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HomeMy WebLinkAbout101 - 09/21/1982 - AUTHORIZING THE ISSUANCE OF SEWER REVENUE BONDS, DATED OCTOBER 1, 1982, IN THE AGGREGATE PRINCIPAL A ORDINANCE NO 101 , 1982 AN ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF FORT COLLINS, COLORADO, SEWER REVENUE BONDS, SERIES 1982, DATED OCTOBER 1, 1982, IN THE AGGREGATE PRINCIPAL AMOUNT OF $2 , 200, 000, AND AMENDING ORDINANCE NO 9 , 1975 BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, COLORADO, AS FOLLOWS 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) Acquire or Acquisition the design, construction, reconstruction, purchase , lease , gift, transfer , assignment, option to purchase , grant from the federal government or any public body or other person, endowment, bequest, devise , installation, condemnation, contract, or other acquirement or other provision, or any combination thereof, of facilities, other property, any project, or an interest therein, as authorized by the Act (2) Act part 4 of article 35 of title 31 , Colorado Revised Statutes 1973 , as amended (3) Additional Parity Bonds any revenue bonds of the City payable in whole or in part from Pledged Revenues, issued after the date hereof, pursuant to and in accordance with the provisions of Section 7B of this Ordinance and the Constitution and laws of the State , having a lien on the Pledged Revenues equal to or on a parity with the lien thereon of the Bonds -2- (4) Bond Year for the purpose of this Ordinance, the twelve (12) months commencing on the first day of October of any calendar year and ending on the last day of September of the next succeeding calendar year (5) Bonds those securities issued hereunder and designated as the "City of Fort Collins, Colorado, Sewer Revenue Bonds, Series 1982, " dated October 1, 1982, in the aggregate principal amount of $2, 200, 000 (6) Capital Pro3ects Fund the special fund created by Ordinance No 28, 1980, of the City and referred to in Section 5B hereof. (7) Clerk the de Sure or oe facto City Clerk of the City or his or her successor in functions, if any (8) City the City of Fort Collins, Colorado (9) Commercial Bank a state or national bank or trust company which is a member of the Federal Deposit Insurance Corporation which is located within the State, and such term includes, without limitation, any Trust Bank, as herein defined (10) Comparable Bond Year in connection with any Fiscal Year , the Bond Year which ends in such Fiscal Year For example , for the Fiscal Year commencing on January 1, 1983, the Comparable Bond Year for the Bonds commences on October 1, 1982, and enas on September 30, 1983 (11) Cost of the Propect all or any part of the cost of Acquisition, Improvement and Equipment of all or any part of the Pro3ect to be financed with the proceeds of the -3- Bonds, including , without limitation, all or any property, rights, easements, privileges, agreements, and franchises aeemed by the City to be necessary or useful and convenient therefor or in connection therewith, interest or discount on the Bonds , costs of issuance of the Bonds, engineering ana inspection costs and legal expenses, costs of financial, professional, and other estimates and advice, contingencies, any aaministrative , operating , and other expenses of the City prior to ana during such Acquisition, Improvement and Equipment, and additionally during a period of not exceeaing one year after the completion thereof, as may be estimated ana determinea by the Council, and all such other expenses as may be necessary or incident to the financing , Acquisition, Improvement, Equipment, and completion of the Pro]ect or any part thereof , ana the placing of the same in operation, provision of reserves for working capital, operation, maintenance , or replacement expenses, or for payment or security of principal of or interest on the Bonas during or after such Acquisition, Improvement or Equipment as the City may aetermine , and also reimbursements to the City or to any Person of any moneys theretofore expended for the purposes of the City or other public body or to the federal government of any moneys theretofore expended for or in connection with the Pro)ect (12) Council the Council of the City or any successor in functions thereto -4- (13) Coupons or coupons those obligations evidencing interest on and pertaining to the Bonds and any other securities payable from the Pledged Revenues, or such part of such securities as may be designated (14) Debt Service Requirements the principal of , interest on, and any premiums due in connection with the redemption of the Prior Parity Bonas , the Bonas , Additional Parity Bonds and any other securities payable from the Pledgea Revenues and heretofore or hereafter issued , if any, or such part of such securities as may be designated, as such principal , interest and premiums become due (15) Debt Service Reserve Fund the special fund created by ana designated in Ordinance No 9 , 1975, of the City as the "City of Fort Collins Sewer Refunding Revenue Bonds Reserve Fund" and referred to in Section 5F hereof (16) Eauip or EcTuipment the furnishing of all necessary or desirable , related or appurtenant machinery and other facilities, or any combination thereof, appertaining to any property, pro3ect for interest therein authorized by the Act (17) Event of Default any one of the events statea in Section 10 hereof (18) Federal Securities bills, certificates of indebtedness, notes , bonas 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, or obligations issued or -5- guaranteed as to principal and interest by any agency or person controlled or supervised by and acting as any instrumentality of the Unitea States of America pursuant to authority granted by the Congress of the United States of America (19) 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 (12) month period as may from time to time be designated by the Council or by State statute as the Fiscal Year of the City (20) Holder when used in con3unction with any coupons , any Bonds, or any other designated securities, the Person in possession and the apparent owner thereof (21) Improve or Improvement the extension, enlargement or betterment, or any combination thereof, of facilities, other property, any pro3ect , or any interest therein, as authorized by the Act, but not including reconstruction, replacement, repair or other renewal of existing facilities that noes not increase the capacity of the Sewerage Facilities or improve the treatment technology (22) Income all income from rates , fees, tolls, ana charges and tap fees or any combination thereof for the services furnished by, or the direct or inairect connection with, or the use of the Sewerage Facilities, including , without limiting the generality of the foregoing , minimum charges , charges for the availability of service , -6- disconnection fees , reconnection fees, and reasonable penalties for any delinquencies, except all sewer trunk line assessments and sewer main line assessments , and all income or other gain, if any, from any investment of Pledged Revenues and of the proceeds of securities payable from Pledged Revenues, unless the Council otherwise provides by ordinance (23) Independent Accountant any certified public accountant or any firm of such certified public accountants, auly licensed to practice and practicing as such unaer 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 inairect, 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 (24) Maximum Annual Debt Service Requirements the maximum Debt Service Requirements to be paid during any one Fiscal Year for all Outstanaing Prior Parity Bonds, Bonds, Additional Parity Bonds or other additional Parity Securities for the period beginning with the Fiscal Year in whicn such computation is maae and ending with the Fiscal Year in which all Prior Parity Bonas, Bonas, Additional Parity Bonds and other aaditional Parity Securities cease to be Outstanaing -7- (25) Mayor the de Dure or de facto Mayor of the City or his or her successor in functions, if any. (26) Net Pledoed Revenues all Income remaining after the deduction of Operation and Naintenance Expenses (27) Operation and Maintenance Expenses such reasonable and necessary current expenses of the City, paid or accrued , of operating , maintaining and repairing the Sewerage Facilities as may be determined by the Council, and the term may include at the Council 's option, except as limited by contract or otherwise limited by law, without limiting the generality of the foregoing (a) Engineering , auditing , legal and other overhead expenses of the City directly related and reasonably allocable to the administration, operation and maintenance of the Sewerage Facilities , (b) Insurance and surety bond premiums appertaining to the Sewerage Facilities , (c) Tne reasonable charges of the Paying Agent or other depository bank appertaining to the Sewerage Facilities or any bonas or other securities issued therefor , (d) Payments to pension, retirement, health and hospitalization funds appertaining to the Sewerage Facilities, (e) Any taxes, assessments, franchise fees or other charges or payments in lieu of the foregoing, -8- (f) Ordinary and current rentals of equipment or other property, (g ) Contractual services, professional services, salaries , administrative expenses , and costs of labor appertaining to the- Sewerage Facilities and the cost of materials and supplies used for current operation of the Sewerage Facilities, (h) The costs incurred in the collection of all or any part of the Pledged Revenues, (1) Any costs of utility services furnished to the Sewerage Facilities by the City or otherwise "Operation and Maintenance Expenses" aoes not include (a) Any allowance for depreciation, (b) Any costs of reconstruction, Improvement, extensions, or betterments, (c) Any accumulation of reserves for capital replacements , (d) Any reserves for operation, maintenance, or repair of the Sewerage Facilities, (e) Any allowance for the redemption of any bonds or otner securities , or the payment of any interest thereon , (f) Any liabilities incurrea in the Acquisition of any properties comprising the Pr03ect or any existing Sewerage Facilities or any combination thereof, (g) Any other ground of legal liability not based on contract -9- (28) Operation and Maintenance Fund the special fund created in Section 5D hereof (29) Ordinance this Ordinance No 101 , 1982, of the City, finally adopted by the Council on September 21, 1982, which provides for the issuance and delivery of the Bonds. (30) Outstanding when used with reference to the Prior Parity Bonds, the Bonds, any Additional Parity Bonds or any other designated securities of the City and as of any particular date, all the Prior Parity Bonds, the Bonds, Additional Parity Bonds or any such other securities payable in whole or in part from the Pledged Revenues or otherwise pertaining to the Pro3ect or the Sewerage Facilities, as the case may be, in any manner theretofore and thereupon being executed and delivered, except the following (a) Any Prior Parity Bond, Bond, Additional Parity Bond or other security cancelled by the City, by the Paying Agent, or otherwise on the City 's behalf, at or before such date, (b) Any Prior Parity Bond, Bond, Additional Parity Bond or other security held by or on behalf of the City, (c) Any Prior Parity Bond, Bond, Additional Parity Bond or other security of the City for the payment or the redemption of which moneys or Federal Securities sufficient to meet all of the payment requirements of the principal of, the interest on, and any premiums due in connection with the redemption of -10- • such Prior Parity Bond, Bond, Additional Parity Bond or other security to the date of maturity or any Redemption Date thereof, shall have theretofore been deposited in escrow or in trust with a Trust Bank for that purpose, as provided in and required by Section 9 hereof, and (d) Any lost, apparently destroyed, or wrongfully taken Prior Parity Bond , Bond, Additional Parity Bond 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 pursuant to this Ordinance (31) Parity Securities bonds or securities payable from the Pledged Revenues equally or on a parity with the Bonds (32) Paying Agent First Interstate Bank of Fort Collins, N A , Fort Collins, Colorado , which is the agent of the City for the payment of the Bonds (33) Person not only a natural person, corporation, or other legal entity, but also two or more natural persons, corporations , or other legal entities acting 3ointly as a firm, partnership, unincorporated association, 3oint ventures or otherwise (34) Pledged Revenues all or a portion of the Income The term indicates a source of revenues and does not necessarily indicate all or any portion or other part of such revenues in the absence of further qualification -11- (35) Principal and Interest Fund the special fund created by and designated in Ordinance No. 9, 1975, of the City as the "City of Fort Collins Sewer Refunding Revenue Bonds, Series 1975, Bond Fund" and referred to in Section 5E hereof (36) Prior Parity Bonds those securities issued pursuant to Ordinance No. 9, 1975, of the City and designated as the "City of Fort Collins Sewer Refunding Revenue Bonds , Series 1975, " dated March 1 , 1975, in the aggregate principal amount of $3 , 155, 000, having a lien on the Pledged Revenues equal to and on a parity with the lien thereon of the Bonds (37) Pro]ect that portion of the Sewerage Facilities for the Acquisition of which the Bonds are issued hereunder, whether such Acquisition is undertaken at one time or in stages (38) Purchaser Boettcher & Company, Denver, Colorado, and its associates, if any. (39) 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 authorized by the City, or otherwise fixed and designated by the City (40) Redemption Price when used with respect to a Bond or other designated security payable from the Pledged Revenues , the principal amount thereof plus the applicable premium, if any, payable upon the redemption thereof prior -12- to the stated maturity date of such Bond or other security on a Redemption Date in the manner contemplated in accordance with the terms of the Bond or other security (41) security or securities when used with reference to securities of the City, any bonds, certificates, notes, debentures, temporary bonds or other obligations of the City issued by the City, or any other evidence of the advancement of money to the City, as authorized by the Act or other applicable State law ana approved by the Council (42) Sewer Depreciation and Capital Improvements Fund the special fund created by the Charter of the City and referred to in Section 5I hereof (43) Sewer Fund the special fund created by Ordinance No 67, 1974 , of the City and referred to in Section 5C hereof (44) Sewerage Facilities any one or more of the various devices used in the collection, treatment, or disposition of sewage and industrial wastes of a liquid nature , including , without limitation, all inlets , collection, drainage , or disposal lines, intercepting sewers , sewage disposal plants , outfall sewers , sewage lagoons, all pumping , power , and other equipment and appurtenances , all extensions , improvements, remodeling, additions and alterations thereof, any and all rights or interests for such sewerage facilities , and all other necessary, incidental, or appurtenant properties, equipment, -13- and facilities relating to the foregoing and any such devices which may be Sewerage Facilities under the Act (45) State the State of Colorado (46) Subordinate Bonds or Subordinate Securities bonds or securities payable from the Pledged Revenues having a lien thereon subordinate or 3unior to the lien thereon of the Bonas (47) Trust Bank a Commercial Bank which is authorizes 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 include the plural, and woras 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, correspona 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 -14- Section 2. Necessity, Authority for Bonds. A Necessity The City has need for and desires to Acquire the Project for the benefit of the public health of its inhabitants. B Authority For Bonds The Council of the City is authorized by the Act to issue bonds in anticipation of the collection of revenues of sewerage facilities to pay the cost thereof The Council has determined and hereby determines that all limitations imposed by the Act upon the issuance of the Bonds have been duly and completely met and satisfied Section 3 The Bonds A Authorization The City of Fort Collins, Colorado, Sewer Revenue Bonds, Series 1982 , dated October 1, 1982, in the aggregate principal amount of $2 , 200, 000, payable as to all Debt Service Requirements solely out of Net Pledged Revenues are hereby authorized to be issued , pursuant to the Act and the terms of this Ordinance, and the City pledges irrevocably, but not necessarily exclusively, the Net Pledged Revenues to the payment of the Debt Service Requirements for the Bonds, the proceeas of the Bonds to be used solely to defray the Cost of the Project B Bond Details (1) Generally The Bonds shall be issued payable to bearer , dated as of October 1, 1982, consisting of 440 Bonds in the cenomination of $5, 000 each numbered consecutively in regular numerical order from 1 through 440 -15- Y The Bonds shall bear one set of interest coupons evidencing interest t -ereon from October 1, 1982, to their respective maturity dates , except if redeemed prior thereto, at the per annum rates of interest stated below The coupon interest shall be payable April 1 , 1983, and semiannually thereafter on the lst day of October and the 1st day of April of each year If upon presentation at maturity payment of any Bond is not made as herein provided, interest shall continue thereon at the coupon interest rate specified in the Bond until the principal thereof is paid in full The Bonds shall be numbered, shall mature on the 1st day of October in the principal amounts and years and shall bear per annum interest at the rates shown in the following schedule Bonds Numbered Principal Per Annum Coupon (both inclusive) Amounts Years Interest Rates 1 to 25 $125,000 1984 12 00% 26 to 50 125, 000 1985 12 00% 51 to 75 125,000 1986 12 00% 76 to 100 125, 000 1987 10 00% 101 to 125 125,000 1988 10 00% 126 to 150 125, 000 1989 10 00% 151 to 175 125,000 1990 10 00% 176 to 200 125, 000 1991 9 60% 201 to 225 125,000 1992 9 75% 226 to 250 125, 000 1993 9 90% 251 to 275 125 ,000 1994 10 00% 276 to 300 125, 000 1995 10 15% 301 to 320 100 ,000 1996 10 30% 321 to 340 100, 000 1997 10 45% 341 to 360 100 ,000 1998 10 60% 361 to 380 100, 000 1999 10 70% 381 to 400 100 ,000 2000 10 80% 401 to 420 100, 000 2001 10 90% 421 to 440 100 ,000 2002 11 00% The Debt Service Requirements of the Bonds are payable in lawful money of the United States of America, without deduction -16- for exchange or collection charges, upon presentation and surrender of the Bonds and the interest coupons as they severally become due , at the principal corporate trust offices of the Paying Agent (2) Redemption of Bonds Prior to Maturity Bonds maturing on or before October 1, 1997 , shall not be redeemable prior to their respective maturity dates Bonds maturing on or after October 1, 1998 , shall be redeemable prior to their respective maturity dates, at the option of the City, in whole or in part, in inverse numerical order , on October 1, 1997, 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 Notice of any redemption shall be given by the Clerk in the name of the City ( 1) Publication By publication of such notice at least one (1) time by one (1) publication, such publication being not less than thirty (30) days prior to the Redemption Date specified in such notice in The Coloradoan, Fort Collins, Colorado, if then in business and publishing, and if not, then in a newspaper of general circulation in the City, and (ii) Mail By sending a copy of such notice by certified or registered , first-class , postage prepaid mail , at least thirty (30) days prior to the Redemption Date, to the Purchaser and to the Holders of each of the Bonds being redeemed, if the names and addresses of the Holders and the numbers of their Bonds are recorded with the Clerk For this -17- purpose , the Holder of any such Bond may at any time furnish his name and adaress and the number or numbers of his Bond or Bonds to the Clerk Such notice shall specify the number or numbers of the Bonds so to be redeemed and the date fixed for redemption, and shall further state that on the Redemption Date there will become and will be due and payable upon each Bond so to be redeemea at the principal corporate trust office of the Paying Agent the principal amount thereof, accrued interest on the principal amount of each Bond to the Redemption Date, ana any premiums payable on prior redemption, ana that from and after such date interest will cease to accrue Any Bonds redeemed prior to their maturity by call for prior redemption or otherwise shall not be reissued and shall be cancelled the same as Bonds paid at or after maturity (3) Negotiable Instruments Title to any Bond or to any coupon shall pass by delivery merely, as a negotiable instrument payable to bearer SubDect to the provisions expressly made or necessarily implied herein, the Bonas and the coupons pertaining thereto shall be fully negotiable and shall have all the qualities of negotiable paper within the meaning and for all the purposes of investment securities under the provisions of part 1 of article 8 of title 4 , Colorado Revised Statutes 1973, as amended , the Uniform Commercial Code--Investment Securities, and each Holder or Holders of the Bonds, by accepting the same, shall be conclusively deemed to have agreed that the Bonds, except as otherwise provided, are and shall be fully negotiable -18- r within the meaning and for all purposes of investment securities pursuant to said statute ' (4) Interest Rates The maximum net effective interest rate authorized for the Bonds is 15% per annum, and the actual net effective interest rate for the Bonds is 10 43147% per annum (5) Execution and Delivery. The Bonds shall be executed by and on behalf of the City with the facsimile signature of the Mayor , shall bear a facsimile of the seal of the City, shall be attested with the facsimile signature of the Clerk, and shall be countersigned with the manual signature of the Finance Director, and each of the Bonds shall have attached thereto coupons bearing the facsimile signature of the Mayor, securing the payment of the interest accruing thereon as it becomes due Should any officer whose manual or facsimile signature appears on the Bonds or the coupons attached thereto cease to be such officer before delivery of the Bonds to the Purchaser, such manual or facsimile signature shall nevertheless be valid and sufficient for all purposes The Mayor , the Clerk, and the Finance Director are hereby authorized and directed to prepare and to execute the Bonds as herein provided When the Bonds have been duly executed, the officers of the City are authorized to, and shall, deliver the Bonds to the Purchaser on receipt of the agreed purchase price (6) Lost, Destroyed or Taken Bonds If any Outstanding Bond or coupon shall become lost, apparently destroyed, or wrongfully taken, it may be reissued in the form and tenor of -19- the lost , destroyed or wrongfully taken Bond or coupon upon the owner ' s furnishing, to the satisfaction of the Council (a) proof of ownership, (b) proof of loss or destruction, (c) a surety bond in twice the amount of the securities in question, including any unmatured coupons appertaining thereto, and (d) payment of the cost of preparing and issuing the new security. Nothing contained in the provisions of this paragraph prohibits the City from reissuing , upon such terms and conditions as the Council may determine, and provided that such terms and conditions are not otherwise contrary to the provisions of this Ordinance or the requirements of law, any Outstanding Bond or coupon which shall not have become lost, apparently destroyed , or wrongfully taken (7) Recitals in Bonds Each Bond shall recite in substance that the Bond is payable solely from the Net Pledged Revenues and that Bond aoes not constitute a debt of the City within the meaning of any constitutional or statutory limitation Each Bond shall further recite that it is issued under the authority of the Act and this Ordinance Such recital shall conclusively impart full compliance with all of the provisions of the Act, and all Bonas issued containing such recital shall be incontestable for any cause whatsoever after their delivery for value (8) Form of Bonas and Coupons Sub)ect to the provisions of this Ordinance , each Bond , and the coupons to be attached thereto , shall be in substantially the following form, with such omissions, insertions, endorsements , and variations as to -20- recitals of fact or other provisions as may be required by the circumstances or required or permitted by this Ordinance, and as may be necessary or appropriate to conform to the rules and requirements of any governmental authority or to any usage or requirement of law with respect thereto -21- (Form of Bond) UNITED STATES OF AMERICA STATE OF COLORADO COUNTY OF LARIMER CITY OF FORT COLLINS SEWER REVENUE BOND SERIES 1982 No $5 , 000 The City of Fort Collins, in the County of Larimer and State of Colorado (the City) , for value received , hereby promises to pay to the bearer hereof, solely from the special funds provided therefor , as hereinafter set forth, on the lst day of October , the principal pum of FIVE THOUSAND DOLLARS and to pay solely from said special funds interest thereon as evidenced by interest coupons hereto attached, at the rate of and hundredths per centum (_ _% ) per annum from October 1, 1982, to the maturity date of this Bond, except if redeemed prior thereto, payable April 1, 1983, and semiannually thereafter on the 1st day of October and the 1st day of April of each year, upon presentation and surrender of this Bond and said coupons as they severally become due If upon presentation at maturity payment of this Bond is not made as herein provided , interest shall continue at the coupon interest rate specified herein until the principal hereof is paid in full. The principal of and interest on this Bond (the Debt Service Requirements) are payable in lawful money of the United States -22- of America, without deduction for exchange or collection charges, out of the special funds hereinafter specified, but not otherwise, at the principal corporate trust offices of First Interstate Bank of Fort Collins, N.A. , Fort Collins, Colorado (the Paying Agent) , upon presentation and surrender of said coupons and this Bond as they severally become due Bonds of this issue maturing on or before October 1, 1997, are not redeemable prior to their respective maturity dates. Bonds of this issue maturing on or after October 1, 1998, are redeemable prior to their respective maturity dates, at the option of the City, in whole or in part, in inverse numerical order , on October 1, 1997, and on any interest payment date thereafter , at a price equal to the principal amount thereof plus accrued interest thereon to the Redemption Date Redemption shall be made upon not less than thirty (30) days ' prior notice by publication of such notice at least one (1) time by one (1) publication, such publication being not less than thirty (30) days prior to the Redemption Date specified in such notice , in The Coloradoan, Fort Collins, Colorado, if then in business and publishing , and if not, then in a newspaper of general circulation in the City , and by sending a copy of such notice by certified or registered, first-class postage prepaid mail, at least thirty (30) days prior to the Redemption Date specified in such notice to Boettcher & Company, Denver, Colorado, and to the holders of each of the Bonds being redeemed, if the names and addresses of the holders and the numbers of their Bonds are recorded with the City Clerk For -23- this purpose , the holder of any such Bond may at any time furnish his name and address and the number or numbers of his Bond or Bonds to the City Clerk If this Bond shall have been duly called for redemption and if on or before the Redemption Date there shall have been deposited with the Paying Agent funds sufficient to pay this Bond on the Redemption Date , then this Bond shall become due and payable upon such Redemption Date, and interest shall cease to accrue hereon after the Redemption Date This Bond and the Bonds of the series of which this is one are special and limited obligations of the City payable solely out of and secured by an irrevocable pledge of the Net Pledged Revenues derived and to be derived from the use and operation of and otherwise pertaining to the Sewerage Facilities of the City, for the cost of a portion of which this Bond is issued, as more specifically provided in an ordinance of the the City (the Ordinance) authorizing the issuance of this Bond This bond and the interest coupons appurtenant hereto do not constitute a debt or an indebtedness of the City within the meaning of any constitutional or statutory provision or limitation of the State of Colorado Pavment of the Debt Service Requirements of this Bond shall be made solely from, and as security for such payment there are irrevocably (but not exclusively) pledged , pursuant to the Ordinance, two special funas thereby created and identified as the Principal and Interest Fund and the Debt Service Reserve Fund , into which funds the City has covenanted in the Ordinance to pay, respectively , from certain revenues derived from the -24- operation and use of and otherwise pertaining to the Sewerage Facilities (the Income) , after provision is mane only for the payment of all necessary and reasonable current operation and maintenance expenses, paid or accrued, of operating , maintaining and repairing the Sewerage Facilities (such remaining revenues being the Net Pledged Revenues) , sums sufficient to pay when due the Debt Service Requirements of the Bonds of the series of which this is one and any prior or additional parity securities heretofore or hereafter issued and payable from such revenues, and to accumulate and maintain a specified reserve for such purposes In aadition, the City may at its option augment sucn funds with any other moneys of the City legally available for expenditure for the purposes thereof as provided in the Ordinance It is hereby recited, certified and warranted that for the payment of this Bond and of the interest hereon, the City has created and will maintain said special funds and will deposit therein, out of the Net Pledged Revenues, the amounts and revenues specified in the Ordinance and out of said special funds, as an irrevocable charge thereon, will pay this Bond and the interest hereon, in the manner proviaed by the Ordinance The Bonds of the series of which this is one are equitably and ratably secured by a lien on the Net Pledged Revenues, and such Bonds constitute an irrevocable and first lien (but not necessarily an exclusive first lien) upon the Net Pledged Revenues Bonds and other types of securities, in addition to the Bonds of the series of which this is one , subDect to -25- expressed conditions, may be issued and made payable from the Net Pledged Revenues having a lien thereon subordinate and junior to the lien of the Bonds of the series of which this is one 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 The City covenants and agrees with the holder of this Bond and with each and every person who may become the holder hereof that it will keep and will perform all of the covenants of this Bond and of the Ordinance The Bond is one of a serifs of 440 Bonds in the aggregate principal amount of $2 ,200, 000, of like tenor and date, except as to number and interest rate, authorizes and issued for the purpose of defraying the cost of acquiring certain Sewerage Facilities, under the authority of and in full conformity with the Constitution and all other laws of the State of Colorado thereunto enabling , and pursuant to the Ordinance duly ddoptes prior to the issuance of this Bond This Bond is issued under the authority of part 4 of article 35 of title 31 , Colorado Revised Statutes 1973, as amender , and this recital conclusively imparts full compliance with all of the provisions of said statute 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 of the series of which this is one are issued and secured , including , without limitation, the nature and extent of the security for -26- . 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 pledgea to the payment of the Debt Service Requirements of the Bonas, the terms and conditions on which the Bonds are issued , a description of the special funds referred to above and the nature and extent of the security and pledge afforded thereby for the payment of the Debt Service Requirements, 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 holders of the Bonds To the extent and in the respects permittea by the Orainance , 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 Bonas upon the making of provision for the payment of the Bonds on the terms and conaitions 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, -27- including the home rule charter of the City, and with the Ordinance and any instrument supplemental thereto, that this Bond does not contravene any constitutional, charter or statutory limitation of the State of Colorado, and that this Bond and each of the other Bonds of the series of which this is one are issued under the authority of the Ordinance. For the payment of this Bond and the interest hereon, the City pledges the exercise of all its lawful corporate powers IN WITNESS WdEREOF, the Council of the City of Fort Collins, Colorado, has caused this Bond to be executed in its name and on its behalf with the facsimile signature of the Mayor of the City, to be sealed with the facsimile seal of the City, to be signed and attested with the facsimile signature of the City Clerk of the City, and to be countersigned with the manual signature of the Finance Director of the City, and has caused the attached coupons to be signed with the facsimile signature of the Mayor of the City, all as of the lst day of October , 1982 CITY OF FORT COLLINS, COLORADO (FACSIMILE) By (Facsimile Signature) ( SEAL ) Mayor ATTEST (Facsimile Signature) City Clerk Countersigned (Manual Signature) Finance Director (End of Form of Bond) -28- (Form of Interest Coupon) Coupon No $ April On the first day of October, , unless the Bond to which this coupon is attached has been called for prior redemption, the City of Fort Collins, in the County of Larimer and State of Colorado, will upon surrender of this coupon pay to bearer the amount shown hereon in lawful money of the United States of America , without deduction for exchange or collection charges, at the principal corporate trust offices of First Interstate Bank of Fort Collins , N A , Fort Collins, Colorado, solely from and secured by a pleage of two special funas, created from the Net Pledged Revenues derived from the operation and use of and otherwise pertaining to the Sewerage Facilities of the City, as more fully provided in the Bond to which this coupon pertains, being the interest then due on its City of Fort Collins, Colorado , Sewer Revenue Bond , Series 1982, dated October 1, 1982, bearing Bond No (Facsimile Signature) Mayor City of Fort Collins, Colorado (End of Form of Interest Coupon) -29- 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 Holders of any and all of the Bonds and the coupons pertaining thereto, 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 or coupons 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 and collectible solely out of the Net Pledged Revenues, which Net Pledged Rev- enues are hereby so pledged for that purpose , the holder or Holders of any of the Bonds or coupons may not look to any gen- eral or other fund of the City for the payment of the Debt Service Requirements, except the special funds pledged therefor , the Bonds ana coupons appertaining thereto shall not constitute a debt or inaebtedness of the City within the meaning of any constitutional, charter or statutory provision or limitation of the State, ana the Bonds and coupons shall not be considered or hela to be general obligations of the City but shall constitute the special ana limited obligations of the City The Bonds are not payable in whole or in part from the proceeds of general property taxes, and the full faith and credit of the City is not pledged for payment of the Bonas or their coupons -30- Section 4 Sale of Bonds. A Necessity of Project and Issuance of Bonds It is necessary and for the best interests of the City and the inhabitants thereof that the City Acquire the Project and defray all or a portion of the Cost of the Project by issuing the Bonds. B Bond Purchase Agreement, Award of Sale The Purchaser has offered to purchase the Bonds in accordance with the terms of this Ordinance pursuant to a Bond Purchase Agreement The sale of the Bonds to the Purchaser is hereby awarded, and the Bond Purchase Agreement is hereby approved Section 5 Funds and Accounts Adopted or Created by Ordinance A Disposition of Bond Proceeds and Other Revenues, Security For Bonds The proceeds from the sale of the Bonds and the Pledged Revenues 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. The validity of the Bonds shall not be dependent on nor be affected by the validity or regularity of any proceedings relating to the Project or any part thereof The Purchaser of the Bonds, any associate thereof, and any subsequent Holder of any Bonds shall in no manner 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 -31- Until the proceeds of the Bonds are applied as provided in this Section 5 and used to defray the Cost of the Project from time to time , the proceeds of the Bonds shall be subject to a lien thereon and pledge thereof for the benefit of the Holaers of the Bonds from time to time as provided in this Section 5 The Pledged Revenues, and all moneys and securities paid or to be paia to or held or to be held in any fund or account hereunder , are hereby pledged to secure the payment of the Debt Service Requirements of the Bonds, subject to the provisions herein relating to the Capital Projects Fund and subject to the application of the Pledged Revenues for the payment of Debt Service Requirements of Parity Securities, and this 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 pledged , shall immediately be subject to the lien of this pledge without any physical delivery thereof , any filing, or further act, and the lien of this pledge ano the obligation to perform the contractual provisions hereby mace shall have priority over any or all other obligations ano liabilities of the City (except as herein otherwise expressly provided) , and the lien of this 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 B Capital Pro]ects Fund The proceeds of the Bonds, except the sums requirea in Section 5E and 5F hereof to be -32- deposited in the Principal and Interest Fund and the Debt Service Reserve Fund, shall be deposited in the Capital Projects Fund and shall be maintained in a separate special account therein and used and withdrawn only as provided in this Section 5B The proceeds of the Bonds so deposited in the Capital Projects Fund , except as herein otherwise expressly provided, shall be used and paid out from time to time solely for the purpose of paying the Cost of the Project and are pleaged therefor Any such proceeds remaining in the Capital Projects Fund after completion of the Acquisition of the Project shall be deposited in the Principal and Interest Funa and used for the purposes of the Principal and Interest Fund or shall be used to the extent feasible to call and redeem the Bonds in aavance of maturity The City shall use any proceeos of the Bonas creaited to the Capital Projects Fund, without further order, to pay the Debt Service Requirements of the Bonds as the same become due whenever and to the extent moneys in the Principal and Interest Fund and the Debt Service Reserve Fund or moneys otherwise available therefor are insufficient for that purpose, unless such proceeds shall be needed to aefray obligations accrued and to accrue under any contracts then existing and pertaining to the Project Any moneys so used shall be restored to the Capital Projects Fund from the first Pledged Revenues thereafter received and not needed to meet the requirements provided in Sections 5E and 5F hereof -33- C Sewer Fund Except as otherwise provided herein, the entire Income, upon receipt thereof from time to time by the City , shall be set aside and credited immediately to the Sewer Fund In addition, the City may at its option credit to the Sewer Fund any other moneys of the City legally available for eypenditure for the purposes of the Sewer Fund as provided herein The Sewer Fund shall be administered and the moneys on deposit therein shall be deposited and applied in the following order of priority (1) First, to the Operation and Maintenance Fund to pay Operation and Maintenance Expenses in the manner set forth in Section 5D, (2) Second, to the Principal and Interest Fund to pay the Debt Service Requirements of the Bonds , the Prior Parity Bonds, Additional Parity Bonds and any other additional Parity Securities then Outstanding in the manner set forth in Section 5E , (3) Third , to the Debt Service Reserve Fund, in the manner set forth in Section 5F, (4) Fourth, to the payment of the Debt Service Requirements of Subordinate Bonds or other Subordinate Securities in accordance with Section 5H, (5) Fifth, to the Sewer Depreciation and Capital Improvements Fund , in the manner set forth in Section 5I , and (6) Sixth, to be used in accordance with Section 5J -34- D Operation and Maintenance Fund. As a first charge on the Sewer Fund , there shall be credited from time to time within each Fiscal Year , to the Operation and Maintenance Fund , moneys sufficient to pay the Operation and Maintenance Expenses of the Sewerage Facilities as they become due and payable , and thereupon the Operation and Maintenance Expenses shall be promptly paid Any surplus remaining in the Operation and Maintenance Fund at the end of the Fiscal Year and not needed for Operation and Maintenance Expenses , shall be transferred to the Sewer Fund and used for the purposes thereof E Principal and Interest Fund The City shall deposit in the Principal and Interest Fund , forthwith upon receipt of the proceeds of the Bonds, interest accrued thereon from their date to the date of delivery thereof to the Purchaser, to apply to the payment of interest on the Bonds as the same becomes due after their delivery SubDect to the payments required by Section 5D, from any moneys remaining in the Sewer Fund , there shall be credited to the Principal and Interest Fund the following (1) Interest Payments Monthly, commencing November 1, 1982, and amount equal to one-sixth of the next maturing installment of interest on the Prior Parity Bonds and the Bonds and such amounts for interest on any Additional Parity Bonds and any other Parity Securities then Outstanding as the ordinances authorizing the issuance thereof shall provide, to the extent that other funds are not on deposit therein and available -35- therefor, so that there are moneys therein sufficient to pay such interest when due, and (2) Principal Payments Monthly, commencing November 1, 1982, an amount equal to one-sixth of the next maturing installment of principal of the Prior Parity Bonds, an amount equal to one-twelfth of the next maturing installment of principal of the Bonds and such amounts for principal on any Additional Parity Bonds and any other Parity Securities then Outstanding as the ordinances authorizing the issuance thereof shall provide , to the extent that other funds are not on deposit therein and available therefor , so that there are moneys therein sufficient to pay such principal when due The moneys credited to the Principal and Interest Fund shall be used to pay the Debt Service Requirements of the Prior Parity Bonas, the Bonas, any Additional Parity Bonds and any other Parity Securities then Outstanding , promptly as such Debt Service Requirements become due , except as otherwise provided in Sections 5G and 9 hereof F Debt Service Reserve Fund The City shall deposit in the Debt Service Reserve Fund , from the proceeas of the Bonds, forthwith upon receipt thereof, the sum of $330, 000 Said sum and any other moneys required to be deposited in the Debt Service Reserve Fund shall be set aside, accumulated and , if necessary, reaccumulated from time to time , and maintained as a continuing reserve to be used , except as hereinafter provided in this Section 5F and Sections 5G and 9 hereof , only to prevent deficiencies in payment of the Debt Service Requirements of the -36- Prior Parity Bonas , the Bonds, any Additional Parity Bonds and any other Parity Securities then Outstanding resulting from failure to deposit into the Principal and Interest Fund sufficient funds to pay such Debt Service Requirements as the same accrue If at any time the City shall for any reason fail to pay into the Principal and Interest Fund the full amount above stipulated, then an amount shall be paid into the Principal ana Interest Fund at such time from the Debt Service Reserve Fund equal to the difference between that paid from the Sewer Fund and the full amount so stipulates The money so used shall be replaced to the Debt Service Reserve Fund from the first moneys credited to the Sewer Fund thereafter received and not requirea to be otherwise applied by Sections 5D and 5E hereof If Additional Bonds or other Parity Securities (other than the Bonds) are Outstanaing and the ordinances authorizing the issuance of those securities require the replacement of moneys in a reserve account therefor, then the moneys replaced in the Debt Service Reserve Fund shall be replaced on a pro rata basis based upon the principal amount of the then Outstanding Bonds and the total principal amount of the then Outstanding Prior Parity Bonas, Aaditional Parity Bonas or other Parity Securities , including the Bonds , as moneys become available therefor If at any time the City shall for any reason fail to pay into the Debt Service Reserve Fund the full amount stipulated herein from the moneys credited to the Sewer Funa, the -37- difference between the amount paid and the amount so stipulated shall in a like manner be paid therein from the first moneys credited to the Sewer Fund thereafter received and not required to be applied otherwise by Sections 5D and 5E hereof G Termination of Deposits , Use of Moneys in Principal and Interest Fund and Debt Service Reserve Fund No payment need be made into the Principal and Interest Fund or the Debt Service Reserve Fund , or both, if the amount in the Principal and Interest Fund and the amount in the Debt Service Reserve Fund total a sum at least equal to the entire amount of the Outstanding Prior Parity Bonds, the Outstanding Bonds and any Outstanaing Additional Parity Bonds and Parity Securities, as to all Debt Service Requirements, to their respective maturities 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 Prior Parity Bonds, any Bonds, any Additional Parity Bonds and any other Parity Securities, then Outstanding and thereafter maturing , both accrued and not accrued (provided that, solely for the purpose of this Section 5G, there shall be deemed to be a credit to the Debt Service Reserve Fund of moneys, Federal Securities and bank deposits, or any combination thereof, accounted for in any other fund or account of the City and restricted solely for the purpose of paying the Debt Service Requirements) , in which case moneys in the Principal and Interest Fund and the Debt Service Reserve Fund in an amount, except for any known interest or other gain to accrue from any -38- 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 usea 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 Fund and the Debt Service Reserve Funa and any other moneys derived from the Pledgea Revenues or otherwise pertaining to the Sewerage Facilities may be used in any lawful manner determined by the City The moneys in the Principal and Interest Funo and in the Debt Service Reserve Fund shall be used solely and only for the purpose of paying the Debt Service Requirements of the Prior Parity Bonds, the Bonds, any Additional Parity Bonds and any other Parity Securities hereafter authorized and Outstanding from time to time , but any moneys at any time in excess of the minimum amount required to be maintained in the Debt Service Reserve Fund may be withdrawn therefrom, and transferred from time to time to the Sewer Fund ana distributed in the same manner as other moneys in the Sewer Fund H Pavment of Additional Subordinate Securities Subsecuent to fully providing for the payments required to be mace by Sections 5A through 5F hereof for a given Fiscal Year , any moneys remaining in the Sewer Fund for such Fiscal Year may be used by the City for the payment of Debt Service Requirements -39- of additional Subordinate Securities payable from the Pledgea Revenues and hereafter authorized to be issued in accoraance with this Ordinance and any other provisions herein supplemental thereto, including reasonable reserves for such Subordinate Securities, as the same accrue, 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 Prior Parity Bonds, the Bonds, any Additional Parity Bonds and any other additional Parity Securities as herein provided (Any Additional Parity Bonds or other additional Parity Securities , but not any Subordinate Bonds or Subordinate Securities, shall be payable from the Principal and Interest Fund and the Debt Service Reserve Fund pursuant to Sections 5E through 5G hereof. ) I Sewer Depreciation ana Capital Improvements Fund SubDect to the payments required by Sections 5D through 5H, there shall be deposited in the Sewer Depreciation and Capital Improvements Fund any moneys remaining in the Sewer Fund at the end of each Fiscal Year The moneys in the Sewer Depreciation ana Capital Improvements Fund shall be set aside, accumulatea , ana , if necessary , reaccumulated from time to time, and maintained for the purpose of paying the costs of required renewals, replacements, extraordinary repairs , extensions, improvements, enlargements, and betterments to the Sewerage Facilities Moneys in excess of those required to be maintained in the Sewer Depreciation and Capital Improvements Fund may be -40- withdrawn therefrom and transferred to the Sewer Fund and distributed in the manner provided in Section 5J J Use of Remaining Revenues After the payments required to be maae by Sections 5A through 5I hereof are made , at the end of any Fiscal Year , or whenever in any Fiscal Year there shall have been credited to the Principal and Interest Fund , the Debt Service Reserve Fund , and the Sewer Depreciation ana Capital Improvements Fund all amounts required to be deposited in those special funds at that time , as herein provided, any remaining moneys credited to the Sewer Fund may be used for any one or any combination of lawful purposes as the City may from time to time determine K Budget and Appropriation of Sums The sums proviaed to make the payments specified in this Section 5 are hereby appropriated for said purposes, and said amounts for each year shall be include❑ in the annual budget and the appropriation ordinance or measures to be adopted or passed by the Council in each year respectively while any of the Bonds, either as to principal or interest, are Outstanding and unpaia No provisions of any constitution, 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 purpose to the Sewer Fund for the purposes thereof -41- Section 6 General Administration of Funds A Places and Times of Deposits. Each of the special funds created or adopted in Section 5 hereof shall be maintained in a Commercial Bank 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 herein prevents the commingling of moneys accounted for in any two or more such accounts or funds pertaining to the Pledged Revenues Such accounts or funds shall be continuously secured to the fullest extent required or permitted by the laws of the State for the securing of public funas and shall be irrevocable and not withdrawable by anyone for any purpose other than the respective designated purposes of such accounts or funds Each periodic payment shall be credited to the proper account or fund 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 Any moneys in any fund established in Section 5 hereof may be deposited, invested , or reinvested in any manner permitted by law Securities or obligations purchased as such an investment shall either be sub3ect to reaemption at any time at face value by the holder thereof at the option of such holder , or shall mature at such time or times as shall most nearly coincide with the expected need for moneys from the fund in question Securities or obligations so purchased as an investment of moneys in any such -42- fund shall be deemed at all times to be a part of the applicable fund , provided that the interest accruing on such investments and any profit realized therefrom shall be credited to the Sewer Fund , and any loss resulting from such investments shall be charged to the particular fund in question 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 whenever it shall be necessary to do so in order to provide moneys to meet any required payment or transfer from such fund The City shall not invest any moneys accounted for hereunder if any such investment would contravene the covenant concerning arbitrage in Section 8U hereof C No Liabilitv 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 kith this Ordinance D Character of Funds The moneys in any funa herein authorized shall consist of lawful money of the United States or investments permitted by Section 6B hereof or both such money and such investments Moneys deposited in a demand or time deposit account in or evidenced by a certificate of deposit of a Commercial Bank pursuant to Sections 6A and 6B hereof, appropriately secured according to the laws of the state, shall be deemed lawful money of the United States E Accelerated Payments Optional Nothing contained herein prevents the accumulation in any fund herein designated -43- 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 Pleaged Revenues Nothing herein contained requires in connection with the Pledged Revenues received in any Fiscal Year the accumulation in any fund or account for the payment in the Comparable Bond Year of Debt Service Requirements due in connection with any series of bonds or other securities payable from the Pleaged Revenues and heretofore, herein or hereafter authorized , in excess of such Debt Service Requirements due in such Comparable Bond Year , or in excess of any reserves required to be accumulated and maintained therefor, and of any existing deficiencies, and payable from such fund or account , as the case may be , except as may be otherwise proviaed herein Section 7 Priorities, Liens , Issuance of Additional Bonas A First Lien on Pledged Revenues , Eauality of Bonds Except as expressly providea in this Ordinance with respect to the Prior Parity Bonos, Aaditional Parity Bonds , Parity Securities and Suborcinate Securities, the Pledged Revenues shall be and hereby are irrevocably pledged and set aside to pay the Debt Service Requirements of the Bonds The Bonas constitute an irrevocable and first lien (but not necessarily an exclusive first lien) upon the Pledged Revenues Tie Prior Parity Bonds , the Bonds , any Additional Parity Bonas and any other Parity Securities hereafter authorized to be -44- issued and from time to time Outstanding are equitably and ratably secured by a lien on the Pledged Revenues ana snall 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 thereof , it being the intention of the Council that there shall be no priority among the Prior Parity Bonds , the Bonas, any Additional Parity Bonds and any other Parity Securities, regardless of the fact that they may be actually issuea and delivered at different times B Issuance of Parity Securities Nothing herein, sub3ect to the limitations statea in Sections 7G and 7H hereof, prevents the issuance by the City of Additional Parity Bonds or other additional Parity Securities payable from the Pleaged Revenues and constituting a lien on the Pleaged Revenues on a parity with, but not prior or superior to, the lien thereon of the Bonds, or prevents the issuance of bonds or other securities refunding all or a part of the Bonds , except as proviaed in Sections 7F and 7H hereof, but before any such Additional Parity Bonds or other additional Parity Securities are authorized or actually issued (exluding (i) any parity refunding securities refunding the Bonas, (11) any Parity Securities refunding Additional Parity Bonds, or additional Parity Securities, and (iii) any Suborainate Securities as permitted in Section 7D hereof) the following provisions must first be satisfiea (1) Absence of Default At the time of the delivery of and payment for the Additional Parity Bonas as provided in Section 7H hereof , the City shall not be in default in making any -45- payments required by Section 5 hereof Such absence of default shall be certified in writing by the Director of Finance (2) Historic Revenues Test As certified by the Director of Finance , either (1) the Net Pledged Revenues derived in the last complete Fiscal Year immediately preceding the date of the issuance of such Additional Parity Bonds or other Parity Securities , or (11) the Net Pledged Revenues aerived in the period of twelve (12) consecutive and complete calenaar months enaing not later than the second calendar month prior to the month of issuance of Additional Parity Bonds or other Parity Securities and ending not earlier than the end of the last preceding Fiscal Year , shall have been sufficient to pay an amount at least equal to 120% of the Maximum Annual Debt Service Requirements for all Outstanding Prior Parity Bonds and Bonds (3) Propected Revenues Test As estimated by a competent feasibility and rate engineer, either (i) the Pledged Revenues expected to be derived in the next complete Fiscal Year immediately succeeding the date of the completion of the facilities to be financed with the proceeds of such Additional Parity Bonas or other Parity Securities, or (ii) the Pleaged Revenues expected to be derived in the period of twelve (12) consecutive and complete calendar months beginning not later than the second calendar month immeaiately succeeding the date of the completion of the facilities to be financed with the proceeds of sucn Additional Parity Bonds or other Parity Securities shall be sufficient to pay an amount at least equal to the estimated Operation and Maintenance Expenses for the -46- Sewerage Facilities for such period plus 120% of the Maximum Annual Debt Service Requirements for all Outstanding Prior Parity Bonds, Bonds, Additional Parity Bonds or other Parity Securities and the Additional Parity Bonds or other Parity Securities proposed to be issued (4) Adjustment of Pledged Revenues In the computations of the historic and projected revenues tests in Section 7B (2) and Section 7B (3) hereof, the amount of the Income for either period shall be decreased and may be increased by the amount of loss or gain, which gain or loss results or will result from any change in any schedule of rates, fees, tolls and charges and tap fees constituting Pledged Revenues established during such period (5) Increases in Operation and Maintenance Expenses In determining the amount of Pledged Revenues as set forth in Section 7B (3) hereof , consideration shall be given to any probable increase (but not reduction) in the Operation and Maintenance Expenses of the Sewerage Facilities, as reasonably estimated and certified by the Council, that will result from the expenditure of the proceeds of the proposed Additional Parity Bonds or other Parity Securities or that otherwise are likely to result from other known causes, such as inflation (6) Reduction of Annual Requirements The Maximum Annual Debt Service Requirements (including as such a requirement , the amount of any prior redemption premiums due on any Redemption Date as of which the City shall have exercised or shall have obligated itself to exercise its prior redemption option by a -47- call of bonds for redemption) shall be reduced to the extent that Debt Service Requirements are scheduled to be paid in each of the respective Bond Years with moneys held in trust or in escrow for that purpose by any Trust Bank located within or without the State, including the known minimum yield from any investment of such moneys in Federal Securities and bank deposits, including any certificate of deposit. (7) Authorized Purposes. The Additional Parity Bonds or other additional Parity Securities are issued solely for the purpose of paying the cost of the Project or Improvements to, Equipment of or reconstruction, replacement, repair or other renewal of the Sewerage Facilities C Certification of Revenues In the cases of certification of the absence of default as required by Section 7B (1) hereof and of the computation of the historic and projected revenue tests provided in Sections 7B (2) and 7B (3) hereof, and when adjusted in the manner provided in Sections 7B (4) , 7B (5) and 7B (6) , the specified and required written certifications by the Director of Finance or the competent feasibility and rate engineer that the City is not in default as provided in Section 7B (1) hereof or that such annual revenues are sufficient to pay such amounts as provided in Sections 7B (2) or 7B (3) hereof shall be conclusively presumed to be accurate in determining the right of the City to authorize issue , sell and deliver Additional Parity Bonds or other additional Parity Securities on a parity with the Bonds -48- D Subordinate Securities Permitted Nothing herein, subject to the limitations stated in Sections 7G and 7H hereof, prevents the City from issuing additional bonds or other additional securities for any lawful purpose payable from the Pledged Revenues and having a lien thereon subordinate, inferior and junior to the lien thereon of the Bonds E Superior Securities Prohibited Nothing herein permits the City to issue additional bonds or other additional securities or to enter into any other contract or obligation payable from the Pledged Revenues and having a lien thereon prior and superior to the lien thereon of the Bonds F Refunding Bonds At any time after the Bonds, or any part thereof , are issued and remain Outstanding , if the Council shall find it desirable to refund any Outstanding Bonds, or other Outstanding securities payable from and constituting a lien upon any Pledged Revenues such Bonds, or other securities, or any part thereof, may be refunded regardless of whether the priority of the lien for the payment of the refunding securities on the Pledged Revenues is different from the priority of the lien for the payment of the refunded securities (except as provided in Section 7E hereof) , provided that the issuance of any such refunding bonds or other refunding securities shall be subject to the following additional requirements and conditions (1) Surrender for Payment The Bonds or other securities to be refunded , at the time or times of their required surrender for payment on refunding, shall either then mature or shall be then callable for prior redemption at the City 's option upon -49- proper call, unless the Holder or Holders of all such Bonds or securities consent to such surrender and payment (2) Partial Refundings In the event of a refunding of less than all of the Outstanding Bonds or less than all of the Outstanding securities of a particular issue thereof, the refunding bonds or refunding securities issued pursuant to this Section 7F shall enjoy complete equality of lien upon the Pledged Revenues with the unrefunded portion of the Outstanding Bonds or unrefunded portion of any other Outstanding securities In addition, except as otherwise provided in the ordinance of the Council providing for the issuance of such refunding bonds or securities, the Holders of such refunding bonds or refunding securities shall be subrogated to, have, and enjoy all of the rights and privileges previously hao and enjoyed by the Holder or Holders of the Bonds or securities refunded thereby (3) Limitations Upon Refundings Any refunding bonds or refunding securities payable from any Pledged Revenues shall be issued with such details as the City may by ordinance or other instrument provide, subject to the provisions of Sections 7G ano 7H hereof, and subject to the inclusion of the applicable rights ana privileges oesignated in Section 7F (2) , but without any impairment of any contractual obligation imposed upon the City by any proceedings authorizing the issuance of any unrefunded portion of the Outstanding Bonds or any unrefundeo portion of other Outstanding securities -50- (4) Protection of Bonas or Additional Bonds Not Refunded If only a part of the Outstanding Bonds or other Outstanaing securities of any issue or issues payable from the Pledged Revenues is to be refunded , then such part of said securities may not be refunded without the consent of the Holder or Holders of the unrefunded portion of such securities, unless (a) Requirements Not Increased For the period of time up to and including the last maturity date or last Redemption Date, if any, whichever is later , of the Outstanding unrefunded Bonds or of any Outstanding unrefunded securities, the refunding bonds or refunding securities do not in any Bond Year cause the aggregate principal and interest due on such refunding bonds or refunding securities and the Outstanding unrefunded Bonds and any Outstanding unrefunded securities to exceed the aggregate principal and interest which would have been due in any such Bond Year but for the issuance of the refunding bonds or refunding securities, and unless the lien of the refunding bonds or refunding securities on the Pledged Revenues is not raised to a higher priority than the lien thereon of the Bonds or securites refunded thereby, or (b) Subordinate Lien The lien on any Pledged Revenues for the payment of the refunding bonds or refunding securities is subordinate to each such lien for the payment of any Bonds or securities not refunded, or (c) Default and Coverage Test The refunding bonds or refunding securities are issued in compliance with the Pledged Revenue coverage requirements and the Debt Service Reserve Funa -51- requirements of Section 7B hereof and the requirement of Section 7C hereof with respect to certification of revenues is met, but excluding from any computation thereunder the securities to be refunded and redeemed and which shall forthwith upon the issuance of the refunding securities be no longer Outstanding G Payment Dates of Additional Bonds Any Additional Parity Bonds or Subordinate Bonds or other additional Parity or Subordinate Securities (including , without limitation, any funding or refunding securities) issued in compliance with the terms hereof may bear interest payable seminannually on such days as the Council may dete-cmine, but the first interest payment date may be for interest accruing for any period not in excess in the aggregate of one year , and such additional securities shall mature on such days as the Council may determine during the term of the additional bonds or other additional securities H Supplemental Ordinance Additional bonds or otner additional securities payable from any Pledged Revenues shall be issued only after authorization thereof by ordinance, supplemental ordinance or other instrument of the Council 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 aetermining the date, principal amount, maturity or maturities, designation and numbers thereof, the maximum rate or rates of interest to be borne thereby, any prior redemption privileges of the City with respect thereto, ana -52- other provisions thereof in accordance with this Ordinance All additional securities shall bear such date, shall bear such numbers and series designation, letters or symbols prefixed to their numbers distinguishing them from other securities issued or to to be issued, shall be payable at such place or places, may be subject to redemption prior to maturity on such terms and conditions as may be provided, and shall bear interest at such rate or at such different or varying rates per annum, all as may be fixed by ordinance, instrument or other document of the Council Section 8 Covenants The City hereby particularly covenants and agrees with the Holders of the Bonds and coupons pertaining thereto from time to time, and makes provisions which shall be a part of its contract with such Holders, which covenants and provisions shall be kept by the City continuously until all of the Bonds and the interest thereon, have been fully paid and discharged, to the effect and with the purpose that A Rate Maintenance Covenant The City covenants that is will prescribe, revise, and collect rates , fees, tolls, and charges and tap fees or any combination thereof, which may be imposed by the City whether pursuant to the Act or otherwise, for the direct or indirect connection with, or the use of the Sewerage Facilities, and reasonable penalties for any delinquencies, which shall produce Income sufficient, together with any other moneys legally available therefor and credited to the Sewer Fund, to make the payments and accumulations required -53- by this Ordinance , and which shall produce Net Pledged Revenues sufficient, together with all other moneys legally available therefor and credited to the Sewer Fund after payment of Operation and Maintenance Expenses, to pay an amount at least equal to 120% of the Maximum Annual Service Requirements for the Outstanding Bonds and every other issue of Outstanding Prior Parity Bonds, Additional Parity Bonds or other Parity Securities due in the next ensuing Fiscal Year, plus any amounts required to meet then existing deficiencies pertaining to any account relating to the Pledged Revenues or any securities payable therefrom In the event that such rates, fees, tolls, and charges and tap fees at any time should not be sufficient to make all of the payments ana accumulations required by this Ordinance, the Council will increase its rates, fees, tolls, and charges and tap fees to such extent as to insure the payments and accumulations required by the provisions of this Ordinance B Collection of Charqes The City shall cause all rates, fees, tolls, and charges and tap fees pertaining to the Sewerage Facilities to be billed promptly and collected as soon as reasonable , shall prescribe and enforce rules and regulations or impose contractual obligations for the payment thereof , to the end that the Pledged Revenues shall be adequate to meet the requirements of this Ordinance and any other ordinance or instrument supplemental thereto The rates, fees, tolls, and charges and tap fees due shall be collectea in any lawful manner -54 - I C Competent Management. The City shall employ experienced and competent management personnel for each component of the Sewerage Facilities If the City shall fail to pay the Debt Service Requirements of the Bonds promptly as the same fall due , or if the City shall fail to keep any of the covenants herein contained, and if such default shall continue for a period of sixty (60) days, or if the Net Pledged Revenues of the Sewerage Facilities in any Fiscal Year, together with other legally available revenue and money, should fail to equal at least the amount of the Debt Service Requirements of the Bongs, ana other obligations (including all reserves therefor specifiea in the authorizing proceedings, including but not limited to this Ordinance) payable from the Net Pleaged Revenues , proceeds and income in the Comparable Bond Year, the City shall retain a firm of competent management Persons skilled in the operation of sewerage facilities to assist in the management of the Sewerage Facilities so long as such default continues or the said revenues, proceeds and income are less than the amount hereinabove designated D Performance of Duties The City, acting by and through its officers, or otherwise , shall faithfully and punctually perform, or cause to be performed , all duties with respect to the Pledged Revenues, the Sewerage Facilities and the Project required by the Constitution and laws of the State, and the ordinances , resolutions and contracts of the City, including, without limitation, the proper segregation of the proceeds of -55- the Bonas and the Pledged Revenues and their application from time to time to the respective funds provided therefor E Costs of Bond Issue and of Performance Except as otherwise specifically providea herein, all costs and expenses incurred in connection with the issuance of the Bonds, payment of the Debt Service Requirements, or with the City ' s performance of or compliance with any covenant or agreement contained in this Ordinance , shall be paid exclusively (but only from the appropriate special fund in the manner authorized herein) from the proceeds of the Bonds, or from the Pledged Revenues, or from other legally available moneys, and in no event shall any of such costs or expenses be required to be paid out of or chargea to the general funds of the City F Contractual Obligations The City will perform all contractual obligations undertaken by it under the Bond Purchase Agreement with the Purchaser as described in Section 4B hereof and any other agreements relating to the Bonds, the Pledged Revenues, the Sewerage Facilities or the Pro3ect G Further Assurances At any and all times the City shall, so far as it may be authorized by law, pass, make, do execute , acknowleage , 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 and confirming all and singular the rights, the Pledged Revenues and other funds and accounts hereby pleaged or assigned , or intenaed so to be , or which the City may hereafter -56- become bound to pledge or 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 Pledgea Revenues and other funds and accounts pledged hereunder and all the rights of every Holder of any of the Bonds against all claims and demands of all Persons whomsoever H Conditions Precedent Upon the date of issuance of any of the Bongs, all conditions, acts and things required by the Constitution or laws of the United States, the Constitution or laws of the State , the home rule charter of the City, and 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, together with all other obligations of the City, shall not contravene any debt or other limitation prescribed by the Constitution or laws of the United States or the Constitution or laws of the State or the home rule charter of the City I Efficient Operation and Maintenance , No Free Service The City shall at all times operate the Sewerage Facilities properly ana in a sound and economical manner The City shall maintain, preserve and keep the Sewerage Facilities properly or cause the same so to be maintainea , preserved , and kept , with the appurtenances and every part and parcel thereof in good repair , working order and condition, and shall from time to time make or cause to be made all necessary and proper repairs, -5-7- replacements and renewals so that at all times the maintenance of the Sewerage Facilities may be properly and advantageously conducted. All salaries, fees, wages and other compensation paid by the City in connection with the repair, maintenance and operation of the Sewerage Facilities shall be fair and reasonable The City shall supply no free service to any Person If the City shall use the Sewerage Facilities as a customer, it shall pay a fair and reasonable amount for such service In no event shall the City pay a greater amount than would be charged a private Person for the same amount of service The City shall include in its annual budgets and appropriation measures, amounts sufficient to pay for service so furnished. J Records and Accounts 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 referred to herein K Rules, Regulations and Other Details The City, acting by and through its officers, shall establish and enforce reasonable rules and regulations governing the construction, operation, care, repair, maintenance, management, control, use and services of the Sewerage Facilities The City shall observe and perform all of the terms and conditions contained in this Ordinance and shall comply with all valid acts, rules, regulations, orders and directives of any legislative, executive, administrative or judicial body applicable to the Sewerage Facilities, the Project or the City. -58- L Payment of Governmental Charges The City shall pay or cause to be paid all taxes and assessments or other municipal or governmental charges, if any, lawfully levied or assessed upon or in respect of the Sewerage Facilities, the Project, or upon any part thereof , or upon any portion of the Pledged Revenues, when the same shall become due, and shall duly observe and comply with all valid requirements of any municipal or governmental authority relative to the Sewerage Facilities, the Project, or any part thereof, except for any period during which the same are being contested in good faith by proper legal proceedings The City shall "not create or suffer to be created any lien or charge upon the Sewerage Facilities, the Project, or any part thereof, or upon the Pledged Revenues, except the pledge and lien created by this Ordinance for the payment of the Debt Service Requirements due in connection with the Bonds, and except as herein otherwise permitted. The City shall pay or cause to be discharged or shall make adequate provision to satisfy and to discharge, within ninety (90) days after the same shall become payable , all lawful claims and demands for labor, materials, supplies or other objects which, if unpaid, might by law become a lien upon the Sewerage Facilities, the Project or any part thereof, or the Pledged Revenues, but nothing herein requires the City to pay or to cause to be discharged or to make provision for any such tax, assessment, lien or charge, so long as the validity thereof is contested in good faith and by appropriate legal proceedings. -59- M 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 Holder of any Bonds or other security payable from Pledged Revenues might be prejudicially and materially impaired or diminished N. Accumulation of Interest Claims In order to prevent any accumulation of coupons or 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 coupon or claim for interest on any of the Bonds or any other securities payable from 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 coupons or other claims for interest. If the time for the payment of any such coupons or of any other such installment of interest is extended in contravention of the foregoing provisions, such coupon or 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 or coupons the payment of which has not been extended -60- O Prompt Payment of Bonds The City shall promptly pay the Debt Service Requirements of every Bond at the places, on the dates, and in the manner specified herein and in the Bonds and in the coupons thereto pertaining according to the true intent and meaning hereof. P Use of Principal and Interest and Debt Service Reserve Funds The Principal and Interest Fund and the Debt Service Reserve Fund 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 Prior Parity Bonds, the Bonds, Additional Parity ,Bonds and any other Parity Securities to their respective maturities or any Redemption Date or Redemption Dates on which the City is obligated to redeem Bonds, subject to Section 9 hereof Q. Additional Securities The City shall not hereafter issue any bonds or securities relating to the Sewerage Facilities or the Project and payable from Pledged Revenues, other than the Bonds, without compliance with the requirements with respect to the issuance of Additional Parity Bonds or other securities set forth herein R Other Liens Other than as provided herein, there are no liens or encumbraces of any nature whatsoever on or against the Sewerage Facilities, the Project or any part thereof, or on or against the Pledged Revenues S Disposal of Sewerage Facilities Prohibited Subject to Section 8V hereof , except for the use of the Sewerage Facilities and services pertaining thereto in the normal course of -61- business, neither all nor a substantial part of the Sewerage Facilities shall be sold, mortgaged, pledged, encumbered, alienated or otherwise disposed of, until all of the Bonds have been paid in full, as to all Debt Service Requirements, or unless provision has been made therefor, or until the Bonds have otherwise been redeemed, including , without limitation, the termination of the pledge as herein authorized Sub3ect to Section 8V hereof, the City shall not dispose of its title to the Sewerage Facilities or to any useful part thereof, including any property necessary to the operation and use of the Sewerage Facilities and the lands and interests in lands comprising the Sewerage Facilities T 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. The cost of each such bond shall be considered an Operation and Maintenance Expense, unless otherwise provided by law U Arbitrage Covenant The City covenants that it will make no investment or other use of the proceeds of the Bonds, 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 Section 103 (c) of the Internal Revenue Code of 1954, as amended, and the regulations thereunder, and that it will comply with the requirements of said Section 103 (c) throughout the term of the Bonds -62- V Disposal of Property. No part of the Sewerage Facilities shall be sold, leased, mortgaged, pledged, encumbered or otherwise disposed of or otherwise alienated, until all of the Bonds have been paid in full, or unless provision has been made therefor , or until the Bonds have otherwise been redeemed, provided , however, that the City may sell, exchange or lease at any time and from time to time any property or facilities constituting part of the Sewerage Facilities and not useful in the construction, reconstruction or operation thereof, but any proceeas of any such sale or exchange received ana not used to replace such property so sold or exchanged shall be deposited in the Sewer Fund , and any proceeds of any such lease received shall be deposited by the City as revenues of the Sewerage Facilities W. Loss from Condemnation If any part of the Sewerage Facilities is taken by the exercise of a power of eminent domain, the amount of any award received by the City as a result of such taking shall be expensed upon the Improvement or Equipment of the Sewerage Facilities or upon both its Improvement and Equipment, or shall be applied to the redemption of the Outstanding Prior Parity Bonds, the Bonds, any Outstanding Adaitional Parity Bonas and any Outstanding Parity Securities in accordance with the provisions hereof and of any other instrument pertaining to the issuance of any such Parity Securities at maturity or prior thereto if the authorizing ordinances authorize the prior redemption of such securities, or shall be deposited in the Sewer Depreciation and Capital -63- Improvements Fund and held as a reserve for expenditure subsequently upon such capital improvements, or any combination thereof, as the Council may determine. X Inspection of Records Any Holder of any of the Bonds or any other securities payable from the Pledged Revenues, any duly authorized agent or agents of such Holder , or the Purchaser of the Bonds, shall have the right at all reasonable times to inspect all records, accounts and data relating thereto, concerning the Sewerage Facilities, the Project, the Pledged Revenues, or all or any other combination thereof, to make copies of such records, accounts and data at the Holder ' s or Purchaser ' s expense , and to inspect the Sewerage Facilities and properties comprising the Sewerage Facilities Y Audits Required The City, annually following the close of each Fiscal Year, shall order an audit for the Fiscal Year of the books and accounts pertaining to the Sewerage Facilities to be made forthwith by an Independent Accountant, and order an audit report showing the receipts and disbursements for each fund or account pertaining to the Sewerage Facilities, the Project , the Pledged Revenues, or all or any other combination thereof All expenses incurred in the making of the audits and reports required by this subsection shall be regarded and paid as an Operation and Maintenance Expense 2 Insurance and Reconstruction The City shall at all times maintain with responsible insurers all such insurance reasonably required and obtainable within limits and at costs deemed reasonable by the City as is customarily maintained with -64- respect to sewerage facilities of like character against loss of or damage to the Sewerage Facilities and against public and other liability to the extent at least reasonably necessary to protect the interest of the City ana of each Holaer of a Bond or any other security payable from the Pledged Revenues, except as herein otherwise provided If any useful part of the Sewerage Facilities shall be damaged or destroyed , the City shall, as expeditiously as possible, commence and diligently proceed with the repair or replacement of the aamaged or destroyed property so as to restore the same to use The proceeds of any insurance appertaining to the Sewerage Facilities shall be payable to the City and (except for proceeds of use and occupancy insurance) shall be applied to the necessary costs involved in such repair and replacement, and to the extent not so applied shall (together with the proceeas of any such use and occupancy insurance) be deposited in the Sewer Fund as Pledged Revenues If the costs of such repair and replacement of the damaged or destroved property exceed the proceeds of such property insurance available for payment of the same , moneys in the Sewer Fund shall be used to the extent necessary for such purpose, as permitted by Section 5J hereof AA Comoletion of Pro]ect, Estimated Life of Pro3ect Tne City , with the proceeds derivea from the sale of the Bonds, and any other legally available moneys, including the proceeas derived from the issuance of Additional Parity Bonds, shall proceed to cause the Pro3ect to be completed without delay to -65- the best of the City 's ability and with due diligence, as herein provided The Council hereby determines that the estimated life of the Pro3ect to be financed with the Bond proceeds is not less than twenty (20) years 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 ne discharged and the Bonds shall no longer be deemed to be Outstanding within the meaning of this Ordinance Tnere shall be deemed to be such due payment when the City has placed in escrow or in trust with a Trust Bank locatea within or without the State , moneys or Federal Securities in an amount sufficient (inclucing 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 oue to the final maturities of the Bonds or upon any Redemption Date as of which the City shall have exercised or shall have obligated itself to exercise its prior redemption option by a call of Bonds for payment then The Federal Securities shall become due prior to the respective times at which the proceeds thereof shall be neeaeo , in accordance with a schedule established and agreed upon betwen the City and such bank at the time of the creation of the escrow or trust, or the Federal Securities shall be sub3ect to redemption at the option of the holder thereof to assure such availability as so neeaed to meet such schedule -66- Section 10 Default Provisions and Remedies of Bondholders A Events of Default Each of the following events is hereby declared to be and to constitute an Event of Default (1) Nonpayment of Principal or Premium Payment of the principal of any of the Bonds, or any prior redemption premiums due in connection therewith, or both, is not made when the same becomes due and payable , either at maturity or by proceedings for prior redemption, or otherwise, (2) Nonpayment of Interest Payment of any installment of interest is not made when the same becomes due and payable, (3) Incapaole to Perform The City for any reason is, or is renaered , 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 or to be performea by it under any contract relating to the Pledged Revenues , to the Project, to the Sewerage Facilities or to all or any combination thereof, or otherwise, incluaing , without limitation, this Ordinance , and such failure shall continue for sixty (60) cays after receipt of notice from the Holaers of twenty-five percent (25€) in aggregate principal amount of the Bonds then Outstanding , proviaed that if such failure cannot be cured within such sixty (60) days and if during that period corrective action has commenced to remedy such failure and subsequently is diligently pursued by the City -67- to the completion of such performance, an Event of Default shall not be deemed to have occurred, (5) Failure to Reconstruct The City discontinues or unreasonably delays or fails to carry our with reasonable dispatch the reconstruction of any revenue-producing part of the Sewerage Facilities which is condemned, oestroyed or damaged and is not promptly repaired or replaced (whether such failure to repair the same is due to impracticality of such repair or replacement , or is due to a lack of moneys therefor , or for other reason) , (6) Appointment of Receiver An order or decree is entered by a court of competent 3urisaict;on, with the consent or acquiescence of the City, appointing a receiver or receivers for the Sewerage Facilities or for the Pledged Revenues and any other moneys sub]ect to the lien to secure the payment of the Bonas, or both the Sewerage Facilities and such moneys, 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 , (7) Default of Ary Provision The City makes any default in the due ana punctual performance of any other of the representations , covenants , conoitions, agreements and other provisions contained in the Bonds or in this Ordinance on its part to be performed , and if such aefault 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 Holders of twenty-five percent (25€) in aggregate principal -68- amount of the Bonds then Outstanding , provided that if such default cannot be cured within such sixty (60) days and if during that period corrective action has commenced to remedy such default and subsequently is diligently pursued to the completion of such performance , an Event of Default shall not be deemed to have occurred B Remeaies for Defaults Upon the happening and continuance of any of the Events of Default , as provided in Section 10A hereof , then and in every case the Holder or Holders of not less than twenty-five percent (25%) 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 Holder of Bonds or coupons under this Ordinance by mandamus 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 Holder or Holders may deem most effectual to protect and to enforce the rights aforesaid, or thereby to enjoin any act or thing whicn may be unlawful or in violation of any right of any Holder of any Bona, 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 -69- instituted , had and maintained for the equal benefit of all Holders of the Prior Parity Bonds, the Bonds, and any Aaditional Parity Bonds or additional Parity Securities, and the coupons then Outstanding Any receiver or operating trustee appointed in any proceedings to protect the rights of such Holders hereunder 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 The consent to any such appointment is hereby expressly granted by the City C. Rights and Privileges Cumulative The failure of any Holaer 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 to carry out any duty, obligation or other commitment Each right or privilege of any such Holaer or trustee therefor 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 Holaer shall not be deemed a waiver of any other right or privilege thereof Each Holder of any Bond shall be entitlea to all of the privileges, rights and remedies provided or permittea in this Ordinance and as otherwise provided or permitted by law or in equity or by statute, except as provided in Sections 12A and 12B hereof , and sub3ect to the appicable provisions concerning the Pledged Revenues and the proceeds of the Bonds Nothing herein affects or impairs the right of any Holder of any Bond to enforce the payment of the Debt Service Requirements due -70- in connection witn this Bond or the obligation of the City to pay the Debt Service Requirments of each Bond to the Holder thereof at the time and the place expressed in such Bond and in the appurtenant coupons D Duties Upon Default Upon the happening of any of the Events of Default as provided in Section 10A hereof , the City, in adaition, will do and perform all proper acts on behalf of and for the Holders of the Outstanding Bonds and coupons pertaining thereto to protect and to preserve the security createa for the payment of their Bonds and coupons and to insure the payment of the Debt Service Requirements promptly as the same become cue During any period of default , so long as any of the Bonas or coupons, 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 ana Interest Fund , or , in the event of securities hereafter issued and Outstanding during such period of time on a parity with the Bonds, shall be paid into the Principal and Interest Fund for all Parity Securities, including the Bonds, on an equitable and prorated basis , and used for the purposes therein proviaed If the City fails or refuses to proceed as in this Section 10D proviaea , the Holder or holaers of not less than twenty-five percent (25€ ) in aggregate principal amount of the Bonds then Outstanding , after demand in writing , may proceed to protect and to enforce the rights of the Holders of the Bonds as hereinabove proviaea , ana to that end any such Holders of Outstanding Bonas shall be subroaated to all rights of the City under any -71- agreement or contract involving the Pledged Revenues entered into prior to the effective date of this Ordinance or therafter 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 if it so proceeds it is more likely than not to incur a net loss rather than a net gain or such action is likely to affect materially and prejudicially the Holders of the Outstanding Bonds and any Outstanding Parity Securities E Evidence of Securitvholders Any request, consent or other instrument which this Ordinance may require or may permit to be signed and to be executed by the Holder 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 Holder 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 holding by any Person of the securities or coupons pertaining thereto, 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 Holder of any Bonds or otner 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 Clerk or of any notary public or other officer autnorized to -72- take acknowledgments of deeas to be recorded in the state in which he purports to act, that the individual signing such reauest or other instrument acknowleaged to him the execution, auly 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 holder of any securities may be established without further proof if such instrument is signed by an inaividual purporting to be the president or vice-president of such corporation with the corporate seal affixes 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 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 Holdings The amount of Bonds or other securities transferable by delivery held by any Person executing any instrument as a holder of securities, and the numbers , date and other iaentification thereof , together with the date of his holding securities, may be proved by a certificate which need not be acknowledged or verified , in form satisfactory to the Clerk, executea 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 Clerk , or by any notary -73- public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he 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 , but the 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 Bonas as herein provided , when duly executed and delivered for the purposes proviaed for in this Ordinance, shall constitute a warranty by and on behalf of the City for the benefit of each and every future Holder of any of the Bonds that the Bonds have been issued for a valuable consideration in full conformity with law G Immunities of Purchaser The Purchaser and any associate thereof are under no obligation to any Holder of the Bonds for any action that they may not take or in respect of anything that they may or may not do by reason of any information containea in any reports or other aocuments receivea by them under the provisions of this Orainance The immunities and exemption from liability of the Purchaser and any associate thereof hereunaer extend to their partners , airectors, successors, assigns, employees and agents -74- Section 11 Amendment of Ordinance A Amendment of Ordinance Not Requiring Consent of Bonaholders The City may, without the consent of, or notice to, the Holders of the Bonds , adopt sucn 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 any ambiguity, or to cure, correct or supplement any aefect or inconsistent provision contained in this Ordinance , or to make any provision with respect to matters arising under this Ordinance or for any other purpose if such provisions are necessary or desirable ano do not adversely affect the interests of the Holders of the Bonds and coupons, or (2) To suo3ect to this Ordinance additional revenues, properties or collateral B Amendment of Ordinance Requiring Consent of Bonaholders Exclusive of the amendatory ordinances covered by Section 11A hereof , this Ordinance may be amenaed or modified by ordinances or other instruments duly adopted by the Council, without receipt by it or any aaditional consideration, but with the written consent of the Holders of sixty-six percent (66€) in aggregate principal amount of the Bonds and Outstanding at the time of the adoption of such amendatory ordinance, incluaing any Outstanaing refunding securities as may be issued for the purpose of refunding any of the Bonds, provided that no such amendatory resolution shall permit -75- (1) Changing Payment A change in the maturity or in the terms of redemption of the principal of any Outstanaing 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 Holder 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 pleage created by this Ordinance, or (4) Modifying Amendment Terms A reauction of the principal amount or percentages of Bonds, or any modification otherwise affecting the aescription of Bonas, otherwise changing the consent of the Holders of Bonds, which may be required herein for any amenament hereto, or (5) Priorities Betwen Bonds The establishment of priorities as between Bonds issuea and Outstanding under the provisions of this Ordinance, or (6) Partial Modification Any modifications otherwise materially and pre3udicially affecting the rights or privileges of the Holders of less than all of the Bonds then Outstanding khenever the Council proposes to amend or modify this Ordinance under the provisions of this Section 11B it shall give notice of the proposed amendment by publication at least one (1) time by one (1) publication, in The Coloradoan, Fort Collins, Coloraao, if then in business and publishing , and if not, then -76- in a newspaper of general circulation in the City, and in The Bona Buyer, New York, New York, if then in business and publishing , ana if not, then in a similar financial newspaper or Dournal published in New York, New York, as determined by the Council , such notice to be deemed complete upon the last such publication, and copies of such notice shall be mailea within thirty (30) days after such last publication to the Purchaser of the Bonds, or to any successor thereof known to the Clerk and to all such Holders of Bonds as have furnished their names and addresses and the numbers of their Bonds to the Clerk pursuant to Section 3B (2) hereof Such notice shall briefly set forth the the nature of the proposed amendment and shall state tnat a copy of the proposed amendatory ordinance or other instrument is on file in the office of the Clerk for public inspection 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 Clerk an instrument or instruments executed by the Holders of at least sixty-six percent (66%) in aggregate principal amount of the Bonas then Outstanding , which instrument or instruments shall refer to the proposed amenaatory 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 amenaatory ordinance or instrument and such ordinance or instrument shall become effective If the Holders of at least sixty-six percent (66€ ) in aggregate -77- principal amount of the Bonds then Outstanding , at the time of the aaoption of such amendatory ordinance or instrument, or the predecessors in title of such Holaers, shall have consented to and approved the adoption thereof as herein provided, no Holder of any Bond whether or not such Holder shall have consented to or shall have revoked any consent as herein provided shall have any right or interest to ob3ect to the adoption of such amendatory ordinance or other instrument or to ob3ect to any of the terms or provisions therein contained or to the operation thereof or to en3oin or restrain the City from taking any action pursuant to the provisions thereof Any consent given by the Holder of a Bond pursuant to the provisions thereof shall be irrevocable for a perioa of six (6) months from the date of the completion of the notice above proviaed for ana shall be conclusive and binding upon all future Holders 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 Holder who gave such consent or by a successor in title, by filing notice of such revocation with the Clerk, but such revocation shall not be effective if the Holders of sixty-six percent (66€ ) in aggregate principal amount of the Bonas Outstanding as herein provided , prior to the attempted revocation, snall have consented to ana 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 -78- thereof , and the rights and the obligations of the City and of the Holders of the Bonds and coupons thereunder may be modified or amended in any respect upon the adoption by the City and upon the filing with the Clerk of an instrument to that effect and with the consent of the Holders of all the then Outstanding Bonds, such consent to be given in the manner provided in Section 11C hereof , and no notice to Holders of Bonds, either by mailing or by publication, 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 City shall furnish to the Clerk a certificate , upon which the Clerk may rely, describing all Bonds to be excluded for the purpose of consent or of other action or or 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 celivered after the effective date of any action taken as provided in Section 11B, 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 authenticated and delivered after such date does not bear such notation, then upon demand of the Holder of any Bond Outstanding at such effective date and upon presentation of his -79- Bond for such purpose at the principal office of the City, suitable notation shall be made on such Bond by the 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 preparea , authenticated and delivered, and upon demand of the Holaer of any Bond then Outstanding, shall be exchanged without cost to such Holder for Bonds then Outstanding upon surrender of such Outstanding Bonas with all unmatured coupons pertaining thereto G Proof of Instrument and Bonas The fact and date of execution of any instrument under the provisions of this Section 11, the amount and number of the Bonas held by any Person executing such instrument , and the date of his holding 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 Bonas shall ever impose or shall be construed as imposing any liability , obligation, or charge against the City (except for the special funas pledged therefor) or against the general creait of the City payable out of general funds or out of any funas derived from general property taxes 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 of the City No property of the City, sub3ect to such exception with respect to -80- the Pledged Revenues, pledged for the payment of the Bonas, shall be liable to be forfeited to taken in payment of the Bonds C Statute of Limitations No action or suit based upon any Bond , coupon 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 Holder of any Bond or coupon or the obligee regarding any such obligation shall be conclusively presumea to have been repudiated on the maturity date or other cue date thereof unless the Bond or coupon 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 reservea, 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 Sewer Fund, unless the Council shall otherwise provide by ordinance Nothing herein prevents the payment of any such Bond, coupon, 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 orcers such payment to be made D Delegatea 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, incluoing , without limitation -81- (1) Printing Bonds. The printing of the Bonds, including at the option of the Council the printing upon each such Bond of a copy of the approving legal opinion of Ballard , Spahr , Andrews & Ingersoll, bona counsel, duly certified by the Clerk , (2) Final Certificates The execution of such certificates as may be reasonably required by the Purchaser, relating , inter alia, to (a) The signing of the Bonds , (b) The tenure ana identity of the officials of the City, (c) If in accordance with fact, the absence of litigation, pending or threatenea , affecting the valiaity of the Bonds, (d) The delivery of the Bonus and the receipt of the Bond purchase price, (e) The exemption of interest on the Bonds from federal and State income taxation, (f) The aisclosure of information provided in any Bond offering brochure, preliminary official statement, official statement or offering circular for prospective buyers of the Bonds (3) Information The assembly and dissemination of financial and other information concerning the City and the Bonds , (4) Official Statement The preparation of a Bond offering brochure, preliminary official statement, official -82- statement or offering circular for the use of prospective buyers of the Bonds, including , without limitation, such use by the Purchaser and its associates, if any, and (5) Bond Sale The execution of the Bonds and the sale , issuance , and aelivery of the Bonds to the Purchaser pursuant to the provisions of this Ordinance E Successors Whenever herein the City is named or is referred to, such provision shall be deemed to incluae 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 bina 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 oraer to comply with any such covenants, stipulations, obligations , agreements or other provisions hereof F Rights and Immunities Except as herein otherwise expressly proviaed , nothing herein expressed or implied is intenaed or shall be construed to confer upon or to give to any Person, other than the City , and the Holders from time to time of the Bonds and the coupons thereunto pertaining , any right, remeay or claim under or by reason hereof or any covenant, conaition or stipulation hereof All the covenants, stipulations, promises ana agreements herein contained by and on -83- behalf of the City shall be for the sole and exclusive benefit of the City, and any Holder of any of the Bonds and the coupons thereunto pertaining 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 waives and released G Ratification All action not inconsistent with the provisions of this Ordinance heretofore taken by the City or its officers, and otherwise by the City directea (1) Pro3ect Toward the Pro3ect, and (2) Bonas Toward the sale and delivery of the Bonds for that purpose, be, and the same hereby is, ratified , approved and confirmed H Facsimile Signatures Pursuant to the Uniform Facsimile Signature of Public Officials Act , part 1 of article 55 of title 11, Colorado Revisea Statutes 1973, as amended , the Mayor and the Clerk shall forthwith, and in any event prior to the time the Bonds are delivered to the -84- Purchaser , file with the Colorado Secretary of State their manual signatures certified by them under oath. I Orainance 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 Holder or Holders of the Bonds , and this Ordinance , subject to the provisions of Sections 9 and 11 hereof, if any Bonds are in fact issued, shall be and shall remain irrepealable until the Bonds, as to all Debt Service Requirements, shall be fully paid, cancelled and discharged , as herein provided J ReDealer All ordinances, resolutions, bylaws, orders, and other instruments, or parts thereof, inconsistent herewith are hereby repealea 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 repealea. K Severability If any section, subsection, paragraph, clause or other provision of this Orainance shall for anj 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 Section 13 Amendment of Ordinance No 9 , 1975 A Recitals The Prior Parity Bonds were issuea pursuant to Ordinance No 9, 1975 In Section 6 of Ordinance No 9, 1975, the City has covenanted to deposit in the Sewer Fund all -85- income and revenues derived from the operation of the Sewerage Facilities, "except the City ' s existing sewer trunk line assessments, sewer main line assessments, and sewer tap fees and the plant investment fees credited to the City 's existing Sewer Capital Improvement Fund HThe City desires to pledge sewer tap fees and plant investment fees for the payment of the Bonds and also aesires that the Prior Parity Bonds be secured equally with the Bonds Ordinance No. 9, 1975, contains no restrictions as to the amenament thereof, and the amendment herein made will not adversely affect any right of any Holaer of any of the Prior Parity Bonds B Amenament The second sentence of Section 6 of Ordinance No 9, 1975, is hereby amended to read as follows ***So long as any of the bonds hereby authorized shall be outstanding , either as to principal or interest, all income and revenues derived from the operation of the system, except the City 's existing sewer trunk line assessments and sewer main line assessments shall be deposited into the Sewer Fund INTRODUCED, READ, APPROVED ON FIRST READING, AND ORDERED PUBLISHED ONCE IN FULL THIS 7th day of September, 1982 CITY OF FORT COLLINS, COLORADO By , (CITY) Mayor (SEAL) ATTEST City Clerk -86- f The foregoing Ordinance will be presented for final passage at a regular meeting of the Council to be held at Council Chambers, City Hall, 300 LaPorte Avenue, Fort Collins, Colorado, on Tuesday, the 21st day of September , 1982, at 5 30 p m. -87- READ, FINALLY PASSED ON SECOND READING, AND OPDERED PUBLISHED ONCE BY NUMBER AND TITLE ONLY this 21st day of September , 1982. CITY OF FORT COLLINS, COLORADO By (CITY) Mayor (SEAL) ATTEST City Clerk -88-