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HomeMy WebLinkAbout015 - 05/16/1965 - AUTHORIZING THE ISSUANCE THE CITY'S NEGOTIABLE SEWER REFUNDING AND IMPROVEMENT REVENUE BONDS, SERIES j ORDINANCE NO I5,, 1965 { AN ORDINANCE AUTHORIZING THE ISSUANCE BY THE CITY OF FORT COLLINS, COLORADO, OF THE CITY' S NEGOTIABLE, COUPON "CITY OF FORT COLLINS, COLORAD09 SEWER REFUND- ING AND IMPROVEMENT REVENUE BONDS, SERIES JUNE 1, 1965" IN THE AGGREGATE PRINCIPAL AMOUNT OF $22492 000 00 , PROVIDING FOR THE REFUNDING, PAYMENT AND DISCHARGE AT THEIR RESPECTIVE MATURITIES OF THE CITY' S OUTSTANDING REVENUE BONDS PAYABLE OUT OF AND SECURED BY A PLEDGE OF REVENUES TO BE DERIVED FROM THE OPERATION OF THE CITY'S MUNICIPALLY OWNED AND OPERATED SEWER SYSTEM, AUTHORIZING THE DEPOSIT OF FUNDS SO TO REDEEM SUCH OUTSTANDING BONDS, AUTHOR- IZING THE IMPROVEMENT AND EXTENSION OF SAID SEWER SYSTEM BY THE CONSTRUCTION AND OTHER ACQUISITION OF ADDITIONAL SEWAGE COLLECTION AND TREATMENT FACILI- TIES AND EVERYTHING NECESSARY OR INCIDENTAL THERE- TO, AUTHORIZING THE ISSUANCE OF SUCH BONDS IN ANTI- CIPATION OF THE COLLECTION OF REVENUES OF SUCH SYSTEM FOR SUCH IMPROVEMENTS AND EXTENSIONS, PROVIDING THE FORM, TERMS AND CONDITIONS OF THE SEWER REFUNDING AND IMPROVEMENT BONDS, THE MANNER OF THEIR EXECUTION, THE METHOD OF PAYING THEM, AND THE SECURITY THEREFOR, PROVIDING FOR THE COLLECTION AND DISPOSITION OF REVENUES DERIVED AND TO BE DERIVED FROM SAID SEWER SYSTEM, PROVIDING OTHER DETAILS CONCERNING THE REFUND- ING AND IMPROVEMENT BONDS, SAID SEWER SYSTEM, THE BONDS TO BE REFUNDED, AND FUNDS APPERTAINING THERETO, INCLUDING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS IN CONNECTION THEREWITH, RATIFYING ACTION PREVIOUSLY TAKEN AND PROVIDING THE EFFECTIVE DATE HEREOF WHEREAS, the City of Fort Collins (herein sometimes designated as the "City") , in the County of Larimer and State of Colorado, is a political subdivision of the State, -2- a body corporate and politic and a home rule city with a "Council-Manager government" pursuant to Article XX of the Constitution of the State of Colorado and the Charter of the City (herein sometimes designated as the "Charter") , and WHEREAS, the City now owns , operates and maintains a municipal sanitary sewer system (herein sometimes desig- nated as the "sewerage facilities," as the "sewer system" or merely as the "system") , and WHEREAS, the City Council of the City (herein some- times designated as the "Council") has determined, and does hereby declare, that the interest of the City and of the in- habitants thereof, and the public interest and necessity demand the improvement and extension of the municipally owned and operated sewer system by the construction and other acqui- sition of additional sewage collection and treatment facili- ties and everything necessary and incidental thereto at a coS-t which is estimated not to exceed $2 ,200,000 00, excluding any cost to be defrayed from any source other than bond proceeds (herein sometimes designated as the "Improvement Project") , and WHEREAS, Section 20 Part II, Article I of the Charter, as amended, provides in relevant part "Section 20 Indebtedness and Limitations Indebtedness and obligations against the City shall be incurred and limited as provided in Article XI of the Constitution of the State of Colorado, provided that in determining the limitation of the City' s power to incur indebtedness there shall not be included bonds issued to evidence debts contracted for supplying water to such City or for the acquisition or extension of public utilities, enterprises works, or ways from which the City will derive revenue , and provided fur- ther, that no general obligation bonds shall be issued without the vote of the taxpaying electors and no revenue bonds shall be issued without the vote of the qualified electors, except as follows "(c) The Council shall have the power to issue bonds to finance the improvement or extension of a -3- i municipally owned and operated utility, if said bonds shall be payable solely out of revenue to be derived from the operation of such utility " and WHEREAS, Section 6, Article IX of said Charter provides in relevant part as follows "The Council shall by ordinance from time to time fix, establish, maintain, and provide for the collec- tion of such rates, fees, or charges for water and electricity, and for water, sewer, and electric ser- vice furnished by the City as will produce revenues sufficient to pay the cost of operation and maintenance of said utilities in good repair and working order, to pay the principal of and interest on all bonds of the City payable from the revenues of said utilities , to provide and maintain an adequate fund for replacement of depreciated or obsolescent property, to provide a fund for the extension, improvement, enlargement, and betterment of said utilities , to pay the interest on and principal of any general obligation bonds issued by the City to extend or improve said utilities The provisions hereof shall be subject at all times to the performance by the City of all covenants and agreements made by it in connection with the issuance, sale, or delivery of any bonds of the City payable out of the revenues derived from the operation of its water, electric, and other utilities, whether such revenue bonds be heretofore or hereafter issued "Any surplus revenue produced from the operation of any utilities after meeting all the requirements set forth above shall be paid into the general fund of the City in lieu of taxes " and WHEREAS, the sole outstanding bonds payable from, and the payment of which is secured by a pledge of, revenues derived from the operation of the sewer system, or any part -4- l thereof, are the bonds validly issued pursuant to proceed- ings duly had and taken of the following issues (herein sometimes collectively designated as the `outstanding bonds") 1 The City of Fort Collins Sewerfand Water P Revenue Bonds, dated March 1, 1948 (herein sometimes designated as the "1948 revenue bonds") , issued pur- suant to Ordinance No 5-1948, finally adopted and approved on the 24th day of June, 1948 (herein some- times designated as the "1948 bond ordinance") author- ized and issued in the original principal amount of $195 ,000 00, consisting of 195 bonds in the denomina- tion of $1,000 00 each, numbered consecutively from 1 to 195 , both inclusive, bearing interest at the rate of two and three-fourths per centum (2-3/47) per annum, payable semiannually on the first days of March and September of each year, according to interest coupons attached to said bonds, and being numbered and matur- ing serially on March 1, as follows Bond Numbers Amounts Years (All Inclusive) Maturing Mat riu—ng 1 - 5 $52000 00 1949 6 - 10 5 ,000 00 1950 11 - 15 5,000 00 1951 16 - 20 52000 00 1952 21 - 25 51000 00 1953 26 - 30 51000 00 1954 31 - 35 59000 00 1955 36 - 40 52000 00 1956 41 - 45 5 ,000 00 1957 46 - 51 6,000 00 1958 52 - 57 69000 00 1959 58 - 63 61000 00 1960 64 - 80 172000 00 1961 81 - 98 18,000 00 1962 99 - 117 192000 00 1963 118 - 136 19 000 00 1964 137 - 155 192000 00 1965 156 - 175 202000 00 1966 176 - 195 201000 00 1967 Both principal of and interest on said bonds are pay- able in lawful money of the United States of America, at the office of the City Treasurer in Fort Collins, -5- Colorado Bonds maturing from 1954 to 1967, both inclu- sive, are redeemable at the option of the City on March 11, 1953, and on any interest payment date there- after Any redemptions made prior to March 1, 1958, shall be made at par and a premium of 2-1/27 of prin- cipal On March 1, 1958, and thereafter, redemptions before maturity shall be made at par without premium Redemptions shall be made in inverse numerical order Said bonds are payable solely and only out of the net revenue to be derived by the City from and through the operation of the sewer system, and, if necessary, out of the net revenue to be derived from the operation of its water system There are now outstanding and unpaid bonds of said issue in the principal amount of $35,000 00, consisting of bonds numbered 156 to 170, both inclusive, maturing serially on the first day of March in the year 1966, and bonds numbered 176 to 195 , both inclu- sive, maturing serially on the first day of March in the year 1967 , and 2 The "City of Fort Collins Sewer Improvement Revenue Bonds, Series January 1, 1959" (herein some- times designated as the "1959 revenue bonds") , issued pursuant to Ordinance No 36, 1958, finally adopted and approved on the 26th day of November , 1958 (herein sometimes designated as the "1959 bond ordinance") , authorized and issued in the original principal amount of $300,000 00, bearing date as of the first day of January, 1959, consisting of 300 bonds in the denomina- tion of $1,000 00 each, numbered from 1 to 300, both inclusive, bearing interest until their respective maturities at the rate of three and one-quarter per centum (3-1/47) per annum payable semiannually on the first days of January and July in each year com- mencing on the first day of July, 1959 and being numbered and maturing serially in regular numerical order on the first day of January in each of the designated years, as follows -6- Bond Numbers Amounts Years (All Inclusly-e) tl�a uring Maturing 1 - 6 $69000 00 1960 7 - 12 62000 00 1961 13 - 19 7 ,000 00 1962 20 - 26 7,000 00 1963 27 - 34 81000 00 1964 35 - 43 92000 00 1965 44 - 57 142000 00 1966 58 - 68 11,000 00 1967 69 - 99 31,000 00 1968 100 - 131 32,000 00 1969 132 - 164 33,000 00 1970 165 - 197 339000 00 1971 198 - 231 342000 00 1972 232 - 265 342000 00 1973 266 - 300 352000 00 1974 bonds numbered 132 to 300, both inclusive, maturing on and after the first day of January, 1970, being subject to prior redemption, at the option of the City of Fort Collins, in inverse numerical order, on the first day of January, 1969, or on any interest p.Ayment date thereafter prior to maturity, upon payment of the prin- cipal amount thereof, plus accrued interest to the redemption date, and a premium consisting of three per centum (37) of such principal amount, the 1959 revenue bonds being payable both as to principal and interest solely from the net revenues derived from the operation of the municipal sewer system, in lawful money of the United States of America, without deduction for exchange or collection charges, at the office of the Director of Finance and ex-officio City Treasurer, Fort Collins, Colorado, of which issue there are now outstanding and unpaid bonds in the principal amount of $257,000 00, consisting of bonds numbered 44 to 300, both inclusive, maturing serially on the first day of January in each of the years 1966 to 1974, both inclusive, and WHEREAS, except for the 1948 revenue bonds and the 1959 revenue bonds, the City has never pledged nor in any way hypothecated the revenues derived or to be derived from the operation of the sewer system to the payment of outstanding -7- bonds or for any other purpose, with the result that the revenues to be derived from the operation of the system may now be pledged lawfully and irrevocably for the redemption of the bonds herein authorized (herein sometimes designated as the "1965 revenue bonds," as the "refunding and improve- ment bonds," or merely as the 'bonds") , and WHEREAS, Article 52 of Chapter 139, Colorado Revised Statutes 1963 (commonly designated as the "Water and Sewer Revenue Bond Act of Colorado" and herein sometimes designated merely as the "Bond Act") authorizes any Colorado municipality, including the City, to issue sewer refunding revenue bonds to refund, pay or discharge all or any part of its outstanding sewer revenue bonds, theretofore or thereafter issued thereunder or under any other law, includ- ing any interest thereon, in arrears or about to become due, or for the purpose of reducing interest costs or effecting other economies or of modifying or eliminating restrictive contractual limitations appertaining to the issuance of additional bonds or to any municipal sewerage facilities as provided in the Bond Act , and WHEREAS, the Bond Act authorizes the acquisition, construction, reconstruction, lease, improvement, better- ment and extension of any sewerage facility by the City and the issuance of revenue bonds to pay in whole or in part the cost thereof, and WHEREAS, Section 139-52-12(5) , Bond Act, provides in substance that bonds for refunding and bonds for any other purpose or purposes authorized in Article 52, Chapter 139, C R S , 1963, may be issued separately or issued in combination in one series or more, and WHEREAS, Section 139-52-12(4) , Bond Act, provides that refunding revenue bonds may be made payable from any revenues derived from the operation of any water facilities or sewerage facilities or of both water facili- ties and sewerage facilities comprising a ,joint water and sewer system, notwithstanding the pledge of any such reve- nues for the payment of the outstanding bonds issued by the municipality which are to be refunded is thereby modified, and -8- � WHEREAS, the Council has determined and does hereby declare that it is necessary to pledge only the revenues to be derived from the operation of the City' s sewer system as security for the 1965 revenue bonds to be issued and not to pledge any revenues of the City' s water system and WHEREAS, such pledge of sewer revenues would have to be junior in lien to the 1948 revenue bonds and the 1959 revenue bonds by reason of the restrictive contractual limi- tations of the 1948 bond ordinance and the 1959 bond ordi- nance, thereby increasing the cost to the City of issuing bonds to effect improvements and extension to its sewer system and WHEREAS, the interest costs on the refunding por- tion of the 1965 revenue bonds will not be greater than the interest costs on the 1948 revenue bonds and the 1959 revenue bonds and WHEREAS, the Council has considered found, and determined, and does hereby declare (1) That the City proposes to pay after the first day of June, 1965 , the interest on and the principal of 1948 revenue bonds numbered 156 to 170, both inclusive, and 176 to 195 , both inclusive in the aggregate princi- pal amount of $35 000 00, and the interest on and the principal of 1959 revenue bonds numbered 44 to 330, both inclusive, in the aggregate principal amount of $257 ,000 00, at their respective maturities , with $292 ,000 00 of the proceeds of the 1965 revenue bonds (herein sometimes designated as "Subseries R") , together with the revenues derived prior to their delivery from the operation of the sewer system, and available for use as herein provided, to the extent necessary including but not necessarily limited to moneys accumulated in any bond sinking fund and any reserve fund for the designated outstanding 1948 reve- nue bonds and 1959 revenue bonds (excluding operation and maintenance funds) and interest or other yield from the investment and any reinvestment of the pro- ceeds of Subseries R (except as limited by the Bond 9- Act as from time to time amended) in bills, certifi- cates of indebtedness, notes, bonds, or similar obli- gations of, or the principal and interest of which are unconditionally guaranteed by, the United States of America , (2) That by issuing Subseries R of the 1965 revenue bonds for the purpose of refunding, paying and discharging the outstanding bonds as herein pro- vided, the City will (a) Reduce substantially the interest costs of the outstanding bonds, which obligations are to be re-evidenced by Subseries R of the 1965 revenue bonds, and (b) Effect economies in the issuance of that portion of 1965 revenue bonds the proceeds of which will be used to improve and extend the sewer system (herein sometimes designated as "Subseries I") , and (c) Eliminate or otherwise modify restric- tive contractual limitations appertaining to the outstanding bonds and to the sewer system to the best advantage of the City, (3) That each 1948 revenue bond and 1959 revenue bond shall mature within ten years from the date of the issuance of the 1965 revenue bonds, (4) That the maturity of no 1948 revenue or 1959 revenue bond to be refunded will be extended over fif- teen (15) years, (5) That the interest on no 1948 revenue bond or 1959 revenue bond to be refunded will be increased by the issuance of the 1965 revenue bonds herein authorized, (6) That bonds numbered R-1 to R-9, both inclu- sive, of Subseries R of the 1965 revenue bonds will be issued on terms at least as favorable to the City as the outstanding 1948 revenue bonds and bonds numbered R-9 to R-60, both inclusive, of Subseries R of the 1965 revenue bonds will be issued on terms at least as favorable to the City as the outstanding 1959 revenue bonds , -10- (7) That the principal amount of Subseries R of the 1965 revenue bonds representing the portion of the proceeds applied to refunding shall not exceed the out- standing principal amount of the 1948 revenue bonds and 1959 revenue bonds to be refunded, (8) That the proceeds of Subseries R of the 1965 revenue bonds shall be placed in escrow to be applied to the payment of the 1948 revenue bonds and the 1959 revenue bonds to be refunded at the dates heretofore provided upon their presentation therefor, (9) That , except as limited by the Bond Act , as from time to time amended, the escrowed proceeds, pend- ing such use, shall be invested and possibly reinvested in bills certificates of indebtedness, notes, bonds , or similar obligations of, or the principal and inter- est of which are unconditionally guaranteed by, the United States of America, (10) That such escrowed proceeds and investments, together with interest or other yield to be derived from such investments, shall be in an amount at all times sufficient to pay the outstanding 1948 revenue bonds and 1959 revenue bonds to be refunded as they become due as aforesaid, as to principal and interest and any charges of the escrow agent payable therefrom (11) That the limitations imposed in the Bond Act and the Charter of the City of Fort Collins upon the issuance of the 1965 revenue bonds have herein been met , and (12) That it is one of the specific intents and purposes of this ordinance (a) To authorize the issuance of the 1965 revenue bonds in such manner as not to affect adversely the rights or remedies of any owner or holder of any outstanding 1948 revenue bond or 1959 revenue bond, nor to affect adversely the security pledged to the payment thereof, and -11- i (b) To satisfy all liens of the outstanding 1948 revenue bonds and 1959 revenue bonds on any revenues derived or to be derived from the opera- tion of the system or any part thereof, and all pledges of such revenues to secure the payment thereof and WHEREAS, it is desirable to authorize 1965 revenue bonds in the aggregate principal amount of $2,492,000 00, the proceeds of Subseries R in the aggregate principal amount of $292,000 00 to be applied to the refunding of the out- standing bonds, the balance, being the proceeds of Subseries I in the aggregate principal amount of $2,200,000 00, to be used for effecting the improvement and extension of the City' s sewer system, and to authorize the public sale of Subseries R and Subseries I to the highest and best bidder for each subseries, but in no event for less than par, and in all cases to the best advantage of the City NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS Section 1 Short Title That this ordinance may be designated by the short title "6-1-65 sewer revenue bond ordinance " Section 2 Meanings and Construction A Definitions That the terms in this section defined for all purposes of this ordinance and of any ordinance amendatory hereof or supplemental hereto, or relating hereto, and of any instrument or document appertaining hereto, except where the context by clear implication otherwise requires, shall have the meanings herein specified (1) "Bond Act" means the act authorizing the issuance of the bonds herein authorized, which act is commonly designated as the "Water and Sewer Revenue Bond Act of Colorado," is sometimes cited as Article 52, Chapter 139, Colorado Revised Statutes 1963, and is more -12- specifically cited as Sections 139-52-1 to 139-52-17 , both inclusive, Colorado Revised Statutes 1963 (2) "Bond Fund" or "1965 Bond Fund" means the "City of Fort Collins, Colorado, Sewer Refund- ing and Improvement Revenue Bonds, Series June 1, 1965 , Interest and Bond Retirement Fund," created in paragraph B of Section 19 hereof (3) "Bonds," "1965 revenue bonds," or "refund- ing and improvement bonds" means those issued hereunder and consists of the Improvement Bonds, as herein defined (also desigra ted as "Subseries I") and the Refunding Bonds, as herein defined (also designated as "Subseries R") The 1965 revenue bonds (consisting of both designated subseries) are designated as the "City of Fort Collins, Colo- rado, Sewer Refunding and Improvement Revenue Bonds, Series June 1, 1965 " (4) "Charter" means the Charter of the City of Fort Collins, Colorado, adopted October 5 , 1954, as amended (5) "City" means the City of Fort Collins, in the County of Larimer and State of Colorado (6) "City Clerk" means the de facto or de jure City Clerk of the City (7) "City Council" or "Council" means the city council of the City, or any succeeding legis- lative body of the City (8) "City Engineer" means the de facto or de jure head of the Department of Public Works and ex-officio City Engineer (9) "City Manager" means the de facto or de jure city manager of the City (10) "Council" means City Council (11) "Construction Fund" or "1965 Construc- tion Fund" means the City of Fort Collins, Colo- rado, Sewer Refunding and Improvement Revenue Bonds, Series June 1, 1965 , Construction and Other Acquisition Fund," created in Section 16D hereof -13- (12) "Consulting Engineer" means the City Engineer, as herein defined, or any registered or licensed professional engineer, or firm of such engineers, having a wide and favorable repute for skill and experience in the field of designing preparing plans and specifications for, and supervising construction of sewer systems and facilities, entitled to practice and practicing as such under the laws of the State of Colorado, retained and compensated by the City, but (except for the City Engineer) not in the regular employ of the City (13) "Coupons" means those issued hereunder and evidencing the interest on the applicable bond or bonds (14) "Director of Finance" means the Director of Finance who is executive officer of the Depart- ment of Finance pursuant to Section 22 , Part III, Article V of the Charter and who is in effect the City Treasurer (15) "Escrow Agent" means the commercial bank and trust company designated as THE FIRST_ NATTnXAr gAXX located in the City of Fort Collins, County of Larimer and State of Colorado, as stated in paragraph B of Section 16 hereof (16) "Event of default" means any of the events stated in Section 35 hereof (17) "Federal securities" means (except as limited by Section 139-52-12(3) , Bond Act, as from time to time amended) the bills, certificates of indebtedness notes, bonds, or similar obligations which are direct obligations of, or the principal and interest of which obligations are uncondition- ally guaranteed by, the United States of America, as provided in paragraph B of Section 20 hereof -14- (18) "Fiscal Agent" means Boettcher and Company, Denver, Colorado, which firm has been employed by the City as fiscal advisor in con- nection with the "bonds," as herein defined, and also means any successor, direct or intermediate, of that firm (19) "Fiscal Year" for the purposes of this ordinance, means the twelve (12) months commencing on the first day of January of any calendar year and ending on the last day of December of the same year, as provided in Section 17 hereof and Section 1, Part I, Article V, of the Charter (20) "Gross income" or "gross revenues" means "revenues," as herein defined (21) "Hereby," "here in," "hereinabove," "hereinafter," "hereinbefore," "hereof," and "hereunder," or any similar term refer to this ordinance and not solely to the particular portion thereof in which such word is used, "heretofore" means before the adop- tion of this ordinance, and "hereafter" means after the adoption of this ordinance (22) "Holder" or any similar term when used in conjunction with any coupons or bonds, means the person in possession and the apparent owner of the designated item (23) "Improvement Bonds" means that portion of the 1965 revenue bonds which is designated as Subseries I as herein defined (24) "Improvement Project" means the improve- ment and extension of the municipally owned and operated sewer system by the construction and other acquisition of additional sewage collection and treatment facilities and everything necessary or incidental thereto, in the manner herein provided, from the proceeds of Subseries I of the 1965 revenue bonds -15- (25) "Income" means "revenues , " as herein defined (26) "Independent Accountant" means any regis- tered accountant, any certified public accountant, or firm of such registered accountants or such cer- tified public accountants , or of both, as determined at the option of the City, duly licensed to practice and practicing as such under the laws of the State of Colorado, appointed and paid by the City (1) Who is, in fact, independent and not under the domination of the City, (2) Who does not have any substantial interest, direct or indirect, with the City, and _ (3) Who is not connected with the City as an officer or employee of the City, but who may be regularly retained to make annual or similar audits of the books or records of the City (27) "Insured Bank" means a bank which is a member of the Federal Deposit Insurance Corporation (28) "Mayor" means the de facto or de jure Mayor of the City (29) "Minimum Reserve" means the amount to be deposited, accumulated and maintained in the 1965 Reserve Fund by paragraph C of Section 19 hereof, which amount is the sum of $180,000 00 (30) "Net revenues" or "net income" means the revenues after deducting "operation and maintenance expenses " (31) "Newspaper" means a newspaper printed in the English language, published at least once each calendar week, and of general circulation in the City (32) "1959 Bond Fund" means the "City of Fort Collins Sewer Improvement Revenue Bonds , Series January 1, 1959, Interest and Bond Retirement Fund" created in Section 11E of the 1959 bond ordinance -16- (33) "1959 bond ordinance" means Ordinance No 36, 1958 by which the 1959 revenue bonds were authorized to be issued (34) "1959 Reserve Fund" means the "City of Fort Collins Sewer Improvement Revenue Bonds Series January 1, 1959 , Reserve fund," created in Section 11F of the 1959 bond ordinance (35) "1959 revenue bonds" means the "City of Fort Collins Sewer Improvement Revenue Bonds, Series January 1, 1959," in the original principal amount of $300,000 00, dated January 1, 1959 , and issued pursuant to the 1959 bond ordinance, of which 1959 revenue bonds in the amount of $257 ,000 00 are still outstanding (36) "1948 Bond Fund" means the "Sewer and Water Bond Fund" created in Section 6 of the 1948 bond ordinance (37) "1948 bond ordinance" means Ordinance No 5-1948 , by which the 1948 revenue bonds were authorized to be issued (38) "1948 Reserve Fund" means the "Reserve Fund" created in Section 6(c) of the 1948 bond ordinance (39) "1948 revenue bonds" means the City of Fort Collins Sewer and Water Revenue Bonds, in the original principal amount of $195 000 00, dated March 1, 1948, and issued pursuant to the 1948 bond ordinance, of which 1948 revenue bonds in the amount of $35 ,000 00 are still outstanding (40) "1965 Bond Fund" means the "Bond Fund," as herein defined (41) "1965 Construction Fund" means the Construction Fund, as herein defined (42) "1965 revenue bonds" means "bonds," as herein defined (43) 1°1965 Reserve Fund" means the "Reserve Fund," as herein defined -17- (44) "Operation and maintenance expenses" (or a phrase of similar import) means all reason- able and necessary current expenses of the City, paid or accrued, of operating, maintaining and repairing the system, and the term may include at the City' s option (except as limited by law) , without limiting the generality of the foregoing, legal and overhead expense of the various city departments directly related and reasonably allo- cable to the administration of the system, insur- ance premiums, the reasonable charges of any depositary bank or paying agent, contractual ser- vices, professional services required by this ordinance, salaries and administrative expenses, labor, and the cost of materials and supplies used for current operation, but shall not include any allowance for depreciation, liabilities incurred by the City as the result of its negligence in the operation of the system, or other ground of legal liability not based on contract, and shall not include the costs of improvements, extensions, enlargements or betterments, or any charges for the accumulation of reserves for capital replace- ments (45) "Outstanding" when used with reference to bonds of the City and as of any particular date, means all bonds of the City payable from revenues of the system and theretofore and there- upon being executed and delivered, except (a) Any bond cancelled or paid by or on behalf of the City at or before said date, and (b) Any bond for the payment or the redemption of which money equal to the prin- cipal amount thereof, any prior redemption premium due in connection therewith, and interest thereon to the date of maturity or -18- to any redemption date, shall have theretofore been deposited with the Paying Agent or a bank as provided in Section 39 hereof (46) "Parity bonds" or "parity obligations" means bonds or obligations payable from revenues of the system on a parity with the 1965 revenue bonds (47) "Paving Agent" means the office of the Director of Finance who serves as the ex-officio City Treasurer, in the City of Fort Collins, Colorado (48) "Person" means not only a natural per- son, corporation or other legal entity, but also two or more natural persons, corporations or other legal entities acting ,jointly as a firm, partner- ship, unincorporated association, joint adventurers, or otherwise (49) "Proiect" means the Refunding Project and Improvement Project together, as herein defined (50) "Purchaser" means the investment banking firm or other person submitting the best bid for any subseries or other block herein authorized and separately offered for sale, which bid is hereafter accepted by the City, or if any sub- series or other block be purchased by more than one person, "Purchaser" means the manager of the purchasing syndicate (51) "Redemption date" means the date fixed for the redemption prior to their respective maturities of bonds in any notice of redemption (52) "Refunding and Improvement Bonds" means "bonds," as herein defined (53) "Refunding bonds" means that portion of the 1965 revenue bonds which is designated as Subseries R. as herein defined (54) "Refunding Fund" means the "City of Fort Collins, Colorado, Sewer Refunding and -19- Improvement Revenue Bonds , Series June 1, 1965, Refunding Fund," created in paragraph B of Section 16 hereof (55) "Refunding Project" means the refunding, payment and discharge, at the times and in the manner herein provided, of the 1948 bonds and the 1959 bonds in the total amount of $292,000 00 (56) "Reserve Fund" or "1965 Reserve Fund" means the "City of Fort Collins , Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965, Reserve Fund," created in paragraph C of Section 19 hereof (57) "Revenues ," "gross revenues," "income," or "gross income" from the system means all income and revenue derived by the City from the operation of the sewer system, or any part thereof, whether resulting from improvements , extensions , enlarge- ments, repairs or betterments thereto, or other- wise, and includes all revenues received by the City, or any municipal corporation succeeding to the rights of the City, from the system and from the sale and use of sewer service and sewerage facilities to the inhabitants of what is now the City (including all territorial annexations which may be made while the bonds herein authorized or any part thereof are outstanding) , or from the sale and use of sewer service and sewerage facilities by means of the system owned and operated by the City as the same may at any time exist to serve customers outside the city limits as well as customers within the city limits , provided, however, that the City's existing sewer trunk line assess- ments , sewer main line assessments, and sewer tap fees and the plant investment fees which the City will impose by Ordinance No 17, 19 5to be finally passed and adopted on the 15t6 day of April,; 1965, may, at the option of the City, not be included in "gross revenues" but may be credited to the City's existing Sewer Capital Improvement Fund -20- (58) "Sewer Capital Improvement Fund" means the City' s existing fund for capital improvements heretofore created (59) "Sewer Fund" or "Income Fund" means the "City of Fort Collins, Colorado, Sewer System Gross Income Fund" created in Section 18 hereof (60) "Sewer System," "sewerage facilities," "sewage facilities," or "system" means the City' s municipally owned sanitary sewer system, consist- ing of all properties , real, personal, mixed, or otherwise now owned or hereafter acquired by the City, through purchase, construction, or otherwise, and used in connection with the sanitary sewer system of the City, and in any way appertaining thereto, whether situated within or without the city limits, or both within and without the city limits (61) "Subordinate bonds" or "subordinate obligations" means bonds or obligations payable from revenues of the system subordinate and junior to the lien of the 1965 revenue bonds (62) "Subseries I" of the 1965 revenue bonds means that portion thereof to be issued for the purpose of improving and extending the municipally owned and operated sewer system by the construction and other acquisition of additional sewage collec- tion and treatment facilities and everything neces- sary or incidental thereto, and said bonds are sometimes designated as the "Improvement Bonds " (63) "Subseries R" of the 1965 revenue bonds means that portion thereof to be issued for the purpose of refunding, paying and discharging those outstanding 1948 revenue bonds and 1959 revenue bonds maturing on and after June 1, 1965 , in the principal amount of $292,000 00 , and said bonds are sometimes designated as the "Refunding Bonds " (64) "Superior bonds" or "superior obliga- tions" means bonds or obligations payable from -21- revenues of the system superior to the lien of the 1965 revenue bonds (65) "System" means the "sewer system," as herein defined B Construction That this ordinance, except where the context by clear implication herein otherwise requires, shall be construed as follows (1) Definitions imply both singular and plural (2) Pronouns include both singular and plural and cover all genders (3) Any percentage of bonds is to be figured on the unpaid principal amount thereof then out- standing Section 3 Ratification That all action hereto- fore taken (not inconsistent with the provisions of this ordinance) by the Council and the officers of the City directed toward (a) The Refunding Project and the Improvement Project, and (b) The issuance of the City' s 1965 revenue bonds for those purposes, be, and the same hereby is, ratified, approved and confirmed Section 4 Authorization of Refunding Project That the City' s outstanding 1948 revenue bonds and 1959 revenue bonds shall be, and the same hereby are ordered to be, refunded, paid and discharged, at the times and in the manner herein provided and the Refunding Project is hereby so authorized Section 5 Authorization of Improvement Project That the system shall be so improved and extended by the expenditure of not to exceed $2,200 000 00 excluding any cost of the Improvement Project defrayed or to be defrayed by any source other than revenue bond proceeds, and that said improvements and extensions have heretofore been and hereby are authorized and that the Improvement Project is hereby so authorized -22- Section 6 Estina ted Cost of Protects That the estimated cost of the Refunding Project is estimated not to exceed $292 ,000 00 and that the estimated cost of the Improvement Project is estimated not to exceed $2 ,200,000 00, excluding in each instance, any such cost defrayed or to be defrayed by any source other than bond proceeds Section 7 Authorization of Bonds That for the purpose of protecting the public health, conserving the property and advancing the general welfare of the citizens of the City, and for the purpose of defraying the cost of the Project, it is hereby declared necessary that the City make and issue, and there are hereby authorized to be issued, pursuant to the provisions of the Bond Act, the "City of Fort Collins , Colorado, Sewer Refunding and Improve- ment Revenue Bonds, Series June 1, 1965 ," in the principal amount of $2,492,000 00, payable both as to principal and interest solely out of the net income derived from the operation of the sewer system, and the City pledges irrevoc- ably, but not necessarily exclusively, such net income to the payment of the bonds and the interest thereon, the pro- ceeds thereof to be used solely for the Project, as herein provided Section 8 Bond Details That the 1965 revenue bonds shall be dated as of the first day of June, 1965 , be payable to bearer, be payable from the revenues herein desig- nated and pledged to the payment thereof, and bear interest at a rate or rates to be hereafter established after the public sale of the 1965 revenue bonds, interest being evidenced until their respective maturities by only one set of interest coupons payable to bearer and attached to the 1965 revenue bonds, both the principal of and the interest on the 1965 revenue bonds being payable in lawful money of the United States of America, without deduction for exchange or collec- tion charges, at the Paying Agent In the event any 1965 revenue bond shall not be paid upon its presentation at maturity, it shall continue to draw interest at the rate of six per centum (6/) per annum until the principal thereof is -23- paid in full The 1965 revenue bonds also consist of two subseries designated as Subseries I and as Subseries R, as follows A Subseries I The bonds comprising Subseries I shall consist of 440 bonds in the denomination of $5 ,000 00 each, issued for the Improvement Project in the principal amount of $2,200,000 00, numbered con- secutively in regular numerical order from I-1 to I-440, both inclusive, bearing interest at a rate or rates of not exceeding four and one-half per centum (4-1/27) per annum from their date until their respec- tive maturities, interest being payable on the first day of December, 1965 , and semiannually thereafter on the first days of June and December in each year, and the Improvement Bonds shall be numbered and mature serially in regular numerical order on the first day of December in each of the designated amounts and years, as follows Bond Numbers Amounts Years (All Inclusive) Maturing Maturing I- 1 to I- 10 $502000 00 1967 I- ll to I- 21 55 ,000 00 1968 I- 22 to I- 33 60,000 00 1969 I- 34 to I- 46 65 ,000 00 1970 I- 47 to I- 59 65 ,000 00 1971 I- 60 to I- 73 70,000 00 1972 I- 74 to I- 88 752000 00 1973 I- 89 to 1-112 120,000 00 1974 1-113 to 1-137 125 ,000 00 1975 1-138 to 1-162 125000 00 1976 I-163 to 1-188 130:000 00 1977 1-189 to 1-216 1401%000 00 1978 I-217 to 1-245 145 ,000 00 1979 1-246 to 1-275 150,000 00 1980 1-276 to 1-306 155 ,000 00 1981 1-307 to 1-338 160,000 00 1982 1-339 to 1-371 165,000 00 1983 1-372 to 1-405 170 000 00 1984 1-406 to 1-440 1752000 00 1985 and B Subseries R The bonds comprising Subseries R shall consist of 60 bonds in the denomination of $5 ,000 00 each, except for bonds numbered R-1 and R-2 , which shall be in the denomination of $1,000 00 each, issued for the -24- Refunding Project in the principal amount of $292,000 00, numbered consecutively in regular numerical order from R-1 to R-60, both inclusive, refunding bonds numbered R-1 to R-15 , both inclusive, bearing interest at a rate or rates not exceeding two and three-fourths per centum (2-3/47) per annum, and refunding bonds numbered R-16 to R-60, both inclusive, bearing interest at a rate or rates of not exceeding three and one-fourth per centum (3-1/47) per annum, interest being payable on the first day of December, 1965 , and semiannually there- after on the first days of June and December in each year, and the Refunding Bonds shall be numbered and mature serially in regular numerical order on the first day of June in each of the designated amounts and years, as follows Bond Numbers Amounts Years (All Inclusive) Maturing Pgtu g R- 1 to R- 8 $322000 00 1966 R- 9 to R-15 352000 00 1967 R-16 to R-22 352000 00 1968 R-23 to R-29 35 ,000 00 1969 R-30 to R-36 35 ,000 00 1970 R-37 to R-44 40,000 00 1971 R-45 to R-52 402000 00 1972 R-53 to R-60 402000 00 1973 Section 9 Prior Redemption A Subseries I That Improvement Bonds numbered I-1 to I-112 , both inclusive, maturing on and before the first day of December, 1974, shall be subject to redemption prior to their respective maturities, at the option of the City, in regular numerical order, on the first day of June, 19672 or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each bond so redeemed, accrued interest thereon to the redemption date and a premium consisting of five per centum (57) of the principal amount of each Improvement Bond so redeemed The prior redemption option hereinabove provided in this paragraph A of Section 9 shall not be exercised for the purpose of refunding the bonds called for prior -25- redemption without the specific written consent to such call by the holders of those bonds, except as herein- after provided For all purposes, including refunding, Improvement Bonds numbered I-113 to I-440, both inclu- sive, maturing on and after the first day of December, 1975, shall be subject to redemption prior to their respective maturities, at the option of the City, in inverse numerical order, on the first day of December, 1974, or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each bond so redeemed, accrued interest thereon to the redemption date, and a premium consisting of one per centum (1/) of the principal amount of each bond so redeemed B Subseries R That for all purposes, Refunding Bonds numbered R-1 to R-60, both inclusive, maturing on or before the first day of June, 1973, shall be subject to redemption prior to their respective maturities, at the option of the City, in regular numerical order, on the first day of December, 1965 or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each Refunding Bond so redeemed accrued interest thereon to the redemption date, and a premium consisting of five per centum (5/) of the principal amount of each bond so redeemed An option to call the bonds of either subseries may be exercised independently of any option to call bonds of the other subseries Section 10 Notice of Prior Redemption That notice of any prior redemption of any bonds of any subseries shall be given by the Director of Finance in the name of the City (a) By publication of such notice at least once, not less than thirty days prior to the redemption date, in a newspaper, as herein defined and (b) By sending a copy of such notice by regis- tered, first-class , postage prepaid mail, at least thirty days prior to the redemption date -26- (1) To the Purchaser of said subseries, (2) To the Fiscal Agent, and (3) To any successor of the Paying Agent, as herein defined Such notice shall specify the number or numbers of the bond or bonds to be so redeemed (if less than all are to be redeemed) and the date fixed for redemption, and shall fur- ther state that on such redemption date there will become due and payable upon each bond so to be redeemed, at the Paying Agent (designated by name) , the principal amount thereof, accrued interest to the redemption date, and the stipulated premium, and that from and after such date inter- est will cease to accrue Notice having been given in the manner hereinabove provided, the bond or bonds so called for redemption shall become due and payable on the redemption date so designated, and upon presentation thereof at the Paying Agent, together with the appurtenant coupons maturing subsequent to the redemption date, the City will pay the bond or bonds so called for redemption Section 11 Negotiability That, subject to the provisions expressly stated or necessarily implied herein, the 1965 revenue bonds hereby authorized shall be fully negotiable and shall have all the qualities of negotiable coupon paper, and the holder or holders thereof shall possess all rights enjoyed by the holders of negotiable instruments under the provisions of the Negotiable Instruments Law Section 12 Form and Execution of Bonds and Coupons A Method of Execution (a) That pursuant to Sections 139-52-12(6) and 139-52-4(7) , Bond Act, the Mayor, Director of Finance, and City Clerk shall each forthwith file with the Secretary of State his manual signature certified by him under oath (b) That thereafter each of the bonds shall be executed in the name of and on behalf of the City and authenticated with the manual signature of the Mayor, -2,7- shall be countersigned with the facsimile signature of the Director of Finance, and shall be attested with the facsimile signature of the City Clerk, with the facsim- ile of the seal of the City affixed thereto The inter- est coupons appertaining thereto shall be executed and authenticated by the facsimile signatures of said officers Said bonds and coupons bearing the signatures of the officers in office at the time of the signing thereof shall be the valid and binding obligations of the City, notwithstanding that before the delivery thereof and payment therefor any or all of the persons whose signatures appear thereon shall have ceased to fill their respective offices The Mayor by the exe- cution of the bonds and all of said officers by the exe- cution of a signature certificate shall adopt as and for their signatures the facsimiles thereof appearing upon any of the bonds or coupons In the event that at the time of executing the bonds or a signature cer- tificate the manual or tacsimile signature of a predecessor in office of any officer appears on the bonds or coupons, said officer may, in like manner, adopt as and for his own signature the manual or facsimile signature of his predecessor B Incontestable Recital in Bonds That pursuant to Section 139-52-13, Bond Act, each of the 1965 reve- nue bonds shall recite that it is issued under the authority of the Bond Act, such recital shall conclus- ively impart full compliance with all of the provi- sions thereof, and each bond issued containing such recital shall be incontestable for any cause whatsoever after its delivery for value Section 13 Special Obligations That all of the bonds, together with the interest accruing thereon, and any prior redemption premium, shall be payable and collec- tible solely out of the net income to be derived from the operation of the system, the income of which is so pledged, the holder or holders thereof may not look to any general or other fund for the payment of principal of and interest -28- on such obligations, except the designated special funds pledged therefor, and such bonds shall not constitute an indebtedness nor a debt within the meaning of any consti- tutional, charter, or statutory provision or limitation, nor shall they be considered or held to be general obliga- tions of the City Section 14 Form of Bonds and Coupons That the bonds and the coupons appertaining thereto shall be in substantially the following form -29- (Form of Bond) UNITED STATES OF AMERICA STATE OF COLORADO COUNTY OF LARIMER CITY OF FORT COLLINS SEWER REFUNDING AND IMPROVEMENT REVENUE BOND SERIES JUNE 1, 1965 SUBSERIES *R No $5 ,000 00 **$12000 00 The City of Fort Collins (herein sometimes desig- nated as the "City") , in the County of Larimer and State of Colorado, for value received, hereby promises to pay to the bearer hereof, solely from the special funds provided there- for, as hereinafter set forth on the first dayof ***December, ****June, 19_, the principal sum of FIVE THOUSAND DOLLARS **ONE THOUSAND DOLLARS and to pay from said special funds interest hereon from date until maturity at the rate of per centum ( 7) per annum, evidenced until maturity by only one set of interest coupons, payable on the first day of December, 1965 , and semiannually thereafter on the first days of June and December in each year, upon presentation and surrender of this bond and the annexed interest 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 rate of six per centum (67) per annum until the principal hereof is paid in full Both principal and interest are payable in lawful money of the United States of America, without deduction for exchange or collection charges, at the office of the Director of Finance and ex-officio City Treasurer, in Fort Collins, Colorado -30. This bond is one of a series of bonds which are subject to redemption prior to maturity Bonds of Subseries I maturing on and before the first day of December, 1974, are subject to redemption prior to their respective maturi- ties, at the option of the City, in regular numerical order, on the first day of June, 1967 , or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each bond so redeemed, accrued interest thereon to the redemption date, and a premium consisting of five per centum (57) of the principal amount of each bond so redeemed The prior redemption option hereinabove pro- vided shall not be exercised for the purpose of refunding the bonds called for prior redemption without the specific written consent to such call by the holders of those bonds, except as hereinafter provided For all purposes, including refunding, bonds of Subseries I maturing on and after the first day of December, 1975 , are subject to redemption prior to their respective maturities in inverse numerical order on the first day of December, 1974, or on any interest pay- ment date thereafter prior to maturity, for the principal amount of each bond so redeemed and accrued interest thereon to the redemption date and a premium of one per centum (17) of the principal amount of each bond so redeemed For all purposes, bonds of Subseries R maturing on or before the first day of June, 1973, are subject to redemption prior to their respective maturities in regular numerical order on the first day of December, 1965, or on any interest payment date thereafter prior to maturity, for the principal amount thereof, accrued interest to the redemption date and a premium of five per centum (57) of the principal amount of each bond so redeemed An option to call bonds of one sub- series may be exercised independently of any option to call bonds of the other subseries Redemption shall be made upon not less than thirty days' prior notice by publication and by mail in the manner and upon the conditions provided in the ordinance authorizing the issuance of this bond -31- This bond does not constitute a debt nor an indebtedness of the City within the meaning of any consti- tutional, charter, or statutory provision or limitation, shall not be considered or held to be a general obligation of the City, and is payable and collectible solely out of the net income derived from the operation of the City's municipally owned sewer system (herein sometimes designated as the "system") , the income of which is so pledged , and the holder hereof may not look to any general or other fund for the payment of the principal of and interest on this obli- gation, except the special funds pledged therefor Payment of the bonds of the series of which this is one and the interest thereon shall be made solely from, and as security for such payment there are pledged , pursuant to Ordinance No , passed and adopted on the day of , 1965, as supplemented , two special funds identified as the "City of Fort Collins , Colorado, Sewer Refunding and Improve- ment Revenue Bonds , Series June 1, 1965, Interest and Bond Retirement Fund , " and as the "City of Fort Collins, Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965, Reserve Fund , " into which funds the City covenants to pay respectively, from the revenues derived from the operation of the sewer system, as therein defined, after provision only for all necessary and reasonable expenses of the operation and maintenance of the system, sums sufficient to pay when due the principal of and the interest on the bonds of the series of which this is one and to create and main- tain a reasonable and specified reserve for such purpose For a description of said funds and the nature and extent of the security afforded thereby for the payment of the principal of and the interest on said bonds , reference is made to said ordinance The bonds of the series of which this is one are equitably and ratably secured by a lien on the net revenues of the system, as therein defined and said bonds constitute an irrevocable and first lien (but not neces- sarily an exclusively first lien) upon said net revenues Bonds in addition to the series of which this is one, subject to -32- expressed conditions , may be issued and made payable from said net revenues of the system and having a lien thereon subordinate and junior to the lien, or subject to addi- tional expressed conditions, having a lien thereon on a parity with the lien, of the bonds of the series of which this is one, in accordance with the provisions of said ordinance This bond and the other bonds of the series of which it is a part are issued under the authority of Article 52, Chapter 139, Colorado Revised Statutes 1963, which act is commonly designated as the "Water and Sewer Revenue Bond Act of Colorado" , pursuant to Section 139-52-13 thereof such recital conclusively imparts full compliance with all provisions of said act, and this bond issued con- taining such recital is incontestable for any cause what- soever after its delivery for value 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 perform all of the covenants of said ordinance, including, without limiting the generality of the foregoing, its covenants against the sale or mortgage of the system or any part thereof unless provision shall be made for the payment of the principal of and the interest on the bonds of the series of which this is one, and including its covenants that it will fix, main- tain and collect rates for services rendered by the system sufficient to produce revenues or earnings sufficient to pay the annual operation and maintenance expenses and an amount equal to one hundred thirty per centum (1307) of the combined maximum annual principal and interest requirements of the bonds and any other obligations payable annually from any revenues of the system (excluding the reserves therefor) This bond is one of a series of bonds of like tenor, amount and date, except as to number, purpose, inter- est rate, prior redemption option and maturity The bonds of said series consist of two subseries designated as Sub- series I and Subseries R, respectively The bonds comprising -33- Subseries I are issued for the purpose of the improvement and extension of the City' s municipally owned and operated sewer system by the construction and other acquisition of additional sewage collection and treatment facilities and everything necessary or incidental thereto The bonds comprising Subseries R are issued for the purpose of refund- ing, paying and discharging the City' s valid and outstand- ing revenue bonds in the principal amount of $292,000 00, payable out of and secured by a pledge of revenues to be derived from the operation of the City' s sewer system The bonds of said series are issued in conformity with the Constitution and laws of the State of Colorado, the Charter of the City, and certain ordinances and resolutions of said City duly passed and adopted prior to the issue hereof This bond is subject to the condition, and every holder hereof by accepting the same agrees with the obligor and every subsequent holder hereof, that (a) the delivery of this bond to any transferee shall vest title in this bond and in the interest coupons attached hereto in such trans- feree to the same extent for all purposes as would the delivery under like circumstances of any negotiable instru- ment payable to bearer, (b) the obligor and any agent of the obligor may treat the bearer of this bond as the absolute owner hereof for all purposes, and shall not be affected by any notice to the contrary, (c) the principal of and the interest on this bond shall be paid, and this bond and each of the coupons appertaining thereto are transferable, free from and without regard to any equities between the obligor and the original or any intermediate holder hereof, or any set-offs or cross-claims , and (d) the surrender to the obligor or any agent of the obligor of this bond and of each of the coupons shall be a good discharge to the obligor for the same It is further certified, recited and warranted that all the requirements of law have been fully complied with by the proper officers of the City in the issue of this bond -34- r IN WITNESS WHEREOF, the City of Fort Collins has caused this bond to be executed and authenticated in its name with the manual signature of the Mayor of the City of Fort Collins and countersigned by the facsimile signature of the City' s Director of Finance and ex-officio City Treas- urer, and attested with the facsimile signature of the City Clerk, has caused the facsimile of the seal of the City to be affixed hereon, and has caused the interest coupons appertaining hereto to be executed with the facsimile signa- tures of said officers, all as of the first day of June, 1965 CITY OF FORT COLLINS By (For Manual Signature) Mayor (FACSIMILE SEAL) Attest (For Facsimile Signature) City Clerk Countersigned (For Facsimile Signature) Director ot Finance *(Indicate in each bond the appropriate letter "I" or "R" indicating the subseries of which the bond is a part, and use the same letter "I" or "R" as a prefix before the bond number, e g , "I-1" or 11R-1 ") ** (Insert in bonds numbered R-1 and R-2, maturing on June 1, 1966 ) *** (Insert in all bonds of Subseries I ) ** (Insert in all bonds of Subseries R ) (End of Form of Bond) -5�= (Form of Coupon) Coupon No $ On the first day of June 19 unless the December, bond to which this coupon is attached is called for prior redemption, the City of Fort Collins, in the County of Larimer and State of Colorado, will pay to bearer in law- ful money of the United States of America at the office of the Director of Finance and ex-officio City Treasurer, in Fort Collins, Colorado, the amount herein stated solely from and secured by a pledge of special funds created from the net revenues derived from the operation of the sewer system of the City, and providing for the payment of six months' interest on its City of Fort Collins, Colorado, Sewer Refunding and Improvement Revenue Bond, Series June 1, 1965, and bearing Bond *No I- sir R- (For Facsimile Signature) Mayor (For Facsimile Signature) City Clerk (For Facsimile Signature) Director of Finance * (Insert appropriate prefix ) (End of Form of Coupon) -36- r � Section 15 Bond Preparation, Execution and Deliv- ery That the Mayor, City Clerk and Director of Finance are hereby authorized and directed to prepare and execute the bonds as herein provided When the bonds of each subseries or other block separately offered for sale have been duly executed and sold, the Director of Finance shall deliver them to the Pur- chaser of said subseries or other block on receipt of the agreed purchase price Section 16 Disposition of Bond Proceeds A Accrued Interest and Premium That all moneys received as accrued interest at the time of delivery of the bonds or any portion thereof from the sale thereof and any premium therefor shall be deposited into the Bond Fund, to apply on the payment of interest next due on the 1965 revenue bonds payable therefrom B Refunding Fund That the proceeds received from the sale of the bonds comprising Subseries R, in the amount of $2921000 00, together with the revenues derived prior to their delivery from the operation of the System, and available for use as herein provided, including but not necessarily limited to moneys accumulated in the 1948 Bond Fund, the 1948 Reserve Fund, the 1959 Bond Fand and the 1959 Reserve Fund (except for moneys sufficient to pay all necessary expenses of maintaining and operating said sewer system heretofore incurred) shall be deposited in a separate escrow account hereby created and to be known as the "City or Fort Collins , Colorado, Sewer Refund- ing and Improvement Revenue Bonds , Series June 1, 1965 , Refun& ing Fund" (herein sometimes designated as the "Refunding Fund") , with __Ej_11s-r N A T/oAa A L. "jk , in Fort Collins , Colorado (herein sometimes designated as the "Escrow Agent") , in an amount at all times at least sufficient, together with any interest or other yield to be derived from the investment and any temporary reinvestment of the deposits or any part thereof in Federal becurities as herein defined, to pay the reasonable charges of the Escrow Agent in connection herewith and to pay the principal of and the interest on the outstand- ing 1948 revenue bonds and 1959 revenue bonds hereinabove de- signated to be refunded, paid and discharged, both accrued and not accrued as the same become due, to the respective matur- ities of the designated 1948 revenue bonds and 1959 revenue -37- r � bonds Moneys shall be withdrawn by the Escrow Agent from the Refunding Fund in sufficient amounts and times to permit the payment without default of such principal and interest The Escrow Agent may also withdraw from the Refunding Fund the amounts of its reasonable service charges in connection there- with as the same accrue and become due not, however, in a total amount exceeding the amount deposited in the Refunding Fund therefor The reasonable charges, if any of any paying agent for any of the outstanding bonds being refunded shall be prompt- ly paid by the City as a cost of operating and maintaining the system Any moneys remaining in the Refunding Fund after the redemption in full of the outstanding 1948 revenue bonds and 1959 revenue bonds or after adequate provision has been made therefor, shall be applied to any lawful purpose or purposes, as the Council may direct C Insufficiency of Refunding Fund That if for any reason the amount in the Refunding Fund shall at any time be insufficient to effect the purposes of the next preceding para- graph B, the City shall forthwith, from the first available net revenues derived from the operation of the system, deposit in the Refunding rund at least such additional moneys as shall be necessary to pay the designated amounts of principal, interest and service charges of the Escrow Agent in connection with the Refunding Fund D Construction Fund That the proceeds received from the sale of the bonds comprising Subseries I, in the amount of $2 ,200,000 00, shall be deposited promptly upon the receipt thereof in a separate account hereby created and to be known as the "City of Fort Collins Colorado, Sewer Refunding and Improve- ment Revenue Bonds, Series June 1, 1965 , Construction and Other Acquisition Furd" (herein sometimes designated the "Construction Fund" or as the "1965 Construction Fund") The moneys in the Construction Fund, eAcept as herein otherwise specifically pro- vided shall be used and paid out solely for the Improvement Project Moneys shall be withdrawn from the Construction Fund for the Improvement Project only upon vouchers or checks drawn and signed by the Director of Finance and the Assistant Director of Finance The account hereby created in this paragraph D of Section 16 hereof may be maintained as an account in the City' s existing Sewer Capital Improvement Fund, but shall be separately -38- J accounted for The City may, at its option, use proceeds real- ized from the sale of the bonds comprising Subseries I, but only to the extent necessary, for the purpose of paying interest accruing on the 1965 revenue bonds on December 1, 1965 , provided, however, that any amounts so utilized shall be replaced from the first revenues of the system thereafter received not herein required to be otherwise applied E Completion of Pro]ect That when the Improvement Project shall have been completed in accordance with such plans and specifications, and when all amounts due therefor, including all proper incidental expenses, shall have been paid, the Con- sulting Engineer shall file with the Director of Finance a cer- tificate so stating, and thereupon the City Manager shall trans- fer to the 1965 Reserve Fund all money remaining in such Con- struction Fund, if any F Purchaser Not Responsible That any purchaser of the bonds herein authorized, however, shall in no manner be responsible for the application or disposal by the City or by its officers of the funds derived from the sale thereof or of any other funds herein designated Section 17 Fiscal Year That for the purpose of this ordinance, the system shall be operated upon a fiscal year basis commencing on the first day of January in each calendar year and ending on the last day of December in the same year Section 18 Sewer Fund That for the purposes of this ordinance, a separate account shall be set aside, main- tained and known as the "City of Fort Collins, Colorado, Sewer System Gross Income Fund" (herein sometimes designated as the "Sewer Fund" or as the "Income Fund") So long as any of the bonds hereby authorized shall be outstanding , either as to prin- cipal or interest, all income and revenues derived from the operation of the system except as hereinbefore provided, shall be deposited into the Sewer Fund Section 19 Administration of Sewer Fund That so long as any of the bonds hereby authorized shall be outstanding, either as to principal or interest, or both, the following pay- ments shall be made from the Sewer Fund A 0 & M Expenses Firstly, as a first charge thereon, there shall be set aside from time to time moneys sufficient to pay operation and maintenance expenses of the -39- system as they become due and payable, and thereupon they shall be promptly paid Any surplus remaining at the end of the Fiscal Year and not needed for operation and main- tenance expenses shall be transferred to the Sewer Fund and be used for the purposes thereof , as herein provided B 1965 Bond Fund Payments Secondly, from any moneys remaining in the Sewer Fund, i e , from the net in- come of the sewer system, there shall be deposited into a separate account hereby created and to be known as the "City of Fort Collins, Colorado, Sewer Refunding and Improvement Revenue Bonds, Series June 1 1965 , Interest and Bond Re- tirement Fund" (herein sometimes referred to as the "1965 Bond Fund" or as the "Bond Fund") , the following (1) Monthly, commencing on the 1st_ day of une_, 1965 an amount in equal monthly install- ments necessary, together with any moneys therein and available therefor, to pay the next maturing install- ment of interest on the 1965 revenue bonds then out- standing and monthly thereafter commencing on said interest payment date one-sixth of the amount neces- sary to pay the next maturing installment of interest on the outstanding 1965 revenue bonds (2) Monthly, commencing on the 1st day of June —, 1965 , an amount in equal monthly install- ments necessary, together with any moneys therein and available therefor to pay the next maturing install- ment of principal of the outstanding 1965 revenue bonds , and monthly thereafter commencing on said prin- cipal payment date one-twelfth of the amount necessary to pay the next maturing installment of principal on the 1965 revenue bonds C 1965 Reserve Fund Payments Thirdly, but concur- rently with the payments required by the next preceding para- graph B of this Section 19 hereof, except as provided in paragraphs D and E of this Section 19 from any moneys re- maining in the Sewer Fund, there shall be set aside and paid monthly, commencing on the first day of the month following the first or only date on which any of the 1965 revenue bonds are delivered, at least $1,675 00 per month into a separate account hereby created and to be known as the "City of Fort -40- Collins, Colorado, Sewer Refunding and Improvement Bonds , Series June 1, 1965 , Reserve Fund" (herein sometimes re- ferred to as the "1965 Reserve Fund" or as the "Reserve Fund") , until a reserve has been accumulated in an amount equal to not less than $180,000 00 (herein sometimes desig- nated as the "Minimum Reserve") After the Minimum Reserve has been accumulated such amounts or amount, if any, shall be deposited monthly from any moneys remaining in the Sewer Fund, into the Reserve Fund necessary to maintain the Re- serve Fund as a continuing reserve in an amount not less than the Minimum Reserve to meet possible deficiencies in the Bond Fund No payment need be made into the Reserve Fund so long as the moneys therein shall equal not less than the Minimum Reserve The moneys in the Reserve Fund shall be accumulated and maintained as a continuing reserve to be used, except as hereinafter provided in said paragraphs D and E of this Section 19, only to prevent deficiencies in the payment of the principal of and the interest on the bonds hereby authorized resulting from the failure to depos- it into the Bond Fund sufficient funds to pay said princi- pal and interest as the same accrue D Termination upon Deposits to Maturity No payment need be made into the Bond Fund, the Reserve Fund, or both, if the amount in the Bond Fund and the amount in the Reserve Fund total a sum at least equal to the entire amount of the 1965 revenue bonds outstanding, both as to principal and interest to their respective maturities, and both accrued and not accrued, in which case moneys in said two funds in an amount at least equal to such principal and interest requirements shall be used solely to pay such as the same accrue, and any moneys in excess thereof in said two funds and any other moneys derived from the operation of the sys- tem may be used in any lawful manner determined by the City Council E Defraying Delinquencies in Bond Fund and Reserve Fund If, in any month, the City shall, for any reason, fail to pay into the Bond Fund the full amount above stipulated from the net income of the sewer system -41- t then an amount shall be paid into the Bond Fund in such month from the Reserve Fund equal to the difference between that paid from said net income and the full amount so stipulated The money so used shall be replaced in the Reserve Fund from the first revenues thereafter received from the operation of the system not required to be otherwise applied by paragraphs A, B, C and F of this Section 19, but excluding any pay- ments required for any subordinate obligations In the case other bonds or other obligations are outstand- ing any lien to secure the payment of which on the net revenues of the system is on a parity with the lien thereon of the 1965 revenue bonds , and the proceedings authorizing the issuance of those obligations require the replacement of moneys in a reserve fund therefor, then the money replaced in the 1965 Reserve Fund and each such other reserve fund shall be replaced on a pro rata basis as moneys become available therefor If, in any month, the City shall, for any reason, fail to pay into the Reserve Fund the full amount above stipulated from the net income of said sewer system, the difference between the amount paid and the amount so stipulated shall in a like manner be paid therein from the first revenues thereafter received from the operation of the system not required to be otherwise applied by paragraphs A. B, C and F of this Section 19, but excluding any payments required for any subor- dinate obligations The moneys in the Bond Fund and the Reserve Fund shall be used solely and only for the purpose of paying the principal of and the interest on the bonds issued hereunder provided, however, that any moneys at any time in excess of the Minimum Reserve in the Reserve Fund may be withdrawn therefrom and used as herein provided for the redemption of bonds hereby authorized as they become due or on any redemption date, and provided that any moneys in the Bond Fund and the Reserve Fund in excess of accrued and unaccrued -42- principal and interest requirements to the respective maturities of the bonds outstanding may be used as hereinabove provided in paragraph D of this Section 19 F Payment for Additional Obligations Fourthly, but either subsequently to or concurrently with the payments required by paragraphs B and C of this Section 19 hereof and as provided in Sections 23 to 31, both inclusive, hereof, any balance remaining in the Sewer Fund, after making the payments hereinabove provided, shall be used by the City for the payment of interest on and the principal of additional bonds or other obli- gations hereafter authorized to be issued and payable from the revenues of the sewer system, including reas- onable reserves therefor, as the same accrue, provided that the lien of such additional bonds or other obliga- tions on the net income and revenues of the system and the pledge thereof for the payment of such additional obligations shall be on a parity with, or subordinate to, the lien and pledge of the bonds herein authorized, as hereinafter provided G Use of Sewer Revenues After making the payments hereinabove required to be made by paragraphs A to F, both inclusive, of this Section 19 hereof, any remaining income and revenues derived from the opera- tion of the sewer system in the Sewer Fund, shall be used for any one or any combination of purposes, as follows (1) For the payment of the interest on and principal of general obligation bonds , debt and other obligations, if any, incurred in the acquire- ment, construction and improvement of the sewer system (2) For the purchase in the open market of the 1965 revenue bonds or any other outstanding bonds or other obligations incurred for any such purpose or purposes and payable from any revenues of the sewer system, at the best price obtainable, -43- not, however, in excess of the call price therefor then applicable, or if none be then applicable, not in excess of a reasonable price therefor, (3) For the prior redemption of the 1965 revenue bonds or any other outstanding bonds or other obligations incurred for any such purpose or purposes and payable from the revenues of the sewer system, in accordance with the provisions of the bonds or other obligations and the ordinance authorizing their issuance, including but not necessarily limited to this ordinance, but not in excess of a price at which such bonds or other obligations can be purchased in the open market, (4) For the improvement and extension of the sewer system, (5) For any other lawful purpose or purposes authorized by the Constitution and laws of the State of Colorado and the resolutions, ordinances and Charter of the City, as the same may be amended from time to time, as the City Council at its option may from time to time determine and direct Section 20 General Administration of Funds That the funds and accounts designated in Sections 16, 18 and 19 hereof shall be administered as follows A Places and Times of Deposits Each of the funds and accounts hereinabove designated in Sections 16, 18 and 19 hereof shall be maintained and accounted for separately from all other funds and accounts and shall be deposited in an Insured Bank or Insured Banks as determined and designated by the City Council (except as otherwise expressly stated herein) but each fund and account need not necessarily constitute a separate bank account Each bank account shall be continuously secured to the fullest extent required or permitted by the laws of Colorado for the securing of public funds, and shall be irrevocable and not withdrawable by anyone -44- for any purpose other than the respective designated purposes Each monthly payment shall be made into the proper account on the first day of each month, except that when the first day of any month shall be a Sunday or a legal holiday, then such payment shall be made on the next preceding secular day Notwith- standing any other provision herein to the contrary, moneys shall be credited with the Paying Agent at least five days prior to each interest payment date herein designated sufficient to pay the interest and any principal then becoming due on the bonds B Investment of Moneys Any moneys in any account designated in Sections 16, 18 and 19 hereof, not needed for immediate use, may be invested or reinvested by the Director of Finance in Federal Securities which shall be subject to redemption at face value by the holder thereof at the option of such holder, or which shall mature not later than ten years from the date of such investment, provided, however, that the maturity of any security which is not subject to prior redemption at the holder' s option shall not exceed the estimated date of the probable expenditure or use of the moneys evidenced by such security, except that Federal Securities in the Refunding Fund shall so be subject to redemption at the holder' s option at face value or shall mature at least five days prior to the respective interest and principal payment dates of the outstanding bonds being refunded so that moneys from the redemption of the Federal Securities shall be available in sufficient amounts and at such times to permit the redemption of the designated outstanding bonds at their designated maturities as herein provided The Federal Securities so purchased as an investment of moneys in any such account shall be deemed at all times to be a part of said account, and the interest accruing thereon and any profit realized therefrom shall be credited to -45- the account to which the investment appertains , and any loss resulting from such investment shall be charged to such account Moneys in any account designated in Sec- tions 16, 18 and 19 hereof not immediately needed as hereinabove provided in this paragraph B of this Sec- tion 20, may also be invested or reinvested in a savings account in a state or federal savings and loan asso- ciation in Colorado which is a member of the Federal Savings and Loan Insurance Corporation, so long as the payment of such account is fully secured under the appropriate federal law The Director of Finance shall present for redemption or sale on the prevailing market any Federal Securities so purchased as an investment of moneys in the fund or account whenever it shall be necessary to do so in order to provide moneys to meet any payment or transfer from such account C Character of Funds The moneys in any account herein authorized shall consist either of lawful money of the United States of America, or Federal Securities , or both such money and such securities Moneys depos- ited in a demand or time deposit account in, or evi- denced by a certificate of deposit of , an Insured Bank, or deposited in a savings account pursuant to the next preceding paragraph B hereof, shall be deemed lawful money of the United States of America Section 21 First Lien Bonds That the 1965 reve- nue bonds, subject to the payment of all necessary and reas- onable operation and maintenance expenses of the system, constitute an irrevocable and first (but not necessarily an exclusively first) lien upon the revenues derived from the operation of such system Section 22 Equality of Bonds That the 1965 revenue bonds authorized to be issued hereunder and from time to time outstanding shall not be entitled to any priority one over the other in the application of the reve- nues of the sewer system, regardless of the time or times of the issuance of the bonds, it being the intention of the -46- Council that there shall be no priority among the bonds regardless of the fact that they may be actually issued and delivered at different times Section 23 Limitations upon Issuance of Parity Bonds Nothing in this ordinance contained shall be con- strued in such a manner as to prevent the issuance by the City of additional bonds or other obligations payable from the income or any revenues derived from the operation of the system, as authorized by law, and constituting a lien upon said revenues on a parity with, but not prior nor superior to, the lien of the 1965 revenue bonds herein authorized nor to prevent the issuance of bonds or other obligations refunding all or a part of the 1965 revenue bonds herein authorized, provided, however, that before any such additional parity bonds or other parity obligations are authorized or actually issued, excluding any parity refunding bonds or parity refunding obligations (other than those refunding subordinate bonds, as permitted in Section 30 hereof) A Absence of Default_ The City shall not have defaulted in making any payments required by Section 19 hereof during the twelve months immediately preceding the issuance of such additional bonds or other addi- tional obligations, or if none of the 1965 revenue bonds have been issued and outstanding for a period of at least twelve months , for the longest period any of the 1965 revenue bonds have been issued and out- standing , and B Historic Earnings Test The annual revenues derived from the operation of the sewer system for the Fiscal Year immediately preceding the date of the issuance of such additional parity bonds or obligations shall have been sufficient to pay the annual operation and maintenance expenses of the sewer system for said Fiscal Year, and, in addition sufficient to pay an amount representing one hundred thirty per centum (1307) of the combined maximum annual principal and interest -47- requirements of the outstanding revenue bonds and other obligations of the City payable from and constituting a lien upon revenues of the sewer system (excluding any reserves therefor) , and C Projected Earnings Test The estimated annual revenues to be derived from the operation of the sewer system for the twelve months immediately succeeding the completion of the facilities to be acquired with the proceeds of the additional bonds or obligations reduced by an amount equal to 257 of estimated revenues to be derived from the proposed facilities to be acquired with the proceeds of the additional bonds or obliga- tions shall be an amount equal to the sum of the follow- ing (1) the estimated operation and maintenance expenses of the sewer system for said twelve months , (2) an amount representing one hundred thirty per centum (130/) of the combined maximum annual principal and interest requirements of the outstanding revenue bonds and other obligations of the City payable from and con- stituting a lien upon revenues of the sewer system, and the bonds or other obligations proposed to be issued (excluding any reserves therefor) Section 24 Certification of Revenues That a written certification by a Consulting Engineer (except the City Engineer) that the said estimated revenues and that said annual revenues, when ad3usted as herein provided, are sufficient to pay said amounts, shall be conclusively pre- sumed to be accurate in determining the right of the City to authorize, issue, sell and deliver said additional bonds or other additional obligations on a parity with the bonds herein authorized, provided, however, that the written cer- tification shall be submitted to the Fiscal Agent for review at least 30 days prior to the authorization of any addi- tional bonds as permitted by this Section Section 25 Estimation of Annual Revenues That the Consulting Engineer in rendering his certification shall give consideration to any probable increase (but not reduction) -48- in operation and maintenance expenses of the sewer system, that will result from the expenditure of the funds proposed to be derived from the issuance and sale of the said bonds or other obligations Section 26 Subordinate Bonds Permitted That nothing herein contained, subject to limitations herein stated, shall be construed so as to prevent the City from issuing additional bonds payable from the revenues of the system and having a lien thereon subordinate inferior, and junior to the lien of the bonds authorized to be issued by this ordinance Section 27 Superior Bonds Prohibited That nothing herein contained shall be construed so as to permit the City to issue additional bonds or other obligations payable from the net revenues and having a lien thereon prior and superior to she bonds herein authorized to be issued Section 28 Use of Proceeds That the proceeds of any additional bonds (other than refunding bonds) payable from net revenues shall be used only for the purpose of improving and extending the sewer system Section 29 Privilege of Issuing Refunding Bonds That if at any time after the 1965 revenue bonds herein authorized, or any part thereof shall have been issued and remain outstanding, them Council shall find it desirable to refund any outstanding bonds or other obligations payable from and constituting a lien upon any revenues of the sewer system, said bonds or other obligations , or any part thereof, may be refunded (but only with the consent of the holder or holders thereof, unless the bonds at the time or times of their required surrender for payment shall then mature or shall then be callable for prior redemption at the City' s option upon proper call) , regardless of whether the priority of the lien for the payment of the refunding bonds on the revenues of the sewer s} stem is changed (except as provided in Sections 27 and 30 hereof) -49- Section 30 Limitations upon Issuance of Parity Refunding Bonds That no refunding bonds or other refunding obligations payable from net revenues shall be issued on a parity with the bonds herein authorized, unless A The lien of the outstanding bonds so refunded on net revenues of the system is on a parity with the lien thereon of the bonds herein authorized, or B The refunding bonds are issued in compliance with subsections A and B of Section 23 hereof Section 31 Limitations upon Issuance of Any Refunding Bonds That any refunding bonds or other refund- ing obligations payable from any revenues of the system shall be issued with such details as the Council may by ordinance provide, but without any impairment of any con- tractual obligations imposed by the City by any proceedings authorizing the issuance of any unrefunded portion of such outstanding bonds or obligations of any one or more issues (including but not necessarily 11-nited to the 1965 revenue bonds herein authorized) If only a part of the outstanding bonds of any issue or issues payable from the net revenues of the system is refunded, then such bonds may not be refunded without the consent of the holder or holders of the unrefunded portion of such bonds unless A The net annual interest cost each year to the City on such refunding bonds shall be less than the net annual interest cost for the same years on the outstanding bonds refunded thereby, or B The lien on revenues of the sewer system for the payment of the refunding obligations is subordinate to each such lien for the payment of any obligations not refunded The refunding bonds or other refunding obligations so issued shall enjoy complete equality of lien with the portion of any bonds or other obligations of the same issue which is not refunded if any there be and the holder or holders of such refunding bonds or such other refunding obligations shall be subrogated to all of the rights and privileges -50- enjoyed by the holder or holders of the bonds or other obligations of the same issue refunded thereby Section 32 Protective Covenants That the City hereby covenants and agrees with each and every holder from time to time of the bonds issued hereunder A Use of Bond Proceeds (1) That the City, with the proceeds derived from the sale of the refunding bonds in the amount of $292,000 00 , will proceed without delay to effect the Refunding Project, investing the moneys available for the refunding, payment and discharge of the two hundred and ninety-two outstanding bonds to be refunded to the best advantage of the City pending the need from time to time of such moneys for such refunding, payment and discharge (2) That the City, with the proceeds derived from the sale of the improvement bonds in the amount of $2,200 000 00, will, after the sale, issuance and delivery of such bonds proceed without delay to effect the Improvement Project as hereinabove provided B Payment of 1965 Bonds That the City will promptly pay the principal of and the interest on every 1965 revenue bond issued hereunder and secured hereby at the place, on the dates and in the manner specified herein and in said bonds and in the coupons thereto appertaining accord- ing to the true intent and meaning hereof Such principal and interest are payable solely from the net income to be derived from the operation of, and the resultant rates and charges for the use of, and the products and services ren- dered by, the sewer system, and nothing in the bonds or coupons or in this ordinance shall be construed as obli- gating the City to redeem any of said bonds principal or interest, from, and the holder or holders thereof may not look to, any general or other fund except the income which is so pledged under the provisions of this ordinance -51- C Service Charges and Their Collection That while the bonds authorized herein or any of them remain out- standing and unpaid, the rates for all services rendered by the sewer system to the City and to its inhabitants and to all consumers within or without the boundaries of the City shall be reasonable and just, taking into account and consideration the cost and value of said sewer system and the proper and necessary allowances for the depreciation thereof and the amounts necessary for the retirement of all bonds and other securities or obligations payable from the revenues of the sewer system the accruing interest thereon, and reserves therefor , and there shall be charged against all purchasers of service, including the City, such rates and amounts as shall be adequate to meet the requirements of this and the preceding sections hereof, and which rates and amounts from the sewer system shall be sufficient to produce revenues or earnings annually to pay the annual operation and maintenance expenses and an amount equal to one hundred thirty per centum (130/) of the combined maximum annual principal and interest requirements on bonds and any other obligations payable annually from any revenues thereof (excluding the reserves therefor) , all of which revenues, including those received from the City, shall be subject to distribution to the payment of operation and maintenance expenses of the sewer system and the payment of principal of and interest on all obligations payable from the revenues of the sewer system, including reasonable reserves therefor , that no free service nor facilities shall be fur- nished by the sewer system, that should the City elect to use for municipal purposes any sewage disposal facilities, or in any other manner use the system, or any part thereof, any such use will be paid for from the City' s general fund or other available revenues at the reasonable value of the use so made that all the income so derived from the City shall be deemed to be income derived from the operation of the sewer system, to be used and accounted for in the same manner as any other income derived from the operation of said sewer system The City shall cause all rates , fees and service -52- charges appertaining to said system to be collected as soon as reasonable, shall prescribe and enforce rules and regula- tions for the payment thereof and for the connection with and the disconnection from properties of said sewer system, and shall provide methods of collection and penalties to the end that net revenues of the sewer system shall be adequate to meet the requirements thereof D Levy of Chars That the City will by an ordinance finally adopted and approved not later thin the 15th day of April , 1965 , in which rates and charges , as provided in said ordinance, shall be effective not later than the 19t day of October. , 1965 , fix, establisn and levy the rates and charges which are required by paragraph C of this Section 32 of this ordinance, if such action be necessary therefor No reduction in any initial or existing rate schedule for the sewer system may oe made unless (1) The City has fully complied with the provisions of Section 19 of this ordinance for at least the full Fiscal Year immediately preceding such reduction of the initial rate schedule , or if none of the 1965 revenue bonds have been issued and outstanding for a period of at least one year , for the longest period that any of the 1965 revenue bonds have been issued and outstanding (2) The audit required by the Independent Account- ant and by paragraph H of this Section 32 of this ordi- nance for the full Fiscal Year imrediately preceding such reduction, or if none of the 1965 revenue bonds have been issued and outstanding for a period of at least one year, for the longest period that any of the 1965 revenue bonds have been issued and outstanding discloses that the esti- mated revenues resulting from the proposed reduction, for the sewer system will be sufficient to pay an amount at least equal to the operation and maintenance expenses of the sewer system for said period and, in addition one hundred and thirty per centum (130'1 ) of the combined max- imum annual principal and interest requirements on bonds and any other obligations payable annually from any revenues of the sewer system (excluding reserves therefor) -53- F Billing Procedure That all bills for sewerage dispoaal services or facilities furnished or served by or through the system shall be rendered to cus- tomers at regular intervals and shall be delinquent -thirty days after their date , and in the event said bills are not paid within thirt3 days after they become delinquent, ser- vice shall be discortinued and the rates and charges due shall be collected in a lawful manner F Rc_cords That so long as any of the bonds remain outstanding, lioper book., of record and account will be kept by the City, separate and apart from all other records and accounts , showing complete and correct entries of all transactions relating to the system Such books shall include (but not necessarily be limited to) monthly records showing a detailed statement of the expenses of the system G Right to_Inspect that any holder of any of the bonds or any duly authorized agent or agents of such holder shall have the right at all reasonable times to inspect all records, accounts and data relating thereto and to inspect the systEri and all propei.ties comprising the system H Audits That the City shall, within ninety days following tie close of each Fiscal Year, cause an audit of such books and accounts to be made by an Independent Accountant showing the receipts and disbursements for the account of the system, and that such audit will be available for inspect on by any holder of any of the bonds Each such audit, in addition to whaLever matters may be thought proper b} the accountant to be included thei.ein, shall include the f o llo,aing (1) A statement in detail of the income and expr.nd t,res of the sewer system for the Fiscal Year, including out not necessarily limited to a classified statement of gross revenues received from the operation of the sewer system of the net revenues, and of the amount of any capital expenditures appertaining to the sewer system for the Fiscal Year, and a statement of the profit or loss for the Fiscal Year, -54- (2) A balance sheet as of the end of such Fiscal Year, including the amount on hand, both cash and investments , in each of the funds created by the various ordinances and other proceedings authorizing the issu- ance of outstanding bonds and other obligations payable from the revenues of the sewer system, (3) The accountant' s comment regarding the City' s methods of operation and accounting practice and the manner in which the City has carried out the require- ments of this ordinance, and any other ordinance and other proceedings authorizing the issuance of outstand- ing bonds or other obligations payable from the revenues of the system, and the accountant' s recommendation for any change or improvement in the operation of the system as the accountant deems appropriate , and (4) A recapitulation of each fund or account created by the various ordinances and other proceedings authorizing the issuance of outstanding bonds and other obligations payable from the revenues of the system, into which fund are put moneys derived from the opera- tion of the system or derived from the sale of Federal Securities, such analysis to show the balance in such fund at the beginning of the Fiscal Year, the deposits and withdrawals during said year, and the balance at the end of said year All expenses incurred in the making of the audits and reports required by this paragraph shall be regarded and paid as a maintenance and operation expense The City agrees to fur- nish forthwith (and in any event within sixty days from the time the audit and report is filed with the City) a copy of each of such audits and reports to the holder of any of the bonds at his request, and without request a To any Purchaser, b To the Fiscal Agent, and c To any other person designated in any ordi- nance or other proceedings appertaining to any outstanding obligations payable from revenues of the system other than the 1965 revenue bonds, -55- after each audit and re ort has been prepared, and that any such holder shall have the right to discuss with the account- ant or person making the audit and report the contents thereof and to ask fo- such additional information as he may reason- ably icquirc I Efficient O, eratzon That the City will oper- ate the system so long a,, any of tha 19b5 revenue bonds are outstanding in an efficient and economical manner will main- tain tre system in efficient operating cond-Ltion, and will ma6e sucn m,rovcment� , enlergerrents, extensions, repairs and bettP7ments thereto as ma} be necessary or advisable to insure their econom Pal and efficient operation at all times J Use of Bond Fund and Raserve fund That the Boiid Fund and the Reseric Fund shall be used solely and only, and those funds are -teYeb,* pledged foe the purpose of paying t'ie i terest or and the priucipal of the bonds herein author- ized c -wept for. those moneys ut the Bond Fund and the Re erve Fund as are in LY( ebs of the interest on and the prin. ipal of the bonds ba h accrued and not accrued, to the r fegpectiva maturiLies tnd eAcepfi those moneys of the Re-er e Fund in e%cess of the Minimum Reserve, as herein- abovf provided K Charges ane Liens upon System That from the revenues of the sewer system, Lhe City will pay all taxes and asbessment. or other municipal or governmental charges , if any, lawfully levied a ses ed upon or in respect to the system of i-zy part thereo{ when the Qame shall become due, and it will duly oboerve and comply with all valid require- ments of any municipal or gcvernmental authority relatLve to arty part of tEie sybtcm and the City will not create nor ouffor c oc (--if :tted any lticn or charge upon the system nor upon the revenues thei irom except ab permitted by this ordinance or it will ma e -idequate provisions to satisfy and di cnarge wither ^2) ty days after tre same shall accrue, all lawful claims and aemands for labor, materials, supplies 01 ot'ier o'ilects wh.ch if urij did m.Lght by la,a becoma a Lien L.r,on the y.,tem at .upon the rcvc hues th�T efrom 56- provided, however that nothing herein shall require the City to pay or cause to be discharged, or make provision for any such tax, assessments lien or charge before the time when payment thereof shall be due or so long as the validity thereof shall be contested in good faith by approp- riate legal proceedings L Insurance That the City in its operation of the sewer system will carry fire and extended coverage insur- ance, workmen' s compensation insurance, public liability insurance, and other types of insurance in such amounts and to such extent as is normally carried by private corporations operating public utilities of the same type The cost of such insurance shall be considered one of the operating costs of the system In the event of property loss or damage, insurance proceeds shall be used first for the purpose of restoring or replacing the property lost or damaged, and any remainder shall be treated as net income and shall be sub- ject to distribution in the manner provided hereinabove in Section 19 hereof, for net income and revenues derived from the operation of the system M Competing System That as long as any of the 1965 revenue bonds are outstanding, the City shall not grant any franchise or license to a competing sewer system, nor shall it permit during said period (except as it may legally be required to do so) any person, association, firm, corpora- tion or organization to sell sewer service or facilities, to any c3nsumer public or private, within the City Such limitation shall not apply to any person, association, firm corporation or organization presently selling sewer service or facilities within the City or which, by annexation to or consolidation with the City, hereafter sells sewer service or facilities within the City provided however, that such person association, firm, corporation or organization shall not be permitted to expand its services so as to diminish the security for the bonds N Alienation of bystem Prohibited That the City will not sell, lease mortgage, pledge or otherwise -57- encumber, or in any manner dispose of or otherwise alienate , the sewer system or any part thereof, including any and all extensions and additions that may be made thereto, until all the bonds herein authorized to be issued shall have been paid in full both principal and interest, or unless provi- sion has been made therefor, except that the City may sell any portion of said property which shall have been replaced by other property of at least equal value or which shall cease to be necessary for the efficient operation of the system but in no manner nor to such extent as might pre- judice the security for the payment of the bonds herein authorized, provided, however that in the event of any sale as aforesaid, the proceeds of such sale shall be dis- tributed as net income of the system, in accordance with the provisions of Section 19 hereof 0 Extension of Interest Payments That in order Lo pre-vent any accumulation of coupons or claims for interest after maturity, the City will not directly or in- directly extend or assent to the extension of the time for the payment of any coupon or claim for interest on any of the bonds issued hereunder , and it will not directly or indirectly be a party to or approve any arrangement for any such extension or for the purpose of keeping alive any of said coupons , and in case the time for payment of any such coupons shall be extended, such coupon or installment or installments of interest after such extension or arrange- ment shall not be entitled in case of default hereunder to the benefit or security of this ordinance, except subject to the prior payment in full of the principal of all bonds issued hereunder and then outstanding , and of matured interest on such bonds the payment of which has not been extended P Surety Bonds Ihat each municipal official or other person having custody of any funds derived from opera- tion of the system, or responsible for the handling of such funds, shall be fully bonded at all times which bond shall be conditioned upon the proper application of said funds -58- The cost of each such bond shall be considered one of the operating costs of the system to which the bond appertains Q Additional Bonds The City will not hereafter issue any bonds or other obligations payable from the reve- nues of the system and having a lien on a parity with or bubordinate to the bonds herein authorized until all bonds herein authorized have been paid in full, unless such addi- tional bonds or other additional obligations on a parity with or junior to the bonds herein authorized are issued in such manner as provided in Sections 23 to 31 both inclusive hereof k Competent Management That the City shall employ experienced and competent management personnel for the system In the event of default on the part of the City in paying principal of or interest on the bonds promptly as each falls due, or in the keeping of any covenants herein contained and if such default shall continue for a period of sixty days , or if the net revenues of the system in any Fiscal Year should fail to equal at least the amount of the principal of and the interest on the revenue bonds and other obligations (including all reserves therefor specified in the authorizing proceedings, including but not limited to this ordinance) payable from said net revenues in that Fiscal Year, the City shall retain a firm of competent management engineers skilled in the operation of sewer systems to assist the management of the system so long as such default continues or the net revenues are less than the amount hereinabove designated S Performing Duties That the City will faith- fully and punctually perform all duties with respect to the system required by the Constitution and laws of the State of Colorado and the ordinances and resolutions of the City including but not limited to the making and collecting of reasonable and sufficient rates and charges for service rendered or furnished by the system as hereinbefore pro- vided, and the proper segregation of the revenues of the system and their application to the respective accounts -59- T Other Liens That other than as provided by this ordinance, there are no liens or encumbrances of any nature, whatsoever on or against the system or the revenues derived or to be derived from the operation of the same U City' s Existence That the City will maintain its corporate identity and existence so long as the 1965 revenue bonds herein authorized remain outstanding, unless another political subdivision by operation of law succeeds to the duties, privileges powers, liabilities , disabilities, immunities, and rights of the City and is obligated by law to operate and maintain the sewer system as herein provided for the City without adversely affecting to any substantial degree the privilege and rights of any holder of any out- standing bond V Payment of Refunded Bonds That the City shall pay the principal of and interest on the outstanding 1948 revenue bonds and the 1959 revenue bonds as the same shall become payable at their respective maturities Section 33 / Disposition of Funds Concerning Outstanding Bonds That simultaneously with the delivery of Subseries R of the 1965 revenue bonds, the Director of Finance sha11 make the following disposition of the 1948 Bond Fund the 1948 Reserve Fund the 1959 Bond Fund and the 1959 Reserve Fund A Firstly, there shall be paid into the Refunding Fund an amount fully sufficient to pay interest on when due and redeem the principal of the outstanding bonab to be refunded at their respec- tive maturities and any service charges appertaining thereto to be paid from the Refunding Fund including but not necessarily limited to any charges for the Escrow Agent to be paid for the operation and main- tenance of the Refunding Fund and performing services incidental thereto, parsuant to an agreement to be hereafter executed between the City and the Escrow Agent (sometimes designated as the "Escrow Agreement") a- authorized by paragraph C of Section 38 hereof, -60- except to the extent $292,000 00 of the proceeds of the refunding bonds are deposited in the Refunding Fund, and B Secondly, the Director of Finance shall make provision for the payment of any service charges or other expenses incidental to refunding the outstanding bonds to be refunded and not to be paid from the Refunding Fund, and C Thirdly, the Director of Finance shall make provision for the payment of the principal of and interest on the 1965 revenue bonds becoming due on or before the first day of June, 1966, except to the extent provision is otherwise made for such payments , and D Fourthly, and finally any moneys remaining in the 1948 Bond Fund, the 1948 Reserve Fund, the 1959 Bond Fund and the 1959 Reserve Fund may be applied to any other lawful purpose or purposes authorized by the Constitution and laws of the State of Colorado, and the ordinances of the City of Fort Collins, as the same may be from time to time amended Section 34 Exemption from Taxation That pur- suant to Section 139-52-6, Bond Act, the bonds herein author- ized and the income therefrom shall be exempt from taxation, except inheritance, estate and transfer taxes Section 35 Events of Default That each of the f olloding events is hereby declared an "event of default," that is to say A Nonpayment of Principal Payment of the principal of any of the bonds herein authorized to be issued shall not be made when the same shall become due and payable either at maturity or by proceedings for prior redemption, or otherwise B Nonpayment of Interest Payment of any installment of interest shall not be made when the same becomes due and payable or within thirty days thereafter -61- C Incapable to Perform The City shall for any reason be rendered incapable of fulfilling its obliga- tions hereunder D Default of any Provision The City shall make default in the due and punctual performance of its covenants or conditions, agreements and provisions contained in the bonds or in the ordinance on its part to be performed, and if such default shall continue for sixty days after written notice specifying such default and requiring the same to be remedied shall have been given to the City by the holders of twenty-five per centum (25/) in principal amount of the bonds then outstanding Section 36 Remedies for Defaults That upon the happening and continuance of any of the events of default as provided in Section 35 hereof, then and in every case the holder or holders of not less than twenty-five per centum (25/) in principal amount of the bonds then outstanding, including but not limited to a trustee or trustees therefor, may proceed against the City, its governing body, and its agents, officers and employees to protect and enforce the rights of any holder of bonds or coupons under this ordi- nance by mandamus or other suit , action or special proceed- ings in equity or at law, in any court of competent juris- diction, either for the appointment of a receiver or for the specific performance of any covenant or agreement con- tained herein or in an award of execution of any power herein granted for the enforcement of any power, legal or equitable remedy as such holder or holders may deem most effectual to protect and enforce the rights aforesaid, or thereby to enjoin any act or thing which may be unlawful or in violation of any right of any bondholder, or to require the governing body of the City to act as if it were the trustee of an expressed trust, or any combination of such remedies All such proceedings at law or in equity shall be instituted, had and maintained for the equal benefit of all holders of the bonds and coupons then outstanding Any -62- receiver appointed in any proceedings to protect the rights of such holders hereunder, the consent to any such appoint- ment being hereby expressly granted, may enter and take possession of the system operate and maintain the same, prescribe rates, fees or charges, and collect, receive and apply all revenues arising after the appointment of such receiver in the same manner as the City itself might do The failure of any such holder so to proceed shall not relieve the City or any of its officers, agents or employees of any liability for failure to perform any duty Each right or privilege of any such holder (or trustee thereof) is in addition and cumulative to any other right or privi- lege, and the exercise of any right or privilege by or on behalf of any holder shall not be deemed a waiver of any other right or privilege thereof Section 37 Duties Upon Defaults That upon the happening of any of the events of default as provided in Section 35 hereof, the City, in addition, will do and per- form all proper acts on behalf of and for the holders of bonds and coupons to protect and preserve the security created for the payment of their bonds and coupons and to insure the payment of the principal of and the interest on said bonds promptly as the same become due All proceeds derived therefrom, so long as any of the bonds herein authorized, either as to principal or interest, are out- standing and unpaid, shall be paid into the Bond Fund, and in the event of obligations hereunder issued and outstand- ing during said period of time on a parity with the bonds herein authorized, into such bond funds for all "parity" obligations on an equitable and prorated basis, and used for the purposes therein provided In the event the City fails or refuses to proceed as in this section provided, the holder or holders of not less than twenty-five per centum (257) in principal amount of the bonds then outstanding, after demand in writing, may proceed to protect and enforce the rights of the bondholders as hereinabove provided -63- Section 38 Delegated Powers That the officers of the City be, and they hereby are, authorized and directed to take all action necessary or appropriate to effectuate the provisions hereof including, without limiting the generality of the foregoing A Printing Bonds The printing of the bonds, including on each a certified true copy of bond counsel' s approving opinion, B Final Certificates The execution of such certificates as may be reasonably required by any Pur- chaser relating, inter alia, to the signing of the bonds, the tenure and identity of the municipal offi- cials, delivery of the bonds, the receipt of the bond purchase price, the creation of an escrow for the Refunding Project, and the absence of litigation, pend- ing or threatened, affecting the validity thereof , and C Escrow Agreement The execution of an escrow agreement with the Escrow Agent concerning the deposits to be made therewith in the Refunding Fund as herein provided and of any other agreement necessary or desirable to implement the provisions of this ordinance Section 39 Defeasance That when all principal, interest and prior redemption premiums, if any, in connec- tion with the bonds hereby authorized 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 ordi- nance There shall be deemed to be such due payment when the Council has placed in escrow and in trust with a commer- cial bank located within the State of Colorado and exercising full trust powers, an amount sufficient (including the known minimum yield from Federal Securities in which such amount may be initially invested) to meet all requirements of principal, interest and prior redemption premium, if any, as the same become due at their final maturities or upon designated prior redemption dates The Federal Securities so held shall become due prior to the respective times on which the proceeds thereof shall be needed, in accordance -64- with a schedule established and agreed upon between the Council and such bank at the time of the creation of the escrow, or the Federal Securities shall be subject to redemption at the option of the holders thereof to assure such availability as so needed to meet such schedule Section 40 Amendment of Ordinance A Limitations upon Amendments That this ordi- nance may be amended or supplemented by ordinances adopted by the Council in accordance with the laws of the State of Colorado, without receipt by the City of any additional consideration, but with the written consent of the holders of seventy-five per centum (75/) of the bonds authorized hereby and outstanding at the time of the adoption of such amendatory or supplemental ordinance (not including in any case any bonds which may then be held or owned for the account of the City, but including such refunding bonds as may be issued for the purpose of refunding any of the bonds herein authorized if such refunding bonds are not owned by the City) , provided, however, that no such ordinance shall have the effect of permitting (1) An extension of the maturity of any bond authorized hereby, or (2) A reduction in the principal amount of any bond, the rate of interest thereon, or the redemption premium payable thereon, or (3) The creation of a lien upon or a pledge of revenues ranking prior to the lien or pledge created hereby, or (4) A reduction of the principal amount of bonds required for consent to such amendatory or supplemental ordinance, or (5) The establishment of priorities as between bonds issued and outstanding under the provisions hereof or (6) The modification of or otherwise affecting the rights of the holders of less than all of the bonds then outstanding -65- B Notice of Amendment Whenever the City shall propose to amend or modify this ordinance under the provi- sions of this Section, it shall cause notice of the proposed amendment to be (1) Published one time in a newspaper, as herein defined and (2) Published one time in a financial newspaper or journal published in the City and County of Denver, Colorado Such notice shall briefly set forth the nature of the pro- posed amendment and shall state that a copy of the proposed amendatory ordinance is on file in the office of the City Clerk for public inspection C Time for Amendment Whenever at any time within one year from the date of the publication of said notice there shall be filed in the office of the City Clerk an instrument or instruments executed by the holders of at least seventy-five per centum (757) in aggregate amount of the bonds then outstanding as in this section defined, which instrument or instruments shall refer to the proposed amenda- tory ordinance described in said notice and shall specific- ally consent to and approve the adoption thereof, but not otherwise, the City Council may adopt such amendatory ordinance and such ordinance shall become effective D Binding Consent to Amendment If the holders of at least seventy-five per centum (757) in aggregate principal amount of the bonds outstanding as in this Section defined at the time of the adoption of such amendatory ordinance or the predecessors in title of such holders, 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 in this section provided shall have any right or interest to object to the adoption of such amenda- tory ordinance or to object to any of the terms or provi- sions therein contained or to the operation thereof or to enjoin or restrain the City from taking any action pursuant to the provisions thereof -66- E Time Consent Binding Any consent given by the holder of a bond pursuant to the provisions of this Sec- tion shall be irrevocable for a period of six months from the date of the publication of the notice above provided for and shall be conclusive and binding upon all future holders of the same bond during such period At any time after six months from the date of the publication of such notice, such consent may be revoked by the holder who gave such consent or by a successor in title by filing notice of such revoca- tion with the City Clerk, but such revocation shall not be effective if the holders of seventy-five per centum (757) in aggregate principal amount of the bonds outstanding as in this Section defined have, prior to the attempted revocation, consented to and approved the amendatory ordinance referred to in such revocation F Proof of Instruments The fact and date of the execution of any instrument under the provisions of this Section may be proved by the certificate of any officer in any ,jurisdiction who by the laws thereof is authorized to take acknowledgment of deeds within such jurisdiction, that the person signing such instrument acknowledged before him the execution thereof, or may be proved by an affidavit of a witness to such execution sworn to before such officer G Proof of Bonds The amount and numbers of the bonds held by any person executing such instrument and the date of his holding the same may be proved by a certifi- cate executed by a responsible bank or trust company showing that on the date therein mentioned such person had on deposit with such bank or trust company the bonds described in such certificate Section 41 Ordinance Irrepealable That after any of the bonds herein authorized are issued, this ordi- nance shall constitute a contract between the City and the holder or holders of the bonds from time to time and this ordinance shall be and remain irrepealable until the bonds and the interest on the bonds hereby authorized to be issued and in fact actually issued, shall be fully paid, cancelled, and discharged, as herein provided -67- Section 42 Severability Clause That if any section, paragraph, clause or provision of this ordinance shall for any reason be held to be invalid or unenforce- able, the invalidity or unenforceability of such section, paragraph, clause or provision shall not affect any of the remaining provisions of this ordinance Section 43 Repealer Clause That all ordinances, resolutions, by-laws and regulations of the City, in conflict with this ordinance, are hereby repealed to the extent only of such inconsistency This repealer shall not be construed to revive any ordinance, resolution, by-law, or regulation, or part thereof , heretofore repealed Section 44 Manner of Publication and Effective Date That this ordinance shall be published once in full at least ten days before its final passage in a newspaper, as herein defined, which publication shall contain a notice giving the date when said proposed ordinance will be presented for final passage Within five days after final passage, the ordinance as passed shall be published once in full as provided above, whereupon it shall take effect on the tenth day following its passage Section 45 Disposition of Ordinance That a true copy of this ordinance, immediately on its final pas- sage, shall be numbered and recorded in the book marked "Ordinance Record," and adoption and publication shall be authenticated by the signatures of the Mayor and City Clerk and by the certificate of the publisher, respectively INTRODUCED, READ IN FULL, PASSED ON FIRST READING AND ORDERED PUBLISHED this lltli day of Ma hc , 1965 14,E n v C, C,'- Ja T7 sa nl Mayor (SEAL) Attest City Clerk -68- NOTICE IS HEREBY GIVEN that at the regular meeting of the City Council, to be held or thgrsdgy ik the lst_ day of April 1965 , at the hour of it 30 o'clock T m , ---- - T-at the Council Chambers in the City Hall, in Fort Collins, Colorado, the City Council will hold a public hearing on the aforesaid proposed ordinance and thereafter will consider it for final passage and adoption yor (SEAL) Attest 14d use City Clerk / � Published in %r � o First publication 1965 PUBLISH ON -69- FINALLY PASSED AND ADOPTED this 1st day of April , 1965 Mayor (SEAL) Attest City Clerk Published in The Fort Collins Coloradoan Second publication (i e publication after final passage April 6 1965 I, Miles F House City Clerk, City of Fort Collins, County of Larimer, State of Colorado, do hereby certify that the above and foregoing ordinance is a true and correct copy of the ordinance introduced and passed on first reading at the regular meeting held on the llth day of March , 1965, read in full, published in full in The Fort Collins Coloradoan on the 16th day of March , 1965, and after holding a public hearing thereon, read a second time by title finally passed and adopted on the 1st day of April _, 1965 , and published in full a second time in Fort Collins Coloradoan on the 6th day of April 1965 (SEAL) Attest City Clerk -70- It was thereupon moved by Councilman Harvey G Johnson Qua. n and seconded by Councilkroman Lorraine A t9at 'the foregoing ordinance entitled "AN ORDINANCE AUTHORIZING THE ISSUANCE BY THE CITY OF FORT COLLINS, COLORADO, OF THE CITY' S NEGOTIABLE, COUPON "CITY OF FORT COLLINS, COLORADO, SEWER REFUND- ING AND IMPROVEMENT REVENUE BONDS, SERIES JUNE 11 1965" IN THE AGGREGATE PRINCIPAL AMOUNT OF $2,4929000 002 PROVIDING FOR THE REFUNDING, PAYMENT AND DISCHARGE AT THEIR RESPECTIVE MATURITIES OF THE CITY' S OUTSTAND- ING REVENUE BONDS PAYABLE OUT OF AND SECURED BY A PLEDGE OF REVENUES TO BE DERIVED FROM THE OPERATION OF THE CITY'S MUNICIPALLY OWNED AND OPERATED SEWER SYSTEM, AUTHORIZING THE DEPOSIT OF FUNDS SO TO REDEEM SUCH OUTSTANDING BONDS, AUTHORIZING THE IMPROVEMENT AND EXTENSION OF SAID SEWER SYSTEM BY THE CONSTRUCTION AND OTHER ACQUISITION OF ADDITIONAL SEWAGE COLLECTION AND TREATMENT FACILITIES AND EVERYTHING NECESSARY OR INCIDENTAL THERETO, AUTHORIZING THE ISSUANCE OF SUCH BONDS IN ANTICIPATION OF THE COLLECTION OF REVE- NUES OF SUCH SYSTEM FOR SUCH IMPROVEMENTS AND EXTEN- SIONS , PROVIDING THE FORM, TERMS AND CONDITIONS OF THE SEWER REFUNDING AND IMPROVEMENT BONDS, THE MANNER OF THEIR EXECUTION, THE METHOD OF PAYING THEM, AND THE SECURITY THEREFOR, PROVIDING FOR THE COLLECTION AND DISPOSITION OF REVENUES DERIVED AND TO BE DERIVED FROM SAID SEWER SYSTEM, PROVIDING OTHER DETAILS CON- CERNING THE REFUNDING AND IMPROVEMENT BONDS, SAID SEWER SYSTEM, THE BONDS TO BE REFUNDED, AND FUNDS APPERTAINING THERETO, INCLUDING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS IN CONNECTION THEREWITH, RATIFYING ACTION PREVIOUSLY TAKEN AND PROVIDING THE EFFECTIVE DATE HEREOF " and read in full at this meeting, as aforesaid, be passed on first reading and published in full in the Fort Collins Coloradoan, a newspaper of general circulation published in the City of Fort Collins, in its issue of March 16 , -71- 1965 , and that said ordinance, at least ten days after it is published as aforesaid and after a public hearing is held thereon at the meeting hereinafter designated, be considered for final passage at a regular meeting of the City Council to be held at the Council Chambers in the City Hall, in Fort Collins , Colorado, on _Thursday, the lst- day of April , 1965, at the hour of _ o'clock Ip m The question being upon the adoption of said mo- ta.on, the roll was called with the following result Those Voting Aye Harvey G Johnson R L Colwell L J McMillan James W Guyer Lorraine A Quinn Those Voting Nay None Those Absent None Five members of the City Council having voted in favor of said motion, the presiding officer thereupon declared said motion carried and said ordinance ordered published as aforesaid Thereupon, Councilman McMillan introduced the following resolution, which was read in full and is as follows -72- Y RESOLUTION A RESOLUTION PROVIDING FOR THE PUBLIC SALE OF THE CITY OF FORT COLLINS, COLORADO, SEWER REFUNDING ftND IMPROVEMENT REVENUE BONDS, SERIES JUNE 1 1965 WHEREAS, the City of Fort Collins (herein some- times designated as the "City") , in the County of Larimer and State of Colorado , has determined and does hereby determine , that the City of Fort Collins , Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965 (herein sometimes designated as the "bonds") , as authorized by an ordinance entitled "An ordinance authorizing the issuance by the City of Fort Collins, Colorado, of the City' s negotiable, coupon "City of Fort Collins , Colorado, Sewer Refund- ing and Improvement Revenue Bonds , Series June 1, 1965" in the aggregate principal amount of $2 ,492,000 00 , providing for the refunding, payment and discharge at their respective maturities of the City' s outstand- ing revenue bonds payable out of and secured by a pledge of revenues to be derived from the operation of the City' s municipally owned and operated sewer system, authorizing the deposit of funds so to redeem such outstanding bonds , authorizing the improvement and extension of said sewer system by the construction and other acquisition of additional sewage collection and treatment facilities and everything necessary or incidental thereto, authorizing the issuance of such bonds in anticipation of the collection of revenues of such system for such improvements and extensions , providing the form, terms and conditions of the sewer refunding and improvement bonds, the manner of their execution, the method of paying them, and the security therefor , providing for the collection and disposition of revenues derived and to be derived from said sewer system, providing other details concerning the refunding -73- and improvement bonds, said sewer system, the bonds to be refunded, and funds appertaining thereto, in- cluding but not limited to covenants and agreements in connection therewith, ratifying action previously taken and providing the eEfective date hereof " introduced and passed on first reading on the llth day of March t- , 1965 , should be publicly sold after the final adoption of said ordinance NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS Section 1 That Subseries I and Subseries R of the City of Fort Collins , Colorado, Sewer Refunding and Improvement Revenue Bonds, Series June 1, 1965 , in the principal amount of $2,492,000 00 be, and the same hereby are ordered to be, publicly advertised for sale , and that the City Council, on , Thursday the 6th day of May, t , 1965 , at the hour of 1-30 o'clock P m , at City Hall Council Chambers I e in the City, will cause sealed bids to be received and to be opened publicly for the purchase of the bonds of each subseries Section 2 That the Mayor and the Director of Finance be, and the same hereby are, authorized and directed A To have published a notice of sale of the bonds at least once at least five days prior to the sale date in each of the following (1) Fort Collins Coloradoan L ) a newspaper circulating in the City, and (2) Daily Journal a financial newspaper published in Denver , Colorado (being published in Denver, Colorado, San Francisco California Chicago Illinois or New York, New York) , and B To cause copies of such notice, the Official Notice of Bond Sale, or summaries thereof to be published or furnished to such other financial ,journals and to such prospective bidders as may be determined by said officers and the City' s Fiscal Agent -74- Section 3 That said notice of bond sale to be so published shall be in substantially the following form -75- (Form of Notice of Bond Sale for Publication) NOTICE OF BOND SALE CITY OF FORT COLLINS, COLORADO SEWER REFUNDING AND IMPROVEMENT REVENUE BONDS SERIES JUNE 1, 1965 - $2 ,492,000 00 NOTICE IS HEREBY GIVEN that the City Council of the City of Fort Collins , Colorado, on Thursday _, the 6th day of May , 1965 , at the hour of 1 30 - o'clock _p m , M S T , at City Hall Council Chambers in Fort Collins, Colorado , will cause sealed bids to be received and opened publicly for the purchdse of the nego- tiable, coupon improvement bonds in the principal amount of $2,2002000 00, designated as Subseries I (hereir sometimes designated as the "improvement bonds") and the negotiable, coupon refunding bonds in the principal amount of $292 000 00, designated as Subseries R (herein sometimes designated as the "refunding bonds") , comprising the City or Fort Collins, Colorado, Sewer Refunding and Improvement Bonds , Series June 1, 1965 , in the aggregate principal amount of $2 ,402,000 00 (herein sometimes designated as the "1965 revenue bonds") The 1965 revenue bonds shall be dated June 1, 1965 , and shall be payable to bearer Both princi- pal and interest of the 1965 revenue bonds shall be payable at the office of the Director o= F nance aid ex-offii-io City Treasurer, in Fort Collins, Colorado The improvement bonds sha.Ll consist of 440 bonus in the denomination of �5 ,000 00 each, numbeLed consecutive-y in regular numerical order from I-1 to I-440, both inclusive, bearing interest at a rate or rates of not exceeding four and one-half per centum (4-1/27) per annum from date until maturity, interest being payable on December 1, 1965 , and semiannually thereafter on June 1 ana December 1 in each year, and shall mature serially in regular numerical order on December 1 in each of the desigmted amounts and years -76- Amounts Years Amounts Years Maturing Maturing Maturing ing Maturing $509000 00 1967 $1302000 00 1977 559000 00 1968 1401000 00 1978 609000 00 1969 145 ,000 00 1979 659000 00 1970 1502000 00 1980 65,000 00 1971 155 000 00 1981 70,000 00 1972 1602000 00 1982 75000 00 1973 165 ,000 00 1983 120:000 00 1974 170,000 00 1984 1259000 00 1975 175 ,000 00 1985 1259000 00 1976 In conformity with the City Charter, improvement ' bonds maturing on and before December 1, 1974, shall be subject to prior redemption in regular numerical order on June 1, 1967, or on any interest payment date thereafter, for the principal amount , accrued interest and a premium of five per centum (57) of principal The prior redemption option hereinabove provided shall not be exercised for the purpose of refunding the bonds called for prior redemption without the specific written consent to such call by the holders of those bonds, except as hereinafter provided Improvement bonds maturing on and after December 1, 1975 , shall be subject to prior redemption for all purposes in inverse numerical order on December 1 1974, or on any inter- est payment date thereafter, for the principal amount accrued interest and a premium of one per centum (1/) of principal The refunding bonds shall consist of 60 bonds in the denomination of $5 ,000 00 each, except bonds numbered R-1 and R-2, which shall be in the denomination of $1,000 00 each, numbered consecutively in regular numerical order from R-1 to R-60, both inclusive, refunding bonds numbered R-1 to R-15, both inclusive, bearing interest at a rate or rates of not exceeding two and three-fourths per centum (2-3/47) per annum, refunding bonds numbered R-16 to R-60, both inclu- sive, bearing interest at a rate or sates of not exceeding three and one-fourth per centum (3-1/4/) per annum, interest being payable on December 1, 1965 , and semiannually there- after on June 1 and December 1 in each year, and shall -77- mature serially in regular numerical order on June 1 in each of the designated amounts and years Amounts Years Amounts Years Maturing Maturing Maturing Maturing $329000 00 1966 $359000 00 1970 35,000 00 1967 40,000 00 1971 35,000 00 1968 40,000 00 1972 35,000 00 1969 40,000 00 1973 In conformity with the City Charter, refunding bonds maturing on or before June 1, 1973, shall be subject to prior redemption for all purposes on December 1, 1965 , or on any interest payment date thereafter, for the princi- pal amount, accrued interest and a premium of five per centum (57) of principal The interest on all 1965 revenue bonds shall be evidenced by only one set of coupons (supplemental interest coupons, i e "B" coupons are not permitted) Not more than one interest rate shall be stated for the bonds of any maturity of a subseries The maximum interest spread per- mitted for the improvement bonds is 27 per annum Subject , to designated reservations, the bonds of each subseries shall be sold to the highest and best bidder for such subseries The 1965 revenue bonds are payable both as to principal and interest solely from, and their payment is additionally secured by a pledge of the net revenues derived from the operation of the sewer system, pursuant to an ordinance known as the 6-1-65 sewer revenue bond ordinance, introduced on . Marr_.b 11 1965 , reference to which is made for further details The legality of the 1965 revenue bonds will be approved by Messrs Dawson, Nagel, Sherman & Howard, Attorneys at Law Denver, Colorado, whose opinion, together with the printed bonds (including that opinion printed thereon) , and a certified transcript of legal proceedings, will be furnished to the purchaser of each subseries without charge The Official Notice of Bond Sale, of which this publication is a condensation said ordinance, a prospectus and financial and other information concerning said bonds -78- and the City may be obtained from its Fiscal Agent, Boettcher and Company, 828 Seventeenth Street, Denver Colorado 80202, and from Miles F House , City Clem P 0 Box 580 , Fort Collins, Colorado 80522 By order of the City Council dated s March 11 1965 /sjFor Manual Signature ) Mayor City of Fort Collins (SEAL) Attest /s/(For Manual Signature) City Clerk (End of Form of Notice for Publication) -79- Section 4 That the official notice of bond sale shall be in substantially the following form -80- y (Form of Official Notice of Bond Sale) OFFICIAL NOTICE OF BOND SALE CITY OF FORT COLLINS COLORADO SEWER REFUNDING AND IMPROVEMENT REVENUE BONDS SERIES JUNE 1 1965 - $21492,000 00 PUBLIC NOTICF IS HEREBY GIVEN that the City Council of the City of Fort Collins (herein sometimes designated as the "City Council" and as the "City," respectively) in the County of Larimer and State of Colorado, on Thursday , the 116th day of May 1965, at the hour of 1 30 o°clock p m , Mountain Standard Time, at City HallCouncil Chambers ' , in Fort Collins , Colorado, will cause sealed bids to be received and to be opened publicly for the purchase of two subseries of the negotiable, coupon, sewer refunding and improvement revenue bonds of the City, particularly described below BOND PROVISIONS SERIES "City of Fort Collins, Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965 ," in the aggregate principal amount of 82,492,000 00 (herein sometimes designated as the "1965 revenue bonds") , payable to bearer, and consisting of two subseries designated as Subseries I and Subseries R. as follows A Subseries I_ The bonds comprising Subseries I (herein sometimes designated as the "Improvement Bonds") shall consist of 440 bonds in the denomination of $5 ,000 00 each, issued for the purpose hereinafter stated, in the principal amount of $2 ,200,000 00, numbered consecutively in regular numerical order from 1-1 to I-440 both inclusive and berg numbered and maturing serially in regular numerical order on the first day of December in each of the designated amounts and years as follows -81- Bond Numbers Amounts Years (7011 I-iclusive) Maturing Maturing I- 1 to I- 10 $50 000 00 1967 I- 1I to I- 21 j5 ,000 00 1968 I- 22 to I- 33 601000 00 1969 I- 34 to I- 46 65 000 00 1970 I- 47 to I- 59 65 ,000 00 1971 I- 60 to T- 73 70 000 00 1972 I- 71 to I 88 75 ,000 00 1973 I- 89 to 1-112 120,000 00 1974 1-113 to 1-131 1253000 00 1975 I-138 to 1-162 125 000 00 1976 I-163 to 1-188 130,000 00 1977 1-189 to I-216 1405000 00 1978 1-217 to 1-245 145 000 00 1979 1-246 to I-275 1.)0,000 00 1980 T 276 to 1-306 155 000 00 1981 I-307 to I-333 160 000 00 1982 I-339 to 1-371 165 000 00 1983 1-372 to I-405 170 000 00 1984 1-406 to I-440 175 000 00 1985 and B Subseries R The bonds comprising Subseries R (herein sometimes designated as the "Refunding Bonds") shall consist of 60 bonds in the denomination of $5 ,000 00 each except for bonds rumbered F,,-1 and R 2 which shall be in the denomination of $1 000 00 each, issued for the purpose here- inafter stated in the principal amount of $292 000 00 numbered consecutively in regular numerical order from R-1 to R-60, both inclusive and being numbered and maturing seiiaLly in regular numerical order on the first day of June _n each of the designated amounts and years, as follows Bond Numbers Amounts Years (All Tnclusive) 1aturing Maturing R- 1 to R- 8 $32 000 00 1966 R- 9 to R-15 35 ,000 00 1967 R-16 to R-22 35 ,000 00 1968 R-23 to R-29 35 000 00 1969 R-30 to R-36 35 000 00 1970 R-37 to R-44 40 000 00 1971 R-45 to R-52 40 000 00 1972 R-53 to R-60 40,000 00 1973 PRIOR REDEMPTION A Subseries I Improvement Bonds numbered I-1 to I-112 , both inclusive , maturing on and before the first -82- 7 day of December, 1974, shall be subject to redemption prior to their respective maturities , at the option of the City, in regular numerical order, on the first day of June, 1967 or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each bond so redeemed, accrued interest thereon to the redemption date, and a pre- mium consisting of five per centum (5/) of the principal amount of each Improvement Bond so redeemed The prior redemption option hereinabove provided shall not be exer- cised for the purpose of refunding the Improvement Bonds called for prior redemption without the specific written consent to such call by the holders of those bonds , except as hereinafter provided For all purposes, including refund- ing Improvement Bonds numbered I-113 to I-440, both inclu- sive, maturing on and after the first day of December 1975 , shall be subject to redemption prior to their respective maturities, at the option of the City, in inverse numerical order on the first day of December, 1974, or on any inter- est payment date thereafter prior to maturity, upon payment of the principal amount of each bond so redeemed, accrued interest thereon to the redemption date, and a premium con- sisting of one per centum (1/) of the principal amount of each bond so redeemed B Subseries R For all purposes, Refunding Bonds numbered R-1 to R-60, both inclusive, maturing on or before the first day of June , 1973, shall be subject to redemption prior to their respective maturities, at the option of the City, in regular numerical order on the first day of December, 1965 , or on any interest payment date thereafter prior to maturity, upon payment of the principal amount of each Refunding Bond so redeemed, accrued interest thereon to the redemption date, and a premium con- sisting of five per centum (57) of the principal amount of each bond so redeemed An option to call the bonds of either subseries may be exercised independently of any option to call bonds of the other subseries In each instance thirty (30) days' -83- prior notice shall be given by publication and by mail addressed (among others) to any original purchaser of the bonds of a subseries or the manager of any purchasing syndicate The Charter of the City of Fort Collins requires that all bonds be sub3ect to prior redemption INTEREST RATES AND LIMITATIONS A The maximum interest rates are as follows 1 Four and one-half per centum (4-1/27) per annum for Improvement Bonds numbered I-1 to I-440, both inclusive, and 2 Two and three-fourths per centum (2-3/47) per annum for Refunding Bonds numbered R-1 to R-15 , both inclusive and 3 Three and one-fourth per centum (3-1/47) per annum for Refunding Bonds numbered R-16 to R-60, both inclusive B The maximum interest spread permitted for the Improvement Bonds is two per centum (2/) per annum, i e , the maximum rate of interest accruing on any Improvement Bond prior to its maturity cannot exceed the minimum rate of interest accruing on any other Improvement Bond prior to its maturity by more than two per centum (27) per annum There is no maximum interest spread for the Refunding Bonds Interest on all of the 1965 revenue bonds shall be evidenced until maturity by only one (1) set of coupons (supplemental interest coupons , i e , "B" coupons, are not permitted) payable to bearer and payable on the first day of December, 1965 , and semiannually thereafter on the first days of June and December in each year It is permissible to bid dif- ferent or "split" interest rates for said bonds , without limitation as to the number of rates specified, as stated only in the bid, provided, however, one interest rate only shall be stated for any maturity of any subseries Each rate stated must be in a multiple of one-eighth (1/8) or one-twentieth (1/20) of one per centum (17) per annum If any 1965 revenue bond shall not be paid upon presentation -84- at its maturity, it shall draw interest at the rate of six per centum (67) per annum until the principal thereof is paid in full PAYMENT Both the principal of and the interest on the 1965 revenue bonds will be payable to bearer in law- ful money of the United States of America, without deduction for exchange or collection charges , at the office of the Director of Finance and ex-officio City Treasurer, in Fort Collins , Colorado BOND ORDINANCE The ordinance authorizing the issuance of the 1965 revenue bonds is known as the 6-1-65 sewer revenue bond ordinance and was introduced and passed on first reading on the llth day of March , 1965 NO REGISTRATION FOR PAYMENT The 6-1-65 sewer revenue bond ordinance contains , and the bonds shall contain, no provision for the registration of the bonds for payment as to principal, or interest , or as to both principal and interest SECURITY All 1965 revenue bonds will, in the opinion of bond counsel, be payable, both as to principal and interest , solely from, and the payment of the bonds is se- cured by a pledge of, and they constitute an irrevocable and first lien (but not necessarily an exclusively first lien) upon, the revenues derived from the operation of the City°s municipal sewer system (herein sometimes designated as the "system") , except for revenues derived from the City° s exist- ing sewer trunk line assessments, sewer main line assessments , and sewer tap fees , and except for the plant investment fees which the City will impose by Ordinance No 17, 196J to be finally passed and adopted on the 15 th day of April 1965, subject only to the payment of all necessary and reasonable expenses of the operation and maintenance of the system, and as security for such payment there are exclusively pledged, pursuant to the 6-1-65 sewer revenue bond ordinance, two special funds identified as the "City of Fort Collins , Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965, Interest and Bond Retirement Fund," and the "City of Fort Collins , Colorado, Sewer Refunding and Improvement Revenue Bonds , Series June 1, 1965, Reserve Fund," into which the City covenants to pay -85- v from the net revenues derived from the sewer system, sums sufficient to pay when due the principal of and the interest on the bonds and to accumulate in about nine (9) years and to maintain thereafter a continuing debt service reserve for such purpose in the sum of $180,000 00 OUTSTANDING BONDS The City has issued no bonds which are now outstanding and to which any revenues derived by the City from the operation of the system are pledged for their payment, excepting, however, the City of Fort Collins Sewer and W-gte.r Revenue Bonds , dated March 1, 1948 (hereafter sometimes designated as the "1948 revenue bonds") , issued in the original principal amount of $195 ,000 00, con- sisting of 195 bonds in the denomination of $1,000 00 each, and maturing serially on March 1 in varying amounts of prin- cipal in each of the years 1949 to 1967 , both inclusive, of which bonds in the principal amount of $35 ,000 00 are pres- ently outstanding , consisting of bonds numbered 156 to 170, both inclusive, and 176 to 195 , both inclusive, and the City of Fort Collins Sewer Improvement Revenue Bonds, Series January 1, 1959 (herein sometimes designated as the "1959 revenue bonds") , issued in the original principal amount of $300,000 00, consisting of 300 bonds in the denomination of $1,000 00 each, and maturing serially on the first day of January in varying amounts of principal in each of the years 1960 to 1974, both inclusive, of which bonds in the principal amount of $257 ,000 00 are presently outstanding, consisting of bonds numbered 44 to 300, both inclusive The principal of the Refunding Bonds (with other moneys) will be used to refund, pay and discharge the interest on and the principal of the 1948 revenue bonds and the 1959 revenue bonds at their respective maturities ADDITIONAL OBLIGATIONS Bonds or other obligations subject to expressed conditions may be issued and made pay- able from the net revenues of the sewer system and having a lien thereon subordinate and ,junior to the lien, or, subject to additional expressed conditions, having a lien thereon on a parity with the lien of the 1965 revenue bonds herein -86- designated for sale, in accordance with the provisions of the bond ordinance AUTHORIZATION OF BONDS The 1965 revenue bonds herein offered for sale are to be issued pursuant to the 6-1-65 sewer revenue bond ordinance, therein prescribing, among other matters , the form, terms and conditions of the bonds, the manner and terms of their issuance, the manner of their execution, the method of paying them, the security therefor, the disposition of revenues derived from the sewer system, and other details concerning the bonds and the sewer system, including but not limited to covenants and agreements in connection therewith, reference to which ordinance is made for further details PURPOSE OF SERIES The Improvement Bonds are issued for the purpose of the improvement and extension of the City' s municipally owned and operated sewer system by the construction and other acquisition of additional sewage collection and treatment facilities and everything necessary or incidental thereto The Refunding Bonds were authorized to be issued for the purpose of refunding, paying and dis- charging a like principal amount of outstanding sewer revenue bonds (see "Outstanding Bonds" above) CORPORATE ORGANIZATION The City is a municipal corporation duly organized and existing as a home-rule city with a "Council-Manager government" under Article XX of the Constitution of the State of Colorado and a Charter framed and proposed by a charter convention elected on the 22nd day of June , 1954, and adopted by the qualified electors of the City at an election held therein on the 5th day of October, 1954 POPULATION The City' s population, as shown by the 1960 Federal Census, was 25 ,027, and the City' s popula- tion is currently estimated to be 33,000 -87- v TERMS OF SALE BID PROPOSALS No specified form of bid is required Any bidder is required to submit an unconditional and written bid for either or both subseries therein desig- nated specifying (1) The lowest rate or rates of interest and premium, if any, at or above par at which the bidder will purchase the bonds of each subseries bid upon It is also requested for informational purposes only but is not required that each bid disclose for each subseries bid upon (as computed from the date of the bonds) (2) The total net interest cost in dollars and cents to the City, and (3) The average net interest rate in a stated per centum Each bid must also be enclosed in a sealed envelope marked on the outside "Proposal for Bonds" and addressed to Mr Miles F House City Clerk P 0 Box 580 Fort Collins, Colorado 80522 Bids may be submitted by any bidder for either or both of the subseries herein designated for sale, but any bid must be for all the bonds of each subseries therein designated Any bid containing a provision requiring the acceptance of bids for both subseries will be rejected, unless each bid for each subseries so designated is the best bid therefor BID CHECK Each bid shall be accompanied by a separate cashier' s check of or a certified check drawn on a solvent bank or trust company for each subseries bid upon, made payable to the City of Fort Collins, in an amount of at least $75 ,000 00 for the Improvement Bonds and $10,000 00 for the Refunding Bonds Such checks will be held as evidence of good faith pending the delivery of the bonds , and such checksshall be promptly returned to any such bidder if his bid or bids be not accepted -88- V BIDDER' S OPTIONS It is permissible, subject to expressed limitations, for any bidder (1) To bid different or split interest rates for the bonds (see "Interest Rate" above) , and (2) To be relieved of the bidder' s obligation to purchase the bonds herein offered due to the repeal of the exemption for federal income taxes (see "Tax Status" below) TAX STATUS In the opinion of bond counsel, the interest on the bonds is exempt (1) From state income taxes of the State of Colorado under its present laws, and (2) From taxation by the United States under present federal income tax laws In the event that prior to the delivery of the bonds to the successful bidder for the bonds herein offered for sale, the income received by private holders from obligations of the same type and character shall be taxable by the terms of any federal income tax law hereafter enacted, the successful bidder at its election made prior to the delivery of the bonds , may be relieved of its obligations under the contract to purchase the bonds In such case the contract to pur- chase the bonds will terminate, and the deposit accompany- ing the purchaser' s bid will be returned upon written request therefor being made to and received by bond counsel prior to the delivery of the bonds SALE RESERVATIONS The City Council reserves the privilege (1) Of waiving any irregularity or informality in any bid (2) Of rejecting any and all bids for the bonds, and (3) Of reoffering the bonds for sale as provided by law BASIS OF AWARD The bonds of each subseries, subject to such reservations, will be sold to the highest and best responsible bidder making the bid for such subseries -89- v to the best advantage of the City, which bid will be deter- mined by deducting the amount of the premium bid, if any, from the total amount of interest which the City would be required to pay from the date of the bonds of such subseries to their respective maturity dates at the coupon rate or rates specified in the bid, without reference to the possible redemption of any of the bonds prior to maturity, and the award will be made on the basis of the lowest net interest cost to the City If there are two (2) or more equal bids for any subseries, and if such equal bids are the best bids received and are for not less than the principal amount of the bonds of said subseries and accrued interest, the City Council will determine which bid will be accepted SALE BELOW PAR, COMMISSION AND DISCOUNT PROHIBITED None of the 1965 revenue bonds will be sold at less than their principal amount and accrued interest to the date of delivery, nor will any discount or commission be allowed or paid on the sale of the bonds TIME OF AWARD The City Council will cause bids to be opened at the time hereinabove specified It intends to take action, upon determining the best bid or bids, awarding the bonds or rejecting all bids for the bonds of any subseries, at a regular meeting at City rlall Council Chambers , in Fort Collins, Colorado, convening at the hour of 1 30 o'clock ip m , Mountain Standard Time, of the day herein spe- cified for opening bids In any event the City Council will take action awarding the bonds or rejecting bids not later than twenty-four (24) hours after the expiration of the time herein specified for opening bids MANNER AND TIME OF DELIVERY The deposit of the best bidder for each subseries will be credited to the pur- chaser thereof at the time of delivery of the bonds (without accruing interest) If the successful bidder for any sub- series fails or neglects to complete the purchase of the bonds of said subseries within ten (10) days after the bonds of said subseries are made ready and are tendered by the City for delivery, the amount of this deposit will be -90- J forfeited (as liquidated damages for non-compliance with the bid) to the City, except as hereinafter provided In that event the City Council may reoffer the bonds of said subseries for sale as provided by law The purchaser of a subseries will not be required to accept delivery of any of the bonds thereof if all the bonds of said subseries are not tendered for delivery within seventy (70) days from the date herein stated for opening bids, and if the bonds are not so tendered within said period of time, the good faith deposit will be returned to the purchaser upon its request The City contem- plates however, effecting the delivery of the bonds of both subseries to the purchasers thereof in about forty-five (45) days from the date herein designated for opening bids and as soon as reasonably possible thereafter PAYMENT AT AND PLACE OF DELIVERY The successful bidder or bidders will be required to accept delivery of, and to make payment of the balance due for, the bonds of each subseries (1) At some bank or trust company in the City and County of Denver, Colorado, or (2) At the successful bidder' s request and expense , at some other bank or trust company in the United States of America, as requested Payment of the balance of the purchase price due for the bonds of a subseries at delivery must be made in funds acceptable to the City and to the bank or trust company designated as the place of delivery for immediate and unconditional credit to the City, or as directed by the City The place of deliv- ery of one subseries, however, shall not be so removed from the place of delivery of the other subseries as to make unnec- cessarily difficult their more or less simultaneous issuance The City reserves the right to limit the place of delivery as provided in this paragraph to the extent the City deems it desirable so to do to issue the Improvement Bonds and Refund- ing Bonds more or less simultaneously LEGAL OPINION, BONDS AND TRANSCRIPT The legality of the 1965 revenue bonds will be approved by Messrs Dawson, Nagel, Sherman & Howard, Attorneys at Law, 1900 First National -91- 1 Bank Building , Denver 2, Colorado whose unqualified, final, approving opinion, together with the printed bonds and a certified transcript of the legal proceedings , including a certificate stating that there is no litigation pending affecting the validity of the bonds as of the date of their delivery and other closing documents will be furnished the purchaser without charge by the City A certified true copy of the approving opinion of bond counsel shall be printed on each bond thereof at the City' s expense INFORMATION This Official Notice of Bond Sale (a condensation of which was ordered published) and financial and other information concerning the City and the 1965 revenue bonds may be obtained from the City' s City Clerk —�_ and its Fiscal Agent, respectively, as follows Mile-s F_s House _ _—_ _ 20ity'_Clerk� — _-- -- — _Z.=0�_Bcx_._580— — Ec t C o 111 as_,_.0 o.�_ado-- 8,9522 and Boettcher and Company 828 Seventeenth Street Denver, Colorado 80202 FORM OF OPINION The final and unqualified approv- ing opinion appertaining to the 1965 revenue bonds will recite, in conventional form, that the designated bond counsel has examined the Constitution and laws of the State of Colo- rado, the Charter of the City, and a certified copy of the record of the proceedings of the City Council taken prelim- inary to and in the issue of the bonds of the issue, describ- ing them in some detail and that bond counsel has examined bonds numbered I-1 and R-1 of said issue and has found the same properly executed and in due legal form The last paragraph of the opinion will read (subject to the provisions hereinabove entitled "Tax Status") substantially as follows -92- _& q "It is our opinion that "(1) Such proceedings show lawful authority for the 1965 revenue bonds under the laws of the State of Colorado and the City of Fort Collins now in force , "(2) The 1965 revenue bonds are valid and legal obligations of said City, payable, and payment shall be made, solely from the net revenues derived from the operation of the municipal sewer system (except for sewer trunk line assessments, sewer main line assess- ments, and sewer tap fees) , the net income of which is pledged therefor, and as security for such payment there are irrevocably and exclusively pledged two spe- cial funds identified as the 'City of Fort Collins, Colorado, Sewer Refunding and Improvement Revenue Bonds, Series June 1, 1965 , Interest and Bond Retire- ment Fund, ' and as the 'City of Fort Collins, Colorado, Refunding and Improvement Revenue Bonds, Series June 1, 1965 , Reserve Fund, ' into which funds the City has covenanted to pay from the revenues derived from the operation of the sewer system, after provision only for all necessary and reasonable expenses of the opera- tion and maintenance of the sewer system, sums suffi- cient to pay when due the principal of and the interest on the bonds , and to create and maintain a reasonable reserve for such purpose "(3) Said 1965 revenue bonds constitute an irre- vocable and first lien (but not necessarily an exclu- sively first lien) upon the revenues of said sewer system, subject to designated exceptions, after provi- sion only for the aforesaid payments of operation and maintenance expenses, "(4) The bonds comprising Subseries R have been issued to refund, pay and discharge, on and before the first day of January, 1974, the City' s revenue bonds outstanding in the aggregate principal amount of $292 000 00 and designated 'City of Fort Collins sewer anc water Revenue Bonds , ' dated March 1, 1948, and 'City of Fort Collins Sewer Improvement Revenue Bonds, Series January 1, 1959, ' the payment of the designated issues being refunded having been secured by a pledge of the net income of the municipal sewer system, but for the payment of which there have been deposited in escrow with THE FIRST NATIONAL s Bank in Fort Collins , Colorado, refunding bond proceeds, and other moneys , except to the extent of their investment in direct obligations of the United States of America, and, according to a report of Peat, Marwick, Mitchell & Co , certified public accountants, the escrow, together with the interest on and any other yield from said federal securities, is fully sufficient, at the time of the deposit and at all times subsequently, to -93- pay the principal of and the interest on the outstand- ing bonds so refunded as the same become due, and "(5) Interest on the 1965 revenue bonds is exempt from taxation by the United States of America under present federal income tax laws and such interest is also exempt from the state income taxes of the State of Colorado under its present laws " By order of the City Council of the City of Fort Collins , Colorado, dated this llth day of March , 1965 /s/(For Manual Signature) Mayor City of Fort Collins (SEAL) Attest Is/(For Manual Signature) City Clerk (End of Form of Official Notice of Bond Sale) -94- i Section 5 That bids for said bonds shall be opened at the time, place and manner provided in the Official Notice of Bond Sale as herein prescribed Section 6 That the officers of the City be, and they hereby are, authorized and directed to take all action necessary or appropriate to effectuate the provisions of this resolution Section 7 That all orders, by-laws and resolu- tions, or parts thereof, in conflict with this resolution, are hereby repealed Section 8 That if any one or more sections, sentences , clauses or parts of this resolution shall for any reason be questioned or held invalid, such judgment shall not affect impair or invalidate the remaining pro- visions hereof, but shall be confined in its operation to the specific sections, sentences, clauses or parts of this resolution so held invalid Section 9 That this resolution shall be in full force and effect after passage and approval PASSED AND APPROVED this llth day of March 1965 I$Vy (SEAL) Attest City Clerk -95- s ' s It was thereupon moved by Councilman L J. McMillan and seconded by Councilman R L Colwell that any rule of the City Council which would prevent the passage of said resolution at this meeting be suspended, and said resolution be placed upon its final passage The roll was called upon said motion with the following results Those Voting Aye Harvey G Johnson R L Colwell L J McMillan James W Guyer Lorraine A Q-uinn The presiding officer declared the motion carried and the rules suspended, and said resolution placed upon its final passage Quinn Counci*oman Lorraine A then moved that said resolution be passed as read Councilman James W Guyer seconded the motion The motion being upon the final passage of the resolution, the roll was called with the following results Those Voting Aye Harvey G Johnson R L Colwell L J McMillan James W Guyer Lorraine A Quinn The presiding officer thereupon declared that, at least a majority of the members present having voted in favor of said resolution, the said motion was carried and the resolution duly passed Thereupon, other business not appertaining to the City' s sewer system was considered Thereafter there being no further business to come before the meeting on motion duly made, seconded and unani- mously carried, the meeting was adjourned (gam,) U m6yor Attest City Clerk -96- STATE OF COLORADO ) COUNTY OF LARIMER ) SS CITY OF FORT COLLINS ) I Miles F House , City Clerk of the City of Fort Collins, in the County of Larimer and State of Colorado, do hereby certify 1 That the foregoing pages numbered from 1 to 96, both inclusive, constitute a full and correct copy of the record of the proceedings taken by the City Council of said City at a regular meeting thereof held on the llth day of March , 1965 , so fares said minutes relate to the City' s sewer bonds 2 That said copy of said ordinance contained in said minutes is a full, true and correct copy of the original of said ordinance as introduced and passed on first reading by the City Council at said meeting , that the original of said ordinance has been duly authenticated by the signatures of the Mayor of said City and myself as Clerk of said City 3 That said ordinance was on the 16th day of March , 1965 , published in full in the Fort Collins Coloradoan, a newspaper published, printed and of general circulation in the City of Fort Collins and being its offi- cial newspaper 4 That said copy of said resolution contained in said minutes is a full, true and correct copy of the original of said resolution as finally passed by the City Council at said meeting , that the original of said resolu- tion has been duly authenticated by the signatures of the Mayor of said City and myself as Clerk of said City 5 That the Mayor and five other members of the City Council were present at said meeting, and that five members of said Council voted as in said minutes set forth IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the City of Fort Collins this 16th day of March , 1965 (SEAL) City Clerk -97- The Clerk announced that an ordinance entitled "AN ORDINANCE AUTHORIZING THE ISSUANCE BY THE CITY OF FORT COLLINS, COLORADO, OF THE CITY' S NEGOTIABLE, COUPON "CITY OF FORT COLLINS, COLORADO, SEWER REFUNDING AND IMPROVEMENT BONDS, SERIES JUNE 12 1965" IN THE AGGREGATE PRINCIPAL AMOUNT OF $2,4922000 00, PROVIDING FOR THE REFUNDING, PAYMENT AND DISCHARGE AT THEIR RESPECTIVE MATURITIES OF THE CITY' S OUTSTANDING REVENUE BONDS PAYABLE OUT OF AND SECURED BY A PLEDGE OF REVE- NUES TO BE DERIVED FROM THE OPERATION OF THE CITY'S MUNICIPALLY OWNED AND OPERATED SEWER SYSTEM, AUTHORIZING THE DEPOSIT OF FUNDS SO TO REDEEM SUCH OUTSTANDING BONDS, AUTHORIZING THE IMPROVEMENT AND EXTENSION OF SAID SEWER SYSTEM BY THE CONSTRUCTION AND OTHER ACQUI- SITION OF ADDITIONAL SEWAGE COLLECTION AND TREATMENT FACILITIES AND EVERYTHING NECESSARY OR INCIDENTAL THERETO, AUTHORIZING THE ISSUANCE OF SUCH BONDS IN ANTICIPATION OF THE COLLECTION OF REVENUES OF SUCH SYSTEM FOR SUCH IMPROVEMENTS AND EXTENSIONS, PROVIDING THE FORM, TERMS AND CONDITIONS OF THE SEWER REFUNDING AND IMPROVEMENT BONDS, THE MANNER OF THEIR EXECUTION, THE METHOD OF PAYING THEM, AND THE SECURITY THEREFOR, PROVIDING FOR THE COLLECTION AND DISPOSITION OF REVE- NUES DERIVED AND TO BE DERIVED FROM SAID SEWER SYSTEM, PROVIDING OTHER DETAILS CONCERNING THE REFUNDING AND IMPROVEMENT BONDS, SAID SEWER SYSTEM, THE BONDS TO BE REFUNDED, AND FUNDS APPERTAINING THERETO, INCLUDING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS IN CONNEC- TION THEREWITH, RATIFYING ACTION PREVIOUSLY TAKEN AND PROVIDING THE EFFECTIVE DATE HEREOF " which ordinance was introduced, read in full for the first time and passed on first reading on the 11th day of March f 1965 , had, as ordered by the City Council, been published in full in the Fort Collins Coloradoan, a newspaper published and of general circulation in the City of Fort Collins, in its issue of arch 16 1965 , being at least ten days prior to this meeting, and that the publisher' s -100- affidavit of publication of said ordinance is now on file in the office of the City Clerk On motion duly made, seconded and unanimously carried, it was ordered that said affidavit be received, filed, and preserved among the records of the City Clerk Thereupon, the Mayor announced that this was the time and place of a public hearing on said ordinance, which he designated by title, and that anyone desiring to be heard should so indicate No one indicated he desired to be heard thereon Whereupon, it was moved by Councilwoman Lorraine A Quinn and seconded by Councilman James W Guyer , that said ordinance be placed on its second reading by title only, and that all rules of the Council which might prevent, unless suspended, the final passage and adoption of said ordinance at this meeting , be, and the same are hereby, suspended for the purpose of permitting the final passage and adoption of said ordinance at this meeting The question being upon the adoption of said motion and the suspension of the rules, the roll was called with the following result Those Voting Aye L J McMillan R L Colwell James W Guyer Lorraine A - Quinn Those Voting Nay None Those Absent harvey G Johnson Four members of the Council having voted in favor of said motion, the presiding officer declared said motion carried and the rules suspended No member of the Council having requested that the ordinance be read in full, said ordinance was read by the City Clerk by reading the title thereof -101- Whereupon, Councilman L J McMillan moved that said ordinance heretofore passed on first reading, be now placed upon its final passage Counci�woman Lorraine A _Quinn seconded the motion The question being upon the placing of said ordinance upon its final passage, the roll was called with the following results Those Voting Aye L J McMillan R L Colwell James W. Guyer Lorraine A. Guinn Those Voting Nay None Those Absent Harvey G. Johnson The presiding officer declared the motion carried and said ordinance placed upon its dial passage uinn Counci'woman Lorraine A. then moved that said ordinance be finally passed and adopted Councilman James W Guyer seconded the motion The question being upon the passage and adoption of said ordinance, the roll was called with the following results Those Voting Aye L J McMillan R L Colwell --James W Guyer Lorraine A Quinn Those Voting Nay None Those Absent Harvey G Johnson The presiding officer thereupon declared that at least a majority of the members present having voted in -102- N� favor thereof, the said motion was carried and the said ordinance duly passed and adopted On motion duly adopted, it was ordered that said ordinance be numbered lj 196K, and after signature by the Mayor of said City and attestation by the City Clerk, be finally published in the Fort Collins Coloradoan, a news- paper published and of general circulation in the City of Fort Collins Colorado, and be recorded according to law Thereupon the City Council considered other business and took other action not concerning the City' s sewer system There being no further business to come before the City Council, on motion duly made, seconded and unanimously carried, the meeting adjourned Ass s MaY r (SEAL) Attest J L 2:�-IL z�� - City Clerk -103- STATE OF COLORADO ) COUNTY OF LARIMER ) 5S CITY OF FORT COLLINS ) I, Miles F House City Clerk of the City of Fort Collins, Colorado, do hereby certify 1 That the foregoing Ordinance No 15 1965 was read in full and passed on first reading and ordered pub- lished at a regular meeting of the City Council held on Thursday , the llth day of March , 1965 , and was published in full on the 16th day of March , 19659 in the Fort Collins Coloradoan, a newspaper printed, pub- lished and of general circulation in the City of Fort Collins 2 That at least ten days thereafter said ordi- nance was placed on second reading and final passage at a regular meeting of the City Council held on Thursdav , the 1st day of April , 1965 that at said meeting said ordinance was read by title, finally passed, adopted, approved and ordered published in full again 3 That thelb Ms and three other members of the City Council were present at the second meeting, that the members of said City Council voted on the passage of saia ordinance as in said minutes set forth 4 That said ordinance was, on the 6th day of April _, 1965 , published in full in the 'fort Collins Coloradoan, the same being the official newspaper of said City, published and of general circulation therein and was recorded as provided in said ordinance and the Charter of the City of Fort Collins 5 That the foregoing pages numbered 99 to 103, both inclusive are a true, full and correct copy of the proceedings of the City Council of said City, insofar as said minutes relate to the final adoption of Ordinance No 15 , 1965, a copy of which ordinance is set forth in full -104- in the minutes of the meeting held on the 18t day of -April , 1965 , and a copy of which is likewise attached to the affidavit of the publisher on file in my office 6 That all members of the City Council were duly notified of each of said meetings IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the City of Fort Collins, Colorado, this 14th day of April 1965 City Clerk (SEAL) -105-