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HomeMy WebLinkAboutA043 - Resolution No. 23-003 adopted January 10, 2023 Aires 1419370-71/2'0'/z Iss—Sewer Rev.(Series 2023 A) (Issuance - Revenue) 419370-71 I Ames, Iowa January 10, 2023 A meeting of the City Council of the City of Ames, Iowa, was held on January 10, 2023, at 6:00 o'clock p.m., at the Council Chambers— City Hall, Ames, Iowa. i The meeting was called to order by the Mayor, and the roll was called showing the following Council Members present and absent: Present: Betcher, Beatty-Hansen, Corrieri, Gartin, Junck, Rollins Absent: None The City Council tools up for consideration a resolution authorizing and approving a Loan and Disbursement Agreement and providing for the issuance and securing the payment of Sewer Revenue Bonds, Series 2023A. After due consideration and discussion, Council Member Beatty-Hansen introduced the following resolution and moved its adoption, seconded by Council Member Corrieri. The Mayor put the question upon the adoption of said resolution, and the roll being called, the following Council Members voted: Ayes: Betcher, Beatty-Hansen, Corrieri, Gartin, Jimcic, Rollins Nays: None ' Whereupon, the Mayor declared the resolution duly adopted as hereinafter set out. -I- DORSEY &WHITNEY LLP,ATTORNEYS, DES MOINES,IOWA Ames/419370-71 /2n"Yx lss—Sewer Rev.(Series 2023A) i RESOLUTION NO. 23-003 Resolution authorizing and approving a Loan and Disbursement Agreement and providing for the issuance and securing the payment of $4,071,000 Sewer Revenue Bonds, Series 2023A WHEREAS, the City of Ames (the "City"), in Story County, State of Iowa, did heretofore establish a Municipal Sanitary Sewer System (the "Utility") in and for the City which has continuously supplied sanitary sewer service in and to the City and its inhabitants since its establishment; and WHEREAS, the management and control of the Utility are vested in the City Council (the "Council") and no board of trustees exists for this purpose; and WHEREAS, pursuant to a prior resolution of the Council, the City has heretofore issued its $3,121,000 Sewer Revenue Bond, SRF Series 2012, dated November 16, 2012 (the "Series 2012 Bond"), a portion of which remains outstanding; and WHEREAS, pursuant to a prior resolution of the Council, the City has heretofore issued its $797,000 Taxable Sewer Revenue Bond, SRF Series 2016, dated September 30, 2016 (the "Series 2016 Bond"), a portion of which remains outstanding; and WHEREAS, pursuant to a prior resolution of the Council, the City has heretofore issued its $1,001,000 Taxable Sewer Revenue Bond, SRF Series 2018, dated February 16, 2018 (the "Series 2018 Bond"), a portion of which remains outstanding; and WHEREAS, pursuant to a prior resolution of the Council, the City has heretofore issued its $5,107,055.19 Taxable Sewer Revenue Improvement and Refunding Bond, SRF Series 2021, dated February 19, 2021 (the "Series 2021 Bond"), a portion of which remains outstanding; and WHEREAS, pursuant to the resolutions (the "Prior Bond Resolutions") authorizing the issuance of the Series 2012 Bond, the Series 2016 Bond, the Series 2018 Bond and the Series 2021 Bond (collectively, the "Prior Bonds"), the City reserved the right to issue additional obligations payable from the Net Revenues (as defined herein) of the Utility and ranking on a parity with the Prior Bonds under the terms and conditions set forth in the Prior Bond Resolutions; and WHEREAS, the City has heretofore proposed to contract indebtedness and enter into a certain Sewer Revenue Loan and Disbursement Agreement (the "Agreement") and to borrow money thereunder in a principal amount not to exceed $12,700,000, pursuant to the provisions of Section 384.24A of the Code of Iowa, for the purpose of paying the cost, to that extent, of planning, designing and constructing improvements and extensions to the Utility (the "Project'), and has published notice of the proposed action and has held a hearing thereon on November 22, 2022; and _2_ DORSEY &WHITNEY LLP,ATTORNEYS, DES MOINES,IOWA Amcs/419370-71/2""Y:Iss—Sewer Rev.(Series 2023A) WHEREAS, the City has determined to split its authority to borrow under the Agreement into a tax-exempt loan and disbursement agreement (the "Series 2023A Agreement") and a taxable loan and disbursement agreement (the"Series 2023B Agreement"); and WHEREAS, it is necessary at this time for the Council to approve the Series 2023A Agreement with the Iowa Finance Authority, an agency and public instrumentality of the State of Iowa, as lender (the "Lender") and to issue Sewer Revenue Bonds, Series 2023A (the "Series 2023A Bonds") in evidence thereof in the principal amount of $4,071,000 in order to pay the costs of the Project; and WHEREAS, in conjunction with the issuance of the Series 2023A Bonds, the City intends to adopt a resolution (the "Series 2023B Bond Resolution" and, collectively with the Prior Bond Resolutions, the "Outstanding Bond Resolutions") authorizing the issuance of Taxable Sewer Revenue Bonds, Series 2023B (the "Series 2023B Bonds" and, collectively with the Prior Bonds, the "Outstanding Bonds") in evidence of its obligations under the Series 2023B Agreement, payable from the Net Revenues of the Utility and ranking on a parity with the Series 2023A Bonds; NOW, THEREFORE, Be It Resolved by the City Council of the City of Ames, Iowa, as follows: Section 1. It is hereby determined that the City shall enter into the Series 2023A Agreement with the Lender. The Series 2023A Agreement shall be in substantially the form as has been placed on file with the City and shall provide for a loan (the "Loan") to the City in the amount of$4,071,000, for the purpose as set forth in the preamble hereof. The Mayor and City Clerk are hereby authorized and directed to sign the Series 2023A Agreement on behalf of the City, and the Series 2023A Agreement is hereby approved. Section 2. The Series 2023A Bonds are hereby authorized to be issued in evidence of the obligation of the City under the Series 2023A Agreement, in the aggregate principal amount of$4,071,000, to be dated the date of delivery to or upon the direction of the Lender, and bearing interest from the date of each advancement made at the rate of 1.75% per annurn pursuant to the Series 2023A Agreement, until payment thereof, as set forth in Exhibit A attached to the Series 2023A Agreement, I The Series 2023A Bonds may be in the denomination of $1,000 each or any integral multiple thereof and, at the request of the Lender, shall be initially issued as a single bond in the denomination of$4,071,000 and numbered R-1. The City Clerk is hereby designated as the Registrar and Paying Agent for the Serie s 2023A Bonds and may be hereinafter referred to as the "Registrar" or the "Paying Agent." Payment of the principal of and interest on the Series 2023A Bonds and premium, if any, shall be payable at the office of the Paying Agent to the registered owners thereof appearing on the registration books of the City. All such payments, except full redemption, shall be made to the registered owners appearing on the registration books at the close of business on the fifteenth -3- DORSEY &WHITNEY LLP, ATTORNEYS,DES MOINES,IOWA Ames/419370-71/2'"%,Iss—Sewer Rev.(Series 2023A) day of the month next preceding the payment date. Final payment of principal shall only be made upon surrender of the Bond or Bonds to the Paying Agent. i In addition to the payment of principal of and interest on the Series 2023A Bonds, the City also agrees to pay the Initiation Fee and the Servicing Fee (defined in the Series 2023A Agreement) in accordance with the terms of the Series 2023A Agreement. The Series 2023A Bonds shall be executed on behalf of the City with the official manual or facsimile signature of the Mayor and attested with the official manual or facsimile signature of the City Clerk, and shall be fully registered bonds without interest coupons. The issuance of the Series 2023A Bonds and the amount of the Loan advanced thereunder shall be recorded in the office of the City Treasurer, and the certificate on the back of each Bond shall be executed with the official manual or facsimile signature of the City Treasurer. In case any officer whose signature or the facsimile of whose signature appears on the Series 2023A Bonds shall cease to be such officer before the delivery of such Series 2023A Bonds, such signature or such facsimile signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. The Series 2023A Bonds shall be fully registered as to principal and interest in the names of the owners on the registration books of the City kept by the Registrar. Each Bond shall be transferable without cost to the registered owner thereof only upon the registration books of the City upon presentation to the Registrar, together with either a written instrument of transfer satisfactory to the Registrar or the assignment form thereon completed and duly executed by the registered owner or the duly authorized attorney for such registered owner. The record and identity of the owners of the Series 2023A Bonds shall be kept confidential as provided by Section 22.7 of the Code of Iowa. The Series 2023A Bonds are subject to optional redemption by the City at a price of par plus accrued interest (i) on any date with the prior written consent of the Lender, or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of the Series 2023A Bonds by the City may be made from any funds regardless of source, in whole or from time to time in part, in inverse order of maturity upon not less than thirty (30) days' notice of redemption by e-mail, facsimile, certified or registered mail to the Lender (or any other registered owner of the Series 2023A Bonds). The Series 2023A Bonds are also subject to mandatory redemption as set forth in Section 5 of the Series 2023A Agreement. All of the Series 2023A Bonds and the interest thereon, together with the Outstanding Bonds and any additional obligations as may be hereafter issued and outstanding from time to time ranking on a parity therewith under the conditions set forth herein (which additional obligations are hereinafter sometimes referred to as "Parity Obligations"), shall be payable solely from the Net Revenues of the Utility and the Sinking Fund hereinafter referred to, both of which are hereby pledged to the payment of the Series 2023A Bonds. The Series 2023A Bonds shall be a valid claim of the owners thereof only against said Net Revenues and Sinking Fluid. None of the Series 2023A Bonds shall be a general obligation of the City, nor payable in any manner by taxation, and under no circumstances shall the City or the Utility be in any manner liable by -4- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES, IOWA Ames/419370-71/2'4 A Iss—Sewer Rev.(Series 2023A) reason of the failure of the Net Revenues of the Utility to be sufficient for the payment in whole or in part of the Series 2023A Bonds and the interest thereon. Section 3. The Series 2023A Bonds shall be executed as herein provided as soon after the adoption of this resolution as may be possible and thereupon they shall be delivered to the Registrar for registration and delivery to the Lender, upon receipt of the loan proceeds (the "Loan Proceeds"), and all action heretofore taken in connection with the Series 2023A Agreement is hereby ratified and confirmed in all respects. I Section 4. The Series 2023A Bonds shall be in substantially the following form: -5- DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71 /2"°'AI ss—Sewer Rev.(Series 2023 A) (Form of Bond) UNITED STATES OF AMERICA STATE OF IOWA STORY COUNTY CITY OF AMES SEWER REVENUE BOND, SERIES 2023A No. R-1 $4,071,000 RATE MATURITY DATE BOND DATE 1.75% June 1, 2042 January 27, 2023 The City of Ames (the "City"), in Story County, State of Iowa, for value received, promises to pay from the source and as hereinafter provided, on the maturity date of this Bond to IOWA FINANCE AUTHORITY or registered assigns, the principal surn of FOUR MILLION SEVENTY-ONE THOUSAND DOLLARS Interest at the rate specified above shall be payable semiannually on June 1 and December 1 of each year, commencing June 1, 2023, and principal shall be due and payable in installments in the amounts shown on the Principal Payment Schedule, attached hereto as Exhibit A, on June 1, 2023, and amorally thereafter on June 1 in each year until the principal and interest are fully paid, except that the final installments of the entire balance of principal and interest, if not sooner paid, shall become due and payable on June 1, 2042. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. The City Clerk shall act as Registrar and Paying Agent and may be. hereinafter referred to as the "Registrar" or the "Paying Agent." Payment of the principal of and interest on this Bond and premium, if any, shall be payable at the office of the Paying Agent to the registered owners thereof appearing on the registration books of the City at the addresses shown on such registration books. All such payments, except full redemption, shall be made to the registered owners appearing on the registration books at the close of business on the fifteenth day of the month next preceding the payment date. Final payment of principal shall only be made upon surrender of this Bond to the Paying Agent. This Bond is one of a series of bonds (the "Bonds") issued by the City to evidence its obligation under a certain Loan and Disbursement Agreement, dated the date hereof (the "Agreement") entered into by the City for the purpose of providing funds to pay a portion of the -6- DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71 /2""'/:Iss—Sewer Rev.(Series 2023A) cost of planning, designing and constructing improvements and extensions (the "Project") to the Municipal Sanitary Sewer System of the City (the "Utility"). The Bonds are issued pursuant to and in strict compliance with the provisions of 1 Sections 384.24A and 384.83 of the Code of Iowa, 2021, and all other laws amendatory thereof and supplemental thereto, and in conformity with a resolution of the City Council authorizing and approving the Agreement and providing for the issuance and securing the payment of the Bonds (the "Resolution"), and reference is hereby made to the Resolution and the Agreement for a more complete statement as to the source of payment of the Bonds and the rights of the owners of the Bonds. The Bonds shall be subject to optional redemption by the City at a price of par plus accrued interest (i) on any date with the prior written consent of the Iowa Finance Authority, or (ii) in the event that all or substantially all of the Project is damaged or destroyed. Any optional redemption of the Bonds by the City may be made from any fiends regardless of source, in whole or from time to time in part, in inverse order of maturity upon not less than thirty (30) days' notice of redemption by e-mail, facsimile, certified or registered mail to the Iowa Finance I� Authority (or any other registered owner of the Bonds). The Bonds are also subject to mandatory redemption as set forth in Section 5 of the Agreement. The Bonds are not general obligations of the City but, together with the City's outstanding Sewer Revenue Bond, SRF Series 2012, dated November 16, 2012; Taxable Sewer Revenue Bond, SRF Series 2016, dated September 30, 2016; Taxable Sewer Revenue Bond, SRF Series 2018, dated February 16, 2018; Taxable Sewer Revenue Improvement and Refunding Bond, SRF Series 2021, dated February 19, 2021; Taxable Sewer Revenue Bonds, Series 2023B, dated January 27, 2023 and any additional obligations as may be hereafter issued and outstanding from time to time ranking on a parity therewith under the conditions set forth in the Resolution, are payable solely and only out of the future Net Revenues (as defined in the Resolution) of the Utility of the City, a sufficient portion of which has been ordered set aside and pledged for that purpose. This Bond is not payable in any manner by taxation, and under no circumstances shall the City be in any manner liable by reason of the failure of the said Net Revenues to be sufficient for the payment of this Bond and the interest thereon. This Bond is fully negotiable but shall be fully registered as to both principal and interest in the name of the owner on the books of the City in the office of the Registrar, after which no transfer shall be valid unless made on said books and then only upon presentation of this Bond to the Registrar, together with either a written instrument of transfer satisfactory to the Registrar or the assignment form hereon completed and duly executed by the registered owner or the duly authorized attorney for such registered owner. The City, the Registrar and the Paying Agent may deem and treat the registered owner hereof as the absolute owner for the purpose of receiving payment of or on account of principal hereof, premium, if any, and interest due hereon and for all other purposes, and the City, the Registrar and the Paying Agent shall not be affected by any notice to the contrary. And It Is Hereby Certified, Recited and Declared that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of the Bonds have -7- DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71/2" AI ss—Sewer Rev,(Series 2023A) existed, have happened and have been performed in due time, form and manner, as required by law, and that the issuance of the Bonds does not exceed or violate any constitutional or statutory limitation or provision. IN TESTIMONY WHEREOF, the City of Ames, Iowa, has caused this Bond to be executed by its Mayor and attested by its City Clerk, all as of the Bond Date. i CITY OF AMES, IOWA i i By (Do Not Sign) Mayor I Attest: (Do Not Sign) City Clerk (On the back of each Bond the following certificate shall be executed with the duly authorized signature of the City Treasurer) STATE OF IOWA STORY COUNTY SS: CITY TREASURER'S CERTIFICATE CITY OF AMES The original issuance of the Bonds, of which this Bond is a part, was duly and properly recorded in my office as of the Bond Date. (Do Not Sign) City Treasurer 8 DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71 /2""Vz Iss—Sewer Rev.(Series 2023A) ABBREVIATIONS The following abbreviations, when used in this Bond, shall be eonstnred as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common UTMA TEN ENT - as tenants by the entireties (Custodian) JT TEN - as joint tenants with right of As Custodian for survivorship and not as (Minor) tenants in common under Uniform Transfers to Minors Act (State) Additional abbreviations may also be used though not in the list above. ASSIGNMENT For valuable consideration, receipt of which is hereby acknowledged, the undersigned assigns this Bond to (Please print or type name and address of Assignee) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE and does hereby irrevocably appoint Attorney, to transfer this Bond on the books kept for registration thereof with full power of substitution. Dated: Signature guaranteed: NOTICE: The signature to this Assignment must correspond with the name of the registered owner as it appears on this Bond in every particular, without alteration or enlargement or any change whatever. -9- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Anres/419370-71/2""'A Iss—Sewer Rev.(Series 2023A) EXHIBIT A PRINCIPAL PAYMENT SCHEDULE Due Due Jule 1 Amount June 1 Amount 2023 $ 1,000 2033 $213,000 2024 $178,000 2034 $217,000 2025 $182,000 2035 $222,000 2026 $185,000 2036 $226,000 2027 $189,000 2037 $230,000 2028 $193,000 2038 $235,000 2029 $197,000 2039 $240,000 2030 $201,000 2040 $245,000 2031 $205,000 2041 $249,000 2032 $209,000 2042 $254,000 -10- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA i i Ames/419370-71 /2itl%x Is —Sewer Rev.(Series 2023A) I Section 5. The Loan Proceeds shall be held by the Lender and disbursed for costs of the Project, as referred to in the preamble hereof. The City will keep a detailed segregated accounting of the expenditure of the Loan Proceeds. Section 6. So long as any of the Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations are outstanding, the City shall continue to maintain the Utility in good condition, and the Utility shall continue to be operated in an efficient manner and at a reasonable cost as a revenue producing undertaking. The City shall establish, impose, adjust and provide for the collection of rates to be charged to customers of the Utility, including the City, to produce gross revenues (hereinafter sometimes referred to as the "Gross Revenues") at least sufficient to pay the expenses of operation and maintenance of the Utility, which shall include salaries, wages, cost of maintenance and operation, materials, supplies, insurance and all other items normally included under recognized accounting practices (but does not include allowances for depreciation in the valuation of physical property) (which such expenses are hereinafter sometimes referred to as the "Operating Expenses") and to leave a balance of net revenues (herein referred to as the "Net Revenues") equal to at least 110% of the principal of and interest on all of the Series 2023A Bonds, the Outstanding Bonds and any other Parity Obligations due in such fiscal year, as the same become due. Section 7. The provisions, covenants, undertakings and stipulations for the operation of the Utility and for the collection, application and use of the Gross Revenues and income from such operation, as set forth in the Outstanding Bond Resolutions shall imne and appertain to the Series 2023A Bonds to the same extent and with like force and effect as if herein set out in full, except only insofar as the same may be inconsistent with this resolution. Nothing in this resolution shall be construed to impair the rights vested in the Outstanding Bonds. The amounts herein required to be paid into the various funds hereafter named shall be inclusive of said payments required with respect to the Outstanding Bonds. The provisions of the Outstanding Bond Resolutions and the provisions of this resolution are to be construed whenever possible so that the same will not be in conflict. In the event such construction is not possible, the provisions of the resolution first adopted shall prevail until such time as the obligations authorized by such resolution have been paid or otherwise satisfied as therein provided, at which time the provisions of this resolution shall again prevail. Section 8. From and after the issuance of the Series 2023A Bonds, the Gross Revenues of the Utility shall continue to be set aside into the City's Sewer Revenue Fund ("Sewer Revenue Fund") created under the Outstanding Bond Resolutions. The Sewer Revenue Fund shall be used in maintaining and operating the Utility, and after payment of the Operating Expenses shall, to the extent provided in this resolution and the Outstanding Bond Resolutions, be used to pay the principal of and interest on the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations, and to create and maintain the several separate funds hereinafter described. Section 9. The provisions in and by the Outstanding Bond Resolutions, whereby there has been created and is to be maintained a Sewer Revenue Bond Sinking Fund (herein referred to as the "Sinking Fund"), and for the payment into said fund from the Net Revenues of the Utility such portion thereof as will be sufficient to pay the interest on and principal of the -11- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES, IOWA i I Ames/419370-71/2"''/Iss—Sewer Rev,(Series 2023A) Outstanding Bonds, are all hereby ratified and confirmed, and all such provisions shall inure and constitute the security for the payment of the interest on and principal of the Series 2023A Bonds hereby authorized as may be outstanding from time to time; provided, however that on the first day of each month of each year, the minimum amount to be set aside, in addition to the amounts required to be set aside in the Outstanding Bond Resolutions, and paid into the Sinking Fund shall be not less than as follows: Commencing on February 1, 2023, and continuing to and including May 1, 2023, an amount equal to 1/4th of the installment of interest coming due on June 1, 2023, and thereafter, commencing on June 1, 2023, and continuing to final maturity, an amount equal to 1/6th of the installment of interest coming due on the next succeeding interest payment date on the then outstanding Series 2023A Bonds. In addition, commencing on February 1, 2023 and continuing to and including May 1, 2023, an amount equal to 1/4th of the installment of principal coming due on June 1, 2023, and thereafter, commencing on June 1, 2023, and continuing to final maturity, an amount equal to 1/12th of the installment of principal coming due on such Series 2023A Bonds on the next succeeding principal payment date until the full amount of such installment is on deposit in the Sinking Fund. Money in the Sinking Fund shall be used solely for the purpose of paying principal of and interest on the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations as the same shall become due and payable. Whenever Parity Obligations are issued under the conditions and restrictions hereinafter set forth, provision shall be made for additional payments to be made into the Sinking Fund for the purpose of paying the interest on and principal of such Parity Obligations. If at any time there should be a failure to pay into the Sinking Fund the full amount above stipulated, then an amount equivalent to the deficiency shall be paid into the Sinking Fund from the Net Revenues of the Utility as soon as available, and the same shall be in addition to the amount otherwise required to be so set apart and paid into the Sinking Fund. No further payments need be made into the Sinking Fund when and so long as the amount therein is sufficient to retire all of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations then outstanding which are payable from the Sinking Fund and to pay all interest to become due thereon prior to such retirement, or if provision for such payment has been made. All of such payments required to be made into the Sinking Fund shall be made in equal monthly installments on the first day of each month, except that when the first day of any month shall be a Sunday or legal holiday, then such payments shall be made on the next succeeding secular day. Section 10. The provisions in and by the Outstanding Bond Resolutions whereby there has been created and is to be maintained a special ftiid to be known and designated as the Surplus Fund into which there shall be set apart and paid all of the Net Revenues remaining after first paying the Operating Expenses and malting the required payments into the Sinking Fund are -12- DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames 1419370-71 /2i11 Y Iss—Sewer Rev.(Series 2023A) all hereby ratified and confirmed. All money credited to the Surplus Fund shall be transferred and credited to the Sinking Fund whenever necessary to prevent or remedy a default in the payment of the principal of or interest on the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations. As long as the Sinking Fund has the frill amounts required to be deposited therein by the Outstanding Bond Resolutions and this resolution, any balance in the Surplus Fund may be expended by the City in such manner as the Council, or such other duly constituted body as may then be charged with the operation of the Utility, may from time to time direct. Section 11. All money held in any fund or account created or to be maintained under the terms of this resolution shall be deposited in lawful depositories of the City or invested in accordance with Chapters 12B and 12C of the Code of Iowa and continuously held and secured as provided by the laws of the State of Iowa relating to the depositing, securing, holding and investing of public funds. All interest received by the City as a result of investments under this section shall be considered to constitute Gross Revenues of the Utility and shall be deposited in or transferred to the Sewer Revenue Fetid and used solely and only for the purposes specified herein for such funds. Section 12. The City hereby covenants and agrees with the owner or owners of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations, or any of them, that from time to time may be outstanding, that it will faithfully and punctually perform all duties with reference to the Utility required and provided by the Constitution and laws of the State of Iowa, that it will segregate the Gross Revenues of the Utility and make application thereof in accordance with the provisions of this resolution and that it will not sell, lease or in any manner dispose of the Utility or any part thereof, including any and all extensions and additions that may be made thereto, until all of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations shall have been paid in full, both principal and interest, or unless and until provision shall have been made for the payment of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations and interest thereon in full; provided, however, that the City may dispose of any property which in the judgment of the Council, or such duly constituted body as may then be charged with the operation of the Utility, is no longer useful or profitable in the operation of the Utility nor essential to the continued operation thereof and when the sale thereof will not operate to reduce the revenues to be derived from the operation of the Utility. Section 13. Upon a breach or default of a term of the Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations, the Outstanding Bond Resolutions and this resolution, a proceeding may be brought in law or in equity by suit, action or mandamus to enforce and compel performance of the duties required under the terms of this resolution and Division V of Chapter 384 of the Code of Iowa or an action may be brought to obtain the appointment of a receiver to take possession of and operate the Utility and to perform the duties required by this resolution and Division V of Chapter 384 of the Code of Iowa. Section 14. The Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations shall not be entitled to priority or preference one over the other in the application of the Net Revenues of the Utility regardless of the time or times of the issuance of such Series 2023A Bonds, the Outstanding Bonds or Parity Obligations, it being the intention of the City that -13- DORSEY & WHITNEY LLP, ATTORNEYS,DES MOINES,IOWA Ames/419370-71 /2""'/,Iss—Sewer Rev.(Series 2023A) there shall be no priority among the Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations, regardless of the fact that they may have been actually issued and delivered at different times. The City hereby reserves the right and privilege of issuing additional Parity Obligations. Section 15. The City agrees that so long as the Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations remain outstanding, it will maintain insurance for the benefit of the owners of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations on the insurable portions of the Utility of a kind and in an amount which usually would be carried by private companies or municipalities engaged in a similar type of business. The proceeds of any insurance, except public liability insurance, shall be used to repair or replace the part or parts of the Utility damaged or destroyed. The City will keep proper books of record and account, separate from all other records and accounts, showing the complete and correct entries of all transactions relating to the Utility, and the owners of the Series 2023A Bonds, the Outstanding Bonds or any Parity Obligations shall have the right at all reasonable times to inspect the Utility and all records, accounts and data of the City relating thereto. Section 16. The provisions of this resolution shall constitute a contract between the City and the owners of the Series 2023A Bonds and any Parity Obligations as may from time to time be outstanding, and after the issuance of the Series 2023A Bonds, no change, variation or alteration of any kind of the provisions of this resolution shall be made which will adversely affect the owners of the Series 2023A Bonds or any Parity Obligations until all of the Series 2023A Bonds, the Outstanding Bonds and any Parity Obligations and the interest thereon shall l have been paid in full, except as hereinafter provided. The owners of a majority in principal amount of the Series 2023A Bonds and any Parity Obligations at any time outstanding (not including in any case any obligations which may then be held or owned by or for the account of the City, but including such obligations as may be issued for the purpose of refunding any of the Series 2023A Bonds, the Outstanding Bonds or Parity Obligations if such obligations shall not then be owned by the City) shall have the right from time to time to consent to and approve the adoption by the City of a resolution or resolutions modifying or amending any of the terms or provisions contained in this resolution; provided, however, that this resolution may not be so modified or amended in such manner as to: (a) Make any change in the maturity or redemption terms of the Series 2023A Bonds or Parity Obligations. (b) Make any change in the rate of interest bome by any of the Series 2023A Bonds or Parity Obligations. (c) Reduce the amount of the principal payable on any Series 2023A Bonds or Parity Obligations. (d) Modify the terms of payment of principal of or interest on the Series 2023A Bonds or Parity Obligations, or any of them, or impose any conditions with respect to such payment. -14- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71/2"°'h Iss—Sewer Rev.(Series 2023A) (e) Affect the rights of the owners of less than all of the Series 2023A Bonds or Parity Obligations then outstanding. (f) Reduce the percentage of the principal amount of the Series 2023A Bonds or Parity Obligations, the consent of the owners of which shall be required to effect a further modification. Whenever the City shall propose to amend or modify this resolution under the provisions of this section, it shall cause notice of the proposed amendment to be (1) filed with the Lender and (2) mailed by certified mail to each registered owner of any Bond or Parity Obligation as shown by the records of the Registrar. Such notice shall set forth the nature of the proposed amendment and shall state that a copy of the proposed amendatory resolution is on file in the office of the City Clerk. Whenever at any time within one year from the date of the mailing of said notice, there shall be filed with the City Clerk an instrument or instruments executed by the owners of at least a majority in aggregate principal amount of the Series 2023A Bonds and any Parity Obligations outstanding at the time of the adoption of such amendatory resolution specifically consenting to the adoption thereof as herein provided, no owner of any Series 2023A Braids or Parity Obligations shall have any right or interest to object to the adoption of such amendatory resolution or to object to any of the terms or provisions therein contained or to the operation thereof or to enjoin or restrain the City from taking any action pursuant to the provisions thereof. Any consent given by the owners of a Bond or Parity Obligation pursuant to the provisions of this section shall be irrevocable for a period of six (6) months from the date of such consent and shall be conclusive and binding upon all future owners of the same Bond or Parity Obligation during such period. Such consent may be revoked at any time after six (6) months from the date of such consent by the owner who gave such consent or by a successor in title, but such revocation shall not be effective if the owners of a majority in aggregate principal amount of the Series 2023A Bonds and Parity Obligations outstanding as in this section defined shall have, prior to the attempted revocation, consented to and approved the amendatory resolution referred to in such revocation. The fact and date of the execution of any instrument Linder the provisions of this section may be proved by the certificate of any officer in any jurisdiction, who by the laws thereof is authorized to take acknowledgments of deeds within such jurisdiction, that the persons signing such instrument acknowledged before such officer the execution thereof, or may be proved by an affidavit of a witness to such execution sworn to before such officer. Section 17. It is the intention of the City that interest on the Series 2023A Bonds be and remain excluded from gross income for federal income tax purposes pursuant to the appropriate provisions of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations in effect with respect thereto (all of the foregoing herein referred to as the "Internal Revenue Code"). In furtherance thereof the City covenants to comply with the provisions of the Internal Revenue Code as they may from time to time be in effect or amended and further covenants to comply with applicable future laws, regulations, published rulings and court decisions as may be necessary to insure that the interest on the Series 2023A Bonds will remain -15- DORSEY & WHITNEY LLP,ATTORNEYS,DES MOINES, IOWA Ames/419370-71/2" 1/z Iss—Sewer Rev.(Series 2023A) excluded from gross income for federal income tax purposes. Any and all of the officers of the City are hereby authorized and directed to take any and all actions as may be necessary to comply with the covenants herein contained. Section 18. If any section, paragraph, clause or provision of this resolution shall be held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of the remaining provisions of this resolution. Section 19. All resolutions and orders or parts thereof in conflict with the provisions of this resolution are, to the extent of such conflict, hereby repealed. Section 20. This resolution shall be in frill force and effect inunediately upon its adoption and approval, as provided by law. Passed and approved January 10, 2023. Mayor Attest: City Clerk On motion and vote, the meeting adjourned. Mayor Attest: City Clerk -16- DORSEY& WHITNEY LLP,ATTORNEYS,DES MOINES, IOWA I Ames/419370-71/2'0�/:Iss—Sewer Rev.(Series 2023A) ATTESTATION CERTIFICATE: i STATE OF IOWA STORY COUNTY SS: CITY OF AMES i I, the undersigned, City Clerk of the City of Ames, do hereby certify that I have in my possession or have access to the complete corporate records of the aforesaid City and of its Council and officers and that I have carefully compared the transcript hereto attached with the aforesaid corporate records and that the transcript hereto attached is a true, correct and complete copy of all the corporate records in relation to the authorization and approval of a certain Sewer Revenue Loan and Disbursement Agreement (the "Series 2023A Agreement") and the issuance of $4,071,000 Sewer Revenue Bonds, Series 2023A (the "Series 2023A Bonds") of said City evidencing the City's obligation under such Series 2023A Agreement and that the transcript hereto attached contains a true, correct and complete statement of all the measures adopted and proceedings, acts and things had, done and performed up to the present time with respect thereto. I further certify that no objections were filed in my office and no objections of any kind were made to the matter of entering into such Series 2023A Agreement or issuing such Series 2023A Bonds at the time and place set for hearing thereon, and that no petition of protest or objections of any kind have been filed or made, nor has any appeal been taken to the District Court from the decision of the City Council to enter into the Series 2023A Agreement or to issue the Series 2023A Bonds. WITNESS MY HAND this day of 2023. City Cl rk I I -17- DORSEY &WHITNEY LLP,ATTORNEYS,DES MOINES,IOWA Ames/419370-71 /2itl Y Iss—Sewer Rev.(Series 2023A) ESTABLISHMENT CERTIFICATE: STATE OF IOWA STORY COUNTY SS: CITY OF AMES I, the undersigned, City Clerk of the City of Ames, do hereby certify that I have complete access and control of all of the corporate records of the City and that, based upon my examination of such records, I have determined that the City did heretofore establish a Municipal Sanitary Sewer System (the "Utility"), that the management and control of the Utility are vested in the City Council, and that no board of trustees exists which has any part of the control and management of such Utility. I further certify that there is not pending or threatened any question or litigation whatsoever touching the establishment, improvement or operation of such Utility and that there are no bonds or other obligations of any kind now outstanding which are payable from or constitute a lien upon the revenues derived from the operation of such Utility, except for the City's outstanding Sewer Revenue Bond, SRF Series 2012, dated November 16, 2012; Taxable Sewer Revenue Bond, SRF Series 2016, dated September 30, 2016; Taxable Sewer Revenue Bond, SRF Series 2018, dated February 16, 2018; Taxable Sewer Revenue Improvement and Refunding Bond, SRF Series 2021, dated February 19, 2021; and the current issue of$4,071,000 Sewer Revenue Bonds, Series 2023A and $8,357,000 Taxable Sewer Revenue Bonds, Series 2023B of the City. WITNESS MY HAND this day of 2023. I City Clerk -18- DORSEY & WHITNEY LLP, ATTORNEYS,DES MOINES,IOWA