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HomeMy WebLinkAbout123 - 08/19/1997 - AMENDING ORDINANCE NO. 074, 1992, AUTHORIZING THE ISSUANCE OF STORM DRAINAGE REVENUE REFUNDING BONDS ORDINANCE NO. 123 , 1997 AN ORDINANCE AMENDING ORDINANCE NO. 74, 1992, AUTHORIZING THE ISSUANCE OF CITY OF FORT COLLINS, COLORADO, STORM DRAINAGE REVENUE REFUNDING BONDS, SERIES 1992 , DATED JULY 1, 1992 , IN THE AGGREGATE PRINCIPAL AMOUNT OF $4,335, 000. WHEREAS, the City of Fort Collins, Colorado (the "City") , has heretofore issued and sold its Storm Drainage Revenue Refunding Bonds, Series 1992, dated July 1, 1992, in the aggregate principal amount of $4, 335, 000 (the "Bonds") pursuant to Ordinance No. 74, 1992 (the "Ordinance") ; and WHEREAS, the Ordinance provides in Section 5E thereof as follows: Nothing in this Ordinance shall be construed as limiting the right of the City to substitute for the cash deposit required to be maintained hereunder a letter of credit, surety bond, insurance policy, agreement guaranteeing payment, or other undertaking by a financial institution to ensure that cash in the amount otherwise required to be maintained hereunder will be available to the City as needed, provided that any such substitution shall be submitted to Moody's Investors Service, Incorporated and shall not cause the then-current rating of the Bonds to be adversely affected. and WHEREAS, substitution of a surety bond for the cash deposit required to be maintained in the debt service reserve account for the Bonds will permit the City to use such cash deposit to provide funds sufficient, together with proceeds of certain bonds to be issued by the City of Fort Collins, Colorado, Stormwater Utility Enterprise (the "Enterprise") in part to refund, pay and discharge certain outstanding storm drainage revenue bonds of the City; and WHEREAS, the City, for itself and the Enterprise, has received Commitment for Surety Bond No. SB15181, dated July 10, 1997 (the "Surety Bond Commitment") , from AMBAC Indemnity Corporation ("AMBAC Indemnity") to issue a surety bond (the "Surety Bond") for the purpose and in compliance with the requirements specified in the Ordinance; and WHEREAS, the Surety Bond Commitment requires that certain amendments be made to the Ordinance in order to enable AMBAC Indemnity to issue the Surety Bond; and WHEREAS, the Ordinance provides in Section 11A thereof as follows: The City may, without the consent of, or notice to, the Owners of the Bonds, adopt such ordinances supplemental hereto (which amendments shall thereafter form a part hereof) for any one or more or all of the following purposes: (1) To cure or correct any formal defect, ambiguity or inconsistent provision contained in this Ordinance; (2) To appoint successors to the Paying Agent, Registrar, Transfer Agent, Securities Depository or Escrow Bank; (3) To designate a trustee for the Owners of the Bonds, to transfer custody and control of the Income to such trustee, and to provide for the rights and obligations of such trustee; (4) To add to the covenants and agreements of the City or the limitations and restrictions on the City set forth herein; (5) To pledge additional revenues, properties or collateral to the payment of the Bonds; (6) To cause this Ordinance to comply with the Trust Indenture Act of 1939, as amended from time to time; or (7) To effect any such other changes hereto which do not in the opinion of nationally recognized bond counsel materially adversely affect the interests of the Owners of the Bonds. BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS, COLORADO, THAT: Ordinance No. 74, 1992, is hereby amended as follows, said amendments to take effect only upon delivery of the Surety Bond: 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: (2.1) AMBAC Indemnity: AMBAC Indemnity corporation, a Wisconsin domiciled stock insurance company. (17.1) Enterprise: the City of Fort Collins, Colorado, stormvater Utility Enterprise. 2 (24.1) Guaranty Agreement: the Guaranty Agreement, dated as of August 1, 1997, by and between the Enterprise and AMBAC Indemnity. (24.2) Guaranty Obligations: all amounts drawn on the Surety Bond and any related reasonable expenses incurred by AMBAC Indemnity in connection with the Surety Bond and the enforcement by AMBAC Indemnity of the obligations of the Enterprise under the Guaranty Agreement, together with interest thereon for the periods specified in the Guaranty Agreement at a rate equal to the lower of (a) the prime rate of Citibank, N.A. plus 2% per annum, and (b) the maximum rate of interest permitted under the limitation imposed by law. (56.1) Surety Bond: the surety bond issued by AMBAC Indemnity to the Enterprise guaranteeing certain payments into the Debt Service Reserve Account with respect to the Bonds as provided herein and therein and subject to the limitations hereof and thereof. (56.2) Surety Bond Commitment: Commitment for Surety Bond No. SB15181, dated July 10, 1997, from AMBAC Indemnity to the City, for itself and the Enterprise, to issue the Surety Bond. Section 3 . The Bonds. B. Bond Details. (5.1) Resignation or Removal of Agents. If the Paying Agent, Registrar, Transfer Agent or Escrow Bank shall resign as such, or if the City shall reasonably determine that the Paying Agent, Registrar, Transfer Agent or Escrow Bank has become incapable of fulfilling his, her or its duties under this Ordinance, the City may, upon notice mailed to AMBAC Indemnity and to the Owners of the Bonds at the addresses shown on the registration books of the City, accept the resignation of or, with the consent of AMBAC Indemnity, remove the Paying Agent, Registrar, Transfer Agent or Escrow Bank and, with the consent of AMBAC Indemnity, select and appoint a successor paying agent, registrar, transfer agent or escrow bank. Every such successor paying agent, registrar, transfer agent or escrow bank shall be a Trust Bank. It shall not be required that the same institution serve as paying agent, registrar, transfer agent and escrow bank, but the City shall have the right to have the same institution serve as paying agent, registrar, transfer agent and escrow bank. Any such 3 resignation or removal shall become effective only upon the appointment of a successor. Section 5. Disposition of Bond Proceeds and Funds and Accounts Adopted or Created by Ordinance: Security For Bonds. The proceeds of the Bonds and the Income shall be deposited by the City in the funds described in this Section 5, to be accounted for in the manner and priority set forth in this Section 5. Neither the Purchaser nor any subsequent Owner of any Bonds shall be in any manner responsible for the application or disposal by the City or by any of its officers, agents and employees of the moneys derived from the sale of the Bonds or of any other moneys designated in this Section 5. The Net Pledged Revenues and all moneys and securities paid or to be paid to or held or to be held in any fund or account hereunder are hereby pledged to secure the payment of the Debt Service Requirements of the Bonds (including any Guaranty Obligations incurred by the Enterprise) , subject to the provisions herein relating to the Excess Investment Earnings Account and subject to the application of the Net Pledged Revenues for the payment of Debt Service Requirements of Parity Securities. 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. The lien of this pledge and the obligation to perform the contractual provisions hereby made shall have priority over any or all other obligations and liabilities of the City (except as herein otherwise expressly provided) , and the lien of this 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. E. Debt Service Reserve Account. The City shall deposit in the Debt Service Reserve Account, forthwith upon receipt of the proceeds of the Bonds, proceeds of the Bonds in the approximate amount of $14,000. 00 and other funds of the City in the approximate amount of $30,000. 00. Subject to the payments required by Sections 5C and 5D hereof and except as provided in Section 5F hereof, from the Net Pledged Revenues, there shall be credited from time to time as hereinafter provided to the Debt Service Reserve Account moneys sufficient to accumulate in and maintain the Debt Service Reserve Account at an amount at least equal to ten percent (10%) of the proceeds of the Bonds and any other Parity Securities to which the Debt Service Reserve Account is pledged. In the event that the amount of the Debt Service Reserve Account falls below said amount, the City shall credit to the Debt Service Reserve Account from the Net Pledged Revenues that sum of money needed to 4 accumulate or reaccumulate the amount therein so that at all times the amount of the Debt Service Reserve Account equals said amount. The moneys required to be deposited in the Debt Service Reserve Account, excluding investment earnings which may be required to be deposited in the Excess Investment Earnings Account or rebated to the federal government, 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 5E and Sections 5F and 9 hereof, only to prevent deficiencies in payment of the Debt Service Requirements of the Bonds, any Additional Parity Bonds and any other Parity Securities then Outstanding resulting from failure to deposit into the Principal and Interest Account sufficient funds to pay such Debt Service Requirements as the same become due. If at any time the City shall for any reason fail to pay into the Principal and Interest Account the full amount above stipulated, then an amount shall be paid into the Principal and Interest Account at such time from the Debt Service Reserve Account equal to the difference between that paid from the Net Pledged Revenues and the full amount so stipulated. The money so used shall be replaced to the Debt Service Reserve Account from the first moneys credited to the Storm Drainage Fund thereafter received and not required to be otherwise applied by Sections 5C and 5D hereof. If Additional Bonds or other Parity Securities are Outstanding and the ordinances authorizing the issuance of those securities require the replacement of moneys in a separate reserve account therefor, then the moneys replaced in the Debt Service Reserve Account 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 Additional Parity Bonds 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 Account the full amount stipulated herein from the Net Pledged Revenues, the 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 Storm Drainage Fund thereafter received and not required to be applied otherwise by Sections 5C and 5D hereof. Nothing in this Ordinance shall be construed as limiting the right of the City to substitute for the cash deposit required to be maintained hereunder a letter of credit, surety bond, insurance policy, agreement guaranteeing payment, or other undertaking by a financial institution to ensure that cash in the amount otherwise required to be maintained hereunder will be available to the City as needed, provided that any such substitution shall be submitted to Moody's Investors Service, Incorporated and shall not cause the then-current rating of the 5 • Bonds to be adversely affected. Any such credit instrument shall be deposited with the Paying Agent, which shall ascertain the necessity for a claim against or draw upon the credit instrument and provide notice to the issuer of such credit instrument in accordance with its terms not later than three (3) days (or such longer period as may be necessary, depending on the permitted time period for honoring claims or draws thereunder) prior to each Interest Payment Date. if a letter of credit is substituted for the cash deposit required to be maintained hereunder, the Paying Agent shall draw upon such letter of credit prior to its expiration or termination unless an alternate credit instrument conforming with the provisions hereof has been substituted therefor or the amount otherwise required to be maintained hereunder is on deposit in the Debt Service Reserve Account. After the delivery of the Surety Bond to the Paying Agent, all moneys held in the Debt Service Reserve Account shall be withdrawn by the City. Thereafter, in the event and to the extent that moneys on deposit in and credited to the Principal and Interest Account, plus all amounts on deposit in and credited to the Debt Service Reserve Account in excess of the amount of the Surety Bond, are insufficient to pay the amount of principal and interest coming due, then upon the later of one (1) day after receipt by the General Counsel of AMBAC Indemnity of a demand for payment in the form attached to the Surety Bond as Attachment 1, duly executed by the Paying Agent and certifying that payment due under this Ordinance has not been made to the Paying Agent, or the payment date of the Bonds as specified in the demand for payment presented by the Paying Agent to the General Counsel of AMBAC Indemnity, AMBAC Indemnity is to make a deposit of funds in an account with the Paying Agent in New York, New York, sufficient for the payment to the Paying Agent of amounts which are then due to the Paying Agent under this Ordinance (as specified in the demand for payment) up to but not in excess of the surety bond coverage, as specified in the Surety Bond; provided, however, that in the event that the amount on deposit in, or credited to, the Debt Service Reserve Account, in addition to the amount available under the Surety Bond, includes amounts available under a letter of credit, insurance policy, surety bond or other such funding instrument, draws on the Surety Bond or such other funding instrument shall be made on a pro rota basis to fund the insufficiency. The Paying Agent, if appropriate, after submitting to AMBAC Indemnity the demand for payment as provided above, shall make available to AMBAC Indemnity all records relating to the funds and accounts maintained under this Ordinance. The Paying Agent, if appropriate, upon receipt of moneys received from the draw on the Surety Bond, as specified in the demand for payment, shall credit the Debt Service Reserve Account 6 to the extent of moneys received pursuant to such demand for payment and shall use such moneys for the purposes of the Debt Service Reserve Account as provided herein. Any Guaranty Obligations incurred by the Enterprise shall be paid by the Enterprise to AMBAC Indemnity as provided in the Guaranty Agreement. Payments of obligations or costs incurred by the Enterprise or the City under any additional undertaking shall be made in the manner specified herein on a pro rate basis. The Debt Service Reserve Account shall be replenished in the following priority: first, principal and interest on the Surety Bond shall be paid from first available Net Pledged Revenues or principal and interest on the Surety Bond and on any other funding instrument as described above shall be paid from first available Net Pledged Revenues on a pro rata basis; second, after all such amounts are paid in full, amounts necessary to fund the Debt Service Reserve Account in an amount equal to the amount required by this Section 5E, after taking into account the amounts available under the Surety Bond and any other funding instrument as described above, shall be deposited from nest available Net Pledged Revenues. F. Termination of Deposits. No payment need be made into the Principal and Interest Account or the Debt Service Reserve Account if the amount in the Principal and Interest Account and the amount in the Debt Service Reserve Account total a sum at least equal to the entire amount of the Outstanding Bonds, any Outstanding Additional Parity Bonds and any other Outstanding Parity Securities, as to all Debt Service Requirements, to their respective Maturity Dates or to any Redemption Date or Redemption Dates on which the City or the Enterprise shall have exercised or shall have obligated itself to exercise its option to redeem, prior to their respective Maturity Dates, any Bonds, any Additional Parity Bonds and any other Parity Securities, then Outstanding and thereafter maturing (provided that, solely for the purpose of this Section 5F, there shall be deemed to be a credit to the Debt Service Reserve Account 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 of the Bonds, any Additional Parity Bonds or any other Parity Security) , in which case moneys in the Principal and Interest Account and the Debt Service Reserve Account in an amount, except for any known interest or other gain to accrue from any investment or deposit of moneys pursuant to Section 6B hereof from the time of any such investment or deposit to the time or respective times the proceeds of any such investment or deposit shall be needed for such payment, at least equal to such Debt Service Requirements, shall be used together with any such gain from such investments and deposits solely to pay such Debt Service Requirements as the same become due. Any moneys 7 in excess thereof in the Principal and Interest Account and the Debt Service Reserve Account and any other moneys derived from the Income or otherwise pertaining to the Storm Drainage Facilities may be used in any lawful manner determined by the City. G. Payment of Subordinate Securities. After there has been deposited to the Principal and Interest Account an amount sufficient to pay all the Debt Service Requirements due during the current Bond Year on all Bonds, Additional Parity Bonds and other Parity Securities then outstanding and after the accumulations to and replenishments of the Debt Service Reserve Account and other payments required by Section 5E hereof to be made in the current Bond Year have been made, any moneys remaining in the Storm Drainage Fund for such Bond Year may be used by the City for the payment of Debt Service Requirements of Subordinate Securities payable from the Net Pledged Revenues and authorized to be issued in accordance with this Ordinance including reasonable reserves for such Subordinate Securities; but the lien of such Subordinate Securities on the Net Pledged Revenues and the pledge thereof for the payment of such Subordinate Securities shall be subordinate to the lien and pledge of the Bonds, any Additional Parity Bonds and any other Parity Securities as herein provided. Section 7. Priorities; Liens; Issuance of Additional Bonds. A. First Lien on Net Pledged Revenues; Eguality of Bonds. Except as expressly provided in this Ordinance with respect to Additional Parity Bonds, other Parity Securities and Subordinate Securities, the Net Pledged Revenues shall be and hereby are irrevocably pledged and set aside to pay the Debt Service Requirements of the Bonds (including any Guaranty Obligations incurred by the Enterprise) . The Bonds (including any Guaranty Obligations incurred by the Enterprise) constitute an irrevocable and first lien (but not necessarily an exclusive first lien) upon the Net Pledged Revenues (provided, however, that the Enterprise shall not pay any Guaranty Obligations incurred by the Enterprise unless all of the payments then due under Sections 5D and SE hereof have been made) . The Bonds, any Additional Parity Bonds and any other Parity Securities issued and from time to time Outstanding are equitably and ratably secured by a lien on the Net Pledged Revenues and shall not be entitled to any priority one over the other in the application of the Net 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 Bonds, any Additional Parity Bonds and any other Parity Securities, regardless of the fact that they may be actually issued and delivered at different times. 8 B. Issuance of Additional Parity Bonds. Nothing herein, except the limitations stated in Section 7F hereof, prevents the issuance by the City of Additional Parity Bonds payable from the Net Pledged Revenues and constituting a lien on the Net Pledged Revenues on a parity with, but not prior or superior to, the lien thereon of the Bonds; but before any such Additional Parity Bonds are authorized or actually issued the City shall satisfy the following conditions: (1) Absence of Default. At the time of the adoption of the supplemental ordinance or other instrument authorizing the issuance of the Additional Parity Bonds as provided in Section 7F hereof, the City shall not be in default in making any payments required by Section 5 hereof. (2) Historic Revenues Tests. Except as hereinafter provided in the case of Additional Parity Bonds issued for the purpose of refunding less than all of the Bonds and other Parity Securities then Outstanding, the Net Pledged Revenues for the last complete Fiscal Year prior to the issuance of the proposed Additional Parity Bonds, as certified by a Consulting Engineer or Independent Accountant, must have been equal to at least one hundred twenty-five percent (125%) of the Combined Average Annual Debt Service Requirements of the Bonds then Outstanding, any Additional Parity Bonds then Outstanding, and the Additional Parity Bonds proposed to be issued plus at least one hundred percent (100%) of all Guaranty obligations scheduled for payment under the Guaranty Agreement during said period. If any adjustment in stormwater basin fees, stormwater utility fees or other storm drainage rates, fees, tolls or charges is made by the City during such Fiscal Year, the Consulting Engineer or Independent Accountant shall adjust the calculation of the Net Pledged Revenues to reflect the amount thereof that would have been received if such adjustment had been in effect throughout such Fiscal Year. For purposes of this Section 7B(2) , when computing the Average Annual Debt Service Requirements for any issue of securities bearing interest at a variable, adjustable, convertible or other similar rate which is not fixed for the entire term thereof, it shall be assumed that any such securities Outstanding at the time of the computation will bear interest during any period, if the interest rate for such period has not been determined, at a fixed rate equal to the higher of 9.2% per annum or the highest interest rate borne during the preceding twenty-four (24) months by Outstanding securities of the City (excluding securities issued pursuant part 1 of article 3 of title 29, Colorado Revised Statutes, as amended, or other similar securities) bearing interest at a variable, adjustable, convertible or other similar rate or, if no such securities of the City are Outstanding at the time of the computation, by any similar securities for which the interest 9 rate is determined by reference to an index comparable to that to be utilized in connection with the securities proposed to be issued, or if the interest rate for such period has been determined and is not subject to variation, adjustment or conversion prior to the expiration of such period, at the fixed rate so determined. It shall further be assumed that any such securities which may be tendered prior to maturity for purchase at the option of the Owner thereof will mature on their stated Maturity Dates or mandatory Redemption Dates. In the case of Additional Parity Bonds issued for the purpose of refunding less than all of the Bonds and other Parity Securities then Outstanding, compliance with this Section 7B(2) shall not be required so long as the Debt Service Requirements payable on all Bonds and other Parity Securities Outstanding after the issuance of such Additional Parity Bonds on each Interest Payment Date does not exceed the Debt Service Requirements payable on all Bonds and other Parity Securities Outstanding prior to the issuance of such Additional Parity Bonds on such Interest Payment Dates. (3) Adeauate Reserves. The proceedings under which any such Additional Parity Bonds are issued must provide for the deposit of moneys to the Debt Service Reserve Account on substantially the same terms as provided in Section 5E hereof and contain a covenant by the City to maintain the Debt Service Reserve Account in an amount equal to ten percent (10%) of the proceeds of the Additional Parity Bonds. Alternatively, if such action is deemed by the City to be necessary or desirable in order to comply with any statute or regulation governing the exemption from federal income taxes of interest on any such Additional Parity Bonds, the proceedings under which any such Additional Parity Bonds are issued may provide for the deposit of moneys to a reserve account (other than the Debt Service Reserve Account) established and maintained for such Additional Parity Bonds on substantially the same terms as provided in Section 5E hereof and contain a covenant by the City to maintain such reserve fund or account in an amount equal to ten percent (10%) of the proceeds of the Additional Parity Bonds, except as may be necessary to comply with such statute or regulation. Any such reserve account shall have a claim to the Net Pledged Revenues equal to and on a parity with that of the Debt Service Reserve Account. Section 8. Covenants. The City hereby particularly covenants and agrees with the Owners of the Bonds from time to time, and makes provisions which shall be a part of its contract with such Owners, which covenants and provisions shall be kept by the City continuously until all of the Bonds have been fully paid and discharged: 10 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 and accounts referred to herein. The City shall permit AMBAC Indemnity to have access to and make copies of all such books and records of account at any reasonable time and to discuss with appropriate City officials the affairs, finances and accounts of the City or any other information AMBAC Indemnity may reasonably request regarding the security for the Bonds. P. Use of Principal and Interest Account and Debt Service Reserve Account. The Principal and Interest Account and the Debt Service Reserve Account shall be used solely and only for the purpose of paying the Debt Service Requirements of the Bonds (including any Guaranty Obligations incurred by the Enterprise) , any Additional Parity Bonds and any other Parity Securities to their respective Maturity Dates or any Redemption Date or Redemption Dates on which the City is obligated to redeem Bonds, subject to Section 9 hereof. AA. Information and Notices. While the Surety Bond is in effect the City shall also provide to AMBAC Indemnity the following: as soon as practicable, a copy of any financial statement, audit or annual report of the City, a copy of any notice to be given to the Owners of the Bonds or any certificate rendered pursuant to this Ordinance relating to security for the Bonds and such additional information relating to the City or the Enterprise as AMBAC Indemnity may reasonably request; and immediately, notification of any insufficiency of Net Pledged Revenues to make any payments of Debt service Requirements when due and notification of the occurrence of an Event of Default or any payment default under any related security document. Section 9. Defeasance. When all Debt Service Requirements of the Bonds have been duly paid and all Guaranty Obligations incurred by the Enterprise have been duly paid, the pledge and lien and all obligations hereunder shall thereby be discharged and the Bonds shall no longer be deemed to be Outstanding within the meaning of this Ordinance. There shall be deemed to be such due payment of the Bonds when the City has placed in escrow or in trust with a Trust Bank, located within or without the State, moneys or Federal Securities in an amount sufficient (including the known minimum yield available for such purpose from Federal Securities in which such amount wholly or in part may be initially invested) to pay all Debt Service Requirements of the Bonds as the same become due. The Federal Securities shall become due prior to the respective times at which the proceeds thereof shall be needed, in accordance with a schedule established and agreed upon between the City and such bank at the 11 time of the creation of the escrow or trust, or the Federal Securities shall be subject to redemption at the option of the Owner thereof to assure such availability as so needed to meet such schedule. Nothing herein shall be construed to prohibit a partial defeasance of the Outstanding Bonds in accordance with the provisions of this Section 9. Section 10. Default Provisions and Remedies of Bond Owners. B. Remedies 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 Owner or Owners 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 Owner of Bonds under this Ordinance by mandatory injunction or by other suit, action, or special proceedings in equity or at law, in any court of competent jurisdiction, either for the appointment of a receiver or an operating trustee or for the specific performance of any covenant or agreement contained herein or for any proper legal or equitable remedy as such Owner or Owners may deem most effectual to protect and to enforce the rights aforesaid, or thereby to enjoin any act or thing which may be unlawful or in violation of any right of any Owner of any Bond, or to require the City to act as if it were the trustee of an expressed trust, or any combination of such remedies, or as otherwise may be authorized by any statute or other provision of law. All such proceedings at law or in equity shall be instituted, had and maintained for the equal benefit of all Owners of the Bonds, and any Additional Parity Bonds or other Parity Securities then Outstanding. Any receiver or operating trustee appointed in any proceedings to protect the rights of such Owners hereunder may collect, receive and apply all Income 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. Upon a failure of the Enterprise to pay AMBAC Indemnity any Guaranty obligations incurred by the Enterprise, AMBAC Indemnity shall be entitled to exercise any and all remedies available at law or hereunder other than remedies which might adversely affect the Owners of the Bonds. H. Rights of AMBAC Indemnity. so long as AMBAC Indemnity is not then in default under the Surety Bond, no action requiring the consent of any Owners shall be initiated or approved without the prior written consent of AMBAC Indemnity. 12 Section 11. Amendment of Ordinance. A. Amendment of Ordinance Not Reauirina Consent of Bond Owners. The Exoept as hereinafter provided, the City may, with the prior written consent of AMBAC Indemnity but without the consent of, or notice to, the Owners of the Bonds, adopt such ordinances supplemental hereto (which amendments shall thereafter form a part hereof) for any one or more or all of the following purposes: (1) To cure or correct any formal defect, ambiguity or inconsistent provision contained in this Ordinance; (2) To appoint successors to the Paying Agent, Registrar, Transfer Agent, Securities Depository or Escrow Bank; (3) To designate a trustee for the Owners of the Bonds, to transfer custody and control of the Income to such trustee, and to provide for the rights and obligations of such trustee; (4) To add to the covenants and agreements of the City or the limitations and restrictions on the City set forth herein; (5) To pledge additional revenues, properties or collateral to the payment of the Bonds; 6 To cause this Ordinance to comply with the ( ) P Y Trust Indenture Act of 1939, as amended from time to time; or (7) To effect any such other changes hereto which do not in the opinion of nationally recognized bond counsel materially adversely affect the interests of the Owners of the Bonds. B. Amendment of Ordinance Reauirina Consent of Bond Owners. Exclusive of the amendatory ordinances covered by Section 11A hereof, this Ordinance may be amended or modified by ordinances or other instruments duly adopted by the City Council, without receipt by it or any additional consideration, but with the written consent of the Owners of sixty-six percent (66%) in aggregate principal amount of the Bonds then Outstanding at the time of the adoption of such amendatory ordinance and of AMBAC Indemnity, provided that no such amendatory resolution shall permit: (1) Changing Payment. A change in the maturity or in the terms of redemption of the principal of any Outstanding Bond or any interest thereon; or 13 (2) Reducing Return. A reduction in the principal amount of any Bond or the rate of interest thereon without the consent of the Owner of the Bond; or (3) Prior Lien. The creation of a lien upon or a pledge of revenues ranking prior to the lien or to the pledge created by this Ordinance; or (4) Modifying Amendment Terms. A reduction of the principal amount or percentages of Bonds, or any modification otherwise affecting the description of Bonds, otherwise changing the consent of the Owners of Bonds, which may be required herein for any amendment hereto; or (5) Priorities Between Bonds. The establishment of priorities as between Bonds issued and Outstanding under the provisions of this Ordinance; or (6) Partial Modification. Any modifications otherwise materially and prejudicially affecting the rights or privileges of the Owners of less than all of the Bonds then Outstanding. Whenever the Council proposes to amend or modify this Ordinance under the provisions of this Section 11B it shall give notice of the proposed amendment by mailing such notice to the Purchaser, or to any successor thereof known to the City Clerk, and to all Owners of Bonds at the addresses appearing on the registration books of the City. Such notice shall briefly set forth the nature of the proposed amendment and shall state that a copy of the proposed amendatory ordinance or other instrument is on file in the office of the City Clerk for public inspection. Section 12 . Miscellaneous. A. Delegated Duties. The officers of the City and of the Enterprise are hereby authorized and directed to enter into such agreements and take all action necessary or appropriate to effectuate the provisions of this Ordinance and to comply with the requirements of law, including, without limitation: (1) Printing. The printing of the Bonds, including the printing upon each such Bond of a copy of the approving legal opinion of Ballard Spahr Andrews & Ingersoll, bond counsel, duly certified by the Registrar, and, if necessary or desirable, the preparation of typewritten Bonds as provided herein; (2) Execution. Authentication. Registration and Delivery. The execution, authentication and registration of 14 the Bonds and the delivery of the Bonds to the Purchaser pursuant to the provisions of this Ordinance; (3) Information. The assembly and dissemination of financial and other information concerning the City and the Bonds; (4) Official Statement. The preparation of a final official statement for the use of prospective buyers of the Bonds, including, without limitation, the Purchaser and its associates, if any; and (5) ^tea Documents and Certificates. The execution of the Letter of Representations, the Escrow Agreement, the Surety Bond Commitment, the Guaranty Agreement and such certificates as may be reasonably required by the Purchaser, relating, inter alia, to: (a) The signing of the Bonds; (b) The tenure and identity of the officials of the City; (c) If in accordance with fact, the absence of litigation, pending or threatened, affecting the validity of the Bonds; (d) The tax treatment of interest on the Bonds under federal and State income tax laws; (e) The delivery of the Bonds and the receipt of the Bond purchase price; and (f) The accuracy and completeness of information provided in the official statement prepared for prospective buyers of the Bonds. M. Notice Address of AMBAC Indemnity. Any notices required or permitted to be given to AMBAC Indemnity hereunder shall be addressed as follows: AMBAC Indemnity Corporation One State Street Plaza New York, New York 10004 15 INTRODUCED, READ, APPROVED ON FIRST READING, AND ORDERED PUBLISHED BY NUMBER AND TITLE ONLY this 29th day of July, 1997. CITY OF F LLIN , CO RADO By: (CITY) Mayor (SEAL) ATTEST: a City Clerk 16 READ, FINALLY PASSED ON SECOND READING, AND ORDERED PUBLISHED BY NUMBER AND TITLE ONLY this 5th day of August, 1997. CITY OF FO COLLINS, COLORADO By: (CITY) Mayor (SEAL) TEST: City Clerk 17