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HomeMy WebLinkAbout2008-OR-09ORDINANCE NO. Q H-OR'9 An Ordinance of the City of Jeffersonville authorizing the issuance of sewage works revenue bonds for the purpose of providing funds to pay the cost of certain additions, extensions and improvements to the municipal sewage works of said City, providing for the safeguarding of the interests of the owners of said bonds, other matters connected therewith, including the issuance of notes in anticipation of bonds, and repealing ordinances inconsistent herewith WHEREAS, the Ciry of Jeffersonville, Indiana ("City") has heretofore established, wnstructed and financed a municipal sewage works and now owns and operates the sewage works pursuant to IC 36-9-23, and other applicable laws; and WHEREAS, the Common Council of the City (°CounciL") did on June 6, 2005, adopt Ordinance No. 2005-OR-22 ("2005 Ordinance") which authorized the hereinafter defined 2005 bonds which were issued to provide financing for a portion of the projects described on Exhibit A attached hereto; and WHEREAS, the Council now finds that it is necessary to include additional improvements, additions and extensions to the projects authorized under the 2005 Ordinance, and that preliminary plans, specifications and estimates have been prepared and filed by the engineers employed by [he Ciry for [he consh'uction of said improvements and extensions, as more fully described on Exhibi[6 attached hereto ("ProjecP'), which preliminary plans and specifications have been or will be approved by the Council and by all governmental authorities having jurisdiction, including, particularly, the Indiana Department of Environmental Management (°Department"): and WHEREAS. for purposes of tltis ordinance, the p~njects set forth on Exhibit A not otherwise funded with the 2005 Bonds and the projects se[ forth on F,xhibi[ !3 shall be eollectivcly re fened to as the "Project" and irzo~3~ss 2 WHEREAS, the Ciry has obtained engineer's estimates of the costs of the construction oC the Project and has advertised for and received bids for a portion of the Project, which bids are and will be subject to the City's determination to construct the Project and subject to the Ciry obtaining funds to pay for the Project; that on the basis of said estimates and bids, the cost of the Project, inetuding estimated incidental expenses, is in the amount of $15,800,000; and WHEREAS, the amount of bonds authorized but not yet issued under the 2005 Ordinance shall now be issued under The provisions of this ordinance; the Council has been advised that the adoption of this ordinance is necessary to add the improvements described on Exhibit B into the Project and to incorporate various changes now required by the hereinafter defined SRF Prograzn; and WHEREAS, the Council finds that it has no Ends on hand to apply on the cost of the Project and that i[ is necessary to authorize [he financing of the Project by the issuance of sewage works revenue bonds, in one or more series, in azr aggregate principal amount not to exceed $ I S,ROQOOQ and, if necessary, bond anticipation notes ("BANS"); and WI IF.REAS, the Council finds that them are now outstanding bonds originally issued to refund outstanding bonds of [he sewage works or to finattee the construction of improvements and additions to [he sewage works and payable out of the revenues therefrom designated as: (i) "Sept-age Wodcs Revenue Bonds, Series 1998," dated December 1, L998 (" 1998 Bonds"), now outstanding in die amount of $ 4,275,000, and maturing annually over a period ending January I, 2019; (ii)"Sewage Works Revenue Bonds, Series 1999." dated Decetnber 30, 1999 ("1999 Bonds"). now outstanding in the amount of $ 2,377,440, and maturing annually over a period ending January I, 2020; (iii) "Sewage Works Revenue Bonds, Series 2003," dated December 17, 2003 (" 2003 bonds"), now outstanding in the amount of $2,755,000, and maturing annually over -2- in_o?;ia~z a period ending January I, 2024; (iv) "Sewage Works Refunding Revenue Bonds of 2004," dated June l5, 2004 ("2004 Bonds"), now outstanding in the amount of $2,085,000, and maturing annually over a period ending January L, 201 l; and (v) "Sewage Works Revenue Bonds of 2005, Series A," dated July 2l, 2005 ("2005 Bonds"), now outstanding in the amount of $6,500,000, and matruiug annually over a period ending Jumary I, 2026; which 1998 Bonds, 1999 Bonds, 2003 Bonds, 2004 Bonds and 2005 Bonds constitute a first charge upon the Net 2evenues (as hereinafter defined) of the sewage works; and WHEREAS, the 1998 Bonds, the 1999 bonds, 2003 Bonds, 2004 Bonds and 2005 Bonds are hereinafter collectively referred to as the "Outstanding Bonds;" and WHEREAS, the ordinances authorizing the Outstanding Bonds permit the issuance of additional bonds ranking on a parity with the Outstanding Bonds provided certain conditions can be met, and the City finds that the finances of the sewage works will enable the City to meet the conditions for the isstanee of additional parity bonds and that, accordingly, the revenue bonds authorized herein shall rank on a parity with the now Outstanding Bonds; and WHEREAS, [he bonds to be issued pursuant to this ordinance are to be issued subject to the provisions of the laws of the State of Indiana, including, without limitation, IC 36A-23, as in ellect on the issue date of the ponds issued hereunder ("AcP'), urd the terms and restrictions of this ordinance; attd WHEREAS. the City desires to authorize the issuance of BANS hereunder, if necessary, payable solely from [he proceeds of die sewage works revenue bonds to finance [hc aforementioned costs of the Project and to authorize the refunding of the 6ANs, if issued; and WHEREAS, the City ltas been advised that it may be cost efficient to obtain municipal bond insurance: and ino„eas? -3- WHEREAS, the City may enter into a Financial Assistance Agreement with the Indiana Finance Authority ("Authority") as part of its wastewater loan program established and existing pursuant to IC 4-411 and 1C 13-18-I3 ("SRF Yrogmm"), pertaining to all or a portion of the P~roj eet and the financing thereof ("Financial Assistance Agreement"); and WHEREAS, the Council now finds that all conditions precedent to the adoption of an ordinance authorizing the issuance of revenue bonds and BANS have been complied with in accordance with the provisions of the Act; NOW THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF JEFFE2SONV[LLE, INDIANA, THAT: Section L Project Authorization. "[he City proceed with [he construction of the Project in accordance with the cost estimates and the plans and specifications, u~eluding any preliminary plans and specifications, heretofore prepared and filed by the consulting engineers employed by the City, which cost estimates and all plans and specifications are by reference made a part of this ordinance as fully as if the same were attached hereto and incorporated herein and two copies of which are now on file or shall be placed on file in [he office of the Clerk- "Ireasmer of the City and are open for public inspection pursuant to 1C 36-1S-4. The cost of construction of the Project shall not exceed the stmt of $15,800,000, plus investment earnings on the bond and BAN proceeds, without further authorization from this Council. The terms "sewage works," "sewage works system," "system," "works," and other like terms whore used in this ordinance shall be construed to mcan the Treatment Works. as detinul in the Financial Assistance Agreement entered into between the City and the Authority. and includes all structures and property of the City's sewer utility, including items defined at IC 36-9-I-8. the Council has determined that all sewer tap fees collected in accordance with IC 36-9-23-29 are to a- b70B9Ri2 be treated and used as Net Revenues of the sewage works. The Projut shall be constructed in accordance with the plans and specifications heretofore mentioned, which glans and specifications ue hereby approved. The Project shall be constructed and the bonds herein authorized shall be issued pursuant to and in aceordanee with the Act. Section 2 Issuance of Bonds and BANS. (a) The City shall issue, if necessary, its BANS for the purpose of procuring interim financing to apply to the cost of the Project. The City shall issue its BANS, in one or more series, in an amount not to exceed Fifteen Million Eight Hundred Thousand Dollars ($L5,800,000) to be designated "Sewage Works Bond Anticipation Notes, Series (to be wmpleted with the appropriate series designation)." The BANS shall be sold at a price not Icss than 99% of their par value, shall be numbered consecutively Etnm I upward, shall be in denominations of One Thousand Dollars ($1,000) or if sold to die Authority as part of the SR}+ Program, One Dollar ($l), as designated in the purchase a~eement for [he RANs, shall be dated as of the date of delivery thereof. and shall bear interest at a rate not to exceed 6% per annum (the exact rate or rates to be determined through negotiation). Each series of BANS will mature no later than five (~) years after their date of delivery. The 6ANs are subject [o renewal or extension a[ an interest rate or rates not to exceed 6% per annum Qhe exact rate or rates to be determined tlrrough ncgotiatiou). The term of the BANS and all renewal BANS may not exceed five years from the date of delivery of the initial 6ANs. The BANS shall he registered in rile name of the purchasers thereof. The BANS shall be issued pursuant to [C 5-I 5-8-6. L if sold to the Lndiana Bond Bauk_ pursuant to tC 4-4-I 1 and IC L3-18-13 if sold to the Authority, or pwsuant to IC S-I-14-5 ifsold to a financial institution or any other purchaser. The principal of and interest on the BANS shall be payable solely from the issuance of revenue bonds pwsuant to and in the moaner prescribed _~_ 120739852 by the Ac[. The revenue bonds will be payable solely out of and constitute a firs[ charge against the Net Revenues (defined as the gross revenues of the sewage works of the City remaining after the payment of the reasonable expenses of operation, repair and maintenance) of the sewage works of the City, on a parity with the Outstanding Bonds. (b) The City shall issue its sewage works revenue bonds, in one or more series, to be designated as "Sewage Works Revenue Bonds of " (to be completed with the year in which the bonds are issued and the appropriate series designation) ("Bonds"), in an aggregate principal amount nol to exceed $15,800,000 for the pwpose of procuring funds to be applied on the cost of the Pxojeet, the payment of costs of issuance, refunding the BANS, if issued, and aLL other costs related to the Project, including a premium foe municipal bond insurance The Bonds shall be sold at a price not less than par value if sold to the Authority as part of its SRF Program or not less than 985% of the paz~ value thcieof is sold to any other purchaser, shalt be issued in the denomination of $I or integral multiples thereof if sold to the Authority as part of its SRF Program, or in denominations of Five Thousand Dollars ($5,000) each or integral multiples thereof if sold to any other purchaser, numbered consecutively finm I upward, dated as of the first day oC the month in which they are issued or sold or as of the date of delivery, as determined by the Cled<-Treasurer with Ute advice of the City's financial advisor, provided that if sold to [he Autlroriry as part of its SRF Program, the Bonds shall be damd the date of delivery. The Bonds shall bcar interest at a rate or rates not exceeding 6% per annum (thc exact rate or rates to be determined by bidding or thiaugh negotiation widt the Authority through ils SRF Pro,ram) payable semiannually on January I and July 1 in each year, commencing on the first .Ianuary I or the first .luly I following delivery of [he Bonds and as designated by the Clerk- Treasurer. with the advice of the City's financial advisor. "Che Bonds shall mature annually on -6- f'_0'3Ohi.? Jamtary 1 of each year over a period ending no later than twenty (20) years after substantial completion of the Project (as determined under the Financial Assistance Agreement for any Bonds sold to the Authority as part of its SRF Program), and in such amounts that will allow the City to meet the coverage and/or amortization requirements of the SRF Program. Such debt service schedule for any Bonds sold to the Authority as part of its SRF Program shall be finalized and set forth in the Financial Assistance Agreement. For any Bonds not sold to the Authority as part of its SRF Program, such Bonds may mature in amounts that produce as level debt service as practicable with $5,000 denominations and may take into account the annual debt service on the Outstanding Bonds and any other series of Bonds issued under this ordinance. Each series of bonds issued hereunder shall rank as a parity for all purposes, including Urc pledge of Net Revenues under this ordinance. Interest on the bonds and the BANS shall be calculated according to a 360~ay calendar year containing twelve 30-day months. All or a portion of the Bonds may be issued as one or more term bonds, upon election of the successful bidder. Such term bonds shall have a stated maturity or maturities iu the years as determined by the successful bidder, but in no event later tban the final serial maturity date of the Bonds as determined in die above paragraph. The term bonds shall be subject to mandatory sinking fond redemption and final payment(s) at maturity at 100% of the principal amount thereof plus accrued interest to die redemption date, on principal payment dates which are hereinafter determined in accordance with dte above paragraph. Section 3. R'<istrar and P~ ~ino 4Kent book-Entry Provisions. The Clerk-Treasurer is hereby authorized to contract with a qualified financial institution to serve as Registrar and Payine Agent for the Bonds ("Registrar" or "Paying Agent"). The Registrar is hereby charged witlt the responsibility of autheu[icating the Bonds. The Clerk-Treasurer is be~eby authorized to 7_ 1307 ~9P>2 eater into such agreements or understandings with the Registrar as will enable the institution to perform the services required of a registrar and paying agent. 'I~he Clerk-Treasurer is further authorized to pay such fees as the Registrar may chazge for the services it provides as Registrar and Paying Agent and such fees may be paid firm the Sewage Works Sinking Fund established [o pay the principal of and interest ou the bonds as fiscal agenty charges. As to the BANS, the Clerk-Treasurer shall serve as Registrar and Paying Agent aztd is hereby charged with the duties of Registrar and Paying Agent. As to the BANS and as to the Bonds, if sold to the Authority as part of its SRF Program or any other purchaser that does not object to such designation, the Clerk-Treasurer may serve as Registrar and Paying Agent and is hereby charged with the duties of a Registrar and Paying Agent. If any Bonds or BANS are sold [o the Authority as part of its SRF Program, the principal of and interest tlrereon shall be paid by wire transfer [o such financial institution if and as directed by the Authority on the due date of such payment or, if such due date is a day when financial institutions are not open for business, on the business day immediately after such due date. So long as the Authority is the owner of the Bonds or BANS, such Bonds and BANS shall be presented for payment as directed by the Authority. If wire transfer payment is not required, the principal of the Bonds shall be payable at the principal corporate trust office of the Paying Agent. All payments of interest on the Bonds shall be paid by check, mailed one business day prior to dre interest payment date to the registered owners tlterwf as the names appear as of the fifteenth dap of the montlt preceding the interest payment date ("Record Date") and at the addresses as they appear on the registration books kept by the Registrar or nt such other address as is provided to the Paying Agent in writing by such -8- I2n89NS2 registered owner If payment of principal or interest is made to a depository, payment shall be made by wire transfer on the payment date in sameday funds. If the payment date occurs on a date when financial institutions are not open for business, the wire transfer shall be made on the next succeeding business day. The Paying Agent shall be instmcted to wire transfer payments by L00 p.rrc (New Yogic City time) so such payments are received at the depository by 230 p.m. (New Yoxk City time). All payments on the Bonds shall be made in any coin or cun~eney of the United States oC America, which on the date of such payment, shall be legal tender for the payment of public and private debts. Each Boud shall be transferable or exchangeable only upon the books of [he Ciry kept for that purpose at the principal corporate tmst office of the Registrar by the registered owner in person. or by its attorney duty authorized in writing. upon srvrender of such Boud together with a written instrumem of nznsfer or exchange satisfactory to the Registrar duly executed by the registered owner, or its attorney duly authorized in writing, and thereupon a new fully registered Bond or Bonds in au authorized aggregate principal amount and of the same maturity, shall be executed and delivered in [he name of the transferee or transferees or the registered owner. as the case may he, in exchange therefor The costs of such transfer or exchurge shall be home by the Ciry except for any tax or governmental charge required to be paid with resput to the transfer or exchange. which taxes or governmental charges are payable by the person requesting such transfer or eschuigc. The Cily, Registrzr and Paying Agee[ Cor lire Bonds may treat and consider the person in whose name such Bonds az'e registered as the absolute owner thereof for all purposes including for the purpose oC receiving payment of, or on account of, the principal thereof and interest due [hereon. -9- vzo,ies;.a The Registrar and Paying Agent may at any time resign as Regishar and Paying Agent upon giving 30 days' notice in writing to the City and by firs[ class mail to each registered owner of [he Bonds then outstanding and such resignation will take effect at the end of such 30 day period or upon the earlier appointment of a successor registrar and paying agent by the City. Any such notice to the City may be served personally or sent by registered mail. The Registrar and Paying Agent may be removed at any lime as Registrar and Paying Agent by the Ciry, in which event the Ciry may appoint a successor registrar and paying agent. The Ci[y shall notify each registered owner of the Bonds then outstanding by first class mail of the removal of the Registrar and Paying Agent Notices to the registered owners of the Bonds shall be deemed to be given when mailed by first class mail to the addresses of such registered owners as they appear on the registration books kept by the Registrar. Upon the appointment of any successor regisnzr and paying agent by the City, the Clerk- Treasurer is authorized and directed to enter into such agreements and understandings with such successor registrar and paying agent as will enable the institution to perform the services required of a regisn~ar and paying agent for the Bonds. The Cled<-treasurer is further authorized [o pay such fees as the successor regislmr and paying agent may charge for the services it provides as registrar and paying agent and such fees may be paid from the Sewage Works Sinking Fund continued in Section l4 hereof. Any predecessor regislmr and paying agent shall deliver all of the Bonds and any cash or investments in its possession with respect thereto, together with fls reeistration books, to the successor registrar and paying agent. Interest on any Bonds sold to [he Authority as part of its SRF Program shall he payable from dte date or dates oC payments made by the Authority as part oCits purchase of the Bonds as set forth in the Financial Assistance Agreement hlleresl on all other Bonds shall be payable l0- t~ovvx a from the interest payment date to which interest has been paid next preceding the authentication date of the Bonds unless the Bonds are authenticated after the Record Date and on or before such interest payment date in which case they shall bear interest Eiom such interest payment date, or unless the Bonds are authenticated on or before [he Record Date preceding the first interest payment date, in which case they shall bear interest from the original date tmtil the principal shall be fully paid. The City has determined that it may be beneficial to the Ciry to have the Bonds held by a central depository system pursuant to an agreement between the City and The Depository Trust Company, New York, New York ("Depository Trust Company") and have transfers of the Bonds effected by book-entry on the books of the central depository system ("Book Entry System"). The Bonds may be initially issued in the form of a separate single authenticated fully registered Bond for the aggregate principal amount of each separate tnatrtriry of the Bonds In such case, upon initial issuance, the ownership of such Bonds shall be registered in the register kept by the Registrar in the name oCCEDE & CO., as nominee of the Depositoq~ Trust Company. With respect to Ure Bonds registered in the register kept by the Registrar in the name of CEDE & CO., as nominee of the Depository Trust Company, the City and dte Paying Agent shall have no responsibility or obligation to ury other holders or owners (including any beneficial owner ('Beneficial Ownet")) of the Bonds with respect to (i) the accuracy of Che records of the Dcpository ~frust Company, Ch:DE & CO., ox azty Beneficial Owner with respect to ownciship questions, (ii) the ddiveq~ to any bondholder (including any Beneficial Owner) or anv other person, other than the Depository ~f~ust Company, of any notice with respect ro [he Bonds including any notice of redemption, or (iii) the payntettt [o any bondholder (including anv Beneficial Om~ner) or anp other person. other tlran the Depository Trust Company, of any amount v2o7avss.z with respect to the principal of, or premium, if any, or interest on the Bonds except as otherwise provided herein. No person other than the Depository Trust Company shall receive an autltenticated bond evidencing an obligation of the Ciry to make payments of the principal of and premium, if any, and interest ott the Bonds pursuant to this ordinance. The City and the 2egistrar acid Paying Agent may treat as and deem the Depository Trust Company or CEDE & CO. to be the absolute bondholder of each of the Bonds for the purpose of (i) payment of the principal of and premium, if any, and interest on suds Bonds, (ii) giving notices of redemption and other notices permitted [o be given to bondholders with respect to such Bonds; (iii) registering transfers with respect to such Bonds; (iv) obtaining any consent or other action required or permitted to be taken of or by bondholders, (v) voting; and (vi) for all other purposes whatsoever. The Paying Agent shall pay all principal of and prentium, if any. and interest on the Bonds only to or upon the order of die Depository Trust Company, and all such payments shall be valid and effective fully to satisfy and discharge the City's and the Paying A~enPs obligations with respect to principal of and premium, if any, and interest on [he Bonds to the extent of [tte sum or sums so paid. Upon deliveq~ by the Depository Trost Company to the Ciry of written notice to the effect tltat the Deposirory Trust Company has determined to substitute a new nominee in place of CEDE & CO., and subject to the provisions herein with respect to consents, the words "CEDE & CO." in this ordinance shalt refer to such new nominee of the Depository Tnist Company. Nohvithstanding any other provision hereof to the contrary, so lone as airy Bond is registered in the name oC CEDE & CO., as nominee of the Depository l7ust Company, all payments with respect to the prrncipaL oti and premium, if any.. and interest on such Bonds and all notices with IR11~398i2 l~- respect to such Bonds shall be made and given, respectively, to the Depository Trust Computy as provided in a representation letter from the Ciry to the Depository Trust Company. Upon receipt by the City of written notice from the Depository Trust Company to the effect that the Depository Trust Company is unable or unwilling to disehacge its responsibilities and no substitute depository willing to undertake the functions of the llepository "Lies[ Company hereunder can be found which is willing and able to undertake such functions upon reasonable and customary terms, lien the Bonds shall no longer he restricted to being registered in [he register of the City kept by the Registrar ur the name of CEDE & CO., as nominee of the Depository "Crust Company, but may be registered in whatever name or names the bondholders transferring or exchanging the Bonds shall designate, in accordance with the provisions of this ordinance. Lf the City determines that it is in the best interest of the bondholders that they be able to obtain certificates for [he fully registered Bonds, the City may notify Ute Depository Trrst Company and the Registrar, whereupon die Depository Trust Company will notify [he Beneficial Owners of the availability through the Depository Crust Company of certificates for the Bonds. Io such event. the RedsU-ar shall prepare, authenticate, transfer and exchange certificates for the Bonds as requested by the Depository Trust Company and any Benetcial Owners in appropriate amounts, and whenever the Depository Trust Company requests the City and the Registrar to do so, the Registrar and the Ciry will coopcmtc with the Depository Trust Company by taking appropriate action a[ier reasonable notice (i) [o make available one or more separate certificates evidencing the hilly registered Bonds of airy Beneficial Owner's Depository Trust Company account or (ii) to arrange for another securities depository to maintain custody of certificates for and evidencing the Bonds. li- irzo~3vx>z If the Bonds shall uo longer be restricted to being registered in the name of a Depository Trust Company, the Registrar shall cause the Bonds to be printed in blank in such number as the Registrar shall determine to be necessary or customary; provided, however, that the Registrar shalt not be required to have such Bonds printed until it shall have received from the City indemniticationtor all costs and expenses associated with such printing. ht connection with any notice or other communication eo be provided to bondholders by the City or the Registrar with respect to any consent or other action to be taken by bondholders, tite City or the Registrar, as the case may be, shall establish a record date for such consent or other action and give the Depository Trust Company notice of such record date not less than fifteen (l5) calendar clays in advance of such record date to [he extent possible. So long as the Bonds are registered in the name of the Depository Trust Company or CEDE & CO. or any substitute nominee, the City and the Registrar and Paying Agent shall be entitled to request and [o rely upon a certificate or other written representation from the Beneficial Owners of flee [fonds or from the Depository Trust Company on behalf of such Benetcal Owners stating the amount of their respective beneficial ownership interests in the Bonds and setting forth the consent, advice, direc[ioq demand or vote of the Beneficial Owners as of a record date selected by the Registrar and the Depository Trust Company, to the same extent ~s if such cousenL advice, direction, demand or vote were made by the bondholders for pwposes of this ordinance and dte City and the Registrar and Paying Agent shall for such pwposes treat the [teneficial Owners as the bondholders. Along with any such certificate or represenation. the Registrar may request the Depositoq~ Trust Company to deliver. or cause to be delivered. to the Registrar a list of all Beneficial Owners of the bonds, together with the 13_ vznvvss dollar amount of each Beueficial Owner's interest in the Bonds urd the current addresses of such Beneficial Owners. Section 4. Redemption of BANS and Bonds. (a) The BANS are prepayable by the City, in whole or in part, at auy time upon 7 days' notice to the owner of the BANS without any premium. For any series of Bonds not sold to the Authority as part of its SRF Program, such Bonds are redeemable at the option of the City, but no sooner than eight (8) years after their date of delivery, or any date thereafter, on thirty (30) days' notice, in whole or in part, ur the order of maturity as determined by the City and by lot within a maturity, at face value, together with a premium no greater than 2%, plus in each case accrued iuterest to the date fixed for redemption. 1'Ire exact redemption features shall be determined by the Clerk-Treaswer with the advice of the Cily's financial advisor and shall be set out in the notice of sale described in Section 8 herein. For any series of ftonds sold to the Authority as part of its SRF Program. such Bonds are redeemable at the option of the City, but no sooner than ten Q 0) years after dteir date of delivery, or any date thereafter', on sixty (60) days' notice, in whole or in part, in inverse order of maturity, and by lot within a maturity, at face value together with a premimn ^o greater than 2%, plus accrued interest to the date fixed for redemption. 'hhe exact redemption dates and premiums shall be established by the Clerl<-Treasurey with the advice of the City's financial advisor, prior to the sale of the Bonds. If any Bond is issued as a term bond, the Paying Agent shall credit against the mandatory sinking Cund requirement for the Bonds maturing as tens bonds, and corresponding mandatory redemption obligation, in the order de[e~mined by the City, any Bonds maturing as term bonds which have previously been redeemed (o[he~tivise Than as a result of a previous mandatop~ IS- ia_onea;? redemption requirement) or delivered to the legistrar for cancellation or purchased for cancellation by the Paying Agent and not theretofore applied as a credit against any redemption obligation. Each Bond maturing as a Berm bond so delivered or canceled shall be credited by the Paying Agent at 100% of the principal amount thereof against the mandatory sinkiug fund obligation on such mandatory sinking fund date, and any excess of such amount shall be credited on future redemption obligations, and the principal amount of the Bottds to be redeemed by operation of the mandatory sinking fund requirement shall be accordingly reduced; provided, however, the Paying Agent shall credit only such bonds maturing as term bonds to the extent received on or before forty-five (45) days preceding the applicah(e mandatory redemption date as stated above. Each authorized denomination shall be considered a separate bond for ptuposes of optional and mandatory redemption. if Less than an entire maturity is called for redemption, the Bonds m be tatted shall be selected by bt by the Registrar. [f some Bonds are to be redeemed by optional redemption and mandatory sinking fund redemption on [he same date. the Regisnzr shall select by lot the Bonds for optional redemption before selecting the Bonds by bt for the mandatory sinking Cund redemption. ht either case, notice of redemption shall be given not less than sixty (60) days, if [he Bonds are sold to the Audtority as part of its SRP' Program, and thirty (30) days, if the Bonds arc sold to another purchaser, prior to the date fixed for redemption unless such redemption notice is waived by the owner of the Bond or Bonds redeemed. Such notice shall he mailed to the address of the registered owner as shown on the registration record of the Cit} as of the date which is sisry-true (65) days if the Bonds are sold to the Authority as part of its SRF Program, and fotty- five (45) days if the Bonds are sold to another purchaser, prior to such redemption date. The -16- I/70779R5 2 notice shall specify the date and place of redemption and sufficient identification of [he Bonds caller] for redemption. "I~he place of redemption may be determined by the City. Interest on the Bonds so ealfed for redemption shall cease on the redemption date fixed in such notice if sufficient funds are available at the place of redemption to pay the redemption price on the date so named. Coincidentally with the payment of the redemption price, the Bonds so called for redemption shall be surrendered for cancellation. Section 5. Execution and Nceofiabifity. Each of the BANS and Bonds shall be executed in the name of the City by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of its Clerk-Treasurer, and the seal of the City shall be affixed, imprinted or impresser] to or on each of the BANS and Bouds manually, by facsimile or any other means; and these officials, by the execution of a Signature and No Litigation Certificate, shall adopt as and for [heir own proper signatures the facsimile signatures appearing on the Bonds or BANS. In case any officer whose signature or facsimile siEnatw~e appears on the Bonds or BANS shall cease to be such officer before the delivery of the Bonds or 6ANs. the signature of such officer shall nevertheless be valid and sufficient for all purposes the same as' if such o18cer had remained in office until such delivery. l~he 6ANs and Bouds shall have all of the qualities and incidents of negotiable instruments under the laws of the State of Indiana, subjcet to the provisions for registration herein. The Bottds shall also be authenticated by the manual signature of the Registrar, and no Bond shall be valid or become obligatory Ibr any purpose until the certificate of authentication thereon has been so executed. 17- iamsess.z Section 6. Eonn of Bonds. The form and tenor of the Bonds shall be substantially as follows, all blanks to be filled in properly prior to delivery: lUnless [his ceitifca[e is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to [he City of Jeffersonville, Indiana, or its agent for registration of transfer, exchange, or payment, and any ceitifcate 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 [o such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUG OR OTHF,RWISG 6Y OR TO ANY PERSON IS WRONGFUL, inasmuch as the registered owner hereof, Cede & Co., has an interest herein.) NO. UNffED STATES OF AMERICA STATE: OC INDIANA COUN"LY OL' CLARK CITY OF JEFFERSONVILLE SEWAGE WORKS RF,VGNUE BOND OF Interest Rale [~4aturi[y Dated Original Date Authentication Date [CUSIP~ REGISTERED OWNCR: PRINCIPAL SUM: The City of Jeffersonville, in Clarl< County, State of Indiana ("City"), for value received, hereby promises to pay to the Regis[e~rd Owner named above or registered assigns, solely out of the special revenue fund hereina[ier refenrd [q the Principal Sum set foth above[, or so [Huth thereof as may be advanced from time to time and be outstanding as evidenced by the records of the registered ow-Her making payment for this bond, or its assigns.] on the Maturity Date set forth above 02 January l in the years and in the amounts as set forth on Exhibit A attached here[o~ (unless this bond be subject [o and shall have been duly called for redemption and payment as provided for herein). and m pay interest hereon wtlil the Principal Sum shall be fully paid at the rate per annum specified above tom [the dates of payment made on [his bonds OR ~dre interest payment dale to which interest has been paid next preceding the Authentication Dafe of this bond unless this bond is authenticated after the fifteenth day of the month preceding an interest payment date end on or before such interest payment in which case it shalt bear interest tlom such interest payment date, or unless this bond is authenticated on or before I5, in which case it shall bear interest fi'om the Original Uate,~ until [he principal is paid. m~hich interest is payable semiannually on the ftis[ days of January and July in each year, 18- beginning on , 20 Interest shall be calculated accord'urg to a 360-day calendar year containing twelve 30-day months. [The principal of this bond is payable at the principal office of ("Registrar" or "Paying AgenP'), in the of , hrdiana.~ All payments of [principal of and] interest on this bond shall be paid by check mailed one business day prior to the interest payment dated OR wire transfer for deposit to a financial instianion as directed by the Lndiana Eiuance Authority ("Authority") on the due date or, if such due date is a day when financial institutions are not open for business, on the business day immediately afrer such due dated to flee registered owner hereof, as of the fifteenth day of the month preceding such payment, a[ the address as it appears on the registration books kept by ~ ("Registrar" or "Paying AgenP') in the _ of _ Indianan OR [the Registrars or at such other address as is provided to the Paying Agent in writing by the registered owner [If payment of principal or interest is made to a depository, payment shall be made by wire transfer on the payment date in same-day funds. if the payment date occurs on a date when financial institutions are not open for business, the wire transfer shall be made on the next succeeding business day. The Paying Agent shall wire transfer payments by 1:00 p. m. (New York City time) so such payments are received at the depository by 230 p.m. (New York City time). All payments on the Bond shaft be made in any coin or currency of the United States of America, which on the dates of such payment, shall be IegaL tender for the payment of public and private debts. THE CITY SHALL NOT BG OBLIGATED TO PAY THIS BOND 02 THE INTEREST HEREON EXCEPT FROM THE HEREINAFTER UF.SCRIBED SPECIAL FUND, AND NEITHER THIS BOND NOR THE ISSUE OE WHICH 1T 1S A PART SHALL IN ANY RESPECT CONSTITU I'E A CORPORATE INDEBTEDNESS OE THE CCPY WITHIN 111E PROVLSIONS AND LIMITATIONS OF THE. CONSTITUTION OF THE STATE OI' INDIANA. This bond is the only] one of an audtorized issue of bonds of the City, to be issued in series, of like date, tenor and effect, ~excep[ as to rates of interest, series designations and dates of maturity; aggregating Dollars ($ ~ for this series; numbered consecutively from I up; issued for [he purpose of providing funds to be applied on the cost of additions, extensions and improvements to the City's sewage works ("ProjecP')~. to refund interim notes issued in anticipation of the bonds and to pay issuance expenses~_ including a premium for municipal bond insmanceJ. This bond is issued pursuant to an Ordinance adopted by the Common Council of the Cily on the day of , 2008. entitled "An Ordinance of the City of Jeffersonville authorizing the issuance of sewage wo~$s revenue bonds for the purpose ofprovidirtg funds to pay the cost of certain additions, extensions and improvements to dre municipal sewage works of said City, providing for the safeguarding of the interests of the owners of said bonds, other matters connected therewith, including the is'suancc of notes in anticipation of bonds, and repealing ordinances inconsistent hercwitlr" ("Ordinance"), and i^ accordance with the provisions of hrdiana law, including without (imitation Indiana Code 36-9-23 as in effect on the date of defiveq~ of the bonds of this issue ("Act"), the proceeds of which bonds are to be applied to the costs of the Project, [the payment of notes issued in anticipation of [he bonds, and expenses incurred in connection thereevith~_ including a premium for municipal bond insmance~. Iy_ b?0739N~ ~ Reference is hereby made to the Financial Assistance Agreement ("Financial Assistance Agreement') between the City and the Authority concerning certain terms and covenants pertaining [o the sewage works project and the purchase of [his Bond as part of the wastewater loaq program established and existing pursuant to [C 4-4-1 L and IC 13-I8-13. Pursuant to the provisions of the Act and the Ordinance, the principal of and interest on this bond and all other bonds of said issue[, including the Sewage Works Revenue Bonds of 20. ,Series ("Series bonds")] and any bonds hereafrer issued on a parity tlrerewith are payable solely from the Sewage Works Sinking Fund continued by the Ordinance ("Sinking Fund") to be provided from the Net Revenues (defined as the gross revenues of the sewage works of the City remaining after the payment of the reasonable expenses of operation, repair and maintenance) of the sewage works of the City. The bonds of this issue rank on a parity with the Outstanding Bonds, as defined in the Ordinance hand the Series Bouds~. The City irtevocabLy pledges the entire Net Revenues of the sewage works to the prompt payment of the principal of and interest on the bonds authorized by the Ordinance, of which this is one, and any bonds ranking on a parity therewith, including the Outstanding Bonds [and the Series Bonds, to the extent necessary for that purpose, and covenants that it will cause to be fixed, maintained and collected such rates and charges for services rendered by the utility as are sufficient in each year for die payment of the proper and reasonable expenses of ~Opera[ion and Maintenance (as defined in the Financial Assistance Agreement) operation, repair and maintenance) of fire sewage works and for the payment of the sums required to be paid into the Sinking Fund under the provisions of the Act and the Ordinance. if the City or die proper officers thereof shall fail or refuse to so fix, maintain and col legit such rates or charges, or if there be a default in [he payment of the interest on or principal of this bond, the owner of [his bond shall have all of [he righLS and remedies provided for in the Act, including [he right to have a receiver appointed to administer the works and to ehmge and collect rotes sufficient to provide for the payment of tltis bond and the interest hereon. The City further covenants that it will sei aside and pay into its Sinking Fund monthly, as available, or more often if necessary, a sufficient amount of [he Net Revenues of dte works for payment of (a) the interest on all bonds which by their terms are payable fi-om the revenues of the sewage works; as such interest shall fall due, (b) [he necessary fiscal agency charges for paying bonds and interest, (c) the principal of all bonds which by dreir [eons are payable from the revenues of the sewage works, as such principal shall fall due, and (d) an additional amount as a margin of safety to create and) maintain the debt service reserve required by the Ordinance. Such required payments shall constitute a first charge upon all the Net Revenues of the sewage works, oft a parity with [he Outstanding Bonds [mtd [he Series __ Bonds. The bonds of this issue maturing on and after January 1, arc redeemable at the option of the City on I, 20 or any date tliereafter, onsixty (60)~ Thirty (30)~ days' notice, in whole or in par[, [in inverse order of maturity OR (in the order of maturity as determined by the City and by lot within a maturity, at Lace value, [ogedrer with the following premiums: if redeemed on (,?00 or [hereaher on or before _.._, 20: -20- 120]3'I8~ Z if redeemed on _ 1, 200_ or thereafter on or before , 20 ; 0`% if redeemed on L, 20 or thereafrer prior to maturity; plus accrued interest to the date fixed for redemption. [The bonds maturing on January 7, are subject to mandatory sinking fund redemption prior to maturity, at a redemption price equal to the principal amount thereof plus accrued interest on January f, in the years and in the amounts set forth below: "Germ bond Year Amount * Final Maturity] Each Five Thousand Dollazs ($5,000)] One Dollar ($I)] principal amount shall be considered a separate bond for purposes of optional [and mandatory redemption [f less than an entire maturity is called for redemption, the bonds to be redeemed shall be selected by lot by the 2egistrar. [[f some bonds arc to be redcemed by optional redemption and mandatory sinking fund redemption on the same date, the 2egistrar shall select by lot the bonds for optional redemption before selecting the bonds by lot for the mandatory sinking ftmd redemption. Notice of such redemption shall be mailed to the address of the registered owner as shown on the registration records of the City, as of the date which is sixty-five (65)~ [forty-five (45)~ days' prior to such redemption date, no[ less than [sixty (60)J thirty (30)~ days prior to the date tired for redemption unless the notice is waived by the registered owner of this bond. The notice shall specify the date and place of redemption and sufficient identification of the bonds called for redemption. The place of redemption may be determined by [he City. Interest on the bonds so called for redemption shall cease on the redemption date fixed in such notice if sufficient funds are available at the place of redemption to pay the redemption price on the date so named. [f tltis bond shall not be presented for payment or redcntp[ion on dte date fixed therefor_ the City may deposit in [rust with its depository bank an amount sufficient to pay such band or the redemption price, as the case may be, and thereafter the registered owner shall look only [o the fiords so deposited in mist with said bank for payment and the City shall hacc no further obligation or liability in respect thereto. This bond is transferable or exchanecable only upon the books of the Ciry kept for that purpose at the [principal corporate trusQ office of the 2egistrar by the registered owner hereof in person, or by his attorney duly audiorizsd in writing, upon surrender of tlris bond together with a written instrument of transfer or exchange satisfaetop~ to the Registrar duly executed br the registered owner, or his attorney duly authorized in writing, and thereupon a new fully registered bond or bonds in an authorized aggregate principal amount and of the same maturi h. shall be -21 uzon is; z executed and delivered in the name of the transferee or transferees or to dre registered owner, as the case may be, in exchange therefor. This bond may be transferred without cost to the mgistered owner except for any tax or govermnentat charge required to be paid with respect to the transfer. The City, the Registmr, the Paying Agent and any other registrar or paying agent for this bond may treat and consider the person in whose name this bond is registered as the absolute owner hereof for aLl proposes including for the purpose of receiving payment of, or on aceount of, the principal hereof and interest due hereon: The bonds shall be initially issued in a Book Entry System (as defined in the Ordinance). The provisions of this bond and of the Ordinance are subject in all respects to the provisions of the Letter of Representations between the City and 'Che Depository "Crust Company, or any substitute agreement, effecting such Book Entry System. [The Ciry has designated this bond as a "qualified tax-exempt obligation" to qualify this bond for the $IO,OOQ000 exception from the provisions of Section 265(6) of the Internal Revenue Code of 1986 relating to the disallowance of 100% of interest expense allocable to qualified tax-exempt obligations acquired by financial itts[i[utions.) This bond is subject to defeasanee prior to redemption or payment as provided in the Ordinance referred to herein. THE OWNER OF THIS BOND, BY THE ACCEPTANCE HEREOF, HEREBY AGREES TO ALL THE TERMS AND PROVISIONS CONTAINED IN THE ORDINANCE. The Ordunance may be amended without the consent of the owners of the bonds as provided in the Ordinance. The bonds maturing in any one year are issuable only in fully registered form in the denomination of [$5,000 ~$ I ~ or any integral multiple thereof. It is hereby certified and recited that all acts, conditions and things required to be done precedent to and in [he execution, issuance and delivery of this bond have been done and performed in regular and due form as provided by law. This bond shall not be valid or become obligatory for any purpose until rile certificate of authentication hereon shall have been executed by an authorized representative of the Registrar. IN WITNESS WHEREOF. the City of Jeffersom~ille, in Clarl< County, Indiana, has caused tliis bond to be executed in its corporate Warne by the manual or Cacsimile signature of its Mayor. its corporate seal to be hercunlo affixed, imprinted or impressed by any means and attested manually or by facsimile by its Clerk-Treasw-er. CITY OF JEPFERSONVILLE NT)IANA ~ SEAL] [3v Maya _22_ raarwxs2 Attest Clerk-Treasurer 23 - vzo~~ess REGIS'TRAR'S CERTIFICATE OF AUTHENTICATION This bond is one of the bonds described in the within-mentioned Ordinance. as Registru' By Authorized Representative ASSIGNMENT FOR VAL[7E RECEIVED the undersigned hereby sells, assigns and transfers unto this bond and all rights thereunder, and hereby irrevocably constitutes and appoints ,attorney, to transfer the within bond in the books Kept For [he registration thereof with full power of substitution in the premises. Dated: NOTICE: Signature(s) must be guaranteed by an eligible guarantor institution participating in a Securities Transfer Association recognized signature guarantee program. NOTICE: The signature to this assignment must correspond with the name as it appeals on [he face of the within bond in every particular, without alteration or entargentent or any change whatsoever. 8XHIBIT A ~To be completed on a separate page Section 7. Authorization for Preparation and Sale of the BANS and the bonds Municipal Bond Insurance. (a) The Clerk-Treasurer is hereby attthoiized and directed to have the BANS and the Bonds prepared, and the Mayor and Clerk-Treasurer arc hereby authorized and directed to execute and attest the BANS and the Bonds in the form and manner provided herein. "The Clerk-Treasurer is hereby authorized and directed to deliver the BANS and the Bonds to the respective purchasers thereof At the time of delivery of the BANS and the Bonds. the Clerk- Treasurer shall collect [he full amount which the respective purchasers have agreed to pay thercfoit which amount shall not he no[ less than 99% of the lace value of the BANS. not less 24 - Ii207i9RS? than the par value of the Bonds if sold to the Authority as a part of its SRF Program, acid not less than 98.5% of the par value of the Bonds if sold to any other purchaser, as the case may be, plus accrued interest to the date of delivery, if any. Payment for the BANS and any Bonds sold to the Authority as a part of its SRF Program may be made in installments. TYhe Bonds, as and to the extent paid for and delivered to ehe purchaser, shall be the binding special revenue obligations oC the City payable out of the Net Revenues of the sewage works, on a parity with the Outstanding Bonds. 'The proper officers of the City are hercby directed to sell the Bonds, to draw all proper and necessary warrants, and to do whatever acts and things which may be necessary to carry out the provisions of this ordinance. Distribution of an Official Statement (preliminary and final) prepared by H.J. Umbaugh & Associates, Certified public Accountants, LLP, on behalf of the City, is hereby approved and the Maya- or the Clerk-Treasurer are authorized and directed to execute the Official Statement on behalf of the City in a form consistent will ttis ordinance. The Mayor or the Clerk-Treasurer are hereby authorized m designate the preliminary Official Statement as "nearly final" for purposes of Rule 15c2-12 pramulgated by the Securities and Exchange Commission ("[lute'"). In the event the 6naneial advisor to the City certifies to the City that it would he economically advantageous for tlhe City to acquire a municipal bond insurance policy for the Bonds, the Ciry hercby authorizes and directs tlhe Mayor and Clerk-Treasurer [o obtain such an insurance policy. The acquisition of a municipal bond insurance policy is hembv deemed economically advantageous in the went the difference between the present value cost of (a) the total debt service on the Bonds if issued without municipal bond inswrance and (b) tlhe total debt service on [he Bonds if issued with municipal bond insurance, is greater than the cost of the premium on the municipal bond insurance policy. If such an insurance policy is purdtased_ the _Zj_ I/20739R~ 2 guaranteed by such financial surety bond. If the Bonds are awarded to a bidder utilizing a financial surety bond, then that purchaser is required to submit to the City a certified or cashier's check (or wire transfer such amount as instructed by the City) not later than 3:30 p.m. (Jeffersonville time) on the next business day following the award. In the event the successful bidder shall fail or refiise to accept delivery of the Bonds and pay for the same as soon as the Bonds are ready for delivery, or at the tune fixed in the notice of sale, then said check and the proceeds thereof shall be the prroperty of the City and shall be considered as its Liquidated damages on account of such default. Bidders for the Bonds will be required to name the rate or rates of interest which the Bonds are to bear, not exceeding fhe maximum late hereinbefore fixed, and such interest rate or rates shall be in multiples of one-eighth Q/8) or one-twentietli (I/20) of one percent (l%). The rate bid on a maturity shall be equal to or greater than the rate bid on the immediatety preceding maturity. No conditional bid or bid for less than 98.5% of the face amount of the Bonds will he considered. The opinion of Ice Miller LLP, bond counsel of Indianapolis, Indiana, approving the legality of [he Bonds, will be furnished to the purchaser at the expense of the City. The Bouds shall be awarded by the C~crk-Treasurer to the best bidder who has submitted his bid in accordance with the teens of this ordinance, IC S-I-I 1 and the notice of sale. The best bidder will be the one who offers the lowest net interest cost to Ute City. to be determined by computing the total interestan all of the Bonds to their maturities and adding thereto the discount hid, if any, end deducting the premium bid, if any. The right to rejeel any and all bids shall be reserved. If an acceptable bid is not received on the date of sale, the sale may be continued from day to day thereafter without further advertisement for a period of thirty (30) days, during which -27- inor~exs time no bid which provides a higher net interest cost fo the City than the best bid received at the time of the advertised sale will be considered. As an alternative to public sale, the Clerk-Treasurer may negotiate the sale of any series of [he Bonds to [he Authority as a part of its SRF Program.. The Mayor and the Clerk-Treasurer are hereby authorized to: (i) submit an application to the Autftoriry as a part of its SRF Program, (ii) execute a Financial Assistance Agreement with the Authority with terms conforming to this ordinance and (iii) sell such Bonds upon such terms as are acceptable to the Mayor and the Clerk-Treasurer consistent with the terms of this ordinance. The substantially final form of Financia( Assistance Agreement attached hereto and incorporated herein by reference is hereby approved by the Common Comrcil, and the Mayor and Clerk-Treasurer are hereby authorized to exuute and deliver the same, and to approve any changes in foam or substance to the Financial Assistance Agreement. which are consistent with [he terms of this ordiuance, such changes to be conclusively evidenced by its execution. Section 9. Use of Proceeds and Costs of Issuance. Any accrued interest and any premium received at the time of the delivery of the Bonds shall be deposited in the Sewage Works Sinking Fund hereinafter defined. The remaining proceeds from the sale of the Bonds, to fife extent not used to refund BANS, and BAN proceeds shall be deposited in a bank or banks which are legally designated depositories for [he funds of the City. in a special account or accomus to be designated as "City of Jeffersonville, Sewage Works Construction AccounP' ("Construction AecounP'). All funds deposited to the credit of the Sewage Woii<s Sinking Fund or the Construction Account shall be deposited, held, secured or invested in accordance with the taws oC the State of Indiana relating to the depositing, holding; securing or investing of public funds, including particularly IC 5-13, IC 4-4-I1 and 1C Li-18-13, as amended and supplememed. 28 - vx~~sexs.c The funds in the Construction Account shall be expended only for the purpose of paying the cos[ of the Project, refunding the BANS, if issued, or as otherwise requitrd by the Ac[ or for [he expenses of issuance of the bonds. The cost of obtaining the services of Ice Miller LLP. H.J. Umbaugh & Associates; Certified Pubhe Accountants, LLP and counsel for the City, shall be considered as a parr of [rte cost of the Project on account of which the BANS and Bonds are issued. Any balance or balances remaining unexpended in such special accotmt or accounts after completion of the Project, which are not required to meet unpaid obligations incurred in connection with such Project, shall either (I) be paid into the Sinking Fund and used solely for the purposes of said Sinking Fund or (3) be used for the same purpose or type of project for which the Bonds were originally issued, all in accordance with LCS-LI3, as amended and supplemented. With respect to any Bonds sold to the Authority as part of its SRP Program, to the extent [ha[ (a) [he total principal amount of the Bonds is not paid by [he purchaser or drawn down by the City or (b) proceeds remain in the Conshtiction Account and are not applied [o the Project (or any modifications or additions thereto approved by the Department and [he Authority). the City shall reduce the principal amount of flte Bond maturities to effect such reduction in a manner that will still achieve the annual debt service as described in Section 2 subject to and upon the tetras set forth in the Financial Assistance Agreement. Section 10. Financial Keeords and Accounts' Continuing Disclosure. the City shall keep proper records and books of account, separate from all of its other records and accounts. in which complete and correct entries shall be made showingall revenues received on account of the operation of [he sewage works and all disbursements made therefrom and all transactions ~9 _ II~(I'i'/3i2 relating to the utility. Copies of aLl such statements and reports shall be kept on file iu flte office of the Clerk-Treasurer. if the Bonds or BANS are sold to the Authotiry as pact of its SRF Program, the City shalt estabtislt and maintain the books and other financial records of the Project (including. [he establishment of a separate account or subaccount fa- the Project) and the sewage works in accordance with (i) generally accepted governmeutaL accounting standards for utilities, on an acerual basis, as promulgated by the Government Accounting Standards Board and (ii) the rules, regulations and guidance of the Spate Board of Accounts. If any series of bonds are subject to the Rule, a Contimung Disclosure Ondertaking A~-eemem ("AgreemenP') for the Bonds is hereby authorized and app~nved by die Common Council, and the Mayor and Clerk-Treasurer are hereby authorized and directed to complete, execute and attest the same on behalf of the City. Notwithstanding any other provisions of this ordinance. failure of the City to comply with the Agreement shall no[ be considered an event oC default under the Bonds or this ordinance. Section I I. Pledge of Nel Revenues. The interest on and the principal of the bonds issued pursuant to the provisions of this ordinance, and any bonds hereafter issued on a parity therewith, shall constitute a first dtarge on all the Net Revenues, on a parity with the Outstanding Bonds, and such Net Revenues are hereby in-evocably pledged to the payment of the interest on and principal of such Bonds, to the extent necessary for that purpose. Section L. Revenue Fund. All revenues derived from [hc operation of the sewage works and S~om the collection of sewer and storm water rates and charges shall be deposited in [he Revenue Fund ('92evcnue Puud") hereby continued. Of the revenues in the Kevenue Ftmd, the piroper and reasonable expenses oC operation, repair and maintenance of the wotlcs shall be _3p_ rzo~;vs; paid, the principal and interest of all bonds and fiscal agency charges of regishzrs or paying agents shall be paid, dte reserve shall be Funded, and [he costs of replacements, extensions, additions and improvements shall be paid. So bng as the 1998 Bonds and 1999 bonds are outs[andurg, no moneys derived from the revenues of the sewage works shall be transferred to any other fund of the City or be used for any purposes not connected with the sewage works. Section 13. Operation and Maintenance Fund. The Operation and Maintenance Fund ("0&M Fund") is hereby continued. Ou the last day of each calendar month, revenues of the sewage works shall be transferred from Cite Revenue Fuud to the O&M Fund. The balance maintained in dtis Rmd shall be sufficient to pay the expenses of operation, repair and maintenance for the then next succeeding hvo (2) calendar montlts. The moneys credited to this Fund shall be used fox the payment of the reasonable and proper operation, repair and maintenance expenses of the sewage works ou a day-to-day basis, but none of the moneys in the Fund shall be used for depreciation, replacements, improvements, extensions or additions. Any monies in this Fund may be transferred to the Sewage Works Sirilcing Fund if necessary to prevent a default in [he payment of principal of or interest on the outstanding bonds of the sewage works. Section 14. Aewaoe Wod<s Sinl<ina Fund (a) The Sewage Works Sinking Fund ("Sinking Fund") is hereby continued for the payment of the principal of and interest on revenue bonds which by their terms are payable from the Net Revenues of the sewage works and the payment of any tscal agency charges in connection with the payment of bonds. there shall be set aside and deposited in the Sinkine Fund. as available, and as hereinafter provided, a sufficient amount of the Ne[ 2evenucs of said sewage works to meet the requirements of the Rond and interest Account and the Debt Service Resewe Account hereby continued in the Si~il<ing Fund. _~l_ rxiross.z Suchpayments shall continue until the balances in the Bond and Interest Account and the Debt Service Reserve Account egrtal the principal of and interest on all of the then outstanding bonds of die sewage works [o dreir final maturity. (b) 6ottd and Interest ACCOrutt. The Bond and lnteres[ Account is hereby continued. There shall be credited ou the last day of each calendar month from the Revenue Fund to the Bond and Interest Account of the Sinking Fund an amount of the Net Revenues equal to (i) at leas[ one-sixth Q/6) of the interest of all then outstanding bonds payable on [he next succeeding interest payment date azid (ii) at least one-twelfth Q/L3) of the principal on all then outstanding bonds payable on [he then next succeeding principal payment date, until the amount of interest and principal payable on [he then next succeeding respective interest and principal payment dates shall have becn so credited. There shall similarly be credited to the account any amounts necessary to pay the bank fiscal agency chazges for paying principal and interest on the bonds as dre same become payable. Ttte City shall, fiom the sums deposited in [he Sinking Fund and aedited to die Bond and Interest Accotmt, remit promptly to the registered owner or to the bank fiscal agency sufficient moneys to pay the interest and principal on the due dates thereof together with the amount of bank fiscal agency charges. (e) Reserve Account There is hereby continued, within die Sinking Fund. die Debt Service Reseve Account ("Reserve Account"). On the date of delivery of [he Bonds, funds on hand of the sewage works, bond proceeds or a combination thereof may be deposited into the Resen~e Account The balance to be maintained in the Reserve Account shall eyual but not exceed the Icast of (i) maximum annual deb[ service on [he Bonds, the Outstanding Bonds and any bonds issued in die future by the City which are payable from Net Revenues of the sewage wod<s and which rank on a parity with the Bonds ("Parity Bonds"). (ii) 12~% of average annual -32- inar3yss debt service on the Bonds, the Outstanding Bonds or any Parity Bonds, or (iii) LO% of the proceeds of the Bonds, the Outstanding Bonds or any Parity Bonds ("Reserve Requirement"); provided tltat if any Bonds are sold to the Authority as part of its SRF Program, the Reserve Requirement shall equal the maximum annual debt service on the Bonds, the Outstanding Bonds and any Parity Bonds. if the initial deposit inm the Reserve Account does not cause the balance therein to equal the Reservc Requirement or if no dcposit is made, an amount of Net Revenues shall be credited to the Reserve Account on the last day of each calendar month until the balance therein equals the Keserve Requirement The monthly deposits shall be equal in amount and sufficient to aceumulate the Reserve Requirement within five years of the date of delivery of the Bonds. Once the 199R Bonds and 1999 bonds have been paid, the City may fund all or part of the Reserve Account with a debt service reserve sw-ety bond. The surety bond must be issued by an insurance company rated in the highest rating category by Standard & Poor's Corporation and Moody's Investors Service. If any Bonds are sold to the Autltority as part of its SRF Program, the City shall give notice to the Authority before funding the Rescrve Account with such a surety bond "ihe Reservc Account shall constitute the margin for safety and protection against default in the payment of principal of and interest on the Bonds, the Outs[aztding Bonds and any Parity Bonds, and the moneys in the Reserve Account shall be used to pay eun~ent principal and inta~est on die bonds, the Outstanding Bonds and any Parity Bonds to the extent that moneys in the Band and Interest Account are insuftlcient for that purpose. Any deCeieney in the balance maintained in the Resewe Account shall be promptly made up from the next available Net Revenues remaining after credits imo.the Bond and Intcicst Account My moneys in the Resen~e Account in excess of die Reserve Requirenrent shall either be transferred to the Scwaee Wodcs 33- uxmsass Improvement Fetid or be used for the purchase of outstanding bonds or installments of principal of fully registered bonds. (d) The Sinking Fund, containing the bond and Interest Account and the Resetve Account, and the Construction Account, may be held by a financial institution acceptable to the Authority as part of its SRF Program, pursuant to terms acceptable [o theAuthority. If the Sinking Fund acid the accounts therein are held in trust, the City shall transfer the monthly required amowus of Ne[ Revenues to die Bond aed Interest Account and the Reserve Account in accordance with Section 14, and the financial institution holding such funds in trust shall be instructed to pay the required payments in accordance with the payment schedules foe the City's outstanding bonds. The financial institution selected to serve in this role may also serve as the Registrar and the Paying Agent for any series of the bonds and for all or any of the Outstanding Bonds. If the Construction Account is so held in trust, the City shall deposit the proceeds of the bonds therein until such proceeds are applied consistent with this ordinance and the Financial Assistance Agreement. The Mayor and the Clerk-Treasurer are hereby authorised to execute and deliver au agreement witlt a financial institution to reflect this tmst aaangetuent for aLl or a par[ of the Sinking Fund and the Construction Account in the form of mist agreement as approved by the Mayor and flte Clerk-Treasurer, consistent with the terms and pirovisions of this oidittance. Section 15. Sewage Works Improvement Fund. The Sewage Works Improvement Pund ("Improvement Fund") is hereby continued. Any excess revenues over and above the requirements of the O&M Pund end Sicking Fund may be lransfcn'ed or credited from the Kevenue Fund to the Improvement Pund, and said Bund shall be used for improvements. replacements. additions and extensions of the sewage works. Moneys in the Improvement Fund shall be transferred to dte Sinking Nund if necessary to prevcnta default in the payment of 34 - cao7sexs principal and interest on the then outstanding bonds or, if necessary, to eliminate any deficiencies in credits to or minimum balance in die Reserve Account of the Sinking Fnnd or may be transferred to the Operation and Maintenance Fund to meet unforeseen contingencies in the operation, repair and maintenance of the sewage works. Section 16. Maintenance oC Funds. The Sinking Fiend shall be deposited in and maintained as a separate aeeounr or accounts fi~om all other accounts of the City. "The 0&M Fund and flee Improvement Fund may be maintained in a single account, or accounts, bur such account, or accounts, shall likewise be maintained separate and apart from all other accounts of the City and apart Crom the Sinking Fund account or accounts. All moneys deposited in the accounts shall be deposited, held and secured as public funds in aceordaztce with the pubhe depository laws of the Sta[e of Indiana; provided tha[ moneys tlterein may be invested in obligations in accordance with the applicable laws, including particularly [C 5-L3, IC 4~-1 I and [C L3-18-13, as amended or supplemen[ed, and in the event of such investment the iueome tlieret}om shalt become a part of the funds invested and shall be used only as provided in this ordinance. Nothing in dies section or elsewhere in [his ordinance shall he construed to require that separate bank accounts he established and maintained for die Funds and Accounts cominued bythis ordinance. Section IZ Defeasance of the Bonds. Lf, when any of the Bonds issued hereunder shall have become due and payable in accordance with their teens or shall have been duly called for redemption or irrevocable instrnaions to call the Bonds or any portion thereof for redemption shall have been ;even, and the whole amount of the principal and dte interest and the premium, if any. so due and payable upon aII of [he bonds or any portion [hereof shall be paid; or (i) sufTicient moneys. or (ii) direct obligations of (including obligations issued or held in book _35_ i sonosiz entry form on the books of) the Department of the Treasury of the United States of America, die principal of and the interest on which when due will provide sufficient moneys, shall be held in nvst for such purpose, and provision shall also be made for paying all fees and expenses for the redemption, [hen and in that case the Bonds issued hereunder or any designated portion thereof shall no longer be deemed outstanding or entitled to the pledge of the Net Revenues of the City's sewage wod<s. Sectiou l8. Rate Covenant. The City covenants attd agrees that, by ordinance of the Comicil, it will establish just and equitable rates or charges for the use of and the service rendered by said works, to be paid by [he owner of each attd every to[, parcel of real estate a- building that is connected with and uses said sewage works by or through any pact of die sewage system of the City. or that in any way uses or is served by such works; that such rates or charges shall he sufficient in each year to provide for die payment of the proper and reasonable expenses of (a) Operation and Repair, as defined in the Financial Assistance Agreement, if any series of Bonds are sold to the Authority as part of its SRF Program, or (b) opc~ation, repair and maintenance if no Bonds are sold to the Authority as part of its SRF Program, of the works, and for die payment of the stuns required to be paid into the Sinking .Fund by the Act and this ordinance. Such sates and charges shall, if necessary, be changed and readjusted from time to time so that the revenues dtereH-om shall always be sufficient to meet the expenses of Operation and Maintenance or operation. repair and maintenance, as the case may be, of the sewage works, and die requirements of the Sinking Pund. The rates and charges so established shall apply to any and xll use of such works by and service rendered to the Cify and all dcparnnents thereof; and shall be paid by the City or the various departments thereof as the charges accrue. -i6- IRO'+9Ai.~ Section l9. Additional Bond Provisions. The City reserves the right to authorize and- issue additional BANS at any time ranking on a parity with the 6ANs. The City reserves the right to authorize and issue additional Parity Bonds payable out of the Net Revenues of its sewage works ranking on a parity with the Bonds for the pwpose of financing the cost of furore additions, extensions and improvements to the sewage works, or to refund obligations, subject to the following conditions: (a) ALl required payments into the Sinking Fund shall have been made in accordance with the provisions of [his ordinance, and the interest on and principal of all bonds payable from Nre Net Revenues of the sewage works shall have been paid to date in accordance with tlteir terms. The Reserve Requirement shall be satisfied for the additional Parity Bonds either at the time oC delivery of the additional Parity Bonds or over a five year or shorter period, in a manner whidi is emnmeusurate with the requirements established in Section 14 of this ordinance. (b) The Net Revenues of the sewage works in the fiscal yeaf~ immediately preceding the issuance of any such Parity Bonds shall be not less than one hundred twenty-flue percent (125°/~) of the maximum annual interest and principal requirements of the then outstanding bonds and [he additional Parity Bonds proposed to be issued: or, prior to the issuance of the Parity Bonds, the sewage rates and charges shall he increased sufficiently so that said increased sates and charges applied to the previous fsanl year's operations would have produced Net Revenues for said year equal to not less than one hundred twenty-fi~~e pcrccttt Q25%) of the maximum aiimtal interest and principal requirements of all bonds payable from. d~c revenues of [he sewage works. including the additional Parity Bonds proposedto he issued. Yor purposes oY this subsection_ the records of the sewage works' shall be analyzed and all showings prepared and certified by a certified public accountant employed by the City Cor that . ;7_ I,CO'19Si.? purpose, who shall certify that he has no pecuniary interest in said additions, extensions, and improvements or the financing thereof in any waywhatsoever other than to analyze the records of said sewage wod<s and to prepare said showings. (c) The interest on the additional Parity bonds shall be payable semiannuatty on the first days of January and July and the principal of, or mandatory sinking fund redemption dates for, the additional Parity Bonds shall be payable annually on January i. (d) A debt service reserve for the additional Parity Bonds commensurate with and proportional to the reserve established for the Bonds shall be created and maintained. Such reserve may be funded fi~om bond proceeds on the issue date of the Rarity Bonds or by Net Revenues over a period aot to exceed 60 months from the date of issuance of the Rarity Bonds. (e) So long as the Bonds are outstanding and owned by the Aufltority as par[ of the SRF Program, (i) the City obtains the consent of the Authority, (ii) the City has faithfully performed and is incompliance with each of its obligations, agreements and covenants contained in the financial Assistance Agreement and [Iris ordinance, and (iii) the City is in compliance with its National Rollutanl Discharge Elimination System permits, except for non-compliance for which purpose the Parity Bonds are issued, including refunding bonds issued prior lo, but pact of the overall plan to eliminate such non-compliance. Section 20. further Covenants of the Citv- Maintenance, Insurance Pledee Not to F_ncumhet, Subordinate Indebtedness. and Contract with Bondholders. For .the purpose of fwiher saleguarding the interests of the owners of [he Bonds and BANS. it is hereby specifically provided as follows: (a) All contracts let by [he Cih' in connection with die construction of the Project shall br let alter due advertiserncm asrequired by the laws of the State of Lndivta, and all 38 - vzoness contractors shall be required to furnish surety bonds in an amount equal to one hundred percent (100%) of [he amount of such contracts, to insure the completion of said contrzets in accordance with their Cerms, and such contractors shall also be required to carry such employer's liability and public liability insurance as aze required under the laws of the State of hrdiana in die case of public contracts, and shall be governed hi all respects by the laws of the State of htdiana relating to public contracts. (b) The Project shalt be constructed under the supervision and subject to the approval of such competent engineer as shall bedesignated by the City. All estimates for work done or material furnished shall first be checked by the engineer and approved by the City. (c) So tong as any of the Bonds or BANS are outstanding,. the City shall at all times maintain the sewage works system in good condition, and operate the same in an efficient manner and a[ a reasonable cos[. (d) So long as any of the Bonds or BANS are outstanding, the City shall maintain inswanee on the insurable parts of said works, of a kind and in an amount, including fidelity bonds, such as would normally be carried by private corporations engaged in a similar type of business and, if any Bonds or BANS are sold to the Authority as part oC its SRF Program. acceptable to the Authority. All inswznce shall be placed with responsible insurance companies qualified to do business under the laws of the State of Indiana. All insurance proceeds shall be used either in replacing or restoring the property destroyed or damaged, wiles if such 6ATrs or Bonds arc sold to the Authority as part of its SRF Program, the Fluthorily consents [o a different use (c) So long as any of the Bonds or BANS are outstanding the City shall not inorteaee. pledge or otherwise encumber the property and plant of its sewage works system, or ;q_ ico ;es;? any part thereof, nor shall it sell, lease or otherwise dispose of any part of the same, excepting only such machinery, equipment or other property as may be replaced, or shaft no longer he necessary for use in connection with said utility, provided, however, the City shall obtain the prior written consent of the Authoriy if such BANS or Bonds are sold to the Authority as part of its SRF Program. (~ For so long as the Bonds are outstanding and owned by the Aulho~i ty as pact of the SRF Program, the City shall not borrow any money, enter into any contract or agreement or incur any otlter liabilities in connection with the sewage wm$s, other than for normal operating expenditures, without the prior written consent of [he Authority if such undertaking would involve, commit or use the revenues of the sewage works. (g) Except as otherwise specifically provided in Section L9 of this ordinance, so long as any of the Bonds are outstanding, no additional bonds or other- obligations pledging any portion of the revenues of said sewage works shall be authorized, issued m- executed by the City except such as shall be made junior and subordinate in aft respects to the Bonds, unless all of the Bonds are redeemed or deceased coincidentally with the delivery of such additional bonds or other obligations. (h) The City shall take all action or proceedings necessary and proper, to the extent permitted by law, to require connection of all property where liquid and solid waste. sewage. nigh) soil or industrial waste is produced with available sanitary sewers. The City shall, insofar as possible, and to dte extent permitted by taw, cause all such sanitary sewers [o be connected with said scwaee works. (i) ~Ihe provisions of this ordinance shall constitute a conutid by and between the City and the owners oI the Bonds and BANS herein authorized, and after the issuance of the -40- 12U73YR52 Bonds or 6ANs, this ordinance shall not be repealed or amended in any respect which will adversety affect the rights or interests of the owners of the Bonds or BANS, nor shalt the Council adopt airy taw, ordinance or resofu[ion which in any way adversely affects the rghts of the holders of the Bonds or BANS so bng as any of the Bonds, BANS or the interest thereon, remain unpaid. Except in the case of changes. described in Section 2l(a){~, tltis ordinance may be amended, however, without the consent of Bond or BAN owners, if Ute Council determines, in its sole disa~etion, tltat such amendment would not adversely affect the owners of the Bonds or BANS; provided, however, that if the Bonds or BANS are sold to the Authority as pair of its SRF Program, the City shall obtain [he prior written consent of the Authority. Q) The provisions of [his ordutanee shall be construed to create a [rust in the proceeds of the sale of dte Bonds and BANS herein authorized for the uses aad purposes herein set forth, and the owners of the Bonds and 6ANs shall retain a lien on such proceeds until the same are applied in accordance with the provisions of this ordinance and of said governir~ Acl. The provisions of [his ordinance shall also be construed to create a trust in the Net Revenues herein directed to he set apart and paid into Ute Sinking Fund for the uses and purposes of that Fund as in this ordinance set forth. The owners of the Bonds shall have all the rights, remedies and privileges set forth iu [he provisions of the governing Ac[ hereinbeforc referred [o, including the light to have a receiver appointed to administer said sewage works, in die event the City shall fail or refuse to fix and collect suf}iciatt rates and charges for those proposes. or shall fail oi- refuse to operate and maintain said system and to apph' the revenues derived from die operation thereof, or i[ there be a default in the payment of the principal of or intaesl on any of the Bonds. Section 2l. Amendments with Consent of Bondholders. Suhject to the terms and provisions contained in this section and Section 20(i). and not otherwise.. the owners of not Icss 41 - vzorsexsz tlran sixty-six and two-thirds percent (66 2/3°/0) in aggregate principal amount of the Bonds issued pursuant to this ordinance and then outstanding shall have the right from time to time_ to cousent to and approve the adoption by the Council of the City of such ordinance or ordinances supplemental hereto or amendatory hereof, as shall be deemed necessary or desirable by. the City for the purpose of modifying, altering amending, adding [o or mscinding in any particular any of [he terms or provisions contained in this ordinance, or in any supplemental ordinance; provided. however, [hat if the bonds or BANS are sold [a the Authority as part of its SRF Program, the City shall obtain the prior written consent of the State of Indiana and provided, further that nothing herein contained shall permit or be consh'ued as penni[ting: (a) An extension of the maairity of the principal of or interest on, or any mandatory sinking fund redemption date for, airy Bond issued pursuant to this ordinance; or (b) A reduction in the principal amount of any Bond or the redemption premiwn or the tatc of interest thereon; or (c) The creation of a lien upon or a pledge of the revenues or Net 2evenues of the sewage wa-ks ranking prior to the pledge thereof created by Uiis ordinance; or (d) A preference or priority of any Bond or Bonds issued pursuant to this ordinance over any other Bond or Bards issued pursuant to the provisions of this ordinance; or (e) A reduction in the aggregate principal amount of [he Bonds required for consent to such supplemental ordinance; or (t) A reduction in the Reserve Requirement. Lf the owners of not less than sixty-six and two-thirds percent (66 2/3"/0) in aggregate principal amount of the bonds outstanding at [he time of adoption of such supplemental ordinance shall Gave consented m and approved the adoption thereof by written instrument to be 42 - I/20779frS2 maintained on file in the office of the Clerk-Treasurer of the Ciry, no owner of airy Bond issued pursuant to this ordinance shall have any might to object to the adoption of such supplemental ordirtaztce or ro object to any of the terms and provisions contained therein or the operation thereof, or in any manner to question the proptiery of the adoption thereof, or to enjoin or restrain the Council of the City from adopting the same, or from taking any action pursuant to the provisions thereof. Upon the adoption of any supplemental ordinance pursuant to the provisions of this section, this ordinance shall he, and shall be deemed, modified and amended in accordance therewith, and the respective rights, duties and obligations under this ordinance of the City and all owners of Bonds tlreu outstanding, shall thereafter be determined, exercised and enforced in accordance with this ordinance, subject in aLl respects to such modifications and amendments. Nohvithstanding anything contained in the foregoing provisions of this ordinance, the rights and obligations of the City and of the owners of [he Bonds authorized by this ordinance, and the terms and provisions of the Bonds and this ordinance, or airy supplemental or amendatory ordinance, may be modified or altered in any respect with the consent. of the City and the consent of the owners of all the bonds then outstanding. Section 22. Investment of Funds. (a) The Clerk-Treasurer is hereby authorized to invest moneys pursuant to the provisions of this ordinance and IC 5-I-14-3 (subject to applicable requirements of federal law to insure such yield is then conent market mte) to the extent necessary or advisable to preserve the exclusion from dross income of interest on [Ire Bonds and BFlNs under federal law_ (h) The Clerk-Treasurer shall kcep full and accurate records of investment earnines and income from moneys held in the Cunds and accounts continued or referenced herein. hr order to comply with the provisions of the ordinance, the Clerk-Treasurer is hereby authorized I P_o73VNi.2 4.i and directed to employ consultants or attorneys from time to time to advise the City as to requirements of Cedexal law to preserve the tax exclusion. 'Che Cled<-Treasurer may pay any fees as operation expenses of the sewage works. Section 23. Tax Covenants. Li order m preserve the exclusion of interest on [hc Bonds and the BANS Crom gross income for federal tax purposes under Section 103. of ttte Internal Revenue Code of 1986 as existing on the date of issuance of the Bonds or the BANS, as [he case may be ("Code") and as an inducement to purdrasers of the 6ouds and the BANS. the City represents. covenants and agrees [hat: (a) The sewage works will be available for use by members of the general public. Use by a member oC the general public means use by nawral persons not engaged in a bade or business. No person or entity other that [hc City or another state or local governmental unit will use more than 10% of ttu pmcezds of the Bonds or [he BANS or property financed by the Bond or RAN proceeds other than as a member of the general public. No person or entity other Than the City or anodher state or local govemmentnl unit will own property Financed by Bond or BAN proceeds or will have any actual or beneficial use of such property pursuant to a lease, management, service or incentive payment contract, an artangement including takror-pay or other type of output contracts or any other type of arrangement that conveys other special legal entitlements and differentiates that person's or entity's use of such property tlom use by the general public. unless such uses in the aggraga[c relate to no more than 10 % of the proceeds of the Bonds or [he BANS. as [he case may he. If the City enters into a management contract for all or a portion of the sewage works. [he teens oCthe contract will comply kith the Regula[imts and IRS Kevemre Procedure 97-13. as amended, supplemented or superseded. from time to time. su that the contract will not give rise to private business use under the Code and the [Zegulations }t_ ieo~ies~? unless such use in the aggregate will not relate to more than 10°/u of the proceeds of the Bonds or the BANS, as the casemay be. (b) No more tltan ! 0% of the principal of or interest on the Bonds or BANS is (under [he terms of the Bonds or the BANS, this ordinance or any underlying arrangement), directly or indirectly, secured by an interest iu property used or to be used for private business use or payments in respect of such property, or to be derived from payments (whether or not to the City) in respect of such property or borrowed money used or to be used for a private business use. (c) No more than 5% of the bond or BAN proceeds will be loaned to any person or entity other than another state or local governmental unit. No more than 5% of the Bond or BAN proceeds will be nznsfetied, directly or indvectly, or deemed transfeaed to a nongovernmental puson in any mariner that would in substance constitute a loan of the Bond or BAN proceeds. (d) The City reasonably expects, as of [he date hereof, thnl the Bonds and BANS will not meet either the private business use test described in paragraphs (a) and (b) above or the private loan test dese~ibed in paragraph (c) above dining the entire teen of the Bonds or BANS. as the case may be. (e) No mole than 5°/ of the proceeds of the Bonds or BANS will be al[ributablc to private business use as described in (a) and private secw-i[y or payments described i^ (b) attnbu[able to unrelated or disproportionate private business us'e. For this pwpose, the private business use test is applied by taking inm account only use that is not related to any government use of proceeds of the issue (Unrelated Use) and use that is related but disproportionate to any governmental use of tltose proceeds (Disproportionate Use). 45 - in_oraexsz (~ The City will not take any action nor fail to lake any action with respect to the Bonds or BANS that would result in the loss of the exclusion from gross income for federal tax purposes of interest on the Bonds or BANS pursuant to Section 103 of the Code, nor will the City act in any other manner which would adversely affect such exclusion, and it will no[ make any investment or do any other act or thing during the period that the Bouds or BANS are outstanding which would cause the Bonds or BANS to be private activity bonds under the meaning of Section 14L of the Code. (g) It shalt be not an event of default under this ordinance iC the interest on any Bond or BAN is not excludable from gross income for federal tax purposes or otherwise pursuant to airy provision of the Code which is not currently in effect and in existence on the date of issuance of the bonds or BANS, as the case may be. (h) The Ciq= represents that it will rebate any arbitrage profits to the United States in accordance with ttte Code. (i) The Mayor and Clerk-Treasurer are authorized to designate any series of [fonds and BANS as qualified tax-exempt obligations under Section 265(b)(3) of the Code iC the requirements of such Section of [he Code are me[ for any series of bonds or BANS. (j) These covenants arc based solely on current law in effect and in existence on the date of delivery of such Bouds or BANS, as the case may be. Section 24. issuance of BANS. (a) The City, having satisfied all the statutop~ requirements for the issuance of its Bonds. may elect to issue its BAN or BANS pursuant [o a Braid Anticipation Note Pw-chase Agrcement ("Bond Anticipation No[e Agreement") to he entered into between the City and the purchaser of the BAN or BANS. Lf the BANS are sold to [he Audiorih as part of its SRF Program, the Financial Assistance Agreement shall serve as [he 1;20939852 a~- Bond Anticipation Note Agreement. The Cotmcil hereby authorizes the issuance and execution of dte BAN or BANS in lieu of initially issuing bonds to provide interim financing for the Project until permanent fuancing becomes available. It shall nol be necessary for the City m repeat the procedm-es for the issuauce of its Bonds, as the procedw~cs followed before the issuance of the BAN or BANS are for all purposes sufficient to authorize the issuance of the Bondsand the use of the proceeds to repay the BAN or BANS. The Mayor and the Clerk-Treasurer are hereby authorized and directed to execute a Bond Antieipadon Note Agreement or Financial Assistance Agreement (and any amendments made from time to time) in such form or substance as tltey shall appFOVe acting upon the advice of counsel. The Mayor and the Clerk-Treasw~er may also take such other actions or deliver such otlier certificates as are necessary or desirable in connection with the issuance of the BANS or the Bonds and the other documents needed for the financing as they deem necessary or desirable in connection therewith. Section 2S NoncompLiattce with Pax Covenants. Notwithstanding any other provisions of this ordinance, the covenants and authorizations contained in this ordinance ("Tax Sections") which are designed to preserve the exclusion of interest on the Bonds and BANS from gross income under federal law ("Tax Exemption") need not be complied witlt if the City receives an opinion of nationally recognized bond counsel tlrat any Tax Section is unnecessary to preserve the Tax exemption. Section 26. Rates and Charges. The estimate of the rates and charges of the sewage works are set forth in Ordinance No. 2001-OR-14 and No. 2004-0R-46 adopted on June 4,3001 and December 6, 2004, respectively. Said ordinances are hereby incorporated herein by rcJcrarce. _¢]_ Section 27. Conflietina Ordinances. All ordinances and pmts of ordinances in eouflici herewith ue hereby repealed; provided, however, that this ordinance shall not be deemed as (i) amending or repealing dre ordinances authorizing the Outstanding Bonds or (ii) adversely affecting the rights of the owners of the Outstanding Bonds. Section 28. Headin¢s. The headings or titles of the several sections shall be solely for convenience of reference and shall not affect the meaning construction or effect of This ordinance. Section 29. Effective Date. This ordinance shall be in full force and effect from and after its passage and execution by the Mayor. _qg_ v>_oroai.z Passed and adopted by the Common Council of the City of ]effersonville this J ~ day of t71 ,2008. COMMON. COUNCIL G' ~ ~ Presiding P f~frper Attest ClerkVA 7leasurer Presented by me to the Mayor of the City of Jeffersonville this ~~ day of ~~_ /.2008 at _. m. QAOn(~ AA ~ A I 'I ~freasurer ""~~..//~~ Signed and approved by me, the Mayor of the City of Jeffersonville, this ~~day of .2008 at_ _. m: ~.ty i ~ ~ Mayor -49- t~u~sas z EXH1B[T A Description of Projects Authorized under 2005 Ordinance The overall purpose of this project is twofold: first, to upgizde die City's sanitary sewage nreatment and collection system to increase its capacity to Keep up with current and expected growth trends, and second, to begin to implement the combined sewer overflow long-term controlplan (CSO LTCP) projects that will reduce combined sewer emissions into the environment. The sanitary sewage treatment and collection improvement projects include [he following: 1. Expansion of [he existing S2 mgd downtown wastewater treatinen[ plant by adding anoxic cones, and replacement oC the existing chlorine disinfection system with ultraviolet light. 2. A second expansion to the downtown wastewater treatment plant From 6.0!25.0 mgd to 8.0/34.0 mgd. 3. Upe ade and expansion of several pwnping stations, including Millcreek, and Riverpor[ 1, and construction of a new pumping station al dte Lentzier Creek Basin. The wod< includes installation and/or replacement of existing force mains. 1. Constitiction of collection systems to sen~c unsewemd areas within the city limits. The projects proposed for the Cu-st (we (S) years by the CSO Iona term control plan include separation and elimination of discharge points, implementation of inflow reduction programs; installation oC solids and Ooatables' controls at remaining CSO's, and rerouting contributing sanitary s}stems that flow through the combined sewer area to available sanitary col lecro~5. EXHIBIT B Description of Project The installation of sanitary sewers, two pumping stations, pressure Force mains, and service connections to serve approximately eighty (80) residences in Long View Beach, a riverside community that cw~renfly has septic tanks which are LeaL<ing mw sewage into the Ohio River. The septic tanks and die pollution problem will be eliminated by the project. uzo~sox>a