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April 15, 1976
MINUTES OF A REGULAR MEETING OF THE COUNCIL OF THE CITY OF WEST MEMPHIS, ARKANSAS, HAD AND HELD ON APRIL ]5, 1976. The City Council of the City of West Memphis, Arkansas met in regular session at its regular meeting place in West Memphis, Arkansas, at 1:30 o~clock p.m. on the 15th day of April, 1976. The following were present: Mayor Joyce Ferguson, City Attorney R. L. Smith, and Aldermen; R. T. Bentley, Thomas Dickerson, D. M. Grimsley, W. L. Harris, J. E. Hightower, A. 0. Holt, Pritchard Horton, J. C. King, and Tilden Rodgers. Absent: Alderman R. S. Cosgrove. Rev. John Barnes, Pastor of St. Michaels Catholic Church, gave the invocation. It being determined a quorum was present, the following proceedings were had to-wit: Motion was made by Alderman Harris, seconded by Alderman Dickerson, that approve Minutes of Council Meeting on April 1, 1976, included in the packet. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None . Alderman Cosgrove made a delayed appearance. Mayor Ferguson announced the next order of business would be opening of bids. Public Officials and Employe Legal Liability Insurance; Bid Notice published in the Evening Times on March 23rd and 30th. McCarley & Company - West Memphis Furnishings for Fire Station No. ~. Bid Notice published in the Evening Times on April 2nd and 9th. Crittenden Publishing Company - West Memphis Delta Appliance Service - West Memphis West Memphis Office Supplies - West Memphis Scott Kelly Furniture Company - West Memphis Motion was made by Alderman Holt, seconded by Alderman Grimsley, that refer bids for furnishings for Fire Station to the Fire Commission to reject or accept the bids , ~ Upon vote, the voting was as follows : (Amended May 6, 1976) Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None . Motion was made by Alderman Grimsley, seconded by Alderman Bentley, that refer one bid to the Insurance Committee for review. Upon vote, the voting was as follows: Aye: Aldermen; Bentley, Cosgrove, -Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay; None. Alderman Bentley presented the following recommendations of the Budget Committee: 1. Amend budget additional $3,000.00 for City audit to be divided between the City Administration and the three sub-departments of the Utility Department. Motion was made by Alderman Bentley, seconded by Alderman Holt, amend budget for additional $3,000.00. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay : None . l~ 2. Accept the City Audit for 1976. Motion was made by Alderman Bentley, seconded by Alderman Grimsley, that accept the City Audit as presented by the Auditor. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None. 3. Accept proposal of Bank of West Memphis on a daily interest checking account with a minimum balance of $50,000.00. After considering the follawing letter: BANK OF WEST MEMPHIS Jack K. Hogan President April 12, 1976 Honorable Joyce Ferguson, Mayor City of West Memphis City Hall West Memphis, AR 72301 Dear Joyce: We are writing in regard to the account of West Memphis Utilities which I understand is due to be rotated to our bank. We will 3~e happy to serve as depository far this checking account provided the city can see fit to keep a minimum balance of $50,000.00 in the account. We feel that this balance gill be necessary to compensate us for the high activity in the account. We would also be pleased to pay interest on surplus funds placed in a daily interest statement savings account. We would pay the maximum allowed on this type of account which is 5~ interest. We would not be in a position to handle telephone transfers into and out of either the savings or checking account. Withdrawals for either account would have to be signed by the City Treasurer. My suggestion would be for the City Treasurer to anticipate his needs on perhaps a weekly basis and make these transfers once a week in order to eliminate his coming to the bank every day to withdraw and transfer monies. If you see fit to place the account in our bank subject to the above requirements, we will be pleased to serve you. Cordially, /S/ JACK President ..-.~ .. ~~~ n Motion was made by Alderman Bentley, seconded by Alderman Holt, that accept proposal of Bank of West Memphis as per letter from the President of the Bank to the Mayor stating the agreement. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, and Hightower, Holt, Horton, King, and Rodgers. Nay: None. ~. Firemen be paid straight time for a declared emergency. After consideration, motion was made by Alderman Bentley, seconded by Alderman Grimsley, that firemen, be paid straight time during a declared emergency. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, and Hightower, Holt, Horton, King, and Rodgers. Nay : None . 5. No more longevity be paid past, present, or future for City employees. Alderman Bentley, seconded by Alderman Cosgrove, moved that no more longevity be paid past, present, or future for City employees. During discussion of the motion, Alderman Rodgers, seconded by Alderman King, moved call for the question. Upon roll call vote, the voting was as follows: A,ye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay : None . ~~ Roll call vote on the motion was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Holt, Horton, King, and Rodgers. Nay: Aldermen: Harris and Hightower. The motion carried. 6. Sign lease agreement with East Arkansas Community College for use of Eugene Woods Civic Center in amount of $1,x.08.00 for next semester. Alderman Bentley, seconded by Alderman Grimsley, moved that sign lease agreement of $1,J~08.00 for next semester with East Arkansas Community College to cover janitorial services and. utilities. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None. 7. Letter be written to all Act 9 Industries for list of equipment, buildings, and material bought with Act 9 bond money. Alderman Bentley, seconded by Alderman King, moved that a letter be written to all Act 9 Industries for list of equipment, buildings, and material bought with Act 9 bond money. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay : None . 8. Connecticut General not be paid $35,000.00 premium at this time, Connecticut General is the holding insurance company for pension plan for non uniform employees. moved Alderman Bentley, seconded by Alderman Rodgers,~that Connecticut General not be paid $35, 000.00 premium at this time . 1~~fter explanation by Alderman Holt pertaining to pension plans of the City, the vote was as follows: Aye: Aldermen: Bentley, ~'osgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay; None. • 9. Amend budget-increase be made in maintenance or supplies for the shop 1509 in amount of $50.00 for U~elding supplies . Alderman Bentley, seconded by Alderman Holt, moved that increase be made in Account 1509 of $50.00 for welding supplies. Upon vote, the voting was as ~ follows : Aye: l~.ldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay : None . Recommendation as to auditing to be presented at the next Council meeting. Progress report on recommendations of the Drainage Committee was made by City Engineer Brawley. Item as to enforcing ordinance pertaining to grass- cuttings, etc. being placed in plastic bags was referred to the Police Commission. Operation of the street sweeper, securing an additional sweeper, care of City equipment, and a maintenance program, were discussed. Alderman Cosgrove, Chairman of an Insurance Committee, requested the following letters be made a part of the minutes: Crittenden Insurance Agency March 30, 1976 Dear Mayor; Pursuant to your. instructions we have marked our records not to renew captioned workmen's compensation policies expiring April 1, 1976. ri ri n i~ n i~ n n i~~ i~ i~ i~ i~ ~~ CITY OF WEST MEMPHIS March 30, 1976 Mr. Charles DeGraff Crittenden Insurance Agency West Memphis, Arkansas 72301 Dear Mr. DeGraff: This is to inform you to renew general liability and automobile insurance for the City and any policies you are not consulted about as they become due. Very truly yours, /S/ JOYCE T. FERGUSON, Mayor City of West Memphis Alderman Cosgrove advised decision of the Insurance Committee that each policy as becomes due would be renewed automatically simply by coming by the Chairman unless the Committee wants to look at it. Alderman King, Chairman of the Mosquito Spray Committee, reported bid of Atkison Flying Service of $.79 per acre had been accepted, cost $2,370.00 per spray a savings of $510.00 from last year. Date to be set for starting sprays. Alderman Cosgrove requested policy of the Company be sent to him. Scruggs Equipment 3 packer units $9,013.28 Each Tom Gibson Ford cab 1-1-,199.99 Ryan Chevrolet Co., Inc. pick-up truck x,165.90 Hawkins Equipment !~ cubic yd containers 7,2b4..00 Hawkins Equipment 6 cubic yd containers 6,200.00 Alderman Harris presented Sanitation Committee report on bids received April 1 the following recommendations : Accept the following bids Motion was made by Alderman Harris, seconded by Alderman Grimsley that accept recommendation of the Sanitation Committee . After consideration, the.. arming sas.~as follows : Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None. Alderman Harris, seconded by Alderman Dickerson, that recommendation of the Sanitation Committee to hire two men to maintain equipment, wash, and grease units at night be approved. After discussion, roll call vote was as follows: Aye: Aldermen: Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, and Rodgers. Nay: Alderman King Alderman Bentley abstained. The motion carried. Alderman King reported the Shop Committee had accepted the low bid of Jack Flint Son Inc. in the amount of $1.225.00 for the steam clPanPr_ Joryn Smith presented bids : cyan Chevrole t Ryan Chevrolet Tom Gibson Ford Tom Gibson Ford Tom Gibson Ford Tom Gibson Ford Tom Gibson Ford cyan Chevrolet Ryan Chevrolet Ditch Witch of Memphis Utility Equipment Utility Equipment Utility Committee recommendation to accept the following 2 Cars $4326.20 Ton pickup 4165.91 1 Ton pickup 5266.61 1 Ton pickup 5260.50 2 2 ton dumps 8810.x.2 Each 2 Ton bucket 66.0.21 2 Ton derrick 7682.11 2 Ton van 3763.47 1 Ton van x.986 , 75 Ditching Machine 910,4.53 Boom Truck 25631.00 Bucket Truck 22209.60 <1 Diversified Electric Supply Company No. 2 Wire $601.2I~ Hundred General Electric Supply Company Poles $5,318.20 Total Eastern Specialty Company Analyzer $1,290.00 Alderman Bentley, seconded by Alderman Holt, moved that accept Utility Committee recommendations. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, and Rodgers. Nay: None. Aldermen King and Horton were not present for voting. Upon request for permission to advertise for bids for repair of 500 KVA Transformer, Alderman Rodgers, seconded by Alderman Grimsley, moved that permission be granted to advertise for bids to repair 500 KVA Transformer. The voting was as follows: Aye: 1~ldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None . Alderman Bentley announced a Utility Committee meeting after Council adjourns in the Council Chamber. Joe Scarbrough, Purchasing Agent, advised the lotnr bids for greet Department vehicles were as follows; Tom Gibson Ford 2 Ton Dump Truck $7,669.71 I-~yan Chevrolet 1976 Impala $l~.,326.20 Alderman Holt, seconded by alderman Grimsley, moved that accept bids. Upon roll call vote, the voting was as follows: Aye: Aldermen: Dickerson, Grimsley, Harris, Hightower, Holt, and Rodgers. Nay: None. Aldermen Bentley, Cosgrove, Horton, and King were not present for voting. Joe Scarbrough presented the report that Acme Termite Co. was the low bidder in the amount of $1,296.00 for household pest and rodent control. Alderman Bentley, seconded by Alderman Holt, moved that accept bid of Acme Termite Co. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Dickerson, Grimsley, Harris, Hightower, Holt, and Rodgers. Nay; None . Aldermen King, Cosgrove, and Horton were not present for voting. Payments to Acme to be made each month. Alderman Bentley, Chairman of the City Hall Building Committee, reported recommendation of the Committee, and moved that the low bid of National Electric Company of. Memphis for lighting equipment amount of $5,110.00 for two parking lots in the Municipal Complex be accepted. The motion was seconded by Alderman Holt. After discussion of architect's assurance conduits will be located and identified, the voting was as follows: Aye: Aldermen: Bentley, Dickerson, Grimsley, Harris, Hightower, Holt, and Rodgers . Nay: None . Aldermen King, Cosgrove, and Horton were not present for voting. ~~ Alderman Holt reported the Street Committee had accepted the low bid of Moody Equipment for street sweeper in amount of $27, 69..00. Alderman Grimsley reported on Park Commission meeting as to equipment starting to work on the Airport Road park. Alderman Horton brought to the Councils attention request of Police Department for Civil Service Examination to be given, and inquired as to the Councils feeling as to the cumbersomeness of the Civil Service requirements. A lengthy discussion was had with members of the Civil Service Commission as to legislation pertaining to creation of Commission, function of the Commission, newness of Civil Service, testing, elibibility list, authority of Commission, attendance of Aldermen at Commission sessions, information requested by the Commission, Commissionerts time available, communications, and appreciation to the Commissioners. Joe Scarbrough reported Tom Gibson Ford was the low bidder on a police unit, 500 Custom $x.555.0! Alderman Bentley, seconded by Alderman King, moved that accept bid of Tom Gibson Ford for 1976 Ford Custom 500 amount $x.,555.00• Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None. Mayor Ferguson announced the resignation of City Treasurer Fred W. Owen as of May 30, 1976, copy of letter of resignation included in packet. Appreciation for work of the City Treasurer was expressed. Preliminary and Final Plats of Lehr Heights Addition Block 3 was presented. Motion was made by Alderman Bentley, seconded by Alderman Cosgrove, that approve Preliminary and Final Plats of street Lehr Heights Addition Block 3. Upon vote, the voting was as follows : Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Harris, Hightower, Holt, Horton, King, and Rodgers. Nay: None. Motion was made by Alderman Bentley, seconded by Alderman Holt, that advertise for bids for demolition of the old incincerator. Upon vote, the voting was as follows: Aye: Aldermen: Bentley, Cosgrove, Grimsley, Harris, Hightower, Holt, Horton, and King. Nay : None . Aldermen Rodgers and DicI~erson were not present for voting. Mayor Ferguson announced a Mayor's Prayer Breakfast for the Jerry Spencer Crusade 7 A.M. Monday, T~Iay 10th, Mid-Continent Truck Stop No. 2 for City Officials and guests. The Mayor announced a District Meeting of the Arkansas Municipal League will be held in Little Rock May 3rd and lath, she and City Attorney are attending, and Aldermen to call Mayor's Office if plan to attend also. Mr. Morris Fair, Financial Consultant for the City, reported on meeting to review proposed utility bond ordinance, and discussed with the City Attorney and Council the ordinance especially Sections 6, 22, 23, 20, funding costs, and rating of bonds. The Mayor stated that consideration should be given to an ordinance authorizing the issuance of bonds. This was a matter with which the Council was familiar and after a discussion, Alderman Bentley introduced an ordinance entitled: ~~An Ordinance Providing For The Issuance Of Public Utility Refunding And Improvement Revenue Bonds For The Purpose Of Refunding Certain Outstanding Revenue Bonds (Described In The Authorizing Ordinance) And Financing The Cost Of Constructing And Equipping Improvements To The Public Utility System Of The City Of West Memphis, Arkansas; Providing For The Payment Of The Principal Of And Interest On The Bonds; Prescribing Other Matters Relating Thereto; And Declaring An Emergency.~~ and the City Attorney read the ordinance in full. ~~ Alderman Rodgers, seconded by Alderman Holt, moved that the rule requiring the reading of an ordinance or resolution in full on three different days be suspended and that the ordinance be placed on its second reading. The Mayor put the question on the adoption of the motion and the roll being called, the following voted: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Hightower, Holt, Horton, and Rodgers and the following voted i1ay: None Aldermen Harris and King were not present for voting. Thereupon the Mayor declared that at least two-thirds of all members of the Council having voted in favor of the motion to suspend the rule, the motion was carried and the rule suspended. The ordinance was then read by the City Attorney. Alderman Bentley, seconded by Alderman Hightower then moved that the rule requiring the reading of an ordinance in full on three different days be further suspended and that the ordinance be placed on its third reading. The Mayor put the question on the adoption of the motion and the roll being called the following voted: Aye: Aldermen: Bentley, Cosgrove, Dickerson, Grimsley, Hightower, Holt, Horton, and Rodgers and the following voted Nay: None. Aldermen Harris and King were not present for voting. The Mayor declared that at least two-thirds of all members elected to the Council having voted in favor of the motion to suspend the rule, the motion was carried and the rule suspended. The ordinance was then read by the City ~..ttorney. Alderman Horton, seconded by Alderman King, moved that the ordinance be adopted. The question was put by the Mayor on the adoption of the motion and the roll being called, the following voted: Aye: 1~lderm.en: Bentley, Cosgrove, Dickerson, Hightower, Holt, Horton, King, and Rodgers and the following voted Nay : Pdone . Aldermen Grimsley and Harris were not present for voting. Alderman Bentley, seconded by Alderman Cosgrove, moved that Section 35, the emergency clause be adopted, and on roll call, the following voted; Aye: Aldermen: Bentley, Cosgrove, Dickerson, Highto~r, Holt, Horton, King, and Rodgers and the following voted Nay : None . Aldermen Grimsley and Harris were not present for voting. The Mayor thereupon declared the ordinance and the emergency clause adopted and signed the ordinance, which was attested by the City Clerk and sealed with the seal of the City. The ordinance was given No. 862. The ordinance read as follows: 18 ~, IZ , - - C_ I )I I~I~1 I~ C, I.. iv U . _ _~_ t __ r~Pvr (~iZ1~I,1i~1'<:~I: i'iZ~~~t.~II~IU~:~ i'C~it `1'III: I:~;~t1i1NC,I' C)1' i'lllil IC; IJ'I'I I.I'I''r li}'}'t11; i ~INC~ h Nl) I ~1,~1I'I:UVI;,~'I1: U'I' I:1:VL:I~'UI; 13c),~il >,; I'()1Z TIl1~ I'UIII'O;;l; O1, I~I:I't1I'~ I)l~~~Tt~~ C1:1~'l'r'~IN C)tl'I'~'I'r1i~Ii ~I;ti~.~ I:L'1jI_:i~UI: I~C~i~'I),S (i)I:;CIZIi3I;T~ IN 'I'Ill: r111'i'1iC~IZIli~'~~ C`I:L?il~Ai~'CI:) 11 ~1;) I'IPvI~N(,IILTC, `['ill, CC~~'I' t~I-, C:~~:V,~'1'izl,c"I'II<~ ~':IvL> I;(Jl,'I1'I'iiyta 1i~~1I'Ilt)V1;I~;lI_',~:'I'S 'I'G `1'HI.: 1'ULiL.IC; lJ'J'11_,l'I';' S STI;1i O1' TIiI; C1T~" UI' ~!'-'L'~T ~.~I1:,11I'III;~ , ~1R1~lNSrIS; I'IZOVII_~I ti~G I~'OIZ THE I'A1'iL~IF NT OI, TI IE I'RIi~ICI I,1~ I. O I' ~~ i\,' l~ I~?T1:RI~ST OBI TI-I I; BONDS; PIZESCRIBINC O"rII~R Mr1TTEIZ,S I~EI~r1TII~IC TI-II;I~1'I'O; ANTS DECIARIi~1G 11I\T E~1T~RCENCY. WiIERE.t~S , the City of West Memphis , Arkansas (the "City") owns and operates electric, water and server facilities as a single municipal undertakiing the facilities of which constitute the City's Public Utility System (and which will b~ .herein referred to as the "System "); and WHEREAS, the City has outstanding the following issues of bonds which are secured by pledges of revenues derived from the System (referred to herein, collectively, as the "previous .bonds "): {1) Sec~tiTer Revenue Refunduig and Improvement Bonds , dated ju~ze I , 1945 , (Z) Se~~~~er Revenue Bonds , dated August 1, 1949 . (3) Public Utility Revenue Bonds , dated May 1 , 1954 (4) Public Utility Revenue Bonds , dated April 1 , 1956. (S) Public Utility Revenue .Bonds , dated July 1 , 1963. (6) Public Utility Revenue. Bonds , dated June 1, 1967 . (7) Public Utility Revenue Bonds., dated May 1, 1968. (8) Public. Utility Revenue Bo:zds , dated October 1 , i 9 71 . (9)~ Public Utility Revenue Bonds (Temporary) , dated June 1 , 1974 and tNHEREAS , the City Council has determined that it is in the best interest of the Cite .that .there be constructed and equipped improvements and extensions to the System, including , gE ne ra lly stated , construction of a «~a ter treatment plant , primary pumping. pla nt and outfa 11 line, s , se tic: r and water roi.}la can~~etlt, t}~e Cut`''s shard of th` cost of an I;iZVironment~~l Protcc~tic~ii .Agency Cva1L'atlon Study, acquisition of existing platlt lI1 annt_xed ~rCa irol~l A rkansa s Povvc r and Light Comp~3 ny , cons trot. tion of a pumpiizc~ sta ti:~n a nu contingency f~~r eoizstrur.tie~n (the; "imprcn~c ~~i~~ nts "};' anti ~'4'11I:I~L-'AS, plans encl. estimates of costs for tl~e itnl~rovetncnts h~~~.'e been prepared by a qualified consulting eiZgineer anal are on file with the City C1er}; wl~erc they may be inspectecl by ~~ny interested person; ,~ncl ~J Paye 2 ~S, the total estimated cost of the improvements is 3 ,315,000 and a portion- of the cost., $270,000, will be agency or a gE ncic s of the United States , and the balance, $3 ,045 , 000 , must be provided by the City; and WHEREAS , the City can finance its portion of the cost of the improvements by the issuance of public utility revenue bonds; -and WHEREAS , it is necessary to the sale and issuance of public utility revenue bonds on the best obtainable terms that the previous bonds be refunded, and the City Council has determined that by the refunding of the previous bonds the City will realize significant savings and will realize other significant bene- fits (such as the removal of restrictions on the operation of the System and restrictions on the financing of System improvements and the recovery of reserve funds and WHEREAS, the City is authorized to issue -bonds to accomplish the refunding and the improvements under the Constitution and laws of the State of Arkansas, including Act No. 131 of 1933, as amended, Act No. 132 of 1.933, as amended, Act No. 297 of 1937, as amended, and Act No. 145 of 1967, as amended; NOW, THEREFORE., BE IT ORDAINED by the City Council of the City of West IVlemphis , Arkansas Section 1 . The refunding and improvements shall be accomplished, and the Mayor and City Clerk-are hereby authorized to execute and deliver such documents and writings and to take such other action as may be necessary or i appropriate thereto. The City Council hereby finds and declares that the period '~' ~of usefulness of the im rovements is .fort p y (40) years , which is longer than the ~. term o.f the bonds (identified below) . Section 2 . Under the Cc~n.stitution and laws of the State of Arkansas , including Act No. 131 of 1933, as amended, Act No. 132 of 1933, as amended, Act No. 297 of 1937, as amended, and Act No. 145 of 1967, as amended, and applicable decisions of the Supreme Court of the State of Arkansas , including Cit~of Harxison v . Braswell, 209 Ark . 1094 , 194 S . W. 2d 12 (1946) , City of u W Page 3 West Memphis , Arkansas Public-Utility Refunding and Improvement Revenue Bonds, Series 1976 {the "bonds"), are hereby authorized and ordered issued in the total principal amount of $5, 73'0,000, for the purposes of acromplshiiig 'the refunding of the previous bonds,financing 'the improvements and paying expenses incidental thereto and to the issuancE of the bonds. The bonds shall be dated May 1, .1976 and, shall mature on May 1, of each year as follows: Date 1977 1978 19 79 . I980 _ 1981 19.82 1983 19 84 19$5 1986 . 1987 1988- 1989 _ 3.9 9 0 1991 1992 .1993 1994 ~19y5 1996 1997 1998 1999 ` 2000 2001 Amount 1.05,000 11S,000 120,000 130,.000 3.35,000 140,000 150,000 155.,000 . .~ 165,000 1.75,000 185,000 195,000 205,000 215 , 000 230,000 245,000 260,000 275,000 295,000 315,000 335,000 355,000 380,000 410, 000 440,004 ~~ P~~ g e 4 Interest on the bonds slla 11 be payable: on May 1 a nd November 1 - of each year, commencing November 1 , 1976. The bon<~s shall be numbered from 1 upwards.. and shall be in substantially the form hereinafter set forth. The bonds shall be subject to redemption prior to maturity as set forth in the form of bond hereinafter . The bonds sha 11 be sold at public sale , and the Mayor is authorized (upon consultation with the City's fiscal agent) to publish and distribute a notice of sale and other descriptive documents for the purpose of effecting sale of the bonds on the best terms obtainable, Sale of the bonds shall be approved by resolution of the City Council, which .resolution- shall set forth the terms of the. bonds asthey are being issued, including interest rates, semiannual interest requirements, annual principal and interest requirements , bond numbers , denominations and the designation of a trustee and paying agent . The Notice of Sale sha 11 be in substa ntia lly the following form: wr, ;~ 2 NQTICE OF SALE OF CITY CF WEST MEMPI~IS, ARKANSAS. PUBLIC UTLLITY REFUNDING AND IMPRQVEiVIENT REVENTJE; BC~N1~S , SERIES I'976 T~ATEZ? MAY 1 , 1975 Thee City of West Memphis , Arkansas (the "City'.') , hereby gives notice that there will- be sold on sealed bids on May 6 , 1976 a t 1: 3 0 p. m., local time its proposEd issue of $5 , 73 0 , 0,00. Public Utility Refunding,. a nd Impro~emcnt Revenue Bonds., Series 1976, dated May 1 , 1976 (the` "bonds") . Interest on the bonds will be payable. semiannually on May 1 and November 1 of each year, commencing Maly 1, 19 76 . The bonds will mature annually on May i of each. year as follows (but shall be subject to redemption prior to maturity as hereinafter set forth): Date H mount 1977 - I05,000 1978 115,000 1979 120,00.0 1980 130, 000 1981 135,000 1982 ~ 140,000 1983. ~ 150,.000 1984 155,000` 1985. 165,000 19 86- ~ 1 ~5 , 000 1987 185,000 1988 195,000 1989 205,000 1990 215,000 1991 230, 000 1992 245,000 19:93 260,00 _ 1994. ~ ~ 2.75:; 000 1995 295,000 1996 3.15,000 1.997 335,000 lggg 355;000 - 1999 3 80-, 000 2000 43.0,000 2001 440,000 ~' a) [ u t The bonds are being issued under the Constitution and laws of the State of Arkansas , including specifically Act . No. 131 of 1933 , a s amended , Act No. 132 of 1933, as amended, Act no. 297 of 193.7, as amended, and Act No. 148 of 1967, as amended, and applicable decisions of the Supreme Court of the State of Arkansas, including particularly City of Harrison v. Braswell, 2091~rk. 1094, 194 S. W. 2d 12 (1946). The bonds will not be general obligations of the City, but will be special obligations secured by a pledge of and payable solely from revenues derived from the operation of the Electric, Wa ter a nd Sewer System of the City (which the City opera to s a s a single , combined municipal undertaking (the "System"}},and will not constitute an indebtedness of the City within the meaning of any constitutional or statutory limita tian. The bonds are being issued for the purpose of refunding all outstanding. bonds of the City which are secured by pledges of System revenues ($4,.024,000 in aggregate p~'incipa 1 amount now outstanding) and for the purpose of financing the cost to the City of constructing extensions, betterments and improvements (the "improvements") to the System and paying expenses incidental thereto and to the sale and issuance of the bonds . The bonds will be subject to redemption prior to maturity, at the option of the City , in whole or in part, with there to be no pa rtia 1 redemption of any bond, in inverse numerical order as follows: (a) from proceeds of the bonds in excess of the amounts needed. to accomplish the refunding a nd the iinprove- ments on any interest payment date , at a price of the principal amount of the bonds being redeemed plus accrued interest to the date of redemption; (b) from funds from any source, on any interest payment date on and after May 1, 1988, at a price of the principal amount being redeemed, plus accrued interest to date of redemption, plus a premium as follows: 3% if redeemed May 1, 2 1/2% if redeemed May 1, 2% if redeemed May 1, 1 1/2% if redEemed May 1, 1% ~ if redeemed May 1 , 1/2% i_f redeemed May 1, No premium if redee med May 1988 ur November 1, 1988; 1989 or November 1, 1989; 1990 or November 1, 1990; 1991 or November 1, 19,91; 1992 or November 1 , 1992; 1993 or November 1 , 1993; 1 , 1994 or therea fte r. yyy // G .a~i The bonds will k~e coupon bonds , payable to bearer, but. s~.~l~ject to registration. as to principal or as to principal and interest, in the dc~norninatior~ of $5 , 000 {each S~.tpple mental a nd dua 1 coupons. will not bc: permitted , and the bond s shall not be subject to conversion, Bidders may specify no more than five (5) rates. of interest and the rates shall be subject to the following limitations: 1. No bond may bear interest a t a rate ..greater than 7% per annum . 2. The difference between the highest and lowest rates of interest may not exceed 2% . 3. No bond may bear interest at a rate greater than that borne by any bond of later maturity;. 4 . Bonds of each maturity must bear interest a t the same. rate , from date to maturity . No bid of less than 97,5% of par and accrued interest will be entertained. The award , if made , will be to the .bid der whose bid results in the lowest ne t interest cost to the City, to be determined by computing the aggregate interest cost to the City at the rate bid-from date-to maturity and adding the amount of any discount or deducting the amount of any, prer~iium bid . The purchaser shall have .the privilege of naming the Trustee and Paying Agent (subject to ~a pprova 1 by the City) . The City reserves the right to reject any and all bids . No contingent provision may be included in any bide. A11 expenses, including, without limitation, bond printing, the Trustee's authentication fee, financial consultant`s fee and the fee of Smith, Williams, Friday,.EldrEdge & Clark, Bond Counsel, upon whose.: approving opinion the bond:- _ ,will be issued, will be paid by the City.. -All bids must be submitted on the Official Bid Form. ~~ A certified or cashier's check, in an amount equal to 2% of the principal amount of the bonds, must be enclosed with each bid, to be kept by the City as liquidated damages in the event that the bidder is awarded the sale of the bonds and fails. to complete the purchase . Interest will not be .paid on good faith checks , but good faith checks of unsuccessful bidders will bE promptly returned . Sea led bids will be received until the date and time specified above and each bid shall be enclosed in a sea led envelope marked on the outside "Proposa 1 for City of ~IVest Memphis, Arkansas, Public Utility Refunding and Improvement Revenue Bonds, dated May 1, 1976, Series 1976" and addressed to The Honorable Joyce Ferguson, Mayor, West Memphis ,Arkansas . The bids .will be opened a t that time in the meeting place of the City Council , City Ha 11, West Memphis , .Arkansas . The award , if any, will be made within 24 hours after the receipt of bids; and the City reserves the right to withhold the award for 24 hours. r Additiona 1 informa tion and copies of Officia 1 Bid Forms may be obtained from the undersigned or from UMIC , Inc . , P . O . Box 3 783 , Memphis , Tennessee . 3 8103 . This day of 1976. CITY OF WEST MEMPHIS, ARKANSAS - By: Mayor ~6 Page , 9 Section 3. The bonds shall be executed on behalf of the City by the A-layor ar~d City Clerk and shall have impressed thereon the seal of the. City. The bond may be executed by the facsimile signature of the Mayor and the interest coupons attached to the .bonds may be executed by the facsimile signature of the Mayor. Any facsimile. signature of the Mayor shall have the same force and ~e ffect a s a manual signa ture~. ThE bonds. must be executed by the manual signature of the City Clerk. The bonds., together wifih interest thereon, shall be payable solely from the Public Utility Revenue Bond Fund, as hereinafter set forth, and shall be a valid claim of the holders thereof only against such fund and the revenues pledged to such fund, which revenues are hereby pledged and morgaged for thee: equal and` ratable payment of the bonds , and shall be used for no other purpose ~~han to pay the principal, interest, and-trustee's and paying agent's fees on the-bonds , except as otherwise.- specifically provided in this Ordinance . The bonds -shall not be general obligations. of the City, but shall be special obligations, the principal of and interest on which are secured by a pledge of net- revenues (gross revenues less operation. anal maintenance expenses) derived from the operation of the System: The bonds and interest thereon shall not consfitute an inddbtedness of the City .within. any constitutional or statutory limitation . Section. 4, The bonds and coupons shall be in substantially the following form, and the Mayor and City Clerk are hereby expressly authorized and directed to make all recitals contained therein: 27 UNITED STATES OF A MERICA STATE OF ARKANSAS COUNTY OF CRITTENDEN CITY OF WEST MEMPHIS PUBLIC UTILITY REVENUE REFUNDING AND IMPROVEMENT BOND, SERIES 1976 No . KNOW ALL MEN BY THESE PRESENTS: $5,000 That the City of West Memphis , Crittenden County, Arkansas {the "City") , acknowledges itself to owe, and for value received hereby promises to pay to bearer, or if this bond be registered to the registered owner hereof, solely from the special fund as hereinafter set forth, the principal sum of FIVE THOUSAND DOLLARS ($5, X00) in lawful., money of the United States of America on the first day of May, 19 , and.to pay solely from the special fund interest thereon at the rate of percent { %) per annum from the date hereof until paid. Interest is payable semiannually on May 1 and November 1 of each year, commencing November l , 1976. Principal and interest are payable a t the principal office of , (the "Trustee" and "Paying Agent ") . Payment of .interest , when registered as to interest , may be by check or draft mailed to the registered owner at his address reflected on the registration book of the City maintained. by the Trustee as bond registrar. This bond is one of an issue of Public Utility Revenue Refunding and - Improvement Bonds, Series 1976, agc~re atin $5,730,000.. in . _ g g principal amount, ~3ated May 1 , .197,6, all of Tike tenor a nd effect except.a s to number, denomination, rate of intE re s t , maturity and right of prior redemption. (the "bonds ") ,~ issued for the purpose of refunding bonds previously issued, financing the construction and eq~uipmE nt of extensions , betterments and improvements (the "improvements ") to the. City's Public Utility System (an electric, water and sEwer system operated as a .single municipal undertaking (the "System"}) .and paying necessary expenses incidenta 1 thereto and to the issuance of the bonds . ~1 Fa g e l l The bonds. are issued pursuant to and in full compliance with the Constitution and laws of the State of Arkansas , including particularly Act No . 131 of 1933, as amended, Act No. 132 of 1933, as amended, Act No. 297 of 1937, as amended, and Act No. 145 of 1967, as amended, and applicable decisions of the Supreme Court of the State of Arkansas , including particularly City of Harrison v. Braswell, 209 Ark. 1094; 194 S.~ W. 2d 12 (19.46), and pursuant to Ordinance No . ,duly adopted by the City Council and approved on the day of ~ 1976 (the "Authorizing Ordinance") , and do not constitute an indebtedness of the City-within any constitutional or statutory limitation. The bonds are not general obligations of the City, but, are special obligations payable solely. from net revenues of the System... An amount ~of System revenues sufficient to pay the principal and interest on the .bonds is to be set aside in a special fund for that purpose identified as "Public Utility Revenue rond Fund, " created by the Authorizing Ordinance , to whirr. reference is hereby made .for a statement of the nature: and .extent of the security and the rights and. obligations of the City, the Trustee and the holders of the bonds.. The City has .fixed and has covenanted and agreed to maintain rates for services of the. System which shall be~ suff.cient at all times at least to provide for the payment of the reasonable expenses of operation and maintenance of the System , to provide for the .payment , when due , of the principa 1 of and interest on the bonds, with Trustee's and Paying~Agent's fees, as the same become due .and payable, to maintain required reserves, and to make required deposits for the depreciation of the System. . The bonds are subject fio redemption prior to maturity., at the option of the City, in whole or in part, with there to be no partial redemption of any - bond., in inverse numerical order, a s follows: (a } from proceeds of the- bond s in excess-of amounts-needed to accomplish the refunding. and the improvements , on any interest payment date , a t a price of the principal amount of the bond s being redeemed. plus accrued interest to the date of redemption; (b) from funds from any source onany interest payment date on and after May 1, 1988, at a price of the principal amount of the bonds being redeEmed , plus. accrued interest - to date of redemption, plus a premium as follows: c7 ~.. Pa C7 E' .l ~~r 1 f I (' d ( (? ! Il C. (_~ !~~} c3 y 1 , 2 1/2% if r{;deemed I`~1ay ] , 2°~, if r~dccrncc_l Il'Iay 1 , 1 1/7.`/~ if rrdeemecl tUiay 1 , l~/~ if rccieemed May 1, 1/2~/o if redecm~d May 1 , No premiu m if redee med May 19t~f3 (~r November 1, 1J£3f3; i9f39 or- I~overnber 1, 1989; 1.990 or November l , 199; 1991 or November 1, 199.1, 1.992 car I~lvvem}per 1 , 1992; 1993 or November 1 , 1.993; 1 , 1994 car t}Ierca fto . I`TOtice of the call for redemption shall be published one time in a newspaper of general circulation throughtout the State of Arkansas published in the City of Little Rock, Arkansas, giving the number and maturity of each bond being called, with the publication to be at least fifteen (15) days prior to t11e redemption d:~te, arZCi after the date fixed for redemption each bond so called sht~ll cease to bear interest, providod funds .for its payment are on deposit. with the Paying Agent at that tim~c . In ad;iition, notice shall be given by certified yr registered mail to the registered owner of eac11 bond registered as to principal at the address of such owner reflected on t}ie bond registration book of the band registrar, and if a 11 outstanding bonds s}za 11 be registered a s to principal notice by certified or registered mail to the registered owners thereof _as aforesaid shall bL sufficient, and it shall not be necessary to publish notice of the ca 11. .This bond may bL registered as to principal 'or as to principal and interest and may bL discharged from such registration in the manner., with t}lc effect and subject to the terms and conditions endorsed hereon. Subject to the provisions for registration eridors.ed hereon, nothing comained in this bond or in the Authorizing Ordina-nee shall affect or impair tl~e negotiability of this bond, and this bond sha 11 be deemed a n~ gotiable instrument uncle r the Ia ws of the State of Ar}:ansas. This bond is issued with the intent that the la~~rs of the. State of Arkansas will govern its construction. This bond shall not bo valid until it shall have been authenticated by the Certificate licreon duly signed by the `Trustee . IT IS }-IER};13Y CEIZTIFIL'D , RI,CI`TED AND 1 ~ECI_l~ IZE l~ that a 11 ~~c is , conditions end things required to exist, happen a~1d to be performed preced`nt . to and in the issuance of the bonds have existod , have happened and have been porforrried in due tune, form and manner, as required by law; that the indebtedness z~ Page l3 represented by the bonds does not exceed any constitutional. or statutory limitation; and that sufficient revenues have been pl~dgcd to and will be sot aside -for the payment of the principal of and interest on the bonds . I?1T ~ATITIVESS WI3ERECF, the City. of West Memphis , l~rkansas , by its City Council, has caused this bond to be signed by the Mayor and-City Clerk thereof {with the facsimile signature of the Mayor and the manual signature of the City Clerk) and sealed with the seal of the City, and has .caused the interest coupons attached to be signed by the facsimile signature.. of the Mayor, all as of the first day of May, 1976. CITY OF WEST 1VIEMPHIS , 1~RK.~NSAS ATTEST: (SEAL) City Clerk By (facsimile signature) Mayor J ~_ Page 14 (Form of Coupon) No. On the first day of (May 1) (November 1) , 19 _, the City of West Memphis , Arkansas , unless the bond to which this coupon is attached is paid prior thereto , hereby promises to pay to bearer solely out of the fund specified in the bond to which this coupon is attached DOLI..ARS in lawful money of the United States of America, at the principal office of - ,being six (6) months interest then due on its Public Utility Revenue Refunding and Improvement Bond, Series 1976, dated May- 1, 1976, and numbered . CITY OF WEST MEMPI~IS , ARKANSAS By (facsimile signature) Mayor On each of the bonds shall appear the following: _ CERTIFICATE OF AUTHENTICATION This is one of the bonds of the issue of the. City of West Memphis , Arkansas , Public Utility Revenue ~ Refunding and Improvement Bonds , Series 1976 , dated May 1, 1976, described within. By __ _ _ _- (Authorized Signature) t,. ..7 l+ Page 15 PRC~VISIC)NS FOR IZEGISTFUITION I~ND RECONVLRSIC?N This bond may be registered as to principal alone on boo}:s of tlzc City, }:ept by the 'Trustee as bond registrar, upon presentation hereof to the bond. regist , which shall make mention o.f suc'n registration in the registrat-ion blan}: below, and th1S bond may thereafter be ~transf~rrec~ only upon an assignment duly executed by the registered owner or his attorney or legal representative in such form as shall be satisfactory ~to the bond regiistrar, such transfer to be made on st.tch books and endorsed hereon by the- bond registrar. Such transfer may be to bearer, and there- after ~transf~rabilty by delivery shall be restored, .but this bond shall again be subject to successive registrations and-'transfers. as before. The principal of this bond, if registered, unless ~regis~tered 'to bearer, shall be payable only 'to or upon thu order of the registered owner: or leis legal representative . Interest accruing on this bond will be paid only on presentation and surrender of the attached in~terest- coupons as they respectively become due, and notwithstanding the registration o this bond as to principal, the appiutenant interest coupons shall remain payable ~to bearer and s~lail continue to betransferable by delivery; provided, ~tha~t if upon registration of 'this bond; or at any time thereafter while this bond is registered in the name of the owner, 'the. unma~tured coupons a°ttached evidencing interest to be thci-eaft~r paid hereon .shall be surrendered ~to said bond registrar, a statement tothat effect will be endorsed hereon by the bond registrar and .,thereafter interest evidersced by such surrendered. coupons may be paid by check or draft of 'the bond registrar at the times provided herein 'to the registered ow~ier of this bond by mail to the address shown on the registration books . ,This .bond when so converted into a bond. registered as.'to both principal and interest may be reconverted ir_to a ~~•oupon. bond at the written request: of the registered. owner alld upon preseiztat.ion a~t the office of said bond registrar. Upon such rcconv~rsion 'tlle coupons repre- stinting the .interest ~to become due. thereafter to tllc date of maturity will again 11c Page 1 G attached to this .bond and a statement will be endorse hereon by the bond registrar in the registration blank below whether it is then registcrca ~ZS to principal or payable to bearer. The expense, if any, for a bon:.l registcrca or reconverted to bearer, shall be paid at the expense of the owner. _ ._._ _~___ ~,1~;I~nt~I~ cif ~i~.r?l~~tlirc of _.~____ - Uc1te Of 1ZC~iS~r~~ti(~n •_~Ttl!-~~'' of Rec iStcrcc~__O~~TIl~'r ___~~C'~.,~tI~~'.liC>_?_---~~c~,1;' F'~`'~`i:;t:I_._'.r_ ~4 P~~ y e 17 Section 5. The rates to be chargecl for the services furnished by the- S}Tstc~m, hcrt~tofore fixed by ordinances of the City duly ac~optecl an~a approved, and the conditions, rights arld obligations p~rtainitzg thereto, as sot. fart}~ t}~c~r~~ii1, ~-~re hercl~y ratifa.ec3, eonfirrnec~l and coritin~.ied. The City covenants and a yre c s that the rates sha 11 ne vc r ue reduce d while any of t}1e bonds are. outstanding unless t}zere is obt~~ined from an independont certified public accountant a ccr'tificate that the not revenuo.s of the System net revenues being dsfined as gross revenues less. the expensas of operati©nand maintenance of the System, including all expense items properly attributable to t}le operation and maintenance of the System under generall Y acccptec3 accouzltinc~ principles applicable to municipal olectric, water and sewer systems) , wit}l the reduced ra to s , will always. be equal to tJ1e a mown required to be depos_itec~ in the Depreciation Fund -plus at least. 200%, of the averago annual principal and irlterc~st requirements on all outstanding bonds payablE from the rovenues of the System. `I.'he Cityfurther covenants and agrees t}zat the rates if necessary, from .tune to time, s}za11 be increased to that amount which will produce net revenues at least sufficient to pay principal, interest aild Trustee's and Paying l~yent's fees when due, on all bone}s to which System revenuos are pledged, make .required deposits into the Depreciation Funs}, and otherwise comply with the provisions of this Ordinance and all ordinances authorizing bonds . Section 6. None. of the facilities or services afforded by the System shall be~ fur-nisl~ed without a c}large being made therefor. In the. event that the City or any department, .agency or instrumentality thereof shall avail itself of the facilities and services-afforded by-the System, the reasorlablE valuE of the services or facilities so afforded shall be charged against the City or such de paz-tment, ~gr~nry nr insruinor~talily and shall be paid for as the charges. therefor accrue. `the revenues sv received s}tall be deemed to be revenues derived from t}Ze operation of t}~r--~ System and shall: }~:~ used acid accounted for in ttlc' same R,,/ Page 18 other revenue derived from the operation of the System . Nothing shall be construed as requiring the City or any department, agency or i.nstrumentalitytheteof to avail itself of the facilities or services afforded by the System. Section 7. The System shall be continuously operated as a revenue producing undertaking. All moneys received from the operation of t11e System shall be deposited by him in such depository or depositories for the City as may be lawfully designated-from time to time by the City Council, but which must hold membership in the Federa 1 Deposit Insurance Corporation . All deposits shall be in the name of the City and shall be so designated as to indicate the particular funds to which the revenues belong, Section 8. Public Utility Fund. All revenues derived from the operation of the System shall be paid into a special fund, which is hereby created and designated "Public Utility Fund. " The revenues in the Public Utility Fund are hereby pledged and shall be applied to the payment of the reasonable and necessary expenses of operation and maintenance of the System, to the payment of the principal of-and interest on the bonds , to the providing of the Depreciation Fund, and otherwise as in this Ordinance expressly. authorized. Section 9. Public Utility Operation and Maintenance Fund. There. shall be paid from the Public Utility Fund into a fund which is hereby created and designated "Public Utility Operation and Maintenance Fund" (the "Operation and Maintenance Fund") , on the first business day of each month an amount sufficient to pay the reasonable and necessary monthly expenses ,pf operation, repair and maintenance of the System for such month and from which disbursements shall be made only for those. purposes . Fixed annual .)~ Page 19 charges such as insurance premiums ar~.d the cost of major repair and maintenance- expenses may be computed and. set up on an annual basis , and one-twelfth (1/12) of the amount thereof may be paid into the.Operation and Maintenance Fund each month . If in any month for any reason there shall be a failure to transfer and pay the required amount into said fund, .the amount of any deficiency shall be added to the amount otherwise .required to be transferred and paid into said fund in the next 'succeeding month. If in any fiscal year a surplus shall be accumulated in .the operation and Maintenance Fund over and a'oove the amount which shall be necessary to defxay the reasonable and nece sary costs of operation, repair and maintenance of the System during `the remainder of the then current fiscal year and .the next ensuing fis-cal year, such surplus may be transferred. and deposited in the Bond Fund (hereinafter created) or in the Depreciation Fund (hereinafter created); provided, however, that any such transfer into the Bond Fund shall be in addition to all other payments required to be .made into the Bond Fund.. Sec-lion 10. Public Utility Revenue Bond Fund. (a) After making the monthly deposit in the Operation and Maintenance Fund, there .shall be transferred .from the .Public Utility Fund into a special fund which is hereby. created a nd',designated "Public Utility REVenue Bond Fund" (the "Bond Fund") the sums .in the amounts and at the Mmes hereinafter stated in subsection (b) for the purpose of providing funds for the payment of the principal of and interest on the bonds herein authorized, .with the Trustee's and Paying Agent's fees , and for the, maintenance of a debt service reserve . (b) There .shall be .paid from the Public Utility Fund into the Bond Fund , beginning on the first business day of the month immediately following the month in which the-bonds are delivered, and continuing on the first business Pa~~~ ~0 3? day of each month thereafter until all outstanduZg bonds of this issue with interest thereon have been paid in full, or provision made for such payment , a sum equal to one-si}:tlz (1/6) of the-next installment of interest and one-twelfth (1/12) of the next installment of principal, plus such additional sums as necessary to provide for the Trustee's and Paying Aggnt's fees , on all outstanding bonds; .provided, however, that should the debt service reserve (established pursuant to SECtlon 13 hereof and required hereby to be maintained in the Bond Fund) ever become impaired or be reduced -below the required level of an amount equal to the average annual principal and interest require- meets on the bonds, the required monthly payment shall be increased, until the impairment is cured or the debt service reserve ~is increased to the required level, by transfer of the first available moneys from the Public Utility Fund before any of the moneys in the Public Utility fund sha 11 be used for a ny other purpose except for making the payments hereinabove required to be made into the Operation and Maintenance Fund and into the Bond Fund. (c) 1f the revenues of the System are insufficient to make the required payment on the first business day of the following month into the Bond Fund, then the amount of any such deficiency in the payment made shall be added to the amount otherwise required to be paid .into the Bond Fund on the first business da'y of the next .month . (d) If for any reason the City shall fail at any time to make any of the required payments into the Bond Fund, any sums then held as a debt service reserve shall be used to the extent necessary in the payment of the principal of and interest on the bonds , but such reserve shall be reimbursed from the Public Utility Fund before any of the moneys" in the Public Utility 'Fund shall be used for any other purpose except for making fihe payments hereinabove required to be made into the Operation and Maintenance Fund and into the Bond Fund. The debt service reserve shall be used solely as herein provided. (G) When the tnonc;~s held in the Bond Fund ; including the debt service reserve, shall be and remain sufficient to pay the principal of and interest on all bonds then outstanding, and .the Trustee's and Paying 1lgent's fees, the Treasurer shall not be obligated to make any further payments into the Bond Fund . ~3 8 Page 21 (f) A11 moneys in the Bond Fund shall be `used.- solely for the purpose of payi~~g the principal of and interest ozZ the }aonds , and the Trustee's azZd Paying Agent's fees , except-as herein specifically provided. If a -surplus shall exist in the Bond Fund over andabove the amount required for making all principal and interest payments during the succeeding twelve months~on all outstanding bonds , and the Trustee's. anal Paying Agent's. fees , and over and above the debt service. reserve, such surplus may be applied to the payment of the principal of and interest on any bonds that may be called for redemption prior to maturity. (g) It shall be the duty of the Treasurer. to withdraw from the Bond Fund at least ten (10) days before: the maturity. date- of any bond or- interest coupon issued hereunder and to deposit with the Paying Agent an amount equal to the amount of such bond or coupon for the sole. purpose, of paying the- same, together with the customary Trustee's and Paying Agent's fees, and no withdrawal of- funds from the Bond Fund 'shall be made for any other- purpose except as otherwise authorized in .this Ordinance (h) The bonds shall be specifically secured by a pledge of ail the revenues required to be placed into the Bond Fund. This pledge in favor of the bonds is hereby irrevocably made according to the terms:, of:this Ordinance, aid the. City and its officers azzd eznp ogees shall execute., perform and carry out the terms thereof in strict conformity with the .provisions of this Ordinance . Section ll. _Public:Utility Depreciation Fund.. After making the required payments into the Operation and Maintenance- Fund and the Bond Fund,' there shall be paid from the Public TJtility Fund into. a fund which. is hereby created and designated "Public Utility Depreciation Fund" (the ''Depreciation Fund"}, on the first: business day of the month immediately following the month in which the bonds are delivered and continuing on the first business day of each month thereafter whim: any of the bonds are outstanding, 3% of the gross revenues of .the System far the. preceding month : The moneys in the Depreciation Fund shall be used solely for the purpose of paying .the cost 'of replacements made •):7 Paye ? 2 necessary by the depreciation of the System; provided, however, in the event that no other funds are available therefor the moneys in the Depreciation Fund maybe used to the extent necessary to prevent a default in the payment of the principal of and interest on the bonds . If in any fiscal year a surplus sh<~11 be accumulated in the Depreciation Fund over and above the amount necessary to defray the cost of the probable replacements during the then current fis ca 1 year , and the next ensuing fisca 1 year, such surplus may be transferred and paid into the Bond Fund; provided, however, that such payments into the Bond Fund shall be in addition to all other payments hereinbefore required to be made into the Bond Fund. Section 12. Any surplus in the Public Utility Fund. after making all disbursements required by the provisions of this Ordinance and making full provision for the other funds .herein provided may be used, at the option of the City, for the redemption of bonds prior to maturity in accordance- with the redemption provisions herein set forth , for constructing extensions , betterments and improvements to the System, or for any other lawful municipal parpose . .Section 13. {a} Upon delivery of the bonds there shall be transferred, from fi.~nds or accounts being maintained pursuant to ordinances authorizing. and pertaining td the- previous bonds {or any issue thereof}, and deposited in the Bond Fund, as a debt service reserve, hereby established, an amount equal to the average annual principal and interest requirements on the bonds, which amount- shall be held and 'used solely for the purposes and as set forth in Section 10 hereof. {b) After complying with subsection (a) above , any moneys now being ,hell in any fund or account being maintained pursuant to the ordinances authorizing and .pertaining .to the previous bonds (or any issue thereof) , shall - be transferred to the corresponding fund or funds created and to be maintained pursuant to the provisions of this Ordinance . Section 14. The City hereby agrees that all-payments on the bonds and interest shall be made only through the Paying Agent. All bonds paid at maturity or redemption prior to maturity shall be canceled when such payment is made, ,~' V ~~ ~iltjC 1 ~ • togctlior with gill u:>>r~~~t:urc~c~ cc~upons t~~~l~c:rt~~ir~is3c~ k}~crcto, ~~:icl s}i~~ll 1~ot i~c: rc:l:::;uc~c}. X111 unpaid ir~tcrr,: t coupons..it~aturing vn or prior to t}~c d~7te of :;uc;}i ~~~iy-:icnt • shall continue to be payable to the respective bearers -thereof. Section 15. 11s long as_uny of the bojlds authorired ~~nd issued ~::ic}er and pursuant to the provisions of this Orclinancc arc outstanding, the City shy;11 not issue or attempt to issue any bonds. chimed to be entitled to a ~~riority cif lien on the revenues of the System over the lien securing the. boac}s of this issue. l~jothing contained in this Ordinance shall be construed to prcve:lt the issuance by the City of additional bonds to finance or pay t}ze cost of constructing a:iy future e~,-tensons, betterments or improvetnents to the System; provided, however, the City shall not authorize or issue any•such additio:~al boizds ranki:iy on a parity with these bonds unless and until there shall have been procured and filed with the Trustee a statement by an i~depend`ent certified public accou:ita:~t not in the regular employ of the City reciting the.. opinion based upon necessary investigation that (1) net revenues: of the System for the. fiscal year immediately precedincx the fiscal year in which it is prvposcd to issue such ac?citivnal ponds shall equal nor less t..an .130% of the aver~~ge annual principal and iate.-cst requirements on the bonds and the bonds proposed to be issued, or (2} if the City shall have increased its rates or charges imposed for services of the System prior to the issuance of additional bands and subsequent to the first day of such preceeding year, there may be added to the net revenues. of such fiscal year the additional. net revenues which would .have been received from the operation of the. System during such fiscalyear had such increase been in effect throughout such fiscal year,. as reflected by a certificate of a duly qualified. consulting engineer not in the regular employ of the City -and approved by the Trustee,- in which event the net revenues of the System for such fiscal year as so calculated shall equal not less than 15~°l0 of thee-average annual principal. and interest requirements on the bonds and the bonds proposed to be issued. }ail CSC ? ~} The term "net revenues" as used lii this Section sh~-~}1 mean cJross revenues of the Systcrn less the amounts rccluired to p~~y the cost of c~J~c:r~~tiun, Illi.llllt(:1~~]11CC anc} repair. of t}le Systcrn. the ~~eidition~~l bones, the. i.~suancc. cif :•.hieh i.~ r~~.~tric~tc~l ~~n-. e~c~t. litir~el< ~} b}~ lh1S SeCilc)n, S}lc-~11 1)L L111:1C'rSt000! to TnCc~3n 1)C111r:}5 } )c~~~t~})}:~ f:()::i t}i'~ I:.'t~C:lilil.,~S of the Sysier~~ on ~-~ parity 4ti•ith these }~onc}s and ::}:al} not i:;~ ct~ett~~c} to ir~cludc~ of}icr oblicyiltiotzs the security ~~nc} source of p~~}'(n(?nt of :t~hic•h'arc. su};orc.'it;;lte and subject to the priorit}~ of t}u'se bonds . Section 16. It is covenantee; and a~recc} by tl~e Gity and ~:pit}~ the i~olclcr;, and registere<.i ov.ncrs of t}ze bonds, or any of them, th~~t t}zc City ti:•ill f~~ithful};- and }punctually }perform all c}uti~ s :lritii reference to the S;r~i~~cti reguirecl by the Constitution and laves of the State of Arkansas, including the charging and. collecting of reasonable and sufficient ra tes , a s herein specifics? , Ia ~vfuily establishes} for services rendered by the System, the segregating of the revenues of t}le System as herein required and the applying of the revenues to the respective funds horein created and referred to. Section 17. The bonds authorized hereby and issued hereunder shall be subject to redemption prior to maturity in accordance ~ti~ith the tCI-Ills set _out in the bond form. Section 18. The City ~1~ill keep proper books of accounts any records tseparate from all other records and accounts) iii ,vhich com}Mete ~-~nc} correct entries shall be made. of 31i transactions relating to t}~c c~per~~tioii of the .System, and sac;}~ boo}:s shall }~e availaf~le for 1I15l~(?ctlOn };y the }z~~ltler of t-~ny of t}ze bonds at rcasona}:ale times enc. unc:er rc~ason~~b}e circtici~st~~n,.~ s . '1'}le GitS- agrees to have these r~cr~rcl;: auclitec! 1~}• ~~n incicpende~tiC c:crtified !~u}jlic- r-~crou~itc3nt ~~t }c~-~st once c~~~c,h yc~~~r, ilt1C! a cUl~~• cif t}~~ at~clit shell }~c.~ c'.c~liv:~rcc} ~~ Page 25 to t}1e Trustee and Il~ade availably to interested holders and registered owners . in the event the City fails or refuses to make.theaudit, t}ia `Trustee, or arty holder and Registered owner of t}1e bonds I7~ay have t}Ie audit i7laeie , and tale cost thereof shall be c}urged against t}-Ie O~~era tion and Ma into na xice Fund . Section 19. `The City covenants and agrees that it will maintain the System in good cand.it:ion and. operate the ~sarne in an efficient manner and a t rea sonabie cost. While any bonds a uthorized hereby are outstanding ; the City agrees that it will in-sure and a t a ll_ time s keep insured , in the: amount of the full insurable value. thereof, in a responsible. insurance company or companies authorized and qualified under the laws of the State of Arkansas to assume the risk thereof, properties of the System , to the extent that such properties would be covered by insurance by private companies e~zgaged in similar types- of businesses , against loss or damage thereto from fire, lightning, tornado, wilids , riot., strike, civil commotion, malicious damage, explosion, extended coverage- and against any other loss. or damage from any other causes customarily insured against by private companies. engaged in similar types of businesses . The in- surance policies are to be taken with companies ..approved. by the Trustee , are to carry a clause making them payable to the Trustee. as an additional insured as its interest may appear, and .are either to be placed in the custody of the Trustee or satisfactory evidence of the insurance shall be filed .with the Trustee . In the event of loss, the proceeds of such insurance shall be applied solely toward the reconstruction,. replacement or repair of the System, .and in such event the City will, with reasonable promptness , .cause to be commenced and completed the reconstruction,. replacement and repair .work. ~ If such proceeds are more than sufficient for such purposes, the balance remaining shall be deposited to the credit of the Public Utility Fund, and if such proceeds shall b~ insufficient for such purposes, the. deficiency shall be supplied, first, from moneys in the Depreciation Fund, and second, from moneys in the. Operation and Maintenance Fund, and. third, from surplus.- moneys in the Public Utility n ~ Page 26 Fund. Nothing herein shall be construed as requiring the City to expend any funds for operation and maintenance of the System or for premiums on its insurance -~ ~ which are derived from. sources other than. the. operation of the System , but nothing herein shall be construed as preventing the City from doing so . Section 20. The City covenants and agrees that so long as any bonds authorized hereby are outstanding, that it will not mortgage, pledge or otherwise encumber the System, or any part thereof or any revenues derived from the operation thereof, except as herein specifically provided, and will not sell, lease or otherwise dispose of any substantial portion of the same .. Section 21. There s~iall be a statutory ~norgage lien upon the water facilities, which shall- exist in favor of the holders and registered owners- of the bonds until payment in full of the interest on anal principal of the bonds; provided, however, that such statutory mortgage lien shall be interpreted according to the decision of the Supreme Court of the State of Arkansas in City of Harrison v. Braswell, supra. Section 22. The owner or owners of all improved property lying within the area that will be served by the sewer facilities are hereby directed and required, upon written request from the City, to connect .~~11 toilet and waste water facilities of such improved property with. the sewer facilities . The required notice by the City shall be given at least thirty (30) days prior to the final date for connection, and if any property owner shall fail to make such connection after having been so requested in writing, the City hereby covenants anal agrees to institute appropriate proceedings in a court of competent juris- diction to compel such connection. Furthermore, any property. owner who fails ~br refuses to connect his improved property with the sewer facilities after having been so requested by the City shall be guilty of a misdemeaner and upon conviction shall be fined in any sum not less than $2.00 and not more than $10 , 00 , and each day's failure or refusal after the expiration of the time .~ ;~ ::.11, Page 21 fixed in the notice to make the -con:zection shall be a separate offense:; provided, however, that the provisions hereof pertaining to a misdemeanor shall be effective only in the e--vent that the City Health Officer, or other duly designated individual or board, has found and declared that .such failure on the part of any particular property owner constitutes. a hazard fio the public health and. safety of the City and its inhabitants . Section 23. (a} The City covenants and. agrees that the holders -and registered owners of the bonds shall have the protection of the provisions of Section 13 of Act N'o , 132 of the Acts of Arkansas of 1933 , as amended (Ark . Stat . Ann. §19-4113 (Rep1, 1968}) ("Act No. 132"), and the City will diligently proceed to enforce thee lien of unpaid sewer charges against the premises served by the sewer facilities and to .collect the amount due , together with the pena ity. a nd expenses authorized by Act No. 132. And, if the City shall fail to proceed within thirty (30) days. after written request shall have -been filed by the-Trustee, the Trustee may, and--upon the written request of the holders and registered owners of not less than ten percent (10%) in principal amount of the bonds then outstanding shall, proceed to enforce the lien in accordance with and pursuant to the a utliorization of Act No. 132. (b) If there be any default in the payment of tha principal of or interest on any of the bonds, or if the City defaults in any Bond Fund requirements or in the performance of any of the other covenants contained and set forth in this Ordina nce , the Trustee may, and .upon the written request of the holders and registered owners of not less than ten percent. (10%) in principal amount of the bonds then outs to nd ing s ha 11, by proper suit c ompe 1 the performance of the duties of the officials of the City under the laws of Arkansas . And in the case of a defa ult in the payment of the principal of and interest on a ny of the ~. bonds,. the Trustee may, and upon the.: written .request of holders or registered owners of not less than ten percent (10%) in principal amount of the bonds then outstanding shall, apply in a proper action to a court of competent jurisdiction 45 Page 28 .for the appointment of a receiver to administer the System on behalf of the City and the holders and registered owners with power to charge. and collect {or by mandatory injunction or othertivise to cause to be charged and collected) rates sufficient to provide for the payment of the expenses of operation, main- tenance and repair and to pay any bonds and interest outstanding and to apply the revenue in conformity with the laws of Arkansas and with this Ordinance. When aI1 defaults in principal and interest payments have been cured, the custody and opera tion of the System shall revert to the City . {c) No holder or registered owner of any of the outstanding bonds shall .have any right to institute any suit, action, mandamus or other proceed- ing in equity or in law for the protection or enforcement of any right under this Ordinance or under the laws of Arkansas unless such holder or registered owner previously shall have given to the Trustee written notice of the default omaccount of which. such suit, action or proceeding is to be taken, and unless the holders -and registered owners of not less than ten percent (10%) in principal amount of the bonds then outstandirr~ shall have made written request of the Trustee after the right to exercise such powers or right of action, as the case may be, shall have accrued, and shall have afforded the Trustee a reasonable opportunity either to proceed to exercise the powers herein granted or granted by the laws of Arkansas, or to institute such action, suit or proceeding in its name , and unless , also, there sha 11 have been offered to the Trustee rea son- able security and indemnity against the costs, expenses and liabilities to be incurred therein or thereby and the Trustee shall have refused or neglected to comply with such request within a reasonable time, and such notification, request and offer of indemnity are hereby declared in every such case, at the option of the Trustee, to be conditions precedent to the execution of the powers .. and trusts of .this Ordinance or to any other remedy hereunder. It is understood and intended that no one or more holders or registered owners of th? bonds hereby secured shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security of this Ordinance, or to ~~ i'3 g e 7, 9 enforce any right he~under except in the manner herein provided., that all proceedings a t law. or in equity shall be instituted , had and manta incd in the manner herein provided and .for the benefit of all holders and registered owners of the outstanding .bonds and coupons , and' that any individual rights of action or other right given to one or more o.f such holders and registered owners by law are restricted by this. Ordinance to the rights and remedies :~~~rein provided . (d) All rights of action under this Ordinance or under any of the bonds secured hereby, enforceable by the Trustee, may be enforced by it without the passession of anyof the bonds or coupons appertaining thereto, and any such suit, action or proceeding instituted by the Trustee shall be brought in its. na me for. the benefit of a 1.1 the holders and registered owners of such. bonds and coupons, subject to the provisions of this Ordinance . (e) No remedy herein. conferred' upon or reserved to the Trustee or to the. holders and registered owners of .the. bonds is intended to be exclusive . of any other remedy or remedies herein provided, and each and every such remedy shall be cumulative and shall be in addition fio every other remedy given hereunder or given by any other law. (f) No delay or omission of the Trustee or of any holders or registered owners of the bonds to-exercise any. right or power accrued upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and. remedy given by ,this Ordinance to the Trustee and to-the holders and registered owners- of the bonds , respectively, may be exercised from time to time and as often as may be-deemed expedient . (g) The Trustee-.may, and upon the written request of the holders and 'registered owners of -not` less than fifty percent (50°0) in principal amount of the bonds then outstanding .shall, waive any default which shall have been remedied before the entry of`final judgment or decree in any suit.,- actotz or proceeding `~ Page 3 0 instituted udder the provisions of this Ordinance or before the completion of the enforcement of any other remedy, but no such waiver shall extend to or affect any other existing or any subsequent default or defaults or impair any rights or remedies consequent thereon . Section 24. When the bonds have been executed and the seal of the City impressed as herein provided, they shall _be delivered to the Trustee and the Trustee shall authenticate them and deliver them to the purchaser upon payment of the purchase price, plus accrued interest from the date of the bonds to the dato of delivery ("total sale proceeds"). The manner of payment of the purchase price may be set forth in a letter of delivery instructions executed by the Mayor and delivered to the Trustee . , (a) The portion of the total sale proceeds ne,ce,ssary to provide for the refunding of the previous bonds shall be invested, as set forth in the letter of delivery instructions or as set forth in the Trust Agreement (identified below) , in direct or fully guaranteed securities of the United States (bea.ng any securities or guaranties of securities. supported by a pledge of the full faith and credit of the United States) with such maturities and redemption provisions as, together with available cash, will produce, as needed, sufficient moneys to pay principal, interest, an_d Trustee's and ,Paying Agent's fees on the previous bonds , as due and payable. The investment securities and cash, if any, shall be identified in a Trust Agreement executed by the Mayor and City Clerk, which Trust Agree- ment shall provide that the investment securities, and cash, if any, .shall be held in trust for the security of the previous bonds and shall provide for the _ proper handling and disbursement of moneys held .in trust thereunder for the pay- meet of principal, interest, and Trustee's and Paying Agent's fees on the previous bonds, as due and payable. The Mayor and City Clerk are authorized and directed to enter into the Trust Agreement, and such writings as may be incidental thereto, incorporating and implementing the provisions of this Section. All moneys remaining after payment and redemption of all previous bonds shall be remitted to the City for deposit and handling as set forth in this. Ordinance. Page 31 {b) The bal~-~nce of the total sale proceeds shall lac h~~n:llc~i ali:i :lisl~izr:~cc3 as follows: (1) `The accrue:i interest shall be ~eposite:l in tllc Bond l'LIIZ:I. (2) The remaining balance of the total s~~lc procecas Shc-~11 he :lc~~ositeci in a special account of the City designated "Construction Fund" ("Constr~::~tiall Fund") to be established in a .bank that is a member of the Federal Deposit Insurance Corporation selected by the City. The Construction Fund shall be disbursed solely in payment of costs and expenses of accomplishing the improvements , including , without limitation , engineering , lega 1, expenses of issuing the bonds, -and other expenses , but only on warrants , checks or vouchers signed by the Mayor or the City Clerk or the City Treasurer and the Manager of the System briefly specifying the .nature of the disbursements or expenditure, and accompanied by a certificate signed by the consulting engineer that the obligation has been incurred and to whom it is owed, except that no such certificate shall be required before payment of engineering fees, legal fees and the expenses of issuing the bonds . When the .construction of the improvements to the: System .has. been completed, this fact. shall be evidenced by the filing with the Trustee and with the depository in which the Construction Fund is deposited of a certificate .signed. by the. Manager of the System and by the consulting engineer. Upon receipt of the above-described certificate, the depository with, which the Construction Fund is deposited shall pay or transfer any remaining balances, pursuant to the written direction of the City, into the Bond Fund. Said payment or transfer shall apply against current debt service requirements of the bond fund. Section 25. (a) Moneys held for the credit of the debt- service reserve in the Bond`Fund shall be continuously invested and reinvested pursuant to the direction. of the City in direct obligations of , or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, in certificates of deposit of banks that are members of the Federal Deposit Insurance Corporation, or other investments as may be, from time to 4~ Page 32 time, permitted by law, which shall mature, or which shall be subject to redemption by the holder thereof, at the option of such holder, not later than ten (10} years after the date of such investment . (b) Moneys held for the credit of any other fund may, at the option of the City, be invested and reinvested pursuant to the direction of the City in direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, in certificates of deposit of banks that are members of the Federal Deposit Insurance Corporation, or other investments as may be from time to time permitted by law, which shall mature, or which shalt be subject to redemption by the holder thereof, at the option of such holder, not later than the date or dates when the moneys held for the credit of the particular fund will be required for, the purposes intended. (c) obligations so purchased as an investment of moneys in any such fund shalt be deemed at all fiimes to be a part of such fund and the interest accruing thereon and any profit realized from such investment shall be credited to such fund, and any loss resulting from such investment shall be charged to such fund. (d) Moneys so invested in United States Government obligations, as above defined, need not be secured by the depository bank. Section 26. Bonds and coupons for the payment or redemption of which moneys or investment securities , as hereafter defined in this Section, shall have been deposited in the Bond Fund (whether upon or prior to the maturity or the redemption date of such bonds) shall be deemed to be paid wifihin the meaning of this Indenture; provided, however, that if such bonds are to be redeemed prior to the maturity thereof, notice of such redemption shall have been duly given . "Investment securities " shall mean direct or fully guaranteed obligations of the United States of America maturing on or prior to the maturit or Y redemption date of the bonds and in determining the sufficiency of the deposit there shall be considered the principal .amount of such investment securities and interest to be earned thereon until the maturity of such investment securities . ~© Page 33 The City may at any time surrender to the `Trustee far CZncell.atiun by it any. bonds previously. autrenticated and delivered hereunder , together. with any unpaid coupons thereto belonging, which the` City may have acquired in any manner whatsoever, and such bonds and coupons , upon such.. surrender and cancellation, shall be deemed to be paid and retired. Section 27, In the..event the.. office of Mayor, City. Clerk, City.. Treasurer, Manager of the System or City Council shall be abolished, or any two or more of such offices :shall be merged or consolidated., or in `lie event the duties of a particular office shall be transferred to another office or officer,. or in the-event of a vacancy in any-.such office by reason of death, resignation, removal from office or otherwise , or in the event any such officer sl~a 11 become incapable of-performing the duties of his office by reason of sickness , absence from the City or otherwise, all powers conferred and all obligations and duties imposed upon such office or officer shall be performed by the. office or officer succeeding to the principal functions thereof, or b.y the. office-or officer upon. whom such powers, obligations and duties shall be imposed by .law . Section 28. The City covenants that it shall not take-.any action or suffer or permit any action to be taken or condition to exist which causes or may cause the interest payable on the bonds. to be subject to federal income taxation. V1Tithout limiting the generality of .the forego?_ng, the City covenants.- that the prc~ceeds of the sale'of the .bonds -will not be used directly or indirectly in such manner as to cause the bonds to be treated as "arbitrage bonds" within the .meaning of Section 1 ~ 3 (d) of the Interne 1 Revenue Code of 195 4 , as amended . Section 29. The provisions of this Ordinance shall constitute a binding contract between the-City and the holders. and registered owners of the • outstanding bonds and coupons issued hereunder, and the City will at -all times " strictly adize~-e to file terl~~s• arici provisio~7s llcreof and frilly c.lischarc~e all of its ol~li~~~ztions hcretinder. Subject. to the tc~rr~is zln~l pro~~isiorl:- co.i7t~iincd in this Ser..tion and not otllertivise, the 1lolders ~irid reg ,tercel ownors of not less thatl ~~ P~~ge 34 seventy-fivE~ ~?ercc~r~t (75"~:) in ~~gc~rec;~:`.e jirlIlClj`~c?1 ~~r110L1I1t of the boi~clS then outst~~i~ciirlg ;hc311 h~:~ve the ric~llt, fm,~l tune to tirZ~, anyt}~.ing cont~3ii~ed in this Ordir1~31zce to the co,ltrary notwithstan~~ing, to COC1Sent to ~~nc3approve the adoptio~-~ l~;' file City of such ordinance supplemental hereto as shall be necessary or desirable for the purpose of modifying, altering, amending, adding to or re- scinciing, in any particular, any of the terms or provisions containec~3 in this Ordinance or in any supplemental ordinance; provided, however, that nothing herein contained shall permit or be construed as permitting (a) an extension of the maturity of the principal of or the interest on any bond issued hereunder, or (b) a reduction i1i the principal amount of any bond or the rate of interest thereon, or (c) the creation of a lien upon or a pledge of revenues other than as expressly authorized by the appropriate provisions of this Ordinance as now adopted, or (d) the creation of a privilege of priority of any bond or bonds over any other bond or bonds , or (e) a reduction in the aggregate principal amount of the bonds required for consent to such supplemental ordinance , Section 30. The Mayor is hereby directed to.publish for one insertion in a newspaper published in the City and of general circulation therein, this Ordinance , to which shall be attached a Notice signed by him in substantially the following form: ~'a:~e 3 S NOTICE Notice is hereby given that the.:. City Council of the Cit y of Vu'est Memphis , .Arkansas , .has adopted the ordinance hereinafter set out; that the City contemplates the issuance of Public Utility Revenue Refunding and Improvement Bonds described in the Ordinance; that any person interested may appear before the Council on the day of ~ 19 76 , at o'clock , m . , at the usual meeting place of the. Council held in the City and present protests . At such hearing all objections and suggestions will be heard, and the Council will take such .action as is deemed proper in the premises . . DATED this. day of 1976. Mayor 53 Page 36 Sectioiz 31. The Trustee shall only be responsible for the exercise of good faith and reasonable prudence in the execution of its trust. Tne recitals in this Ordirlancc -and in the face of the bonds are the recitals of the City and not of the Trustee. The Trustee shall not be required to take any action as Trustee unless it shall have been revue steel to do so in writing by the holders and registered owners of not less t}.an ten percent (10%) in principal amount of the bonds of this issue then outstanding and shall have been offered rea sonablc _securit~~ aid indemnity against the costs; expenses and liabilities to be incurred t}herein or thereby. The Trustee may resign at any time by ten (10) days notice i n writing to the City Clerk and the majority in principa 1 amount of the holders and registered owners of the outstanding bon<~s of this issue at any time , with or without cause , may remove the Trustee . In the event of a va ca ncy in the office of Trustee, either by resignation or by removal, the majority in principal amount of the holdErs and registered owners of the outstanding bonds of this issue may appoint a new Trustee , such. appointment to be evidenced by a written instrument or instruments filed with the City Clerk. If the majority in principal amount of the holders .and- registered owners of the outstanding bonds ~'I of this issue shall fail to fill a vacancy within thirty (30) days after the same shall. occur, then the City shall forthwith designate a .new Trustee by~a written instrument filed~in the office of the -City Clerk. The original Trustee and any successor Trustee shall file. a written acceptance and agree me nu to execute the trust imposed upon it or them by this Ordinance , but only upon the terms and conditions sEt forth in this Ordinance and subject to the provisions of this Ordinance, to all of which the respective holders and registered owners of the bonds agree . Such written accepta nee shall be Tiled with the City Clerk and a~ copy thereof shall be placed in the bond transcript. Any successor Trustee -a °~ ~ shall have all the powers herein granted. to the original,Trustee. In the event of a change in the office of Trustee, the old Trustee which has resigned or been removed shall cease to be Paying Agent. ~4 Pa g:~ 3 7 S~ciion 3~ , This C~rdirlance shall not crate any right of any i:ind and no right of any kind .shall arise hereunder pursuant to it until t'r~e bonds a uthoriled by t}Zs trdinance sha 11 be issued and delive-red . 5nttion 33. If any provision cif t}Zis Ordinance shall for arly reason be declared. to~13e illegal or invalid, such declaration shall not affect the validity of the remainder of the provisions of the Ordinance and. to that event a 11 provisions of this Ordinance are hereby declared to be severable . _. Section 34. A11 ordinances, resolutions and parts thereof in conflict herewith, including. specifically any parts of the ordinances and resolutions authorizing and. pertaining to the previous bonds, that are in conflict herewith are hereby repealed to the extent of suc,.h conflict. SECtion 35. It is hereby ascertainEd and declared thaw an immediate need e~ist.s for thr: refunding of the indebtedness evidenced by t}Ze previous bonds, in order that the savings and other significant benefits may be realized.. it is , t}~erefore, declared that an emergency exists, and this Ordinance being nE ce s sa ry for the mined is to preservation of .the. public. peace , health and safety shall take effect and-be in ford from and after its passage. There being. no further business, Alderman Bentley, seconded by Alderman King, moved to adjourn. Upon .vote,. the voting was as follows: Aye: Aldermen: ..Bentley, Cosgrove, Dickerson, Hightower, Holt, Horton, King, and Rodgers.. Nay: None. Aldermen Grimsley and Harris were not present for voting. ~~ MAYOR ATTEST CITY CLERK APPROVED: ~~n,ended Alderman Cosgrove, Chairman of the Insurance Committee, requested the bid be referred to legal counsel for interpretation, and then back. to the Committee. MAY 6, 1976