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Home My WebLink AboutOrd.1737.06-23-1995 � 4 � Gilmore & Bell, P,C. K 102664\partcpts\capegir\ordnanc BILL NO. 95-�3(0 ORDINANCE NO. 1�3� OF THE CITY OF CAPE GIRARDEAU, MISSOURI �� ADOPTED JUNE 23, 1995 AUTHORIZING: CAPITAL APPRECIATION SEWERAGE SYSTEM REVENUE BONDS (STATE REVOLVING FUND PROGRAM) SERIES 1995 ----------------------------------------------- ----------------------------------------------- � , � INDEX PAGE Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE I DEFINITIONS Section 101. Definitions of Words and Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 102. Additional Provisions . . . . . . . . . . . . . . . . . . . e . . . . . . . . . . . . . . . . 7 ARTICLE II AUTHORIZATION OF BONDS Section 201. Authorization of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 � Section 202. Security for Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 7 Section 203, Description of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 204. Designation of Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 205. Method and Place of Payment of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 206. Registration, Transfer and Exchange of Bonds . . . . . . . . o . . . . . . . . . e . . . . . � . . . . . . . . . . . . . . 0 8 Section 207. Execution, Authentication and Delivery of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 208. Mutilated, Destroyed, Lost and Stolen Bonds . . . . . . . . . . . . . . . . . . . . . . 9 Section 209. Cancellation and Destruction of Bonds Upon Payment . . . o . . . . . . . . . . . . . . . . a . . . , . . e . . . . o . , . , 10 Section210. SaleoftheBonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . e , 10 Section211. OfficialStatement . . . . . . . . . . . . . . . e . , o . . . . e . . , e . , . . . . o . 0 10 Section 212. Administrative Fee and Trustee's Fee; Revolving Fund Loan . , . o . . . . . . . . . . . . . . . . o o . . . . . . . 10 ARTICLE III REDEMPTION OF BONDS Section 301. No Redemption of Bonds . . . . . . . . . . , . e . . . . . . . . . . . . . . . . . . . . 11 r (i) . . � ARTICLE IV FORMS OF BONDS Section 401. Form of Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 ARTICLE V RATIFICATION OF FUNDS AND ACCOUNTS Section 501. Ratification of Funds and Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 502. Administration of Funds and Accounts . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 503. Acknowledgment of Accounts . . . . . . . . . . . . . . . . . . . . . e . . . . . , . . 12 ARTICLE VI APPLICATION OF BOND PROCEEDS Section 601, Disposition of Bond Proceeds . . . . . . . . . e . . a . . . . . . . . . . . . . . . o . 12 Section 602. Assignment and Application of Moneys in the Construction Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 � ARTICLE VII APPLICATION OF REVENUES Section701. RevenueFund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . e . , . . ee , . 13 Section 702. Application of Moneys in Funds and Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . e . . . . 13 Section 703. Deficiency of Payments into Funds and Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Section 704. Transfer of Funds to Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 ARTICLE VIII DEPOSIT AND INVESTMENT OF MONEYS Section 801, Investment of Moneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 i"\ (ii) 1 � � ARTICLE IX PARTICULAR COVENANTS OF THE CITY Section 901. Eff'icient and Economical Operation . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 902. Rate Covenant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 903. Reasonable Charges for all Services . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 904. Annual Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 905. Annual Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 906. Performance of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 � Section 907. Tax Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 ARTICLE X ADDITIONAL BONDS Section 1001. Prior Lien Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 1002. Parity Lien Bonds or Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 1003. Junior Lien Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Section 1004. Refunding Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 ARTICLE XI r DEFAULT AND REMEDIES Section 1101. Acceleration of Maturity in Event of Default . . . . . . . . . . . . . . . . . . . . . . o . . . . . . . . . , . . . . . 20 Section1102. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 1103. Limitation on Rights of Bondowners . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 1104. Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 1105. No Obligation to Levy Taxes . . . . . . . . e . . . . . . . . . . . . . . . . . . . . . 22 ARTICLE XII DEFEASANCE Section 1201. Defeasance . o . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 ARTICLE XIII AMENDMENTS Section 1301. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 � (iii) : � ARTICLE XIV MISCELLANEOUS PROVISIONS Section 1401, Further Authority o . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 1402. Principal Amount of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 1403. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 1404. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 1405. Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Passage . . . . . o . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Signatures o . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 E�ibit A � Project Specific Information Exhibit B - Form of Bond E�ibit C - Table of Compound Accreted Values � � (iv) BILL NO. 95- ORDINANCE NO. AN ORDINANCE AUTHORIZING THE ISSUANCE OF $11,462,661.15 PRINCIPAL AMOUNT OF CAPITAL APPRECIATION SEWERAGE SYSTEM REVENUE BONDS (STATE REVOLVING FUND PROGRAM) SERIES 1995, OF THE CITY OF CAPE GIRARDEAU, MISSOURI, FOR THE PURPOSE OF EXTENDING AND IMPROVING THE CITY'S SEWERAGE SYSTEM; PRESCRIBING THE FORM AND DETAILS OF SAID BONDS AND THE COVENANTS AND AGREEMENTS MADE BY THE CITY TO FACILITATE AND PROTECT THE PAYMENT THEREOF; PROVIDING FOR THE COLLECTION, SEGREGATION AND APPLICATION OF THE REVENUES OF THE SEWERAGE SYSTEM OF THE CITY FOR THE PURPOSE OF PAYING THE COST OF OPERATION AND MAINTENANCE OF SAID SYSTEM, PAYING THE PRINCIPAL OF AND INTEREST ON SAID BONDS, AND PROVIDING REASONABLE AND ADEQUATE RESERVE FUNDS;AND AUTHORIZING A NON-INTEREST BEARING LOAN FROM THE WATER AND WASTEWATER LOAN FUND OF THE STATE OF MISSOURI AND PRESCRIBING OTHER MATTERS RELATING THERETO. WHEREAS, the City of Cape Girardeau, Missouri (the "City"), is a municipal corporation and constitutional charter city operating under a home rule form of government, organized and existing under the Constitution and laws of the State of Missouri; and WHEREAS, the City now owns and operates an entire sewerage plant and system for the collection, treatment and disposal of sewage, to serve the needs of the City and its inhabitants and others, including all appurtenances and facilities connected therewith or relating thereto, together with all extensions, improvements, additions and enlargements thereto hereafter made or acquired by the City revenue producing sewerage system serving the City and its inhabitants (the "System"); and WHEREAS, the City desires to make extensions and improvements to the System to be financed in whole or in part by the issuance, pursuant to this Ordinance, of its Capital Appreciation Sewerage System Revenue Bonds (State Revolving Fund Program) Series 1995 (the "Bonds") in the original principal amount of$11,462,661.15 (the "Original Principal Amount"); and WHEREAS, in order to provide for the most cost effective financing of such extensions and improvements the City desires to participate in the Missouri Leveraged State Water Pollution Control Revolving Fund Program (the "SRF Program") of the Department of Natural Resources ("DNR") and the State Environmental Improvement and Energy Resources Authority (the "Authority"); and WHEREAS, the City is authorized under the provisions of Chapter 250 of the Revised Statutes of Missouri (the "Act"), to issue and sell revenue bonds for the purpose of paying all or part of the cost _ of extending and improving the System, provided that the cost of operation and maintenance thereof and the principal of and interest on such revenue bonds shall be payable solely from the income and revenues derived by the City from the operation of the System (the "Revenues"); and WHEREAS, pursuant to the authority of the Act, an election was duly held in the City on April 5, 1994, for the purpose of submitting to the qualified electors of the City the following question: OUESTION Shall The City of Cape Girardeau, Missouri, issue its sewerage system revenue bonds in an amount up to $25,000,000 for the purpose of acquiring, constructing, extending and improving its sewerage system, the cost of operation and maintenance of said system and the principal of and interest on said revenue bonds to be payable from the revenues derived by the City from the operation of its Sewerage System, including all future extensions and improvements thereto, and/or from capital improvements sales tax revenues appropriated for such purpose? and it was found and determined that more than a majority of the qualified electors of the City voting on the question had voted in favor of the issuance of said revenue bonds for the purpose aforesaid, the vote on said question having been 6,343 votes for said question to 2,871 votes against said question; and WHEREAS, the Council (the "Governing Body")of the City has caused plans and specifications for said extensions and improvements and an estimate of the cost thereof to be made by the City's Consulting Engineer (as herein defined) and the same are hereby accepted and approved and are on file in the office of the City Clerk, the amount of said estimated cost being not less than $11,600,000; and WHEREAS, none of the bonds so authorized have heretofore been issued and the City hereby finds and determines that, in order to provide funds for said purpose, it is necessary and advisable and in the best interest of the City and of its inhabitants to issue$11,462,661.15 of the bonds so authorized, and to provide the remainder of said estimated costs which may be required from subsequent issues of bonds or funds of the City otherwise available; and WHEREAS, the City has issued its Sewerage System Revenue Bonds (State Revolving Fund Program) Series 1991 (the "Series 1991 Bonds"), dated December 1, 1991, in the original principal amount of $2,500,000, of which $2,435,000 remains outstanding as of the date of adoption of this Ordinance, authorized by Ordinance No. 1122 passed on December 16, 1991 (the "Series 1991 Bond Ordinance"); and WHEREAS, the City has issued its Sewerage System Revenue Bonds (State Revolving Fund Program) Series 1993A (the "Series 1993A Bonds"), dated August 1, 1993, in the original principal amount of $500,000, of which $500,000 remains outstanding as of the date of adoption of this Ordinance, authorized by Ordinance No. 1402 passed on August 25, 1993 (the "Series 1993A Bond Ordinance"; and WHEREAS, the City has issued its Sewerage System Refunding Revenue Bonds, Series 1993 (the "Series 1993B Bonds", the Series 1991 Bonds, the Series 1993A Bonds and the Series 1993B Bonds collectively the "Outstanding Senior Bonds"), datetl September 1, 1993, in the original principal amount of$1,320,000, of which $1,225,000 remains outstanding as of the date of adoption of this Ordinance, authorized by Ordinance No. 1411 adopted on September 8, 1993 (the "Series 1993B Bond Ordinance", the Series 1991 Bond Ordinance, the Series 1993A Bond Ordinance and the Series 1993B Bond Ordinance collectively the "Outstanding Senior Bond Ordinance"); and WHEREAS, the City does not have outstanding any other bonds or other obligations payable from the Revenues save and except the Outstanding Senior Bonds; and WHEREAS, under the provisions of the Outstanding Senior Bond Ordinance, the City may issue additional bonds payable out of the Revenues which are junior and subordinate to the Outstanding Senior Bonds, and it is hereby found and determined that it is necessary and advisable and in the best interest of the City and of its inhabitants that sewerage system revenue bonds be issued and secured in the form and manner as hereinafter provided to provide funds for such purposes and be sold to the Authority under the SRF Program, subject to the conditions of the Outstanding Senior Bond Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF CAPE GIRARDEAU, MISSOURI, AS FOLLOWS: ARTICLE I DEFINITIONS � Section 101. Definitions of Words and Terms. Words and terms not otherwise defined herein shall have the meanings as set forth in the hereinafter described Indenture and Purchase Agreement. In addition to the foregoing and words and terms defined elsewhere in ttiis Ordinance, the following capitalized words and terms as used in this Ordinance shall have the following meanings: "Act" means Chapter 250, RSMo. "Administrative Fee" means the fee payable to the Trustee for transfer to DNR as described in Section 212 hereof. "Authority" means the State Environmental Improvement and Energy Resources Authority, a body corporate and politic and a governmental instrumentality of the State. "Authority Bonds" means the Water Pollution Control Revenue Bonds (State Revolving Fund Program - Cape Girardeau Project) Series 1995D of the Authority. "Authorized Denominations" means, for the Bonds of each maturity, the Original Principal Amount for each maturity as set forth in Exhibit C of this Ordinance, and integral multiples thereof. "Authorized Representative" means the representative of the City designated as such by the City in accordance with the Regulations. "Bondowner" means the Authority or its assigns. "Bond Register" means the books for the registration, transfer and exchange of Bonds kept at the off'ice of the Paying Agent. -3- "Compound Accreted Value" means, with respect to any Bond on any date of calculation, the Original Principal Amount of such Bond plus interest accrued and compounded from the date of such Bond to the date of calculation, as follows: (1) if the date of calculation is a Compounding Date, the Compound Accreted Value shall be the amount shown on Exhibit C attached hereto; and (2) if the date of calculation is any date other than a Compounding Date, the Compound Accreted Value shall be: CAV, + [(CAVZ - CAVI) x D/180] where: CAV, = the Compound Accreted Value of such Bond as of the Compounding Date next preceding the date of calculation, as shown on E�chibit C CAVz = the Compound Accreted Value of such Bond as of the Compounding Date next succeeding the date of calculation, as shown on Exhibit C D = the number of days from the Compounding Date next precetling the date of calculation, to the date of calculation, using a 360-day year of twelve 30-day months. "Consulting Engineer" shall mean each independent engineer or engineering firm or corporation of reputation for skill and experience with respect to the design and construction of wastewater treatment, sanitary sewerage or water pollution control facilities as may from time to time be retained by the City. "Current Expenses" means all reasonable and necessary expenses of operation, maintenance and repair of the System and keeping the System in good repair and working order, including without limiting the generality of the foregoing, current maintenance charges, expenses of reasonable upkeep and repairs, salaries, wages, costs of materials and supplies, Paying Agent fees and expenses, annual audits, periodic Consulting Engineer's reports, properly allocated shaze of charges for insurance, and all other expenses incident to the operation of the System, but shall exclude interest paid on System Revenue Bonds, depreciation and amortization charges, all general administrative expenses of the City not related to the operation of the System, and the payments into the Depreciation and Replacement Account hereinafter provided for, all as determined in accordance with generally accepted accounting principles. "Defeasance Securities" shall mean (i) Federal Securities, (ii) obligations of the Resolution Funding Corporation or any successor thereto, but only if the use of such obligations to pay and discharge Bonds pursuant to Article XII hereof will cause such Bonds to be rated in the highest long-term rating category by the Rating Agency, or (iii) any bonds or any other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and (A) which are fully secured as to principal and interest by a fund consisting only of cash or Federal Securities, -4- which fund may be applied only to the payment of such principal of and interest on and prior to the maturity date or dates pursuant to such irrevocable instructions, as appropriate, and (B) which fund is sufficient, as verified by a nationally recognized independent certified public accountant,to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this paragraph on the maturity date or dates thereof. "Depreciation and Replacement Account" means the fund by that name created or ratified and confirmed by Section 501 of this Ordinance. "DNR" means the Department of Natural Resources, a department of the State. "Federal Securities" means any direct obligation of, or obligation the timely payment of the principal of and interest on which are unconditionally guaranteed by, the United States of America and backed by the full faith and credit thereof. "Indenture" means the Bond Indenture dated as of June 1, 1995 between the Authority and the Trustee pursuant to which the Authority Bonds are issued. "Maturity Amount" means the Compound Accreted Value of the Bonds at maturity. "Net Revenues Available for Debt Service" means, for the period of deterFnination, all income - and revenues derived by the City from the operation of the System, including investment and rental income, net proceeds from business interruption insurance, sales tax revenues which have been annually appropriated by the City or which are limited solely to the payment of improvements to or expenses of the System and any amounts deposited in escrow in connection with the acquisition, construction, remodeling, renovation and equipping of facilities to be applietl during the period of determination to pay interest on System Revenue Bonds, less all Current Expenses (other than interest paid on System Revenue Bonds and depreciation and amortization charges during the period of determination)and other proper charges, all as determined in accordance with generally accepted accounting principles, but excluding any profits or losses on the early extinguishment of debt or on the sale or other disposition, not in the ordinary course of business, of investments or fixed or capital assets. "Ordinance" means this Ordinance as from time to time amended in accordance with the terms hereof. "Original Principal Amount" shall mean for each maturity the original principal amount which, including interest accrued at the interest rate thereon, compounded on each Compounding Date, shall be equal to the Maturity Amount, as set forth in Exhibit C to this Ordinance. "Outstanding" when used with respect to Bonds means, as of the date of determination, all Bonds theretofore issued and delivered under this Ordinance, except: (1) Bonds theretofore cancelled by the Paying Agent or delivered to the Paying Agent for cancellation; (2) Bonds for whose payment money in the necessary amount has been theretofore deposited with the Paying Agent in trust for the Owners of such Bonds; -5- (3) Bonds in exchange for or in lieu of which other Bonds have been registered and delivered pursuant to this Ordinance; (4) Bonds alleged to have been mutilated, destroyed, lost, or stolen which have been paid as provided in Section 208 hereof; and (5) Bonds for the payment of the principal of and interest on which money or Defeasance Securities or both are held by the Paying Agent or other bank or trust company with the effect specified in Section 1201 hereof. "Owner" or "Registered Owner" means the same as the term Bondowner. "Parity Bonds" means any parity bonds hereafter issued pursuant to Section 1002 hereof and standing on a parity and equality with the Bonds with respect to the payment of principal and interest out of the Revenues of the System. "Parity Ordinances" means the ordinances under which any Parity Bonds shall hereafter be issued pursuant to Section 1002 hereof. "Payment Date" means the date on which the Compound Accreted Value or Maturity Amount of any Bond is payable, which date shall be a maturity date, whether scheduled or t�pon acceleration. "Principal" or "principal" shall mean the Original Principal Amount of each Bond or the aggregate of the Original Principal Amount of the Bonds then Outstanding, uniess the context clearly requires otherwise. "Purchase Agreement" means the Purchase Agreement dated as of June 1, 1995, by and between the City and the Authority and DNR. "Record Date" for the Compound Accreted Value payable on any Payment Date means the 15th day (whether or not a Business Day) of the calendar month next preceding such Payment Date. "Revolving Fund Agreement" means the Revolving Fund Agreement dated as of June 1, 1995, by and between the City and the Authority and DNR. "SRF Program Bonds" means the Bonds and any other Parity Bonds of the City issued in connection with the City's participation in the SRF Program. "SRF Subsidy" means the amount of investment earnings which will accrue on the Reserve Account during each Fiscal Year (taking into account scheduled transfers from the Reserve Account which will occur upon the payment of principal on the Authority Bonds), provided the Reserve Security is equal to the Reserve Percentage of the principal amount of the SRF Program Bonds outstanding, the Reserve Account is invested in an investment agreement at a fixed interest rate during the calculation period and such earnings are reduced by the Administrative Fee payable to DNR. Capitalized terms in this definition shall have the respective meanings as set forth in the bond indentures pursuant to which the applicable SRF Program Bonds have been issued. "State" means the State of Missouri. -6- "System Revenue Bonds" means collectively the Bonds, the Parity Bonds and all other revenue bonds which are payable out of, or secured by an interest in, the income and revenues derived by the City from the operation of the System. "Trustee" means the trustee acting at any time as Trustee under the Indenture. Section 102. Additional Provisions. Additional provisions aze set forth in Exhibit A attached hereto and incorporated herein by this reference. ARTICLE II AUTHORIZATION OF BONDS Section 201. Authorization of Bonds. There is hereby authorized and directed to be issued the Bonds of the City in the Original Principal Amount for the purpose of extending and improving the System, as provided in this Ordinance. Section 202. Security for Bonds. The Bonds shall be special obligations of the City payable solely from, and secured as to the payment of principal and interest by a pledge of, the net revenues derived by the City from the operation of the System, and the taxing power of the�City is not pledged to the payment of the Bonds either as to principal or interest. The Bonds shall not be or constitute a general obligation of the City, nor shall they constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision, limitation or restriction. � The Bonds shall be junior and subordinate with respect to payment of principal and interest from the Revenues derived by the City from the operation of the System and in all other respects to the Outstanding Senior Bonds and, in the event of any default in the payment of either principal of or interest on any of the Outstanding Senior Bonds, all of the Revenues of the System, including all extensions and improvements thereof, will be applied solely to the payment of the principal of and interest on the Outstanding Senior Bonds until such default is cured. Section 203. DescriQtion of Bonds. 'The Bonds shall consist of fully registered bonds without coupons and issued in Authorized Denominations. The Bonds shall be numbered from 1 consecutively upward, with the number on each Bond preceded by the letters "CR". The Bonds shall be substantially in the form set forth in Section 401 hereof, and shall be subject to registration, transfer and exchange as provided in Section 206 hereof. The Bonds shall become due on the dates and in the Maturity Amounts as set forth in E�chibit A. The Original Principal Amounts of the Bonds shall bear interest(computed on the basis of a 360- day year of twelve 30-day months) from the dated date thereof (which shall be the date of original delivery of and payment for the Bonds), compounded semiannually on each Compounding Date to the Compound Accreted Values shown on E�chibit C attached hereto, payable only at stated maturity or upon acceleration of maturity. Section 204. Desi�nation of Paying A�. The Trustee is hereby designated as the City's paying agent for the payment of principal of and interest on the Bonds and bond registrar with respect -7- to the registration, transfer and exchange of Bonds (herein called the "Paying Agent"). The Paying Agent shall not be paid any additional fees for its services in connection herewith. Section 205. Method and Place of Pavment of Bonds. The principal of and interest on the Bonds shall be payable in any coin or currency which, on the respective dates of payment thereof, is legal tender for the payment of debts due the United States of America. The Compound Accreted Value of each Bond shall be paid at maturity, whether scheduled or upon acceleration, to the person in whose name such Bond is registered at the maturity date thereof, upon presentation and surrender of such Bond at the principal o�ce of the Paying Agent. . The Paying Agent shall keep in its office a record of payment of principal of and interest on all Bonds and shall at least annually, at the request of the City, forward a copy or summary of such records to the City. Section 206. Registration, Transfer and Exchange of Bonds. The City covenants that it will, as long as any of the Bonds remain Outstanding, cause to be kept at the office of the Paying Agent books for the registration, transfer and exchange of Bonds as herein provided (the "Bond Register"). Each Bond when issued shall be registered in the name of the Owner thereof on the Bond Register kept by the Paying Agent. Bonds may be transferred and exchanged only upon the Bond Register maintainesi by the Paying Agent as provided in this Section. Upon surrender thereof at the principal office of the Paying Agent, the Paying Agent shall transfer or exchange any Bond for a new Bond or Bonds in any authorized denomination of the same maturity and in the same aggregate Original Principal Amount as the Bond which was presented for transfer or exchange. All Bonds presented for transfer or exchange shall be accompanied by a written instrument or instruments of transfer or authorization for exchange, in a form and with guarantee of signature satisfactory to the Paying Agent, duly executed by the Registered Owner thereof or by the Registered Owner's duly authorized agent. All Bonds presented for transfer or exchange shall be surrendered to the Paying Agent for cancellation. For every such exchange or transfer of Bonds, whether temporary or definitive, the City or the Paying Agent may make a charge su�cient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer, which sum or sums shall be paid by the person requesting such exchange or transfer as a condition precedent to the exercise of the privilege of making such exchange or transfer. In all cases in which the privilege of transferring or exchanging Bonds is exercised, the Paying Agent shall authenticate and deliver Bonds in accordance with the provisions of this Ordinance. The City and the Paying Agent may deem and treat the person in whose name any Bond shall be registered as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on said Bond and for all other purposes, and all such payments so made to any such Registered Owner or upon the Registered Owner's order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the -8- extent of the sum or sums so paid, and neither the City nor the Paying Agent shall be affected by any notice to the contrary, but such registration may be changed as herein provided. At reasonable times and under reasonable regulations established by the Paying Agent, the Bond Register may be inspected and copied by the Owners (or a designated representative thereo� of 25% or more in Compound Accreted Value of the Bonds then Outstanding or any such designated representative to be evidenced to the satisfaction of the Paying Agent. Section 207. Execution, Authentication and Delivery of Bonds. Each of the Bonds, including any Bond issued in exchange or as substitution for the Bonds initially delivered, shall be signed by the manual or facsimile signature of the Mayor, attested by the manual or facsimile signature of the City Clerk, and shall have the off'icial seal of the City affixed thereto or imprinted thereon. In case any o�cer whose signature or facsimile thereof appears on any Bonds shall cease to be such officer before the delivery of such Bonds, such signature or facsimile thereof shall nevertheless be valid and sufficient for all purposes, the same as if such person had remained in o�ce until delivery. Any Bond may be signed by such persons who at the actual time of the execution of such Bond shall be the proper off'icers to sign such Bond although at the date of such Bond such persons may not have been such off'icers. The Mayor and the City Clerk are hereby authorized and directed to prepare and execute the Bonds as hereinbefore specified, and when duly executed, to deliver the Bonds to the Paying Agent for authentication. Upon authentication, the Paying Agent shall deliver the Bonds to the Bondowner,upon payment of the purchase price thereof. . The Bonds shall have endorsed thereon a certificate of authentication substantially in the form set forth in Section 401 hereof, which shall be manually executed by the Paying Agent. No Bond shall be entitled to any security or benefit under this Ordinance or be valid or obligatory for any purpose unless and until such certificate of authentication shall have been duly executed by the Paying Agent. Such executed certificate of authentication upon any Bond shall be conclusive evidence that such Bond has been duly authenticatetl and delivered under this Ordinance. The certificate of authentication on any Bond shall be deemed to have been duly executed if signed by any authorized officer or employee of the Paying Agent, but it shall not be necessary that the same off'icer or employee sign the certificate of authentication on all of the Bonds that may be issued hereunder at any one time. Section 208. Mutilated, Destroved, Lost and Stolen Bonds. If (i) any mutilated Bond is surrendered to the Paying Agent, or the City and the Paying Agent receive evidence to their satisfaction of the mutilation, destruction, loss or theft of any Bond, and (ii) there is delivered to the City and the Paying Agent such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the City or the Paying Agent that such Bond has been acquired by a bona fide purchaser, the City shall execute and upon its request the Paying Agent shall register and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Bond, a new Bond of the same maturity and of like tenor and Original Principal Amount, bearing a number not contemporaneously outstanding. In case any such mutilated, destroyed, lost or stolen Bond has become or is about to become due and payable, the City in its discretion may, instead of issuing a new Bond, pay such Bond. Upon the issuance of any new Bond under this Section, the City may require the payment by the Owner of a sum sufficient to cover any t� or other governmental charge that may be imposed in -9- � relation thereto and any other expenses (including the fees and expenses of the Paying Agent)connected therewith. Every new Bond issued pursuant to this Section in lieu of any mutilated, destroyed, lost or stolen Bond shall constitute a replacement of the prior obligation of the City, whether or not the mutilated, destroyed, lost or stolen Bond shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and ratably with all other Outstanding Bonds. Section 209. Cancellation and Destruction of Bonds Upon Pavment. All Bonds which have been paid or redeemed or which have otherwise been surrendered to the Paying Agent, either at or before maturity, shall be cancelled immediately upon the payment of such Bonds and the surrender thereof to the Paying Agent and periodically destroyed by the Paying Agent. The Paying Agent shall execute a certificate in duplicate describing the Bonds so cancelled and destroyed, and shall file an executed counterpart of such certificate with the City. Section 210. Sale of the Bonds. The sale of the Bonds to the Bondowner at a purchase price of 100% of the Original Principal Amount of the Bonds is hereby ratified and confirmed. In connection with the participation by the City in the SRF Program, the City Manager is hereby authorized to enter into the Purchase Agreement, the Revolving Fund Agreement and the Terms Certificate of the City in substantially the forms on file with the City Clerk, with such changes therein as shall be approved by the Mayor, which officer is hereby authorized to execute such document for and orr behalf of the City, and such officer's signature thereon shall be conclusive evidence of his or her approval thereof. Section 211. Official Statement. The City hereby ratifies and confirms the information in the Preliminary Off'icial Statement prepared in the initial offering and sale of the Authority Bonds, in the form presented at this meeting, with respect to the City in Appendix B thereto and hereby approves the form and content of any addenda, supplement, or amendment thereto, and authorizes and approves information in the final Off'icial Statement by supplementing, completing and amending the Preliminary Official Statement and the City Manager is hereby authorized to execute said portion of Appendix B to the O�cial Statement. The use of such Official Statement in the reoffering of the Authority Bonds by the Authority is hereby approved and authorized. The proper officials of the City are hereby authorized to execute and deliver a certificate pertaining to such Off'icial Statement as prescribed therein, dated as of the date of payment for and delivery of the Bonds. Section 212. Administrative Fee and Trustee's Fee; Revolvin� Fund Loan. (a) Subject to the provisions of Section 202 hereof, the City shall pay to the Trustee (i) for deposit in the Administrative Expense Fund, for transfer to DNR, no later than the fifteenth day following each Administrative Fee Calculation Date as set forth in Exhibit A an amount equal to 0.714% of the outstanding principal amount of the Revolving Fund Loan on the Administrative Fee Calculation Date (the "Administrative Fee"), and (ii) for deposit in the Administrative Expense Fund, for payment to the Trustee, an amount equal to the Public Entity's Allocable Portion of the Trustee's Fee. (b) The City is hereby authorized to receive a loan (the "Revolving Fund Loan") from the Wastewater Loan Fund. The Revolving Fund Loan shall be made in the amounts and at the times and shall be repayable on the dates and in the amounts as set forth in the Revolving Fund Agreement. The Revolving Fund Loan shall not bear interest. The City hereby assigns the proceeds of the Revolving -10- Fund Loan, as and when the installments thereof are received, to the Authority, which proceeds shall be held in the Reserve Account. ARTICLE III REDEMPTION OF BONDS Section 301. No Redem�tion of Bonds. The Bonds are not subject to redemption prior to the maturity thereof. ARTICLE IV FORM OF BONDS Section 401. Form of Bonds. Each of the Bonds, as originally issued or issued upon transfer, exchange or substitution, shall be in substantially the form as set forth in Exhibit B hereto. ARTICLE V � RATIFICATION OF FUNDS AND ACCOUNTS Section 501. Ratification of Funds and Accounts. The separate funds and accounts created in, or ratified and confirmed by, the Outstanding Senior Bond Ordinance known respectively as the: (a) Sewerage System Revenue Fund (herein referred to as the "Revenue Fund"); (b) Sewerage System Operation and Maintenance Fund (herein referred to as the "Operation and Maintenance Account"); (c) Sewerage System Depreciation and Replacement Fund (herein referred to as the "Depreciation and Replacement Account"); (d) Sewerage System Surplus Fund (herein referred to as the "Surplus Account"); (e) Interest Account, Principal Account and Debt Service Account under the Series 1991 Ordinance; Interest Account, Principal Account and Debt Service Account held under the Series 1993 Ordinance; and Debt Service Account for Sewerage System Refunding Revenue Bonds, Series 1993 held under the Series 1993B Ordinance(collectively referred to herein as the "Outstanding Senior Bond Debt Service Account"); and (� Reserve Account held under the Series 1991 Ordinance; Reserve Account held under the Series 1993 Ordinance; and Debt Service Reserve Account for Sewerage System Refunding Revenue Bonds, Series 1993 held under the Series 1993B Ordinance (collectively referred to herein as the "Outstanding Senior Bond Debt Service Reserve Account") -11- are hereby ratified and confirmed. Section 502. Administration of Funds and Accounts. The funds and accounts described in paragraphs (a)through(fl of Section 501 shall be maintained and administered by the City as hereinafter provided so long as any of the Bonds and the Outstanding Senior Bonds remain Outstanding and unpaid; provided, however, that the funds or accounts referred to in subparagraphs (e) and (fl of Section 501 will be maintained and administered by the City so long as any of the Outstanding Senior Bonds remain Outstanding and unpaid. Section 503. Acknowledgment of Accounts. The City acknowledges the creation of the following accounts for the City and held by the Trustee under the Indenture: (a) Construction Loan Fund; (b) Reserve Account; (c) Accrual Account; (d) Debt Service Fund; (e) Principal Account; and (� Interest Account. The City further acknowledges that certain amounts will be transferred to the Costs of Issuance Fund and the Administrative Expense Fund under the Indenture in satisfaction of eeRain obligations of the City under this Ordinance, the Purchase Agreement and the Revolving Fund Agreement. ARTICLE VI APPLICATION OF BOND PROCEEDS Section 601. Disposition of Bond Proceeds. The net proceetls received from the sale of the Bonds, including any premium or accrued interest thereon, and other moneys provided by the City shall be deposited simultaneously with the delivery of the Bonds, as follows: (a) There shall be deposited in the Costs of Issuance Fund an amount equal to the Costs of Issuance as set forth in Exhibit A. (b) There shall be deposited in the Interest Account the accrued interest on the Bonds; and (c) There shall be deposited in the Construction Account the remaining proceeds of the Bonds. Section 602. Assi�nment and Application of Moneys in the Construction Account. (a) The City hereby assigns the proceeds of the Bonds held in the Construction Account to the Authority to secure the City's obligations under this Ordinance. Moneys in the Construction Account shall be disbursed to the City for the sole purpose of paying the cost of extending and improving the System as hereinbefore provided, in accordance with the plans and specifications therefor prepared by the Consulting Engineer, heretofore approved by the Governing Body of the City and on file in the office of the City Clerk, including any alterations in or amendments to said plans and specifications deemed -12- advisable by the Consulting Engineer and approved by the Governing Body of the City, and for paying the costs and expenses incident to the issuance of the Bonds. (b) Requisitions shall be submitted for withdrawals from the Construction Account in accordance with Article III of the Purchase Agreement, and accompanied by a certificate executed by the Authorized Representative that such payment is being made for a purpose within the scope of this Ordinance and that the amount of such payment represents only the contract price of the property, equipment, labor, materials or service being paid for or, if such payment is not being made pursuant to an express contract, that such payment is not in excess of the reasonable value thereof. ARTICLE VII APPLICATION OF REVENUES Section 701. Revenue Fund. The City covenants and agrees that from and after the delivery of the Bonds, and continuing as long as any of the Bonds remain Outstanding hereunder, all of the Revenues derived and collected by the City from the operation of the System shall be paid and deposited into the Revenue Fund as and when received. Said Revenues shall be segregated and kept separate and apart from all other moneys, revenues, funds and accounts of the City and shall not be commingled with any other moneys, revenues, funds and accounts of the City. The Revenue Fund.ahall be administered and applied solely for the purposes and in the manner provided in the Outstanding Senior Bond Ordinance and this Ordinance. Section 702. Annlication of Monevs in Funds and Accounts. 'I'he City covenants and agrees that from and after the delivery of the Bonds and continuing so long as any of the Bonds shall remain Outstanding, the City will administer and allocate all of the moneys then held in the Revenue Fund on the dates and in the amounts as follows: (a) (1) There shall first be paid and credited on the first day of each month to the Operation and Maintenance Account an amount su�cient to pay the estimated cost of operating and maintaining the System during the ensuing 30-day period. All amounts paid and credited to the Operation and Maintenance Account shall be expended and used by the City solely for the purpose of paying the Current Expenses of the System. (2) There shall next be paid and credited on the first day of each month to the Outstanding Senior Bond Debt Service Account and the Outstanding Senior Bond Reserve Account the amounts required pursuant to the Outstanding Senior Bond Ordinance. (b) (1) There shall next be paid and credited on the 25th day of each month (or the next succeeding Business Day if such day is not a Business Day) to the Trustee for credit to the Interest Account and the Principal Account, to the extent necessary to pay the interest on and principal of the Bonds when due, the following sums: (A) Beginning on January 25, 1997 and continuing thereafter on each monthly payment date so long as any of the Bonds shall remain outstanding and unpaid, to the Interest Account an amount not less than 1/12 of the Compound Accreted Value that will become due on the Bonds on the next succeeding Payment Date less the Original -13- Principal Amount due on such Payment Date; payments to the Interest Account shall be reduced as follows: (i) an amount equal to the moneys remaining in the Debt Service Account after the payment of the principal of and interest due on the Authority Bonds on an Interest Payment Date shall be credited against the next succeeding monthly payment or payments; and (ii) upon the City's receipt of the Trustee's annual notice of the anticipated balance of the Accrual Account and the Accrual Account Withdrawal as of the next succeeding Payment Date and semiannual notice of actual investment earnings in the Principal Account and the Interest Account for the prior Interest Period, an amount equal to such Accrual Account Withdrawal and actual eaznings shall be credited against the monthly payments due on and prior to the next Payment Date on a pro rata basis; and (B) Beginning on January 25, 1997 and continuing thereafter on each monthly payment date so long as any of the Bonds shall remain outstanding and unpaid, to the Principal Account an amount not less than 1/12 of the Original Principal Amount that will become due on the next succeeding Payment Date. (2) The completion of construction of the Project shall be evidenced to the Authority, the Trustee and DNR by a certificate signed by the Authorized Representative of the City stating (i) that the construction of the Project has been completed in accordance with the plans and specifications therefor, (ii) that all costs and expenses incurred in the construction of the Project have been paid except costs and expenses the payment of which is not yet due nr is being retained or contested in good faith by the City and (iii) the Initiation of Operations. (3) The provisions of this subparagraph (3) shall be applicable in the event that the Initiation of Operation occurs prior to the expected date for the Initiation of Operation set forth on the City's signature page to the Purchase Agreement. Notwithstanding the above provisions of subparagraph (1) of this paragraph (a) with respect to the payment of installments of principal, the first monthly installment of principal shall be paid and credited to the Trustee no later than the first day of the month which is not more than 12 months after the Initiation of Operation. On the first day of the month which is not more than 20 years after the Initiation of Operation, all remaining unpaid Original Principal Amount of the Bonds shall be paid and credited to the Trustee. (4) There shall next be paid to the Trustee for deposit to the Administrative Expense Fund, on each Interest Payment Date that the Allocable PoRion of the Trustee's Fee and the Administrative Fee are scheduled to become due, such amounts as may be required to pay the Allocable Portion of the Trustee's Fee and the Administrative Fee becoming due on such date. If at any time the moneys in the Revenue Fund shall be insuff'icient to make in full the payments and credits at the time required to be made by the City to the Interest Account and the Principal Account and to the Outstanding Senior Debt Service Account, the available moneys in the Revenue Fund shall be applieri first to the Outstanding Senior Bond Debt Service Account and the balance, if any, in the Revenue Fund shall then be applied to the payment of debt service on the Bonds. (c) After all payments and credits required at the time to be made under the provisions of paragraphs (a) and (b) of this Section have been made, there shall next be paid and credited on the first day of each month, in the event the Trustee has withdrawn moneys from the Reserve Account (other than investment earnings or the amount transferred from the Reserve Account upon the payment of -14- principal on the Bonds), beginning with the first day of each month after such withdrawal, and continuing on the first day of each month thereafter (to and including the sixth such month), there shall next be paid to the Trustee for credit to the Reserve Account an equal pro rata portion of the amount withdrawn from the Reserve Account. If at any time the moneys in the Revenue Fund shall be insufficient to make in full the payments and credits at the time required to be made to the Reserve Account and to the reserve funds established for the Outstanding Senior Bond and any other outstanding Parity Bonds, the available moneys in the Revenue Fund shall be applied first to the Outstanding Senior Bond Debt Service Reserve Account and the balance, if any, in the Revenue Fund shall then be divided among the Reserve Account and such other reserve accounts in proportion to the respective principal amounts of said series of bonds at the time outstanding which are payable from the moneys in such accounts. (d) After all payments and credits required at the time to be made by the City under the provisions of paragraphs (a), (b) and (c) of this Section have been made, all moneys remaining in the Revenue Fund on each monthly payment date shall be paid and credited to the Surplus Account. Moneys in the Surplus Account may be expended and used for the following purposes as determined by the Governing Body of the City: (1) Paying the cost of the operation, maintenance and repair of the System to the extent that may be necessary after the application of the moneys held in �the Operation and Maintenance Account under the provisions of paragraph (a)(1) of this Section.and preventing default in the amounts referred to in paragraph (a)(2) of this Section; (2) Paying the cost of extending, enlarging or improving the System; (3) Preventing default in, anticipating payments into or increasing the amounts in the accounts confirmed in Section 502 hereof, the Principal Account, the Interest Account, the Reserve Account or the Depreciation and Replacement Account referred to in paragraphs (b)and (c) of this Section, or any one of them, or establishing or increasing the amount of any principal and interest account or bond reserve account created by the City for the payment of any Parity Bonds of the City hereafter issued; or (4) At the option of the City, purchasing in the open market at the best price obtainable not exceeding the call price (if any bonds are callable), the Bonds or any other Parity Bonds of the City hereafter issued under the conditions hereinafter specified and standing on a parity with the Bonds, including principal and interest. So long as any of the Bonds remain Outstanding, no moneys derived by the City from the operation of the System shall be diverted to the general governmental or municipal functions of the City. Section 703. Deficiency of Pavments into Funds and Accounts. If at any time the revenues derived by the City from the operation of the System shall be insufficient to make any payment on the date or dates hereinbefore specified, the City will make good the amount of such deficiency by making additional payments or credits out of the first available revenues thereafter received by the City from the operation of the System, such payments and credits being made and applied in the order hereinbefore specified in Section 702 of this Ordinance. -15- If at any time the moneys in the Outstanding Senior Bond Debt Service Account, the Outstanding Senior Bond Debt Service Reserve Account, the Principal Account, the Interest Account or the Reserve Account are not sufficient to pay the principal of and interest on the Bonds and the Outstanding Senior Bonds as and when the same become due, then moneys in the Surplus Account and the Depreciation and Replacement Account may and shall be used by the City, in that order, to prevent any default in the payment of the principal of and interest on the Outstanding Senior Bonds first and then the principal of and interest on the Bonds. Section 704. Transfer of Funds to Payin�Agent. T'he chief financial officer of the City is hereby authorized and directed to make the payments to the Principal Account, the Interest Account and the debt service accounts as provided in Section 702 hereof, and, to the extent necessary to prevent a default in the payment of either principal of or interest on the System Revenue Bonds, from the debt service reserve accounts, the Surplus Account and the Depreciation and Replacement Account as provided in Sections 702 and 703 hereof, sums sufficient to pay the principal of and interest on the System Revenue Bonds as and when the same become due, and to forward such sums to the Paying Agent in a manner which ensures the Paying Agent will have available funds in such amounts on or before the second Business Day immediately preceding the dates when such principal and interest will become due. Upon the payment in full of all principal of and interest on the Bonds, it shall be the duty of the Paying Agent forthwith to return any excess funds to the City. All moneys deposited with the Paying Agent shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance. � ARTICLE VIII � DEPOSIT AND INVESTMENT OF MONEYS Section 801. Investment of Monevs. Moneys held in the Interest Account, the Principal Account, the Construction Loan Fund, the Debt Service Fund and the Reserve Fund have been assigned to the Authority to secure the City's obligations under this Ordinance and the City acknowledges that moneys in the Interest Account, the Principal Account, the Construction Loan Fund, the Debt Service Fund and the Reserve Fund shall be invested by the Authority,-subject to the Arbitrage Instructions, in Investment Securities in accordance with Section 4.9 of the Indenture. Moneys in each of the other funds and accounts created or ratified and confirmed by this Ordinance may be invested by the City in such other obligations as may be permitted by law; provided, however, that no such investment shall be made for a period extending longer than the date when the moneys invested may be needed for the purpose for which such fund or account was created. All earnings on any investments held in any fund or account shall accrue to and become a part of such fund or account. In determining the amount held in any fund or account under any of the provisions of this Ordinance, obligations shall be valued at the lower of the cost or the market value thereof. If and when the amount held in any fund or account held within the Treasury of the City shall be in excess of the amount required by the provisions of this Ordinance, the City shall direct that such excess be paid and credited to the Revenue Fund. So long as any of the Outstanding Senior Bonds remain outstanding and unpaid, any investments made pursuant to this Section shall be subject to any restrictions in the Outstanding Senior Bond Ordinance with respect to the funds and accounts created by and referred to in the Outstanding Senior Bond Ordinance. -16- ARTICLE IX PARTICULAR COVENANTS OF THE CITY T'he City covenants and agrees with each of the Owners of any of the Bonds that so long as any of the Bonds remain Outstanding and unpaid: Section 901. Efficient and Economical Operation. The City will continuously own and will operate the System in an efficient and economical manner and will keep and maintain the same in good repair and working order. Section 902. Rate Covenant. The City will fix, establish, maintain and collect such rates and charges for the use and services furnished by or through the System, including all extensions and improvements thereto hereafter constructed or acquired by the City, as will produce revenues sufficient to (a) pay the costs of the operation and maintenance of the System; (b)pay the principal of and interest on the Bonds as and when the same become due; (c) enable the City to have in each fiscal yeaz Net Revenues Available for Debt Service in an amount not less than 110% of the amount required to be paid by the City in such fiscal year on account of both principal of and interest on all System Revenue Bonds at the time outstanding, provided that interest on any SRF Program Bonds shall be reduced by the SRF Subsidy, if any; and (d) provide reasonable and adequate reserves for the payment of the Bonds and the interest thereon and for the protection and bene�t of the System as provided in this Ordinance. The City will require the prompt payment of accounts for service rendered by or through.the System and will promptly take whatever action is legally permissible to enforce and collect delinquent charges. Section 903. Reasonable Char�es for all Services. None of the facilities or services provided by the System will be furnished to any user (excepting the City itsel�without a reasonable charge being made therefor. In the event that the revenues derived by the City from the System shall at any time be insu�cient to pay the reasonable expenses of operation and maintenance of the System and also to pay all interest on and principal of the Bonds as and when the same become due, then the City will thereafter pay into the Revenue Fund a fair and reasonable payment in accordance with effective applicable rates and charges for all services or other facilities furnished to the City or any of its departments by the System, and such payments will continue so long as the same may be necessary in order to prevent or reduce the amount of any default in the payment of the interest on or principal of the Bonds. Section 904. Annual Bud�et. Prior to the commencement of each fiscal year, the chief financial o�cer of the City or other representative of the City designated by the Governing Body of the City will cause to be prepared and filed with the City Clerk a budget setting forth the estimated receipts and expenditures of the System for the next succeeding fiscal yeaz. The City Clerk, within 30 days after the end of the current fiscal year, will mail a copy of said budget to the Bondowner and the Trustee. Said annual budget shall be prepazed in accordance with the requirements of the laws of the State and shall contain all information as shall be required by such laws. Section 905. Annual Audit. Annually, promptly after the end of the fiscal year, the City will cause an audit to be made of the System for the preceding fiscal year by a certified public accountant or firm of certified public accountants to be employed for that purpose and paid from the revenues of the System. Said annual audit shall cover in reasonable detail the operation of the System during such fiscal year. -17- Within 120 days after the end of the City's fiscal year, a copy of the annual audit shall be filed in the off'ice of the City Clerk, and a duplicate copy of said audit shall be mailed to the Bondowner and the Trustee. Such audits shall at all times during the usual business hours be open to the examination and inspection by any taxpayer, any user of the services of the System, any Owner of any of the Bonds, or by anyone acting for or on behalf of such taxpayer, user or Owner. As soon as possible after the completion of such annual audit, the Governing Body of the City shall review such audit, and if any audit shall disclose that proper provision has not been made for all of the requirements of this Ordinance and the law under which the Bonds are issued, the City covenants and agrees that it will promptly cure such deficiency and will promptly proceed to increase the rates and charges to be charged for the use and services furnished by the System as may be necessary to adequately provide for such requirements. Section 906. Performance of Duties. The City will faithfully and punctually perform all duties and obligations with respect to the operation of the System, including all extensions and improvements thereto, now or hereafter imposed upon the City by the Constitution and laws of the State of Missouri and by the provisions of this Ordinance. Section 907. Tax Covenants. The City will comply with the provisions of the Code relating to the exclusion from federal gross income of the interest on the Bonds. The City will, in addition, adopt such other ordinances or resolutions and take such other actions as may be necessary to comply with the Code and with all other applicable future laws, regulations, published rulings and j�dicial decisions, in order to ensure that the interest on the Bonds will remain excludable from federal gross income, to the extent any such actions can be taken by the Governing Body of the City. • The City covenants and agrees that it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of the interest on the Bonds under Section 103 of the Code. The City covenants and agrees that it will use the proceeds of the Bonds as soon as practicable and with all reasonable dispatch for the purpose for which the Bonds aze issued as hereinbefore set forth, and that it will not directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the City, or take or omit to take any action that would cause the Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Code. To that end, the City will comply with all requirements of Section 148 of the Code to the extent applicable to the Bonds. In the event that at any time the City is of the opinion that for purposes of this Section it is necessary to restrict or limit the yield on the investment of any moneys held by the City under this Ordinance, the City shall take such action as may be necessary. Without limiting the generality of the foregoing, the City agrees that there shall be paid from time to time all amounts required to be rebated to the United States pursuant to Section 148(fj of the Code and any temporary, proposed or final Treasury Regulations as may be applicable to the Bonds from time to time. This covenant shall survive payment in full or defeasance of the Bonds. The City specifically covenants to pay or cause to be paid to the United States the rebatable arbitrage in accordance with the Arbitrage Instructions. ARTICLE X ADDITIONAL BONDS -18- Section 1001. Prior Lien Bonds. The City covenants and agrees that so long as any of the Bonds remain Outstanding, the City will not issue any debt obligations payable out of the revenues of the System or any part thereof which aze superior in lien, security or otherwise to the Bonds. Section 1002. Parity, Lien Bonds or Obligations. The City covenants and agrees that so long as any of the Bonds remain Outstanding, the City will not issue any additional bonds or other long-term obligations payable out of the net income and revenues of the System or any part thereof which stand on a parity or equality with the Bonds unless the following conditions are met: (a) The City shall not be in default in the payment of principal of or interest on any Bonds or the Parity Bonds or in making any payment at the time required to be made into the respective funds and accounts created by and referred to in this Ordinance or any Parity Ordinance; and (b) The City shall obtain a certificate showing either of the following: (1) The average annual Net Revenues Available for Debt Service derived by the City from the operation of the System as set forth in the last available audit, for the two fiscal years immediately preceding the issuance of additional bonds, shall have been equal to at least 110% of the average annual amount required to be paid out of said Net Revenues Available for Debt Service in succeeding fiscal years�on account of both principal (at maturity) and interest becoming due with respect to all System Revenue Bonds of the City, including the additional bonds proposed to be issued, provided that interest on any SRF Program Bonds shall be reduced by the SRF Subsidy, if any. In determining the Net Revenues Available for Debt Service for the purpose of this subsection, the City may adjust said Net Revenues Available for Debt Service by adding thereto, in the event the City shall have made any increase in rates for the use and services of the System and such increase shall not have been in effect during all of the two fiscal yeazs immediately preceding the issuance of additional bonds, the amount of the additional Net Revenues Available for Debt Service which would have resulted from the operation of the System during said two preceding fiscal years had such rate increase been in effect for the entire period; or (2) The estimated average annual Net Revenues Available for Debt Service derived by the City from the operation of the System for the two fiscal years immediately following the fiscal year in which the improvements to the System, the cost of which is being financed by such additional bonds, are to be in commercial operation, as certified by the Consulting Engineer, shall be equal to at least 110% of the average annual amount required to be paid out of said revenues in succeeding fiscal yeazs following such commercial operation on account of both principal (at maturity) and interest becoming due with respect to all System Revenue Bonds of the City, including the additional bonds proposed to be issued,provided that interest on any SRF Program Bonds shall be reduced by the SRF Subsidy, if any. In determining the amount of estimated Net Revenues Available for Debt Service for the purpose of this subsection, the Consulting Engineer may adjust said estimated net revenues by adding thereto any estimated increase in Net Revenues Available for Debt Service resulting from any increase in rates for the use and services of the System which have been approved by the City. -19- Additional revenue bonds or other obligations of the City issued under the conditions set forth in this Section shall stand on a parity with the Bonds and shall enjoy complete equality of lien on and claim against the net revenues of the System with the Bonds, and the City may make equal provision for paying said bonds and the interest thereon out of the Revenue Fund and may likewise provide for the creation of reasonable system debt service funds and system debt service reserve funds for the payment of such additional bonds and the interest thereon out of moneys in the Revenue Fund. Section 1003. Junior Lien Bonds. Nothing in this Article contained shall prohibit or restrict the right of the City to issue additional revenue bonds or other revenue obligations for the purpose of extending, improving, enlarging, repairing or altering the System and to provide that the principal of and interest on said revenue bonds or obligations shall be payable out of the revenues of the System, provided at the time of the issuance of such additional revenue bonds or obligations the City shall not be in default in the performance of any covenant or agreement contained in this Ordinance, and provided further that such additional revenue bonds or obligations shall be junior and subordinate to the Bonds so that if at any time the City shall be in default in paying either interest on or principal of the Bonds, or if the City shall be in default in making any payments required to be made by it under the provisions of paragraphs (a), (b) and (c) of Section 702 of this Ordinance, the City shall make no payments of either principal of or interest on said junior and subordinate revenue bonds or obligations until said default or defaults be cured. In the event of the issuance of any such junior and subordinate revenue bonds or obligations, the City, subject to the provisions aforesaid, may make provision for paying the principal of and interest on said revenue bonds or obligations out of moneys in the Revenue Fund. , Section 1004. Refunding Bonds. The City shall have the right, if it�shall find it desirable, without complying with the provisions of Section 1002 hereof, to refund any of the Bonds under the provisions of any law then available and the refunding bonds so issued shall enjoy complete equality of pledge with any of the Bonds which are not refunded, if any, upon the revenues of the System; provided, however, that if only a portion of the Bonds be refunded and if said Bonds are refunded in such manner that the refunding bonds bear a higher average rate of interest or become due on a date earlier than that of the Bonds which are refunded, then said Bonds may be refunded without complying with the provisions of Section 1002 hereof only by and with the written consent of the Authority and DNR. ARTICLE XI DEFAULT AND REMEDIES Section 1101. Acceleration of Maturity in Event of Default. (a) The City covenants and agrees that if(i) it shall default in the payment of the principal of or interest on any of the Bonds as the same shall become due, or (ii) if the City or its Governing Body or any of the off'icers, agents or employees thereof shall fail or refuse to comply with any of the provisions of this Ordinance, the Constitution or statutes of the State of Missouri, the Purchase Agreement or the Revolving Fund Agreement and such default shall continue for a period of 60 days after written notice specifying such default shall have been given to the City by the Trustee, the Authority,DNR or the Owner of any Bond then Outstanding,then, at any time thereafter and while such default shall continue, the Owners of 25% in principal amount of the Bonds then Outstanding may, by written notice to the City filed in the office of the City Clerk or delivered in person to said City Clerk, declare the principal and Compound Accreted Value of all -20- Bonds then Outstanding to be due and payable immediately, and upon any such declaration given as aforesaid, all of said Bonds shall become and be immediately due and payable, anything in this Ordinance or in the Bonds contained to the contrary notwithstanding. This provision, however, is subject to the condition that if at any time after the Compound Accreted Value of said Outstanding Bonds shall have been so declared to be due and payable, all arrears of Compound Accreted Value upon all of said Bonds, except interest accrued but not yet due on such Bonds and penalties (as provided in paragraph (b) of this Section) shall have been paid in full and all other defaults, if any, by the City under the provisions of this Ordinance, the Constitution and statutes of the State of Missouri, the Purchase Agreement and the Revolving Fund Agreement shall have been cured, then and in every such case the Owners of a majority in Compound Accreted Value of the Bonds then Outstanding,by written notice to the City given as hereinbefore specified, may rescind and annul such declaration and its consequences, but no such rescission or annulment shall extend to or affect any subsequent default or impair any rights consequent thereon. (b) In the event of a default as described in paragraph (a) of this Section, the City shall pay to DNR such penalties as are assessed by DNR in accordance with the Regulations. Such penalty shall be assessed as a reduction in the credit provided in Section 702(b)(1)(A) of this Ordinance. Section 1102. Remedies. The provisions of this Ordinance, including the covenants and agreements herein contained, shall constitute a contract between the City and the Owners of the Bonds, and the Owner or Owners of not less than 10% in principal amount of the �Bonds at the time Outstanding shall have the right for the equal benefit and protection of all Owners of Bonds similarly situated: (a) by mandamus or other suit, action or proceedings at law or in equity to enforce the rights of such Owner or Owners against the City and its off'icers, agents and employees, and to require and compel duties and obligations required by the provisions of this Ordinance or by the Constitution and laws of the State of Missouri; (b) by suit, action or other proceedings in equity or at law to require the City, its o�cers, agents and employees to account as if they were the trustees of an express trust; and (c) by suit, action or other proceedings in equity or at law to enjoin any acts or things which may be unlawful or in violation of the rights of the Owners of the Bonds. Any amounts paid on the Bonds to the Owners thereof shall be applied first to Compound Accreted Value of the Bonds (less the Original Principal Amount thereofl, and second to the Original Principal Amount thereof, to the extent due and payable. Section 1103. Limitation on Ri�hts of Bondowners. No one or more Bondowners secured hereby shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security granted and provided for herein, or to enforce any right hereunder, except in the manner herein provided, and all proceedings at law or in equity shall be instituted, had and maintained for the equal benefit of all Owners of such Outstanding Bonds. Section 1104. Remedies Cumulative. No remedy conferred herein upon the Bondowners is intended to be exclusive of any other remedy, but each such remedy shall be cumulative and in addition to every other remedy and may be exercised without e�austing and without regard to any other remedy -21- conferred herein. No waiver of any default or breach of duty or contract by the Owner of any Bond shall extend to or affect any subsequent default or breach of duty or contract or shall impair any rights or remedies thereon. No delay or omission of any Bondowner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Owners of the Bonds by this Ordinance may be enforced and exercised from time to time and as often as may be deemed expedient. In case any suit, action or proceedings taken by any Bondowner on account of any default or to enforce any right or exercise any remedy shall have been discontinued or abandoned for any reason, or shall have been determined adversely to such Bondowner, then, and in every such case, the City and the Owners of the Bonds shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies, powers and duties of the Bondowners shall continue as if no such suit, action or other proceedings had been brought or taken. Section 1105. No Obligation to Levy Taxes. Nothing contained in this Ordinance shall be construed as imposing on the City any duty or obligation to levy any taaces either to meet any obligation incurred herein or to pay the principal and Compound Accreted Value of or interest on the Bonds. ARTICLE XII DEFEASANCE Section 1201. Defeasance. When all of the Bonds shall have been paid and discharged, then the requirements contained in this Ordinance and the pledge of revenues made hereunder and all other rights granted hereby shall terminate. Bonds shall be deemed to have been paid and discharged within the meaning of this Ordinance if there shall have been deposited with the Paying Agent, or other bank or trust company located in the State of Missouri, having full trust powers and meeting the requirements of a successor Trustee under the Indenture impressed with a first lien to the Paying Agent for the benefit of the Bondowners, (a) at or prior to the maturity date of said Bonds, in trust for and irrevocably appropriated thereto, moneys and/or non-callable Defeasance Securities which, together with the interest to be earned on any such obligations, as evidenced by the written report of an independent certified public accountant, will be sufficient for the payment of the Compound Accreted Value of said Bonds to the date of maturity, or if default in such payment shall have occurred on such date, then to the date of the tender of such payments, and (b) an opinion of Bond Counsel addressed to the Authority and the Trustee to the effect that providing for the payment of the Bonds by depositing moneys or Defeasance Securities with the Trustee in accordance with this Section will not cause the interest on the Bonds to be included in gross income for federal income ta�c purposes. Any moneys and obligations which at any time shall be deposited with the Paying Agent or other bank by or on behalf of the City, for the purpose of paying and discharging any of the Bonds, shall be and are hereby assigned, transferred and set over to the Paying Agent or other bank in trust for the respective Owners of the Bonds, and such moneys shall be and are hereby irrevocably appropriated to the payment and dischazge hereof. All moneys deposited with the Paying Agent or other bank shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance. ARTICLE XIII AMENDMENTS -22- Section 1301. Amendments. Any provision of the Bonds or of this Ordinance may be amended or modified by an ordinance duly adopted by the Governing Body of the City at any time and in any respect with the written consent of the Authority and the Trustee, such consent to be evidenced by an instrument or instruments executed by the Authority and the Trustee and acknowledged or proved in the manner of a deed to be recorded, and such instrument or instruments shall be filed with the City Clerk, but no such modification or alteration shall: (a) extend the maturity of any Bond; (b) effect a reduction in the amount which the City is required to pay by way of Compound Accreted Value of any Bond; (c) permit the creation of a lien on the revenues of the System prior or equal to the lien of the Bonds or additional bonds hereafter issueti on a parity with the Bonds except as hereinbefore provided; (d) permit preference or priority of any Bonds over any other Bonds; or (e) reduce the percentage in Compound Accreted Value of Bonds required for the written consent to any modification or alteration of the provisions of this Ordinance. Notwithstanding anything to the contrary in this Section, before the City enters into any amendment of or modification of this Ordinance, there shall have been delivered to the Bondowner, the Trustee, DNR and the City an opinion of Bond Counsel stating that such amendment of or modification of this Ordinance is authorized or permitted by this Indenture and the Act, complies with their respective terms, will, upon the execution and delivery thereof, be valid and binding upon the City in accordance with its terms and will not adversely affect the exclusion of interest on the Authority Bonds from gross income for federal income tax purposes. Any and all modifications made in the manner hereinabove provided shall not become effective until there has been filed with the City Clerk a copy of the ordinance of the City hereinabove provided for, duly certified, as well as proof of any required consent to such modification by the Bondowner. It shall not be necessary to note on any of the Outstanding Bonds any reference to such amendment or modification. ARTICLE XIV MISCELLANEOUS PROVISIONS Section 1401. Further Authoritv. The o�cers of the City, including the Mayor, the City Manager and the City Clerk, shall be, and they hereby are, authorized and directed to execute all documents and take such actions as they may deem necessary or advisable in order to carry out and perform the purposes of this Ordinance and to make ministerial alterations, changes or additions in the foregoing agreements, statements, instruments and other documents herein approved, authorized and confirmed which they may approve and the execution or taking of such action shall be conclusive evidence of such necessity or advisability. -23- Section 1402. Principal Amount of the Bonds. In determining whether the Bondowners of the requisite principal amount of Bonds Outstanding have given any request, demand, authorization, direction, notice, consent or waiver under this Ordinance, the terms "principal" and "principal amount" shall mean the Compound Accreted Value of the Bonds as of the most recent Compounding Date preceding such date. Section 1403. Severabilitv. If any section or other part of this Ordinance, whether large or small, shall for any reason be held invalid, the invalidity thereof shall not affect the validity of the other provisions of this Ordinance. Section 1404. Governing Law. This Ordinance shall be governed exclusively by and constructed in accordance with the applicable laws of the State. Section 1405. Effective Date. Pursuant to Section 3.15 of the Charter of the City of Cape Girardeau, Missouri, this measure is adopted as an emergency measure as it constitutes a Bill making an appropriation for the payment of principal or interest of the public debt and concerning the immediate preservation of public peace, property, health, safety or morals in order to provide for the immediate financing of improvements to the City's wastewater treatment facilities. Accordingly, this Ordinance will take effect immediately upon its passage and approval. PASSED AND APPROVED by the City Council of the City of Cape Girardeau, Missouri, this 23rd day of June, 1995. Mayor (Seal) ATTEST: eputy City Clerk -24- CERTIFICATE I, the undersigned, Deputy City Clerk of the City of Cape Girazdeau, Missouri, hereby certify that the above and foregoing constitutes a full, true and correct copy of Ordinance No. duly adopted by the Governing Body of the City at a meeting duly held on June 23, 1995 upon adjournment from the June 19, 1995 meeting of the Governing Body, after proper notice thereof; that said Ordinance has not been modified, amended or repealed, and is in full force and effect as of the date hereof; and that the same is on file in my office. WITNESS my hand and official seal this day of June, 1995. (Seal) Deputy City Clerk Cape Girardeau EXHIBIT A 1. Original Principal Amount - Section 201. $11,462,661.15 2. Maturitv Schedule - Section 203. Maturity Date Original Interest Maturity Januar� Principal Amount Rate Amount 1998 $ 22,225.75 4.75% $ 25,000.00 1999 21,134.00 4.85 25,000.00 2000 20,056.75 4.95 25,000.00 2001 913,209.25 5.10 1,205,000.00 2002 913,676.80 5.25 1,280,000.00 2003 918,380.80 5.30 1,360,000.00 2004 924,768.90 5.40 1,455,000.00 2005 928,412.75 5.50 1,555,000.00 2006 932,824.25 5.65 1,675,000.00 2007 937,566.00 5.75 1,800,000.00 2008 943,266.80 5.85 1,940,000.00 2009 946,770.00 5.95 2,090,000.00 2010 722,409.45 6.05 1,715,000.00 2011 413,5%4.00 6.10 1,050,000.00 2012 380,828.25 6.15 1,035,000.00 201'3 354,9%8.00 6.15 1,025,000.00 2014 326,2$0.50 6.20 1,010,000.00 2015 303,920.00 6.20 1,000,000.00 2016 278,843.65 6.25 985,000.00 2017 259,535.25 6.25 975,000.00 3. Administrative Fee Calculation Dates - Section 212. The Business Day preceding each January 1, commencing January 1, 1998. 4. Rebate Requirement - Section 212. In addition to those payments to be made by the City pursuant to Section 212 of this Ordinance, the City shall pay to the Trustee for deposit to the Interest Account and subsequent transfer as provided in the Indenture, an amount equal to rebatable arbitrage, and the costs incurred in connection with detennining such rebatable arbitrage, at the times and in the amounts as determined in accocdance �v;th fhe Arbitrage Instructions. 5. Costs of Issuance - Section E01. $270,108.22. A-1 ' EXHIBIT B FORM OF BOND [THIS BOND IS TRANSFERABLE ONLY TO ANY SUCCESSOR TO THE STATE ENVIRONMENTAL IMPROVEMENT AND ENERGY RESOURCES AUTHORITY OR ITS ASSIGNS] UNITED STATES OF AMERICA STATE OF MISSOURI Registered Registered Maturity Amount: No. CR- $ CITY OF CAPE GIRARDEAU, MISSOURI CAPITAL APPRECIATION SEWERAGE SYSTEM REVENUE BOND (STATE REVOLVING FUND PROGRAM) SERIES 1995 Interest Original Principal Maturity Rates Amounts Amounts Maturitv Dates Dated Date Schedule I Schedule I Schedule I Schedule I June 29, 1995 REGISTERED OWNER: STATE ENVIRONMENTAL IMPROVEMENT AND ENERGY RESOURCES AUTHORITY AGGREGATE MATURITY AMOUNT: DOLLARS The CITY OF CAPE GIRARDEAU, MISSOURI, a constitutional charter city and political subdivision of the State of Missouri (the "City"), for value received, hereby promises to pay to the Registered Owner shown above, or registered assigns, the Maturity Amount shown above on the Maturity Date shown above, representing the Original Principal Amount shown above plus interest accrued and compounded thereon at the interest rate per annum shown above (computed on the basis of a 360-day year of twelve 30-day months) from the Dated Date shown above to the Maturity Date shown above, with interest compounded semiannually on January 1 and July 1 in each year, beginning on January 1, 1996,to the Compound Accreted Values provided in the Ordinance(defined herein), until said Maturity Amount has been paid. The Compound Accreted Value of this Bond shall be paid at maturity to the person in whose name this Bond is registered at the maturity thereof, upon presentation and surrender of this Bond at the principal corporate trust office of MERCANTILE BANK OF ST. LOUIS NATIONAL ASSOCIATION in the City of St. Louis, Missouri, (the "Paying Agent"). The principal of and interest on this Bond shall be payable in lawful money of the United States of America. B-1 . This Bond is one of a duly authorized series of bonds of the City designated "Capital Appreciation Sewerage System Revenue Bonds (State Revolving Fund Program) Series 1995" aggregating the principal amount of$11,462,661.15 (the "Bonds"), issued by the City for the purpose of extending and improving its sewerage system (said sewerage system, together with all future improvements and extensions thereto hereafter constructed or acquired by the City, being herein called the "System"), under the authority of and in full compliance with Chapter 250 of the Revisetl Statutes of Missouri, as amended, and pursuant to an election duly held in the City and an ordinance duly adopted by the governing body of the City (herein called the "Ordinance"). The Bonds are limited obligations of the City payable solely from, and secured as to the payment of principal and interest by a pledge of, the revenues derived by the City from the operation of the System, and the ta�cing power of the City is not pledged to the payment of the Bonds either as to principal or interest. The Bonds shall not be or constitute a general obligation of the City, nor shall they constitute an indebtedness of the City within the meaning of any constitutional, statutory or charter provision, limitation or restriction. Under the conditions set forth in the Ordinance, the City has the right to issue additional parity bonds payable from the same source and secured by the same revenues as the Bonds; provided, however, that such additional bonds may be so issued only in accordance with and subject to the covenants, conditions and restrictions relating thereto set forth in the Ordinance. The Bonds shall be junior and subordinate with respect to payment of principal and interest from the Revenues derived by the City from the operation of the System and in all other respects to the Outstanding Senior Bonds (as defined in the Ordinance) and, in the event of any default in the payment of either principal of or interest on any of the Outstanding Senior Bonds, all of the Revenues of the System, including all extensions and improvements thereof, will be applied solely to the payment of the principal of and interest on the Outstanding Senior Bonds until such default is cured. The City hereby covenants with the Owner of this Bond to keep and perform all covenants and agreements contained in the Ordinance, and the City will fix, establish, maintain and collect such rates, fees and charges for the use and services furnished by or through the System, as will produce revenues suff'icient to pay the costs of operation and maintenance of the System, pay the principal of and interest on the Bonds as and when the same become due, and provide reasonable and adequate reserve funds. Reference is made to the Ordinance for a description of the covenants and agreements made by the City with respect to the collection, segregation and application of the revenues of the System, the nature and extent of the security of the Bonds, the rights, duties and obligations of the City with respect thereto, and the rights of the Owners thereof. The Bonds are issuable in the form of fully registered Bonds without coupons in Authorized Denominations as provided in the Ordinance. This Bond may be transferred or exchanged, as provided in the Ordinance, only upon the registration books kept for that purpose at the above-mentioned o�ce of the Paying Agent, upon surrender of this Bond together with a written instrument of transfer or exchange satisfactory to the Paying Agent duly executed by the Registered Owner or the Registered Owner's duly authorized agent, and thereupon a new Bond or Bonds in any Authorized Denomination of the same maturity and in the same aggregate original principal amount shall be issued to the transferee in exchange therefor as provided in the Ordinance, and upon payment of the charges therein prescribed. The City and the Paying Agent may deem and treat the person in whose name this Bond is registered as the absolute B-2 owner hereof for the purpose of receiving payment of, or on account of, the principal of and interest due hereon and for all other purposes. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Ordinance until the Certificate of Authentication hereon shall have been executed by the Paying Agent. IT IS HEREBY CERTIFIED 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, happened and been performed in due time, form and manner as required by law, and that before the issuance of the Bonds, provision has been duly made for the collection and segregation of the revenues of the System and for the application of the same as hereinbefore provided. IN WITNESS WHEREOF, the City of Cape Girardeau, Missouri, has executed this Bond by causing it to be signed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk, and its official seal to be affixed hereto or imprinted hereon, and this Bond to be dated the Dated Date shown above. CERTIFICATE OF AUTHENTICATION CITY OF CAPE GIRARDEAU, MISSOURI This Bond is one of the Bonds � of the issue described in the within-mentioned Ordinance. By Mayor � Registration Date: MERCANTILE BANK OF ST. LOUIS NATIONAL ASSOCIATION, Paying Agent (Seal) ATTEST: By Authorized Signatory Deputy City Clerk ----------------------------------------------- ----------------------------------------------- RECORD OF PRINCIPAL PAYMENTS AND PREPAYMENTS Under the provisions of the Ordinance, partial payments of the Compound Accreted Value of this Bond may be made directly to the Bondowner without surrender of this Bond to the Paying Agent. Accordingly, any purchaser or other transferee of this Bond should verify with the Paying Agent the Compound Accreted Value of this Bond outstanding prior to such purchase or transfer, and the records of the Paying Agent shall be conclusive for such purposes. B-3 Y ��_�__�___��___��_�-��-��_�-��_-��_�� _�-��_�_��-��_�-�� ASSIGNMENT FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Print or Type Name and Address the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints agent to transfer the within Bond on the books kept by the Paying Agent for the registration thereof, with full power of substitution in the premises. Dated: NOTICE: T'he signature to this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular. Signature Guaranteed By: NOTICE: Signature(s) must be guaranteed by an eligible guarantor institution as defined by SEC Rule 17Ad-15 (17 CFR 240.17Ad-15). ----------------------------------------------- ----------------------------------------------- B-4 SCHEDULEI CITY OF CAPE GIRARDEAU, MISSOURI SEWERAGE SYSTEM REVENUE BOND (STATE REVOLVING FUND PROGRAM) SERIES 1995 Maturity Date Original Interest Maturity January 1 Principal Amount Rate Amount 1998 $ 22,225.75 4.75% $ 25,000.00 1999 21,134.00 4.85 25,000.00 2000 20,056.75 4.95 25,000.00 2001 913,209.25 5.10 1,205,000.00 2002 913,676.80 5.25 1,280,000.00 2003 918,380.80 5.30 1,360,000.00 2004 924,768.90 5.40 1,455,000.00 2005 928,412.75 5.50 1,555,000.00 2006 932,824.25 5.65 1,675,000.00 2007 937,566.00 5.75 1,800,000.00 2008 943,266.80 5.85 1,940,000.00 2009 946,770.00 5.95 2,090,000.00 2010 722,409.45 6.05 1,715,000.00 2011 413,574.00 6.10 1,050,000.00 2012 380,828.25 6.15 1,035,000.00 2013 354,978.00 6.15 1,025,000.00 2014 326,280.50 6.20 1,010,000.00 2015 303,920.00 6.20 1,000,000.00 2016 278,843.65 6.25 985,000.00 2017 259,535.25 6.25 975,000.00