KC Skyline

City Clerk Web Search

Search the Ordinances:

Legislation #: 050906 Introduction Date: 8/4/2005
Type: Ordinance Effective Date: none
Sponsor: None
Title: Authorizing the issuance of not to exceed $30,000,000.00 principal amount of Water Revenue Bonds, Series 2005F, of the City of Kansas City, Missouri, prescribing the form and details of such revenue bonds and the covenants and agreements to provide for the payment and security thereof; and authorizing certain actions and documents and prescribing other matters relating thereto.

Legislation History
DateMinutesDescription
7/25/2005 Filed by the Clerk's office
8/4/2005 Referred to Finance Committee
8/10/2005 Hold On Agenda (8/17/2005)
8/17/2005 Advance and Do Pass as a Committee Substitute, Debate
8/18/2005 Passed as Substituted

View Attachments
FileTypeSizeDescription
050906.pdf Authenticated 3588K Authenticated
fiscal notes-Water ordinance 2005F v1(2).xls Fiscal Note 41K Fiscal Note
2005f Ordinance Water Fact Sheet v2.xls Fact Sheet 42K Fact Sheet

Printer Friendly Version

COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 050906

 

Authorizing the issuance of not to exceed $30,000,000.00 principal amount of Water Revenue Bonds, Series 2005F, of the City of Kansas City, Missouri, prescribing the form and details of such revenue bonds and the covenants and agreements to provide for the payment and security thereof; and authorizing certain actions and documents and prescribing other matters relating thereto.

 

WHEREAS, the City of Kansas City, Missouri (the City) is a constitutional charter City and political subdivision duly organized and existing under the laws of the State of Missouri (the State), and owns and operates a revenue producing waterworks system serving the City and its inhabitants and others within its service area (the System); and

 

WHEREAS, the City desires to make certain extensions and improvements to the System and is authorized under the provisions of the Constitution and statutes of the State and its City Charter to issue and sell revenue bonds for the purpose of providing funds for such purposes, upon obtaining the required voter approval and provided that the principal of and interest on such revenue bonds shall be payable solely from the revenues derived from the operation of the System; and

 

WHEREAS, pursuant to such authority, a special bond election was duly held in the City at the primary election on August 6, 1996 (the Election), on the following question:

 

QUESTION NO. 1

 

Shall the City of Kansas City, Missouri, issue and sell waterworks revenue bonds in the principal amount of $150,000,000.00 for the purpose of extending and improving the waterworks system of the City including (1) the completion of the water main transmission system to all parts of the City, (2) replacement of small water mains, (3) replacement and additions to the water treatment plant and major pump stations, and (4) automation of the system, with the principal and interest of said bonds to be payable solely from the revenues derived by the City from the operation of its waterworks system, including all future improvements and extensions thereto?

 

and it was found and determined that more than a majority of the qualified electors of the City voting on the question had voted in favor of the issuance of the revenue bonds for the purpose aforesaid, the vote on such question having been 28,959 votes for the question to 8,821 votes against the question; and

 

WHEREAS, plans for such extensions and improvements and an estimate of the cost thereof have been prepared and made by the Director of the Department of Water Services of the City and the Consulting Engineer (as defined below) and the same are hereby accepted and approved and are on file in the office of the Director of Water Services, the amount of such estimated cost being not less than $30,000,000; and


WHEREAS, the City has heretofore issued its Water Revenue Bonds, 7th Issue, Series D, dated December 1, 1994, in the original principal amount of $35,000,000 of which $1,690,000 principal amount remains Outstanding; its Water Refunding Revenue Bonds, Series 1996A, in the original principal amount of $45,550,000 of which $20,815,000 principal amount remains Outstanding; its Water Revenue Bonds, Series 1996B, in the original principal amount of $28,000,000 of which $19,960,000 principal amount remains Outstanding; its Water Refunding Revenue Bonds, Series 1998A in the original principal amount of $38,260,000 of which $33,680,000 remains Outstanding; its Water Revenue Bonds, Series 1998B in the original principal amount of $14,410,000 of which $11,415,000 principal amount remains Outstanding; its Water Revenue Bonds, Series 2000A in the original principal amount of $25,000,000 of which $21,275,000 remains Outstanding; its Water Revenue Bonds, Series 2002C, in the original principal amount of $17,500,000 of which $15,960,000 remains Outstanding; and its Water Revenue Bonds, Series 2004D, in the original principal amount of $25,000,000 of which $25,000,000 remains Outstanding; and

 

WHEREAS, it is hereby found and determined that it is necessary and advisable in the best interests of the City and of its inhabitants at this time to authorize the issuance and delivery of $30,000,000 principal amount of Water Revenue Bonds to provide funds for the purpose of extending and improving the waterworks system of the City, as aforesaid; NOW, THEREFORE,

 

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

 

ARTICLE I

DEFINITIONS

 

Section 101. Definitions of Words and Terms. In addition to the words and terms otherwise defined herein, unless the context shall clearly indicate some other meaning, the words and terms as used in this Ordinance shall have the following meanings:

 

2005F Bond Reserve Account means the Water Revenue Bonds, Series 2005F, Reserve Account created pursuant to Section 502 of the Ordinance.

 

2005F Water Debt Fund means the Water Revenue Bonds, Series 2005F, Principal and Interest Sinking Fund created pursuant to Section 502 of the Ordinance.

 

Additional Bonds means any bonds on a parity with the Bonds issued pursuant to and in accordance with Section 902 of this Ordinance.

 

Administrative Service Fees means that portion of the Current System Expenses paid to the general fund of the City for office space and certain administrative, data processing, accounting and other support services provided to the System of the City.

 

Bond Counsel means Gilmore & Bell, P.C., or other attorney or firm of attorneys with a nationally recognized standing in the field of municipal bond financing.

 

Bond Insurance Policy means, with respect to the Series 2005F Bonds, the insurance policy issued by the Bond Insurer guaranteeing the scheduled payment of the principal of and interest on the Series 2005F Bonds when due.


Bond Insurer means Financial Security Assurance Inc., a New York stock insurance company, or any successor thereto or assignee thereof.

 

Bond Payment Date means any date on which principal of or interest on any Bond is payable at Maturity or any Interest Payment Date.

 

Bond Register means the books for registration, transfer and exchange of Bonds kept at the office of the Paying Agent as bond registrar.

 

Bond Reserve Account means, with respect to each Series of Bonds, the account established for deposit and maintenance of the bond reserve requirement, if any, with respect to such Series of Bonds.

 

Bond Reserve Requirement means the amount on the date of original issuance and delivery of the Bonds equal to the least of (a) ten percent (10%) of the stated principal amount of the Bonds, (b) the maximum Debt Service Requirements for the Bonds during any fiscal year or (c) 125% of the average annual Debt Service Requirements for the Bonds over the term of the Bonds. If the aggregate initial offering price of the Bonds to the public is less than 98% or more than 102% of par, such offering price shall be used in clause (a) in lieu of the stated principal amount.

 

Bondowner or Registered Owner when used with respect to any Bond means the Person in whose name such Bond is registered on the Bond Register.

 

Bonds means the Water Revenue Bonds, Series 2005F of the City, in the aggregate principal amount of $30,000,000 authorized and issued pursuant to this Ordinance.

 

Business Day means a day other than a Saturday, Sunday or holiday on which the Paying Agent is scheduled in the normal course of its operations to be open to the public for conduct of its banking operations.

 

Cede & Co. means Cede & Co., as nominee name of The Depository Trust Company, New York, New York.

 

City means the City of Kansas City, Missouri, and any successors or assigns.

 

Code means the Internal Revenue Code of 1986, as amended, and the applicable regulations of the Treasury Department proposed or promulgated thereunder.

 

Consulting Engineer means each independent engineer or engineering firm with experience in designing and constructing waterworks facilities and retained by the City.

 

Council means the City Council of the City.

 

Current System Expenses means all reasonable and necessary expenses of operating and maintaining the System (excluding capital lease payments, if any, and interest paid on water revenue bonds and depreciation and amortization charges) pursuant to Section 601(a) of this Ordinance.


Debt Service Requirements means the aggregate principal payments (whether at maturity or pursuant to scheduled mandatory sinking fund redemption requirements) and interest payments on all Water Revenue Bonds for the period of time for which calculated; provided, however, that for purposes of calculating such amount, principal and interest shall be excluded from the determination of Debt Service Requirements to the extent that such principal or interest is payable from amounts deposit in trust, escrowed or otherwise set aside for the payment thereof with the Paying Agent or other commercial bank or trust company located in the State and having full trust powers.

 

Defaulted Interest means interest on any Bond which is payable but not paid on any Interest Payment Date.

 

Defeasance Obligations means any of the following obligations:

 

(a) United States Government Obligations that are not subject to redemption in advance of their maturity dates; or

 

(b) obligations of any state or political subdivision of any state, the interest on which is excluded from gross income for federal income tax purposes and which meet the following conditions:

 

(1) the obligations are (i) not subject to redemption prior to maturity or (ii) the trustee for such obligations has been given irrevocable instructions concerning their call and redemption and the issuer of such obligations has covenanted not to redeem such obligations other than as set forth in such instructions;

 

(2) the obligations are secured by cash or United States Government Obligations that may be applied only to principal of, premium, if any, and interest payments on such obligations;

 

(3) such cash and the principal of and interest on such United States Government Obligations serving as security for the obligations, plus any cash in the escrow fund, are sufficient to meet the liabilities of the obligations;

 

(4) such cash and United States Government Obligations serving as security for the obligations, are held in an escrow fund by an escrow agent or a trustee irrevocably in trust;

 

(5) such cash and United States Government Obligations serving as security for the obligations, are not available to satisfy any other claims, including those against the trustee or escrow agent; and

 

(6) the obligations are rated in the highest rating category by Moodys Investors Service, Inc. (presently Aaa) and Standard & Poors Ratings Group (presently AAA); or


(c) with the consent of the Bond Insurer, securities eligible for AAA defeasance under then existing criteria of Standard and Poors Ratings Group; or

 

(d) any combination of the foregoing; or

 

(e) Such other securities not described above that are allowed pursuant to Missouri law and approved in writing by the Bond Insurer.

 

Depository means DTC.

 

Director means, in reference to the Department of Water Services of the City, the Director or any Deputy Director of the Department of Water Services of the City, and in reference to the Department of Finance of the City, the Director or any Acting Director of the Department of Finance of the City.

 

DTC means The Depository Trust Company.

 

Fiscal Year means the Citys fiscal year then in effect.

 

Global Bond Certificate means one or more Bond certificates of the City, representing the entire principal amount of a particular Series due on a particular Stated Maturity, immobilized from general circulation in the Depository.

 

Interest Payment Date means the Stated Maturity of an installment of interest on any Bond.

 

Maturity when used with respect to any Bond means the date on which the principal of such Bond becomes due and payable as therein and herein provided; whether at the Stated Maturity thereof or call for optional or mandatory redemption or otherwise.

 

Net Revenues means for the period of determination, the Revenues less Current System Expenses.

 

Ordinance means this Ordinance as from time to time amended.

 

Outstanding means, when used with reference to Bonds, as of any particular date, all Bonds theretofore issued and delivered hereunder, except the following Bonds:

 

(a) Bonds theretofore canceled by the Paying Agent or delivered to the Paying Agent for cancellation;

 

(b) Bonds deemed to be paid in accordance with the provisions of Section 1101; and

 

(c) Bonds in exchange for or in lieu of which other Bonds have been registered and delivered.


Parity Bonds means the Series D Bonds, the Series 1996A Bonds, the Series 1996B Bonds, the Series 1998A Bonds, the Series 1998B Bonds, the Series 2000A Bonds, the Series 2002C Bonds and the Series 2004D Bonds Outstanding on the date of the issuance and delivery of the Bonds.

 

Parity Ordinances means the ordinances heretofore adopted by the City under which the

outstanding Parity Bonds have been issued, and the ordinances under which any additional Parity Bonds are hereafter issued pursuant to Section 902 of this Ordinance.

 

Participants means those financial institutions for whom the Depository effects book-entry transfers and pledges of securities deposited with the Depository.

 

Paying Agent means the paying agent selected from time to time by the Director of Finance.

 

Permitted Investments means any of the following securities, if and to the extent the same are at the time legal for investment of the Citys moneys held in the funds and accounts referred to in Article V:

 

(a) United States Treasury Securities (Bills, Notes, Bonds and Strips) Obligations of the United States government for which the full faith and credit of the United States are pledged for the payment of principal and interest.

 

(b) United States Agency Securities. Obligations issued or guaranteed by any agency, including government sponsored enterprises of the United States Government, which at the time of purchase have a liquid market and a readily determinable market value that are described as follows:

 

(i) U.S. Government Agency Coupon and Zero Coupon Securities. Bullet coupon bonds with no embedded options.

 

(ii) U.S. Government Agency Discount Notes. Purchased at a discount with maximum maturities of one (1) year.

 

 

(iii) U.S. Government Agency Callable Securities. Restricted to securities callable at par only with maximum final maturities of five (5) years.

 

(iv) U.S. Government Agency Step-Up Securities. The coupon rate is fixed for an initial term. At coupon date, the coupon rate rises to a new, higher fixed interest rate. Restricted to securities with maximum final maturities of three (3) years.

 

(v) U.S. Government Agency Floating Rate Securities. The coupon rate floats off of only one index. Restricted to coupons with no interim caps that reset at least quarterly.


(vi) U.S. Government Agency Mortgage Backed Securities (MBS, CMO, Pass-Thru Securities). Restricted to securities with final maturities of three (3) years or less or have the final projected payment no greater than three (3) years when analyzed in a +300 basis point interest rate environment. Restricted to obligations of FNMA, FHLMC and GNMA only.

 

(c) Repurchase Agreements. Contractual agreements between the City and commercial banks or primary government securities dealers, organized under the laws of the United States or any state, which contractual agreements are continuously and fully secured by any one or more of the securities described in paragraphs (a) and (b) above and which have a market value, exclusive of accrued interest, at all times at least equal to the principal amount of such repurchase agreements. Securities acquired pursuant to repurchase agreements shall be valued at the lower of the current market value or the repurchase price thereof set forth in the repurchase agreement. The Bond Market Associations guidelines for the Master Repurchase Agreement will be used and will govern all repurchase agreement transactions. All repurchase agreements shall result in transfer of legal title to identified securities that are segregated in a custodial or trust account for the benefit of the Paying Agent or delivered to the Paying Agent. Repurchase agreement transactions will be either physical delivery or tri-party.

 

(d) Bankers Acceptances. Bankers acceptances issued by domestic commercial banks possessing the highest rating issued by Moodys Investor Services, Inc. or Standard and Poors Corporation.

 

(e) Commercial Paper. Commercial paper issued by domestic corporations, which has received the highest rating issued by Moodys Investor Services, Inc. or Standard and Poors Corporation. Eligible paper is further limited to issuing corporations that have total assets in excess of five hundred million dollars ($500,000,000) and are not listed on Credit Watch with negative implications by any nationally recognized rating agency at the time of purchase.

(f) Any full faith and credit obligations of the State of Missouri rated at least A or A2 by Standard and Poors or Moodys.

 

(g) Any full faith and credit obligations of any county in which the City is located rated AA or Aa2 by Standard and Poors or Moodys.

 

(h) Any full faith and credit obligations of any school district in Kansas City, Missouri rated AA or Aa2 by Standard and Poors or Moodys.

 

(i) Any full faith and credit obligations or revenue bonds of the City of Kansas City, Missouri rated AA or Aa2 by Standard and Poors or Moodys.

 

(j) Any municipal obligation as defined in (f), (g), (h) or (i) that is not rated but either pre-refunded or escrowed to maturity with U.S. Treasury Securities as to both principal and interest.


(k) Money market mutual funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, rated in either of the two highest categories by Moodys and Standard & Poors (in either case without regard to any modifier).

 

(l) Such other investments not described above that are allowed pursuant to Missouri law and approved in writing by the Bond Insurer.

 

References to particular ratings and rating categories in this definition are applicable only at the time of purchase of the Permitted Investment.

 

Person means any natural person, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof or other public body.

 

Project means the extensions and improvements of the Citys waterworks system, as approved by the voters of the City at the election held on August 6, 1996.

 

Project Fund means the fund by that name created by Section 502 of this Ordinance.

 

Purchaser means the original purchaser of the Bonds.

 

Rebate Fund means the account by that name created pursuant to Section 502 of this Ordinance.

 

Record Date for the interest payable on any Interest Payment Date means the 15th day (whether or not a Business Day) of the calendar month next preceding such Interest Payment Date.

 

Redemption Date when used with respect to any Bond to be redeemed means the date fixed for redemption pursuant to the Ordinance.

 

Redemption Price when used with respect to any Bond to be redeemed means the price at which such Bond is to be redeemed pursuant to the Ordinance, including the applicable redemption premium, if any, but excluding installments of interest whose Stated Maturity is on or before the Redemption Date.

 

Replacement Bonds means Bonds issued to the beneficial owners of the Bonds in accordance with Section 211(c) hereof.

 

Reserve Policy means any surety bond or debt service reserve fund policy issued by a Reserve Policy Provider guaranteeing or insuring certain payments into the 2005F Bond Reserve Account with respect to the Bonds as provided therein and subject to the limitations set forth therein.

 

Reserve Policy Provider shall mean, Financial Security Assurance Inc., a New York stock insurance company, or any successor thereto or assignee thereof.


Revenues means all income and revenues derived and accrued by the City from the ownership and operation of the System, including interest received on moneys and securities held pursuant to this Ordinance that is paid and credited to the Waterworks Revenue Fund pursuant to Section 501 hereof and any amounts held in escrow in connection with the construction of extensions and improvements to the System to be applied

during the period of determination to pay interest on water system revenue bonds, but excluding any profits or losses on the early extinguishment of debt or on the sale or other disposition of investments or fixed or capital assets not in the ordinary course of business.

 

Securities Depository means initially, The Depository Trust Company, New York, New York, and its successors and assigns.

 

Series and Series of Bonds means any series of Additional Bonds.

 

Series D Bonds means the Water Revenue Bonds, 7th Issue, Series D, of the City authorized by Committee Substitute for Ordinance No. 941459.

 

Series 1996A Bonds means the Water Refunding Revenue Bonds, Series 1996A, of the City authorized by Committee Substitute for Ordinance No. 960924.

 

Series 1996B Bonds means the Water Revenue Bonds, Series 1996B, of the City authorized by Ordinance No. 961462.

 

Series 1998A Bonds means the Water Refunding Revenue Bonds, Series 1998A, of the City authorized by Committee Substitute for Ordinance No. 980278, as amended.

 

Series 1998B Bonds means the Water Revenue Bonds, Series 1998B, of the City authorized by Committee Substitute for Ordinance No. 980296, as amended.

 

Series 2000A Bonds means the Water Revenue Bonds, Series 2000A, of the City authorized by Ordinance No. 000037, as amended.

 

Series 2002C Bonds or 2002C Bonds means the Water Revenue Bonds, Series 2002C, of the City, authorized by Committee Substitute for Ordinance No. 020325, as amended.

 

Series 2004D Bonds or 2004D Bonds means the Water Revenue Bonds, Series 2004D, of the City, authorized by Ordinance No. 040693, as amended.

 

Special Record Date for the date fixed by the Paying Agent pursuant to Section 205 for the payment of any Defaulted Interest.

 

Stated Maturity when used with respect to any Bond or any installment of interest thereon means the date specified in the Ordinance as the fixed date on which the principal of such Bond or such installment of interest is due and payable.

 

Surplus Account means the account by that name created pursuant to Section 502 of the Ordinance.


System or Water System means the entire waterworks plant and system owned and operated by the City for the production, storage, treatment and distribution of water, to serve the needs of the City and its inhabitants and others, including all appurtenances and facilities connected therewith or relating thereto, together with all extensions, improvements, additions and enlargements thereto hereafter made or acquired by the City. At the discretion of the City there may be excluded from the System facilities which are hereafter constructed or acquired, connected or separate from the System, which are not financed with the proceeds of revenue bonds payable from the revenues of the System, and for which the City maintains separate and distinct operations, facilities and records, and which if connected to the System are billed for System use as a customer of the System in accordance with the ordinances and regulations of the City.

 

Tax Compliance Agreement means the Citys Tax Compliance Agreement, dated as of the date on which the Bonds are originally issued and authenticated, as the same may be amended or supplemented in accordance with the provisions thereof.

 

Terms Ordinance means an ordinance of the City adopted prior to the issuance of the Bonds, which, among other matters, establishes the maturities, interest rates and sinking fund redemption provisions for the Bonds.

 

United States Government Obligations means bonds, notes, treasury bills or other securities constituting direct obligations of, or obligations the principal of and interest on which are fully and unconditionally guaranteed as to full and timely payment by, the United States of America, including evidences of ownership of proportionate interest in future interest and principal payments on United States Government Obligations held by a bank or trust company as custodian, under which the owners of the investment is the real party in interest and has the right to proceed directly and individually against the obligor and the underlying United States Government Obligations and not available to any person claiming through the custodian or to whom the custodian may be obligated.

 

Water Revenue Bonds means collectively the Bonds, the Parity Bonds and all other revenue bonds which are payable out of, or secured by an interest in, the income and Revenues derived from the operation of the System.

 

Waterworks Revenue Fund means the fund created pursuant to Section 15 of the Committee Substitute for Ordinance No. 63168 and referred to in Section 501 of this Ordinance.

 

ARTICLE II

AUTHORIZATION OF BONDS

 

Section 201. Authorization of the Bonds. The Council hereby authorizes and directs the issuance of the Water Revenue Bonds, Series 2005F, of the City in the principal amount of $30,000,000, for the purpose of providing funds to pay part of the cost of the Project, as provided in this Ordinance.

 


Section 202. Claims Upon the Bond Insurance Policy and Payments by and to the Bond Insurer.

 

(a) If, on the third Business Day prior to the related Interest Payment Date for the Bonds there is not on deposit with the Paying Agent, after making all transfers and deposits required under this Ordinance, sufficient moneys available to pay the principal of and interest on the Bonds due on such date, the Paying Agent shall give notice to the Bond Insurer and to its designated agent (if any) (the Fiscal Agent) by telephone or telecopy of the amount of such deficiency by 12:00 noon, New York City time, on such Business Day. If, on the Interest Payment Date, there continues to be a deficiency in the amount available to pay the principal of and interest on the Bonds due on such Interest Payment Date, the Paying Agent shall make a claim under the Bond Insurance Policy and give notice to the Bond Insurer and the Fiscal Agent (if any) by telephone of the amount of such deficiency, and the allocation of such deficiency between the amount required to interest on the Bonds and the amount required to pay principal of the Bonds, confirmed in writing to the Bond Insurer and the Fiscal Agent by 12:00 noon, New York City time, on such Interest Payment Date by filling in the form of Notice of Claim and Certificate delivered with the Bond Insurance Policy.

 

(b) The Paying Agent shall designate any portion of payment of principal on Bonds paid by the Bond Insurer, whether by virtue of mandatory sinking fund redemption, maturity or other advancement of maturity, on its books as a reduction in the principal amount of Bonds registered to the then current Bondowner, whether DTC or its nominee or otherwise, and shall issue a replacement Bond to the Bond Insurer, registered in the name of Financial Security Assurance Inc., in a principal amount equal to the amount of principal so paid (without regard to authorized denominations); provided that the Paying Agents failure to so designate any payment or issue any Replacement Bonds shall have no effect on the amount of principal or interest payable by the City on any Bond or the subrogation rights of the Bond Insurer.

 

(c) The Paying Agent shall keep a complete and accurate record of all funds deposited by the Bond Insurer into the Policy Payments Account (as defined below) and the allocation of such funds to payment of interest on and principal paid in respect of any Bond. The Bond Insurer shall have the right to inspect such records at reasonable times upon reasonable notice to the Paying Agent.

 

(d) Upon payment of a claim under the Bond Insurance Policy the Paying Agent shall establish a separate special purpose trust account for the benefit of Bondowners (the Policy Payments Account) and over which the Paying Agent shall have exclusive control and sole right of withdrawal. The Paying Agent shall receive any amount paid under the Bond Insurance Policy in trust on behalf of Bondowners and shall deposit any such amount in the Policy Payments Account and distribute such amount only for purposes of making the payments for which a claim was made. Such amounts shall be disbursed by the Paying Agent to Bondowners in the same manner as principal and interest payments are to be made with respect to the Bonds under the sections hereof regarding payment of Bonds. It shall not be necessary for such payments to be made by checks or wire transfers separate from the check or wire transfer used to pay debt service with other funds available to make such payments. Notwithstanding anything to the contrary otherwise set forth in this Ordinance, and to the extent permitted by law, in the event amounts paid under the Bond Insurance Policy are applied to claims for payment of principal of or interest on the Bonds, interest on such principal of and interest on such Bonds shall accrue and be payable from the date of such payment at the greater of (1) the per annum rate of interest, publicly announced from time to time by JPMorgan Chase Bank or its successor at its principal office in the City of New York, as its prime or base lending rate plus 3%, and (2) the then applicable rate of interest on the Bonds provided that in no event shall such rate exceed the maximum rate permissible under applicable usury or similar laws limiting interest rates.

 

(e) Funds held in the Policy Payments Account shall not be invested by the Paying Agent and may not be applied to satisfy any costs, expenses or liabilities of the Paying Agent. Any funds remaining in the Policy Payments Account following an Interest Payment Date shall promptly be remitted to the Bond Insurer.

 

(f) The Bond Insurer shall, to the extent it makes any payment of principal of or interest on the Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Bond Insurance Policy. The obligations to the Bond Insurer shall survive discharge or termination of the Bonds or this Ordinance.

 

(g) The Bond Insurer shall be entitled to pay principal or interest on the Bonds that shall become Due for Payment but shall be unpaid by reason of Nonpayment by the City (as such terms are defined in the Bond Insurance Policy) and any amounts due on the Bonds as a result of acceleration of the maturity thereof in accordance with the provisions of this Ordinance, whether or not the Bond Insurer has received a Notice of Nonpayment (as such terms are defined in the Bond Insurance Policy) or a claim upon the Bond Insurance Policy.

 

Section 203. Description of the Bonds. The Bonds shall consist of fully registered bonds without coupons, numbered from R-1 upward, in the denomination of $5,000 or any integral multiple thereof and not exceeding the principal amount of Bonds maturing in the year in which such Bond becomes due, as may be specified by the Registered Owner of such Bond. The Bonds, as originally issued or issued upon transfer, exchange or substitution, shall be substantially in the form set forth in Section 401 of this Ordinance, with appropriate insertions and deletions as are approved by the Director of Finance, which approval will be conclusively evidenced by the Director of Finances signature on the Bonds. The Bonds shall be subject to registration, transfer and exchange as provided in Section 206 of this Ordinance. The Bonds shall be dated September 15, 2005, shall become due in the amounts on the Stated Maturities (subject to optional and mandatory redemption prior to their Stated Maturities as provided in Article III hereof), and shall bear interest at the rates per annum to be determined upon the sale of the Bonds as set forth in the Terms Ordinance.

 

At the election of the original purchasers of the Bonds, term Bonds may be issued in lieu of serial Bonds with Stated Maturities as in this section provided and such term Bonds shall be subject to mandatory redemption in the annual amounts and on the dates set forth in this section as the Stated Maturities for such serial Bonds.

 

The Bonds shall bear interest (computed on the basis of a 360-day year of twelve 30-day months) from the most recent Interest Payment Date to which interest has been paid in full or, if no interest has been paid, from September 1, 2005. Interest on the Bonds shall be payable semiannually on June 1 and December 1 in each year, commencing June 1, 2006, and at their Stated Maturity.

 

Section 204. Designation of Paying Agent and Bond Registrar. The Director of Finance shall designate the Paying Agent for the payment of principal of and interest on the Bonds and bond registrar with respect to the registration, transfer and exchange of Bonds (in such capacity, the "Bond Registrar").

 

The City will at all time maintain a Paying Agent meeting the qualifications herein described for the performance of the duties hereunder. The City reserves the right to appoint a successor Paying Agent by (1) filing with the bank or trust company then performing such function a certified copy of the proceedings giving notice of the termination of such bank or trust company and appointing a successor, and (2) causing notice to be given by first class mail to each Bondowner. No resignation or removal of the Paying Agent shall become effective until a successor has been appointed and has accepted the duties of the Paying Agent.

 

Every Paying Agent appointed hereunder shall at all times be (1) a commercial banking association or corporation or trust company located in the State of Missouri organized and in good standing and doing business under the laws of the United States of America or of the State of Missouri and subject to supervision or examination by federal or state regulatory authority and (2) shall have a reported capital (exclusive of borrowed capital) plus surplus of not less than $100,000,000 or consideration may be given by the City to a bank not meeting this amount if the bank submits an acceptable form of guarantee for its financial obligations to the City. If such institution publishes reports of conditions at least annually pursuant to law or regulation, then for the purposes of this Section the capital and surplus of such institution shall be deemed to be its capital and surplus as set forth in its most recent report of condition so published.

 

The Paying Agent shall be paid in accordance with its proposal for fees and expenses submitted to the Director of Finance as an operating expense of the System.

 

Section 205. Method and Place of Payment of Bonds. The principal or Redemption Price of and interest on the Bonds shall be payable in any coin or currency of the United States of America that, on the respective dates of payment thereof, is legal tender for the payment of public and private debts.

 

The principal or Redemption Price of each Bond shall be paid at Maturity by check or draft to the Person in whose name such Bond is registered on the Bond Register at Maturity thereof, upon presentation and surrender of such Bond at the principal corporate trust office of the Paying Agent or at such other office as the Paying Agent may designate.

 

The interest payable on each Bond on any Interest Payment Date shall be paid to the Registered Owner of such Bond as shown on the Bond Register at the close of business on the Record Date for such interest (a) by check or draft mailed to the Registered Owner at the address as it appears in the Bond Register or (b) at the option of Registered Owner of such Bonds in the aggregate principal amount of not less than $1,000,000 by wire transfer to an account designated by such Registered Owner, upon written notice given to the Paying Agent by such Registered Owner not later than the Record Date for such interest, containing the electronic transfer instructions, including the bank (which shall be in the continental United States), ABA routing number and account number to which such Registered Owner wishes to have such transfer directed.

 

Notwithstanding any of the foregoing provisions of this Section 205 to the contrary, any interest on the Bonds which is payable, but is not punctually paid on any Interest Payment Date (herein called Defaulted Interest), shall be payable to the Persons in whose names the Bonds are registered at the close of business on a Special Record Date. The Special Record Date shall be fixed in the following manner: (a) the City shall notify the Bond Registrar and the Depository in writing of the amount of Defaulted Interest proposed to be paid on the Bonds and the date of the proposed payment, which proposed payment date shall be at least thirty (30) days after receipt of the Bond Registrar of such notice from the City; (b) at the same time the City shall deposit with the Paying Agent an amount of money equal to the aggregate amount to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Paying Agent for such deposit prior to the date of the proposed payment; and (c) thereupon, the Bond Registrar shall fix a Special Record Date for the payment of such Defaulted Interest which shall be fifteen (15) calendar days prior to the date of the proposed payment. Following receipt of such funds, the Paying Agent shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 nor less than 10 days prior to the date of the proposed payment. The Paying Agent shall promptly notify the City of such Special Record Date and, in the name and at the expense of the City, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed by first class mail, postage prepaid, to each Registered Owner of a Bond entitled to such notice at the address of such Registered Owner as it appears on the Bond Register not less than 10 days prior to such Special Record Date.

 

The Paying Agent shall keep a record of payment of principal and Redemption Price of and interest on all Bonds and shall at least annually forward a copy or summary of such records to the City.

 

Section 206. Registration, Transfer and Exchange of Bonds. The City covenants that, as long as any of the Bonds remain Outstanding, it will cause the Bond Register to be kept at the corporate trust office of the Paying Agent for registration, transfer and exchange of Bonds as herein provided. Each Bond when issued shall be registered in the name of the Registered Owner as to both principal and interest in the Bond Register.

 

Bonds may be transferred in the Bond Register only on the Bond Register as provided in this Section 206. Upon surrender of any Bond at the principal corporate trust office of the Paying Agent or at such other officer as the Paying Agent may designate, the Paying Agent shall transfer or exchange such bond for a new Bond or Bonds in any authorized denominations of the same Stated Maturity and in the same aggregate principal amount as the Bond that was presented for transfer or exchange. Bonds presented for transfer or exchange shall be accompanied by a written instrument or instruments of transfer or authorization for exchange, in a form and with guarantee of signature satisfactory to the Paying Agent, duly executed by the Registered Owner thereof or by the Registered Owners duly authorized agent.

 

In all cases in which the privilege of transferring or exchanging Bonds is exercised, the Paying Agent shall authenticate and deliver Bonds in accordance with the provisions of this Ordinance. The City shall pay the fees and expenses of the Paying Agent for the registration, transfer and exchange of Bonds provided for by this Ordinance and the cost of printing a reasonable supply of registered bond blanks. Any additional costs or fees that might be incurred in the secondary market, other than fees of the Paying Agent, are the responsibility of the Registered Owners of the Bonds. In the event any Registered Owner fails to provide a certified taxpayer identification number to the Paying Agent, the Paying Agent may make a charge against such Registered Owner sufficient to pay any governmental charge required to be paid as a result of such failure. In compliance with Section 3406 of the Code, such amount may be deducted by the Paying Agent from amounts otherwise payable to such Registered Owner hereunder or under the Bonds.

 

The City and the Paying Agent shall not be required (a) to register the transfer or exchange of any Bond after notice calling such Bond or portion thereof for redemption has been given or during the period beginning at the opening of business fifteen (15) days preceding the date of mailing of a notice of redemption for Bonds selected for redemption, or (b) to register the transfer or exchange of any Bond during a period beginning at the opening of business on the day after receiving written notice from the City of its intent to pay Defaulted Interest and ending at the close of business on the date fixed for the payment of Defaulted Interest pursuant to this Ordinance.

 

The City and the Paying Agent may deem and treat the Person in whose name any Bond is registered on the Bond Register as the absolute owner of such Bond, whether such Bond is overdue or not, for the purpose of receiving payment of, or on account of, the principal or Redemption Price of and interest on any Bond and for all other purposes. All payments so made to any such Registered Owner or upon the Registered Owners order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the City nor the Paying Agent shall be affected by any notice to the contrary. At reasonable times and under reasonable regulations established by the Paying Agent, the Bond Register may be inspected and copied by the Registered Owners (or a designated representative thereof) of 10% or more in principal amount of the Bonds then Outstanding or any designated representative of such Registered Owners to be evidenced to the satisfaction of the Paying Agent.

 

Section 207. Execution, Authentication and Delivery of the Bonds. Each of the Bonds, including any Bonds issued in exchange or as substitute for Bonds initially delivered, shall be executed on behalf of the City by the manual or facsimile signature of its Mayor and attested by the manual or facsimile certificate of its City Clerk and countersigned by the manual signature of the Director of Finance of the City, and shall have the seal of the City affixed thereto or imprinted thereon. In the event any officer whose signature or facsimile thereof appears on any Bond shall cease to be such officer before the delivery of such Bond, such signature or facsimile thereof shall nevertheless be valid and sufficient for all purposes, the same as if such person had remained in office until delivery. Any Bond may be executed by such persons as at the actual time of the execution of such Bond shall be the proper officers to sign such Bond although at the original date of such Bond such persons may not have been such officers. The Mayor, the City Clerk and the Director of Finance are hereby authorized and directed to prepare and execute the Bonds as herein specified, and when duly executed, to deliver the Bonds to the Paying Agent for authentication. The Director of Finance is hereby authorized and directed to deliver the Bonds to the original purchasers thereof upon the payment of the purchase price of the principal amount of the Bonds plus premium, if any, and accrued interest to the date of payment and delivery. The Bonds shall have endorsed thereon a Certificate of Authentication substantially in the form hereinafter set forth which shall have the registration date inserted and shall be manually executed by the Paying Agent, but it shall not be necessary that the same officer or employee sign the Certificate of Authentication on all of the Bonds that may be issued hereunder at any one time. No Bond shall be entitled to any security or benefit under this Ordinance or shall be valid or obligatory for any purpose unless and until such Certificate of Authentication shall have been duly executed by the Paying Agent by manual signature. Such executed Certificate of Authentication upon any Bond shall be conclusive evidence that such Bond has been duly authenticated and delivered under this Ordinance and that such Registered Owner has been entered on record in the Bond Register kept by the Bond Registrar. The Certificate of Authentication shall be deemed to have been duly executed if the Registration Date has been inserted and if it has been signed and dated by an authorized officer or employee of the Paying Agent.

 

Section 208. Mutilated, Lost, Stolen or Destroyed Bonds. In the event any Global Bond Certificate or replacement Bond shall become mutilated, or be lost, stolen or destroyed, the City shall execute and the Bond Registrar shall authenticate and shall deliver a new Bond of like date and tenor as the Bond mutilated, lost, stolen or destroyed, provided that, in the case of any mutilated Bond, such mutilated Bond shall first be surrendered to the Bond Registrar, and in the case of any lost, stolen or destroyed Bond, there shall be first furnished to the City and the Bond Registrar evidence of such loss, theft or destruction satisfactory to the City and the Bond Registrar, together with indemnity satisfactory to them to save each of them harmless, and provided further that any applicable statutory requirements pertaining to mutilated, lost, stolen or destroyed Bonds are met. In the event any such Bond shall have matured, instead of issuing a replacement Bond the City may pay or authorize the payment of the same without surrender thereof. Upon the issuance of any replacement Bond, the City and the Bond Registrar may require the payment of any amount sufficient to reimburse the City and the Bond Registrar for any tax or other governmental charge that may be imposed with respect thereto and any other reasonable fees and expenses incurred in connection therewith. The provisions of this Section 208 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, lost, stolen or destroyed Bonds.

 

Section 209. Cancellation and Destruction of Bonds Upon Payment. All Bonds that have been paid or redeemed or that otherwise have been surrendered to the Paying Agent, either at or before Maturity, shall be cancelled by the Paying Agent immediately upon the payment, redemption and surrender thereof to the Paying Agent and subsequently destroyed in accordance with the customary practices of the Paying Agent and applicable retention laws.

 

Section 210. Preliminary and Final Official Statement. The Preliminary Official Statement, in the form on file in the office of the Director of Finance, is hereby ratified and approved, and the final Official Statement is hereby authorized and approved by supplementing, amending and completing the Preliminary Official Statement, with such changes and additions thereto as are necessary to conform to and describe the transaction. The Director of Finance is hereby authorized to execute the final Official Statement as so supplemented, amended and completed, and the use and public distribution of the Official Statement by the Purchaser in connection with the reoffering of the Bonds is hereby authorized. The proper officials of the City are hereby authorized to execute and deliver a certificate pertaining to such Official Statement as prescribed therein, dated as of the date of payment for and delivery of the bonds.

 


For the purpose of enabling the Purchaser to comply with the requirements of Rule 15c2-12-(b)(1) of the Securities and Exchange Commission, the City hereby deems the information regarding the City contained in the Preliminary Official statement to be final as of its date, except for the omission of such information as is permitted by Rule 15c2-12(b)(1), and the appropriate officers of the City are hereby authorized, if requested, to provide the Purchaser a letter or certification to such effect and to take such other actions or execute such other documents as such officers in their reasonable judgment deem necessary to enable the Purchaser to comply with such requirement of such Rule.

 

The City agrees to provide to the Purchaser within seven Business Days of the date of the sale of Bonds sufficient copies of the final Official Statement to enable the Purchaser to comply with the requirements of Rule 15c2-12(b)(4) of the Securities and Exchange Commission and with the requirements of Rule G-32 of the Municipal Securities Rulemaking Board.

 

Section 211. Book-Entry Only System.

 

(a) Notwithstanding any other provision hereof, upon initial issuance of the Bonds, the Bonds shall be registered in the name of Cede & Co., as nominee of DTC. Except as provided in this Section 211, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC. The definitive Bonds shall be initially issued in the form of one typewritten certificate for each stated maturity of the Bonds.

 

(b) With respect to the Bonds registered in the name of Cede & Co., as nominee of DTC, the City and the Paying Agent shall have no responsibility or obligation to any DTC Participant or to any person on behalf of whom such a DTC Participant holds an interest in the Bonds, without limiting the immediately preceding sentence, the City and the Paying Agent shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a Registered Owner, as shown on the registration books of the City maintained by the Paying Agent, of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than a Registered Owner, as shown in the registration books of the City maintained by the Paying Agent, of the principal, interest and premium, if any, with respect to the Bonds. Notwithstanding any other provision of this Ordinance to the contrary, the City and the Paying Agent shall be entitled to treat and consider the person in whose name each Bond is registered in the Bond Register as the absolute owner of such Bond for the purpose of payment of the principal, interest and premium, if any, with respect to the Bonds, for the purpose of registering transfer with respect to such Bond, and for all other purposes whatsoever. The Paying Agent shall pay the principal, interest and premium, if any, with respect to the Bonds only to or upon the order of the respective Registered Owners, as shown in the registration books of the City maintained by the Paying Agent, as provided in this Ordinance, or their representative duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Citys obligations with respect to payment of the principal, interest and premium, if any, on the Bonds to the extent of the sum or sums so paid. No person other than a Registered Owner shall receive a Bond certificate evidencing the obligation of the City to make payments of amounts due pursuant to this Ordinance. Upon delivery by DTC to the Paying Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., the phrase Cede & Co in this Ordinance shall refer to such new nominee of DTC.

 

(c) Successor Securities Depository: Transfer Outside Book-Entry Only System. In the event that (i) the City (or DTC Participants owning at least fifty percent (50%) of the Bonds based on current DTC records) determines that DTC is incapable of discharging its responsibilities described herein and in any representation letter (Letter of Representations) of the City and the Paying Agent to DTC, (ii) the agreement among the City, the Paying Agent and DTC evidenced by any such Letter of Representations, or (iii) DTC Participants owning at least fifty percent (50%) of the Bonds based on current DTC records determines that it is in the best interest of the Beneficial Owners of the Bonds that they be able to obtain certificated Bonds, the City shall (A) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the appointment of such successor securities depository and transfer one or more Bonds to such successor securities depository, in which event the Bonds shall be registered in the name of the successor securities depository or its nominee, or (B) notify DTC and DTC Participants of the availability through DTC of certificated Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC accounts, in which event the Bonds shall be registered in whatever name or names Registered Owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Ordinance. In connection therewith, the Paying Agent may rely conclusively upon information provided by DTC with respect to the identity and interests of the DTC Participants and upon information provided by said DTC Participants with respect to the Beneficial Owners of the Bonds. The City under such circumstances agrees to provide to the Paying Agent a sufficient supply of Bond certificates to meet the Paying Agents requirements, including without limitation Bond certificates for use in the case of transfers and exchanges of Bonds.

 

(d) Payments to Cede & Co. Notwithstanding any other provision of this Ordinance to the contrary, so long as any Bonds are registered in the name of Cede & Co., as nominee of DTC, all payments of the principal, interest and premium, if any, with respect to such Bonds, and all notices with respect to such Bonds, shall be made and given, respectively, in the manner provided in the Letter of Representations of the City and the Paying Agent to DTC.

 

Section 212. Persons Deemed Owners of Bonds. The Person in whose name any Bond shall be registered in the Bond Register shall be deemed and regarded by the City, the Bond Registrar and the Paying Agent as the absolute owner thereof, whether such Bond shall be overdue or not, for the purpose of receiving payment therefor or on account thereof and for all purposes, and neither the City, the Bond Registrar nor the Paying Agent shall be affected by notice to the contrary, except that the Bond Insurer shall be deemed to be the Bondowner of the Bonds guaranteed by the Bond Insurance Policy for all purposes. Payment of or on account of the principal of, premium, if any, and interest on any Bond shall be made only to or upon the order of the Registered Owner thereof or agent duly authorized in writing. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond, including the interest thereon, to the extent of the sum or sums so paid.

 


ARTICLE III

REDEMPTION OF BONDS

 

Section 301. Redemption of Bonds. The Bonds shall be subject to redemption and payment prior to their Stated Maturities as follows:

 

(a) Mandatory Redemption. In the event term Bonds are issued as provided in Section 203 of this Ordinance, such Bonds shall be subject to mandatory redemption and payment prior to their Stated Maturity pursuant to the mandatory redemption requirements of this Section 301 on the dates of the Stated Maturities for serial Bonds at the principal amount thereof plus accrued interest to the Redemption Dates, without premium. The City shall redeem on such dates the principal amounts set forth as serial maturities by this Ordinance and the remaining principal amount of Bonds maturing on the Stated Maturity of the respective term bond, shall be paid at their Stated Maturity.

 

The Paying Agent shall each year in which Bonds maturing on the Stated Maturity of the respective term bond, are to be redeemed pursuant to this subsection make timely selection of such Bonds or portion of such Bonds to be so redeemed and shall give notice thereof as hereinafter provided. Upon instructions duly given by the City, moneys deposited in the hereinafter referred to 2005F Water Debt Fund may be used at any time after December 1, in the year next preceding the first of such mandatory redemption to purchase Bonds maturing on the Stated Maturity of the respective term bond, in the open market at a price not in excess of their principal amount and moneys deposited in the 2005F Water Debt Fund may be used for the purpose of paying interest on the Bonds so purchased at the rate specified thereon to the date of purchase. Each bond so purchased shall be credited at 100% of the principal amount thereof on the obligation of the City to redeem Bonds on the next mandatory redemption date applicable to Bonds of such Stated Maturity, and the principal amount of Bonds of such Stated Maturity to be redeemed by operation of the preceding paragraph shall be reduced accordingly.

 

(b) Optional Redemption. The Bonds maturing on December 1, 2016, and thereafter shall be subject to redemption and payment prior to their Stated Maturities at the option of the City on and after December 1, 2015, at any time as a whole or in part on any Interest Payment Date from maturities selected by the City (Bonds of less than a full maturity to be selected in multiples of $5,000 principal amount by the Paying Agent in such equitable manner as it shall designate), at the redemption price equal to the principal amount thereof, plus accrued interest to the Redemption Date.

 

Section 302. Selection of Bonds to be Redeemed. The Paying Agent shall call Bonds for redemption and payment as herein provided upon receipt at least forty-five (45) days prior to the Redemption Date of a written request of the City; provided, however, that no such request shall be required for mandatory redemption of Bonds pursuant to Section 301(a) hereof. Such request shall specify the principal amount of the Bonds to be called for redemption, the Redemption Price or Price(s) and the Redemption Date. Bonds shall be redeemed in the principal amount of $5,000 or an integral multiple thereof. In the case of a partial redemption of Bonds of the same Stated Maturity, the Bonds to be redeemed shall be selected by the Paying Agent from the Outstanding Bonds of that Stated Maturity by such methods as the Paying Agent shall deem fair and appropriate and which may provide for the selection for redemption of a portion of the principal of Outstanding Bonds of that Stated Maturity that have been issued in a denomination larger than $5,000. The portions of the principal of Outstanding Bonds so selected for partial redemption shall be equal to $5,000 or integral multiples thereof. Any Bond which is to be redeemed only in part shall be submitted to the Paying Agent and delivered to the Bond Registrar, who shall authenticate and deliver to the Registered Owner of such Bond, without service charge, a new Bond or Bonds, of any authorized denomination as requested by such Registered Owner in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. If the Registered Owner of any such Bond of a denomination greater than $5,000 shall fail to present such Bond to the Paying Agent for payment and exchange as aforesaid, such Bond shall, nevertheless, become due and payable on the Redemption Date to the extent of the principal amount of such Bond called for redemption (and to that extent only).

 

Section 303. Notice and Effect of Call for Redemption. The Paying Agent shall give written notice in the name of the City of its intention to redeem and pay Bonds at the principal corporate trust office of the Paying Agent or such other office as the Paying Agent may designate. Notice of redemption shall be given by first class mail, postage prepaid, mailed not less than thirty (30) days prior to the Redemption Date, to each Registered Owner of Bonds to be redeemed, at such Registered Owners address appearing in the Bond Register. All notices of redemption shall state:

 

(a) the Redemption Date;

 

(b) the Redemption Price;

 

(c) if less than all Outstanding Bonds are to be redeemed, the identification (and in the case of partial redemption, the respective principal amounts) of the Bonds to be redeemed;

 

(d) that on the Redemption Date, the Redemption Price will become due and payable upon each such Bond, and that interest thereon shall cease to accrue from and after said date;

 

(e) the place where such Bonds are to be surrendered for payment of the Redemption Price; and

 

(f) the Bond Number and CUSIP number, if any.

 

The failure of the Registered Owner of any Bond to be redeemed to receive written notice mailed as hereinabove provided shall not affect or invalidate the redemption of said Bond. If any Bond is called for redemption and payment as aforesaid, all interest on such Bond shall cease from and after the date for which such call is made, provided funds are made available to the Paying Agent for its payment on the Redemption Date at the Redemption Price.

 

The Paying Agent is also directed to comply with any mandatory or voluntary standards then in effect for processing redemptions of municipal securities established by the Securities and Exchange Commission. Failure to comply with such standards shall not affect or invalidate the redemption of any Bond to be redeemed.


ARTICLE IV

FORM OF BONDS;

SECURITY FOR BONDS

 

Section 401. Form of Bonds. The Series 2005F Bonds will be in substantially the following form, with appropriate insertions and deletions as are approved by the Director of Finance, which approval will be conclusively evidenced by the Director of Finances signature on the Series 2005F Bonds.

 

FORM OF BOND

 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (DTC), to the City or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

REGISTERED REGISTERED

NUMBER R ________ $ ________________

 

UNITED STATES OF AMERICA

STATE OF MISSOURI

CITY OF KANSAS CITY

WATER REVENUE BOND

SERIES 2005F

 

Interest Rate Maturity Date Dated Date CUSIP Number

____% December 1, 20___ September 15, 2005 ____________

 

 

REGISTERED OWNER: _______________________________________________________

 

PRINCIPAL AMOUNT: _______________________________________________DOLLARS

 

THE CITY OF KANSAS CITY, MISSOURI, a constitutional charter city and a political subdivision of the State of Missouri (the City), for value received, promises to pay to the Registered Owner identified above, or registered assigns, but only from the source and in the manner hereinafter specified, on the Maturity Date identified above, unless called for redemption prior to maturity, the Principal Amount identified above and to pay interest thereon from said sources at the Interest Rate per annum specified above from the most recent interest payment date to which interest have been paid in full or, if no interest has been paid, from September 1, 2005, said interest being payable semiannually on June 1 and December 1 in each year, commencing June 1, 2006, until such principal amount has been paid.


The Principal Amount of, redemption premium, if any, and interest (computed on the basis of a 360-day year of twelve 30-day months) on this Bond are payable in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. Interest will be paid by check or draft mailed or wire transfer to the person in whose name this Bond (or one or more predecessor Bonds) is registered in the Bond Register maintained by the Bond Registrar at the close of business on the fifteenth day of the month next preceding each interest payment date (the Record Date). Interest not punctually paid will be paid as otherwise provided in the hereinafter referred to ordinance authorizing this Bond. The Principal Amount and redemption premium, if any, are payable by check or draft mailed or wire transfer to the Registered Owner on presentation and surrender hereof at the principal corporate trust office of the Paying Agent, COMMERCE BANK, N.A., KANSAS CITY, MISSOURI, or such other office as the Paying Agent may designate.

 

THIS BOND is one of a duly authorized issue of fully registered bonds of the City designated Water Revenue Bonds, Series 2005F aggregating the principal amount of $30,000,000 (the Bonds), issued for the purpose of paying part of the cost of extending and improving the waterworks system of the City including (1) the completion of the water main transmission system to all parts of the City, (2) replacement of small water mains, (3) replacement and additions to the water treatment plant and major pump stations, and (4) automation of the system (the waterworks system together with all future improvements and extensions thereto hereafter constructed or acquired by the City, being herein called the System) under the authority of and in full compliance with the Constitution and laws of the State of Missouri, and pursuant to an election held in the City at which a majority of the qualified voters of the City voting on the question voted in favor of the issuance of $150,000,000 principal amount of waterworks revenue bonds and pursuant to ordinances duly adopted by the Council of the City authorizing the issuance and delivery of the Bonds (the Ordinance). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Ordinance.

 

THE BONDS are special obligations of the City payable solely from, and secured as to the payment of principal and interest by a pledge of, the Net Revenues derived by the City from the operation of its Water System, including revenues derived from extensions and improvements to the Water System hereafter constructed or acquired by the City, after paying the operating expenses of the Water System, maintenance and repair charges, and costs due to obsolescence, and the taxing power of the City is not pledged to the payment of the Bonds as to principal or interest. The Bonds shall not be or constitute a general obligation of the City, nor shall they constitute an indebtedness of the City within the meaning of any constitutional or statutory provision, limitation or restriction.

 

THE BONDS stand on a parity and are equally and ratably secured as to the payment of principal, premium, if any, and interest with the Citys Water Revenue Bonds, 7th Issue, Series D, dated December 1, 1994, of which Bonds in the principal amount of $1,690,000 remain Outstanding; its Water Refunding Revenue Bonds, Series 1996A, dated September 1, 1996, of which Bonds in the principal amount of $20,815,000 remain Outstanding; its Water Revenue Bonds, Series 1996B, dated December 1, 1996, of which Bonds in the principal amount of $19,960,000 remain Outstanding; its Water Refunding Revenue Bonds, Series 1998A, dated May 1, 1998, of which Bonds in the principal amount of $33,680,000 remain Outstanding; its Water Revenue Bonds, Series 1998B, dated May 1, 1998, of which Bonds in the principal amount of $11,415,000 remain Outstanding; and its Water Revenue Bonds, Series 2000A, dated February 15, 2000, of which Bonds in the principal amount of $21,275,000 remain Outstanding; its Water Revenue Bonds, Series 2002C, dated April 15, 2002, of which Bonds in the principal amount of $15,960,000 remain Outstanding; and its Water Revenue Bonds, Series 2004D, dated July 15, 2004, of which Bonds in the principal amount of $25,000,000 remain Outstanding. Under the terms of the Ordinance, the City has the right to issue additional parity bonds payable from the same source and secured by the same revenues as this Bond and the series of which it is a part, provided, however, such additional bonds may be so issued only in accordance with and subject to the covenants, conditions and restrictions relating thereto set forth in the Ordinance. Reference is made to the Ordinance for a description of the covenants of the City with respect to the collection, segregation and application of the revenues of the waterworks system of the City, the nature and extent of the security of the Bonds, the rights, duties and obligation of the City with respect thereto and the rights of the Registered Owners thereof.

 

(The following paragraph is to be completed if Term Bonds are issued.)

 

[THE BONDS maturing on December 1, 20___, are subject to mandatory redemption and payment prior to maturity in the following principal amounts pursuant to the mandatory redemption requirements of the Ordinance on December 1, 20___, and on each December 1 thereafter to and including December 1, 20___, at the principal amount thereof plus accrued interest to the redemption date, without premium.]

 

AT THE OPTION of the City, the Bonds maturing on December 1, 2016, and thereafter are subject to redemption and payment prior to maturity on and after December 1, 2015, as whole at any time or in part on any Interest Payment Date at a redemption prices equal to principal amount thereof, plus accrued interest thereon to the Redemption Date. Bonds to be redeemed and paid pursuant to the provisions described above shall be selected by the Bond Registrar in such manner as it shall deem fair and appropriate.

 

WHEN BONDS are called for redemption as aforesaid, written notice thereof will be given by first class mail mailed not less than thirty (30) days prior to the redemption date to each Registered Owner of Bonds to be redeemed. All Bonds so called for redemption will cease to bear interest on the specified redemption date provided funds or certain securities in such funds are invested for their redemption are on deposit with the Paying Agent on such redemption date, and will no longer be secured by the Ordinance and will not be deemed to be outstanding under the provisions of the Ordinance. The failure of the Registered Owner of any Bond called for redemption to receive written notice mailed pursuant to the above provisions or any defect in such notice will not invalidate or affect the redemption of such Bond.

 

The Bonds are being issued by means of a book-entry system with no physical distribution of bond certificates to be made except as provided in the Ordinance. One Bond certificate with respect to each date on which the Bonds are stated to mature, registered in the nominee name of the Securities Depository, is being issued and required to be deposited with Securities Depository and immobilized in its custody. The book-entry system will evidence positions held in the Bonds by the Securities Depositorys Participants, beneficial ownership of the Bonds in authorized denominations being evidenced in the records of such Participants. Transfer of ownership shall be effected on the records of the Securities Depository and its Participants pursuant to rules and procedures established by the Securities Depository and its Participants. The City, the Bond Registrar and the Paying Agent will recognize the Securities Depository nominee, while the Registered Owner of the Bond, as the owner of the Bond for all purposes, including (i) payments of principal of, and redemption premium, if any, and interest on this Bond (ii) notices, and (iii) voting. Transfers of principal, interest and any redemption premium payments to beneficial owners of the Bonds by Participants of the Securities Depository will be the responsibility of such Participants and other nominees of such beneficial owners. The City, the Bond Registrar and the Paying Agent will not be responsible or liable for such transfers of payments or for the maintaining, supervising or reviewing the records maintained by the Securities Depository, the Securities Depository nominee, its Participants or persons acting through such Participants.

 

While the Securities Depository nominee is the owner of this bond, notwithstanding the provisions hereinabove contained payments of principal of and interest on this Bond shall be made in accordance with existing arrangements among the City, the Paying Agent and the Securities Depository.

 

EXCEPT AS OTHERWISE PROVIDED IN THE ORDINANCE THE GLOBAL BOND CERTIFICATE MAY BE TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES DEPOSITORY OR TO A SUCCESSOR SECURITIES DEPOSITORY OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

 

THE CITY hereby covenants with the Registered Owner of this Bond that it will keep and perform all covenants and agreements contained in the Ordinance, and will fix, establish, maintain and collect such rates, fees and charges for the use and services furnished by or through the System, as will produce revenues sufficient to pay the costs of operation and maintenance of the System, pay the principal of and interest on the Bonds as and when the same become due and provide reasonable and adequate reserve funds. Reference is made to the Ordinance for a description of the covenants and agreements made by the City with respect to the collection, segregation and application of the revenues of the System, the nature and extent of the security for the Bonds, the rights, duties and obligations of the City with respect thereto, and the rights of the Registered Owners thereof.

 

THIS BOND is transferable, as provided in the Ordinance, only in the Bond Register upon surrender of this Bond duly endorsed or accompanied by a written instrument of transfer satisfactory to the Bond Registrar duly executed by the Registered Owner hereof or his duly authorized attorney or legal representative, and thereupon a new Bond or Bonds in the same aggregate principal amount shall be issued to the transferee in exchange therefor subject to the conditions provided in the Ordinance. The Bonds for each maturity are issuable only in the form of fully registered Bond without coupons in denomination of $5,000 or any integral multiple thereof. The Registered Owner of any Bond or Bonds may surrender the same in exchange for an equal aggregate principal amount of Bonds of any authorized denomination in the manner and subject to the conditions provided in the Ordinance. No service charge will be made for any such transfer or exchange, but the Bond Registrar or City may require payment of any tax or governmental charge in connection therewith. The City, the Bond Registrar and the Paying Agent may deem and treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the Principal Amount or redemption price hereof and interest due hereon and for all other purposes.


THIS BOND shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Ordinance until the Certificate of Authentication hereon shall have been dated and authenticated by the Bond Registrar.

 

IT IS HEREBY CERTIFIED AND DECLARED that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of the Bonds have existed, happened and been performed in due time, form and manner as required by law, and that before the issuance of the bonds, provisions have been made for the collection and segregation of the revenues of the System and the application of the same as provided in the Ordinance.

 

IN WITNESS WHEREOF, THE CITY OF KANSAS CITY, MISSOURI, has executed this Bond by causing it to be signed by the manual or facsimile signature of its Mayor, attested by the manual or facsimile signature of its City Clerk and countersigned by the manual or facsimile signature of its Director of Finance, has caused its corporate seal to be affixed hereto or printed hereon, and has caused this Bond to be dated as of its registration date.

 

CITY OF KANSAS CITY, MISSOURI

 

 

By: _______________________________

Mayor

 

 

Attest: Countersigned:

 

 

By: ________________________________ By: ________________________________

City Clerk Director of Finance

 

 

 

CERTIFICATE OF AUTHENTICATION

 

This Bond is one of the Bonds described in the within mentioned Ordinance.

 

Registration Date: ______________________

 

COMMERCE BANK, N.A., as Bond Registrar

and Paying Agent

 

By: _______________________________

 

ASSIGNMENT

 

FOR VALUE RECEIVED the undersigned hereby sell(s), assigns(s) and transfer(s) unto

 

______________________________________________________________________________

(Social Security or other identifying number of Transferee)

 

______________________________________________________________________________

(Please Print or Typewrite Name and Address of Transferee)

 

______________________________________________________________________________

the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints

 

______________________________________________________________________________

as agent to transfer with the within Bond on the Bond Register kept by the Bond Registrar

with full power and substitution in the premises.

 

Date: _________________

 

_________________________________________

NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or enlargement or any change whatever.

 

Signature Guaranteed:

 

_________________________________________

(Eligible Guarantor Institution)

 

By: ______________________________________

Authorized Officer

 

STATEMENT OF INSURANCE

 

Financial Security Assurance Inc. ("Financial Security"), New York, New York, has delivered its municipal bond insurance policy with respect to the scheduled payments due of principal of and interest on this Bond to Commerce Bank, N.A., Kansas City, Missouri, or its successor, as paying agent for the Bonds (the "Paying Agent"). Said Policy is on file and available for inspection at the principal office of the Paying Agent and a copy thereof may be obtained from Financial Security or the Paying Agent.

 

 

Section 402. Security for Bonds. The Bonds shall be special obligations of the City payable solely from, and secured as to the payment of principal and interest by a pledge of, the Net Revenues, and the City hereby pledges such Net Revenues to the payment of the principal of and interest on the Bonds. The Bonds shall not be or constitute a general obligation of the City, nor shall they constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision, limitation or restriction, and the taxing power of the City is not pledged to the payment of the Bonds, either as to principal or interest.

 


The covenants and agreements of the City contained herein and in the Bonds shall be for the equal benefit, protection and security of the legal owners of any or all of the Bonds, all of which Bonds shall be of equal rank and without preference or priority of one Bond over any other Bond in the application of the funds herein pledged to the payment of the principal of and the interest on the Bonds, or otherwise, except as to rate of interest, date of maturity and right of prior redemption as provided in this Ordinance. The Bonds shall stand on a parity and be equally and ratably secured with respect to the payment of principal and interest from the Net Revenues and in all other respects with any Parity Bonds. The Bonds shall not have any priority with respect to the payment of principal or interest from the Net Revenues or otherwise over the Parity Bonds and the Parity Bonds shall not have any priority with respect to the payment of principal or interest from the Net Revenues or otherwise over the Bonds.

 

As security for the Citys repayment obligations with respect to the Reserve Policy, the Reserve Policy Provider is hereby granted a security interest in the Net Revenues, which shall be junior and subordinate to the security interest of the Bondowners therein.

 

ARTICLE V

CREATION AND RATIFICATION OF FUNDS AND ACCOUNTS;

DEPOSIT AND APPLICATION OF BOND PROCEEDS

 

Section 501. Waterworks Revenue Fund. So long as any of the Bonds remain outstanding and unpaid, the City covenants and agrees that all Revenues derived and to be derived by the City from the operation and use of the System, and the facilities and services furnished by the System, including the Revenues of all extensions and improvements thereto hereafter constructed or acquired, subject, however, to any liens upon or claims against the Revenues of any such extensions existing at the time of the acquisition thereof by the City, will be paid and deposited into the Waterworks Revenue Fund and that said Revenues will be segregated and kept separate and apart from the other revenues and funds of the City.

 

So long as any of the Bonds remain Outstanding, no Revenues shall be diverted to the general governmental or municipal functions of the City.

 

Section 502. Ratification and Creation of Funds and Accounts. The separate accounts and funds created or acknowledged by the Outstanding Parity Ordinances are hereby ratified and confirmed; and there are hereby created and established in the appropriate existing funds, five (5) separate additional funds and accounts to be known as the:

 

(a) Water Revenue Bonds, Series 2005F, Principal and Interest Sinking Fund (the 2005F Water Debt Fund);

 

(b) Water Revenue Bonds, Series 2005F, Reserve Account (the 2005F Bond Reserve Account);

 

(c) Water Revenue Bonds, Series 2005F, Project Fund (the Project Fund);

 

(d) Water Revenue Bonds, Series 2005F, Costs of Issuance Fund (the Costs of Issuance Fund); and


(e) Rebate Fund for Water Revenue Bonds, Series 2005F (the Rebate Fund).

 

Section 503. Deposit of Bond Proceeds. The net proceeds received from the sale of the Bonds shall be deposited simultaneously with the delivery of the Bonds as follows:

 

(a) Any accrued interest on the Bonds shall be deposited in the 2005F Water Debt Fund and applied in accordance with Section 601 hereof.

 

(b) An amount determined by the Director of Finance shall be deposited in the Costs of Issuance Fund and shall be disbursed by the Director of Finance to pay costs of issuing the bonds.

 

(c) The remaining balance of the proceeds of the Bonds shall be deposited in the Project Fund and applied in accordance with Section 504.

 

Section 504. Application of Moneys in Project Fund. Moneys in the Project Fund shall be used solely for the purpose of paying part of the cost of the Project as hereinbefore provided, in accordance with the plans therefor and heretofore approved by the Council of the City and on file in the office of the Director of the Department of Water Services, including any alterations in or amendments to said plans deemed advisable by the Director of the Department of Water Services and approved by the Council of the City.

 

Withdrawals from the Project Fund shall be made only when authorized by the Council and only on duly authorized and executed warrants or vouchers therefor prepared in accordance with procedures issued by the Director of the Department of Water Services that such payment is being made for a purpose within the scope of this Ordinance and that the amount of such payment represents only the contract price of the property, equipment, labor, materials or service being paid for or, if such payment is not being made pursuant to an express contract, that such payment is not in excess of the reasonable value thereof.

 

Upon completion of the extensions and improvements to the System as hereinbefore provided, any surplus moneys remaining in the Project Fund and not required for the payment of unpaid costs thereof shall be deposited in the 2005F Water Debt Fund. Any surplus credited to the 2005F Water Debt Fund shall be applied by the Paying Agent as directed by the City solely to the payment of principal of, redemption premium, if any, and interest on the Bonds through the payment or redemption thereof at the earliest date permissible under the terms of this Ordinance. The balance transferred to the 2005F Water Debt Fund may first be used to pay any principal payment on the Bonds coming due in that current bond year. If the balance transferred is greater than the current bond year principal payment, the excess shall be used to call Bonds for redemption in accordance with subsection 301 (b) hereof. Any Bonds purchased by the Paying Agent pursuant to this provision with moneys from the 2005F Water Debt Fund will be deemed cancelled.

 

Notwithstanding the foregoing, unless the Bond Insurer otherwise directs, upon the occurrence and continuance of an event of default or the occurrence and continuation of an event which with notice or lapse of time or both would constitute an event of default, amounts on deposit in the Project Fund shall not be disbursed but shall instead be applied to the payment of debt service or redemption price of the Bonds.

 

Section 505. Application of Moneys in Costs of Issuance Fund. Moneys in the Costs of Issuance Fund shall be used solely for the purpose of paying the costs and expenses incident to the issuance of the Bonds upon certification thereof by the Director of Finance. On the latest to occur of (i) the payment in full of such amounts (as certified by the Director of Finance) or (ii) the date which is six months following the date on which the Bonds are issued and authenticated, any moneys remaining in the Costs of Issuance Fund shall be transferred to the Project Fund and applied in accordance with the provisions of Section 504 of this Ordinance.

 

ARTICLE VI

APPLICATION OF REVENUES

 

Section 601. Application of Moneys in Funds and Account. The City covenants and agrees that so long as any of the Bonds remain Outstanding, moneys paid and deposited in the Waterworks Revenue Fund by the City will be administered and disposed of as follows:

 

(a) The City, each month, shall pay or make provision for the payment from the moneys in the Waterworks Revenue Fund of all operating expenses, all maintenance and repair charges and all costs of the System due to obsolescence or other causes.

 

(b) After paying or making provision for the payment each month of the reasonable and proper expenses of operating and maintaining the System for the current month, the City shall next pay and credit monthly from the Waterworks Revenue Fund to the Water Revenue Bonds, 7th Issue Series D, Principal and Interest Sinking Fund created by Committee Substitute for Ordinance No. 941459 of the City so long as any of the Series D Bonds remain Outstanding; to the Water Revenue Bonds, Series 1996A, Principal and Interest Account created by Committee Substitute for Ordinance No. 960924 of the City so long as any of the Series 1996A Bonds remain Outstanding; to the Water Revenue Bonds, Series 1996B, Principal and Interest Account created by Ordinance No. 961462 of the City so long as any of the Series 1996B Bonds remain Outstanding; to the Water Revenue Bonds, Series 1998A, Principal and Interest Account created by Committee Substitute for Ordinance No. 980278, as amended, of the City so long as any of the Series 1998A Bonds remain Outstanding; to the Water Revenue Bonds, Series 1998B, Principal and Interest Account created by Committee Substitute for Ordinance No. 980296, as amended, of the City so long as any of the Series 1998B Bonds remain Outstanding; to the Water Revenue Bonds, Series 2000A, Principal and Interest Account created by Ordinance No. 000037, as amended, of the City so long as any of the Series 2000A Bonds remain Outstanding; to the Water Revenue Bonds, Series 2002C, Principal and Interest Sinking Fund created by Committee Substitute for Ordinance No. 020325, as amended, of the City so long as any of the Series 2002C Bonds remain Outstanding; and to the Water Revenue Bonds, Series 2004D, Principal and Interest Sinking Fund created by Ordinance No. 040693, as amended, of the City so long as any of the Series 2004D Bonds remain Outstanding; all amounts required to be so paid and credited by the provisions of said ordinances and, at the same time that said payments and credits to said principal and interest sinking fund accounts are made, and on a parity therewith, the City shall pay and credit monthly from the Waterworks Revenue Fund to the 2005F Water Debt Fund, to the extent necessary to meet at each Interest Payment Date and Maturity thereof, all interest on and principal of the Bonds, the following sums:

 

(i) Beginning the first of said monthly deposits on October 1, 2005, and continuing on the first day of each month thereafter to and including June 1, 2006, an equal pro rata portion of the amount of interest becoming due on the Bonds on June 1, 2006; and thereafter, beginning on June 1, 2006, and continuing on the first day of each month thereafter so long as any of the Bonds shall remain Outstanding, an amount not less than 1/6th of the amount of interest that will become due on the Bonds on the next succeeding Interest Payment Date; and

 

(ii) Beginning with the first of said monthly deposits on December 1, 2008 and continuing on the first day of each month thereafter to and including November 1, 2009, an equal pro rata portion of the amount of principal becoming due on the Bonds on December 1, 2009; and thereafter, beginning on December 1, 2009, and continuing on the first day of each month thereafter, so long as any of the Bonds shall remain Outstanding an amount not less than 1/12th of the amount of principal that will become due on the Bonds on the next succeeding Principal Payment Date; and

 

(iii) On the first day of each month in which fees, if any, of the Bond Registrar and Paying Agent are scheduled to become due, such amounts as may be required to pay such fees of the Bond Registrar and the Paying Agent.

 

All amounts paid and credited to the 2005F Water Debt Fund shall be expended and used by the City for the sole purpose of paying any interest on and principal of the Bonds as and when the same become due and the fees of the Bond Registrar and the Paying Agent for acting as Bond Registrar and Paying Agent, if any.

 

If at any time the moneys in the Waterworks Revenue Fund shall be insufficient to make in full the payments and credits at the time required to be made by the City to the principal and interest accounts established to pay the then Outstanding Water Revenue Bonds of the City, including only the Bonds and other Water Revenue Bonds of the City heretofore or hereafter issued and standing on a parity with the Bonds, the available moneys in the Waterworks Revenue Fund shall be divided among such principal and interest sinking fund accounts in proportion to the respective principal amounts of said series of Water Revenue Bonds of the City at the time outstanding which are payable from the moneys in such principal and interest sinking fund accounts.

 

(c) Simultaneously with the issuance of the Bonds, the City shall provide for the 2005F Bond Reserve Account to contain an amount equal to the Bond Reserve Requirement. In lieu of a cash deposit, the Bond Reserve Requirement will be satisfied by the Reserve Policy, as more fully provided in Section 602 hereof. The prior written consent of the Bond Insurer shall be a condition precedent to the deposit of any credit instrument provided in lieu of a cash deposit into the 2005F Bond Reserve Account.

 

(d) All moneys in any Bond Reserve Account will be used for the payment of principal of and interest on the related Series of bonds for which funds might not otherwise be available, or to pay a like amount of the last maturing bonds, of such Series; provided, however, that the City shall not make a Notice of Nonpayment under the Reserve Policy for the purpose of paying the last maturing Bonds. Should the City expend any portion of the 2005F Bond Reserve Account and thereby reduce the amount therein below the Bond Reserve Requirement, except for the purpose of retiring all Outstanding Bonds, or should a valuation of the 2005F Bond Reserve Account indicate that it is below the Bond Reserve Requirement, the City shall, subject to the provisions of the last paragraph of this Section 601, transfer monthly to such 2005F Bond Reserve Account, all available funds after providing for the payment and transfers set forth above, until the 2005F Bond Reserve Account shall have again attained the Bond Reserve Requirement. In no event shall the replenishment of the Bond Reserve Requirement be accomplished in more than one year from the date of the initial Notice of Nonpayment under the Reserve Policy.

 

If at any time the moneys in the Waterworks Revenue Fund shall be insufficient to make in full any payments and credits at the time required to be made by the City to the Bond Reserve Accounts established by the City to protect the payment of the outstanding water revenue bonds of the City including the Outstanding Parity Bonds, and Additional Bonds issued and standing on a parity with the Bonds, the available moneys in said Waterworks Revenue Fund shall be divided among such Bond Reserve Accounts in proportion to the respective principal amounts of said Series of water revenue bonds of the City at the time Outstanding which are payable from the moneys in such Bond Reserve Accounts.

 

(e) When and after there shall be in the Water Revenue Fund an amount sufficient to pay the reasonable and proper expenses of operating and maintaining the System for the current month as provided in paragraph (a) of this Section 601 and when and after all amounts at the time required to be paid and credited from the Water Revenue Fund under the provisions of paragraphs (b), (c) and (d) of this Section 601 shall have been paid and credited, all moneys remaining in the Water Revenue Fund shall be credited monthly to the Surplus Account. Except as hereinafter provided, moneys in the Surplus Account shall be used solely for the following purposes, as determined by the Council:

 

(i) paying the cost of operation, maintenance and repair of the System to the extent that may be necessary after the application of the moneys held in the Water Revenue Fund under the provisions of paragraph (a) of this Section 601;

 

(ii) anticipating payments into or increasing the amounts of the 2005F Water Debt Fund and/or the 2005F Bond Reserve Account, referred to in paragraphs (b) and (c) of this Section 601, or either of them, or establishing or increasing the amount of any principal and interest account or bond reserve account created by the City for the payment of any water revenue bonds of the City heretofore or hereafter issued and standing on a parity with the Bonds;

 

(iii) paying the cost of enlarging, extending or improving the System, including the acquisition of additional facilities by construction, purchase, or by operation of law from other governmental agencies and the assumption of the obligations thereof;

 

(iv) paying the principal of and interest on any general obligation bonds of the City issued to provide funds to make enlargements, extensions or improvements of the System, exclusive of bonds payable wholly or in part from assessments against property benefited;

 

(v) as and when moneys accumulate in the Surplus Account of not less than One Million Dollars ($1,000,000), the Director of Finance of the City may advertise for tenders from the Registered Owners of any Bonds which at the time are subject to redemption from moneys in the Surplus Account. Each request for tenders shall be published once in an official newspaper or journal in the City of New York, New York. Said notice shall specify the date on which sealed tenders will be received and shall be published not less than fifteen days prior

to the date so specified. A copy of said notice shall be mailed to the manager of the underwriting group that purchased the Bonds. Purchase of Bonds shall be made by the acceptance of the lowest price tenders received, such price not to exceed the redemption price;

 

(vi) calling, redeeming and paying prior to their Stated Maturity the Bonds or any other water revenue bonds of the City heretofore or hereafter issued and standing on a parity with the Bonds; or

 

(vii) paying all costs incident to the purchase or redemption of Bonds including any interest or premium thereon, or

 

(vii) making payments on capital lease obligations; or

 

(ix) any other lawful purpose in connection with the operation of the System and beneficial to governmental or municipal functions of the City.

 

No moneys credited to the Surplus Account shall ever be diverted or applied to the general governmental or municipal functions of the City so long as any of the Bonds remain Outstanding.

 

Section 602. Funding of the 2005F Bond Reserve Account.

 

The Director of Finance is hereby authorized to execute any and all agreements with a Reserve Policy Provider in order to effectuate the issuance of a Reserve Policy, specifically including but not limited to any agreement necessary in order to reimburse the Reserve Policy Provider for moneys advanced under a Reserve Policy. In the event moneys are advanced by a Reserve Policy Provider, the City shall reimburse the Reserve Policy Provider from all funds legally available to the Waterworks Revenue Fund, subject only to the payments required by subsection (a) and (b) of Section 601 and the provisions of the last paragraph of Section 601.

 

The Reserve Policy shall terminate on the earlier of the scheduled final Stated Maturity of the Bonds as of the issuance date of the Reserve Policy or the date on which no Bonds are Outstanding under this Ordinance. As long as the Reserve Policy shall be in full force and effect, the City and the Paying Agent agree to comply with the following provisions:

 

(i) In the event that moneys on deposit in the 2005F Water Debt Fund are not available to pay the amount of principal and interest coming due and the City shall so notify the Paying Agent of it and such funds have not been forwarded to the Paying Agent one business day prior to any Stated Maturity on the Bonds, then the Paying Agent shall give notice of nonpayment to the Reserve Policy Provider as provided in the Reserve Policy (the Notice of Nonpayment), duly executed by the Paying Agent certifying that funds are not available in the 2005F Water Debt Fund or the 2005F Bond Reserve Account to pay both principal of and interest on the Bonds becoming due on the next Stated Maturity, then upon the later (A) one Business Day after receipt by the Reserve Policy Provider of the Notice of Nonpayment, or (B) the Stated Maturity on the Bonds as specified in the Notice of Nonpayment presented by the Paying Agent to the Reserve Policy Provider, the Reserve Policy Provider will make a deposit of funds in an account with the Paying Agent, sufficient for the payment to the Paying Agent, of amounts which are then required to pay the principal of and interest becoming due on the Bonds on such Stated Maturity of the Bonds (as specified in the Notice of Nonpayment) up to but not in excess of the Maximum Amount, as defined in the Reserve Policy;

 

(ii) and to extent that cash has also been deposited in the 2005F Bond Reserve Account, all such cash shall be used (or investments purchased with such cash shall be liquidated and the proceeds applied as required) prior to any drawing under the Reserve Policy, and the repayment of any Policy Costs, as hereinafter defined, shall be made prior to replenishment of any such cash amounts; and if, in addition to the Reserve Policy, any other reserve fund substitute instrument (Additional Reserve Policy) is provided, drawings under the Reserve Policy and any Additional Reserve Policy, and the repayment of Policy Costs and reimbursement of amounts due under the Additional Reserve Policy, shall be made on a pro rata basis (calculated by reference to the maximum amounts available thereunder) after applying all available cash in the 2005F Reserve Account and prior to the replenishment of any such cash draws, respectively;

(iii) the City shall after submission to the Reserve Policy Provider of the Notice of Nonpayment as provided in (i) above, make available to the Reserve Policy Provider all records relating to the funds and accounts maintained under this Ordinance; and

 

(iv) the Paying Agent shall, upon receipt of moneys received from a Notice of Nonpayment under the Reserve Policy, as specified in the Notice of Nonpayment, credit to the 2005F Bond Reserve Account to the extent of moneys received pursuant to such Notice of Nonpayment and shall pay such moneys to the Registered Owners of the Series 2005F Bonds as provided in this Ordinance.

 

The repayment of any draws under the Reserve Policy shall include related reasonable expenses incurred by the Reserve Policy Provider (together with interest thereon at the Late Payment Rate, which is the lesser of (1) the greater of (A) the prime rate of JPMorgan Chase Bank in effect from time to time plus 3% per annum, or (ii) the highest rate permitted by law) (the Policy Costs). The Late Payment Rate shall be computed on the basis of the actual number of days elapsed over a year of 360 days. In the event JPMorgan Chase Bank ceases to announce its prime rate publicly, the prime rate shall be the publicly announced prime or base lending rate of such national bank as the Reserve Policy Provider shall specify. The repayment of Policy Costs shall have the same priority as the obligation to maintain and replenish the Bond Reserve Requirement. If the City shall fail to repay any Policy Costs in accordance with the requirements of this paragraph, the Reserve Policy Provider shall be entitled to exercise any and all remedies available at law or under this Ordinance other than acceleration of the maturity of the Series 2005F Bonds or remedies which would adversely affect the Registered Owners of the Series 2005F Bonds.

 

Repayment of Policy Costs shall commence in the first month following each draw, and each such monthly payment shall be in an amount at least equal to 1/12 of the aggregate of Policy costs related to such draw. Amounts in respect of Policy Costs paid to the Reserve Policy Provider shall be credited first to interest due, then to the expenses due and then to principal due. As to the extent that payments are made to the Reserve Policy Provider on account of principal due, the coverage under the Reserve Policy will be increased by a like amount, subject to the terms of the Reserve Policy.

 

If the City shall fail to pay any Policy Costs in accordance with the provisions of this Section 602, the Reserve Policy Provider shall be entitled to exercise any and all legal and equitable remedies available to it, including those provided under this Ordinance other than (1) acceleration of the Series 2005F Bonds or (2) remedies which would adversely affect owners of the Series 2005F Bonds.

 

This Ordinance shall not be discharged until all Policy Costs owing to Reserve Policy Provider shall have been paid in full. The Citys obligation to pay such amounts shall expressly survive payment in full of the Series 2005F Bonds.

 

Section 603. Transfer of Funds to Paying Agent. The Director of Finance is hereby authorized and directed to withdraw from the 2005F Water Debt Fund and, to the extent necessary to prevent a default in the payment of either principal of or interest on the Bonds, from the 2005F Bond Reserve Account and the Surplus Account as provided in Section 601, or, if funds are not available in the 2005F Water Debt Fund or the 2005F Reserve Account, make a Notice of Nonpayment under the Reserve Policy sums sufficient to pay the principal of and interest on the Bonds as and when the same become due on any Bond Payment Date, and to pay the charges for services rendered by the Bond Registrar and Paying Agent (other than the City itself) in acting as Bond Registrar and Paying Agent for the Bonds, if any, and to forward such sums to the Paying Agent no later than one business day prior to the dates when such principal interest and fees will become due. The obligations of the City to reimburse Reserve Policy Provider for any amounts paid as a result of a Notice of Nonpayment shall be subordinate to the payment of debt service on the Bonds. The amounts necessary to pay the charges of the Bond Registrar and Paying Agent shall be forwarded to the Paying Agent over and above the amount of the interest on the Bonds. The amounts held by the Paying Agent for the payment of the interest or principal due on any date with respect to particular Bonds shall, on and after such date and pending such payment, be set aside on its books and held in trust by it for the Registered of the Bonds entitled thereto.

 

Section 604. Payments Due on Saturdays, Sundays and Holidays. In the case where a Bond Payment Date is not a Business Day, then payment of principal, Redemption Price or interest need not be made on such Bond Payment Date but may be made on the next succeeding Business Day with the same force and effect as if made on such Bond Payment Date, and no interest shall accrue for the period after such Bond Payment Date.

 

Section 605. Nonpresentment of Bonds. If any Bond is not presented for payment when the principal thereof becomes due at Maturity, if funds sufficient to pay such Bond have been made available to the Paying Agent all liability of the City to the Registered Owner thereof for the payment of such Bond shall forthwith cease, determine and be completely discharged, and thereupon it shall be the duty of the Paying Agent to hold such funds, without liability for interest thereon, for the benefit of the Registered Owner of such Bond, who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on his part under this

Ordinance or on, or with respect to, said Bond. If any Bond is not presented for payment within four years following the date when such Bond becomes due at Maturity, the Paying Agent shall repay the City the funds theretofore held by it for payment of such Bond, and such Bond shall, subject to the defense of any applicable statute of limitation, thereafter be an unsecured obligation of the City, and the Registered Owner thereof shall be entitled to look only to the City for the payment, and then only to the extent of the amount so repaid to it by the Paying Agent, and the City shall not be liable for any interest thereon and shall not be regarded as a trustee of such money.

 

Section 606. Application of Moneys in the Rebate Fund.

 

(a) There shall be deposited in the Rebate Fund such amounts as are required to be deposited therein pursuant to the Tax Compliance Agreement. All money in the Rebate Fund shall be held in trust, to the extent required to satisfy the Rebate Amount (as defined in the Tax Compliance Agreement), for payment to the United States of America, and neither the City nor the Registered Owner of any Bond shall have any rights in or claim to such money. All amounts deposited into or on deposit in the Rebate Fund shall be governed by this Section 606 and the Tax Compliance Agreement.

 

(b) The City shall periodically determine the rebatable arbitrage under Section 148(f) of the Code in accordance with the Arbitrage Instruction, and the City shall make payments to the United States Government at the times and in the amounts determined under the Tax Compliance Agreement. Any funds remaining in the Rebate Fund after redemption and payment of all of the bonds and the interest thereon and payment and satisfaction of any Rebate Amount, or provision made therefor, shall be released to the City.

 

(c) Notwithstanding any other provision of this Ordinance, including in particular Article XI, the obligation to pay rebatable arbitrage to the United States and to comply with all other requirements of this Section 606 and the Tax Compliance Agreement shall survive the defeasance or payment in full of the Bonds.

 

Section 607. Deficiency of Payments into Funds or Accounts. If at any time the Revenues derived by the City from the operation of the System shall be insufficient to make any payment or credit on the date or dates specified, the City shall make good the amount of such deficiency by making payments or credits out of the first available Revenues thereafter received by the City from the operation of the System, such payments and credits being made and applied in the order specified in Section 601 of this Ordinance.

 

ARTICLE VII

DEPOSIT AND INVESTMENT OF MONEYS

 

Section 701. Investments of Moneys in Funds and Accounts. Any money held in or credited to the Waterworks Revenue Fund, the 2005F Water Debt Fund and the Surplus Account may be invested by the City in Permitted Investments, provided, however, that no such investment shall be made for a period extending longer than the date when the moneys invested may be needed for the purpose for which such fund or account was created. Cash moneys in each of the funds and accounts created or established in the Ordinance shall be deposited in a bank or banks in the City of Kansas City, Missouri, which are members of the Federal Deposit Insurance Corporation and all such bank deposits shall be secured by the banks holding such deposits as required by the Citys Charter and Administrative Code.

 

The interest on any investments held in any fund or account created by or referred to in this Ordinance shall accrue to and become a part of the Waterworks Revenue Fund, except that if and when the amount held in the 2005F Bond Reserve Account shall be less than the Bond Reserve Requirement, then at all such times the interest earned on investments or money held in the 2005F Bond Reserve Account shall be deposited in the 2005F Bond Reserve Account. In determining the amount held in any fund or account under any of the provisions of this Ordinance, obligations of the United States Government shall be valued at the market value thereof. The value of such investments shall be determined at least annually. If and when the amount held in any fund or account shall be in excess of the amount required by the provisions of this Ordinance, the City, by and through its Director of Finance, may direct that such excess be paid into the Waterworks Revenue Fund.

 

ARTICLE VIII

GENERAL COVENANTS, REPRESENTATIONS AND PROVISIONS

 

Section 801. General Covenants. The City covenants and agrees with each of the Registered Owners of any of the Bonds and the Bond Insurer, that so long as any of said Bonds remain Outstanding:

 

(a) The City will continuously own and will operate the System in an efficient and economical manner and will keep and maintain the same in good condition, repair and working order. The System will be operated on the basis of the same Fiscal Year on which the City operates.

 

(b) The City will fix and maintain rates and make and collect charges for the use and services of the System sufficient to produce Revenues to pay the cost of maintenance and operation thereof, to pay the principal of and the interest on the Bonds, to provide in each Fiscal Year Net Revenues plus Administrative Service Fees not less than 110% of the amount required to be paid in the current Fiscal Year on account of principal of and interest on all obligations payable from the revenues of the System at the time outstanding, including capital lease payments, if any, (taking into account any scheduled mandatory redemptions) and to provide funds ample to meet the requirements of this Ordinance, including Policy Costs as defined in Section 601(d) hereof, and it will revise said rates from time to time so as fully to meet said requirements and the requirements of the statutes of the State of Missouri.

 

(c) None of the facilities or services afforded by the System will be furnished to any water user, without a reasonable charge being made therefor.

 

(d) The City will not mortgage, pledge or otherwise encumber the System, nor will it sell, lease or otherwise dispose of the System or any substantial part thereof; provided, however, the City may sell at fair market value any portion of such property which shall have been replaced by other similar property of at least equal value, or which shall cease to be necessary for efficient operation of the System, and in the event of sale, the City will apply the proceeds to either (i) redemption of Outstanding Parity Bonds or water revenue bonds hereafter issued on a parity with the Bonds in accordance with the provisions governing prepayment of bonds in advance of maturity or (ii) replacement of the property so disposed of by other property the revenues of which shall be incorporated into the System as hereinbefore provided; and provided further, however, that the City, with the written approval of the Director of the Water Services, may dispose of any property which has become obsolete, nonproductive or otherwise unusable to the advantage of the City.

 

(e) The City will carry and maintain reasonable and adequate insurance upon all of the properties forming a part of the System which may be of an insurable nature, such insurance to be of the character and coverage and for such amount or amounts as is customarily carried and maintained by other municipalities rendering service of a similar character. In the event of loss or damage, the City will use the proceeds of such insurance in reconstructing and replacing the property damaged or destroyed, or if such reconstruction or replacement be unnecessary, then in redeeming and paying the Citys outstanding water revenue bonds, including only the Bonds, the Outstanding Parity Bonds or other water revenue bonds of the City heretofore or hereafter issued and standing on a parity with the Bonds, or for purchasing at the market price thereof any of said bonds. The cost of all insurance shall be paid as an operating cost out of the Revenues of the System. Nothing in this Ordinance shall be construed as preventing the City from satisfying the insurance requirements herein set forth through self insurance or the Citys risk retention program.

 

(f) The City will maintain and keep proper books, records and accounts (separate from all other records and accounts) in which complete and correct entries will be made of all dealings and transactions relating to the System. Such accounts shall show the Revenues received from the System, the application of such Revenues, and all financial transactions in connection therewith. In accordance with the provisions of Section 85, Article IV, of the Citys Charter, the Council will provide that an independent certified audit of the Citys books and records relating to the System will be made annually by certified public accountants, experienced and qualified in municipal and governmental accounting. Each such audit shall be detailed in scope and said accountants shall certify as to the correctness of the schedules contained in the audit report.

 

The annual financial report relating to the Citys finances, required by Section 96, Article IV, of the Charter, shall contain complete statements covering the results of the years operations and the financial condition of the System. Said statements shall bear the certificate of the firm of certified public accountants making the annual audit. A copy of each such annual report will be filed with the City Clerk and will be open for public inspection, and a copy will be forwarded promptly without cost to the manager of the underwriting group purchasing the Bonds.

 

If such audit and report shall disclose that proper provision has not been made for all of the requirements of the law under which the Bonds are issued, and of this Ordinance, the City covenants and agrees that it will promptly proceed to cause to be charged for the services rendered by the System rates which will adequately provide for such requirements.

 

(g) The Registered Owner or Registered Owners of not less than ten percent (10%) in aggregate principal amount of the Bonds at the time Outstanding, or their duly authorized representative, shall have the right at all reasonable times to inspect the System, and all records, accounts and data relating thereto, and such Registered Owners or their representative shall be furnished by the City with all such information concerning the System and the operation thereof which may be reasonably requested.

 

(h) The City hereby represents and covenants that the Bonds directed to be issued by this Ordinance are issued in full compliance with the restrictions and conditions upon the issuance of additional parity bonds as set forth and contained in the Parity Ordinances, and that the Bonds herein directed to be issued are issued in all respects on a parity and equality with the Outstanding Parity Bonds heretofore issued and outstanding.

 

(i) The City will punctually perform all duties with respect to the operation of the System now or thereafter imposed upon the City by the Constitution and laws of the State, and including all other duties and obligations imposed by law, and by the provisions of this Ordinance. The City further covenants not to issue parity debt or subordinate debt in any manner that inhibits the issuance of bonds or other refunding obligations.

 

Section 802. Administrative Personnel. The City shall use its best efforts to employ at all times administrative personnel experienced and well qualified to operate the System. The City further agrees that such administrative personnel shall be employed in sufficient numbers to ensure that the System will be operated in a prudent and efficient manner, following procedures generally accepted within the United States of America.

 

Section 803. Parity Bond Certification. The City represents and covenants that the Bonds directed to be issued by this Ordinance are so issued in full compliance with the restrictions and conditions upon which the City may issue additional bonds payable out of the revenues derived from the operation of the System and which stand on a parity with the Parity Bonds heretofore issued and outstanding, as set forth and contained in the Parity Ordinances under which such Parity Bonds have been issued, and that the Bonds herein directed to be issued are so issued in all respects on a parity and equality with the Parity bonds heretofore issued and outstanding.

 

Section 804. Tax Covenants.

 

(a) The City covenants that (1) it will comply with all applicable provisions of the Code, including Sections 103 and 141 through 150, necessary to maintain the exclusion from federal gross income of the interest on the Bonds and (2) it will not use or permit the use of any proceeds of Bonds or any other funds of the City, nor take or permit any other action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from federal gross income of the interest on the Bonds. The City will also adopt such other ordinances or resolutions and take such other actions as may be necessary to comply with the Code and with all other applicable future law in order to ensure that the interest on the Bonds will remain excluded from federal gross income, to the extent any such actions can be taken by the City.

 

(b) The City covenants and agrees that (1) it will use the proceeds of the Bonds as soon as practicable for the purposes for which the Bonds are issued, and (2) it will not invest or directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the City in any manner, or take or omit to take any action, that would cause the Bonds to be arbitrage bonds within the meaning of Section 148(a) of the Code.

 

(c) The City covenants that it will pay or provide for the payment from time to time of all rebatable arbitrage to the United States pursuant to Section 148(f) of the Code and the Tax Compliance Agreement. This covenant shall survive payment in full or defeasance of the Bonds. The Tax Compliance Agreement may be amended or replaced if, in the opinion of Bond Counsel, such amendment or replacement will not adversely affect the exclusion from federal gross income of the interest on the Bonds.

 

(d) The City represents that (1) it is a governmental unit under Missouri law with general taxing powers, (2) none of the Bonds is a private activity bond within the meaning of Section 141 of the Code and (3) ninety-five percent (95%) or more of the net proceeds of the Bonds will be used for local government activity of the City.

 

(e) The foregoing covenants shall remain in full force and effect notwithstanding the defeasance of the Bonds pursuant to Article XI or any other provision of this Ordinance until the final Stated Maturity of all Bonds Outstanding.

 

ARTICLE IX

ADDITIONAL BONDS AND OBLIGATIONS

 

Section 901. Senior Lien Bonds. The City covenants and agrees that so long as any of the Bonds remain Outstanding the City will not issue any additional bonds or incur or assume any other debt obligations appearing as liabilities on the balance sheet of the City for the payment of moneys determined in accordance with generally accepted accounting principles consistently applied, including capital leases as defined by generally accepted accounting principles, payable out of the Net Revenues of the System or any part thereof which are superior to the Bonds.

 

Section 902. Parity Lien Bonds and Other Obligations. The City further covenants and agrees that, except as hereinafter in this Section 902 provided, the City will not issue any such additional bonds or other obligations on a parity or equality with the Bonds unless each of the following conditions are met:

 

(a) (1) The City shall not be in default in making any payment of principal of or interest on any Bonds or any Parity Bonds at the time Outstanding or in making any payment at the time required to be made into the respective funds and accounts created by and referred to in this Ordinance or any Parity Ordinance (unless such additional revenue bonds or obligations are being issued to provide funds to cure such default), and (2) the Bond Reserve Accounts for the Outstanding Parity Bonds, including the Additional Bonds proposed to be issued and standing on a parity with the Bonds are fully funded at the Bond Reserve Requirement, in either case unless otherwise permitted by the Bond Insurer; and

 

(b) for so long as any of the Series D Bonds, the Series 1996A Bonds, the Series 1996B Bonds, the Series 1998A Bonds, the Series 1998B Bonds, the Series 2000A Bonds and the Series 2002C Bonds remain Outstanding, the Net Revenues for the Fiscal Year which ended next preceding the authorization of additional bonds shall have been equal to at least 120% of the maximum amount required to be paid out of said Net Revenues in any succeeding Fiscal Year on account of both principal and interest becoming due (taking into account scheduled mandatory redemptions, if any) including Policy Costs as defined in Section 601(d) hereof, with respect to all water revenue obligations of the City (excluding subordinate revenue bonds and any other subordinate obligations), including the additional revenue bonds proposed to be issued, provided, however, that if the City shall have made an increase in its water service charges and such increased charges have not been in effect during the entire Fiscal Year which ended next preceding the authorization of additional bonds, then the City may obtain a report from the Consulting Engineer as to the amount of Net Revenues that the City will derive from the operation of the System during the next full Fiscal Year in which such new rates are in effect, which may be the Fiscal Year in which the proposed additional revenue bonds are issued, and if said engineer or engineers shall certify:

 

(i) that on the basis of such new rates the Net Revenues of the System for such full Fiscal Year in which such new rates are in effect, will be equal to at least 120% of the maximum amount required to be paid out of said Net Revenues in any succeeding Fiscal Year on account of both principal and interest including Policy Costs as defined in Section 601(d) hereof, becoming due with respect to all water revenue obligations of the City (excluding subordinate revenue bonds and any other subordinate obligations), including the additional revenue bonds proposed to be issued, and

 

(ii) that the issuance of the additional water revenue bonds proposed to be issued is advisable and will not impair the ability of the City to pay when due the principal of or interest on the Bonds or to meet all obligations resting upon the City by reason of the covenants and agreements contained in this Ordinance, then the City may issue such additional water revenue bonds.

 

(c) for so long as any of the Series 2004D Bonds and the Series 2005F Bonds remain Outstanding, the average Net Revenues plus average Administrative Service Fees for the two most recent annual audits for the Fiscal Years preceding the issuance of additional bonds shall have been equal to at least 120% of the maximum amount required to be paid out of said Net Revenues in any succeeding Fiscal Year on account of both principal and interest becoming due (taking into account scheduled mandatory redemptions, if any) including Policy Costs as defined in Section 601(d) hereof, with respect to all water revenue obligations of the City (excluding subordinate revenue bonds and any other subordinate obligations), including the additional revenue bonds proposed to be issued, provided, however, that if the City shall have made an increase in its water service charges and such increased charges were not in effect during the two most recent Fiscal Years for which annual audits are available, then the City may obtain a report from the Consulting Engineer as to the amount of adjusted Net Revenues that the City would have derived from the operation of the System if the new rates had been in effect during the entire period or will derive from the operation of the System during the next full Fiscal Year in which such new rates are in effect, which may be the Fiscal Year in which the proposed additional revenue bonds are issued, and if said engineer or engineers shall certify:

 

(i) that on the basis of such increased rates the average adjusted Net Revenues of the System plus average Administrative Service Fees for the two most recent Fiscal Years for which annual audits are available would have been, or the adjusted Net Revenues of the System plus Administrative Service Fees for the full Fiscal Year in which such new rates are in effect, will be equal to at least 120% of the maximum amount required to be paid out of said Net Revenues in any succeeding Fiscal Year on account of both principal and interest including Policy Costs as defined in Section 601(d) hereof, becoming due with respect to all water revenue obligations of the City (excluding subordinate revenue bonds and any other subordinate obligations), including the additional revenue bonds proposed to be issued, and

 

(ii) that the issuance of the additional water revenue bonds proposed to be issued is advisable and will not impair the ability of the City to pay when due the principal of or interest on the Bonds or to meet all obligations resting upon the City by reason of the covenants and agreements contained in this Ordinance, then the City may issue such additional water revenue bonds.

 

Additional Bonds of the City issued under the conditions hereinbefore in this Section 902 set forth shall stand on a parity with the Bonds and shall enjoy complete equality of lien on and claim against the revenues of the System with the Bonds and the City may make equal provision for paying said bonds and the interest thereon out of the Waterworks Revenue Fund and may likewise provide for the creation of a reasonable principal and interest account and a reasonable bond reserve account for the payment of such Additional Bonds and the interest thereon out of moneys in the Waterworks Revenue Fund.

 

Nothing in this Section 902 shall prohibit or restrict the right of the City to issue additional bonds or other revenue obligations for the purpose of reconstructing, altering, repairing, enlarging, extending or improving the System and to provide that the principal of and interest on said revenue bonds or obligations shall be payable out of the Revenues of the System, provided at the time of the issuance of such additional revenue bonds or obligations the City shall not be in default in the performance of any covenant or agreement contained in this Ordinance, and provided further that such additional revenue bonds or obligations shall be junior or subordinate to the Bonds so that if at any time the City shall be in default in paying either interest on or principal of the Bonds, or if the City shall be in default in making any payments required to be made by it under the provisions of this Ordinance, the City shall make no payments of either principal of or interest on said junior and subordinate revenue bonds or obligations until said default or defaults be cured and no default shall exist on the part of the City under the covenants, agreements and conditions contained in this Ordinance. In the event of the issuance of any such junior and subordinate revenue bonds or obligations, the City, subject to the provisions aforesaid, may make provisions for paying the principal of and interest on said revenue bonds or obligations out of moneys in the Waterworks Revenue Fund.

 

Section 903. Refunding Bonds. The City shall have the right, without complying with the provisions of Section 902, to refund any of the Bonds under the provisions of any law then available, and the refunding bonds so issued shall enjoy complete equality of pledge with any of the Bonds which are not refunded, if any, upon the Revenues of the System; provided, however, that if only a portion of the Bonds are refunded and if the Bonds are refunded in such manner that the refunding bonds bear a higher average rate of interest or become due on a date earlier than that of the Bonds which are refunded, then such Bonds may be refunded without complying with the provisions of Section 902 only by and with the written consent of the Registered Owners of a majority in principal amount of the Bonds not refunded.

 

ARTICLE X

DEFAULT AND REMEDIES

 

Section 1001. Acceleration of Maturity in Event of Default. The City covenants and agrees that if it shall default in the payment of the principal of or interest on any of the Bonds as the same shall become due on any Bond Payment Date, or if the City or the Council of the City or any of the officers, agents, or employees thereof shall fail or refuse to comply with any of the provisions of this Ordinance or of the constitution or statutes of the State, and such default continues for a period of thirty (30) days, or such extended period as is approved with the prior written consent of the Bond Insurer, after written notice specifying such default has been given to the City by the Bond Insurer or the Registered Owner of any Bond then Outstanding, then, at any time thereafter and while such default continues, the Bond Insurer or the Registered Owners of twenty-five percent (25%) in principal amount of the Bonds then Outstanding may with the prior written consent of the Bond Insurer, by written notice to the City filed in the office of the City Clerk or delivered in person to the City Clerk, declare the principal of all Bonds then Outstanding to be due and payable immediately, and upon any such declaration given as aforesaid, all of the Bonds shall become and be immediately due and payable, anything in this Ordinance or in the Bonds contained to the contrary notwithstanding. This provision, however, is subject to the condition that if at any time after the principal of the Outstanding Bonds has been so declared to be due and payable, all arrears of interest upon all Outstanding Bonds, except interest accrued but not yet due on such Bonds, and all arrears of principal upon all of said Bonds shall have been paid in full, and all other defaults, if any, by the City under the provisions of this Ordinance and under the provisions of the statutes of the State shall have been cured, then and in every such case, the Bond Insurer or the Registered Owners of a majority in principal amount of the Bonds then Outstanding may with the prior written consent of the Bond Insurer, by written notice to the City given as hereinbefore specified, rescind and annul such declaration and its consequences, but no such rescission or annulment shall extend to or affect any subsequent default or impair any rights consequent thereon. The City shall give prompt written notice to the Bond Insurer upon any default hereunder.

 

In the event the maturity of the Bonds is accelerated pursuant to this Section, the Bond Insurer may elect, in its sole discretion, to pay accelerated principal and interested accrued on such principal to the date of acceleration (to the extent unpaid by the City) and the Paying Agent shall be required to accept such amounts. Upon payment of such accelerated principal and interested accrued to the acceleration as provided above, the Bond Insurers obligations under the Bond Insurance Policy with respect to such Bonds shall be fully discharged.

 

After payment of reasonable expenses of the Paying Agent, the application of funds realized upon default shall be applied to payment of expenses of the City or rebate only after payment of debt service due and past due on the Bonds, together with replenishment of the 2005F Bond Reserve Account.

 

Section 1002. Other Remedies. The provisions of this Ordinance, including the covenants and agreements herein contained, shall constitute a contract between the City, the Bond Insurer and the Registered Owners of the Bonds, and the Bond Insurer or the Registered Owner or Registered Owners of not less than ten percent (10%) in principal amount of the Bonds at the time Outstanding, with the consent of the Bond Insurer, shall have the right for the equal benefit and protection of all Registered Owners of Bonds similarly situated:

 

(a) by mandamus or other suit, action or proceeding at law or in equity to enforce such Registered Owners rights against the City and its officers, agents and employees, and to require and compel duties and obligations required by the provisions of this Ordinance or by the constitution and laws of the State;

 

(b) by suit, action or other proceeding in equity or at law to require the City, its officers, agent and employees to account as if they were the trustees of an express trust; and

 

(c) by suit, action or other proceeding in equity or at law to enjoin any acts or things which may be unlawful or in violation of the rights of the Registered Owners of the Bonds.

 

Nothing contained in this Ordinance, however, shall be construed as imposing on the City any duty or obligation to levy any taxes either to meet any obligation incurred herein or to pay the principal of or interest on the Bonds.

 

No remedy conferred hereby upon the Bond Insurer or any Registered Owner is intended to be exclusive of any other remedy, but each such remedy is cumulative and in addition to every other remedy and may be exercised without exhausting and without regard to any other remedy conferred hereby. No waivers of any default or breach of duty or contract by the Registered Owner shall extend to or affect any subsequent default or breach of duty or contract or shall impair any rights or remedies thereon. No delay or omission of the Registered Owner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Registered Owners may be enforced from time to time and as often as may be deemed expedient. In any suit, action or proceeding to enforce any right or exercise any remedy shall be brought or taken and then discontinued or abandoned, or shall be determined adversely to the Registered Owner, then, and in every such case, the City and the Registered Owners shall be restored to their former positions and rights and remedies as if no such suit, action or other proceeding had been brought or taken.

 

Notwithstanding any other provisions of this Ordinance, in determining whether the rights of the Registered Owners will be adversely affected by an action taken pursuant to the terms and provisions of this Ordinance, the City shall consider the effect on the Registered Owners as if there were no Reserve Policy.

 

Section 1003. Limitations on Rights of Bondowners. No one or more Bondowners secured hereby shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security granted and provided for herein, or to enforce any right hereunder, except in the manner herein provided, and all proceedings at law or in equity shall be instituted, had and maintained for the equal benefit of all Registered Owners of such Outstanding Bonds.

 

Section 1004. Remedies Cumulative. No remedy conferred herein upon the Bondowners is intended to be exclusive of any other remedy, but each such remedy shall be cumulative and in addition to every other remedy and may be exercised without exhausting and without regard to any other remedy conferred herein. No waiver of any default or breach of duty or contract by the Registered Owner of any Bond shall extend to or affect any subsequent default or breach of duty or contract or shall impair any rights or remedies consequent thereon. No delay or omission of any Bondowner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Registered Owners of the Bonds by this Ordinance may be enforced and exercised from time to time and as often as may be deemed expedient. If any suit, action or proceedings taken by any Bondowner on account of any default or to enforce any right or exercise any remedy has been discontinued or abandoned for any reason, or has been determined adversely to such Bondowner, then, and in every such case, the City and the Registered Owners of the Bonds shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies, powers and duties of the Bondowners shall continue as if no such suit, action or other proceedings had been brought or taken.

 

Section 1005. No Obligation to Levy Taxes. Nothing contained in this Ordinance shall be construed as imposing on the City any duty or obligation to levy any taxes either to meet any obligation incurred herein or to pay the principal of or interest on the Bonds.

 

Section 1006. Provisions Relating to the Bond Insurer. The provisions of this Section 1006 shall govern, notwithstanding anything to the contrary set forth in this Ordinance.

 

(a) In determining whether any amendment, consent or other action to be taken, or any failure to act, under this Ordinance would adversely affect the security for the Bonds or the rights of the Bondowners, the Paying Agent shall consider the effect of any such amendment, consent, action or inaction as if there were no Bond Insurance Policy.

 

(b) No contract shall be entered into nor any action taken by which the rights of the Bond Insurer or security for or sources of payment of the Bonds may be impaired or prejudiced in any material respect except upon obtaining the prior written constant of the Bond Insurer.

 

(c) The City shall pay or reimburse the Bond Insurer any and all charges, fees, costs and expenses which the Bond Insurer may reasonably pay or incur in connection with (1) the administration, enforcement, defense or preservation of any rights or security in the Bonds or this Ordinance, (2) the pursuit of any remedies under this Ordinance or the Bonds or otherwise as afforded by law or equity, (3) any amendment, waiver or other action with respect to, or related to, this Ordinance or the Bonds whether or not executed or completed, or (4) any litigation or other dispute in connection with this Ordinance or the Bonds or the transactions contemplated thereby, other than amounts resulting from the failure of the Bond Insurer to honor its obligations under the Bond Insurance Policy. The Bond Insurer reserves the right to charge a reasonable fee as a condition to executing any amendment, waiver or consent proposed in respect of this Ordinance or the Bonds.

 

(d) The Bond Insurer shall be provided with the following information:

 

(1) (i) Annual audited financial statements within the later of (A) 150 days after the end of the Citys fiscal year or (B) within 30 days of availability, (together with certification of the City that it is not aware of any default under the Ordinance), and (ii) the Citys annual budget within 30 days after the approval thereof with such other information, data or reports a the Bond Insurer shall reasonably request from time to time;

 

(2) Notice of any draw upon the 2005F Bond Reserve Account within two Business Days after knowledge thereof other than (A) withdrawals of amounts in excess of the Bond Reserve Requirement and (B) withdrawals in connection with a refunding of the Bonds;

 

(3) Notice of any default known to the Paying Agent or the City within five Business Days after knowledge thereof;

 

(4) Prior notice of the advance refunding or redemption of any of the Bonds, including the principal amount, maturities and CUSIP numbers thereof;

 

(5) Notice of the resignation or removal of the Paying Agent and Bond Registrar and the appointment of, and acceptance of duties by, any successor thereto;

 

(6) Notice of the commencement of any proceeding by or against the City commenced under the United States Bankruptcy Code or any other applicable bankruptcy, insolvency, receivership, rehabilitation or similar law (an Insolvency Proceeding);

 

(7) Notice of the making of any claim in connection with any Insolvency Proceeding seeking the avoidance as a preferential transfer of any payment of principal of, or interest on, the Bonds;

 

(8) A full transcript of all proceedings relating to the execution of any amendment or supplement to this Ordinance or the Bonds; and

 

(9) All reports, notices and correspondence to be deliver to the Bondowners under the terms of this Ordinance and the Bonds.

 

(e) The Bond Insurer shall be deemed a third party beneficiary of this Ordinance.

 

(f) The rights granted to the Bond Insurer under this Ordinance or the Bonds to request, consent to or direct any action are rights granted to the Bond Insurer in consideration of its issuance of the Bond Insurance Policy. Any exercise by the Bond Insurer of such rights is merely an exercise of the Bond Insurers contractual rights and shall not be construed or deemed to be taken for the benefit or on behalf of the Bondowners nor does such action evidence any position of the Bond Insurer, positive or negative, as to whether Bondowner consent is required in addition to consent of the Bond Insurer.

 

(g) All notices to the Bond Insurer shall be addressed as follows:

 

Financial Security Assurance Inc.

31 West 52nd Street

New York, New York 10019

Attention: Managing Director Surveillance

Re: Policy No. [To be inserted]

Telephone: (212) 826-0100

Facsimile: (212) 339-3556

 

In each case in which notice or other communication refers to an event of default, then a copy of such notice or other communication shall also be sent to the attention of the General Counsel and shall be marked to indicate URGENT MATERIAL ENCLOSED.

 

(h) Notwithstanding any other provision to the contrary contained in this Ordinance, for all purposes of the provisions of this Ordinance governing events of default and remedies, except the giving of notice of default to Bondowners, the Bond Insurer shall be deemed to be the sole Bondowner for the purpose of exercising any voting right or privilege or giving any consent or direction or taking any action that the holders of the Bonds insured by it are entitled to take pursuant to this Ordinance for so long as it is not in default of its payment obligations under the Bond Insurance Policy.

 


ARTICLE XI

DEFEASANCE

 

Section 1101. Defeasance. When any or all of the Bonds or the interest payments thereon have been paid and discharged, then the requirements contained in this Ordinance and the pledge of Net Revenues made hereunder and all other rights granted hereby shall terminate with respect to the Bonds so paid and discharged. Bonds or the interest payments thereon shall be deemed to have been paid and discharged within the meaning of this Ordinance if there has been deposited with the Paying Agent, or other commercial bank or trust company located in the State and having full trust powers, at or prior to the Stated Maturity or Redemption Date of such Bonds, in trust for and irrevocably appropriated thereto, moneys and/or Defeasance Obligations which, together with the interest to be earned thereon, will be sufficient for the payment of the principal of or Redemption Price of such Bonds, and/or interest to accrue on such Bonds to the Stated Maturity or Redemption Date, as the case may be, or if default in such payment shall have occurred on such date, then to the date of the tender of such payments; provided, however, that if any such Bonds shall be redeemed prior to the Stated Maturity thereof, (1) the City shall have elected to redeem such Bonds, and (2) either notice of such redemption shall have been given, or the City shall have given irrevocable instruction, or shall have provided for an escrow agent to give irrevocable instructions, to the Paying Agent to redeem such Bonds in compliance with Section 302(a) of this Ordinance. Any moneys and Defeasance Obligations that at any time shall be deposited with the Paying Agent or other commercial bank or trust company by or on behalf of the City, for the purpose of paying and discharging any of the Bonds or the interest payments thereon, shall be and are hereby assigned, transferred and set over to the Paying Agent or other bank or trust company in trust for the respective Registered Owners of the Bonds, and such money shall be and are hereby irrevocably appropriated to the payment and discharge thereof. All moneys and Defeasance Obligations deposited with the Paying Agent or other bank or trust company shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance.

 

In the event of an advance refunding, the City shall cause to be delivered (1) a verification report of an independent firm of national recognized certified public accountants or such other accountant as shall be acceptable to the Bond Insurer, verifying the sufficiency of the escrow established to pay the Bonds in full on the maturity or redemption date, which verification report shall be acceptable in form and substance to the Bond Insurer and shall be addressed to the Bond Insurer and the City, (2) an escrow deposit agreement, which shall be acceptable in form and substance to the Bond Insurer, (3) an opinion of Bond Counsel to the effect that the Bonds are no longer Outstanding, which opinion shall be acceptable in form and substance to the Bond Insurer and addressed to the Bond Insurer and the City. The Bond Insurer shall be provided with final drafts of the above-referenced documentation not less than five Business Days prior to the funding of the escrow.

 

Notwithstanding any provisions of this Article XI to the contrary, this Ordinance shall remain in full force and effect until all payments due to the Bond Insurer for amounts paid by the Bond Insurer under the Bond Insurance Policy and all payments due to the Reserve Policy Provider for Policy Costs have been paid in full. The Citys obligation to pay all Policy Costs owing to the Reserve Policy Provider shall expressly survive payment in full of the Bonds.

 

 

ARTICLE XII

MISCELLANEOUS PROVISIONS

 

Section 1201. Consent of Reserve Policy Provider. The Reserve Policy Providers consent hereunder shall be required in addition to consent of the Registered Owners, when required, for the following purposes: (i) execution and delivery of any supplemental Ordinance or any amendment hereof or thereof: (ii) removal of the Paying Agent or selection and appointment of any successor paying agent; and (iii) initiation or approval of any action not described in (i) or (ii) above which requires consent of the Registered Owners.

 

Section 1202. Information to be Given to Reserve Policy Provider. While the Reserve Policy is in effect, the City shall furnish to the Reserve Policy Provider the information required by the Terms Ordinance.

 

Section 1203. Amendments. The rights and duties of the City and the Bondowners, and the terms and provisions of the Bonds or of this Ordinance, may be amended or modified at any time in any respect by ordinance of the City with the prior written consent of the Bond Insurer or the Registered Owners of not less than a majority in aggregate principal amount of the Bonds then Outstanding with the prior written consent of the Bond Insurer; such consent to be evidenced by an instrument or instruments executed by such Registered Owners or the Bond Insurer, as applicable, and duly acknowledged or proved in the manner of a deed to be recorded, and such instrument or instruments shall be filed with the City Clerk, but no such modification or alteration shall:

 

(a) extend the maturity of any payment of principal or interest due upon any Bonds;

 

(b) effect a reduction in the amount which the City is required to pay by way of principal of or interest on any Bonds;

 

(c) permit the creation of a lien on the Revenues of the System prior or equal to the lien of the Bonds or Parity Bonds;

 

(d) permit preference or priority of any Bonds over any other Bonds; or

 

(e) reduce the percentage in principal amount of Bonds required for the written consent to any modification or alteration of the provisions of this Ordinance.

 

Any provision of the Bonds or of this Ordinance may, however, be amended or modified by ordinance duly adopted by the Council of the City at any time in any respect with the written consent of the Bond Insurer or the Registered Owners of all of the Bonds at the time Outstanding with the prior written consent of the Bond Insurer.

 

Without notice to or the consent of any Bondowners, but with the prior written consent of the Bond Insurer, the City may amend or supplement this Ordinance for the purpose of curing any formal defect, omission, inconsistency or ambiguity therein or in connection with any other change therein which is not materially prejudicial to the interests of the Bondowners.

 

Every amendment or modification of a provision of the Bonds or of this Ordinance, to which the written consent of the Bondowners or the Bond Insurer is given, as above provided, shall be expressed in an ordinance adopted by the Council of the City amending or supplementing the provisions of this Ordinance and shall be deemed to be a part of this Ordinance. A certified copy of every such amendatory or supplemental ordinance, if any, and a certified copy of this Ordinance shall always be kept on file in the office of the City Clerk, and shall be made available for inspection by the Registered Owner of any bond or a prospective purchaser or owner of any bond authorized by this Ordinance, and upon payment of the reasonable cost of preparing the same, a certified copy of any such amendatory or supplemental ordinance or of this Ordinance will be sent by the City Clerk to any such Bondowner or prospective Bondowner.

 

Any and all modifications made in the manner hereinabove provided shall not become effective until there has been filed with the City Clerk a copy of the ordinance of the City hereinabove provided for, duly certified, as well as proof of any required consent to such modification by the Bond Insurer or the Registered Owners of the Bonds then Outstanding. It shall not be necessary to note on any of the Outstanding Bonds any reference to such amendment or modification.

 

The City shall furnish the Paying Agent a copy of any amendment to the bonds or this Ordinance made hereunder which affects the duties or obligations of the Paying Agent under this Ordinance. Copies of any modification or amendment to the bonds or this Ordinance shall also be sent to Standard & Poors Credit Market Services and Moodys Investors Service, Inc. at least 10 days prior to the effective date thereof.

 

Notwithstanding any provisions of this Section 1203 to the contrary, so long as the Reserve Policy shall remain in effect, this Ordinance shall not be modified or amended without the prior written consent of the Reserve Policy Provider.

 

Section 1204. Notices, Consents and Other Instrument by Bondowners. Any notice, consent, request, direction, approval, objection or other instrument required by this Ordinance to be signed and executed by the Bondowners may be in any number of concurrent writings of similar tenor and may be signed or executed by such Bondowners in person or by an agent appointed in writing. Proof of the execution of any such instrument or of the writing appointing any such agent and of the ownership of Bonds, if made in the following manner, shall be sufficient for any of the purposes of this Ordinance, and shall be conclusive in favor of the City and the Paying Agent with regard to any action taken, suffered or omitted under any such instrument, namely:

 

(a) The fact and date of the execution by any Person of any such instrument may be proved by the certificate of any officer in any jurisdiction who by law has power to take acknowledgments within such jurisdiction that the person signing such instrument acknowledged before such officer the execution thereof, or by affidavit of any witness to such execution.

 

(b) The fact of ownership of Bonds and the amount or amounts, numbers and other identification of such Bonds, and the date of holding the same shall be proved by the Bond Register.

 

In determining whether the Registered Owners of the requisite principal amount of Bonds Outstanding have given any request, demand, authorization, direction, notice, consent or waiver under this Ordinance, Bonds owned by the City shall be disregarded and deemed not to be Outstanding under this Ordinance, except that, in determining whether the Bondowners shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Bonds which the Bondowners know to be so owned shall be so disregarded. Notwithstanding the foregoing, Bonds so owned which have been pledged in good faith shall not be disregarded as aforesaid if the pledgee establishes to the satisfaction of the Bondowners the pledgees right so to act with respect to such Bonds and that the pledgee is not the City.

 

Section 1205. Further Authority. The officers of the City, including the Mayor and the City Clerk, shall be, and they hereby are, authorized and directed to execute all documents and take such actions as they deem necessary or advisable in order to carry out and perform the purposes of this Ordinance and to make ministerial alterations, changes or additions in the foregoing agreements, statements, instruments and other documents herein approved, authorized and confirmed which they may approve and the execution or taking of such action shall be conclusive evidence of such necessity or advisability.

 

Section 1206. Continuing Disclosure. The City covenants and agrees to enter into a Continuing Disclosure Agreement for the benefit of the Bondholders or similar undertaking intended to satisfy the ongoing disclosure requirements of Securities and Exchange Commission Rule 15c2-12. The Director of Finance is authorized to enter in a Continuing Disclosure Agreement substantially in the form on file with the office of the Director of Finance, with such changes therein as she deems necessary or desirable.

 

Section 1207. Severability. If any section or other part of this Ordinance, whether large or small, is for any reason held invalid, the invalidity thereof shall not affect the other provisions of this Ordinance.

 

Section 1208. Electronic Storage. The City agrees that the transaction described herein may be conducted and related documents may be stored by electronic means.

 

Section 1209. Governing Law. This Ordinance shall be governed exclusively by and construed in accordance with the applicable laws of the State.

______________________________________________

 

Approved as to form and legality:

 

 

_____________________________

Heather A. Brown

Assistant City Attorney