HomeMy WebLinkAbout2007-06-18-Resolutions 07-114_Bonds - Natural Gas Revenue Series 2007 - IssuanceRESOLUTION NO.07-114
Resolution authorizing and approving a Loan Agreement and providing for the
sale and issuance and securing the payment of $5,675,000 Natural Gas Utility
System Revenue Bonds,Series 2007
WHEREAS,the City of Waukee,in the County of Dallas,State of Iowa (hereinafter
referred to as the "City"),did heretofore establish a Municipal Natural Gas Utility System in and
for the City (hereinafter referred to as the "Utility");and
WHEREAS,the management and control of the Utility are vested in the City Council,
and no board of trustees exists for this purpose;and
WHEREAS,pursuant to Section 384.24A of the Code ofIowa,notice duly published and
a hearing held thereon,the City has heretofore determined to contract indebtedness and enter into
a Natural Gas Utility System Revenue Loan Agreement (the "Loan Agreement")and to issue a
corresponding issue of Natural Gas Utility System Revenue Bonds,Series 2007,in the principal
amount of $5,675,000 (the "Bonds")to provide funds to the cost,to that extent,of constructing
improvements and extensions to the Utility (the "Project");and
WHEREAS,pursuant to advertisement of sale,bids for the purchase of the Bonds were
received and canvassed on behalf of the City and the substance of such bids noted in the minutes
and,upon final consideration of all bids received for the purchase of the Bonds,the bid of
Bernardi Securities,is the best,such bid proposing the lowest interest cost to the City;
NOW,THEREFORE,Be It Resolved by the City Council of the City of Waukee,Iowa,
as follows:
Section I.The bid referred to in the preamble hereof is hereby accepted,and it is
hereby determined that the City shall enter into the Loan Agreement with the aforesaid bidder
(hereinafter referred to as the "Purchaser"),in substantially the form as will be presented the City
Council,providing for a loan to the City in the amount of $5,675,000,for the purpose or
purposes set forth in the preamble hereof and to fund necessary reserves.
The Mayor and City Clerk are authorized and directed to sign the Loan Agreement on
behalf of the City,and the Loan Agreement is hereby approved.
Section 2.The Bonds,dated July 9,2007,in the denomination of$5,000 each,or any
integral multiple thereof,maturing on June I in each of the years,in the respective principal
amounts and bearing interest at the respective rates,as follows:
Principal Interest Rate Principal Interest Rate jYearAmountPerAnnumYearAmountPerAnnum
2008 $275,000 4.50%2016 $390,000 4.50%
2009 $285,000 4.50%2017 $405,000 4.50%
2010 $300,000 4.50%2018 $425,000 4.50%
2011 $315,000 4.50%2019 $440,000 4.60%
2012 $325,000 4.50%2020 $460,000 4.70%
2013 $340,000 4.50%2021 $485,000 4.70%
2014 $355,000 4.50%2022 $505,000 4.70%
2015 $370,000 4.50%
are hereby awarded and authorized to be issued to the Purchaser in the total aggregate principal
amount of $5,675,000,at the price specified in the Purchaser's bid (hereinafter referred to as the
"Sale Agreement"),in evidence of the obligation of the City under the Loan Agreement.
Section 3.The Mayor and City Clerk are hereby authorized and directed to execute
the Sale Agreement on behalf of the City,and the Sale Agreement is hereby approved.
Bankers Trust Company,N.A.,Des Moines,Iowa,is hereby designated as the Registrar
and Paying Agent for the Bonds and may be hereinafter referred to as the "Registrar"or the
"Paying Agent".
The City reserves the right to prepay part or all of the Bonds maturing in each of the
years 2016 to 2022,inclusive,prior to and in any order of maturity on June 1,2015,or on any
date thereafter upon terms of par and accrued interest.If less than all of the Bonds of any like
maturity are to be redeemed,the particular part of the Bonds to be redeemed shall be selected by
the Registrar by lot.The Bonds may be called in part in one or more units of $5,000.Ifless than
the entire principal amount of any Bond in a denomination of more than $5,000 is to be
redeemed,the Registrar will issue and deliver to the registered owner thereof,upon surrender of
such original Bond,a new Bond or Bonds,in any authorized denomination,in a total aggregate
principal amount equal to the unredeemed balance of the original Bond.Notice of such
redemption as aforesaid identifying the Bond or Bonds (or portion thereof)to be redeemed shall
be mailed by certified mail to the registered owners thereof at the addresses shown on the City's
registration books not less than 30 nor more than 60 days prior to such redemption date.All of
such Bonds as to which the City reserves and exercises the right of redemption and as to which
notice as aforesaid shall have been given and for the redemption of which funds are duly
provided,shall cease to bear interest on the redemption date.
All of the interest on the Bonds shall be payable semiannually on the first day of June and
December in each year,commencing December I,2007.Interest shall be calculated on the basis
of a 360-day year comprised of twelve 30-day months.Payment of interest on the Bonds shall
be made to the registered owners appearing on the registration books of the City at the close of
business on the fifteenth day of the month next preceding the interest payment date and shall be
paid by check or draft mailed to the registered owners at the addresses shown on such
registration books.Principal of the Bonds shall be payable in lawful money of the United States
of America to the registered owners or their legal representatives upon presentation and
surrender of the Bond or Bonds at the office of the Paying Agent.
The Bonds shall be executed on behalf of the City with the official manual or facsimile
signature of the Mayor and attested with the official manual or facsimile signature of the City
Clerk and shall have the City's seal impressed or printed thereon,and shall be fully registered
Bonds without interest coupons.The issuance of the Bonds shall be recorded in the office of the
City Treasurer,and the certificate on the back of each Bond shall be executed with the official
manual or facsimile signature of the City Treasurer.In case any officer whose signature or the
facsimile of whose signature appears on the Bonds shall cease to be such officer before the
delivery of such Bonds,such signature or such facsimile signature shall nevertheless be valid and
sufficient for all purposes,the same as if such officer had remained in office until delivery.
The Bonds shall not be valid or become obligatory for any purpose until the Certificate of
Authentication thereon shall have been signed by the Registrar.
All of the Bonds and the interest thereon,together with any additional obligations as may
be hereafter issued and outstanding from time to time ranking on a parity therewith under the
conditions set forth herein (which additional obligations are hereinafter sometimes referred to as
"Parity Obligations"),shall be payable solely from the Net Revenues of the Utility and the
Sinking Fund hereinafter referred to,both of which are hereby pledged to the payment of the
Bonds.The Bonds shall be a valid claim of the owners thereof only against said Net Revenues
and Sinking Fund.None of the Bonds shall be a general obligation of the City,nor payable in
any manner by taxation,and under no circumstances shall the City be in any manner liable by
reason of the failure of the Net Revenues of the Utility to be sufficient for the payment in whole
or in part of the Bonds and the interest thereon.
The Bonds shall be fully registered as to principal and interest in the names of the owners
on the registration books of the City kept by the Registrar,and after such registration,payment of
the principal and interest thereof shall be made only to the registered owners,their legal
representatives or assigns.Each Bond shall be transferable only upon the registration books of
the City upon presentation to the Registrar,together with either a written instrument of transfer
satisfactory to the Registrar or the assignment form thereon completed and duly executed by the
registered owner or the duly authorized attorney for such registered owner.
The record and identity of the owners of the Bonds shall be kept confidential as provided
by Section 22.7 of the Code ofIowa.
Section 4.Notwithstanding anything above to the contrary,the Bonds shall be issued
initially as Depository Bonds,with one fully registered Bond for each maturity date,in principal
amounts equal to the amount of principal maturing on each such date,and registered in the name
of Cede &Co.,as nominee for The Depository Trust Company,New York,New York ("DTC").
On original issue,the Bonds shall be deposited with DTC for the purpose of maintaining a
book-entry system for recording the ownership interests of its participants and the transfer of
those interests among its participants (the "Participants").In the event that DTC determines not
to continue to act as securities depository for the Bonds or the City determines not to continue
the book-entry system for recording ownership interests in the Bonds with DTC,the City will
discontinue the book-entry system with DTC.If the City does not select another qualified
securities depository to replace DTC (or a successor depository)in order to continue a
book -entry system,the City will register and deliver replacement bonds in the form of fully
registered certificates,in authorized denominations of $5,000 or integral multiples of $5,000,in
accordance with instructions from Cede &Co.,as nominee for DTC.In the event that the City
identifies a qualified securities depository to replace DTC,the City will register and deliver
replacement bonds,fully registered in the name of such depository,or its nominee,in the
denominations as set forth above,as reduced from time to time prior to maturity in connection
with redemptions or retirements by call or payment,and in such event,such depository will then
maintain the book-entry system for recording ownership interests in the Bonds.
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Ownership interest in the Bonds may be purchased by or through Participants.Such
Participants and the persons for whom they acquire interests in the Bonds as nominees will not
receive certificated Bonds,but each such Participant will receive a credit balance in the records
of DTC in the amount of such Participant's interest in the Bonds,which will be confirmed in
accordance with DTC's standard procedures.Each such person for which a Participant has an
interest in the Bonds,as nominee,may desire to make arrangements with such Participant to
have all notices of redemption or other communications of the City to DTC,which may affect
such person,forwarded in writing by such Participant and to have notification made of all
interest payments.
The City will have no responsibility or obligation to such Participants or the persons for
whom they act as nominees with respect to payment to or providing of notice for such
Participants or the persons for whom they act as nominees.
As used herein,the term "Beneficial Owner"shall hereinafter be deemed to include the
person for whom the Participant acquires an interest in the Bonds.
DTC will receive payments from the City,to be remitted by DTC to the Participants for
subsequent disbursement to the Beneficial Owners.The ownership interest of each Beneficial
Owner in the Bonds will be recorded on the records of the Participants whose ownership interest
will be recorded on a computerized book-entry system kept by DTC.
When reference is made to any action which is required or permitted to be taken by the
Beneficial Owners,such reference shall only relate to those permitted to act (by statute,
regulation or otherwise)on behalf of such Beneficial Owners for such purposes.When notices
are given,they shall be sent by the City to DTC,and DTC shall forward (or cause to be
forwarded)the notices to the Participants so that the Participants can forward the same to the
Beneficial Owners.
Beneficial Owners will receive written confirmations of their purchases from the
Participants acting on behalf of the Beneficial Owners detailing the terms of the Bonds acquired.
Transfers of ownership interests in the Bonds will be accomplished by book entries made by
DTC and the Participants who act on behalf of the Beneficial Owners.Beneficial Owners will
not receive certificates representing their ownership interest in the Bonds,except as specifically
provided herein.Interest and principal will be paid when due by the City to DTC,then paid by
DTC to the Participants and thereafter paid by the Participants to the Beneficial Owners.
Section 5.The Bonds shall be in substantially the following form:
(Form of Bond)
UNITED STATES OF AMERICA
STATE OF IOWA COUNTY OF DALLAS
CITY OF WAUKEE
NATURAL GAS UTILITY SYSTEM REVENUE BOND,
SERIES 2007
No._$
RATE MATURITY DATE BOND DATE CUSIP
July 9,2007
The City of Waukee (the "City"),in the County of Dallas,State of Iowa,for value
received,promises to pay on the maturity date of this Bond to:
or registered assigns,the principal sum of
DOLLARS
in lawful money of the United States of America upon presentation and surrender of this Bond at
the office of Bankers Trust Company,N.A.,Des Moines,Iowa (hereinafter referred to as the
"Registrar"or the "Paying Agent"),with interest on said sum,until paid,at the rate per annum
specified above from the date of this Bond,or from the most recent interest payment date on
which interest has been paid,on June I and December I of each year,commencing December I,
2007,except as the provisions hereinafter set out with respect to redemption prior to maturity
may be or become applicable hereto.Interest on this Bond is payable to the registered owner
appearing on the registration books of the City at the close of business on the fifteenth day of the
month next preceding the interest payment date,and shall be paid by check or draft mailed to the
registered owner at the address shown on such registration books.Interest shall be calculated on
the basis of a 360-day year comprised of twelve 30-day months.
This Bond shall not be valid or become obligatory for any purpose until the Certificate of
Authentication hereon shall have been signed by the Registrar.
This Bond is one of a series of Natural Gas Utility System Revenue Bonds,Series 2007
(the "Bonds"),issued in the aggregate principal amount of $5,675,000 by the City to evidence its
obligation under a certain Natural Gas Utility System Revenue Loan Agreement,dated as of July
9,2007 (the "Loan Agreement"),for the purpose of paying costs of constructing improvements
and extensions to the Municipal Natural Gas Utility System of the City and the funding of
necessary reserves.
The Bonds are issued pursuant to and in strict compliance with the provisions of
Chapter 384 of the Code of Iowa,2007,and all other laws amendatory thereof and supplemental
thereto,and in conformity with a resolution of the City Council authorizing and approving the
Loan Agreement and providing for the issuance and securing the payment of the Bonds (the
"Resolution"),and reference is hereby made to the Resolution and the Loan Agreement for a
more complete statement as to the source of payment of the Bonds and the rights of the owners
of the Bonds.
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The City reserves the right to prepay part or all of the Bonds maturing in each of the
years 2016 to 2022,inclusive,prior to and in any order of maturity on June 1,2015,or on any
date thereafter upon terms of par and accrued interest.If less than all of the Bonds of any like
maturity are to be redeemed,the particular part of the Bonds to be redeemed shall be selected by
the Registrar by lot.The Bonds may be called in part in one or more units of $5,000.Ifless than
the entire principal amount of any Bond in a denomination of more than $5,000 is to be
redeemed,the Registrar will issue and deliver to the registered owner thereof,upon surrender of
such original Bond,a new Bond or Bonds,in any authorized denomination,in a total aggregate
principal amount equal to the unredeemed balance of the original Bond.Notice of such
redemption as aforesaid identifying the Bond or Bonds (or portion thereof)to be redeemed shall
be mailed by certified mail to the registered owners thereof at the addresses shown on the City's
registration books not less than 30 nor more than 60 days prior to such redemption date.All of
such Bonds as to which the City reserves and exercises the right of redemption and as to which
notice as aforesaid shall have been given and for the redemption of which funds are duly
provided,shall cease to bear interest on the redemption date.
The Bonds are not general obligations of the City but,together with any additional
obligations as may be hereafter issued and outstanding from time to time ranking on a parity
therewith under the conditions set forth in the Resolution,are payable solely and only out of the
future Net Revenues of the Municipal Natural Gas Utility System of the City,a sufficient portion
of which has been ordered set aside and pledged for that purpose.This Bond is not payable in
any manner by taxation,and under no circumstances shall the City be in any manner liable by
reason of the failure of the said Net Revenues to be sufficient for the payment of this Bond and
the interest hereon.
This Bond is fully negotiable but shall be fully registered as to both principal and interest
in the name of the owner on the books of the City in the office of the Registrar,after which no
transfer shall be valid unless made on said books and then only upon presentation of this Bond to
the Registrar,together with either a written instrument of transfer satisfactory to the Registrar or
the assignment fOlID hereon completed and duly executed by the registered owner or the duly
authorized attorney for such registered owner.
The City,the Registrar and the Paying Agent may deem and treat the registered owner
hereof as the absolute owner for the purpose of receiving payment of or on account of principal
hereof,premium,if any,and interest due hereon and for all other purposes,and the City,the
Registrar and the Paying Agent shall not be affected by any notice to the contrary.
And It Is Hereby Certified,Recited and Declared that all acts,conditions and things
required to exist,happen and be performed precedent to and in the issuance of the Bonds have
existed,have happened and have been performed in due time,form and manner,as required by
law,and that the issuance of the Bonds does not exceed or violate any constitutional or statutory
limitation or provision.
IN TESTIMONY WHEREOF,the City of Waukee,Iowa,by its City Council,has caused
this Bond to be sealed with the facsimile of its official seal,to be executed with the duly
authorized facsimile signature of its Mayor and attested with the duly authorized facsimile
signature of its City Clerk,all as of July 9,2007.
CITY OF WAUKEE,IOWA
By (DO NOT SIGN)
Mayor
Attest:
(DO NOT SIGN)
City Clerk
(Facsimile Seal)
Registration Date:(Registration Date)
REGISTRAR'S CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in the within-mentioned Resolution.
BANKERS TRUST COMPANY,NA
Des Moines,Iowa
Registrar
By (Authorized Signature)
Authorized Officer
STATE OF IOWA
CITY OF WAUKEE
COUNTY OF DALLAS
SS:CITY TREASURER'S CERTIFICATE
The original issuance of the Bonds,of which this Bond is a part,was duly and properly
recorded in my office as of July 9,2007.
(DO NOT SIGN)
City Treasurer
ABBREVIATIONS
The following abbreviations,when used in this Bond,shall be construed as though they
were written out in full according to applicable laws or regulations:
TEN COM
TENENT
as tenants in common
as tenants by the entireties
UTMA _
(Custodian)
JTTEN as joint tenants with
right of survivorship and
not as tenants in common
As Custodian for _
(Minor)
under Uniform Transfers to Minors Act
(State)
Additional abbreviations may also be used though not in the list above.
ASSIGNMENT
For valuable consideration,receipt of which is hereby acknowledged,the undersigned
assigns this Bond to
(Please print or type name and address of Assignee)
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
and does hereby irrevocably appoint ,Attorney,to transfer this
Bond on the books kept for registration thereof with full power of substitution.
Dated:
Signature gnaranteed:
(Signature guarantee must be provided in accordance
with the prevailing standards and procedures of the
Registrar and Transfer Agent.Such standards and
procedures may require signatures to be guaranteed by
certain eligible guarantor institutions that participate in a
recognized signature guarantee program.)
NOTICE:The signature to this Assignment must
correspond with the name of the registered owner as it
appears on this Bond in every particular,without
alteration or enlargement or any change whatever.
Section 6.The Bonds shall be executed as herein provided as soon after the adoption
of this resolution as may be possible and thereupon they shall be delivered to the Registrar for
registration,authentication and delivery to the Purchaser,upon receipt of the loan proceeds (the
"Loan Proceeds"),and all action heretofore taken in connection with the Loan Agreement is
hereby ratified and confirmed in all respects.The Loan Proceeds,exclusive of any accrued
interest,shall be used to pay costs of the Project,and the funding of necessary reserves,and any
unexpended balance of the Loan Proceeds remaining thereafter,plus any amount received by the
City as accrued interest,shall be converted into the Sinking Fund hereinafter created and used to
pay interest due on the Bonds on the first interest payment date.
Section 7.So long as any of the Bonds or any Parity Obligations are outstanding,the
City shall continue to maintain the Utility in good condition,and the Utility shall continue to be
operated in an efficient manner and at a reasonable cost as a revenue producing undertaking.
The City shall establish,impose,adjust and provide for the collection of rates to be charged to
customers of the Utility,including the City.On or before the beginning of each fiscal year,the
City will adopt,or continue in effect,rates for all services rendered by the Utility which will
produce gross revenues (the "Gross Revenues")for the next succeeding fiscal year at least
sufficient to pay the expenses of operation and maintenance of the Utility,which shall include
salaries,wages,cost of maintenance and operation,materials,supplies,insurance and all other
items normally included under recognized accounting practices (but does not include allowances
for depreciation in the valuation of physical property)(which such expenses are hereinafter
sometimes referred to as the "Operating Expenses")and to leave a balance of net revenues (the
"Net Revenues")equal to at least 125%of the annual instalhnents of principal of and interest on
all of the Bonds and any Parity Obligations outstanding from time to time,as the same become
due,and sufficient to maintain a reasonable reserve for the payment of such principal and
interest,as hereinafter provided.
Section 8.From and after the issuance of the Bonds,the Gross Revenues of the
Utility shall be set aside into a separate and special fund which is hereby established,to be
known and hereinafter referred to as the Natural Gas Utility Revenue Fund (the "Revenue
Fund").The Revenue Fund shall be used iu maintaining and operating the Utility,and after
payment of the Operating Expenses shall,to the extent hereinafter provided,be used to pay the
principal of and interest on the Bonds and any Parity Obligations,and to create and maintain the
several separate funds hereinafter established.
Section 9.There is hereby created,and there shall be maintained,an account to be
known as the Natural Gas Utility Revenue Sinking Fund (the "Sinking Fund"),into which there
shall be set aside from the future Net Revenues of the Utility such portion thereof as will be
sufficient to pay the interest upon and principal of the Bonds as the same become due,and it is
hereby determined that the minimum amount to be so set aside into the Sinking Fund from the
Net Revenues during each month of each year shall be not less than as follows:
beginning on or before August 1,2007,and continuing through November I,
2007,a sum equal to one-fourth (1/4)of the interest becoming due on the Bonds
on December I,2007;
beginning on or before August 1,2007,and continuing through May 1,2008,a
sum equal to one-tenth (1/10)of the principal of the Bonds maturing on June 1,
2008;)
beginning on December 1,2007,and continuing thereafter,a sum equal to
one-sixth (1/6)of the interest becoming due on the next succeeding interest
payment date on all of the outstanding Bonds;and
beginning on June 1,2008,and continuing thereafter,a sum equal to
one-twelfth (1/12)of the principal of all of the Bonds maturing on the June 1 next
succeeding;
provided,however,that no further payments need to be made into the Sinking Fund when and so
long as the amount therein is sufficient to retire the Bonds and any Parity Obligations then
outstanding which are payable from the Sinking Fund and to pay all interest to become due
thereon prior to such retirement,or if provision for such payment has been made.
Whenever Parity Obligations are issued under the conditions and restrictions hereinafter
set forth,provisions shall be made for additional payments to be made into the Sinking Fund for
the purpose of paying the interest on and principal of such Parity Obligations.
The Sinking Fund and that portion of the Net Revenues contained therein shall be used
solely and only and are hereby pledged for the purpose of paying the interest on and the principal
of the Bonds and Parity Obligations.
If at any time there be a failure to pay into the Sinking Fund the full amount above
stipulated,then an amount equivalent to the deficiency shall be paid into the Sinking Fund from
the Net Revenues of the Utility as soon as available,and the same shall be in addition to the
amount otherwise required to be so set apart and paid into the Sinking Fund.
Such payments into the Sinking Fund shall be made in equal monthly installments on the
first day of each month,except that when the first day of any month does not fall on a regular
business day,then such payments shall be made on the next succeeding business day.
Section 10.There is hereby created a special fund to be known and designated as the
Principal and Interest Reserve Fund (hereinafter referred to as the "Reserve Fund"),into which
there shall be set apart and paid from the Loan Proceeds at the time of the delivery of the Bonds
a sum equal to the lesser of:(i)the maximum amount of principal and interest becoming due on
the Bonds and any Parity Obligations in any succeeding fiscal year,(ii)125%of the average
amount of principal of and interest becoming due on the Bonds and any Parity Obligations in any
succeeding fiscal year;or (iii)10%of the principal amount of the Bonds and any Parity
Obligations (the "Required Reserve Fund Balance"),which amount has been determined to be
$535,015.Thereafter,whenever the sum on deposit in the Reserve Fund has been reduced to
less than the Required Reserve Fund Balance by the expenditure of all or a portion of the funds
on deposit therein for any of the purposes specified herein,there shall be deposited into the
Reserve Fund the remaining Net Revenues after first making the required deposits into the
Sinking Fund,until the sum on deposit in the Reserve Fund has been restored to the Required
Reserve Fund Balance.Whenever there is on hand in the Reserve Fund an amount equal to the
Required Reserve Fund Balance,no further deposits need to be made into the Reserve Fund
except to maintain such Required Reserve Fund Balance,and if the amount on deposit in the
Reserve Fund is greater than the Required Reserve Fund Balance,such additional amounts shall
be withdrawn and paid into the Revenue Fund.
Section 11.There is hereby created a special fund to be known and designated as the
Surplus Fund into which there shall be set apart and paid all of the Net Revenues remaining after
first making the required payments into the Sinking Fund and the Reserve Fund,and after the
Reserve Fund contains the Required Reserve Fund Balance.All money credited to the Surplus
Fund shall be transferred and credited to the Sinking Fund whenever necessary to prevent or
remedy a default in the payment of the principal of or interest on the Bonds and any Parity
Obligations or shall be transferred and credited to the Reserve Fund whenever any deficiency
may exist in the Reserve Fund.
As long as the Sinking Fund and the Reserve Fund have the full amounts required to be
deposited therein by this resolution,any balance in the Surplus Fund may be made available to
the City as the City Council,or such other duly constituted body as may then be charged with the
operation ofthe Utility,may from time to time direct.
Section 12.All money held in any fund created or to be maintained under the terms of
this resolution shall be deposited in lawful depositories of the City or invested in accordance
with Chapters l2B and l2C of the Code ofIowa and continuously held and secured as provided
by the laws of the State of Iowa relating to the depositing,securing,holding and investing of
public funds.All interest received by the City as a result of investments under this section shall
be deposited in or trans ferred to the Sinking Fund and used solely and only for the purposes
specified herein for such fund.
Section 13.The City hereby covenants and agrees with the owner or owners of the
Bonds and any Parity Obligations,or any of them,that from time to time may be outstanding,
that it will faithfully and punctually perform all duties with reference to the Utility required and
provided by the Constitution and laws of the State of Iowa,that it will segregate the Gross
Revenues of the Utility and make application thereof in accordance with the provisions of this
resolution and that it will not sell,lease or in any manner dispose of the Utility or any part
thereof,including any and all extensions and additions that may be made thereto,until all of the
Bonds and any Parity Obligations shall have been paid in full,both principal and interest,or
unless and until provisions shall have been made for the payment of said Bonds and Parity
Obligations and interest thereon in full;provided,however,that the City may dispose of any
property which in the judgment of the City Council,or the duly constituted body as may then be
charged with the operation of the Utility,is no longer useful or profitable in the operation of the
Utility nor essential to the continued operation thereof and when the sale thereof will not operate
to reduce the revenues to be derived from the operation of the Utility.
Section 14.Upon a breach or default of a term of the Bonds or Parity Obligations and
this resolution,a proceeding may be brought in law or in equity by suit,action or mandamus to
enforce and compel performance of the duties required under the terms of this resolution and
Division V of Chapter 384 of the Code of Iowa or an action may be brought to obtain the
appointment of a receiver to take possession of and operate the Utility and to perform the duties
required by this resolution and Division V of Chapter 384 of the Code of Iowa.
Section 15.None of the Bonds or any Parity Obligations shall be entitled to priority or
preference one over the other in the application of the Net Revenues of the Utility,regardless of
the time or times of the issuance of the Bonds or any Parity Obligations,it being the intention
that there shall be no priority among the Bonds or Parity Obligations,regardless of the fact that
they may have been actually issued and delivered at different times.The City hereby covenants
and agrees that so long as any of the Bonds or any Parity Obligations are outstanding and unpaid,
no bonds or other obligations payable from the Net Revenues of the Utility will be issued except
upon the basis of such bonds or obligations being subject to the priority and security for payment
of the Bonds or any Parity Obligations then outstanding;provided,however,that the City
reserves the right and privilege of issuing Parity Obligations in order to pay the cost of
improvements and extensions to the Utility or for refunding any bonds or obligations payable
from the Net Revenues of the Utility,but only if there shall have been procured and placed on
file with the City a statement of an Independent Auditor,Independent Financial Consultant or
Consulting Engineer,not a regular employee of the City,reciting the opinion that,based upon
necessary investigations,the officially reported Net Revenues of the Utility for the last preceding
fiscal year prior to the issuance of such Parity Obligations (with adjustments as hereinafter
provided)were equal to at least 125%of the maximum amount that will become due in any
subsequent year prior to the longest maturity of any of the then outstanding Bonds and Parity
Obligations for both the principal of and interest on the Bonds and any Parity Obligations then
outstanding and the Parity Obligations then proposed to be issued.
The amount of Gross Revenues of the Utility may be adjusted for the purpose of the
foregoing computations by an Independent Auditor,Independent Financial Consultant or
Consulting Engineer,not a regular employee of the City,so as to reflect any revision in the
schedule of rates and charges being imposed at the time of the issuance of any such Parity
Obligations.
Obligations issued to refund the Bonds or any Parity Obligations shall not be subject to
the foregoing restrictions,provided the Bonds or Parity Obligations being refunded mature
within three (3)months of the date of such refunding and no other funds are available to pay
such maturing Bonds or Parity Obligations,or the issuance of the refunding obligations will not
cause an increase in the annual debt service requirements during the life of any Bonds or Parity
Obligations then outstanding which are not being refunded but otherwise any Parity Obligations
shall only be issued subject to the restrictions of this resolution.
Section 16.The City agrees that so long as the Bonds or any Parity Obligations remain
outstanding,it will maintain insurance for the benefit of the owners of the Bonds and any Parity
Obligations on the insurable portions of the Utility of a kind and in an amount which usually
would be carried by private companies or municipalities engaged in a similar type of business.
The City will keep proper books of record and account,separate from all other records and
accounts,showing the complete and correct entries of all transactions relating to the Utility,and
the owners of the Bonds or any Parity Obligations shall have the right at all reasonable times to
inspect the Utility and all records,accounts and data of the City relating thereto.
Section 17.The provisions of this resolution shall constitute a contract between the
City and the owners of the Bonds,and after the issuance of the Bonds,no change,variation or
alteration of any kind of the provisions of this resolution shall be made which will adversely
affect the owners of the Bonds until all of the Bonds and the interest thereon shall have been paid
in full,except as hereinafter provided.
The owners of a majority in principal amount of the Bonds and Parity Obligations at any
time outstanding (not including in any case any obligations which may then be held or owned by
or for the account of the City,but including such obligations as may be issued for the purpose of
refunding any of the Bonds or Parity Obligations if such obligations shall not then be owned by
the City)shall have the right from time to time to consent to and approve the adoption by the
City of a resolution or resolutions modifying or amending any of the terms or provisions
contained in this resolution;provided,however,that this resolution may not be so modified or
amended in such manner as to:
(a)Make any change in the maturity or redemption terms of the Bonds or any
Parity Obligations.
(b)Make any change in the rate of interest borne by any of the Bonds or any
Parity Obligations.
(c)Reduce the amount of the principal payable on any Bonds or any Parity
Obligations.
(d)Modify the terms of payment of principal of or interest on the Bonds or
any Parity Obligations,or any of them,or impose any conditions with respect to such
payment.
(e)Affect the rights of the owners ofless than all of the Bonds or any Parity
Obligations then outstanding.
(f)Reduce the percentage of the principal amount of the Bonds or any Parity
Obligations,the consent of the owners of which shall be required to effect a further
modification.
Whenever the City shall propose to amend or modify this resolution under the provisions
of this section,it shall (1)prior to the publication of the notice hereinafter provided for in (2),
cause notice of the proposed amendment to be mailed to each of the owners of the Bonds and
Parity Obligations at the addresses appearing on the registration books of the City and also to the
Purchaser,and (2)cause notice of the proposed amendment to be published one time in a
newspaper published and/or having a general circulation in the City of Waukee,Iowa.Such
notice shall briefly set forth the nature of the proposed amendment and shall state that a copy of
the proposed amendatory resolution is on file in the office of the City Clerk.
If the owners of at least a majority in aggregate principal amount of the Bonds and Parity
Obligations outstanding at the time of the adoption of such amendatory resolution shall have
consented to and approved the adoption thereof as herein provided,no owner of any Bonds or
Parity Obligations shall have any right or interest to object to the adoption of such amendatory
resolution or to object to any of the terms or provisions therein contained or to the operation
thereof or to enjoin or restrain the City from taking any action pursuant to the provisions thereof.
Any consent given by the owners of a Bond or Parity Obligation pursuant to the
provisions of this section shall be in-evocable for a period of six (6)months from the date of such
consent and shall be conclusive and binding upon all future owners of the same Bond or Parity
Obligation during such period.Such consent may be revoked at any time after six (6)months
from the date of such consent by the owner who gave such consent or by a successor in title,but
such revocation shall not be effective if the owners of a majority in aggregate principal amount
of the Bonds and Parity Obligations outstanding as in this section defined shall have,prior to the
attempted revocation,consented to and approved the amendatory resolution referred to in such
revocation.
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 acknowledgments of deeds within such jurisdiction,that the persons 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.
Section 18.It is the intention of the City that interest on the Bonds be and remain
excluded from gross income for federal income tax purposes pursuant to the appropriate
provisions of the Internal Revenue Code of 1986,as amended,and the Treasury Regulations in
effect with respect thereto (all of the foregoing herein referred to as the "Internal Revenue
Code").In furtherance thereof the City covenants to comply with the provisions of the Internal
Revenue Code as they may from time to time be in effect or amended and further covenants to
comply with applicable future laws,regulations,published rulings and court decisions as may be
necessary to insure that the interest on the Bonds will remain excluded from gross income for
federal income tax purposes.Any and all of the officers of the City are hereby authorized and
directed to take any and all actions as may be necessary to comply with the covenants herein
contained.
Section 19.If any section,paragraph,clause or provision of this resolution shall be
held invalid,the invalidity of such section,paragraph,clause or provision shall not affect any of
the remaining provisions ofthis resolution.
Section 20.Continuing Disclosure.The Securities and Exchange Commission (the
"SEC")has promulgated certain amendments to Rule 15c2-12 under the Securities Exchange Act
of 1934 (17 C.F.R.§240.l5c2-12)(the "Rule")that make it unlawful for an underwriter to
participate in the primary offering of municipal securities in a principal amount of $1,000,000 or
more unless,before submitting a bid or entering into a purchase contract for such securities,it
has reasonably determined that the issuer or an obligated person has undertaken in writing for the
benefit of the holders of such securities to provide certain disclosure information to prescribed
information repositories on a continuing basis so long as such securities are outstanding.
On the date of issuance and delivery of the Bonds,the City will execute and deliver a
Continuing Disclosure Certificate pursuant to which the City will undertake to comply with the
Rule.The City covenants and agrees that it will comply with and carry out the provisions of the
Continuing Disclosure Certificate.Any and all of the officers of the City are hereby authorized
and directed to take any and all actions as may be necessary to comply with the Rille and the
Continuing Disclosure Agreement..
Section 21.All resolutions and orders or parts thereof in conflict with the provisions
ofthis resolution are,to the extent of such conflict,hereby repealed.
Section 22.This resolution shall be in full force and effect irmnediately upon its
adoption and approval,as provided by law.
Passed and approved June 18,2007.
Attest:
ROLL CALL VOTE AYE NAY ABSENT
Donald L.Bailey,Jf.X
Isaiah McGee X
JeffY.Mertz X
Darlene Stanton X
Mike Watts X