2190ORDINANCE NO. '2 t Cj o
AN ORDINANCE AUTHORIZING THE ISSUANCE OF SEWER SYSTEM REVENUE BONDS,
SERIES 2010, OF THE CITY OF BLAIR, NEBRASKA, IN THE AGGREGATE PRINCIPAL
AMOUNT OF ONE MILLION SIX HUNDRED FORTY -FIVE THOUSAND DOLLARS ($1,645,000)
FOR THE PURPOSE OF PROVIDING FOR THE PAYMENT AND REDEMPTION OF THE CITY'S
OUTSTANDING SEWER REVENUE BOND ANTICIPATION NOTES, SERIES 2007, IN THE
PRINCIPAL AMOUNT OF $1,455,000; DIRECTING THE APPLICATION OF THE PROCEEDS OF
SAID BONDS; PRESCRIBING THE FORM, TERMS AND DETAILS OF SAID BONDS; PLEDGING
AND HYPOTHECATING THE REVENUES AND EARNINGS OF THE SEWAGE DISPOSAL
PLANT AND SANITARY SEWER SYSTEM OF SAID CITY FOR THE PAYMENT OF SAID
BONDS AND INTEREST THEREON; PROVIDING FOR THE COLLECTION, SEGREGATION
AND APPLICATION OF THE REVENUES OF SAID SEWAGE DISPOSAL PLANT AND
SANITARY SEWER SYSTEM; ENTERING INTO A CONTRACT ON BEHALF OF THE CITY
WITH THE HOLDERS OF SAID BONDS; AND PROVIDING FOR PUBLICATION OF THIS
ORDINANCE IN PAMPHLET FORM.
BE IT ORDAINED by the Mayor and Council of the City of Blair, Nebraska, as follows:
Section 1. The Mayor and City Council of the City of Blair, Nebraska (the "City ")
hereby find and determine:
(a) The City owns and operates a sewage disposal plant and sanitary sewer
system which constitutes a revenue producing facility and undertaking within the
meaning of such term as set forth in Sections 18 -1803 to 18 -1805 R.R.S. Neb. 2007; that
said plant and system together with all additions and improvements thereto hereafter
acquired or constructed are herein referred to as the "Sewer System ";
(b) The City has heretofore issued and outstanding the following revenue bonds
which are a lien upon and secured by a pledge of the revenue and earnings of the Sewer
System:
Sewer System Revenue Refunding Bonds, Series 2004, Date of Original
Issue - December 15, 2004, issued pursuant to Ordinance No. 2017 of the
City, of which $625,000 in principal amount are presently outstanding (the
"Series 2004 Bonds ");
Sewer System Revenue Bond Anticipation Notes, Series 2007, Date of
Original Issue - July 30, 2007, of which $1,455,000 are outstanding (the
"Series 2007 Notes ");
The Series 2004 Bonds and the Series 2007 Notes represent the only
indebtedness of the City for which the revenues and earnings of the Sewer
System have been pledged.
(c) The City determined that it was necessary and advisable for the City to
construct certain improvements to the Sewer System. The City has constructed said
improvements which include the costs of replacement of an existing sludge pump,
installation of a new lift pump, replacement of the aeration equipment with a new air
diffuser system, replacement of the existing air pumps, construction of a new sanitary
sewer main and the lining of a sewer main. The Series 2007 Notes provided interim
financing for a portion of the improvements and the total cost of said improvements
requiring permanent funding (including related expenses for bond issuance) is not less
than $1,645,000; and to fund such costs (including redemption of the Series 2007 Notes
on August 17, 2010), it is hereby determined appropriate to issue revenue bonds payable
from the revenues of the Sewer System in such amount;
(d) Under the terms of Section 13 of Ordinance No. 2017, the City is authorized to issue
bonds which qualify as "Additional Bonds" of equal lien to the Series 2004 Bonds, provided that
the "Net Revenues Test" described in Section 13(b)(1) of Ordinance 2017 can be satisfied. With
respect to said conditions, the following determinations are hereby made:
1) The "Net Revenues" of the Sewer System as defined in Ordinance
2017, as shown in the City's audit report as conducted by independent
certified public accountants for the fiscal year ended September 30,
2009, were not less than $355,000.
2) The "Average Annual Debt Service Requirements" of the Series 2004
Bonds and the proposed Series 2010 Bonds are not more than $280,000;
3) Said "Net Revenues" exceed 1.25 times said "Average Annual Debt
Service Requirements" of the Series 2004 Bonds and of the proposed
Series 2010 Bonds and this Ordinance provides for additional deposits
to be made to the Bond Payment Account sufficient to pay when due the
principal and interest of the proposed Series 2010 Bonds.
4) All conditions required by Section 13 of Ordinance No. 2017 precedent
to the issuance of the Series 2010 Bonds as "Additional Bonds" of equal
priority and on a parity with the Series 2004 Bonds do exist and have
happened.
(e) To satisfy the funding requirements described in this Section 1, including funding of
appropriate reserves and payment of issuance costs, it is necessary for the City to issue its Sewer
System Revenue Bonds, Series 2010, in the total principal amount of $1,645,000 pursuant to
Sections 18 -1803 to 18 -1805 R.R.S. Neb. 2007. All conditions, acts and things required by law
to exist or to be done precedent to the issuance of the City's Sewer System Revenue Bonds in the
principal amount of $1,645,000, do exist and have been done and performed in regular and due
time and form as required by law. Said bonds shall be payable from the revenues of the Sewer
System.
Section 2. In addition to the definitions provided in parentheses elsewhere in this Ordinance, the
following definitions of terms shall apply, unless the context shall clearly indicate otherwise:
(a) the term "Additional Bonds" shall mean any and all bonds hereafter issued by
the City pursuant to the terms of this Ordinance which are equal in lien to the Series 2010
Bonds and the Series 2004 Bonds, including any such bonds issued pursuant to Section 13
and refunding bonds issued pursuant to Section 14.
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(b) the term "Average Annual Debt Service Requirements" shall mean that number
computed by adding all of the principal and interest due when computed to the absolute maturity
of the bonds for which such computation is required and dividing by the number of years
remaining that the longest bond of any issue for which such computation is required has to run to
maturity. In making such computation, the principal of any bonds for which mandatory
redemptions are scheduled shall be treated as maturing in accordance with such schedule of
mandatory redemptions.
(c) the term "Deposit Securities" shall mean obligations of the United States of America,
direct or unconditionally guaranteed, including any such obligations issued in book entry form.
(d) the term "Net Revenues" shall mean the gross revenues derived by the City from the
ownership or operation of the Sewer System, including investment income, but not including any
income from sale or disposition of any property belonging to or forming a part of the Sewer
System, less the ordinary expenses for operating and maintaining the Sewer System payable from
the Operation and Maintenance Account described in Section 11 of this Ordinance. Operation
and Maintenance expenses for purposes of determining "Net Revenues" shall not include
depreciation, amortization of financing expenses or interest on any bonds or other indebtedness.
Net Revenues for all purposes of this Ordinance shall be shown by an audit for the fiscal year in
question as conducted by an independent certified public accountant or firm of such accountants,
provided, however, that in the case of issuance of Additional Bonds, for that period from the end
of each fiscal year until the financial statements reported on by the City's accountants are
available, Net Revenues shall either (i) be based upon the most recent fiscal year for which there
are financial statements which have been reported on by such accountants so long as the
unaudited financial information for the then most recently completed fiscal year as certified by
the City Treasurer would not result in a contrary determination, if such unaudited financial
information were deemed the completed and reported on results or (ii) based upon a report of the
City's accountants that the completed and reported on results will not be less than such amount as
such accountants shall confirm.
(e) the term "Paying Agent and Registrar" shall mean the Treasurer of the City of Blair,
Nebraska, as appointed to act as paying agent and registrar for the Series 2010 Bonds pursuant to
Section 4 hereof, or any successor thereto.
(f) the term "Revenues" shall mean all of the rates, rentals, fees and charges, earnings and
other monies, including investment income, from any source derived by the City of Blair,
Nebraska, through its ownership and operation of the Sewer System.
Section 3. For the purposes described in Section 1 of this Ordinance, there shall be and there are
hereby ordered issued negotiable bonds of the City of Blair, Nebraska, to be designated as "Sewer System
Revenue Bonds, Series 2010" (the "Series 2010 Bonds ") in the aggregate principal amount of One
Million Six Hundred Forty-five Thousand Dollars ($1,645,000), with said bonds bearing interest at the
rates per annum and to become due on October 1 of the year as indicated below:
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Maturing on Amount of Interest Rate
October 1 of Year Principal Maturing Per Annum
2017 $ 10,000 2.70%
2018 105,000 2.90
2019 90,000 3.10
2020 95,000 3.30
2021 100,000 3.45
2022 100,000 3.60
2023 105,000 3.75
2024 110,000 3.90
2025 115,000 4.00
2030* 815,000 4.35
*Term Bonds
The Series 2010 Bonds due as term bonds on October 1, 2030 are sometimes referred to herein as the
"Term Bonds." The Series 2010 Bonds shall be issued in fully registered form in the denomination of
$5,000 or any integral multiple thereof. The date of original issue for the Series 2010 Bonds shall be the
date of delivery thereof. Interest on the Series 2010 Bonds, at the respective rates for each maturity, shall
be payable semiannually on April 1 and October 1 of each year commencing April 1, 2011 (each an
"Interest Payment Date "), and the Series 2010 Bonds shall bear such interest from the date of original issue
or the most recent Interest Payment Date, whichever is later. Interest shall be computed on the basis of a
360 -day year consisting of twelve 30 -day months. The interest due on each Interest Payment Date shall be
payable to the registered owners of record as of the fifteenth day of the calendar month immediately
preceding the calendar month in which the Interest Payment Date occurs (the "Record Date "), subject to
the provisions of Section 5 hereof. The Series 2010 Bonds shall be numbered from 1 upwards in the order
of their issuance. No Series 2010 Bond shall be issued originally or upon transfer or partial redemption
having more than one principal maturity. The initial bond numbering and principal amounts for each of
the Series 2010 Bonds issued shall be as designated by the City Treasurer as directed by the initial
purchaser thereof. Payments of interest due on the Series 2010 Bonds prior to maturity or earlier
redemption shall be made by the Paying Agent and Registrar as designated pursuant to Section 4 hereof,
by mailing a check or draft in the amount due for such interest on each Interest Payment Date to the
registered owner of each Series 2010 Bond, as of the Record Date for such Interest Payment Date, to such
owner's registered address as shown on the books of registration as required to be maintained in Section 4
hereof. Payments of principal due at maturity or at any date fixed for redemption prior to maturity
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together with any unpaid interest accrued thereon shall be made by said Paying Agent and Registrar to the
registered owners upon presentation and surrender of the Series 2010 Bonds to the Paying Agent and
Registrar. The City and the Paying Agent and Registrar may treat the registered owner of any Series 2010
Bond as the absolute owner of such Series 2010 Bond for the purpose of making payments thereon and for
all other purposes and neither the City nor the Paying Agent and Registrar shall be affected by any notice
or knowledge to the contrary, whether such Series 2010 Bond or any installment of interest due thereon
shall be overdue or not. All payments on account of interest or principal made to the registered owner of
any Series 2010 Bond in accordance with the terms of this Ordinance shall be valid and effectual and shall
be a discharge of the City and the Paying Agent and Registrar, in respect of the liability upon the Series
2010 Bonds or claims for interest to the extent of the sum or sums so paid.
Section 4. The City Treasurer is hereby designated as the Paying Agent and Registrar for the
Series 2010 Bonds provided that the City reserves the right to designate a bank or trust company to serve
in such capacity and upon such agreed terms as shall be determined by the Mayor and Council. The
Paying Agent and Registrar shall keep and maintain for the City books for the registration and transfer of
the Series 2010 Bonds at the City offices. The names and registered addresses of the registered owner or
owners of the Series 2010 Bonds shall at all times be recorded in such books. Any Series 2010 Bond may
be transferred pursuant to its provisions at the office of said Paying Agent and Registrar by surrender of
such bond for cancellation, accompanied by a written instrument of transfer, in form satisfactory to said
Paying Agent and Registrar, duly executed by the registered owner in person or by such owner's duly
authorized agent, and thereupon the Paying Agent and Registrar on behalf of the City will deliver at its
office (or send by registered mail to the transferee owner or owners thereof at such transferee owner's or
owners' risk and expense), registered in the name of such transferee owner or owners, a new Series 2010
Bond or Series 2010 Bonds of the same interest rate, aggregate principal amount and maturity. To the
extent of the denominations authorized for the Series 2010 Bonds by this Ordinance, one Series 2010 Bond
may be transferred for several such Series 2010 Bonds of the same interest rate and maturity, and for a like
aggregate principal amount, and several such Series 2010 Bonds may be transferred for one or several such
Series 2010 Bonds, respectively, of the same interest rate and maturity and for a like aggregate principal
amount. In every case of transfer of a Series 2010 Bond, the surrendered Series 2010 Bond or Series 2010
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Bonds shall be canceled and destroyed. All Series 2010 Bonds issued upon transfer of the Series 2010
Bonds so surrendered shall be valid obligations of the City evidencing the same obligations as the Series
2010 Bonds surrendered and shall be entitled to all the benefits and protection of this Ordinance to the
same extent as the Series 2010 Bonds upon transfer of which they were delivered. The City and said
Paying Agent and Registrar shall not be required to transfer any Series 2010 Bond during any period from
any Record Date until its immediately following Interest Payment Date or to transfer any Series 2010
Bond called for redemption for a period of 30 days next preceding the date fixed for redemption.
Section 5. In the event that payments of interest due on the Series 2010 Bonds on an Interest
Payment Date are not timely made, such interest shall cease to be payable to the registered owners as of
the Record Date for such Interest Payment Date and shall be payable to the registered owners of the Series
2010 Bonds as of a special date of record for payment of such defaulted interest as shall be designated by
the Paying Agent and Registrar whenever monies for the purpose of paying such defaulted interest become
available.
Section 6. The Series 2010 Bonds maturing on or after October 1, 2015, shall be subject to
redemption, in whole or in part, prior to maturity at any time on or after the fifth anniversary of the date of
original issue thereof, or at any time thereafter, at the principal amount thereof together with accrued
interest on the principal amount redeemed to the date fixed for redemption. Such optional redemption
shall be made from time to time as shall be directed by the Mayor and Council of the City. The City may
select the Series 2010 Bonds for optional redemption in its sole discretion. The Term Bonds are required
to be redeemed prior to their stated maturity, commencing on October 1, 2026, and continuing on
October 1 of each year thereafter, in part, from monies required to be deposited by the City into the Bond
Payment Account for such mandatory redemption, which redemptions shall be in the years and for the
principal amounts set forth below:
Year of Redemption Amount Required to be Redeemed
2026 $120,000
2027 125,000
2028 130,000
2029 135,000
2030 (final maturity) 305,000
Such scheduled mandatory redemptions shall be at a price equal to 100% of the principal amount
redeemed plus interest accrued on the principal amount being redeemed to the date fixed for redemption.
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The Paying Agent and Registrar shall select the Term Bonds for mandatory redemption using any random
method of selection deemed appropriate by the Paying Agent and Registrar. The Series 2010 Bonds shall
be redeemed only in amounts of $5,000 or integral multiples thereof. Any Series 2010 Bond redeemed in
part only shall be surrendered to said Paying Agent and Registrar in exchange for a new Series 2010 Bond
evidencing the unredeemed principal thereof. Notice of redemption of any Series 2010 Bond called for
redemption shall be given, at the direction of the City in the case of optional redemptions and without
further direction in the case of mandatory redemptions, by said Paying Agent and Registrar by mail not
less than 30 days prior to the date fixed for redemption, first class, postage prepaid, sent to the registered
owner of such Series 2010 Bond at said owner's registered address. Such notice shall designate the Series
2010 Bond or Series 2010 Bonds to be redeemed by maturity or otherwise, the date of original issue and
the date fixed for redemption and shall state that such Series 2010 Bond or Series 2010 Bonds are to be
presented for prepayment at the office of said Paying Agent and Registrar. In case of any Series 2010
Bond partially redeemed, such notice shall specify the portion of the principal amount of such bond to be
redeemed. No defect in the mailing of notice for any Series 2010 Bond shall affect the sufficiency of the
proceedings of the City designating the Series 2010 Bonds called for redemption or the effectiveness of
such call for Series 2010 Bonds for which notice by mail has been properly given and the City shall have
the right to further direct notice of redemption for any such Series 2010 Bond for which defective notice
has been given.
Section 7. If the date for payment of the principal of or interest on the Series 2010 Bonds shall be
a Saturday, Sunday, legal holiday or a day on which banking institutions in the City of Blair, Nebraska, are
authorized by law or executive order to close, then the date for such payment shall be the next succeeding
day which is not a Saturday, Sunday, legal holiday or a day on which such banking institutions are
authorized to close, and payment on such day shall have the same force and effect as if made on the
nominal date of payment.
Section 8. The Series 2010 Bonds shall be in substantially the following form:
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Interest Rate Maturity Date
Registered Owner:
Principal Amount:
October 1,
UNITED STATES OF AMERICA
STATE OF NEBRASKA
COUNTY OF WASHINGTON
CITY OF BLAIR
SEWER SYSTEM REVENUE BOND
SERIES 2010
No. $
KNOW ALL PERSONS BY THESE PRESENTS: That the City of Blair, in the County of
Washington, in the State of Nebraska, hereby acknowledges itself to owe and for value received promises
to pay, but only from the special sources hereinafter described, to the registered owner specified above, or
registered assigns, the principal amount specified above in lawful money of the United States of America
on the date of maturity specified above with interest thereon to maturity (or earlier redemption) from the
date of original issue or most recent Interest Payment Date, whichever is later, at the rate per annum
specified above, payable semiannually on April 1 and October 1 of each year commencing April 1, 2011
(each, an "Interest Payment Date "). Such interest shall be computed on the basis of a 360 -day year
consisting of twelve 30 day months. The principal of this bond together with interest thereon unpaid and
accrued at maturity (or earlier redemption) is payable upon presentation and surrender of this bond at the
office of the Treasurer of the City of Blair, Nebraska, as Paying Agent and Registrar, in Blair, Nebraska.
Interest on this bond due prior to maturity or earlier redemption will be paid on each Interest Payment Date
by a check or draft mailed by the Paying Agent and Registrar to the registered owner of this bond, as
shown on the books of record maintained by the Paying Agent and Registrar, at the close of business on
the fifteenth day of the month immediately preceding the month in which the Interest Payment Date
occurs, to such owner's address as shown on such books and records. Any interest not so timely paid shall
cease to be payable to the person entitled thereto as of the record date such interest was payable, and shall
be payable to the person who is the registered owner of this bond (or of one or more predecessor bonds
hereto) on such special record date for payment of such defaulted interest as shall be fixed by the Paying
Agent and Registrar whenever monies for such purpose become available.
This bond is one of an issue of fully registered bonds of the total principal amount of One Million
Six Hundred Forty -five Thousand Dollars ($1,645,000) of even date and like tenor, except as of the date of
maturity, rate of interest and denomination, (the "Series 2010 Bonds ") which were issued by the City for
the purpose of paying the costs of constructing additions to and improving, extending and equipping the
sanitary sewer system and sewage disposal plant of the City of Blair, Nebraska, and is issued pursuant to
the terms of an ordinance (the "Ordinance ") passed and approved by the Mayor and Council of said City in
accordance with and under the provisions of Sections 18 -1803 to 18 -1805, R.R.S. Neb. 2007.
Any or all of the bonds of said issue maturing on or after October 1, 2015, are subject to
redemption at the option of the City, in whole or in part, on or after the fifth anniversary of the date of
original issue thereof, or at any time thereafter, at par together with accrued interest on the principal
amount redeemed to the date fixed for redemption. Such optional redemption shall be made from time to
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Date of
Original Issue
CUSIP NUMBER
time as shall be directed by the Mayor and Council of the City. The City may select the Series 2010 Bonds
for optional redemption in its sole discretion.
The Series 2010 Bonds maturing on October 1, 2030 (the "Term Bonds ") are required to be
redeemed prior to their stated maturity, commencing on October 1, 2026, and continuing on October 1 of
each year thereafter, in part, which redemptions shall be in the years and for the principal amounts set forth
below:
Year of Redemption Amount Required to be Redeemed
2026 $120,000
2027 125,000
2028 130,000
2029 135,000
2030 (final maturity) 305,000
Such mandatory redemptions shall be at a price equal to 100% of the principal amount redeemed plus
interest accrued on the principal amount being redeemed to the date fixed for redemption. The Paying
Agent and Registrar shall select the Term Bonds for mandatory redemption using any random method of
selection deemed appropriate by the Paying Agent and Registrar.
Notice of any redemption shall be given by mail, sent to the registered owner of any bond called
for redemption at said registered owner's address in the manner provided in the resolution authorizing said
bonds. Individual bonds may be redeemed in part but only in $5,000 amounts or integral multiples thereof.
This bond is transferable by the registered owner or such owner's attorney duly authorized in
writing at the office of the Paying Agent and Registrar upon surrender and cancellation of this bond, and
thereupon a new bond or bonds of the same aggregate principal amount, interest rate and maturity will be
issued to the transferee as provided in the Ordinance, subject to the limitations therein prescribed. The
City, the Paying Agent and Registrar and any other person may treat the person in whose name this bond is
registered as the absolute owner hereof for the purpose of receiving payment due hereunder and for all
other purposes and shall not be affected by any notice to the contrary, whether this bond be overdue or not.
If the day for payment of the principal of or interest on this bond shall be a Saturday, Sunday, legal
holiday or a day on which banking institutions in the City of Blair, Nebraska, are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which is not a
Saturday, Sunday, legal holiday or a day on which such banking institutions are authorized to close, and
payment on such date shall have the same force and effect as if made on the nominal date of payment.
The revenues and earnings of the wastewater treatment plant and sanitary sewer system of the City
of Blair, Nebraska, including all improvements and additions thereto hereafter constructed or acquired,
(the "Sewer System ") are pledged and hypothecated by the City for the payment of this bond and the other
Series 2010 Bonds and for the payment of the City's Sewer System Revenue Refunding Bonds, Series
2004, outstanding in the principal amount of $625,000, and any additional bonds of equal priority issued in
accordance with the terms of the Ordinance. The Series 2010 Bonds are a lien only upon said revenues
and earnings and are not general obligations of the City of Blair, Nebraska.
The Ordinance sets forth the covenants and obligations of the City with respect to the Sewer
System and the applications of the revenues and earnings thereof, which revenues and earnings under the
terms of the Ordinance are required to be deposited to the "Blair Sewer System Fund" (as maintained in
the Ordinance) and disbursed to pay costs of operation and maintenance of the Sewer System, make
payments of principal and interest on the Series 2010 Bonds, the Series 2004 Bonds and any additional
bonds of equal priority with the Series 2010 Bonds and Series 2004 Bonds and other payments as specified
in the Ordinance. The Ordinance also designates the terms and conditions under which additional bonds
of equal priority with the Series 2010 Bonds and the Series 2004 Bonds may be issued. The Ordinance
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also designates the terms and conditions upon which this bond shall cease to be entitled to any lien, benefit
or security under such Ordinance and all covenants, agreements and obligations of the City under the
Ordinance may be discharged and satisfied at or prior to the maturity or redemption of this bond if monies
or certain specified securities shall have been deposited with a trustee bank. In the Ordinance the City also
reserves the right to issue bonds or notes junior in lien to Series 2010 Bonds, the Series 2004 Bonds and
additional bonds of equal priority to the Series 2010 Bonds and the Series 2004 Bonds, the principal and
interest of which shall be payable from monies in the "Surplus Account" of the Blair Sewer System Fund
as described in the Ordinance.
IT IS HEREBY CERTIED AND WARRANTED that all conditions, acts and things required by
law to exist or to be done precedent to and in the issuance of this bond did exist, did happen and were done
and performed in regular and due form and time as provided by law.
AS PROVIDED IN THE ORDINANCE REFERRED TO HEREIN, UNTIL THE
TERMINATION OF THE SYSTEM OF BOOK - ENTRY -ONLY TRANSFERS THROUGH THE
DEPOSITORY TRUST COMPANY, NEW YORK, NEW YORK (TOGETHER WITH ANY
SUCCESSOR SECURITIES DEPOSITORY APPOINTED PURSUANT TO THE ORDINANCE,
"DTC "), AND NOTWITHSTANDING ANY OTHER PROVISIONS OF THE ORDINANCE TO THE
CONTRARY, A PORTION OF THE PRINCIPAL AMOUNT OF THIS BOND MAY BE PAID OR
REDEEMED WITHOUT SURRENDER HEREOF TO THE PAYING AGENT AND REGISTRAR.
DTC OR A NOMINEE, TRANSFEREE OR ASSIGNEE OF DTC OF THIS BOND MAY NOT RELY
UPON THE PRINCIPAL AMOUNT INDICATED HEREON AS THE PRINCIPAL AMOUNT HEREOF
OUTSTANDING AND UNPAID. THE PRINCIPAL AMOUNT HEREOF OUTSTANDING AND
UNPAID SHALL FOR ALL PURPOSES BE THE AMOUNT DETERMINED IN THE MANNER
PROVIDED IN THE ORDINANCE.
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED OFFICER OF DTC (A) TO
THE PAYING AGENT AND REGISTRAR FOR REGISTRATION OF TRANSFER OR EXCHANGE
OR (B) TO THE PAYING AGENT AND REGISTRAR FOR PAYMENT OF PRINCIPAL, AND ANY
BOND ISSUED IN REPLACEMENT HEREOF OR SUBSTITUTION HEREOF IS REGISTERED IN
THE NAME OF DTC AND ANY PAYMENT IS MADE TO DTC OR ITS NOMINEE, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSONS IS WRONGFUL BECAUSE ONLY THE REGISTERED OWNER HEREOF, DTC OR ITS
NOMINEE, HAS AN INTEREST HEREIN.
This bond shall not be valid and binding on the City until authenticated by the Paying Agent and
Registrar.
IN WITNESS WHEREOF, the Mayor and Council of the City of Blair, Nebraska, have caused this
bond to be executed on behalf of the City with the facsimile signatures of the Mayor and City Clerk of the
City, all as of the Date of Original Issue shown above.
ATTEST:
(facsimile signature)
City Clerk
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CITY OF BLAIR, NEBRASKA
(facsimile signature)
Mayor
CERTIFICATE OF AUTHENTICATION
AND REGISTRATION
This bond is one of the series designated therein and has been registered to the owner named in
said bond and the name of such owner has been recorded in the books of record maintained by the
undersigned as Paying Agent and Registrar for said issue of bonds.
(FORM OF ASSIGNMENT)
For value received hereby sells, assigns, and transfers
unto the within bond and hereby irrevocably constitutes and
appoints , Attorney, to transfer the same on the books of registration
in the office of the within mentioned Paying Agent and Registrar with full power of substitution in the
premises.
Date:
City Treasurer,
Paying Agent and Registrar
for the City of Blair, Nebraska
Registered Owner
Signature Guaranteed
By
Authorized Officer
Note: The signature(s) on this assignment MUST CORRESPOND with the name(s) as written on
the face of the within bond in every particular, without alteration, enlargement or any change whatsoever,
and must be guaranteed by a commercial bank or a trust company or by a firm having membership on the
New York, Midwest or other stock exchange.
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Section 9. Each of the Series 2010 Bonds shall be executed on behalf of the City with the
facsimile signatures of the Mayor and the City Clerk and shall have imprinted thereon the City's seal. The
Series 2010 Bonds shall be issued initially as "book- entry- only" bonds under the services of The
Depository Trust Company (the "Depository "), with one typewritten bond per maturity being issued to the
Depository. In such connection said officers of the City are authorized to execute and deliver a Letter of
Representations (the "Letter of Representations ") in the form required by the Depository (which may be in
the form of a blanket letter, including any such letter previously executed and delivered), for and on behalf
of the City, which shall thereafter govern matters with respect to registration, transfer, payment and
redemption of the Series 2010 Bonds. With respect to the issuance of the Series 2010 Bonds as
"book- entry- only" bonds, the following provisions shall apply:
(a) The City and the Paying Agent and Registrar shall have no responsibility or
obligation to any broker - dealer, bank or other financial institution for which the Depository
holds Series 2010 Bonds as securities depository (each, a "Bond Participant ") or to any
person who is an actual purchaser of a Series 2010 Bond from a Bond Participant while the
Series 2010 Bonds are in book -entry form (each, a "Beneficial Owner ") with respect to the
following:
(i) the accuracy of the records of the Depository, any nominees of
the Depository or any Bond Participant with respect to any ownership
interest in the Series 2010 Bonds,
(ii) the delivery to any Bond Participant, any Beneficial Owner or
any other person, other than the Depository, of any notice with respect to
the Series 2010 Bonds, including any notice of redemption, or
(iii) the payment to any Bond Participant, any Beneficial Owner
or any other person, other than the Depository, of any amount with respect
to the Series 2010 Bonds. The Paying Agent and Registrar shall make
payments with respect to the Series 2010 Bonds only to or upon the order
of the Depository or its nominee, and all such payments shall be valid and
effective fully to satisfy and discharge the obligations with respect to such
Series 2010 Bonds to the extent of the sum or sums so paid. No person
other than the Depository shall receive an authenticated Bond, except as
provided in (e) below.
(b) Upon receipt by the Paying Agent and Registrar of written notice from the
Depository to the effect that the Depository is unable or unwilling to discharge its
responsibilities, the Paying Agent and Registrar shall issue, transfer and exchange Series
2010 Bonds requested by the Depository in appropriate amounts. Whenever the
Depository requests the Paying Agent and Registrar to do so, the Paying Agent and
Registrar will cooperate with the Depository in taking appropriate action after reasonable
notice (i) to arrange, with the prior written consent of the City, for a substitute depository
willing and able upon reasonable and customary terms to maintain custody of the Series
2010 Bonds or (ii) to make available Series 2010 Bonds registered in whatever name or
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names as the Beneficial Owners transferring or exchanging such Series 2010 Bonds shall
designate.
(c) If the City determines that it is desirable that certificates representing the
Series 2010 Bonds be delivered to the ultimate beneficial owners of the Series 2010
Bonds and so notifies the Paying Agent and Registrar in writing, the Paying Agent and
Registrar shall so notify the Depository, whereupon the Depository will notify the Bond
Participants of the availability through the Depository of bond certificates representing
the Series 2010 Bonds. In such event, the Paying Agent and Registrar shall issue,
transfer and exchange bond certificates representing the Series 2010 Bonds as requested
by the Depository in appropriate amounts and in authorized denominations.
(d) Notwithstanding any other provision of this Ordinance to the contrary, so
long as any Series 2010 Bond is registered in the name of the Depository or any nominee
thereof, all payments with respect to such Series 2010 Bond and all notices with respect
to such Series 2010 Bond shall be made and given, respectively, to the Depository as
provided in the Letter of Representations.
(e) Registered ownership of the Series 2010 Bonds may be transferred on the
books of registration maintained by the Paying Agent and Registrar, and the Series 2010
Bonds may be delivered in physical form to the following:
(i) any successor securities depository or its nominee;
(ii) any person, upon (A) the resignation of the
Depository from its functions as depository or (B) termination of
the use of the Depository pursuant to this Section.
(f) In the event of any partial redemption of a Series 2010 Bond unless and until
such partially redeemed bond has been replaced in accordance with the provisions of this
Ordinance, the books and records of the Paying Agent and Registrar shall govern and
establish the principal amount of such bond as is then outstanding and all of the Series
2010 Bonds issued to the Depository or its nominee shall contain a legend to such effect.
If for any reason the Depository is terminated or resigns and is not replaced, or upon termination by the
City of book -entry -only form, the City shall immediately provide a supply of printed bond certificates for
issuance upon the transfers from the Depository and subsequent transfers or in the event of partial
redemption. In the event that such supply of certificates shall be insufficient to meet the requirements of
the Paying Agent and Registrar for issuance of replacement bond certificates upon transfer or partial
redemption, the City agrees to order printed an additional supply of bond certificates and to direct their
execution by manual or facsimile signatures of its then duly qualified and acting officers. In case any
officer whose signature or facsimile thereof shall appear on any Series 2010 Bond shall cease to be such
officer before the delivery of such bond (including such certificates delivered to the Paying Agent and
Registrar for issuance upon transfer or partial redemption), such signature or such facsimile signature
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shall nevertheless be valid and sufficient for all purposes the same as if such officer or officers had
remained in office until the delivery of the Series 2010 Bond. The Series 2010 Bonds shall not be valid
and binding on the City until authenticated by the Paying Agent and Registrar. The Series 2010 Bonds
shall be delivered to the Paying Agent and Registrar for registration and authentication. Upon execution,
registration, and authentication of the Series 2010 Bonds, they shall be delivered to the City Treasurer,
acting on behalf of the City, who is authorized to deliver them to Ameritas Investment Corp., as initial
purchaser thereof. The Series 2010 Bonds are hereby sold to said purchaser for the sum of $1,624,437.50,
plus accrued interest thereon, if any, to date of payment for the Series 2010 Bonds. Such purchaser and
its agents, representatives and counsel (including the City's bond counsel) are hereby authorized to take
such actions on behalf of the City as are necessary to effectuate the closing of the issuance and sale of the
Series 2010 Bonds, including without limitation, authorizing the release of the Series 2010 Bonds by the
Depository at closing. The officers of the City (or any one of them) are hereby authorized to execute and
deliver the Bond Purchase Agreement for and on behalf of the City. Said initial purchaser shall have the
right to direct the registration of the Series 2010 Bonds and the denominations thereof within each
maturity, subject to the restrictions of this Ordinance. The City Clerk shall make and certify a transcript of
the proceedings of the Mayor and Council with respect to the Series 2010 Bonds which shall be delivered
to said purchaser.
Section 10. Accrued interest, if any, received from the sale of the Series 2010 Bonds shall be
applied to pay interest falling due on April 1, 2011, and shall be credited to the Bond Payment Account as
described in Section 11 hereof. Expenses of issuance of the Series 2010 Bonds may be paid from the
proceeds of the Series 2010 Bonds. $164,500.00 from proceeds of the Series 2010 Bonds shall be
deposited to the Debt Service Reserve Account, for credit to the sub - account for the Series 2010 Bonds.
The balance of proceeds of the Series 2010 Bonds shall be applied without further direction to the
payment on August 17, 2010, of the principal and interest on the Sewer Revenue Bond Anticipation
Notes, Series 2007, of the City related to improvements to the Sewer System which are being refinanced
by the Series 2010 Bonds, with any remaining funds to be applied to further improvements to the Sewer
System.
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Section 11. The revenues and earnings of the Sewer System are hereby pledged and
hypothecated for the payment of the Series 2010 Bonds, the Series 2004 Bonds and any Additional Bonds
as authorized by this Ordinance and interest on such Series 2010 Bonds, Series 2004 Bonds and
Additional Bonds and the City does hereby agree with the holders of said Series 2010 Bonds, Series 2004
Bonds and Additional Bonds as follows:
(a) BLAIR SEWER SYSTEM FUND - The entire gross revenues and
income derived from the operation of the Sewer System shall be set aside as collected
and deposited in a separate fund previously established and designated as the "Blair
Sewer System Fund." For purposes of allocating the monies in the Blair Sewer System
Fund, the City shall maintain the following accounts: (1) Operation and Maintenance
Account; (2) Bond Payment Account; (3) Debt Service Reserve Account; and (4)
Surplus Account.
(b) OPERATION AND MAINTENANCE ACCOUNT - Out of the Blair
Sewer System Fund there shall be monthly credited into the Operation and Maintenance
Account such amounts as the City shall from time to time determine to be necessary to
pay the reasonable and necessary expenses of operating and maintaining the Sewer
System and the City may withdraw funds credited to the Operation and Maintenance
Account as necessary from time to time to pay such expenses.
(c) BOND PAYMENT ACCOUNT - Out of the Blair Sewer System Fund
there shall be credited monthly on or before the fifteenth day of each month to the Bond
Payment Account, starting with the month of September 2010, the following amounts:
(1) Beginning September 15, 2010, and continuing for the period
from September 15, 2010 through and including March 15, 2011,
an amount equal to 1 /7th of the next maturing interest payment
on the Series 2010 Bonds;
(2) Beginning April 15, 2011, and continuing for the period from
April15, 2011 so long as the Series 2010 Bonds remain
outstanding, an amount equal to 1/6th of the next maturing
semiannual interest payment on the Series 2010 Bonds;
(3)
Beginning October 15, 2016 and continuing so long as the Series
2010 Bonds remain outstanding, an amount equal to 1 /12th of
the next maturing principal payment (whether by stated maturity
or by mandatory redemption) on the Series 2010 Bonds; and
(4) during such periods, such amounts as are required to be credited
under the terms of Ordinance No. 2017, for payments of
principal and interest on the Series 2004 Bonds.
The City Treasurer is hereby authorized and directed, without further authorization, to
withdraw monies credited to the Bond Payment Account, or if the monies in such
Account are insufficient, then from the Debt Service Reserve Account (but only from the
designated sub - account for the specific issue) and next from the Surplus Account, an
amount sufficient to pay, when due, the principal of and interest on the Series 2010
Bonds, the Series 2004 Bonds or any Additional Bonds and to transfer such amounts due
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to the Paying Agent and Registrar (or other paying agent for Additional Bonds), at least
five (5) business days before each principal and interest payment date. Upon the issuance
of any Additional Bonds pursuant to this Ordinance, appropriate additional credits to the
Bond Payment Account shall be provided for sufficient to pay principal and interest on
said Additional Bonds.
(d) DEBT SERVICE RESERVE ACCOUNT - The City agrees that it
shall deposit from the proceeds of the Series 2010 Bonds the amount specified in Section
10 of this Ordinance as the amount required to be maintained attributable to the Series
2010 Bonds in a separate sub - account which is hereby established for the Series 2010
Bonds in the Debt Service Reserve Account and such specified amount shall constitute
the required reserve amount for such sub - account. Monies credited to the Debt Service
Reserve Account may be withdrawn, but only from the designated sub - account for a
specific issue, as needed, to provide funds to pay, when due, the principal of and interest
on the Series 2010 Bonds, the Series 2004 Bonds and any Additional Bonds issued
pursuant to this Ordinance, as the case may be, if the Bond Payment Account contains
insufficient funds for that purpose, and the City Treasurer is hereby authorized and
directed to make such withdrawal if and when needed. In the event of a withdrawal from
the Debt Service Reserve Account, there shall be credited to the Debt Service Reserve
Account in the month following such withdrawal all monies in the Blair Sewer System
Fund remaining after making the payments required to be made in such month to the
Operation and Maintenance Account and Bond Payment Account and each month
thereafter all such remaining monies shall be credited to the Debt Service Reserve
Account until such account has been restored to the required balance. Upon the issuance
of any Additional Bonds, the amount required to be accumulated and maintained in the
Debt Service Reserve Account, in a separate sub - account for each such issue of
Additional Bonds, shall be set at an amount equal to the Average Annual Debt Service
Requirements on the proposed issue of Additional Bonds or such greater or lesser amount
(which may be $ -0 -), if any as determined appropriate by the Mayor and Council in
connection with any such issue of Additional Bonds. Any such required increase shall be
provided for either by credit made from bond proceeds or current funds of the Sewer
System then available or by equal monthly credits from the Blair Sewer System Fund
made in such amounts so that the required amount shall be accumulated in a period of not
more than five years. Each sub - account in the Debt Service Reserve Account shall be
held solely for the specific issue for which it is established. In the event of withdrawal
from any such sub - account which results in the amount in such sub - account being
deficient to meet the required balance, available amounts for restoring sub - account
balances shall be credited to each deficient sub - account on a pro rata basis in accordance
with the respective outstanding principal amounts for those issues for which the
respective sub - accounts are then deficient. When the Series 2010 Bonds, the Series 2004
Bonds or any issue of Additional Bonds for which a sub - account has been established is
no longer outstanding, the particular sub - account for such issue shall no longer be
required to be maintained. Anything in this subsection 11(d) to the contrary
notwithstanding, the amount required to be maintained in the Debt Service Reserve
Account with respect to the Series 2010 Bonds, the Series 2004 Bonds or any issue of
Additional Bonds shall not at any time exceed the maximum amount permitted to be
invested without yield restriction under Sections 103(b) and 148 of the Internal Revenue
Code of 1986, as amended, and applicable regulations of the United States Treasury
Department.
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(e) SURPLUS ACCOUNT - Monies in the Blair Sewer System Fund
remaining after the credits required in the foregoing Subsections 11(b), 11(c), and 11(d)
shall be credited to the Surplus Account. Monies in the Surplus Account may be used to
make up any deficiencies in any of the preceding Accounts, to retire any of the Series
2010 Bonds, the Series 2004 Bonds or any Additional Bonds prior to their maturity, to
pay principal of and interest on any junior lien indebtedness incurred with respect to the
Sewer System, to provide for replacements or improvements for the Sewer System or to
provide for any other lawful purpose of the City (including payments in lieu of taxes or
interfund transfers) as directed by the Mayor and City Council.
The provisions of this Section shall require the City to maintain a set of books and records in accordance
with such accounting methods and procedures as are generally applicable to municipal utility enterprises,
which books and records shall show credits to and expenditures from the several Accounts required by
this Section. Monies credited to the Blair Sewer System Fund or any of the Accounts therein as
established by this Ordinance shall be deposited or invested separate and apart from other City funds.
Except as specified below for the Debt Service Reserve Account, the City shall not be required to
establish separate bank or investment accounts for the Accounts described in Subsections 11(b), 11(c),
11(d), and 11(e). Monies credited to the Debt Service Reserve Account shall, if maintained in a demand
or time deposit account, be kept in a separate account and not commingled with other Sewer System
funds or accounts. If invested, monies credited to the Debt Service Reserve Account may be commingled
with other Sewer System funds or accounts so long as the City maintains books and records clearly
identifying the specific investments, or portions thereof, which belong to the Debt Service Reserve
Account and the respective sub - accounts therein.
Monies in any of said Accounts except the Debt Service Reserve Account may be invested in
investments permissible for a city of the first class. Monies in the Debt Service Reserve Account may be
invested in Deposit Securities. Monies invested from the Debt Service Reserve Account shall be invested
to mature in not more than five years. Investments held for the Debt Service Reserve Account will be
valued at cost for purposes of determining compliance with the requirements of this Ordinance as to the
amount required to be maintained in the Debt Service Reserve Account or any sub - account therein.
Income from or profit realized from investments for any Account or any sub - account shall be credited to
such Account or sub - account until such Account or sub - account contains any amount then required to be
therein, and thereafter such income or profit shall be transferred to the Blair Sewer System Fund and
treated as other revenues from the operation of the Sewer System. The ordinance authorizing any series
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of Additional Bonds for which a debt service reserve sub - account is to be established shall establish the
terms for investment related to such sub - account.
The pledge and hypothecation provided for the Series 2010 Bonds, the Series 2004 Bonds and
any Additional Bonds in this Ordinance is intended to constitute and shall provide for a first and prior
pledge and lien upon and security interest in the revenues and earnings of the Sewer System superior to
any pledge, lien or security interest made or given with respect to any other indebtedness of the City as to
its Sewer System and is intended as a full exercise of the powers of the City provided for in Sections 18-
1803 to 18 -1805, R.R.S. Neb. 2007, as now or hereafter amended, with respect to the City's Sewer
System and the revenues and earnings thereof.
Section 12. So long as any of the Series 2010 Bonds, Series 2004 Bonds and any Additional
Bonds issued pursuant to this Ordinance shall remain outstanding and unpaid, the City covenants and
agrees to establish, revise, from time to time as necessary, and collect such rates and charges for the
service furnished from the Sewer System adequate to produce revenues and earnings sufficient at all
times:
(a) To provide funds to pay, when due, the principal of and interest on the Series
2010 Bonds, the Series 2004 Bonds and any Additional Bonds issued pursuant to this
Ordinance.
(b) To pay all proper and necessary costs of operation and maintenance of the
Sewer System and to pay for the necessary and proper repairs, replacements,
enlargements, extensions and improvements to the Sewer System.
(c) To provide funds sufficient to make the credits into the Accounts and at the
times and in the amounts required by Section 11 of this Ordinance.
(d) To maintain Net Revenues in each fiscal year adopted by the City for the
Sewer System in an amount not less than 1.25 times the total amount of principal paid or
payable (exclusive of any principal redeemed prior to maturity other than principal
redeemed pursuant to a schedule of mandatory redemptions) and interest falling due
during such fiscal year on the Series 2010 Bonds, the Series 2004 Bonds and any
Additional Bonds.
Section 13. To provide funds for any purpose related to the Sewer System, the City may issue
Additional Bonds, except for Additional Bonds issued for refunding purposes which are governed by
Section 14 of this Ordinance, payable from the revenues of the Sewer System having equal priority and
on a parity with the Series 2010 Bonds, the Series 2004 Bonds and any Additional Bonds then
outstanding, only upon compliance with the following conditions:
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(a) Such Additional Bonds shall be issued only pursuant to an ordinance which
shall provide for an increase in the monthly credits into the Bond Payment Account in
amounts sufficient to pay, when due, the principal of and interest on the Series 2010
Bonds, the Series 2004 Bonds, any Additional Bonds then outstanding and the proposed
Additional Bonds and for any monthly credits to the Debt Service Reserve Account as are
required under Subsection 11(d).
(b) The City shall have complied with one or the other of the two following
requirements:
1) The Net Revenues derived by the City from its Sewer System for
the fiscal year next preceding the issuance of the Additional
Bonds (determined in accordance with the definition of such
term set forth in Section 2(d), including, if applicable, a
determination made for any period when financial statements
have not yet been completed and reported on) shall have been at
least equal to 1.25 times the Average Annual Debt Service
Requirements of the Series 2010 Bonds, the Series 2004 Bonds
and any Additional Bonds, all as then outstanding, and of the
proposed Additional Bonds; or
2) The City shall have received a projection made by a consulting
engineer or firm of consulting engineers, recognized as having
experience and expertise in municipal utility systems, projecting
that the Net Revenues of the Sewer System in each of the three
full fiscal years after the issuance of such Additional Bonds will
be at least equal to 1.25 times the Average Annual Debt Service
Requirements of the Series 2010 Bonds, the Series 2004 Bonds
and any Additional Bonds, all as then outstanding, and of the
proposed Additional Bonds. In making such projection, the
consulting engineer shall use as a basis the Net Revenues of the
Sewer System during the last fiscal year for which an
independent audit has been prepared and shall adjust such Net
Revenues as follows: (A) to reflect changes in rates which have
gone into effect since the beginning of the year for which the
audit was made, (B) to reflect such engineer's estimate of the net
increase over or net decrease under the Net Revenues of the
Sewer System for the year for which the audit was made by
reason of: (i) changes of amounts payable under existing
contracts for services; (ii) additional general income from sales
to customers under existing rate schedules for various classes of
customers or as such schedules may be revised under a program
of changes which has been adopted by the Mayor and Council of
the City; (iii) projected revisions in costs for labor, wages,
salaries, machinery, equipment, supplies and other operational
items; (iv) revisions in the amount of service to be supplied and
any related administrative or other costs associated with such
increases due to increased supply from the acquisition of any
new facility; and (v) such other factors affecting the projections
of revenues and expenses as the consulting engineer deems
reasonable and proper. Annual debt service on any proposed
Additional Bonds to be issued may be estimated by the
consulting engineer in projecting Average Annual Debt Service
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Requirements, but no Additional Bonds shall be issued requiring
any annual debt service payment in excess of the amount so
estimated by the consulting engineer.
The City hereby covenants and agrees that so long as any of the Series 2010 Bonds, the Series
2004 Bonds and any Additional Bonds are outstanding, it will not issue any bonds or notes payable from
the revenues of the Sewer System except in accordance with the provisions of this Ordinance, provided,
however, the City reserves the right to issue bonds or notes which are junior in lien to the Series 2010
Bonds, the Series 2004 Bonds and any such Additional Bonds with the principal and interest of such
bonds or notes to be payable from monies credited to the Surplus Account as provided in Subsection
11(e).
Section 14. The City may issue refunding bonds which shall qualify as Additional Bonds of
equal lien to refund any Series 2010 Bonds, Series 2004 Bonds or Additional Bonds then outstanding,
provided, that if any such Series 2010 Bonds, Series 2004 Bonds or Additional Bonds are to remain
outstanding after the issuance of such refunding bonds, the principal payments due in any calendar year in
which those bonds which are to remain outstanding mature, or in any calendar year prior thereto, shall not
be increased over the amount of such principal payments due in such calendar years immediately prior to
such refunding. Refunding bonds issued in accordance with this paragraph of this Section 14 may be
issued as Additional Bonds of equal lien without compliance with the conditions set forth in Subsection
13 (b) of this Ordinance.
The City may also issue refunding bonds which shall qualify as Additional Bonds of equal lien to
refund any Series 2010 Bonds, Series 2004 Bonds or Additional Bonds then outstanding provided, that, if
any such Series 2010 Bonds, Series 2004 Bonds or Additional Bonds are to remain outstanding after the
application of the proceeds of the refunding bonds to the payment of the bonds which are to be refunded,
such issuance must comply with the Net Revenues test set forth in Subsection 13(b)(1) of this Ordinance
and, if the proceeds of such refunding bonds are not to be applied immediately to the satisfaction of the
bonds which are to be refunded, then such refunding bonds must provide by their terms that they shall be
junior in lien to all Series 2010 Bonds, Series 2004 Bonds and any Additional Bonds outstanding at the
time of issuance of such refunding bonds until the time of application of their proceeds to the satisfaction
of the bonds which are to be refunded. In computing Average Annual Debt Service Requirements to
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show compliance with said Net Revenues test for such refunding bonds, all payments of principal and
interest due on such refunding bonds from the time of their issuance to the time of application of the
proceeds of such refunding bonds to the satisfaction of the bonds which are to be refunded shall be
excluded from such computation to the extent that such principal and interest are payable from sources
other than the revenues of the Sewer System (such as bond proceeds held in escrow or investment
earnings thereon) or from monies in the Surplus Account, and all payments of principal and interest due
on the bonds which are to be refunded from and after the time of such application shall also be excluded.
For purposes of this paragraph of this Section 14, the time of application of the proceeds of the refunding
bonds to the satisfaction of the bonds which are to be refunded shall be the time of deposit with the
paying agent for such bonds which are to be refunded pursuant to Section 10 -126 R.R.S. Neb. 2007 (or
any successor statutory provision thereto) or the time when such bonds which are to be refunded under
the terms of their authorizing ordinance or ordinances are no longer deemed to be outstanding, whichever
occurs sooner.
Section 15. So long as any Series 2010 Bonds, Series 2004 Bonds or Additional Bonds are
outstanding, the City hereby covenants and agrees as follows:
(a) The City will maintain the Sewer System in good condition and will
continuously operate the same in a reasonable and efficient manner, and the City will
punctually perform all the duties with reference to said system required by the
Constitution and statutes of the State of Nebraska, but this covenant shall not prevent the
City from discontinuing the use and operation of all or any portion of the Sewer System
so long as the revenues derived from the City's ownership of the properties constituting
the Sewer System shall be sufficient to fulfill this City's obligations under Sections 11
and 12 of this Ordinance.
(b) The City will not grant any franchise or right to any person, firm or
corporation to own or operate a utility system or systems in competition with the Sewer
System.
(c) The City will maintain insurance on the property constituting the Sewer
System (other than such portions of the system as are not normally insured) against risks
customarily carried by similar utilities, but including fire and extended coverage
insurance in an amount which would enable the City to repair, restore or replace the
property damaged to the extent necessary to make the Sewer System operable in an
efficient and proper manner to carry out the City's obligations under this Ordinance. The
Mayor and Council shall annually, after the end of each fiscal year adopted by the City
for the Sewer System, examine the amount of insurance carried with respect to the Sewer
System and shall evidence approval of such insurance by resolution. The proceeds of any
such insurance received by the City shall be used to repair, replace or restore the property
damaged or destroyed to the extent necessary to make the Sewer System operable in an
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efficient and proper manner, and any amount of insurance proceeds not so used shall be
credited to the Surplus Account. In the event of any such insured casualty loss, the City
may advance funds to make temporary repairs or provide for an advance on costs of the
permanent repair, restoration or replacement from the Operation and Maintenance
Account and any such advances shall be repaid from insurance proceeds received.
(d) The City will keep proper books, records, and accounts separate from all
other records and accounts in which complete and correct entries will be made of all
transactions relating to the Sewer System. The City will have its operating and financial
statements relating to the Sewer System audited annually by a certified public accountant
or firm of certified public accountants. The City will furnish to the original purchaser of
the Series 2010 Bonds and to the original purchaser or purchasers of each series of
Additional Bonds issued hereunder, within six months after the end of each fiscal year of
the Sewer System, a copy of the financial statements of the Sewer System and the report
thereon of the certified public accountants.
(e) The City shall cause each person handling any of the monies in the Blair
Sewer System Fund to be bonded by an insurance company licensed to do business in
Nebraska in an amount or amounts deemed sufficient by the Mayor and Council to cover
the amount of money belonging to said system reasonably expected to be in the
possession or control of such person. The amount of such bond or bonds shall be fixed
by the Mayor and Council and the costs thereof shall be paid as an operating and
maintenance expense from the Operation and Maintenance Account.
Section 16. The City's obligations under this Ordinance and the liens, pledges, covenants and
agreements of the City herein made or provided for, shall be fully discharged and satisfied as to the Series
2010 Bonds issued pursuant to this Ordinance and any such bonds shall no longer be deemed outstanding
hereunder if such bonds shall have been purchased and cancelled by the City, or when payment of the
principal of and interest thereon to the respective date of maturity or redemption (a) shall have been made
or caused to be made in accordance with the terms thereof, or (b) shall have been provided for by
depositing with a national or state bank having trust powers or trust company, in trust solely for such
payment, (i) sufficient money to make such payment and /or (ii) Deposit Securities in such amount and
bearing interest payable and maturing or redeemable at stated fixed prices at the option of the holder as to
principal, at such time or times, as will ensure the availability of sufficient money to make such payment;
provided, however, that, with respect to any Series 2010 Bond to be paid prior to maturity, the City shall
have duly given notice of redemption of such bond as provided by law or made irrevocable provisions for
the giving of such notice. Any such money so deposited with a bank or trust company may be invested
and reinvested in Deposit Securities and all interest and income from such Deposit Securities in the hands
of such bank or trust company, in excess of the amount required to pay principal of and interest on the
bonds for which such monies were deposited, shall be paid over to the City as and when collected.
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Section 17. The terms and provisions of this Ordinance do and shall constitute a contract
between the City and the registered owner or owners of the Series 2010 Bonds and no changes, variations
or alterations of any kind, except for changes necessary to cure any ambiguity, formal defect or omission,
shall be made to this Ordinance without the written consent of the registered owners of two- thirds (2 /3rds)
in principal amount of the Series 2010 Bonds then outstanding, provided, however, that neither the
principal and interest to be paid upon any Series 2010 Bond nor the maturity date of any Series 2010
Bond shall be changed without the written consent of the registered owners of all such bonds then
outstanding. Any registered owner of a Series 2010 Bond may by mandamus or other appropriate action
or proceedings at law or in equity in any court of competent jurisdiction enforce and compel performance
of this Ordinance and every provision and covenant hereof, including without limiting the generality of
the foregoing, the enforcement of the performance of all duties required of the City by this Ordinance and
the applicable laws of the State of Nebraska, including in such duties the collecting of revenues of the
Sewer System and the segregation and application of such revenues as described in Section 11 of this
Ordinance. After any default in payment or other default in performance, the registered owners of the
Series 2010 Bonds or any Additional Bonds shall be entitled to the appointment of a receiver for the
Sewer System. Any and all actions brought by any registered owner or owners of the Series 2010 Bonds
or Additional Bonds shall be maintained for the equal and ratable benefit of all registered owners of the
Series 2010 Bonds and Additional Bonds outstanding and no registered owners of any of the Series 2010
Bonds or Additional Bonds shall have any right in any manner whatsoever by any action or proceedings
to affect, disturb or prejudice the pledge created by this Ordinance.
Section 18. The Mayor and City Clerk and City Treasurer of the City are hereby authorized to do
all things and execute all documents as may by them be deemed necessary and proper to complete the
issuance and sale of the Series 2010 Bonds contemplated by this Ordinance. The Preliminary Official
Statement in the form presented is hereby approved and deemed final as of its date under the terms of
Reg. Sec. 240.15c2 -12 of the Rules of the Securities and Exchange Commission and such officers or any
one of them are further authorized to approve a final Official Statement on behalf of the City.
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Section 19. If any section, paragraph, clause or provision of this Ordinance shall be held invalid,
the invalidity of such section, paragraph, clause or provision shall not affect any of the other provisions of
this Ordinance.
Section 20. In accordance with the requirements of Rule 15c2 -12 (as now existing or as
subsequently amended, the "Rule ") promulgated by the Securities and Exchange Commission, the City
hereby agrees that it will provide the following continuing disclosure information:
(a) to the Municipal Securities Rulemaking Board (the "MSRB ") and to the Underwriter, the City
shall provide information generally consistent with the information set forth in the Management's
Discussion and Analysis contained in its audited financial statements, and its audited financial statements;
such information is expected to be available not later than seven months after the end of each fiscal year
for the City. Governmental and business -type activities in the government -wide financial statements and
the proprietary and fiduciary fund financial statements are to be presented on the accrual basis of
accounting and the governmental funds financial statements are presented on the modified accrual basis
of accounting in conformity with generally accepted accounting principles, subject to the City's discretion
to change accounting methods as and to the extent that it deems appropriate from time to time.
(b) in a timely manner to the MSRB, notice of the occurrence of any of the following events with
respect to the Series 2010 Bonds, if in the judgment of the City, such event is material:
(1) principal and interest payment delinquencies,
(2) non - payment related defaults,
(3) unscheduled draws on debt service reserves reflecting financial difficulties,
(4) unscheduled draws on credit enhancements reflecting financial difficulties
(there is no credit enhancement on the Series 2010 Bonds),
(5)
substitution of credit or liquidity providers, or their failure to perform (not
applicable to the Series 2010 Bonds),
(6) adverse tax opinions or events affecting the tax - exempt status of the Series
2010 Bonds,
(7) modifications to rights of the holders of the Series 2010 Bonds,
(8) bond calls,
(9) defeasances,
(10) release, substitution, or sale of property securing repayment of the Series 2010
Bonds, and
(11) rating changes (the Series 2010 Bonds are not rated and no rating for the Series
2010 Bonds is expected to be requested).
The City has not undertaken to provide notice of the occurrence of any other material event,
except the events listed above.
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(c) in a timely manner to the MSRB (as and to the extent required by the rule) notice of any failure on
the part of the City to provide required annual financial information not later than seven months after the
end of each fiscal year.
The City hereby agrees that all information required to be filed with the MSRB under the terms of its
continuing disclosure undertaking shall be provided for filing in such format and accompanied by such
identifying information as shall be prescribed by the MSRB. The City reserves the right to modify from
time to time the specific types of information provided or the format of the presentation of such
information, to the extent necessary or appropriate in the judgment of the City, consistent with the Rule.
The City hereby agrees that such covenants are for the benefit of the registered owners of the Series 2010
Bonds (including Beneficial Owners) and that such covenants may be enforced by any registered owner
or Beneficial Owner, provided that any such right to enforcement shall be limited to specific enforcement
of such undertaking and any failure shall not constitute an event of default under this Ordinance. The
continuing disclosure obligations of the City under this Ordinance, as described above, shall cease when
none of the Series 2010 Bonds remain outstanding.
Section 21. The City hereby covenants and agrees that it will make no use of the proceeds of the
Series 2010 Bonds which would cause the Series 2010 Bonds to be arbitrage bonds within the meaning of
Sections 103(b) and 148 of the Internal Revenue Code of 1986, as amended (the "Code "), and further
covenants to comply with said Sections 103(b) and 148 and all applicable regulations thereunder
throughout the term of said issue. The City hereby covenants and agrees to take all actions necessary
under the Code to maintain the tax exempt status of interest on the Series 2010 Bonds for federal income
tax purposes under the Code with respect to taxpayers generally. The City further agrees that it will not
take any actions which would cause the Series 2010 Bonds to constitute "private activity bonds" within
the meaning of Section 141 of the Code. The City hereby designates the Series 2010 Bonds as its
"qualified tax - exempt obligations" pursuant to Section 265(b)(3)(B)(i)(III) of the Code and covenants and
warrants that it does not reasonably expect to issue tax - exempt bonds or tax - exempt interest bearing
obligations aggregating in principal amount more than $30,000,000 during calendar 2010, excluding for
such purposes any and all "private activity bonds" issued by the City in such year within the meaning of
Section 141 of the Code other than "qualified 501(c)(3) bonds" as defined in Section 145 of the Code.
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Section 22. This Ordinance shall be in force and take effect from and after its passage and
approval as provided by law and shall be published in pamphlet form.
PASSED AND APPROVED this /3 day of e" , 2010.
ATTEST:
Ci' 'Clerk
SEAL
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