereto, relating to the Series 2005 Bonds. The Preliminary Official Statement is hereby "deemed final" by the City within the meaning of U.S. Securities and Exchange Commission Rule 15c2- 12. The distribution of the Preliminary Official Statement is hereby approved. The Preliminary Official Statement, as amended to conform to the terms of the Bond Purchase Agreement, including Exhibit A thereto, and with such other changes and amendments as are mutually agreed to by the City and the Underwriter, is herein referred to as the "Official Statement," and the Mayor is hereby authorized to execute the Official Statement for and on behalf of the City. The Official Statement is hereby approved in substantially the form of the Preliminary Official Statement submitted to this meeting, and the Mayor is hereby authorized to confer with the Trustee, the Underwriter and Bond Counsel in order to complete the Official Statement in substantially the form of the Preliminary Official Statement submitted to this meeting, with such changes as shall be approved by such persons, the Mayor' s execution to constitute conclusive evidence of such approval. (Advice is given that a copy of the Preliminary Official Statement is on file with the City Clerk and is available for inspection by any interested person.) Section 5 : In order to prescribe the terms and conditions upon which the Series 2005 Bonds are to be sold to the Underwriter, the Mayor is hereby authorized and directed to execute a Bond Purchase Agreement on behalf of the City, to be dated as of the date of its execution (the "Bond Purchase Agreement"), by and between the City and the Underwriter, and the Bond Purchase Agreement is hereby approved in substantially the form submitted to this meeting, and the Mayor is hereby authorized to confer with the Underwriter and Bond Counsel in order to complete the Bond Purchase Agreement in substantially the form submitted to this meeting, with such changes as shall be approved by such persons executing the Bond Purchase Agreement, their execution to constitute conclusive evidence of such approval. 4