HomeMy WebLinkAbout026 - 07/06/1993 - AUTHORIZING THE ISSUANCE OF SALES AND USE TAX REVENUE REFUNDING BONDS SERIES 1993, IN THE AMOUNT OF � f
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ORDINANCE NO. 26, 1993
AN ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF FORT
COLLINS, COLORADO, SALES AND USE TAX REVENUE REFUNDING
BONDS, SERIES 1993, DATED JUNE 1, 1993, IN THE AGGREGATE
PRINCIPAL AMOUNT OF $26,210, 000.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS, COLORADO, THAT:
Section 1. Definitions and Construction.
A. Definitions. In this Ordinance the following terms
have the following respective meanings unless the context hereof
clearly requires otherwise:
(1) Act: part 1 of article 56 of title 11,
Colorado Revised Statutes, as amended.
(2) Additional Parity Bonds: any Parity Securities
issued after the issuance of the Bonds.
(3) Average Annual Debt Service Requirements: the
aggregate of all Debt Service Requirements (excluding any
redemption premiums) due on the Bonds or any other given issue
of Parity Securities or any portion thereof for all Bond Years
beginning with the Bond Year in which Debt Service
Requirements of the Bonds or such Parity Securities or any
portion thereof are first payable after the computation date
and ending with the Bond Year in which the last of the Debt
Service Requirements are payable divided by the whole number
of such years.
(4) Beneficial Owners: those Persons having
beneficial ownership interests in Bonds registered in the name
of the Securities Depository or a nominee therefor.
(5) Bond Purchase Agreement: the Bond Purchase
Agreement, dated June 10, 1993, between the City and the
Purchaser.
(6) Bonds: the City of Fort Collins, Colorado,
Sales and Use Tax Revenue Refunding Bonds, Series 1993 , dated
June 1, 1993, in the aggregate principal amount of
$26,210, 000.
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(7) Bond Insurance Policy: the municipal bond new
issue insurance policy issued by the Bond Insurer that
guarantees payment of principal of and interest on the Bonds.
(8) Bond Insurer: Financial Guaranty Insurance
Company, a New York stock insurance company, or its
successors.
(9) Bond Year: the twelve (12) months commencing
on the second day of December of any calendar year and ending
on the first day of December of the next succeeding calendar
year.
(10) Charter: the Home Rule Charter of the City, as
amended.
(11) City: the City of Fort Collins, Colorado.
(12) Code: the Code of the City.
(13) Combined Average Annual Debt Service
Requirements: the sum of the Average Annual Debt Service
Requirements for all issues of Bonds or Parity Securities or
portions thereof for which the computation is being made.
(14) Combined Maximum Annual Debt Service
Requirements: the Maximum Annual Debt Service Requirements
for all issues of Bonds or Parity Securities or portions
thereof for which the computation is being made, treated as a
single issue.
(15) Commercial Bank: a state or national bank or
trust company which is an eligible public depository under the
laws of the State, a member of the Federal Deposit Insurance
Corporation and a member of the Federal Reserve System, which
(unless otherwise approved by the Bond Insurer) has a combined
capital and surplus of $3, 000, 000 or more, and which is
located within the United States of America.
(16) Commitment: the Commitment for Municipal Bond
Insurance, dated May 19, 1993, from the Bond Insurer to the
City.
(17) Comparable Bond Year: in connection with any
Fiscal Year, the Bond Year which ends in such Fiscal Year.
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For example, for the Fiscal Year commencing on January 1,
1994, the Comparable Bond Year for the Bonds commences on
December 2, 1993, and ends on December 1, 1994 .
(18) Council: the governing body of the City.
(19) Debt Service Requirements: the principal of,
interest on and any premium due in connection with the
redemption of the Bonds, any Additional Parity Bonds, any
Parity Securities and any other securities payable from the
Pledged Revenues.
(20) Escrow Account: the special fund created in
Section 5A hereof.
(21) Escrow Agreement: the Escrow Agreement, dated
as of June 1, 1993, between the City and the Escrow Bank.
(22) Escrow Bank: Colorado National Bank, Denver,
Colorado, or its successors.
(23) Event of Default: one of the events described
in Section 10A hereof.
(24) Excess Investment Earnings Account: the
special fund created and referred to in Section 5I hereof.
(25) Federal Securities: bills, certificates of
indebtedness, notes, bonds or similar securities which are
direct obligations of the United States of America or, if the
Bond Insurer agrees in writing, are obligations the principal
and interest of which are unconditionally guaranteed by the
United States of America.
(26) Fiscal Agent: Citibank, N.A. , New York, New
York, or its successors.
(27) Fiscal Year: the twelve (12) months commencing
on the first day of January of any calendar year and ending on
the last day of December of such calendar year or such other
twelve-month period as may from time to time be designated by
the Council as the Fiscal Year of the City.
(28) Independent Accountant: any certified public
accountant, or any firm of such accountants, duly licensed to
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practice and practicing as such under the laws of the State,
appointed and paid by the City, who (a) is, in fact,
independent and not under the domination of the City or the
Council, (b) does not have any substantial interest, direct or
indirect, in any of the affairs of the City, and (c) is not
connected with the City as a member, officer or employee of
the Council, but who may be regularly retained to make annual
or similar audits of any books or records of the City.
(29) Interest Payment Date: a date designated by
ordinance for the payment of interest on the Bonds or any
other designated security.
(30) Letter of Representations: the letter of
representations, dated as of June 1, 1993, from the City and
the Paying Agent to the Securities Depository.
(31) Maturity Date: a date designated by ordinance
for the payment of principal on the Bonds or any other
designated securities.
(32) Maximum Annual Debt Service Requirements: the
maximum aggregate amount of Debt Service Requirements
(excluding redemption premiums) due on the Bonds or any other
given issue of Parity Securities or any portion thereof in any
Bond Year beginning with the Bond Year in which Debt Service
Requirements of the Bonds or such Parity Securities or any
portion thereof are first payable after the computation date
and ending with the Bond Year in which the last of the Debt
Service Requirements are payable.
(33) Net Revenue: the amount of Sales and Use Tax
collected by the City (after deduction by the retailer or
vendor of the 3% collection expense allowance) .
(34) Ordinance: this Ordinance No. 26, 1993, of the
City.
(35) Ordinance No. 58 , 1967: Ordinance No. 58,
1967, of the City which provides for the imposition of the
initial one percent (1%) Sales and Use Tax within the City.
(36) Ordinance No. 140, 1979: Ordinance No. 140,
1979, of the City, which provides for the imposition of the
additional one percent (1%) Sales and Use Tax within the City.
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(37) Ordinance No. 149, 1981: Ordinance No. 149,
1981, of the City, which provides for the imposition of the
additional twenty-five hundredths percent ( . 25%) Sales and Use
Tax within the City.
(38) Outstanding or outstanding: as of any
particular date, all Bonds, Additional Parity Bonds, Parity
Securities or any such other securities payable in whole or in
part from the Pledged Revenues which have been authorized,
executed and delivered except the following:
(a) Any Bond, Additional Parity Bond, Parity
Security or other security cancelled by the City, by the
Paying Agent or otherwise on the behalf of the City on or
before such date;
(b) Any Bond, Additional Parity Bond, Parity
Security or other security held by or on behalf of the
City;
(c) Any Bond, Additional Parity Bond, Parity
Security or other security of the City for the payment or
the redemption of which moneys or Federal Securities
sufficient (including the known minimum yield available
for such purpose from Federal Securities in which such
amount wholly or in part may be initially invested) to
meet all of the Debt Service Requirements of such Bond,
Additional Parity Bond, Parity Security or other security
to the Maturity Date or specified Redemption Date thereof
shall have theretofore been deposited in escrow or in
trust with a Trust Bank for that purpose; and
(d) Any lost, destroyed, or wrongfully taken
Bond, Additional Parity Bond, Parity Security or other
security of the City in lieu of or in substitution for
which another bond or other security shall have been
executed and delivered.
(39) Owner: the holder of any bearer instrument or
registered owner of any registered instrument.
(40) Parity Securities: bonds, warrants, notes,
securities, leases or other contracts evidencing borrowings
and payable from the Pledged Revenues equally or on a parity
with the Bonds.
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(41) Participants: underwriters, securities brokers
or dealers, banks, trust companies, closing corporations or
other Persons for which or whom the Securities Depository
holds the Bonds.
(42) Paying Agent: Colorado National Bank, Denver,
Colorado, or its successors.
(43) Permitted Investments: to the extent permitted
by the ordinances of the City and, to the extent applicable,
the laws of the State, any of the following obligations:
(a) Direct obligations of the United States of
America and securities fully and unconditionally
guaranteed as to the timely payment of principal and
interest by the United States of America, provided that
the full faith and credit of the United States of America
must be pledged to any such direct obligation or
guarantee (collectively, "Direct Obligations") ;
(b) Direct obligations and fully guaranteed
certificates of beneficial interest of the Export-Import
Bank of the United States; consolidated debt obligations
and letter of credit-backed issues of the Federal Home
Loan Banks; participation certificates and senior debt
obligations of the Federal Home Loan Mortgage Corporation
("FHLMCs") , debentures of the Federal Housing
Administration; mortgage-backed securities (except
stripped mortgage securities which are valued greater
than par on the portion of unpaid principal) and senior
debt obligations of the Federal National Mortgage
Association ("FNMAs") ; participation certificates of the
General Services Administration; guaranteed
mortgage-backed securities and guaranteed participation
certificates of the Government National Mortgage
Corporation ("GNMAs") ; guaranteed participation
certificates and guaranteed pool certificates of the
Small Business Administration; debt obligations and
letter of credit-backed issues of the Student Loan
Marketing Association; local authority bonds of the U.S.
Department of Housing and Urban Development; guaranteed
Title XI financings of the U.S. Maritime Administration;
guaranteed transit bonds of the Washington Metropolitan
Area Transit Authority; and Resolution Funding
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Corporation securities (collectively, "Agency
Obligations") ;
(c) Direct obligations of any state of the
United States of America or any subdivision or agency
thereof whose unsecured, uninsured and unguaranteed
general obligation debt is rated, at the time of
purchase, "A" or better by Moody's Investors Service,
Inc. and "A" or better by Standard & Poor's Corporation,
or any obligation fully and unconditionally guaranteed by
any state, subdivision or agency whose unsecured,
uninsured and unguaranteed general obligation debt is
rated, at the time of purchase, "A" or better by Moody's
Investors Service, Inc. and "A" or better by Standard &
Poor's Corporation;
(d) Commercial paper (having original
maturities of not more than 270 days) rated, at the time
of purchase, "P-1" by Moody's Investors Service, Inc. and
"A-1" or better by Standard & Poor's Corporation;
(e) Federal funds, unsecured certificates of
deposit, time deposits or bankers acceptances (in each
case having maturities of not more than 365 days) of any
domestic bank including a branch office of a foreign bank
which branch office is located in the United States,
provided legal opinions are received to the effect that
full and timely payment of such deposit or similar
obligation is enforceable against the principal office or
any branch of such bank, which, at the time of purchase,
has a short-term "Bank Deposit" rating of 11P-1" by
Moody's Investors Service, Inc. and a "Short-Term CD"
rating of "A-1" or better by Standard & Poor's
Corporation;
(f) Deposits of any bank or savings and loan
association which has combined capital, surplus and
undivided profits of not less than $3, 000, 000, provided
such deposits are continuously and fully insured by the
Bank Insurance Fund or the Savings Association Insurance
Fund of the Federal Deposit Insurance Corporation;
(g) Investments in money-market funds rated
"AAAm" or "AAAm-G" by Standard & Poor's Corporation;
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(h) Repurchase agreements collateralized by
Direct Obligations, GNMAs, FNMAs, or FHLMCs with any
registered broker/dealer subject to the Securities
Investors' Protection Corporation jurisdiction or any
Commercial Bank insured by the Federal Deposit Insurance
Corporation, if such broker/dealer or Commercial Bank has
an uninsured, unsecured and unguaranteed obligation rated
"P-1" or 11A3" or better by Moody's Investors Service,
Inc. and "A-1" or "A-" or better by Standard & Poor's
Corporation, provided:
1. a master repurchase agreement or
specific written repurchase agreement governs the
transaction, and
2. the securities are held free and
clear of any lien by the City or an independent
third party acting solely as agent ("Agent") for
the City, and such third party is a Federal Reserve
Bank, a bank which is a member of the Federal
Deposit Insurance Corporation and which has
combined capital, surplus and undivided profits of
not less than $50, 000, 000, or a bank approved in
writing for such purpose by the Bond Insurer, and
the City shall have received written confirmation
from such third party that it holds such
securities, free and clear of any lien, as agent
for the City, and
3 . a perfected first security interest
under the Uniform Commercial Code, or book entry
procedures prescribed at 31 CFR 306. 1 et sea. or 31
CFR 350.0 et sea. in such securities is created for
the benefit of the City, and
4. the repurchase agreement has a term
of one hundred eighty (180) days or less, and the
City or the Agent will value the collateral
securities no less frequently than weekly and will
liquidate the collateral securities if any
deficiency in the required collateral percentage is
not restored within two (2) business days of such
valuation, and
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5. the fair market value of the
securities in relation to the amount of the
repurchase obligation, including principal and
interest, is equal to at least one hundred three
percent (103%) .
(44) Person: any individual, f irm, partnership,
corporation, company, association, joint-stock association, or
body politic or any trustee, receiver, assignee, or other
similar representative thereof.
(4 5) Pledged Revenues: the Net Revenue collected by
the City from the Sales and Use Tax plus any amounts
designated as "supplemental user fees" under that certain
Master Agreement, dated December 31, 1982, as amended, between
the City and Anheuser-Busch, Incorporated which are payable on
account of obligations issued by the City and payable from the
Net Revenue plus all income or gain, if any, from any
investment of the foregoing and of the proceeds of Securities
payable from the Pledged Revenues (except any income or gain
from investment of the proceeds of Securities deposited in the
Escrow Account or other similar fund or account or required to
be deposited in the Excess Investment Earnings Account) .
(46) Preliminary Official Statement: the
Preliminary Official Statement, dated March 18, 1993, relating
to the Bonds.
(47) Principal and Interest Account: the special
fund created by Ordinance No. 87, 1981, of the City and
referred to in Section 5C hereof.
(48) Prior Bonds: the City of Fort Collins,
Colorado, Sales and Use Tax Revenue Refunding and Improvement
Bonds, Series 1986, dated August 1, 1986, in the original
aggregate principal amount of $30, 060, 000.
(49) Purchaser: the syndicate managed by George K.
Baum & Company, Denver, Colorado.
(50) Redemption Date: the date fixed for the
redemption prior to maturity of any Bonds or other designated
securities payable from the Pledged Revenues in any notice of
prior redemption given by or on behalf of the City.
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(51) Registrar: Colorado National Bank, Denver,
Colorado, or its successors.
(52) Regular Record Date: the fifteenth day of the
calendar month next preceding an Interest Payment Date for the
Bonds.
(53) Reserve Account: the special fund created by
Ordinance No. 87, 1981, of the City and referred to in
Section 5D hereof.
(54) Sales and Use Tax: the sales and use tax
established by Ordinance No. 58, 1967, Ordinance No. 140,
1979, and Ordinance No. 149, 1981, upon sales and purchases of
tangible personal property at retail and storage, use,
distribution and consumption of tangible personal property
purchased or acquired at retail, within the City, in such
percentages as set forth in such Ordinances or any supplements
or amendments thereof.
(55) Sales and Use Tax Fund: the special fund
created by Ordinance No. 87, 1981, of the City and referred to
in Section 5B hereof.
(56) Securities Depository: The Depository Trust
Company, a limited purpose trust company organized under the
laws of the State of New York.
(57) Security or securities: any bond issued by the
City or any other evidence of the advancement of money to the
City.
(58) Special Record Date: the date fixed by the
Paying Agent for the determination of ownership of Bonds for
the purpose of paying interest not paid when due or interest
accruing after maturity.
(59) State: the State of Colorado.
(60) Subordinate Bonds or Subordinate Securities:
bonds or securities payable from the Pledged Revenues having
a lien thereon subordinate or junior to the lien thereon of
the Bonds.
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(6) In the event that any Bond issued under this
Ordinance is not insured by the Bond Insurer, no provision of
this Ordinance referring to the Bond Insurer or the Bond
Insurance Policy or making covenants or agreements for the
benefit of the Bond Insurer shall be applicable to such Bond,
unless the context thereof clearly requires otherwise, and all
such provisions shall be read as applicable only to the
insured Bonds.
Section 2 . Recitals.
A. Prior Bonds. The City has heretofore issued and
sold the Prior Bonds.
There is Outstanding of the Prior Bonds the aggregate
principal amount of $23,530, 000, maturing on the following dates in
the following years in the following aggregate principal amounts
and bearing interest at the following per annum interest rates:
Principal
Dates Amounts Interest Rates
December 11 1993 $ 615, 000 6.550%
June 11 1994 635, 000 6.750
December 11 1994 655, 000 6.750
June 11 1995 680, 000 7. 000
December 11 1995 700, 000 7. 000
June 11 1996 725, 000 7. 150
December 1, 1996 755, 000 7. 150
June 11 1997 780,000 7 . 350
December 11 1997 810, 000 7. 350
June 11 1998 840, 000 7.450
December 11 1998 870, 000 7 .450
June 11 1999 900, 000 7.450
December 11 1999 935, 000 7.450
June 11 2000 970, 000 7. 500
December 11 2000 11005, 000 7 .500
December 1, 2004 6, 155, 000 7. 625
December 11 2009 51500, 000 6.500
The Prior Bonds maturing in the years 1993 through 1996
are not subject to optional redemption prior to their respective
Maturity Dates. The Prior Bonds maturing in the year 1997 and
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"^ A
thereafter are subject to optional redemption prior to their
respective Maturity Dates, in whole or in part in inverse order of
maturity and by lot within a maturity, on December 1, 1996, and on
any Interest Payment Date thereafter at a price equal to the
principal amount of each Prior Bond so redeemed plus accrued
interest thereon to the Redemption Date plus a premium expressed as
a percentage of the principal amount of each Prior Bond so
redeemed, depending on the Redemption Date, as follows:
Redemption Dates Premiums
December 1, 1996, and June 1, 1997 2 . 0%
December 1, 1997, and June 1, 1998 1. 0
December 1, 1998, and Thereafter None
The City wishes to refund, pay and discharge the Prior
Bonds in order to reduce the net effective interest rate; reduce
the total interest payable; reduce the total principal and interest
payable or the principal and interest payable in any particular
year or years, or effect other economies; or any combination of the
foregoing.
B. Authority. Pursuant to art. XX, sec. 6 of the State
Constitution, Art. V, Sections 19.3 and 19.4 of the Charter, and
the Act, the City is authorized by Council action and without an
election to issue the Bonds for the purpose of refunding, paying
and discharging the Prior Bonds. Pursuant to art. X, sec. 2 0 (4) (b)
of the State Constitution, the Bonds may be issued without voter
approval for the purpose of refinancing the Prior Bonds at a lower
interest rate.
Section 3 . The Bonds.
A. Authorization. The Bonds are hereby authorized to
be issued for the aforesaid purposes.
B. Bond Details.
(1) Generally. The Bonds shall be issuable in
fully registered form and shall initially be registered in the
name of the Securities Depository or a nominee therefor.
Purchases by Beneficial Owners shall be made in book-entry
form in the principal amount of $5, 000 or any integral
multiple thereof. The Beneficial Owners shall not receive
certificates evidencing their interests in the Bonds. No Bond
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shall be issued in any denomination larger than the aggregate
principal amount maturing on the Maturity Date of such Bond,
and no Bond shall be made payable on more than one Maturity
Date. The Bonds shall be initially issued so that a single
Bond shall evidence the obligation of the City to pay all
principal due on each of the Maturity Dates set forth herein.
Pursuant to the recommendations of the Committee on
Uniform Security Identification Procedures, CUSIP numbers may
be printed on the Bonds.
The Bonds shall mature on the following dates in the
following aggregate principal amounts and shall bear interest
from June 1, 1993, or the Interest Payment Dates to which
interest has been paid next preceding their respective dates,
whichever is later, to their respective Maturity Dates, except
if redeemed prior thereto, at the following per annum interest
rates:
Principal
Dates Amounts Interest Rates
December 11 1993 860, 000 2 .400%
June 11 1994 820, 000 2 .700
December 11 1994 890, 000 2 .700
June 11 1995 840, 000 3 .400
December 11 1995 915, 000 3 .400
June 11 1996 870, 000 3 .800
December 11 1996 945, 000 3 .800
June 11 1997 905, 000 4. 100
December 11 1997 980,000 4 . 100
June 11 1998 945, 000 4.400
December 11 1998 11025,000 4.400
June 11 1999 985, 000 4. 600
December 1, 1999 11065, 000 4. 600
June 11 2000 11030, 000 4.750
December 11 2000 11115, 000 4 .750
June 11 2001 11080, 000 4.900
December 11 2001 11175, 000 4.900
June 11 2002 11135, 000 5. 000
December 1, 2002 11230, 000 5. 000
June 11 2003 435,000 5. 000
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December 11 2003 470, 000 5. 000
June 11 2004 455, 000 5. 100
December 11 2004 490, 000 5. 100
December 11 2006 21045, 000 5.375
December 11 2009 31505, 000 5.375
Said interest shall be payable on December 1, 1993 , and
semiannually thereafter on the first day of June and the first
day of December of each year. If upon presentation at
maturity the principal of any Bond is not paid as provided
herein, interest shall continue thereon at the same interest
rate until the principal is paid in full.
The Debt Service Requirements of the Bonds shall be
payable in lawful money of the United States of America, to
the Owners of the Bonds by the Paying Agent. The principal
and the final installment of interest shall be payable to the
Owner of each Bond upon presentation and surrender thereof at
maturity or upon prior redemption, by check or draft mailed to
such Owner at the address appearing on the registration books
of the City maintained by the Registrar or by wire transfer to
such bank or other depository as the Owner shall designate in
writing to the Paying Agent. Except as hereinbefore and
hereinafter provided, the interest shall be payable to the
Owner of each Bond determined as of the close of business on
the Regular Record Date, irrespective of any transfer of
ownership of the Bond subsequent to the Regular Record Date
and prior to such Interest Payment Date, by check or draft or
wire transfer directed to such Owner as aforesaid. Any
interest not paid when due and any interest accruing after
maturity shall be payable to the Owner of each Bond entitled
to receive such interest determined as of the close of
business on the Special Record Date, irrespective of any
transfer of ownership of the Bond subsequent to the Special
Record Date and prior to the date fixed by the Paying Agent
for the payment of such interest, by check or draft or wire
transfer directed to such Owner as aforesaid. Notice of the
Special Record Date and of the date fixed for the payment of
such interest shall be given by sending a copy thereof by
certified or registered first-class, postage-prepaid mail, at
least fifteen (15) days prior to the Special Record Date, to
the Owner of each Bond upon which interest will be paid
determined as of the close of business on the day preceding
such mailing at the address appearing on the registration
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books of the City. Any premium shall be payable to the Owner
of each Bond redeemed upon presentation and surrender thereof
upon prior redemption, by check or draft or wire transfer
directed to such Owner as aforesaid. If the date for making
or giving any payment, determination or notice described
herein is a Saturday, Sunday, legal holiday or any other day
on which the office of the Paying Agent or Registrar is
authorized or required by law to remain closed, such payment,
determination or notice shall be made or given on the next
succeeding day which is not a Saturday, Sunday, legal holiday
or other day on which the office of the Paying Agent or
Registrar is authorized or required by law to remain closed.
So long as the Owner of any Bond is the Securities
Depository or a nominee therefor, the Securities Depository
shall disburse any payments received, through its Participants
or otherwise, to the Beneficial Owners.
Neither the City nor the Paying Agent shall have any
responsibility or obligation for the payment to any
Participant, any Beneficial Owner or any other Person (except
an Owner of Bonds) of the Debt Service Requirements of the
Bonds.
Notwithstanding any other provision of this
Ordinance to the contrary, so long as any Bond is registered
in 'the name of Cede & Co. , as nominee for the Securities
Depository, all payments with respect to the Debt Service
Requirements of the Bonds shall be made in the manner provided
in the Letter of Representations.
(2) Payments Under the Bond Insurance Policy. If
on the third day preceding any Interest Payment Date there is
not on deposit with the Paying Agent sufficient moneys
available to pay all principal of and interest on the Bonds
due on such date, the Paying Agent shall immediately notify
the Bond Insurer and its Fiscal Agent of the amount of such
deficiency. If by said Interest Payment Date the City has not
provided the amount of such deficiency, the Paying Agent shall
notify the Registrar which shall simultaneously make available
to the Bond Insurer, to the Paying Agent and to the Fiscal
Agent the registration books for the Bonds maintained by the
Registrar.
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In addition, the Paying Agent shall provide the Bond
Insurer with a list of the Owners entitled to receive
principal or interest payments from the Bond Insurer under the
terms of the Bond Insurance Policy and shall make arrangements
for the Bond Insurer and its Fiscal Agent to mail checks or
drafts to Owners entitled to receive full or partial interest
payments from the Bond Insurer and to pay principal of the
Bonds surrendered to the Fiscal Agent by the Owners entitled
to receive full or partial principal payments from the Bond
Insurer.
In addition, the Paying Agent shall, at the time the
registration books are made available to the Bond Insurer,
notify Owners entitled to receive the payment of principal of
or interest on the Bonds from the Bond Insurer as to the fact
of such entitlement, that the Bond Insurer will remit to them
all or part of the interest payments coming due subject to the
terms of the Bond Insurance Policy, that, except as provided
below, in the event that any Owner is entitled to receive full
payment of principal from the Bond Insurer, such Owner must
tender his Bond with the instrument of transfer in the form
provided on the Bond executed in the name of the Bond Insurer,
and that, except as provided below, in the event that such
Owner is entitled to receive partial payment of principal from
the Bond Insurer, such Owner must tender his Bond for payment
first to the Paying Agent, which shall note on such Bond the
portion of principal paid by the Paying Agent, and then, with
an acceptable form of assignment executed in the name of the
Bond Insurer, to the Fiscal Agent, which will then pay the
unpaid portion of principal to the Owner subject to the terms
of the Bond Insurance Policy.
In the event that the Paying Agent has notice that
any payment of principal of or interest on a Bond has been
recovered from an Owner pursuant to the United States
Bankruptcy Code by a trustee in bankruptcy in accordance with
the final, nonappealable order of a court having competent
jurisdiction, the Paying Agent shall, at the time it provides
notice to the Bond Insurer, notify all Owners that in the
event that any Owner's payment is so recovered, such Owner
will be entitled to payment from the Bond Insurer to the
extent of such recovery, and the Paying Agent shall furnish to
the Bond Insurer its records evidencing the payments of
principal, of and interest on the Bonds which have been made by
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the Paying Agent and subsequently recovered from Owners and
the dates on which such payments were made.
The Bond Insurer shall, to the extent it makes
payment of principal of or interest on the Bonds, become
subrogated to the rights of the recipients of such payments in
accordance with the terms of the Bond Insurance Policy and, to
evidence such subrogation, in the case of subrogation as to
claims for past due interest, the Paying Agent shall note the
Bond Insurer's rights as subrogee on the registration books
maintained by the Registrar upon receipt from the Bond Insurer
of proof of the payment of interest thereon to the Owners of
such Bonds and, in the case of subrogation as to claims for
past due principal, the Paying Agent shall note the Bond
Insurer's rights as subrogee on the registration books for the
Bonds maintained by the Registrar upon receipt of proof of the
payment of principal thereof to the Owners of such Bonds.
Notwithstanding anything in this Ordinance or the Bonds to the
contrary, the Paying Agent shall make payment of such past due
interest and past due principal directly to the Bond Insurer
to the extent that the Bond Insurer is a subrogee with respect
thereto.
(3) Redemption. Bonds maturing on or before
June 1, 2003, shall not be subject to optional redemption
prior to their respective Maturity Dates. Bonds maturing on
or after December 1, 2003, shall be subject to optional
redemption prior to their respective Maturity Dates, in whole
or in part in such order as may be determined by the City, on
June 1, 2003, and on any Interest Payment Date thereafter at
a price equal to the principal amount of each Bond so redeemed
plus accrued interest thereon to the Redemption Date plus a
premium expressed as a percentage of the principal amount of
each Bond so redeemed, depending on the Redemption Date, as
follows:
Redemption Dates Premiums
June 1, 2003, and December 1, 2003 1. 0%
June 1, 2004, and December 1, 2004 0.5
June 1, 2005, and Thereafter None
Bonds maturing in the year 2006 shall also be
subject to mandatory sinking fund redemption prior to their
Maturity Date, by lot, on the dates specified below at a price
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equal to the principal amount of each Bond so redeemed plus
accrued interest thereon to the Redemption Date. Such Bonds
shall be redeemed on the following dates in the following
aggregate principal amounts:
Dates Principal Amounts
June 1, 2005 $480, 000
December 1, 2005 515, 000
June 1, 2006 505, 000
December 1, 2006 545, 000
Bonds maturing in the year 2009 shall also be
subject to mandatory sinking fund redemption prior to their
Maturity Date, by lot, on the dates specified below at a price
equal to the principal amount of each Bond so redeemed plus
accrued interest thereon to the Redemption Date. Such Bonds
shall be redeemed on the following dates in the following
aggregate principal amounts:
Dates Principal Amounts
June 11 2007 $530, 000
December 11 2007 575, 000
June 11 2008 560, 000
December 1, 2008 610, 000
June 11 2009 590, 000
December 11, 2009 640, 000
Bonds which are redeemable prior to their respective
Maturity Dates may be redeemed in part if issued in
denominations which are integral multiples of $5, 000. Such
Bonds shall be treated as representing a corresponding number
of separate Bonds in the denomination of $5, 000 each. Any
such Bond to be redeemed in part shall be surrendered for
partial redemption in the manner hereinafter provided for
transfers of ownership. Upon payment of the redemption price
of any such Bond redeemed in part the Owner thereof shall
receive a new Bond or Bonds of authorized denominations in
aggregate principal amount equal to the unredeemed portion of
the Bond surrendered.
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ram .,
Notice of redemption shall be given by the Paying
Agent in the name of the City by sending a copy thereof by
certified or registered first-class postage-prepaid mail, not
less than thirty (30) nor more than sixty (60) days prior to
the Redemption Date, to the Bond Insurer (except in the case
of mandatory sinking fund redemption) and the Owner of each of
the Bonds being redeemed determined as of the close of
business on the day preceding the first mailing of such notice
at the address appearing on the registration books of the
City. Such notice shall specify with respect to the Bonds to
be redeemed, whether in whole or in part, the numbers and the
CUSIP numbers thereof, the principal amounts and the Maturity
Dates thereof and the date fixed for redemption and shall
further state that on the Redemption Date there will be due
and payable upon each Bond or part thereof so to be redeemed
the principal amount or part thereof plus accrued interest
thereon to the Redemption Date plus any premium due and that
from and after such date interest will cease to accrue. In
addition, the Paying Agent is hereby authorized to comply with
any operational procedures and requirements of the Securities
Depository relating to redemption of Bonds and notice thereof.
Notice of optional redemption as provided herein (except any
such notice with respect to Bonds to be redeemed in connection
with an advance refunding) shall be given only if moneys on
deposit with the Paying Agent and legally available for
redemption of Bonds are sufficient therefor as of the date of
such notice. Failure to mail any notice as aforesaid or any
defect in any notice so mailed with respect to any Bond shall
not affect the validity of the redemption proceedings with
respect to any other Bond. Any Bonds redeemed prior to their
respective Maturity Dates by call for prior redemption or
otherwise shall not be reissued and shall be cancelled the
same as Bonds paid at or after maturity.
Notwithstanding any other provision of this
Ordinance to the contrary, so long as any Bond is registered
in the name of Cede & Co. , as nominee for the Securities
Depository, all notices with respect to the Bonds shall be
given in the manner provided in the Letter of Representations.
In the event of a conflict between the provisions of this
Ordinance and the Letter of Representations, the provisions of
this Ordinance shall be controlling.
(4) Interest Rates. The maximum net effective
interest rate authorized for the Bonds is 15% per annum. The
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weighted average interest rate for the Prior Bonds is 7. 0813%
per annum. The net effective interest rate for the Bonds is
5.0941% per annum.
(5) Execution and Authentication. The Bonds shall
be executed by and on behalf of the City with the facsimile or
manual signature of the Mayor, shall bear a facsimile or
manual impression of the seal of the City, shall be attested
with the facsimile or manual signature of the City Clerk,
shall be countersigned with the facsimile or manual signature
of the Financial Officer of the City, and shall be
authenticated with the manual signature of the Registrar.
Should any officer whose facsimile or manual signature appears
on the Bonds cease to be such officer before delivery of the
Bonds to the Purchaser, such facsimile or manual signature
shall nevertheless be valid and sufficient for all purposes.
No Bond shall be valid or become obligatory for any purpose or
be entitled to any security or benefit under this Ordinance
unless and until the certificate of authentication on such
Bond shall have been duly executed by the Registrar, and such
executed certificate upon any such Bond shall be conclusive
evidence that such Bond has been authenticated and delivered
under this Ordinance.
(6) Registration, Transfer and Exchange. Upon
their execution and authentication and prior to their delivery
the Bonds shall be registered for the purpose of payment of
principal and interest by the Registrar. Initially, each Bond
shall be registered in the name of the Securities Depository
or a nominee therefor. Except as hereinafter provided, all of
the Bonds shall continue to be registered in the name of the
Securities Depository or a nominee therefor. To the extent
that typewritten Bonds, rather than printed Bonds, are to be
delivered, such modifications to the form of Bond as may be
necessary or desirable in such case are hereby authorized and
approved. There shall be no substantive change to the terms
and conditions set forth in the form of Bond, except as
otherwise authorized by this Ordinance or any amendment
thereto.
Neither the City nor the Registrar shall have any
responsibility or obligation with respect to the accuracy of
the records of the Securities Depository or a nominee therefor
or any Participant regarding any ownership interest in the
Bonds or the delivery to any Participant, Beneficial Owner or
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any other Person (except an Owner of Bonds) of any notice with
respect to the Bonds.
The Bonds shall be transferable only upon the
registration books of the City by the Transfer Agent at the
request of the Owner thereof or his, her or its duly
authorized attorney-in-fact or legal representative. The
Registrar or Transfer Agent shall accept a Bond for
registration or transfer only if the Owner is to be an
individual, a corporation, a partnership, or a trust. A Bond
may be transferred upon surrender thereof together with a
written instrument of transfer duly executed by the Owner or
his, her or its duly authorized attorney-in-fact or legal
representative with guaranty of signature satisfactory to the
Transfer Agent, containing written instructions as to the
details of the transfer, along with the social security number
or federal employer identification number of the transferee
and, if the transferee is a trust, the names and social
security numbers of the settlors and the beneficiaries of the
trust. The Transfer Agent shall not be required to transfer
ownership of any Bond during the fifteen (15) days prior to
the first mailing of any notice of redemption or to transfer
ownership of any Bond selected for redemption on or after the
date of such mailing. The Owner of any Bond or Bonds may also
exchange such Bond or Bonds for another Bond or Bonds of
authorized denominations. Transfers and exchanges shall be
made without charge, except that the Transfer Agent may
require payment of a sum sufficient to defray any tax or other
governmental charge that may hereafter be imposed in
connection with any transfer or exchange of Bonds. No
transfer of any Bond shall be effective until entered on the
registration books of the City. In the case of every transfer
or exchange, the Register shall authenticate and the Transfer
Agent shall deliver to the new Owner a new Bond or Bonds of
the same aggregate principal amount, maturing in the same
year, and bearing interest at the same per annum interest rate
as the Bond or Bonds surrendered. Such Bond or Bonds shall be
dated as of their date of authentication. New Bonds delivered
upon any transfer or exchange shall be valid obligations of
the City, evidencing the same obligation as the Bonds
surrendered, shall be secured by this Ordinance, and shall be
entitled to all of the security and benefits hereof to the
same extent as the Bonds surrendered. The City may deem and
treat the Person in whose name any Bond is last registered
upon the books of the City as the absolute Owner thereof for
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the purpose of receiving payment of the Debt Service
Requirements of such Bond and for all other purposes, and all
such payments so made to such Person or upon his, her or its
order shall be valid and effective to satisfy and discharge
the liability of the City upon such Bond to the extent of the
sum or sums so paid, and the City shall not be a f f ected by any
notice to the contrary.
Neither the City nor the Transfer Agent shall have
any responsibility or obligation with respect to the accuracy
of the records of the Securities Depository or its
Participants regarding any ownership interest in the Bonds or
transfers thereof.
Upon the occurrence of an Event of Default which
would require payment by the Bond Insurer under the Bond
Insurance Policy, the Bond Insurer and its designated agents
shall be afforded access to the registration books of the
City.
(7) Resignation or Removal of Agents. If the
Paying Agent, Registrar, Transfer Agent or Escrow Bank shall
resign as such, or if the City shall reasonably determine that
the Paying Agent, Registrar, Transfer Agent or Escrow Bank has
become incapable of fulfilling its duties under this
Ordinance, the City may, upon notice mailed to the Bond
Insurer and to the Owners of the Bonds at the addresses shown
on the registration books of the City, appoint a successor
paying agent, registrar, transfer agent or escrow bank. Every
such successor paying agent, registrar, transfer agent or
escrow bank shall be a Trust Bank. It shall not be required
that the same institution serve as paying agent, registrar,
transfer agent and escrow bank, but the City shall have the
right to have the same institution serve as paying agent,
registrar, transfer agent and escrow bank. Any such
resignation or removal shall become effective only upon the
appointment of a successor.
(8) Resignation or Removal of Securities
Depository. The City may remove the Securities Depository and
the Securities Depository may resign by giving sixty (60)
days' written notice to the other of such removal or
resignation. Additionally, the Securities Depository shall be
removed sixty (60) days after receipt by the City of written
notice from the Securities Depository to the effect that the
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,..
Securities Depository has received written notice from
Participants having interests, as shown in the records of the
Securities Depository, in an aggregate principal amount of not
.less than fifty percent (50%) of the aggregate principal
amount of the then Outstanding Bonds to the effect that the
Securities Depository is unable or unwilling to discharge its
responsibilities or a. continuation of the requirement that all
of the Outstanding Bonds be registered in the name of the
Securities Depository or a nominee therefor is not in the best
interests of the Beneficial Owners. Upon the removal or
resignation of the Securities Depository, the Securities
Depository shall take such action as may be necessary to
assure the orderly transfer of the computerized book-entry
system with respect to the Bonds to a successor securities
depository or, if no successor securities depository is
appointed as herein provided, the transfer of the Bonds in
certificate form to the Beneficial Owners or their designees.
Upon the giving of notice by the City of the removal of the
Securities Depository, the giving of notice by the Securities
Depository of its resignation or the receipt by the City of
notice with respect to the written notice of Participants
referred to herein, the City may, within sixty (60) days after
the giving of such notice, appoint a successor securities
depository upon such terms and conditions as the City shall
impose. Any such successor securities depository shall at all
times be a registered clearing agency under the Securities and
Exchange Act of 1934, as amended, or other applicable statute
or regulation, and in good standing thereunder. If the City
fails to appoint a successor securities depository within such
time period, the Bonds shall no longer be restricted to being
registered in the name of the Securities Depository or a
nominee therefor, but may be registered in whatever name or
names Owners transferring or exchanging Bonds shall designate.
(9) Replacement of Bonds. If any Bond shall have
been lost, destroyed or wrongfully taken, the City shall
provide for the replacement thereof in the manner set forth
and upon receipt of the evidence, indemnity bond and
reimbursement for expenses provided in Sec. 8-41 of the Code.
(10) Recitals in Bonds. Each Bond shall recite in
substance that the Bond is payable solely from the Pledged
Revenues and that the Bond is not payable in whole or in part
from ad valorem taxes of the City and that the full faith and
credit of the City is not pledged to pay the principal of or
24
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interest on such Bond. Each Bond shall further recite that it
is issued under the authority of the State Constitution, the
Charter, the Act and this Ordinance. The Act provides that
such recital conclusively imparts full compliance with all of
the provisions and limitations thereof and that the Bonds
containing such recital are incontestable for any cause
whatsoever after their delivery for value.
(11) Form of Bonds. The Bonds shall be in
substantially the following form:
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(Form of Bond]
(Text of Face)
UNITED STATES OF AMERICA
STATE OF COLORADO COUNTY OF LARIMER
CITY OF FORT COLLINS
SALES AND USE TAX REVENUE REFUNDING BOND
SERIES 1993
No. R- $
Interest Maturity Original
Rate Date Date CUSIP
10, June 1, 1993
REGISTERED OWNER: Cede & Co.
PRINCIPAL SUM:
The City of Fort Collins, in the County of Larimer and
State of Colorado, for value received, hereby promises to pay to
the Registered Owner (specified above) , or registered assigns,
solely from the special funds provided therefor, as hereinafter set
forth, the Principal Sum (specified above) , in lawful money of the
United States of America, on the Maturity Date (specified above) ,
with interest thereon from the Original Date (specified above) , or
the interest payment date to which interest has been paid next
preceding the date hereof, whichever is later, to the Maturity
Date, except if redeemed prior thereto, at the per annum Interest
Rate (specified above) , payable semiannually on the first day of
June and the first day of December of each year, commencing on
December 1, 1993, or the first such date after the date hereof,
whichever is later, in the manner provided herein. If upon
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1 I
presentation at maturity payment of the Principal Sum is not made
as provided herein, interest continues at the Interest Rate until
the Principal Sum is paid in full.
Bonds maturing or on before June 1, 2003, are not subject
to optional redemption prior to their respective maturity dates.
Bonds maturing on or after December 1, 2003 , are subject to
optional redemption prior to their respective maturity dates, in
whole or in part in such order as may be determined by the City, on
June 1, 2003, and on any interest payment date thereafter at a
price equal to the principal amount of each Bond so redeemed plus
accrued interest thereon to the redemption date plus a premium
expressed as a percentage of the principal amount of each Bond so
redeemed, depending on the redemption date, as follows:
Redemption Dates Premiums
June 1, 2003 , and December 1, 2003 1. 0%
June 1, 2004, and December 11 2004 0.5
June 1, 2005, and Thereafter None
Bonds maturing in the year 2006 are also subject to
mandatory sinking fund redemption prior to their maturity date, by
lot, on the dates specified below at a price equal to the principal
amount of each Bond so redeemed plus accrued interest thereon to
the redemption date. Such Bonds are to be redeemed on the
following dates in the following aggregate principal amounts:
Dates Principal Amounts
June 1, 2005 $480, 000
December 1, 2005 515, 000
June 1, 2006 505, 000
December 1, 2006 545, 000
Bonds maturing in the year 2009 are also subject to
mandatory sinking fund redemption prior to their maturity date, by
lot, on the dates specified below at a price equal to the principal
amount of each Bond so redeemed plus accrued interest thereon to
the redemption date. Such Bonds are to be redeemed on the
following dates in the following aggregate principal amounts:
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Dates Principal Amounts
June 11 2007 $530, 000
December 11 2007 575,000
June 11 2008 560, 000
December 11 2008 610, 000
June 11 2009 590, 000
December 11 2009 640, 000
Bonds which are redeemable prior to their respective
maturity dates may be redeemed in part if issued in denominations
which are integral multiples of $5, 000. In such case the Bond is
to be surrendered in the manner provided for transfers of
ownership. Upon payment of the redemption price the registered
owner is to receive a new Bond or Bonds of authorized denominations
in aggregate principal amount equal to the unredeemed portion of
the Bond surrendered.
Notice of redemption of any Bonds is to be given by the
paying agent in the name of the City by sending a copy of such
notice by certified or registered first-class postage-prepaid mail,
not less than thirty (3 0) nor more than sixty (60) days prior to
the redemption date, to Financial Guaranty Insurance Company
(except in the case of mandatory sinking fund redemption) and to
the registered owner of each of the Bonds being redeemed determined
as of the close of business on the day preceding the first mailing
of such notice at the address appearing on the registration books
of the City. Such notice is to specify with respect to the Bonds
to be redeemed, whether in whole or in part, the numbers and the
CUSIP numbers thereof, the principal amounts and the maturity dates
thereof and the date fixed for redemption and is further to state
that on the redemption date there will be due and payable upon each
Bond or part thereof so to be redeemed the principal amount or part
thereof plus accrued interest thereon to the redemption date plus
any premium due and that from and after such date interest will
cease to accrue. In addition, the paying agent is authorized to
comply with any operational procedures and requirements of The
Depository Trust Company relating to redemption of Bonds and notice
thereof. Notice of optional redemption as provided herein (except
any such notice with respect to Bonds to be redeemed in connection
with any advance refunding) is to be given only if moneys on
deposit with the paying agent and legally available for redemption
of Bonds are sufficient therefor as of the date of such notice.
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Failure to mail any notice as aforesaid or any defect in any notice
so mailed with respect to any Bond does not affect the validity of
the redemption proceedings with respect to any other Bond.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF
THIS BOND SET FORTH ON THE REVERSE HEREOF.
This Bond is a special and limited obligation of the City
payable solely out of and secured by an irrevocable assignment and
pledge (but not necessarily an exclusive assignment and pledge) of
the Pledged Revenues, as more specifically provided in the
Ordinance. This Bond does not constitute a debt or an indebtedness
of the City within the meaning of any constitutional, statutory or
City charter provision or limitation of the State of Colorado or of
the City. This Bond is not payable in whole or in part from ad
valorem taxes of the City, and the full faith and credit of the
City is not pledged for the payment of the principal of or interest
on this Bond.
IN WITNESS WHEREOF, the City has caused this Bond to be
executed in its name and on its behalf with the facsimile or manual
signature of the Mayor of the City, to be sealed with a facsimile
or manual impression of the seal of the City, to be attested with
the facsimile or manual signature of the City Clerk of the City,
and to be countersigned with the facsimile or manual signature of
the Financial Officer of the City.
CITY OF FORT COLLINS, COLORADO
(CITY) By: (Facsimile or Manual Signature)
(SEAL) Mayor
ATTEST:
(Facsimile or Manual Signature)
City Clerk
Countersigned:
(Facsimile or Manual Signature)
Financial Officer
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CERTIFICATE OF AUTHENTICATION
This Bond is issued pursuant to the Ordinance herein described.
Printed on the reverse hereof is the complete text of the opinion
of bond counsel, Ballard Spahr Andrews & Ingersoll, Denver,
Colorado, a signed copy of which, dated the date of the f irst
delivery of the Bonds herein described, is on file with the
undersigned.
COLORADO NATIONAL BANK
as registrar
By: Manual Signature)
Authorized Officer
Dated:
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ABBREVIATIONS
The following abbreviations, when used in the inscription
on the face of this Bond, shall be construed as though they were
written out in full according to applicable laws or regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with the right of
survivorship and not as tenants
in common
UNIF TRANS MIN ACT - Custodian
(Cust) Minor)
under Uniform Transfers to Minors Act
(State)
Additional abbreviations may also be used
though not on the above list.
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(Text of Reverse)
The principal of, interest on and any premium due in
connection with the redemption of this Bond are payable to the
Registered Owner by Colorado National Bank, Denver, Colorado, or
its successors, as paying agent. The principal and the final
installment of interest are payable to the Registered Owner upon
presentation and surrender of this Bond at maturity or upon prior
redemption, by check or draft mailed to the Registered Owner at the
address appearing on the registration books of the City maintained
by Colorado National Bank, Denver, Colorado, or its successors, as
registrar, or by wire transfer to such bank or other depository as
the Registered Owner shall designate in writing to the paying
agent. Except as hereinbefore and hereinafter provided, the
interest is payable to the Registered Owner determined as of the
close of business on the regular record date, which is the
fifteenth day of the calendar month next preceding the interest
payment date, irrespective of any transfer of ownership hereof
subsequent to the regular record date and prior to such interest
payment date, by check or draft or wire transfer directed to the
Registered Owner as aforesaid. Any interest hereon not paid when
due and any interest hereon accruing after maturity is payable to
the Registered Owner determined as of the close of business on the
special record date, which is to be fixed by the paying agent for
such purpose, irrespective of any transfer of ownership of this
Bond subsequent to such special record date and prior to the date
fixed by the paying agent for the payment of such interest, by
check or draft or wire transfer directed to the Registered Owner as
aforesaid. Notice of the special record date and of the date fixed
for the payment of such interest is to be given by sending a copy
thereof by certified or registered first-class postage-prepaid
mail, at least fifteen (15) days prior to the special record date,
to the registered owner of each Bond upon which interest will be
paid determined as of the close of business on the day preceding
such mailing, at the address appearing on the registration books of
the City. Any premium is payable to the Registered Owner upon
presentation and surrender of this Bond upon prior redemption, by
check or draft or wire transfer directed to the Registered Owner as
aforesaid. If the date for making or giving any payment,
determination or notice described herein is a Saturday, Sunday,
legal holiday or any other day on which the office of the paying
agent or registrar is authorized or required by law to remain
closed, such payment, determination or notice is to be made or
given on the next succeeding day which is not a Saturday, Sunday,
32
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legal holiday or other day on which the office of the paying agent
or registrar is authorized or required by law to remain closed.
So long as the Registered Owner is the securities
depository or a nominee therefor, the securities depository is to
disburse any payments received, through its participants or
otherwise, to the beneficial owner or owners hereof.
Neither the City nor the paying agent has any
responsibility or obligation for the payment to any participant,
any beneficial owner hereof or any other person or entity (except
the Registered Owner) of the principal of, interest on or any
premium due in connection with the redemption of this Bond.
Neither the City nor the registrar has any responsibility
or obligation with respect to the accuracy of the records of the
securities depository or a nominee therefor or any participant with
respect to any ownership interest in the Bonds or the delivery to
any participant, beneficial owner or any other person or entity
(except the Registered Owner) of any notice with respect to the
Bonds.
Payment of the principal of, interest on and any premium
due in connection with the redemption of this Bond is to be made
solely from, and as security for such payment there are irrevocably
(but not necessarily exclusively) pledged, pursuant to the
Ordinance authorizing the issuance of this Bond, two special funds
identified as the "City of Fort Collins, Colorado, Sales and Use
Tax Revenue Bonds, Principal and Interest Account" and the "City of
Fort Collins, Colorado, Sales and Use Tax Revenue Bonds, Reserve
Account, " into which funds the City has covenanted in the Ordinance
to pay from Pledged Revenues consisting of net receipts from the
City's sales and use tax and certain other revenues sums sufficient
to pay when due the principal of, interest on and any premium due
in connection with the redemption of the Bonds and any other parity
securities payable therefrom and to accumulate and maintain a
specified reserve for such purposes.
It is hereby recited, certified and warranted that for
the payment of the principal of, interest on and any premium due in
connection with the redemption of this Bond the City has created
and will maintain said special funds and will deposit the Pledged
Revenues therein out of the amounts and revenues specified in the
Ordinance and out of said special funds, as an irrevocable charge
thereon, will pay the principal of, interest on and any premium due
33
in connection with the redemption of this Bond in the manner
provided by the Ordinance.
The Bonds are equitably and ratably secured by a lien on
the Pledged Revenues, and such Bonds constitute an irrevocable and
first lien (but not necessarily an exclusive first lien) upon the
Pledged Revenues. . Bonds and other types of securities, in addition
to the Bonds, .subject to expressed conditions, may be issued and
made payable from the Pledged Revenues having a lien thereon
subordinate and junior to the lien of the Bonds or, subject to
additional expressed conditions, having a lien thereon on a parity
with the lien of such Bonds in accordance with the provisions of
the Ordinance. Except as otherwise expressly provided in this Bond
and the Ordinance, the Pledged Revenues are assigned, pledged and
set aside to the payment of the principal of and interest on the
Bonds in anticipation of the collection of the Pledged Revenues.
The City covenants and agrees with the Registered Owner
that it will keep and will perform all of the covenants of this
Bond and of the Ordinance.
This Bond is authorized and issued for the purpose of
refunding, paying and discharging and refinancing at a lower
interest rate certain outstanding sales and use tax revenue
refunding and improvement bonds of the City pursuant to, by virtue
of and in full conformity with the Constitution of the State of
Colorado, the City Charter, part 1 of article 56 of title 11,
Colorado Revised Statutes, as amended, and all other laws of the
State of Colorado thereunto enabling, and pursuant to the Ordinance
duly adopted prior to the issuance of this Bond. The foregoing
recital conclusively imparts full compliance with all of the
provisions and limitations of the above-cited statute, and said
statute provides that this Bond is incontestable for any cause
whatsoever after its delivery for value.
Reference is hereby made to the Ordinance, and to any and
all modifications and amendments thereof, for a description of the
provisions, terms and conditions upon which the Bonds are issued
and secured, including, without limitation, the nature and extent
of the security for the Bonds, provisions with respect to the
custody and application of the proceeds of the Bonds, the
collection and disposition of the revenues and moneys charged with
and pledged to the payment of the principal of, interest on and any
premium due in connection with the redemption of the Bonds, the
terms and conditions on which the Bonds are issued, a description
34
of the special funds referred to above and the nature and extent of
the security and pledge afforded thereby for the payment of the
principal of, interest on and any premium due in connection with
the redemption of the Bonds, and the manner of enforcement of said
pledge, as well as the rights, duties, immunities and obligations
of the City and the members of its Council and also the rights and
remedies of the registered owners of the Bonds.
To the extent and in the respects permitted by the
Ordinance, the provisions of the Ordinance, or any instrument
amendatory thereof or supplemental thereto, may be modified or
amended by action of the City taken in the manner and subject to
the conditions and exceptions provided in the Ordinance. The
pledge of revenues and other obligations of the City under the
Ordinance may be discharged at or prior to the maturity or prior
redemption of the Bonds upon the making of provision for the
payment of the Bonds on the terms and conditions set forth in the
Ordinance.
It is hereby recited, certified and warranted that all
the requirements of law have been fully complied with by the proper
officers of the City in the issuance of this Bond; that it is
issued pursuant to and in strict conformity with the Constitution
and all other laws of the State of Colorado, including the City
Charter, and with the Ordinance; that this Bond does not contravene
any constitutional or statutory limitation of the State of Colorado
or any limitation of the City Charter; and that this Bond is issued
under the authority of the Ordinance.
For the payment of the principal of, interest on and any
premium due in connection with the redemption of this Bond the City
pledges the exercise of all its lawful corporate powers.
This Bond is transferable only upon the registration
books of the City by Colorado National Bank, Denver, Colorado, or
its successors, as transfer agent, at the request of the Registered
Owner or his, her or its duly authorized attorney-in-fact or legal
representative, upon surrender hereof together with a written
instrument of transfer duly executed by the Registered Owner or
his, her or its duly authorized attorney-in-fact or legal
representative with guaranty of signature satisfactory to the
transfer agent, containing written instructions as to the details
of the transfer, along with the social security number or federal
employer identification number of the transferee and, if the
transferee is a trust, the names and social security numbers of the
35
settlors and the beneficiaries of the trust. The transfer agent is
not required to transfer ownership of this Bond during the f if teen
(15) days prior to the first mailing of any notice of redemption or
to transfer ownership of any Bond selected for redemption on or
after the date of such mailing. The Registered Owner may also
exchange this Bond for another Bond or Bonds of authorized
denominations. Transfers and exchanges are to be made without
charge, except that the transfer agent may require payment of a sum
sufficient to defray any tax or other governmental charge that may
hereafter be imposed in connection with any transfer or exchange of
Bonds. No transfer of this Bond is to be effective until entered
on the registration books of the City. In the case of every
transfer or exchange, the registrar is to authenticate and the
transfer agent is to deliver to the new registered owner a new Bond
or Bonds of the same aggregate principal amount, maturing in the
same year, and bearing interest at the same per annum interest rate
as the Bond or Bonds surrendered. Such Bond or Bonds are to be
dated as of their date of authentication. The City may deem and
treat the person or entity in whose name this Bond is last
registered upon the books of the City as the absolute owner hereof
for the purpose of receiving payment of the principal of, interest
on and any premium due in connection with the redemption of this
Bond and for all other purposes, and all such payments so made to
such person or entity or upon his, her or its order will be valid
and effective to satisfy and discharge the liability of the City
upon this Bond to the extent of the sum or sums so paid, and the
City will not be affected by any notice to the contrary.
Neither the City nor the transfer agent has any
responsibility or obligation with respect to the accuracy of the
records of the securities depository or its participants regarding
any ownership interest in the Bonds or transfers thereof.
The City may remove the securities depository and the
securities depository may resign by giving sixty (60) days' written
notice to the other of such removal or resignation. Additionally,
the securities depository is to be removed sixty (60) days after
receipt by the City of written notice from the securities
depository to the effect that the securities depository has
received written notice from participants having interests, as
shown in the records of the securities depository, in an aggregate
principal amount of not less than fifty percent (50%) of the
aggregate principal amount of the then outstanding Bonds to the
effect that the securities depository is unable or unwilling to
discharge its responsibilities or a continuation of the requirement
36
that all of the outstanding Bonds be registered in the name of the
securities depository or a nominee therefor is not in the best
interests of the beneficial owners. Upon the removal or
resignation of the securities depository, the securities depository
is to take such action as may be necessary to assure the orderly
transfer of the computerized book-entry system with respect to the
Bonds to a successor securities depository or, if no successor
securities depository is appointed as herein provided, the transfer
of the Bonds in certificate form to the beneficial owners or their
designees. Upon the giving of notice by the City of the removal of
the securities depository, the giving of notice by the securities
depository of its resignation or the receipt by the City of notice
with respect to the written notice by participants referred to
herein, the City may, within sixty (60) days after the giving of
such notice, appoint a successor securities depository upon such
terms and conditions as the City shall impose. Any such successor
securities depository must at all times be a registered clearing
agency under the Securities and Exchange Act of 1934, as amended,
or other applicable statute or regulation and in good standing
thereunder. If the City fails to appoint a successor securities
depository within such time period, the Bonds are no longer to be
restricted to being registered in the name of the securities
depository or a nominee therefor, but may be registered in whatever
name or names registered owners transferring or exchanging Bonds
shall designate.
37
STATEMENT OF INSURANCE
Financial Guaranty Insurance Company ("Financial
Guaranty") has issued a policy containing the following provisions
with respect to the City of Fort Collins, Colorado, Sales and Use
Tax Revenue Refunding Bonds, Series 1993 (the "Bonds") , such policy
being on file at the principal office of Colorado National Bank, or
its successors, as paying agent (the "Paying Agent") :
Financial Guaranty hereby unconditionally and irrevocably
agrees to pay for disbursement to the Bondholders that portion of
the principal of and interest on the Bonds which is then due for
payment and which the City of Fort Collins, Colorado (the "City") ,
shall have failed to provide. Due for payment means, with respect
to the principal, the stated maturity date thereof, or the date on
which the same shall have been duly called for mandatory sinking
fund redemption and does not refer to any earlier date on which the
payment of principal of the Bonds is due by reason of call for
redemption (other than mandatory sinking fund redemption) ,
acceleration or other advancement of maturity, and with respect to
interest, the stated date for payment of such interest.
Upon receipt of telephonic or telegraphic notice,
subsequently confirmed in writing, or written notice by registered
or certified mail, from a Bondholder or the Paying . Agent to
Financial Guaranty that the required payment of principal or
interest has not been made by the City to the Paying Agent,
Financial Guaranty on the due date of such payment or within one
business day after receipt of notice of such nonpayment, whichever
is later, will make a deposit of funds in an account with Citibank,
N.A. , or its successors, as its agent (the "Fiscal Agent") ,
sufficient to make the portion of such payment not paid by the
City. Upon presentation to the Fiscal Agent of evidence
satisfactory to it of the Bondholder's right to receive such
payment and any appropriate instruments of assignment required to
vest all of such Bondholder's right to such payment in Financial
Guaranty, the Fiscal Agent will disburse such amount to the
Bondholder.
As used herein the term "Bondholder" means the person
other than the City who at the time of nonpayment of a Bond is
entitled under the terms of such Bond to payment thereof.
The policy is non-cancellable for any reason.
FINANCIAL GUARANTY INSURANCE COMPANY
38
(Assignment)
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Name and Address of Assignee)
this Bond and does hereby irrevocably constitute and appoint
, or its successors,
to transfer this Bond on the books kept for registration thereof.
Dated:
Signature guaranteed:
(Eligible Guarantor Institution)
NOTICE: The signature to this
assignment must correspond with
the name of the Registered
Owner as it appears upon the
face of this Bond in every
particular without alteration
or enlargement or any change
whatever.
(End of Form of Bond]
39
C. Bonds Equally Secured. The covenants and agreements
herein set forth to be performed on behalf of the City shall be for
the equal benefit, protection and security of the Owners of the
Bonds, all of which, regardless of the time or times of their
maturity, shall be of equal rank without preference, priority or
distinction of any of the Bonds over any other thereof, except as
otherwise expressly provided in or pursuant to this Ordinance.
D. Special Obligations. All of the Bonds, as to all
Debt Service Requirements thereof, shall be payable solely out of
the Pledged Revenues. The Owners of the Bonds may not look to the
general or any other fund of the City for the payment of the Debt
Service Requirements thereof, except the special funds pledged
therefor, and the Bonds shall not be considered or held to be
general obligations of the City but shall constitute special and
limited obligations of the City. The Bonds are not payable in
whole -or in part from ad valorem taxes of the City, and the full
faith and credit of the City is not pledged for payment of the
Bonds.
Section 4. Sale of Bonds.
A. Purchaser's Proposal. The Purchaser has submitted
a proposal for the purchase of the Bonds, together with the
disclosures, comparisons and other information required by the Act,
and the Financial Officer of the City has recommended that said
proposal be accepted by the Council.
B. Award of Contract; Execution of Bond Purchase
Agreement. The contract for the purchase of the Bonds is hereby
awarded to the Purchaser at the price specified in the Purchaser's
proposal and upon the terms set forth in this Ordinance. The City
Manager is hereby authorized to execute the Bond Purchase Agreement
on behalf of the City immediately following the marketing of the
Bonds, subject to ratification by the Council by final adoption of
this Ordinance.
C. Approval of Preliminary Official Statement. The
Council hereby approves .the Preliminary Official Statement and
ratifies the use and distribution thereof by the Purchaser in
marketing the Bonds.
D. Delivery. After the Bonds have been duly executed,
authenticated and registered as provided herein, the Financial
40
Officer of the City shall cause the Bonds to be delivered to the
Purchaser upon receipt of the agreed purchase price.
Section 5. Disposition of Bond Proceeds and Pledged
Revenues; Funds and Accounts Adopted or Created by Ordinance;
Security For Bonds. The proceeds of the sale of the Bonds and the
Pledged Revenues received by the City shall be deposited by the
City in the funds described in this Section 5, to be accounted for
in the manner and priority set forth in this Section 5.
Neither the Purchaser nor any subsequent Owner of any
Bond shall be responsible for the application or disposal by the
City or by any of its officers, agents and employees of the moneys
derived from the sale of the Bonds or of any other moneys
designated in this Section 5.
The Pledged Revenues and all moneys and securities paid
or to be paid to or held or to be held in any fund or account
hereunder (except the Escrow Account and the Excess Investment
Earnings Account) are hereby assigned and pledged to secure the
payment of the Debt Service Requirements of the Bonds and any other
Parity Securities. This assignment and pledge shall be valid and
binding from and after the date of the first delivery of the Bonds,
and the moneys, as received by the City and hereby assigned and
pledged, shall immediately be subject to the lien of this
assignment and pledge without any physical delivery thereof, any
filing, or further act. The lien of this assignment and pledge and
the obligation to perform the contractual provisions hereby made
shall have priority over any or all other obligations and
liabilities of the City (except as herein otherwise expressly
provided) , and the lien of this assignment and pledge shall be
valid and binding as against all parties having claims of any kind
in tort, contract or otherwise against the City (except as herein
otherwise expressly provided) , irrespective of whether such parties
have notice thereof.
A. Escrow Account; Redemption of Prior Bonds; Notice of
Refunding and Redemption of Prior Bonds. The City shall deposit in
a separate special fund and trust account hereby created and
designated as the "City of Fort Collins, Colorado, Sales and Use
Tax Revenue Refunding Bonds, Series 1993, Escrow Account, "
forthwith upon receipt of the proceeds of the Bonds, proceeds of
the Bonds in the approximate amount of $25, 629,901.26 to be used
only as provided in this Section 5A. The City shall apply said sum
to the purchase of the Federal Securities in which the moneys in
41
the Escrow Account are to be invested and the funding of any
required cash balance as provided in the Escrow Agreement and in
accordance with the proposal submitted by the Purchaser. The
Escrow Account shall be maintained in an amount at the time of the
deposit therein, and at all times subsequently, at least
sufficient, together with the known minimum yield to be derived
from the investment of the deposit therein or any part thereof in
Federal Securities, to pay the principal of, interest on and any
premium due in connection with the redemption of the Prior Bonds as
the same become due. Moneys shall be withdrawn by the Escrow Bank
from the Escrow Account in sufficient amounts and at times to
permit the payment of the principal of, interest on and any premium
due in connection with the redemption of the Prior Bonds at each
payment date. Any moneys remaining in the Escrow Account after
provision has been made for the payment of the Prior Bonds may be
applied to any lawful purpose of the City. If for any reason the
amount in the Escrow Account shall at any time be insufficient for
the purposes hereinbefore set forth, the City shall forthwith from
the first Pledged Revenues available therefor deposit therein such
additional moneys as shall be necessary to permit the payment in
full of the principal of, interest on and any premium due in
connection with the redemption of the Prior Bonds as herein
provided.
The City hereby exercises its option to redeem the Prior
Bonds maturing in the year 1997 and thereafter, prior to their
respective Maturity Dates, on December 1, 1996, at a price equal to
the principal amount of each such Prior Bond so redeemed plus
accrued interest thereon to the Redemption Date plus a premium
equal to 2 . 0% of the principal amount of each such Prior Bond so
redeemed.
The Financial Officer of the City is hereby authorized
and directed to give forthwith and again not later than October 31,
1996, notice of refunding and redemption of the Prior Bonds. The
notice of refunding and redemption of the Prior Bonds shall be
given by sending a copy of such notice by certified or registered
first-class postage-prepaid mail to Kemper Securities Group, Inc. ,
Denver, Colorado, and to the Owners of the Prior Bonds determined
as of the close of business on the day preceding the first mailing
of such notice at the addresses appearing on the registration books
of the City. The notice of refunding and redemption of the Prior
Bonds shall be in substantially the following form:
42
i
(Form of Notice]
NOTICE OF REFUNDING AND REDEMPTION
OF
CITY OF FORT COLLINS, COLORADO
SALES AND USE TAX REVENUE REFUNDING AND IMPROVEMENT BONDS
SERIES 1986 .
DATED AUGUST 1, 1986 - $30, 060, 000
NOTICE IS HEREBY GIVEN to the registered owners of all
outstanding City of Fort Collins, Colorado, Sales and Use Tax
Revenue Refunding and Improvement Bonds, Series 1986, dated
August 1, 1986, in the original aggregate principal amount of
$30, 060, 000 (the "Prior Bonds")- that the City of Fort Collins,
Colorado (the "City") , has issued- Sales and Use Tax Revenue
Refunding Bonds, Series 1993, dated June 1, 1993, in the aggregate
principal amount of $26,210, 000, and deposited a portion of the
proceeds thereof in escrow with Colorado National Bank, Denver,
Colorado, which proceeds have been invested in bills, certificates
of indebtedness, notes, bonds or similar securities which are
direct obligations of, or the principal and interest of which
obligations are unconditionally guaranteed by, the United States of
America for the payment of the principal of, interest on and any
premium due in connection with the redemption of the Prior Bonds as
the same become due.
According to a report pertaining to such escrow prepared
by a firm of certified public accountants licensed to practice in
Colorado, the escrow, including the known minimum yield from such
investments, is fully sufficient at the time of the deposit and at
all times subsequently to pay the principal of, interest on and any
premium due in connection with the redemption of the Prior Bonds as
such payments become due.
NOTICE IS FURTHER HEREBY GIVEN that the City has
exercised its option to redeem the Prior Bonds maturing in the year
1997 and thereafter, which are numbered , prior to their
respective maturity dates, on December 1, 1996, at a price equal to
the principal amount of each such Prior Bond so redeemed plus
accrued interest thereon to the redemption date plus a premium
equal to 2. 0% of the principal amount of each such Prior Bond so
redeemed.
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On the redemption date there will become due and payable
at the office of the Financial Officer of the City in Fort Collins,
Colorado, the principal amount of each such Prior Bond so redeemed
plus accrued interest thereon to the redemption date plus a premium
equal to 2 . 0% of the principal amount of each such Prior Bond so
redeemed, and from and after the redemption date interest will
cease to accrue. Each such Prior Bond will be redeemed on or after
the redemption date upon presentation and surrender thereof.
GIVEN BY ORDER OF THE CITY COUNCIL this day of
19 .
CITY OF FORT COLLINS, COLORADO
Financial Officer
[End of Form of Notice]
44
,�+, �..
B. Sales and Use Tax Fund. For so long as any of the
Bonds shall be Outstanding, as to any Debt Service Requirements,
except as otherwise provided herein, the entire Pledged Revenues,
upon their receipt from time to time by the City, shall be set
aside and credited immediately to a separate special fund
heretofore created and designated as the "City of Fort Collins,
Colorado, Sales and Use Tax Fund. "
For so long as any of the Bonds shall be Outstanding as
to any Debt Service Requirements, the Sales and Use Tax Fund shall
be accumulated and administered, and the moneys on deposit therein
shall be applied, in the following order of priority:
(1) First, to the Principal and Interest Account to
pay any Debt Service Requirements of the Bonds, any Additional
Parity Bonds and any other Parity Securities then Outstanding
in the manner set forth in Section 5C hereof;
(2) Second, to the Reserve Account, in the manner
set forth in Section 5D hereof;
(3) Third, to the payment of Debt Service
Requirements of Subordinate Bonds or other Subordinate
Securities in accordance with Section 5F hereof; and
(4) Fourth, to be used in accordance with
Section 5G hereof.
C. Principal and Interest Account. The City shall
deposit in a separate special fund heretofore created as a
restricted account within the Sales and Use Tax Fund and designated
as the "City of Fort Collins, Colorado, Sales and Use Tax Revenue
Bonds, Principal and Interest Account" forthwith upon receipt of
the proceeds of the Bonds, interest accrued thereon from their date
of issue to the date of delivery thereof to the Purchaser, to apply
to the payment of interest first due on the Bonds.
The City shall deposit in the Principal and Interest
Account from the Pledged Revenues on the date of issue of the Bonds
and on or before the last day of each month beginning July, 1993,
and ending October, 1993 , and on or before the twenty-fifth day of
November, 1993, the following amounts (with credits for amounts on
deposit in the Principal and Interest Account on account of the
Prior Bonds and the amount of any accrued interest on the Bonds
deposited in the Principal and Interest Account and not theretofore
45
credited) and on or before the last day of each month beginning in
December, 1993 (except for the months of May and November, in which
months the deposits shall be made on the twenty-fifth day of the
month) , the following amounts:
(1) Interest Payments. One-sixth (1/6) of the
aggregate amount of the next installment of interest due on
the next Interest Payment Date in the then-current Bond Year
plus any other amounts due for interest on the Bonds, any
Additional Parity Bonds and any other Parity Securities then
Outstanding.
(2) Principal Payments. One-sixth (1/6) of the
aggregate amount of the next installment of principal due on
the next principal payment date in the then-current Bond Year
plus any other amounts due for principal of the Bonds, any
Additional Parity Bonds and any other Parity Securities then
Outstanding.
Such interest and principal shall be promptly paid when
due.
The moneys credited to the Principal and Interest Account
shall be used to pay the Debt Service Requirements of the Bonds,
any Additional Parity Bonds and any other Parity Securities then
Outstanding, as such Debt Service Requirements become due, except
as otherwise provided in this Ordinance.
The Principal and Interest Account shall be maintained as
a sinking fund for the mandatory redemption of Bonds maturing in
the years 2006 and 2009. Any mandatory sinking fund redemption
shall be treated as an installment of principal for purposes of
this Section 5C.
Nothing herein shall be construed so as to prevent the
City from creating separate subaccounts within the Principal and
Interest Account for the Bonds and any Additional Parity Bonds and
accounting separately for any deposits made thereto on account of
the Bonds and any Additional Parity Bonds or from creating separate
principal and interest accounts for Additional Parity Bonds, if
such action is deemed by the City to be necessary or desirable in
order to comply with any statute or regulation governing the
exclusion from gross income for federal income tax purposes of
interest on any such Additional Parity Bonds, provided that any
such separate subaccounts shall have claims to the Pledged Revenues
46
i
equal to and on a parity with those of the other such subaccounts
and any such separate principal and interest account shall have a
claim to the Pledged Revenues equal to and on a parity with that of
the Principal and Interest Account.
D. Reserve Account. The City shall retain in a
separate special fund heretofore created as a restricted account
within the Sales and Use Tax Fund and designated as the "City of
Fort Collins, Colorado, Sales and Use Tax Revenue Bonds, Reserve
Account, " an amount equal to the Average Annual Debt Service on the
Bonds. Subject to the payments required by Section 5C hereof,
except as provided in Section 5E hereof, from and to the extent of
any moneys remaining in the Sales and Use Tax Fund, there shall be
credited as hereinafter provided and from time to time thereafter
to the Reserve Account moneys sufficient to accumulate in and
maintain the Reserve Account at an amount at least equal to the
Combined Average Annual Debt Service Requirements of all
Outstanding Bonds, Additional Parity Bonds and other Parity
Securities for which the Reserve Account is maintained. For
purposes of this Section 5D, the Debt Service Requirements of any
Additional Parity Bonds and other Parity Securities bearing
interest at a variable or adjustable rate shall be computed on the
following assumptions: If interest on such Additional Parity Bonds
or other Parity Securities is excludible from gross income for
federal income tax purposes under the Tax Code, such Additional
Parity Bonds or other Parity Securities shall be assumed to bear
interest at a rate equal to one-half percent (0. 5%) over the most
recently published Bond Buyer 25 Revenue Bond Index (or if no
longer published, a comparable index) . If interest on such
Additional Parity Bonds or other Parity Securities is not
excludible from gross income for federal income tax purposes under
the Tax Code, such Additional Parity Bonds or other Parity
Securities shall be assumed to bear interest at a rate equal to
one-half percent (0.5%) over U.S. Treasury obligations of
comparable maturities.
Said amount shall be maintained as a continuing reserve
for the payment of the Debt Service Requirements of the Bonds, any
Additional Parity Bonds and any other Parity Securities for which
the Reserve Account is maintained. No payment need be made into
the Reserve Account so long as the moneys therein shall equal not
less than said amount. In the event that the amount of the Reserve
Account falls below the minimum amount required to be maintained
therein, the City shall credit to the Reserve Account that sum of
money needed to accumulate or reaccumulate the amount therein so
47
that at all times the amount of the Reserve Account equals said
minimum amount. The moneys in the Reserve Account shall be set
aside, accumulated, and, if necessary, reaccumulated as provided
herein, from time to time, and maintained as a continuing reserve
to be used, except as hereinafter provided in Section 5E and
Section 9 hereof, only to prevent deficiencies in the Principal and
Interest Account resulting from failure to deposit therein
suf f icient sums to pay such Debt Service Requirements of the Bonds,
any Additional Parity Bonds and any other Parity Securities for
which the Reserve Account is maintained as the same become due.
If at any time the City shall for any reason fail to pay
into the Principal and Interest Account the full amount above
stipulated, then an amount shall be paid into the Principal and
Interest Account at such time from the Reserve Account equal to the
difference between that paid from the Pledged Revenues in the Sales
and Use Tax Fund and the full amount so stipulated. The money so
used shall be replaced to the Reserve Account from the first moneys
credited to the Sales and Use Tax Fund thereafter received and not
required to be otherwise applied by Section 5C hereof.
If Additional Parity Bonds are Outstanding and a separate
reserve fund or account is maintained therefor, then the moneys
replaced in the Reserve Account and such separate reserve fund or
account shall be replaced on a pro rata basis, as moneys become
available therefor.
If at any time the City shall for any reason fail to pay
into the Reserve Account the full amount stipulated herein from the
moneys credited to the Sales and Use Tax Fund, the difference
between the amount paid and the amount stipulated shall in a like
manner be paid therein from the first moneys credited to the Sales
and Use Tax Fund thereafter received and not required to be applied
otherwise by Section 5C hereof.
Nothing in this Ordinance shall be construed as limiting
the right of the City to substitute for the cash deposit required
to be maintained hereunder a letter of credit, surety bond,
insurance policy, agreement guaranteeing payment, or other
undertaking by a financial institution to ensure that cash in the
amount otherwise required to be maintained hereunder will be
available to the City as needed, provided that any such
substitution shall be made in conformity with the requirements of
Exhibit E to the Commitment and shall be submitted to Fitch
Investors Service, Inc. , Moody's Investors Service, Inc. and
48
Standard & Poor's Corporation and shall not cause the then-current
ratings of the Bonds to be adversely affected. Any such credit
instrument shall be deposited with the Paying Agent, which shall
ascertain the necessity for a claim against or draw upon the credit
instrument and provide notice to the issuer of such credit
instrument in accordance with its terms not later than three (3)
days (or such longer period as may be necessary, depending on the
permitted time period for honoring claims or draws thereunder)
prior to each Interest Payment Date. If a letter of credit is
substituted for the cash deposit required to be maintained
hereunder, the Paying Agent shall draw upon such letter of credit
prior to its expiration or termination unless an alternate credit
instrument conforming with the provisions hereof has been
substituted therefor or the amount otherwise required to be
maintained hereunder is on deposit in the Reserve Account.
E. Termination of Deposits. No payment need be made
into the Principal and Interest Account or the Reserve Account if
the amount in the Principal and Interest Account and the amount in
the Reserve Account total a sum at least equal to the entire
principal amount of the Outstanding Bonds and any Outstanding
Additional Parity Bonds or other Parity Securities, as to all Debt
Service Requirements, to their respective Maturity Dates or to any
Redemption Date or Redemption Dates on which the City shall have
exercised or shall have obligated itself to exercise its option to
redeem, prior to their respective Maturity Dates, any Bonds, any
Additional Parity Bonds or any other Parity Securities then
Outstanding and thereafter maturing, both accrued and not accrued
(provided that, solely for the purpose of this Section 5E, there
shall be deemed to be a credit to the Reserve Account moneys,
Federal Securities and bank deposits, or any combination thereof,
accounted for in any other account or accounts of the City and
restricted solely for the purpose of paying the Debt Service
Requirements of the Bonds, any Additional Parity Bonds or any other
Parity Securities) , in which case moneys in the Principal and
Interest Account and the Reserve Account in an amount, except for
any known interest or other gain to accrue from any investment or
deposit of moneys pursuant to Section 6B hereof from the time of
any such investment or deposit to the time or respective times the
proceeds of any such investment or deposit shall be needed for such
payment, at least equal to such Debt Service Requirements, shall be
used together with any such gain from such investments and deposits
solely to pay such Debt Service Requirements as the same become
due; and any moneys in excess thereof in the Principal and Interest
Account and the Reserve Account and any other moneys derived from
49
the Pledged Revenues may be used in any lawful manner determined by
the City.
F. Payment of Additional Subordinate Securities. After
there has been deposited to the Principal and Interest Account an
amount sufficient to pay all the Debt Service Requirements due or
to become due during the current Bond Year on all Bonds, Additional
Parity Bonds and other Parity Securities then Outstanding and after
the accumulations to and replenishments of the Reserve Account to
be made in the current Bond Year have been made, any moneys
remaining in the Sales and Use Tax Fund in any Bond Year may be
used by the City for the payment of Debt Service Requirements of
Subordinate Securities payable from the Pledged Revenues and
authorized to be issued in accordance with this Ordinance,
including reasonable reserves for such Subordinate Securities; but
the lien of such Subordinate Securities on the Pledged Revenues and
the pledge thereof for the payment of such Subordinate Securities
shall be subordinate to the lien and pledge of the Bonds, any
Additional Parity Bonds and any other Parity Securities as herein
provided.
G. Use of Remaining Revenues. After the payments
hereinabove required to be made by Sections 5C through 5F hereof
are made, at the end of any month, or whenever in any month there
shall have been credited to the Principal and Interest Account and
to the Reserve Account for the payment of the Bonds and any other
securities payable from the Pledged Revenues all amounts required
to be deposited in those funds at that time, as herein provided,
any remaining Pledged Revenues shall be transferred to such fund of
the City as the City shall determine.
H. Budget and Appropriation of Sums. The sums provided
to make the payments specified in this Section 5 are hereby
appropriated for said purposes, and said amounts for each year
shall be included in the annual budget and the appropriation
ordinance or measures to be adopted or passed by the Council in
each year while any of the Bonds, as to either principal or
interest, are Outstanding and unpaid. No provisions of any
constitution, charter, statute, ordinance, resolution, or other
order or measure enacted after the issuance of the Bonds shall in
any manner be construed as limiting or impairing the obligation of
the City to keep and perform the covenants contained in this
Ordinance so long as any of the Bonds remain Outstanding and
unpaid. Nothing herein shall prohibit the Council from
appropriating other funds of the City legally available for this
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purpose to the Sales and Use Tax Fund or the Principal and Interest
Account for the purpose of providing for the Debt Service
Requirements of the Bonds.
I. Excess Investment Earnings Account. The Financial
Officer shall transfer into and pay from a separate special fund
hereby created as a restricted account within the Sales and Use Tax
Fund and designated as the "City of Fort Collins, Colorado, Sales
and Use Tax Revenue Refunding Bonds, Series 1993, Excess Investment
Earnings Account" the amount of required arbitrage rebate, if any,
due to the federal government under Sections 103 and 148 (f) (2) of
the Tax Code and regulations promulgated thereunder. The Financial
Officer shall determine such amounts in the manner required by said
sections and related regulations. Transfer of the required
arbitrage rebate amounts shall be made from the Principal and
Interest Account and the Reserve Account, provided, however, that
required arbitrage rebate payments shall be made to the federal
government from legally available funds regardless of whether there
are any remaining proceeds or other funds attributable to the Bonds
that are available for the purpose.
All amounts in the Excess Investment Earnings Account,
including income earned from investment thereof, shall be held by
the Financial Officer free and clear of any lien created by this
Ordinance, and the Financial Off icer shall pay over to the federal
government from time to time as the Financial Officer shall
determine provided that the Financial Officer shall so pay over to
the federal government not less frequently than once each five (5)
years after the date of issuance of the Bonds, an amount equal to
ninety percent (90%) of the required arbitrage rebate amount earned
during such period (and not theretofore paid to the federal
government) and not later than sixty (60) days after the redemption
of the last Bond, one hundred percent (100%) of the required
arbitrage rebate amount.
Section 6. General Administration of Funds and Accounts.
A. Places and Times of Deposits. Each of the special
funds or accounts referred to in Section 5. hereof shall be
maintained and kept separate and apart from all other accounts or
funds of the City as trust accounts solely for the purposes herein
designated therefor. For purposes of investment of moneys,
nothing, except as specifically provided herein, prevents the
commingling of moneys accounted for in any two or more such funds
or accounts pertaining to the Pledged Revenues or to such fund and
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AIM-
account and any other funds or accounts of the City adopted or
created under this Ordinance. Such funds or accounts shall be
continuously secured to the fullest extent required and permitted
by the laws of the State for the securing of public funds and shall
be irrevocable and not withdrawable by anyone for any purpose other
than the respective designated purposes of such funds and accounts.
Each periodic payment shall be credited to the proper fund or
account not later than the date therefor herein designated, except
that when any such date shall be a Saturday, a Sunday or a legal
holiday, then such payment shall be made on or before the next
preceding business day.
B. Investment of Funds and Accounts. Any moneys in any
fund or account described in this Ordinance with the exception of
the Escrow Account may be deposited, invested, or reinvested only
in Permitted Investments. Securities or obligations purchased as
such an investment shall either be subject to redemption at any
time at face value by the Owner thereof at the option of such Owner
or shall mature at such time or times as shall most nearly coincide
with the expected need for moneys from the fund or account in
question. Securities or obligations so purchased as an investment
of moneys in any such fund or account shall be deemed at all times
to be a part of the applicable fund or account; provided that, with
the exception of the Escrow Account, the Reserve Account and the
Excess Investment Earnings Account, the interest accruing on such
investments and any prof it realized therefrom shall be credited to
the Sales and Use Tax Fund, and any loss resulting from such
investments shall be charged to the particular fund or account in
question. Interest and profit realized from investments in the
Reserve Account shall be credited to the Reserve Account, provided
that, so long as the amount in the Reserve Account equals at least
the minimum amount specified in Section 5D hereof, such interest
and profit may be transferred to the Principal and Interest Account
and distributed in the same manner as other moneys in the Principal
and Interest Account. Any loss resulting from such investments in
the Reserve Account shall be charged to the Reserve Account.
Investments in the Reserve Account shall have a term to maturity
not greater than five (5) years, except that Direct Obligations and
Agency Obligations may have a term in excess of five (5) years but
not longer than the final maturity of the Bonds. Investments in
the Reserve Account shall be valued by the City as frequently as
deemed necessary by the Bond Insurer, but not less often than
quarterly, at the market value thereof, exclusive of accrued
interest. If on any valuation date the market value of investments
in the Reserve Account is less than the amount required by Section
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1
5D hereof to be maintained therein due to market fluctuations, the
deficiency shall be remedied no later than the next quarterly
valuation date. The City shall present for redemption or sale on
the prevailing market any securities or obligations so purchased as
an investment of moneys in a given fund or account whenever it
shall be necessary to do so in order to provide moneys to meet any
required payment or transfer from such fund or account. The City
shall not invest any moneys accounted for hereunder if any such
investment would contravene the covenant concerning arbitrage in
Section 80 hereof.
C. No Liability for Losses Incurred in Performing Terms
of Ordinance. Neither the City nor any officer of the City shall
be liable or responsible for any loss resulting from any investment
or reinvestment made in accordance with this Ordinance.
D. Character of Funds. The moneys in any fund or
account herein authorized shall consist of lawful money of the
United States of America or Permitted Investments or both such
money and Permitted Investments. Moneys deposited in a demand or
time deposit account in a Commercial Bank, appropriately secured
according to the laws of the State, shall be deemed lawful money of
the United States of America.
E. Accelerated Payments Optional. Nothing contained
herein prevents the accumulation in any fund or account herein
designated of any monetary requirements at a faster rate than the
rate or minimum rate, as the case may be, provided therefor, but no
payment shall be so accelerated if such acceleration shall cause a
default in the payment of any obligation of the City pertaining to
the Pledged Revenues.
Section 7. Priorities; Liens; Issuance of Additional
Bonds.
A. First Lien on Pledged Revenues. Except as expressly
provided in this Ordinance with respect to the issuance of
Additional Parity Bonds, Parity Securities or Subordinate
Securities, the Pledged Revenues shall be and hereby are
irrevocably assigned, pledged and set aside to pay the Debt Service
Requirements of the Bonds. The Bonds constitute an irrevocable and
first lien (but not necessarily an exclusive first lien) upon the
Pledged Revenues. The Bonds, any Additional Parity Bonds and any
other Parity Securities authorized to be issued and from time to
time Outstanding are equitably and ratably secured by a lien on the
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c ,
Pledged Revenues and shall not be entitled to any priority one over
the other in the application of the Pledged Revenues regardless of
the time or times of the issuance of the Bonds, any Additional
Parity Bonds and any other Parity Securities, it being the
intention of the Council that there shall be no priority among the
Bonds, any Additional Parity Bonds and any other Parity Securities,
regardless of the fact that they may be actually issued and
delivered at different times.
B. Issuance Of Additional Parity Bonds. Nothing
herein, subject to the limitations stated in Section 7F hereof,
prevents the issuance by the City of Additional Parity Bonds
payable from the Pledged Revenues and constituting a lien on the
Pledged Revenues on a parity with, but not prior or superior to,
the lien thereon of the Bonds; but before any such Additional
Parity Bonds are authorized or actually issued the following
provisions must first be satisfied:
(1) Absence of Default. At the time of the
adoption of the supplemental ordinance or other instrument
authorizing the issuance of the Additional Parity Bonds as
provided in Section 7F hereof, the City shall not be in
default in making any payments required by Section 5 hereof
and there shall not have occurred and be continuing any Event
of Default.
(2) Historic Revenues Test. Except as hereinafter
provided in the case of Additional Parity Bonds issued for the
purpose of refunding less than all of the Bonds and other
Parity Securities then Outstanding, the Net Revenue collected
by the City from the Sales and Use Tax, as certified by an
Independent Accountant, derived in the last complete Fiscal
Year immediately preceding the date of the issuance of such
Additional Parity Bonds shall have been sufficient to pay an
amount at least equal to one hundred fifty percent (150%) of
the Combined Average Annual Debt Service Requirements or, if
the Combined Average Annual Debt Service Requirements are less
than seventy-f ive percent (7 5%) of the Combined Maximum Annual
Debt Service Requirements, an amount at least equal to one
hundred fifty percent (150%) of the Combined Maximum Annual
Debt Service Requirements of the Outstanding Bonds, any
Additional Parity Bonds, any other Parity Securities and the
Additional Parity Bonds proposed to be issued. If additional
Sales and Use Taxes in excess of those authorized as of the
date hereof have been imposed during such Fiscal Year, the
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amount of such Net Revenue may be adjusted by adding the
additional Net Revenue that would have been received by the
City from the imposition of such additional Sales and Use
Taxes as if such additional Sales and Use Taxes had been in
effect during the entire Fiscal Year. For purposes of this
Section 7B(2) , the Debt Service Requirements of any Additional
Parity Bonds, any other Parity Securities and any Additional
Parity Bonds proposed to be issued bearing interest at a
variable or adjustable rate shall be assumed to bear interest
at the maximum interest rate permitted by the ordinance,
supplemental ordinance or other instrument of the Council
authorizing the issuance thereof. In the case of Additional
Parity Bonds issued for the purpose of refunding less than all
of the Bonds and other Parity Securities then Outstanding,
compliance with this Section 7B(2) shall not be required so
long as the Debt Service Requirements payable on all Bonds and
other Parity Securities Outstanding after the issuance of such
Additional Parity Bonds on each Interest Payment Date does not
exceed the Debt Service Requirements payable on all Bonds and
other Parity Securities Outstanding prior to the issuance of
such Additional Parity Bonds on such Interest Payment Dates.
(3) Adequate Reserves. The Reserve Account shall
be fully funded in accordance with Section 5D hereof, and the
proceedings under which any such Additional Parity Bonds are
issued must provide for the deposit of moneys to the Reserve
Account on substantially the same terms as provided in Section
5D hereof and contain a covenant by the City to maintain the
Reserve Account in an amount at least equal to the minimum
amount required by Section 5D hereof. Alternatively, if such
action is deemed by the City to be necessary or desirable in
order to comply with any statute or regulation governing the
exclusion from gross income for federal income tax purposes of
interest on any such Additional Parity Bonds, the proceedings
under which any such Additional Parity Bonds are issued may
provide for the deposit of moneys to a reserve fund or account
(other than the Reserve Account) established and maintained
for any such Additional Parity Bonds on substantially the same
terms as provided in Section 5D hereof and contain a covenant
by the City to maintain such reserve fund or account in an
amount at least equal to the minimum amount required by
Section 5D hereof, except as may be necessary to comply with
such statute or regulation. Any such reserve fund or account
shall have a claim to the Pledged Revenues equal to and on a
parity with the Reserve Account.
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The City shall not issue any Additional Parity Bonds
bearing interest at a variable or adjustable rate which is not
fixed for the entire term thereof without the prior written
approval of the Bond Insurer.
C. Certification of Historic Revenues. In the case of
the computation of the historic revenues test provided in
Section 7B hereof, the specified and required written
certifications by the Independent Accountant that such annual
revenues are sufficient to pay such amounts as provided in
Section 7B hereof shall be conclusively presumed to be accurate in
determining the right of the City to authorize, issue, sell and
deliver Additional Parity Bonds.
D. Subordinate Securities Permitted. Nothing herein,
subject to the limitations stated in Section 7F hereof, prevents
the City from issuing Subordinate Bonds or Subordinate Securities
for any lawful purpose.
E. Superior Securities Prohibited. Nothing herein
permits the City to issue Superior Bonds or Superior Securities.
F. Supplemental Ordinances. Additional Parity Bonds or
Subordinate Securities shall be issued only after authorization
thereof by ordinance, supplemental ordinance or other instrument of
the Council, in substantially the same form as this Ordinance,
stating the purpose or purposes of the issuance of such additional
securities, directing the application of the proceeds thereof to
such purpose or purposes, directing the execution thereof, and
fixing and determining the date, series designation, principal
amount, maturity or maturities, maximum rate or rates of interest,
and prior redemption privileges of the City with respect thereto,
and providing for payments to and from the Sales and Use Tax Fund
in accordance with this Ordinance. All additional securities shall
bear such date, shall be payable as to principal on June 1 or
December 1 or both and as to interest on June 1 and December 1 and
shall be subject to redemption prior to maturity on such terms and
conditions, as may be provided, and shall bear interest at such
rate or rates as may be fixed by ordinance, instrument or other
document of the Council. Nothing herein shall be construed to
prohibit the issuance of additional securities payable from the
Pledged Revenues, the interest on which is payable more frequently
than semiannually.
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Section 8. Covenants.
The City hereby particularly covenants and agrees with
the Bond Insurer and with the Owners of the Bonds from time to
time, and makes provisions which shall be a part of its contract
with such Owners, which covenants and provisions shall be kept by
the City continuously until all of the Bonds have been fully paid
and discharged:
A. Continuance and Collection of Sales and Use Taxes.
(1) Ordinance No. 58, 1967, Ordinance No. 140,
1979, and Ordinance No. 149, 1981, as originally adopted, have
not been repealed or amended, except by Ordinance No. 4, 1968,
Ordinance No. 6, 1968, Ordinance No. 23, 1974, Ordinance No.
137, 1977, Ordinance No. 87, 1981, Ordinance No. 113, 1984,
Ordinance No. 122, 1986, Ordinance No. 192, 1987, Ordinance
No. 8, 1988, Ordinance No. 60, 1988, and Ordinance No. 132,
1991, and are now in full f orce and of f ect. The City will not
repeal or amend said ordinances in any manner which would
diminish the Pledged Revenues.
(2) The City shall continue to levy, impose,
administer, enforce and collect the Sales and Use Tax on sales
and purchases of tangible personal property at retail and
storage, use, distribution and consumption of tangible
personal property purchased or acquired at retail, within the
City, in accordance with Ordinance No. 58, 1967, Ordinance
No. 140, 1979, and Ordinance No. 149, 1981, without reduction
in the percentage rate of the Sales and Use Tax as set forth
therein.
(3) The City shall maintain the Sales and Use Tax
Fund as a fund of the City separate and distinct from all
other funds of the City and shall place the Pledged Revenues
therein. The Sales and Use Tax Fund shall be subject to
appropriation only as authorized by this Ordinance.
(4) All of the Pledged Revenues shall be subject to
the payment of the Debt Service Requirements of all securities
payable . from the Pledged Revenues, including reserves
therefor, as provided herein or in any instrument supplemental
or amendatory hereto.
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B. Defense of Legality of Pledged Revenues. There is
not pending or threatened any suit, action or proceeding against or
affecting the City before or by any court, arbitrator,
administrative agency or other governmental authority which affects
the validity or legality of this Ordinance, Ordinance No. 58, 1967,
Ordinance No. 140, 1979, or Ordinance No. 149, 1981, the imposition
and collection of the Sales and Use Tax, or any of the City's
obligations under such Ordinances.
The City shall, to the extent permitted by law, defend
the validity and legality of the Sales and Use Tax and Ordinance
No. 58, 1967, Ordinance No. 140, 1979, and Ordinance No. 149, 1981,
and all amendments thereto against all claims, suits and
proceedings which would diminish or impair the Pledged Revenues.
Furthermore, the City shall, to the extent permitted by law, amend
from time to time the provisions of Ordinance No. 58, 1967,
Ordinance No. 140, 1979, and Ordinance No. 149, 1981, as necessary
to prevent impairment of the Pledged Revenues as required to meet
the Debt Service Requirements of the Bonds when due.
Except as permitted in this Ordinance, the City has not
assigned or pledged the Pledged Revenues in any manner which would
diminish the security for payment of the Bonds.
C. Performance of Duties. The City, acting and through
its officers, or otherwise, shall faithfully and punctually
perform, or cause to be performed, all duties with respect to the
Pledged Revenues required by the Constitution and laws of the
State, the Charter and the various ordinances, resolutions and
contracts of the City, including, without limitation, the proper
segregation of the proceeds of the Bonds and the Pledged Revenues
and their application from time to time to the respective funds
provided therefor.
D. Contractual Obligations. The City will perform all
contractual obligations undertaken by it under the Bond Purchase
Agreement and any other agreements relating to the Bonds and the
Pledged Revenues.
E. Further Assurances. At any and all times the City
shall, so far as it may be authorized by law, pass, make, do,
execute, acknowledge, deliver, and file or record all and every
such further instruments, acts, deeds, conveyances, assignments,
transfers, other documents, and assurances as may be necessary or
desirable for the better assuring, conveying, granting, assigning
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"All
and confirming all and singular the rights, the Pledged Revenues
and other funds and accounts hereby pledged or assigned, or
intended so to be, or which the City may hereafter become bound to
pledge or to assign, or as may be reasonable and required to carry
out the purposes of this Ordinance. The City, acting by and
through its officers, or otherwise, shall at all times, to the
extent permitted by law, defend, preserve and protect the pledge of
the Pledged Revenues and other funds and accounts pledged hereunder
and all the rights of every Owner of any of the Bonds against all
claims and demands of all Persons whomsoever.
F. Conditions Precedent. Upon the date of issuance of
any of the Bonds, all conditions, acts and things required by the
Constitution or laws of the United States of America, the
Constitution or laws of the State, the Charter, or this Ordinance,
to exist, to have happened, and to have been performed precedent to
or in the issuance of the Bonds shall exist, have happened and have
been performed, and the Bonds do not contravene any debt or other
limitation prescribed by the Constitution or laws of the United
States of America, the Constitution or laws of the State or the
Charter.
G. Records. The City will keep proper books of record
and account, separate and apart from all other records and
accounts, showing complete and correct entries of all transactions
relating to the funds and accounts described herein.
H. Protection of Security. The City, its officers,
agents and employees, shall not take any action in such manner or
to such extent as might prejudice the security for the payment of
the Debt Service Requirements of the Bonds and any other securities
payable from the Pledged Revenues according to the terms thereof.
No contract shall be entered into nor any other action taken by
which the rights of any Owner of any Bond or other security payable
from Pledged Revenues might be materially impaired or diminished.
I. Accumulation of Interest Claims. In order to
prevent any accumulation of claims for interest after maturity, the
City shall not directly or indirectly extend or assent to the
extension of the time for the payment of any claim for interest on
any of the Bonds or any other securities payable from the Pledged
Revenues; and the City shall not directly or indirectly be a party
to or approve any arrangements for any such extension or for the
purpose of keeping alive any of such other claims for interest. If
the time for the payment of any such installment of interest is
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, t
extended in contravention of the foregoing provisions, such
installment or installments of interest after such extension or
arrangement shall not be entitled in case of default hereunder to
the benefit or the security of this Ordinance, except upon the
prior payment in full of the principal of all of the Bonds and any
such securities the payment of which has not been extended.
J. Prompt Payment of Bonds. The City shall promptly
pay the Debt Service Requirements of every Bond on the dates and in
the manner specified herein and in the Bonds according to the true
intent and meaning hereof.
K. Use of Principal and Interest Account and Reserve
Account. The Principal and Interest Account and the Reserve
Account shall be used solely and only, and the moneys credited to
such accounts are hereby pledged, for the purpose of paying the
Debt Service Requirements of the Bonds, any Additional Parity Bonds
or any other Parity Securities at maturity or upon prior
redemption, subject to the provisions concerning surplus moneys in
Section 5E hereof and subject to Section 9 hereof.
L. Additional Securities. The City shall not hereafter
issue any bonds or securities payable from the Pledged Revenues
without compliance with the requirements with .respect to the
issuance of Additional Parity Bonds set forth herein to the extent
applicable.
M. Other Liens. There are no liens or encumbrances of
any nature whatsoever on or against any of the Pledged Revenues,
except to secure payment of the principal of and interest on the
City's Downtown Development Authority Tax Increment Revenue
Refunding Bonds, Series 1992, dated March 15, 1992, in the
aggregate principal amount of $11,380,000 (subordinate lien) .
N. Surety Bonds. Each official or other person having
custody of any Pledged Revenues, or responsible for their handling,
shall be fully bonded at all times, which bond shall be conditioned
upon the proper application of said moneys.
O. Arbitrage. The City shall make no investment or
other use of the proceeds of the Bonds at any time during the term
thereof which, if such investment or other use had been reasonably
expected on the date the Bonds are issued, would have caused the
Bonds to be arbitrage bonds within the meaning of the Tax Code and
the regulations thereunder and shall comply with all the
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requirements of the Tax Code and said regulations throughout the
term of the Bonds.
P. Information and Notices. The City shall provide to
the Bond Insurer the following: within one hundred eighty (180)
days after the end of each Fiscal Year, the City's budget for the
current Fiscal Year, the City's audited financial statements for
the Fiscal Year most recently ended, a statement of the amount on
deposit in the Reserve Account as of the last valuation date and
(if not included in the City's audited financial statements) a
statement of the Pledged Revenues for the Fiscal Year most recently
completed; within thirty (30) days after the sale of any
obligations payable from the Pledged Revenues, any official
statement or other disclosure document prepared in connection
therewith; notice of any draw upon or deficiency due to market
fluctuation in the amount on deposit in the Reserve Account; and
such additional information as the Bond Insurer may reasonably
request from time to time.
Section 9. Defeasance..
When all Debt Service Requirements of the Bonds have been
duly paid, the pledge and lien and all obligations hereunder shall
thereby be discharged and the Bonds shall no longer be deemed to be
Outstanding within the meaning of this Ordinance. There shall be
deemed to be such due payment when the City has placed in escrow or
in trust with a Trust Bank located within or without the State,
moneys or Federal Securities in an amount sufficient (including the
known minimum yield available for such purpose from Federal
Securities in which such amount wholly or in part may be initially
invested) to meet all Debt Service Requirements of the Bonds, as
the same become due to their respective Maturity Dates or to any
Redemption Date as of which the City shall have exercised or shall
have obligated itself to exercise its option to redeem Bonds prior
to their respective Maturity Dates. The Federal Securities shall
be non-callable and non-prepayable and shall become due prior to
the respective times at which the proceeds thereof shall be needed,
in accordance with a schedule established and agreed upon between
the City and such Trust Bank at the time of the creation of the
escrow or trust, or the Federal Securities shall be subject to
redemption at the option of the Owner thereof to assure such
availability as so needed to meet such schedule. The City shall
cause a copy of the report verifying the sufficiency of such escrow
or trust prepared by a certified public accountant licensed to
practice in the State and acceptable to the Bond Insurer to be
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delivered to the Bond Insurer. Any Debt Service Requirements of
the Bonds paid by the Bond Insurer shall not be deemed paid
pursuant to this Ordinance until paid by the City in accordance
herewith.
Nothing herein shall be construed to prohibit a partial
defeasance of the Outstanding Bonds in accordance with the
provisions of this Section 9.
Section 10. Default Provisions and Remedies of Bond
Owners.
A. Events of Default. Each of the following events is
hereby declared to be an Event of Default by the City:
(1) Nonpayment of Principal or Premium. Payment of
the principal of any of the Bonds or any premium due in
connection with the redemption thereof is not made from
sources other than the Bond Insurance Policy when the same
becomes due and payable, either at maturity or upon prior
redemption, or otherwise;
(2) Nonpayment of Interest. Payment of any
installment of interest on any of the Bonds is not made from
sources other than the Bond Insurance Policy when the same
becomes due and payable;
(3) Incapacity to Perform. The City for any reason
becomes incapable of fulfilling its obligations hereunder;
(4) Nonperformance of Duties. The City shall have
failed to carry out and to perform (or in good faith to begin
the performance of) all acts and things lawfully required to
be carried out to be performed by it under any contract
relating to the Bonds or the Pledged Revenues, or to all or
any combination thereof, or otherwise including, without
limitation, this Ordinance, and such failure shall continue
for sixty (60) days after receipt of notice from the Owners of
ten percent (10%) in aggregate principal amount of the Bonds
then Outstanding;
(5) Appointment of Receiver. An order or decree is
entered by a court of competent jurisdiction, with the consent
or acquiescence of the City, appointing a receiver or
receivers for the Pledged Revenues and any other moneys
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subject to the lien to secure the payment of the Bonds, or if
any order or decree, having been entered without the consent
or acquiescence of the City, is not vacated or discharged or
stayed on appeal within sixty (60) days after entry;
(6) Default of Any Provision. The City makes any
default in the due and punctual performance of any other of
the representations, covenants, conditions, agreements and
other provisions contained in the Bonds or in this Ordinance
on its part to be performed, and such default continues for
sixty (60) days after written notice, specifying such default
and requiring the same to be remedied, is given to the City by
the Owners of ten percent (10%) in aggregate principal amount
of the Bonds then Outstanding.
B. Remedies for Defaults. The City shall give notice
to the Bond Insurer of any Event of Default under Section 10A(1) or
(2) hereof immediately upon the occurrence thereof and of any Event
of Default under Section 10A(3) , (4) , (5) or (6) hereof known to
the City within thirty (30) days of obtaining knowledge thereof.
Upon the happening and continuance of any of the Event of Default,
provided that the Bond Insurer has made all payments of principal
and interest on the Bonds as required by the Bond Insurance Policy,
the Bond Insurer, acting alone, shall have the right to direct all
remedies against the City with respect to the Bonds, and no such
remedies shall be exercised without the consent of the Bond
Insurer. Subject to the foregoing, the Owner or Owners of not less
than ten percent (10%) in aggregate principal amount of the Bonds
then Outstanding, including, without limitation, a trustee or
trustees therefor, may proceed against the City and its agents,
officers and employees to protect and to enforce the rights of any
Owner of Bonds under this Ordinance by mandatory injunction or by
other suit, action, or special proceedings in equity or at law, in
any court of competent jurisdiction, either for the appointment of
a receiver or an operating trustee or for the specific performance
of any covenant or agreement contained herein or for any proper
legal or equitable remedy as such Owner or Owners may deem most
effectual to protect and to enforce the aforesaid rights, or
thereby to enjoin any act or thing which may be unlawful or in
violation of any right of any Owner of any Bond, or to require the
City to act as if it were the trustee of an expressed trust, or any
combination of such remedies, or as otherwise may be authorized by
any statute or other provision of law. All such proceedings at law
or in equity shall be instituted, had and maintained for the equal
benef it of all Owners of the Bonds, and any Parity Securities then
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Outstanding. Any receiver or operating trustee appointed in any
proceedings to protect the rights of such Owners hereunder, the
consent to any such appointment being hereby expressly granted by
the City, may collect, receive and apply all Pledged Revenues
arising after the appointment of such receiver or operating trustee
in the same manner as the City itself might do. Notwithstanding
the foregoing or any other applicable provisions of law, no Event
of Default shall result in acceleration of any obligation of the
City represented by the Bonds.
C. Rights and Privileges Cumulative. The failure of
any Owner of any Outstanding Bond to proceed in any manner herein
provided shall not relieve the City, or any of its officers, agents
or employees of any liability for failure to perform or carry out
any duty, obligation or other commitment. Each right or privilege
of any such Owner or any trustee thereof is in addition and is
cumulative to any other right or privilege, and the exercise of any
right or privilege by or on behalf of any Owner shall not be deemed
a waiver of any other right or privilege thereof. Each Owner of
any Bond shall be entitled to all of the privileges, rights, and
remedies provided or permitted in this Ordinance and as otherwise
provided or permitted by law or in equity or by statute, except as
provided in Section 12A and Section 12B hereof, and subject to the
applicable provisions concerning the Pledged Revenues and the
proceeds of the Bonds. Nothing herein affects or impairs the right
of any Owner of any Bond to enforce the payment of the Debt Service
Requirements due in connection with his, her or its Bond or the
obligation of the City to pay the Debt Service Requirements of each
Bond to the Owner thereof at the time and the place expressed in
such Bond.
D. Duties Upon Defaults. Upon the happening of any of
the Events of Default as provided in Section 10A hereof, the City,
in addition, shall do and perform all proper acts on behalf of and
for the Owners of the Outstanding Bonds to protect and to preserve
the security created for the payment of their Bonds and to insure
the payment of the Debt Service Requirements of the Bonds promptly
as the same become due. During any period of' default, so long as
any of the Bonds, as to any Debt Service Requirements, are
Outstanding, except to the extent it may be unlawful to do so, all
Pledged Revenues shall be paid into the Principal and Interest
Account, or, in the event of securities hereafter or heretofore
issued and Outstanding during such period of time on a parity with
the Bonds, shall be applied as provided in Section 5C hereof for
all Parity Securities, including the Bonds, on an equitable and
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t .
prorated basis, and used for the purposes therein provided. If the
City fails or refuses to proceed as in this Section 10D provided,
the Owner or Owners of not less than ten percent (10%) in principal
amount of the Bonds then Outstanding, after demand in writing, may
proceed to protect and to enforce the rights of the Owners of the
Bonds as hereinabove provided; and to that end any such Owners of
Outstanding Bonds shall be subrogated to all rights of the City
under any agreement or contract involving the Pledged Revenues
entered into prior to the effective date of this Ordinance or
thereafter while any of the Bonds are Outstanding. Nothing herein
requires the City to proceed as provided herein if it determines in
good faith and without any abuse of its discretion that such action
is likely materially and prejudicially to affect the Owners of the
Outstanding Bonds and any Outstanding Parity Securities.
E. Evidence of Security Owners. Any request, consent
or other instrument which this Ordinance may require or may permit
to be signed and to be executed by the Owner of any Bonds or other
securities may be in one instrument or more than one instrument of
similar tenor and shall be signed or may be executed by each Owner
in person or by his attorney appointed in writing. Proof of the
execution of any such instrument or of any instrument appointing
any such attorney, or the ownership by any Person of the
securities, shall be sufficient for any purpose of this Ordinance
(except as otherwise herein expressly provided) if made in the
following manner:
(1) Proof of Execution. The fact and the date of
the execution by any Owner of any Bonds or other securities or
his attorney of such instrument may be proved by the
certificate, which need not be acknowledged or verified, of
any officer of a bank or trust company satisfactory to the
City Clerk or of any notary public or other officer authorized
to take acknowledgments of deeds to be recorded in the state
in which he or she purports to act that the individual signing
such request or other instrument acknowledged to him or her
the execution, duly sworn to before such notary public or
other officer; the authority of the individual or individuals
executing any such instrument on behalf of a corporate Owner
of any securities may be established without further proof if
such instrument is signed by an individual purporting to be
the president or vice-president of such corporation with the
corporate seal affixed and attested by an individual
purporting to be its secretary or an assistant secretary; and
the authority of any Person or Persons executing any such
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instrument in any fiduciary or representative capacity may be
established without further proof if such instrument is signed
by a Person or Persons purporting to act in such fiduciary or
representative capacity; and
(2) Proof of Ownership. The amount of Bonds owned
by any Person executing any instrument as an Owner of Bonds,
and the numbers, dates and other identification thereof,
together with the dates of his ownership of the Bonds, shall
be determined from the registration books of the City. The
amount of other securities, if applicable, owned by any Person
executing any instrument as an Owner of such securities, and
the numbers, dates and other identification thereof, together
with the dates of his ownership, if in bearer form, may be
proved by a certificate which need not be acknowledged or
verified, in form satisfactory to the City Clerk, executed by
a member of a financial firm or by an officer of a bank or
trust company, insurance company or financial corporation or
other depository satisfactory to the City Clerk, or by any
notary public or other officer authorized to take
acknowledgments of deeds to be recorded in the state in which
he or she purports to act, showing at the date therein
mentioned that such Person exhibited to such member, officer,
notary public or other officer so authorized to take
acknowledgments of deeds or had on deposit with such
depository the securities described in such certificate or if
in registered form shall be determined from the related
registration books; but the City Clerk may nevertheless in his
or her discretion require further or other proof in cases
where he or she deems the same advisable.
F. Warranty Upon Issuance of Bonds. Any of the Bonds
as herein provided, when duly executed and registered for the
purposes provided for in this Ordinance, shall constitute a
warranty by and on behalf of the City for the benefit of each and
every future Owner of any of the Bonds that the Bonds have been
issued for a valuable consideration in full conformity with law.
G. Bond Insurer as Bond Owner. So long as the Bond
Insurer is not then in default under the Bond Insurance Policy, the
Bond Insurer shall be deemed to be the Owner of all Bonds insured
by it for purposes of exercising remedies, waiving defaults, or
granting consents pursuant to this Section 10.
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H. Immunities of Purchaser. The Purchaser is under no
obligation to any Owner of the Bonds for any action that they may
not take or in respect of anything that it may or may not do by
reason of any information contained in any reports or other
documents received by them under the provisions of this Ordinance.
The immunities and exemption from liability of the Purchaser
hereunder extend to its officers, directors, successors, assigns,
employees and agents.
Section 11. Amendment of Ordinance.
A. Amendment of Ordinance Not Requiring Consent of Bond
Owners and Bond Insurer. The City may, without the consent of, or
notice to, the Owners of the Bonds, adopt such ordinances
supplemental hereto (which amendments shall thereafter form a part
hereof) for any one or more or all of the following purposes:
(1) To cure or correct any formal defect,
ambiguity or inconsistent provision contained in this
Ordinance;
(2) To appoint successors to the Paying Agent,
Registrar, Transfer Agent or Escrow Bank as provided in
Section 3B(6) hereof;
(3) To designate a trustee for the Owners of the
Bonds, to transfer custody and control of the Pledged Revenues
to such trustee, and to provide for the rights and obligations
of such trustee;
(4) To add to the covenants and agreements of the
City or the limitations and restrictions on the City set forth
herein;
(5) To pledge additional revenues, properties or
collateral to the payment of the Bonds;
(6) To cause this Ordinance to comply with the
Trust Indenture Act of 1939, as amended from time to time; or
(7) To effect any such other changes hereto which
do not in the opinion of nationally recognized bond counsel
materially adversely affect the interests of the Owners of the
Bonds.
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The City may adopt such ordinances supplemental hereto
for any one or more of the purposes specified in Section 11A(2) ,
(3) , (4) , (5) and (6) hereof without the consent of, or notice to,
the Bond Insurer. The City may adopt such ordinances supplemental
hereto for either or both of the purposes specified in Section
11A(1) or (7) only with the prior written consent of the Bond
Insurer.
Whenever the Council proposes to supplement or amend this
Ordinance under the provisions of this Section 11A, it shall give
notice of the proposed supplement or amendment and provide a copy
thereof to Fitch Investors Service, Inc. , Moody's Investors
Service, Inc. and Standard & Poor's Corporation at least fifteen
(15) days prior to its adoption and execution and shall provide a
complete transcript of all proceedings relating to such supplement
or amendment to the Bond Insurer.
B. Amendment of Ordinance Requiring Consent of Bond
Owners and Bond Insurer. Exclusive of the amendatory ordinances
covered by Section 11A hereof, this Ordinance may be amended or
modified by ordinances or other instruments duly adopted by the
Council, without receipt by it of any additional consideration but
with the written consent of the Owners of sixty-six percent (66%)
in aggregate principal amount of the Bonds Outstanding at the time
of the adoption of such amendatory ordinance and of the Bond
Insurer, provided that no such amendatory ordinance shall permit:
(1) Changing Payment. A change in the maturity or
in the terms of redemption of the principal of any Outstanding
Bond or any installment of interest thereon; or
(2) Reducing Return. A reduction in the principal
amount of any Bond, the rate of interest thereon, or any
premium payable in connection with the redemption thereof,
without the consent of the Owner of the Bond; or
(3) Prior Lien. The creation of a lien upon or a
pledge of revenues ranking prior to the lien or to the pledge
created by this Ordinance; or
(4) Modifying Amendment Terms. A reduction of the
principal amount or percentages of Bonds, or any modification
otherwise affecting the description of Bonds, otherwise
changing the consent of the Owners of Bonds, which may be
required herein for any amendment hereto; or
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(5) Priorities Among Bonds or Parity
Securities. The establishment of priorities as among Bonds
issued and Outstanding under the provisions of this Ordinance
or as among Bonds and other Parity Securities.; or
(6) Partial Modification. Any modifications
otherwise materially and prejudicially affecting the rights or
privileges of the Owners of less than all of the Bonds then
Outstanding.
Whenever the Council proposes to supplement or amend this
Ordinance under the provisions of this Section 11B, it shall give
notice of the proposed supplement or amendment by mailing such
notice to the Purchaser, or to any successor thereof known to the
City Clerk, to all Owners of Bonds at the addresses appearing on
the registration books of the City, and to the Bond Insurer. Such
notice shall briefly set forth the nature of the proposed amendment
and shall state that a copy of the proposed amendatory ordinance or
other instrument is on file in the office of the City Clerk for
public inspection. It shall also give notice of the proposed
supplement or amendment and provide a copy thereof to Fitch
Investors Service, Inc. , Moody's Investors Service, Inc. and
Standard & Poor's Corporation at least fifteen (15) days prior to
its adoption and execution and shall provide a complete transcript
of all proceedings relating to such supplement or amendment to the
Bond Insurer.
C. Time for and Consent to Amendment. Whenever at any
time within one (1) year from the date of the completion of the
notice required to be given by Section 11B hereof there shall be
filed in the office of the City Clerk an instrument or instruments
executed by the Owners of at least sixty-six percent (66%) in
aggregate principal amount of the Bonds then Outstanding and the
Bond Insurer, which instrument or instruments shall refer to the
proposed amendatory ordinance or other instrument described in such
notice and shall specifically consent to and approve the adoption
of such ordinance or other instrument, thereupon, but not
otherwise, the Council may adopt such amendatory ordinance or
instrument and such ordinance or instrument shall become effective.
If the Owners of at least sixty-six percent (66%) in aggregate
principal amount of the Bonds then Outstanding, at the time of the
adoption of such amendatory ordinance or instrument, or the
predecessors in title of such Owners, and the Bond Insurer shall
have consented to and approved the adoption thereof as herein
provided, no Owner of any Bond, whether or not such Owner shall
69
have consented to or shall have revoked any consent as herein
provided, shall have any right or interest to object to the
adoption of such amendatory ordinance or other instrument or to
object to any of the terms or provisions therein contained or to
the operation thereof or to enjoin or restrain the City from taking
any action pursuant to the provisions thereof. Any consent given
by the Owner of a Bond pursuant to the provisions thereof shall be
irrevocable for a period of six (6) months from the date of the
completion of the notice above provided for and shall be conclusive
and binding upon all future Owners of the same Bond during such
period. Such consent may be revoked at any time after six (6)
months from the completion of such notice, by the Owner who gave
such consent or by a successor in title, by filing notice of such
revocation with the City Clerk, but such revocation shall not be
effective if the Owners of sixty-six percent (66%) in aggregate
principal amount of the Bonds Outstanding as herein provided, prior
to the attempted revocation, shall have consented to and approved
the amendatory instrument referred to in such revocation.
D. Unanimous Consent. Notwithstanding anything in the
foregoing provisions contained, the terms and the provisions of
this Ordinance, or of any ordinance or instrument amendatory
thereof, and the rights and the obligations of the City and of the
Owners of the Bonds may be modified or amended in any respect
(except as would adversely affect the rights of the Owners of any
Parity Securities) upon the adoption by the City and upon the
filing with the City Clerk of an instrument to that effect and with
the consent of the Owners of all the then Outstanding Bonds and the
Bond Insurer, such consent to be given in the manner provided in
Section 11C hereof; and no notice to Owners of Bonds shall be
required as provided in Section 11B hereof, nor shall the time of
consent be limited except as may be provided in such consent.
E. Exclusion of Bonds. At the time of any consent or
of other action taken hereunder the Registrar shall furnish to the
City Clerk a certificate, upon which the City Clerk may rely,
describing all Bonds to be excluded for the purpose of consent or
of other action or of any calculation of Outstanding Bonds provided
for hereunder, and, with respect to such excluded Bonds, the City
shall not be entitled or required with respect to such Bonds to
give or obtain any consent or to take any other action provided for
hereunder.
F. Notation on Bonds. Any of the Bonds delivered after
the effective date of any action taken as provided in Section 11B
70
hereof, or Bonds Outstanding at the effective date of such action,
may bear a notation thereon by endorsement or otherwise in form
approved by the Council as to such action; and if any such Bonds so
delivered after such date does not bear such notation, then upon
demand of the Owner of any Bond Outstanding at such effective date
and upon presentation of his Bond for such purpose at the principal
office of the City, suitable notation shall be made on such Bond by
the City Clerk as to any such action. If the Council so
determines, new Bonds so modified as in the opinion of the Council
to conform to such action shall be prepared, executed and
delivered; and upon demand of the Owner of any Bond then
Outstanding, shall be exchanged without cost to such Owner for
Bonds then Outstanding upon surrender of such Outstanding Bonds.
G. Proof of Instruments and Bonds. The fact and date
of execution of any instrument under the provisions of this Section
11, the amount and number of the Bonds owned by any Person
executing such instrument, and the date of his registering the same
may be proved as provided by Section 10E hereof.
Section 12 . Miscellaneous.
A. Character of Agreement. None of the covenants,
agreements, representations, or warranties contained herein or in
the Bonds shall ever impose or shall be construed as imposing any
liability, obligation, or charge against the City (except for the
special funds pledged therefor) or against the general credit of
the City payable out of general funds or out of any funds derived
from general property taxes. Neither shall the covenants,
agreements, representations, or warranties contained herein or in
the Bonds impose or be construed as imposing any liability,
obligation, or charge against the Bond Insurer.
B. No Pledge of Property. The payment of the Bonds is
not secured by an encumbrance, mortgage or other pledge of property
of the City except for the Pledged Revenues. No property of the
City, subject to such exception with respect to the Pledged
Revenues, pledged for the payment of the Bonds, shall be liable to
be forfeited or taken in payment of the Bonds.
C. Statute of Limitations. No action or suit based
upon any Bond or other obligation of the City shall be commenced
after it is barred by any statute of limitations pertaining
thereto. Any trust or fiduciary relationship between the City and
the Owner of any Bond or the obligee regarding any such obligation
71
• c
shall be conclusively presumed to have been repudiated on the
maturity date or other due date thereof unless the Bond is
presented for payment or demand for payment of such other
obligation is otherwise made before the expiration of the
applicable limitation period. Any moneys from whatever source
derived remaining in any fund or account reserved, pledged or
otherwise held for the payment of any such obligation, action or
suit, the collection of which has been barred, shall revert to the
Sales and Use Tax Fund, unless the Council shall otherwise provide
by ordinance. Nothing herein prevents the payment of any such Bond
or other obligation after an action or suit for its collection has
been barred if the Council deems it in the best interests of the
City or the public so to do and orders such payment to be made.
D. Delegated Duties. The officers of the City are
hereby authorized and directed to enter into such agreements and
take all action necessary or appropriate to effectuate the
provisions of this Ordinance and to comply with the requirements of
law, including, without limitation:
(1) Printing. The printing of the Bonds, including
the printing upon each such Bond of a copy of the approving
legal opinion of Ballard Spahr Andrews & Ingersoll, bond
counsel, duly certified by the Registrar, and, if necessary or
desirable, the preparation of typewritten Bonds as provided
herein;
(2) Execution, Authentication, Registration and
Delivery. The execution, authentication and registration of
the Bonds and the delivery of the Bonds to the Purchaser
pursuant to the provisions of this Ordinance;
(3) Information. The assembly and dissemination of
financial and other information concerning the City and the
Bonds;
(4) Official Statement. The preparation of a final
official statement in substantially the same form as the
Preliminary Official Statement for the use of prospective
buyers of the Bonds, including, without limitation, the
Purchaser; and
(5) Closing Documents and Certificates. The
execution of the Letter of Representations, the Escrow
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Agreement and such certificates as may be reasonably required
by the Purchaser, relating, inter alia, to:
(a) The signing of the Bonds;
(b) The tenure and identity of the officials
of the City;
(c) If in accordance with fact, the absence of
litigation, pending or threatened, affecting the validity
of the Bonds;
(d) The tax treatment of interest on the Bonds
under federal and State income tax laws;
(e) The delivery of the Bonds and the receipt
of the Bond purchase price;
(f) The accuracy and completeness of
information provided in the official statement prepared
for prospective buyers of the Bonds.
E. Successors. Whenever herein the City is named or is
referred to, such provision shall be deemed to include any
successors of the City, whether so expressed or not. All of the
covenants, stipulations, obligations and agreements by or on behalf
of and other provisions for the benefit of the City contained
herein shall bind and inure to the benefit of any officer, board,
district, commission, authority, agency, instrumentality or other
Person or Persons to whom or to which there shall be transferred by
or in accordance with law any right, power or duty of the City or
of its respective successors, if any, the possession of which is
necessary or appropriate in order to comply with any such
covenants, stipulations, obligations, agreements or other
provisions hereof.
F. Rights and Immunities. Except as herein otherwise
expressly provided, nothing herein expressed or implied is intended
or shall be construed to confer upon or to give to any Person,
other than the City, the Bond Insurer, and the Owners from time to
time of the Bonds, any right, remedy or claim under or by reason
hereof or any covenant, condition or stipulation hereof. All the
covenants, stipulations, promises and agreements herein contained
by and on behalf of the City shall be for the sole and exclusive
73
benefit of the City, the Bond Insurer, and any Owner of any of the
Bonds.
No recourse shall be had for the payment of the Debt
Service Requirements of the Bonds or for any claim based thereon or
otherwise upon this Ordinance authorizing their issuance or any
other ordinance or instrument pertaining thereto, against any
individual member of the Council, or any officer or other agent of
the City, past, present or future, either directly or indirectly
through the City, or otherwise, whether by virtue of any
constitution, statute or rule of law or by the enforcement of any
penalty or otherwise, all such liability, if any, being by the
acceptance of the Bonds and as a part of the consideration of their
issuance specially waived and released.
G. Notices. Any notices required or permitted to be
given to the Bond Insurer or the Fiscal Agent hereunder shall be
addressed as follows:
Financial Guaranty Insurance Company
115 Broadway
New York, New York 10006
Attention: Managing Counsel
Citibank, N.A.
20 Exchange Place - 16th Floor
New York, New York 10005
Attention: Municipal Trust and Agency Services
Administration
H. Facsimile Signatures. Pursuant to the Uniform
Facsimile Signature of Public Officials Act, part 1 of article 55
of title 11, Colorado Revised Statutes, as amended, the Mayor, the
City Clerk and the Financial Officer shall forthwith, and in any
event prior to the time the Bonds are delivered to the Purchaser,
file with the Colorado Secretary of State their manual signatures
certified by them under oath.
I. Ordinance Irrepealable. This Ordinance is, and
shall constitute, a legislative measure of the City and after any
of the Bonds are issued, this Ordinance shall constitute an
irrevocable contract between the City and the Owner or Owners of
the Bonds; and this Ordinance, subject to the provisions of
Sections 9 and it hereof, if any Bonds are in fact issued, shall be
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and shall remain irrepealable until the Bonds, as to all Debt
Service Requirements, shall be fully paid, cancelled or discharged,
as herein provided.
J. Statutory Limitations Met. The Council hereby
determines that the provisions and limitations of the Act and any
other applicable law imposed on the issuance of the Bonds have been
met.
K. Ratification. All action not inconsistent with the
provisions of this Ordinance heretofore taken by the City or its
officers, and otherwise by the City directed toward the sale and
delivery of the Bonds for that purpose, be, and the same hereby is,
ratified, approved and confirmed.
L. Repealer. All ordinances, resolutions, bylaws,
orders, and other instruments, or parts thereof, inconsistent
herewith are hereby repealed to the extent only of such
inconsistency. This repealer shall not be construed to revive any
ordinance, resolution, bylaw, order, or other instrument, or part
thereof, heretofore repealed.
M. Severability. If any section, subsection,
paragraph, clause or other provision of this Ordinance shall for
any reason be held to be invalid or unenforceable, the invalidity
or unenforceability thereof shall not affect any of the remaining
sections, subsections, paragraphs, clauses or provisions of this
Ordinance.
READ, AMENDED, FINALLY PASSED AS AMENDED ON SECOND
READING, AND ORDERED PUBLISHED ONCE BY NUMBER AND TITLE ONLY this
6th day of July, 1993 .
CITY OF F OLLINS, ORADO
y
By:,
yor
(SEAL)
ATTEST:
�NA 11 t.�� A�& I"-'An I
City Clerk
75
(61) Superior Bonds or Superior Securities: bonds
or securities payable from the Pledged Revenues having a lien
thereon superior or senior to the lien thereon of the Bonds.
(62) Tax Code: the Internal Revenue Code of 1986,
as amended.
(63) Transfer Agent: Colorado National Bank,
Denver, Colorado, or its successors.
(64) Trust Bank: a Commercial Bank which (unless
otherwise approved by the Bond Insurer) has a combined capital
and surplus of $25, 000, 000 or more and which is authorized to
exercise and is exercising trust powers.
B. Construction. This Ordinance, except where the
context by clear implication herein otherwise requires, shall be
construed as follows:
(1) Words in the singular number include the
plural, and words in the plural include the singular.
(2) Words in the masculine gender include the
feminine and the neuter, and when the sense so indicates words
of the neuter gender refer to any gender.
(3) Articles, sections, subsections, paragraphs and
subparagraphs mentioned by number, letter or otherwise
correspond to the respective articles, sections, subsections,
paragraphs and subparagraphs of this Ordinance so numbered or
otherwise so designated.
(4) The titles and headlines applied to articles,
sections and subsections of this Ordinance are inserted only
as a matter of convenience and ease in reference and in no way
define or limit the scope or intent of any provisions of this
Ordinance.
(5) Any inconsistency between the provisions of
this Ordinance and those of the Act is intended by the
Council. To the extent of any such inconsistency the
provisions of this Ordinance shall be deemed made pursuant to
the Charter and shall supersede to the extent permitted by law
the conflicting provisions of the Act.
11