O-779-93 04/12/93AO
VILLAGE OF LEMONT
ORDINANCE NO. 7 79
An Ordinance authorizing and providing for the issue of
$160,000 Waterworks and Sewerage Refunding Revenue Bonds,
Series 1993, of the Village of Lemont, Cook, DuPage and Will
Counties, Illinois, for the purpose of refunding outstanding
Waterworks and sewerage revenue bonds of said Village,
prescribing all the details of said bonds, and providing for the
collection, secregagation and sistribution of the revenues of the
combined waterworks and sewerage system of said Village.
ADOPTED BY THE
PRESIDENT AND BOARD OF TRUSTEES
OF THE VILLAGE OF LEMONT
This G� day of
Published in pamphlet form by
authority of the President and
Board of Trustees of the Village of
Lemont, Counties of Cook, Will, and
DuPage, linois, this /Q
day of 1993
1993.
:TA rt,,A Vi, c. Y
ORDINANCE NO: 11'
AN ORDINANCE authorizing and providing for the issue of
$160,000 Waterworks and Sewerage Refunding Revenue Bonds,
Series 1993, of the Village of Lemont, Cook, DuPage and Will
Counties, Illinois, for the purpose of refunding outstanding
waterworks and sewerage revenue bonds of said Village,
prescribing all the details of said bonds, and providing for the
collection, segregation and distribution of the revenues of the
combined waterworks and sewerage system of said Village.
PREAMBLES
WHEREAS, the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the
"Municipality"), has provided by ordinance for the combination of its municipally -owned
waterworks system and its municipally -owned sanitary sewerage system and for the
operation thereof as a single utility (the "System"), in accordance with the provisions of
Division 139 of Article 11 of the Illinois Municipal Code, as supplemented and amended;
and
WHEREAS, the Municipality has heretofore issued the following described bonds
which are payable from the revenues of the System:
$400,000 original issue Waterworks and Sewerage Revenue Bonds,
Series 1978, dated April 1, 1978, of which $175,000 are currently
outstanding, of the denomination of $5,000 each, due serially on
May 1 of the years and in the amounts and bearing interest at the
rate or rates per annum, as follows:
YEAR AMOUNT ($) RATE ( %)
1993 25,000 6.00
1994 25,000 6.20
1995 30,000 6.30
1996 30,000 6.40
1997 30,000 6.40
1998 35,000 6.40
(the "Prior Bonds "), the Prior Bonds being subject to optional redemption on May t, 1993,
at a redemption price of par plus accrued interest to said redemption date, as provided in the
ordinance authorizing the issuance of the Prior Bonds; and
WHEREAS, the President and Board of Trustees of the Municipality (the "Corporate
Authorities ") have and do hereby determine it to be advisable and in the best interests of the
Municipality that all the Prior Bonds, other than Prior Bonds maturing on May 1, 1993,
which shall be paid when due from funds on hand and lawfully available to pay the same, be
refunded in order to effect a savings in debt service and restructure debt service payments;
and
WHEREAS, the total estimated costs of refunding the Prior Bonds are $160,000, and
the Municipality has insufficient funds to pay the same and, therefore, must borrow money
and issue bonds at this time in evidence thereof in the total amount of $160,000 for such
purposes; and
WHEREAS, pursuant to and in accordance with the provisions of Division 139 of
Article 11 and Division 4 of Article 8 of the Illinois Municipal Code, as supplemented and
amended, the Municipality is authorized to issue waterworks and sewerage revenue bonds in
the aggregate principal amount of $160,000 for the purpose of paying the costs of refunding
the Prior Bonds; and
WHEREAS, the Municipality is now authorized to issue bonds in the amount of
$160,00() for the purpose of refunding the Prior Bonds, said bonds to be payable solely
from the revenues of the System, all as provided by law; and
WHEREAS, it is hereby determined that it is in the best interests of the Municipality
that bonds be issued in the amount of $160,000 at this time, for the purposes of refunding
the Prior Bonds:
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ZO'd WdPO:Z EBB' 'ET Ndd 86STLSZBOL :01 X1871110 0Nd NIWdUH0:Wa1d
NOW, THEREFORE, Be It Ordained by the President and Board of Trustees of the
Village of Lemont, Cook, DuPage and Will Counties, Illinois, as follows:
Section 1. Definitions. The following words and terms used in this ordinance shall
have the following meanings unless the context or use clearly indicates another or different
meaning is intended:
"Act" means the Illinois Municipal Code, as supplemented and amended (65 ILCS 5/1-
1-1 et seq.) and in particular, Division 4 of Article 8 and Division 139 of Article 11 thereof,
and particularly as supplemented by the Local Government Debt Reform Act, as
supplemented and amended (30 ILCS 350/1 et seq.).
"Bond" or "Bonds" means one or more, as applicable, of the $160,000 Waterworks
and Sewerage Refunding Revenue Bonds, Series 1993, authorized to be issued by this
Ordinance.
"Bond Register" means the Books of the Municipality kept by the Bond Registrar to
evidence the registration and transfer of the Bonds.
"Bond Registrar" means NBD Bank Lemont, Lemont, Illinois, or a successor
designated as Bond Registrar hereunder.
"Code" means the Internal Revenue Code of 1986.
"Fiscal Year" means a twelve -month period beginning May 1 of the calendar year and
ending on the next succeeding April 30.
"Interest Requirement" means, for any Fiscal Year, the aggregate amount of interest
due and payable during such Fiscal Year.
"Maximum Annual Debt Service" means an amount of money equal to the highest
future Principal and Interest requirement of all Outstanding Bonds required to be deposited
into the Bond and Interest Account created by this Ordinance in any Fiscal Year, including
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and subsequent to the Fiscal Year in which the computation is made. Any Outstanding
Bonds required to be redeemed pursuant to mandatory redemption from said Bond and
Interest Account shall be treated as falling due on the date required to be redeemed (except
in the case of failure to make any such mandatory redemption) and not on the stated matu-
rity date of such Outstanding Bonds.
"Municipality" means the Village of Lemont, Cook, DuPage and Will Counties,
Illinois.
"Net Revenues" means Revenues minus Operation and Maintenance Costs.
"Operation and Maintenance Costs" means all costs of operating, maintaining and rou-
tine repair of the System, including wages, salaries, costs of materials and supplies, power,
fuel, insurance, purchase of water or sewage treatment services (including all payments by
the Municipality pursuant to long term contracts for such services); but excluding debt ser-
vice, depreciation, or any reserve requirements; and otherwise determined in accordance
with generally accepted accounting principles for municipal enterprise funds.
"Outstanding Bonds" means Bonds and Parity Bonds which are outstanding and un-
paid; provided, however, such term shall not include Bonds or Parity Bonds (i) which have
matured and for which moneys are on deposit with proper paying agents, or are otherwise
properly available, sufficient to pay all principal thereof and interest thereon, or (ii) the
provision for payment of which has been made by the Municipality by the deposit in an irre-
vocable trust or escrow of funds or direct, full faith and credit obligations of the United
States of America, the principal of and interest on which will be sufficient to pay at maturity
or as called for redemption all the principal of and interest on such Bonds or Parity Bonds.
"Parity Bonds" means bonds or any other obligation to be issued subsequent in time to
the Bonds and which will share ratably and equally in the earnings of the System with the
Bonds.
"Paying Agent" means NBD Bank Lemont, Lemont, Illinois, or its successors or
assigns hereunder.
"Principal Requirement" means, for any Fiscal Year, the aggregate principal amount
of Bonds due and payable during such Fiscal Year.
"Prior Bonds" means the outstanding bonds of the Municipality payable from the rev-
enues of the System as more particularly described in the preambles to this Ordinance.
"Revenues" means all income from whatever source derived from the System, includ-
ing (i) investment income; (ii) connection, permit and inspection fees and the like; (iii)
penalties and delinquency charges; (iv) capital development, reimbursement, or recovery
charges and the like; (v) annexation or pre- annexation charges insofar as designated by the
Corporate Authorities as paid for System connection or service; but excluding expressly (a)
non - recurring income from the sale of property of the System; (b) governmental or other
grants; (c) advances or grants made from the Municipality; and as otherwise determined in
accordance with generally accepted accounting principles for municipal enterprise funds.
"State" means the State of Illinois.
"System" refers to all property, real, personal or otherwise owned or to be owned by
the Municipality or under the control of the Municipality, and used for waterworks and sew-
erage purposes, including any and all further extensions, improvements and additions to the
System.
"Waterworks and Sewerage Fund" means the Waterworks and Sewerage Fund of the
Municipality created and established by this Ordinance.
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Section 2. Incorporation of Preambles. The Corporate Authorities hereby find
that all of the recitals contained in the preambles to this Ordinance are full. true and correct
and do incorporate them into this Ordinance by this reference.
Section 3. Determination To Issue Bonds. It is necessary and in the best interests
of the Municipality to refund the Prior Bonds and to undertake the Project, and that the
System continue to be operated as a single utility in accordance with the provisions of the
Act.
Section 4. Determination of Useful Life. The Corporate Authorities do hereby
determine the period of usefulness of the System to be forty (40) years from the date of the
Bonds.
Section 5. Bond Details. For the purpose of refunding the Prior Bonds, there shall
be issued and sold the Bonds in the principal amount of $160,000. The Bonds shall each be
designated "Waterworks and Sewerage Refunding Revenue Bond, Series 1993" and be dated
the date of issuance thereof; and shall also bear the date of authentication thereof. The
Bonds shall be in fully registered form, shall be in denominations of $5,000 each, and au-
thorized integral multiples thereof (but no single Bond shall represent principal maturing on
more than one date), shall be numbered 1 and upward, shall bear interest at the rate or rates
per annum, and shall mature serially on May 1 of each of the years and in the amounts as
follows (subject to the right of prior redemption hereinafter stated):
YEAR OF PRINCIPAL INTEREST
MATURITY AMOUNT ($) RATE ( %)
1994 30,000 4.00
1995 30,000 4.25
1996 30,000 4.50
1997 35,000 4.75
1998 35,000 5.00
The Bonds shall bear interest from their date until the principal amount of the Bonds is paid,
such interest (computed upon the basis of a 360 -day year of twelve 30 -day months), being
payable on May 1 and November 1 of each year, commencing on November 1, 1993.
Interest on each Bond shall be paid by check or draft of the Paying Agent, payable upon pre-
sentation in lawful money of the United States of America, to the person in whose name such
Bond is registered at the close of business on the 15th day of the month next preceding the
interest payment date. The principal of and premium (if any) on the Bonds shall be payable
upon presentation in lawful money of the United States of America at the principal corporate
trust office of the Paying Agent.
Section 6. Optional Redemption, The Bonds due on May 1, 1996, and
thereafter are subject to redemption and payment prior to their maturity, at the option of the
Municipality, in whole or in part, from any available funds, on May 1, 1995, or on any
interest payment date thereafter, and if in part, in an amount which is equal to at least
$5,000 or is an integral multiple thereof, in any order of maturities as determined by the
Municipality and within any maturity by lot, at a redemption price of par and accrued inter-
est to the date fixed for redemption.
The Bonds shall be redeemed only in the principal amount of $5,000 each and integral
multiples thereof. The Municipality shall, at least forty -five (45) days prior to the
redemption date (unless a shorter time period shall be satisfactory to the Bond Registrar),
notify the Bond Registrar of such redemption date and of the principal amount of Bonds to
be redeemed.
In the event of a partial redemption of Bonds of a given maturity, the particular
Bonds or portions thereof to be redeemed shall be selected by lot not more than 60 days
prior to the redemption date by the Bond Registrar. With respect to partial redemptions, the
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Bond Registrar shall select the Bonds or portions thereof to be redeemed by such method of
lottery as the Bond Registrar shall deem fair and appropriate; provided that such lottery
shall provide for the selection for redemption of Bonds or portions thereof so that any
$5,000 Bond or $5,000 portion of a Bond shall be as likely to be called for redemption as
any other such $5,000 Bond or $5,000 portion.
The Bond Registrar shall promptly notify the Municipality in writing of the Bonds or
portions of Bonds selected for redemption and, in the case of any Bond selected for partial
redemption, the principal amount thereof to be redeemed.
Unless waived by the owner of Bonds to be redeemed, notice of any such redemption
shall be given by the Bond Registrar on behalf of the Municipality by mailing the redemp-
tion notice by registered or certified mail not less than thirty days and not more than sixty
days prior to the date fixed for redemption to each registered owner of the Bond or Bonds
to be redeemed at the address shown on the Bond Register or at such other address as is
furnished in writing by such registered owners to the Bond Registrar.
All notices of redemption shall include at least the information as follows:
(1) the redemption date;
(2) the redemption price:
(3) if less than all of the Bonds of a single maturity are to be redeemed, the
identification (and, in the case of partial redemption of any Bonds, the respective
principal amounts) of the Bonds to be redeemed;
(4) a statement that on the redemption date the redemption price will become
due and payable upon each such Bond or portion thereof called for redemption and
that interest thereon shall cease to accrue from and after said date; and
(5) the place where such Bonds are to be surrendered for payment of the re-
demption price, which place of payment shall be the principal corporate trust office of
the Bond Registrar.
Prior to any redemption date, the Municipality shall deposit with the Bond Registrar
an amount of money sufficient to pay the redemption price of all the Bonds or portions of
Bonds which are to be redeemed on that date.
Notice of redemption having been given as aforesaid, the Bonds or portions of Bonds
so to be redeemed shall, on the redemption date, become due and payable at the redemption
price therein specified, and from and after such date (unless the Municipality shall default in
the payment of the redemption price) such Bonds or portions of Bonds shall cease to bear
interest. Neither the failure to mail such redemption notice, nor any defect in any notice so
mailed, to any particular Registered Owner, shall affect the sufficiency of such notice with
respect to other Bonds. Notice having been properly given, failure of a Registered Owner
to receive such notice shall not be deemed to invalidate, limit or delay the effect of the notice
or redemption action described in the notice. Such notice may be waived in writing by a
Registered Owner entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by registered owners shall
be filed with the Bond Registrar, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
Upon surrender of such Bonds for redemption in accordance with said notice, such
Bonds shall be paid by the Bond Registrar at the redemption price. Interest due on or prior
to the redemption date shall be payable as herein provided for payment of interest. Upon
surrender for any partial redemption of any Bond, there shall be prepared for the registered
owner a new Bond or Bonds of the same maturity and rate of interest in the amount of the
unpaid principal.
If any Bond or portion of Bond called for redemption shall not be so paid upon sur-
render thereof for redemption, the principal, and premium, if any, shall, until paid, bear
interest from the redemption date at the rate borne by the Bond or portion of Bond so called
for redemption. All Bonds which have been redeemed shall be cancelled and destroyed by
the Bond Registrar and shall not be reissued.
Parity Bonds hereinafter issued pursuant to the terms hereof may be redeemable at
such times and upon such terms as may be determined at the time of authorization thereof.
Section 7. Amendment. The rights and obligations of the Municipality and of the
owners of Outstanding Bonds may from time to time be modified or amended by a supple-
mental ordinance adopted by the Corporate Authorities with the written consent of the
owners of not less than two - thirds (2 /3rds) of the principal amount of all Outstanding Bonds
(excluding any of said bonds owned by or under the control of the Municipality); provided,
however, that no such modification or amendment shall extend or change the maturity of or
date of redemption prior to maturity, or reduce the interest rate on, or permit the creation
of a preference or priority of any Outstanding Bond or Outstanding Bonds over any other
Outstanding Bond or Outstanding Bonds, or otherwise alter or impair the obligation of the
Municipality to pay the principal of and interest on any of the Outstanding Bonds at the time,
place, rate, and in the currency provided therein, or alter or impair the obligations of the
Municipality with respect to registration, transfer, exchange or notice of redemption of
Bonds, without the express consent of the owners of all the Outstanding Bonds affected; nor
shall any such modification or amendment reduce the percentage of the owners of
Outstanding Bonds required for the written consent of such modification or amendment
without the consent of the owners of all of the Outstanding Bonds.
Section 8. Execution: Authentication. The Bonds shall be executed on behalf of
the Municipality with the manual or duly authorized facsimile signature of the President and
attested with the manual or duly authorized facsimile signature of the Village Clerk, as they
may determine, and shall have impressed or imprinted thereon the corporate seal or facsim-
ile thereof of the Municipality. In case any officer whose signature shall appear on any
Bond shall cease to be such officer before the delivery of such Bond, such signature shall
nevertheless be valid and sufficient for all purposes, the same as if such officer had remained
in office until delivery.
All Bonds shall have thereon a certificate of authentication substantially in the form
hereinafter set forth duly executed by the Bond Registrar as authenticating agent of the
Municipality and showing the date of authentication. No Bond shall be valid or obligatory
for any purpose or be entitled to any security or benefit under this Ordinance unless and
until such certificate of authentication shall have been duly executed by the Bond Registrar
by manual signature, and such certificate of authentication upon any such Bond shall be
conclusive evidence that such Bond has been authenticated and delivered under this
Ordinance. The certificate of authentication on any Bond shall be deemed to have been exe-
cuted by it if signed by an authorized officer of the Bond Registrar, but it shall not be neces-
sary that the same officer sign the certificate of authentication on all of the Bonds issued
hereunder.
Section 9. Registration of Bonds; Persons Treated as Owners. The Municipality
shall cause books (the "Bond Register ") for the registration and for the transfer of the Bonds
as provided in this Ordinance to be kept at the principal corporate trust office of the Bond
Registrar, which is hereby constituted and appointed the registrar of the Municipality. The
Municipality is authorized to prepare. and the Bond Registrar or such other agent as the
Municipality may designate shall keep custody of, multiple Bond blanks executed by the
Municipality for use in the transfer and exchange of Bonds.
Upon surrender for transfer of any Bond at the principal corporate trust office of the
Bond Registrar. duly endorsed by, or accompanied by a written instrument or instruments
of transfer in form satisfactory to the Bond Registrar and duly executed by, the registered
owner or his attorney duly authorized in writing, the Municipality shall execute and the
Bond Registrar shall authenticate, date and deliver in the name of the transferee or transfer-
ees a new fully registered Bond or Bonds of the same maturity and rate of interest of autho-
rized denominations, for a like aggregate principal amount. Any fully registered Bond or
Bonds may be exchanged at said office of the Bond Registrar for a like aggregate principal
amount of Bond or Bonds of the same maturity and rate of interest of other authorized
denominations. The execution by the Municipality of any fully registered Bond shall consti-
tute full and due authorization of such Bond; and the Bond Registrar shall thereby be autho-
rized to authenticate, date and deliver such Bond; provided, however, the principal amount
of Outstanding Bonds of each maturity authenticated by the Bond Registrar shall not at any
one time exceed the authorized principal amount of Bonds for such maturity less the amount
of such Bonds which have been paid.
The Bond Registrar shall not be required to transfer or exchange any Bond during the
period from the fifteenth day of the month next preceding an interest payment date to such
interest payment date, or to transfer or exchange any Bond after notice calling such Bond
for redemption has been mailed, or to transfer or exchange any Bond during a period of
fifteen days next preceding mailing of a notice of redemption of any Bonds.
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The person in whose name any Bond shall be registered shall be deemed and regarded
as the absolute owner thereof for all purposes, and payment of the principal of or interest on
any Bond shall be made only to or upon the order of the registered owner thereof or his
legal representative. All such payments shall be valid and effectual to satisfy and discharge
the liability upon such Bond to the extent of the sum or sums so paid.
No service charge shall be made for any transfer or exchange of Bonds, but the
Municipality or the Bond Registrar may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any transfer or
exchange of Bonds except in the case of the issuance of a Bond or Bonds for the unredeemed
portion of a Bond surrendered for redemption.
Section 10. Form of Bond. The Bonds shall be prepared in compliance with the
National Standard Specifications for Fully Registered Municipal Securities prepared by the
American National Standards Institute and shall be in substantially the form hereinafter set
forth; provided, however, that if the text of the Bond is to be printed in its entirety on the
front side of the Bond, then paragraph [2] and the legend, "See Reverse Side for Additional
Provisions ", shall be omitted and paragraphs [6] through [15] shall be inserted immediately
after paragraph [1].
(FORM OF BOND - FRONT SIDE)
REGISTERED REGISTERED
NO. $
UNITED STATES OF AMERICA
STATE OF ILLINOIS
COUNTIES OF COOK, DUPAGE AND WILL
VILLAGE OF LEMONT
WATERWORKS AND SEWERAGE REFUNDING REVENUE BOND
SERIES 1993
See Reverse Side for
Additional Provisions
Interest
Rate:
Maturity Dated
Date: Date: April _, 1993 CUSIP
Registered Owner:
Principal Amount:
[1] KNOW ALL PERSONS BY THESE PRESENTS, that the Village of Lemont, Cook,
DuPage and Will Counties, Illinois, a municipality and political subdivision of the State of
Illinois (the "Municipality"), hereby acknowledges itself to owe and for value received
promises to pay to the Registered Owner identified above, or registered assigns as
hereinafter provided, on the Maturity Date identified above, the Principal Amount identified
above and to pay interest (computed on the basis of a 360 -day year of twelve 30 -day months)
on such principal amount from the date of this Bond or from the most recent interest
payment date to which interest has been paid at the Interest Rate per annum identified above,
such interest to be payable on May 1 and November 1 of each year, commencing November
1, 1993, until said principal amount is paid, except as the provisions hereinafter set forth
with respect to redemption prior to maturity may be and become applicable hereto. Both
principal of and premium (if any) on this Bond are payable in lawful money of the United
States of America upon presentation at the principal corporate trust office of NBD Bank
Lemont, Lemont, Chicago, Illinois, paying agent (the "Paying Agent"). Payment of interest
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shall be made to the Registered Owner hereof as appearing on the registration books of the
Municipality maintained by NBD Bank Lemont, Lemont, Illinois, as bond registrar (the
`Bond Registrar"), at the close of business on the 15th day of the month next preceding the
interest payment date and shall be paid by check or draft of the Paying Agent, payable upon
presentation in lawful money of the United States of America, mailed to the address of such
Registered Owner as it appears on such registration books or at such other address furnished
in writing by such Registered Owner to the Bond Registrar.
[2] Reference is hereby made to the further provisions of this Bond set forth on the
reverse hereof, and such further provisions shall for all purposes have the same effect as if
set forth at this place.
[3]
It is hereby certified and recited that all acts, conditions and things required to
be done precedent to and in the issuance of this Bond have been done and have happened and
have been performed in regular and due form of law and that provision has been made for
depositing into the Waterworks and Sewerage Fund the entire Revenues received from the
operation of the System to be applied in the manner as hereinabove set forth; and the
Municipality hereby covenants and agrees that it will fix and maintain rates for the use and
service of the System and collect and account for the Revenues derived therefrom sufficient
at all times to pay Operation and Maintenance Costs, promptly to pay principal of and
interest on all bonds issued by the Municipality which are payable solely from the Revenues
of the System, to provide an adequate depreciation fund, and to comply with all the
covenants of and to maintain the accounts created by the Ordinance.
[4] This Bond shall not be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been signed by the Bond Registrar.
[5] IN WITNESS WHEREOF, the Village of Lemont, Cook, DuPage and Will
Counties, Illinois, by its President and Board of Trustees has caused this Bond to be executed
with the manual or duly authorized facsimile signature of its President and attested by the
manual or duly authorized facsimile signature of its Village Clerk and its corporate seal or a
facsimile thereof to be impressed or reproduced hereon, all as appearing hereon and as of
the Dated Date identified above.
Atte
./di I .'r
Village Clerk, Village of Lemont,
Cook, DuPage and Will Counties, Illinois
(SEAL)
Date of Authentication:
P /sident, ' illage o Lemont,
Cook, DuPage and Will Counties, Illinois
CERI1hHCATE Bond Registrar
OF and
AUTHENTICATION Paying Agent: NBD Bank Lemont,
Lemont, Illinois
This Bond is one of the Bonds
described in the within mentioned
Ordinance and is one of the Water-
works and Sewerage Refunding
Revenue Bonds, Series 1993, of the
Village of Lemont, Cook, DuPage
and Will Counties, Illinois.
NBD Bank Lemont,
as Bond Registrar
By
Authorized Officer
[FORM OF BOND - REVERSE SIDE]
VILLAGE OF LEMONT, COOK, DUPAGE AND WILL COUNTIES, ILLINOIS
WATERWORKS AND SEWERAGE REFUNDING REVENUE BOND, SERIES 1993
[6] This bond and the bonds of the series of which it forms a part ( "Bond" and
"Bonds" respectively) are of an authorized issue of $160,000, of like dated date and tenor
except as to maturity, rate of interest and privilege of redemption. The Bonds are payable
solely from the Revenues derived from the operation of the waterworks and sewerage
system of the Municipality (the "System ") after payment of Operation and Maintenance Costs
(the "Net Revenues"), and not otherwise, and are issued under authority of the provisions of
Division 139 of Article 11 and Division 4 of Article 8 of the Illinois Municipal Code, as
supplemented and amended, and particularly as supplemented by the Local Government Debt
Reform Act of the State of Illinois, as amended (as supplemented, the "Act"), for the
purposes of paying the costs of refunding the outstanding and unpaid bonds of the
Municipality payable from the revenues of the System (the "Prior Bonds "), except for Prior
Bonds due on May 1, 1993, which shall be paid when due from funds on hand and lawfully
available to pay the same. The Bonds are issued pursuant to an ordinance passed by the
President and Board of Trustees (the "Corporate Authorities ") of the Municipality on the
12th day of April, 1993 (the "Ordinance"), to which reference is hereby expressly made for
further definitions and terms and to all the provisions of which the holder by the acceptance
of this Bond assents. This Bond does not constitute an indebtedness of the Municipality
within the meaning of any constitutional or statutory provision or limitation. This Bond is a
limited obligation of the Municipality payable solely from the Net Revenues as provided
herein.
[7] Under the Act and the Ordinance, the Revenues from the operation of the
System shall be deposited into the Waterworks and Sewerage Fund, which shall be used only
and is hereby pledged for paying Operation and Maintenance Costs, paying the principal of
and interest on all bonds of the Municipality that are payable by their terms only from the
Revenues of the System, providing an adequate depreciation fund, and in making all pay-
ments required to maintain the accounts established under the terms of the Ordinance.
Parity Bonds may be issued pursuant to the terms of the Ordinance.
[8] Outstanding Bonds issued and authenticated pursuant to the Ordinance are co-
equal as to the lien on the Revenues of the System for their payment and share ratably, with-
out any preference, priority, or distinction, the one over the other, as to the source or
method of payment and security of the Outstanding Bonds, but are subject and subordinate to
the rights of the holders of the Prior Bonds to a prior claim on the Revenues of the System
pending the final payment due on May 1, 1993, of the principal of, interest on and
redemption price of the Prior Bonds. Cash has previously been irrevocably deposited with
the paying agent for the Prior Bonds in an amount adequate for that purpose.
[9] The rights and obligations of the Municipality and of the owners of the Bonds
may from time to time be modified or amended by a supplemental ordinance adopted by the
Corporate Authorities with the written consent of the owners of not less than two - thirds
(2 /3rds) of the principal amount of all Outstanding Bonds (excluding any of said bonds
owned by or under the control of the Municipality); provided, however, that no such modi-
fication or amendment shall extend or change the maturity of or date of redemption prior to
maturity, or reduce the interest rate or premium on, or permit the creation of a preference
or priority of any Outstanding Bond or Outstanding Bonds over any other Outstanding Bond
or Outstanding Bonds, or otherwise alter or impair the obligation of the Municipality to pay
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the principal of or interest on any of the Outstanding Bonds at the time, place, rate and in
the currency provided therein or alter or impair the obligations of the Municipality with
respect to registration, transfer, exchange or notice of redemption of Bonds, without the
express consent of the owners of all the Outstanding Bonds affected; nor shall any such
modification or amendment reduce the percentage of the owners of Outstanding Bonds
required for the written consent to such modification or amendment without the consent of
the owners of all of the Outstanding Bonds.
[10] The Bonds due on May 1, 1996, and thereafter are subject to optional
redemption at the option of the Municipality in whole or in part, and if in part, in any order
of maturity as determined by the Municipality and within any maturity by lot, on May 1,
1995, or any interest payment date thereafter, at a price of par and accrued interest to the
date fixed for redemption.
[11] Unless waived by the Registered Owner of Bonds to be redeemed, notice of any
such redemption shall be sent by registered or certified mail not less than thirty (30) days
nor more than sixty (60) days prior to the date fixed for redemption to the Registered
Owner of each Bond to be redeemed at the address shown on the registration books of the
Municipality maintained by the Bond Registrar or at such other address as is furnished in
writing by such Registered Owner to the Bond Registrar. Neither the failure to mail such
redemption notice, nor any defect in any notice so mailed, to any particular Registered
Owner, shall affect the sufficiency of such notice with respect to other Bonds. Notice having
been properly given, failure of a Registered Owner to receive such notice shall not be
deemed to invalidate, limit or delay the effect of the notice or redemption action described
in the notice. Such notice may be waived in writing by a Registered Owner entitled to
receive such notice, either before or after the event, and such waiver shall be the equivalent
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of such notice. Waivers of notice by registered owners shall be filed with the Bond
Registrar, but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver. When so called for redemption, this Bond will cease to
bear interest on the specified redemption date, provided funds for redemption are on deposit
at the place of payment at that time.
[12] This Bond is transferable by the Registered Owner hereof in person or by his
attorney duly authorized in writing at the principal corporate trust office of the Bond
Registrar in Lemont, Illinois, only in the manner, subject to the limitations and upon pay-
ment of the charges provided in the Ordinance, and upon surrender and cancellation of this
Bond. Upon such transfer a new Bond or Bonds of authorized denominations of the same
maturity and rate of interest and for the same aggregate principal amount will be issued to
the transferee in exchange therefor.
[13] The Bonds are issued in fully registered form in the denomination of $5,000
each or authorized integral multiples thereof. This Bond may be exchanged at the principal
corporate trust office of the Bond Registrar for a like aggregate principal amount of Bonds
of the same maturity and rate of interest of other authorized denominations upon the terms
set forth in the Ordinance.
[14] The Municipality, the Paying Agent and the Bond Registrar may deem and treat
the Registered Owner hereof as the absolute owner hereof for the purpose of receiving
payment of or on account of principal hereof, premium, if any, hereon and interest due
hereon and for all other purposes, and neither the Municipality, the Paying Agent nor the
Bond Registrar shall be affected by any notice to the contrary.
[15] The Municipality has designated this Bond as a "qualified tax- exempt obliga-
tion" pursuant to Section 265(b)(3) of the Internal Revenue Code of 1986.
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(ASSIGNMENT)
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
(Name and Address of Assignee)
the within Bond and does hereby irrevocably constitute and appoint
as attorney to transfer the said Bond on the books kept for registration thereof with full
power of substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: The signature to this assignment must correspond with the name of the registered
owner as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatever.
Section 11. Bonds Limited Obligations. The Bonds shall be payable solely from the
Net Revenues as derived from the operation of the System, and shall not constitute an in-
debtedness of the Municipality within the meaning of any constitutional or statutory limita-
tion.
Section 12. Creation of Waterworks and Sewerage Fund and Accounts Thereof.
Upon the issuance of any of the Bonds, the System shall be operated on a Fiscal Year basis.
All of the Revenues shall be set aside as collected and be deposited into a separate fund and
in an account in a bank to be designated by the Corporate Authorities, which fund is hereby
created and is designated as the "Waterworks and Sewerage Fund" (the "Waterworks and
Sewerage Fund ") of the Municipality, which shall constitute a trust fund for the sole purpose
of carrying out the covenants, terms, and conditions of this Ordinance, and shall be used
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only in paying Operation and Maintenance Costs, providing an adequate depreciation fund,
paying the principal of and interest on all revenue bonds of the Municipality which by their
terms are payable solely from the Revenues derived from the System, and providing for the
establishment of and expenditure from the respective accounts as hereinafter described.
Section 13. Flow of Funds. There shall be and there are hereby created separate
accounts in the Waterworks and Sewerage Fund to be known as the "Operation and
Maintenance Account," the "Bond and Interest Account," the "Bond Reserve Account," the
"Depreciation Account," and the "Surplus Account," to which there shall be credited on or
before the first day of each month by the financial officer of the Municipality, without any
further official action or direction, in the order in which said accounts are hereinafter
mentioned, all moneys held in the Waterworks and Sewerage Fund, in accordance with the
following provisions:
(a) OPERATION AND MAINTENANCE ACCOUNT:
There shall be credited to the Operation and Maintenance Account an amount
sufficient, when added to the amount then on deposit in said Account, to estab-
lish a balance to an amount not less than the amount necessary to pay Operation
and Maintenance Costs for the then current month.
Amounts in said Account shall be used to pay Operation and Maintenance Costs.
(b) BOND AND INTEREST ACCOUNT:
After making any payments required for the benefit of the Prior Bonds, there
next shall be credited to the Bond and Interest Account and held, in cash and in-
vestments, a fractional amount of the interest becoming due on the next succeed-
ing interest payment date on all Outstanding Bonds and also a fractional amount
of the principal becoming due on the next succeeding principal maturity date of
all of the Outstanding Bonds until there shall have been accumulated and held,
in cash and investments, in the Bond and Interest Account on or before the
month preceding such maturity date of interest or maturity date of principal, an
amount sufficient to pay such principal or interest, or both.
(c)
In computing the fractional amount to be set aside each month in the Bond and
Interest Account, the fraction shall be so computed that a sufficient amount will
be set aside in said Account and will be available for the prompt payment of
such principal of and interest on all Outstanding Bonds and shall be not less than
one -fifth of the interest becoming due on the next succeeding interest payment
date and not less than one -tenth of the principal becoming due on the next suc-
ceeding principal payment date on all Outstanding Bonds until there is sufficient
money in said Account to pay such principal or interest, or both.
Credits to the Bond and Interest Account may be suspended in any Fiscal Year
at such time as there shall be a sufficient sum, held in cash and investtnents, in
said Account to meet principal and interest requirements in said Account for the
balance of such Fiscal Year, but such credits shall again be resumed at the be-
ginning of the next Fiscal Year.
All moneys in said Account shall be used only for the purpose of paying interest
on and principal of Outstanding Bonds.
BOND RESERVE ACCOUNT:
There next shall be credited to the Bond Reserve Account and held, in cash and
investments, the sum of $1,500 each month until the credit balance of said
Account aggregates an amount equal to Maximum Annual Debt Service. The
funds of such Bond Reserve Account shall be used to pay principal of or interest
becoming due or subject to mandatory redemption on any Bonds and Parity
Bonds then outstanding whenever funds are not available in the Bond and
Interest Account therefor, and for that purpose there shall be transferred
promptly from this Bond Reserve Account to the Bond and Interest Account not
less than five (5) days prior to the maturity or mandatory redemption of
principal of and interest on any such Bonds a sum which, together with the
funds then on hand in the Bond and Interest Account, shall be sufficient to meet
such principal or interest becoming due or subject to mandatory redemption. In
the event that any moneys shall be withdrawn from the Bond Reserve Account
for payment into the Bond and Interest Account, the Municipality covenants to
replenish the Bond Reserve Account at the rate of one- twelfth the amount so
withdrawn per month or in the atnount of $1,500 per month, whichever is
greater, until such withdrawn amount is repaid in full; provided, however, that
moneys in the Bond Reserve Account may be used to pay principal of and
interest on Bonds due on May 1, 1998, so long as no Outstanding Bonds shall
remain outstanding at the time of such payment, without replenishing the Bond
Reserve Account,
Investments on deposit in the Bond Reserve Account shall be valued at the
amortized cost thereof, exclusive of accrued interest thereon, No moneys shall
be withdrawn from the Bond Reserve Account unless the amount on deposit
therein is in excess of Maximum Annual Debt Service,
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Whenever there is on deposit in the Bond Reserve Account an amount in excess
of Maximum Annual Debt Service, the amount of such excess may be reduced at
the option of the Municipality. If such excess is evidenced by moneys and in-
vestments, an amount equal to such excess shall be withdrawn from the Bond
Reserve Account and transferred as provided in subsection (g) of this Section
13.
(d) DEPRECIATION ACCOUNT:
Money in the Waterworks and Sewerage Fund shall next be allocated to the
separate and special account to maintain a renewal, replacement and
depreciation reserve for the System known as the "Depreciation Account," On
or prior to the first day of each month there shall be credited to the
Depreciation Account the sum of $500, until the sum of $6,000 has been
accumulated, at which time credits to said Account tnay be suspended.
However, such credits shall be resumed at any time that the balance in said
Account is less than $6,000 and shall continue until the sum of $6,000 has been
accumulated. Money in the Depreciation Account shall be used solely for the
purpose of paying principal of and interest on Bonds when there shall be
insufficient money in the Bond and Interest Account or the Bond Reserve
Account; and to the extent not required for the foregoing, to pay the cost of
extraordinary maintenance expenses or repairs, renewals and replacements not
included in the annual budget for current Operation and Maintenance Expenses.
The amount required to be maintained in the Depreciation Account is hereby
determined to be an adequate and reasonable depreciation reserve.
Whenever an amount is withdrawn from such Account for the purpose of pay-
ing principal of or interest on Bonds, there shall be added to the arnount to be
next and thereafter credited to said Depreciation Account an amount equal to
1 /100 of such amount withdrawn, until such amount withdrawn shall have been
fully restored to said Depreciation Account.
(e) SURPLUS ACCOUNT:
All moneys remaining in the Waterworks and Sewerage Fund, after crediting
the required amounts to the respective accounts hereinabove provided for, and
after making up any deficiency in the accounts described in subsections (a) to
(d), inclusive, shall be credited each month to the Surplus Account. Funds in
the Surplus Account shall first be used to make up any subsequent deficiencies
in any of the accounts hereinabove named and then, at the discretion of the
Corporate Authorities, shall be used for one or more of the following purposes
without any priority among them:
(1) For the purpose of constructing, installing or acquiring repairs, replace-
ments, or improvements to the System; or
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(2) For the purpose of calling and redeeming Outstanding Bonds which are
callable at the time; or
(3) For the purpose of purchasing Outstanding Bonds at the time at a price of
not to exceed par and accrued interest to the date of purchase; or
(4) For the purpose of paying principal of and interest on any subordinate
bonds or obligations issued for the purpose of acquiring, installing or
constructing repairs, replacements, or improvements to the System; or
(5) For any other lawful Municipal purpose.
(f) Money to the credit of the Waterworks and Sewerage Fund prior to the monthly
accounting and to the credit of the Operation and Maintenance Account may be
invested pursuant to any authorization granted to municipal corporations by
State law or court decision.
Moneys to the credit of the Bond and Interest Account, Bond Reserve Account,
Depreciation Account and Surplus Account may be invested from time to time
by the Treasurer of the Municipality in (i) interest bearing bonds, notes, or
other direct full faith and credit obligations of the United States of America, (ii)
obligations unconditionally guaranteed as to both principal and interest by the
United States of America, or (iii) certificates of deposit or time deposits of any
bank, as defined by the Illinois Banking Act, provided such bank is insured by
the Federal Deposit Insurance Corporation or a successor corporation to the
Federal Deposit Insurance Corporation, and provided further that the principal
of such deposits in excess of the insured amount is secured by a pledge of
obligations as described in clauses (f)(i) and (f)(ii) above in the full principal
atnount of such excess. Such investments may be sold from time to titne by the
Treasurer of the Municipality as funds may be needed for the purpose for
which said respective accounts have been created. To the extent moneys in said
Accounts as described in this paragraph are held uninvested and on deposit in
demand accounts, such amounts shall be added to the amount invested pursuant
to clause (iii) above and the sum so derived subject to the limitations as set forth
therein.
Investments in the Accounts shall mature or be subject to redetnption at the
option of the holder thereof prior to the time when needed, and, in any event,
within the times as follows:
ACCOUNT TIME
Operation and Maintenance 45 days
Bond and Interest 1 year
Bond Reserve 3 years
Depreciation 5 years
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(g)
Surplus 5 years
All interest on any funds so invested shall be credited to the Waterworks and
Sewerage Fund and is hereby deemed and allocated as expended with the next
expenditure(s) of money from the Waterworks and Sewerage Fund.
Moneys in any of said accounts shall be invested by the Treasurer, if necessary,
in investments restricted as to yield, which investments may be in United States
Treasury Obligations - State and Local Government Series, if available, and to
such end the Treasurer shall refer to any investment restrictions covenanted by
the Municipality or any officer thereof as part of the transcript of proceedings
for the issuance of the Bonds, and to appropriate opinions of counsel,
Any amounts to the credit of the Accounts in excess of the then current re-
quirement therefor may be transferred by the Corporate Authorities to such
other Account or Accounts of the Waterworks and Sewerage Fund as they may
in their sole discretion designate.
(h) Upon the issuance of the Bonds, all the moneys remaining in the special
accounts established and maintained by the ordinance authorizing the Prior
Bonds (the "Prior Accounts ") shall be transferred as follows:
(i) From the Prior Operation and Maintenance Account, all amounts on
deposit to the Operation and Maintenance Account hereunder.
(ii) From the Prior Bond and Interest Account, the amount necessary to the
paying agent for the Prior Bonds for the purpose of paying the Prior
Bonds due on May 1, 1993;
(iii) From the Prior Bond and Interest Reserve Account, $35,000 to the
Depreciation Account hereunder;
(iv) From the Prior Depreciation, Replacement and Contingencies Account,
$50,000 to the Depreciation Account hereunder; and
(v) The balance to the Surplus Account hereunder,
Section 14, General Covenants, The Municipality covenants and agrees with the
holders of the Outstanding Bonds, so long as there are any Outstanding Bonds (as defined
herein), as follows:
(a) The Municipality will maintain the System in good repair and working order,
will operate the same efficiently and faithfully, will promptly proceed with the
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Project, and will punctually perform all duties with respect thereto required by
the Constitution and laws of the State of Illinois.
(b) The Municipality will establish and maintain at all times reasonable fees,
charges, and rates for the use and service of the System and will provide for the
collection thereof and the segregation and application of the Revenues in the
manner provided by this ordinance, sufficient at all times to pay Operation and
Maintenance Costs, to provide an adequate depreciation fund, to pay the princi-
pal of and interest on all revenue bonds of the Municipality which by their
terms are payable solely from the Revenues, and to provide for the creation and
maintenance of the respective accounts as provided in Section 13 of this
Ordinance.
There shall be charged against all users of the System, including the
Municipality, such rates and amounts for water and sewer services as shall be
adequate to meet the requirements of this subsection, Charges for services
rendered the Municipality shall be made against the Municipality, and payment
for the same shall be made monthly from the corporate funds into the
Waterworks arid Sewerage Fund as revenues derived from the operation of the
System; provided, however, that the Municipality need not charge itself for such
services if in the previous Fiscal Year Revenues not including any payments
made by the Municipality shall have met the requirements of this Ordinance.
Whenever money in the Bond Reserve Account is used to pay principal of or
interest on Outstanding Bonds, the Municipality covenants promptly to have
prepared a rate study for the System by an independent consultant employed for
that purpose, and further, to send a copy of such study, when completed, to the
original purchaser of the Bonds along with a letter indicating what action the
Municipality has taken responsive to such study; provided, however, that this
paragraph shall not apply to money in the Bond Reserve Account used to pay
principal of or interest on the Bonds due on May 1, 1998.
(c) The Municipality from time to time will make all needful and proper repairs,
replacements, additions, and betterments to the System so that it may at all times
be operated properly and advantageously; and when any necessary equipment or
facility shall have been worn out, destroyed, or otherwise is insufficient for
proper use, it shall be promptly replaced so that the value and efficiency of the
System shall be at all times fully maintained.
(d) The Municipality will establish such rules and regulations for the control and
operation of the Systetn necessary for the safe, lawful, efficient and economical
operation thereof,
(e) The Municipality will make and keep proper books and accounts (separate and
apart from all other records and accounts of said Municipality), in which com-
plete entries shall be made of all transactions relating to the System, and hereby
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covenants that within ninety (90) days following the close of each Fiscal Year, it
will cause the books and accounts of the System to be audited by independent
certified public accountants. Said audit will he available for inspection by the
holders of any of the Bonds. Each such audit, in addition to whatever matters
may be thought proper by the accountants to be included therein, shall, without
limiting the generality of the foregoing, include the following:
(1) A statement in detail of incotnc and expenditures of the System for such
Fiscal Year.
(ii) A balance sheet as of the end of such Fiscal Year, including a statement of
the amount held in each of the accounts of the Waterworks and Sewerage
Fund.
(iii) A list of all System insurance policies in force at the end of the Fiscal
Year, setting out as to each policy the amount of the policy, the risks
covered, the name of the insurer, and the expiration date of the policy.
(iv) The number of sewer customers served by the System at the end of the
year and the quantity of sewage treated, the number of metered water
customers and the number of unmetered water customers at the end of the
year, the quantity of water pumped and the quantity of water billed.
(v) Changes in the cost of purchased water or sewer services during such
Fiscal Year,
(vi) A summary of rates in effect at the end of such Fiscal Year for services
of the System and any changes in such rates effective during such Fiscal
Year.
(vii) The amount and details of all Outstanding Bonds.
(viii) The accountant's comment regarding the manner in which the
Municipality has carried out the requirements of this Ordinance, and the
accountant's recommendations for any changes or improvements in the
operation of the System.
All expenses of the audit required by this section shall be regarded and paid as
Operation and Maintenance Costs.
It is further covenanted and agreed that a copy of each such audit shall be fur-
nished upon completion to the original purchaser of the Bonds, and a summary
thereof shall be furnished to any bondholder upon request.
(f) The Municipality will keep the books and accounts for the System in accordance
with generally accepted fund reporting practices for municipal enterprise funds;
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(g)
provided, however, that the monthly credits to the Bond and Interest Account,
the Bond Reserve Account and the Depreciation Account shall be in cash and
said funds shall be held separate and apart in cash and investments. For the
purpose of determining whether sufficient cash and investments are on deposit
in such accounts under the terms and requirements of this Ordinance, invest-
ments shall be valued at amortized cost.
The Municipality will not sell, lease, Ioan, mortgage or in any manner dispose
of or encumber the Systetn (subject to the right of the Municipality to issue
Parity Bonds as provided in this Ordinance, to issue bonds subordinate to
Outstanding Bonds, and to dispose of real or personal property which is no
longer useful or necessary to the operation of the System), and the Municipality
will take no action in relation to the System which would unfavorably affect the
Outstanding Bonds or the prompt payment of the principal thereof and interest
thereon. Any amounts received from the sale of property of the System shall be
deposited to the credit of the Depreciation Account,
(h) Any holder of a Bond may proceed by civil action to compel performance of all
duties required by law and this Ordinance, including the making and collecting
of sufficient charges and rates for the service supplied by the System and the
application of the income and revenue therefrom.
(i)
The Municipality will carry insurance on the System of the kinds and in the
amounts which are usually carried by private parties operating similar prop-
erties, covering such risks as shall be recommended by a competent consulting
engineer or insurance consultant employed by the Municipality for the purpose
of making such recommendations. All moneys received for loss under such in-
surance policies shall be deposited to the credit of the Depreciation Account and
used in making good the loss or damage in respect of which they were paid,
either by repairing the property damaged or making replacement of the
property destroyed, and provision for tnaking good such loss or damage shall
be commenced within ninety (90) days frotn the date of the loss, The payment
of premiums for all insurance policies required under the provisions of this
covenant shall be considered an Operation and Maintenance Cost. The
proceeds, if any, derived from any and all policies for workers' compensation
or public liability shall be paid into the Operation and Maintenance Account and
used in paying the claims on account of which they were received,
(j) Except as hereinabove expressly provided for services to the Municipality, the
Municipality covenants not to provide any free service of the System, and, to
the extent permitted by law, the Municipality will not grant a franchise for the
operation of any competing waterworks system, sewerage system, or combined
waterworks and sewerage system within the Municipality.
(k) The Municipality will adopt a budget for the Waterworks and Sewerage Fund
prior to the beginning of each Fiscal Year, subject to applicable State law, pro -
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viding for payment of all sums to be due in the Fiscal Year so as to comply with
the terns of this Ordinance and of long -term water supply agreements. The
budget may include in its estimate of income, the use of available surplus
moneys or other funds of the Municipality appropriated for the purpose, If
during the Fiscal Year there are extraordinary unbudgeted receipts or payments
of unusual cost, the Municipality will adopt an amended budget for the
remainder of the Fiscal Year, providing for receipts or payments pursuant to
this Ordinance,
Section 15. Issuance of Parity .Bonds. As long as there are any Outstanding Bonds,
no obligations or bonds of any kind shall be issued which are payable from the Revenues
except upon compliance with one of the options (a) through (d) set out below:
(a) Parity Bonds may be issued for the purpose of paying the cost of repairs, re-
placements, renewals, improvements and extensions to the System or for re-
funding Outstanding Bonds upon compliance with the following conditions:
(i)
The amounts required to be credited monthly to the respective accounts
described in subsections (a) through (d), inclusive, of Section 13 of this
Ordinance must have been credited in full up to the date of the delivery
of such Parity Bonds,
(ii) The Net Revenues of the System for the last completed Fiscal Year prior
to the issuance of the Parity Bonds (as shown by the audit of an indepen-
dent certified public accountant), or the adjusted Net Revenues of the
System for such year (as defined herein) must equal at least 125% of
Maximum Annual Debt Service computed immediately after the issuance
of the proposed Parity Bonds, but only for those Fiscal Years in which
the Outstanding Bonds immediately prior to such issuance will continue to
be Outstanding Bonds as provided herein.
(iii) Net Revenues of the System may be adjusted as follows:
(A) In the event there shall have been an increase in the rates of the
System from the rates in effect for the preceding Fiscal Year, which
increase is in effect at the time of the issuance of any such Parity
Bonds, the Net Revenues as described hereinabove may be adjusted
to reflect the Net Revenues of the System for the immediately pre-
ceding Fiscal Year as they would have been had said then existing
rates been in effect during all of said Fiscal Year.
(B) Any such adjustment shall be evidenced by the certificate of an in-
dependent consulting engineer or an independent certified public
accountant employed for that purpose, which certificate shall be
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filed with and approved by the Corporate Authorities prior to the
issuance of the proposed Parity Bonds.
(b) Parity Bonds may be issued to refund Outstanding Bonds if the Parity Bonds so
issued (i) do not exceed the principal amount of the Outstanding Bonds to be re-
funded, (ii) do not bear interest at a rate in excess of the Outstanding Bonds to
be refunded, and (iii) do not mature earlier than any Outstanding Bonds not to
be refunded.
(c) Parity Bonds may be issued to refund Outstanding Bonds in order to avoid
default in the payment of principal of or interest on Outstanding Bonds; pro-
vided, they are issued to avoid such default within three months of the date
thereof.
(d) Bonds or other obligations may be issued payable from the Revenues subordi-
nate to the Outstanding Bonds. Such subordinate bonds shall be payable from
the Surplus Account created in Section 13 of this Ordinance.
All bonds issued under this Section shall mature as to principal on May 1 and as to interest
on May 1 and /or November 1.
Contracts or agreements, including long-term and take or pay contracts or agreement,
for the supply of water or the treatment of sewage which by their terms require payment by
the Municipality as an Operation and Maintenance Cost or from the Operation and
Maintenance Account are expressly excluded from the provisions of this Ordinance pertain-
ing to Parity Bonds. Such contracts or agreetnents may be made by the Municipality
notwithstanding any of the provisions herein.
Section 16. Sale of the Bonds. The Bonds shall be executed as in this Ordinance
provided as soon after the passage hereof as may be, and thereupon be deposited with the
Treasurer of the Municipality, and be by said Treasurer delivered to the purchaser thereof,
namely, NBD Bank Lemont, Lemont, Illinois, upon receipt of the purchase price therefor,
the same being not less than par, plus accrued interest to date of delivery, The contract for
the sale of the Bonds, heretofore entered into, be and is in all respects hereby ratified,
approved and confirmed, it being hereby found and determined that said contract is in the
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best interests of the Municipality, and that no person holding any office of the Municipality,
either by election or appointment, is in any manner interested, either directly or indirectly,
in his own name or in the name of any other person, association, trust or corporation, in
said contract for the purchase of the Bonds.
Section 17. Use of Proceeds, Expense Fund. The proceeds derived from the sale of
the Bonds shall be used as follows:
(a) Accrued interest and capitalized interest, if any, shall be credited to the Bond
and Interest Account,
(b) The sum necessary shall be used to provide for the refunding of the Prior
Bonds, and shall be irrevocably deposited with American National Bank and
Trust Cotnpany of Chicago, Chicago, Illinois, the paying agent for the Prior
Bonds, and applied on May 1, 1993, to the payment in full of the Prior Bonds
as called for redemption prior to maturity on May 1, 1993.
(c) Any remaining amounts shall be deposited into a separate fund, hereby created,
designated the "Expense Fund" to be used to pay expenses of issuance.
Disbursements from such fund shall be made from time to time upon the
direction of the Corporate Authorities. Any excess in said fund shall be paid
into the Bond and Interest Account after six months from the date of issuance of
the Bonds.
Section 18. Provisions a Contract. The provisions of this Ordinance shall constitute
a contract between the Municipality and the holders of the Outstanding Bonds and no
changes, additions, or alterations of any kind shall be made hereto, except as herein
provided, so long as there are any Outstanding Bonds.
Section 19. Non - Arbitrage and Tax- Exemption. One purpose of this Section is to
set forth various facts regarding the Bonds and to establish the expectations of the Corporate
Authorities and the Municipality as to future events regarding the Bonds and the use of Bond
proceeds. The certifications and representations made herein and at the time of the issuance
of the Bonds are intended, and may be relied upon, as certifications and expectations
described in Section 1,103- 13(a)(2)(ii) of the U.S. Treasury Regulations dealing with
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arbitrage and rebate (the "Regulations"). The covenants and agreements contained herein
and at the time of the issuance of the Bonds are made for the benefit of the owners from
time to time of the Bonds. The Corporate Authorities and the Municipality agree, certify,
covenant and represent as follows:
(1) All of the amounts received upon the sale of the Bonds, plus all
investment earnings thereon (the "Proceeds") are needed for the purposes for which
the Bonds are being issued.
(2) The Proceeds will be used within 30 days after the date of issuance of the
Bonds to pay the costs of refunding the Prior Bonds (the "Refitcnding "),
(3) The Municipality has on hand no funds which could legally and
practically be used for the Refunding which are not pledged, budgeted, earmarked or
otherwise necessary to be used for other purposes. Accordingly, no portion of the
Proceeds will be used (1) directly or indirectly to replace funds of the Municipality or
any agency, department or division thereof that could be used for the Refunding, or
(ii) to replace any proceeds of any prior issuance of obligations by the Municipality.
No portion of the Prior Bonds or the Bonds has been or is being issued solely for the
purpose of investing the Proceeds at a Yield higher than the Yield on the Bonds.
None of the Proceeds of the Prior Bonds or the Bonds has been or will be invested in
any investments having a substantially guaranteed Yield for four years or more. For
purposes of this Section, "Yield" means that yield (i,e., discount rate) which when
used in computing the present worth of all payments of principal and interest to be
paid on an obligation (using semi- annual compounding on the basis of a 360 -day year
produces an amount equal to its purchase price, including accrued interest.
(4) Any accrued interest received on the delivery of the Bonds will be
deposited in the Bond Fund and used to pay the first interest due on the Bonds.
Earnings on investment of moneys in a fund will be credited to that fund. Interest on
and principal of the Bonds will be paid from the Bond Fund. No Proceeds will be
used more than one year after the date of issue of the Bonds for the purpose of paying
any principal or interest on any issue of bonds, notes, certificates or warrants or on
any other obligation of the Municipality or for the purpose of replacing any funds of
the Municipality used for such purpose,
(5) The Bond Fund is established to achieve a proper matching of revenues
and earnings with debt service in each bond year. Other than any amounts held to pay
principal of matured Bonds that have not been presented for payment, it is expected
that any moneys deposited in the Bond Fund will be spent within the 12- tnonth period
beginning on the date of deposit therein. Any earnings from the investment of
amounts in the Bond Fund will be spent within a one -year period beginning on the
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date of receipt of such investment earnings. Other than any amounts held to pay
principal of matured Bonds that have not been presented for payment, it is expected
that the Bond Fund will be depleted at least once a year, except for a reasonable
carryover atnount not to exceed the greater of (i) one - year's earnings on the
investment of moneys in the Bond Fund, or (ii) in the aggregate, one- twelfth (1 /12th)
of the annual debt service on the Bonds.
(6) Other than the Bond Fund, no funds or accounts have been or are
expected to be established, and no moneys or property have been or are expected to be
pledged (no tnatter where held or the source thereof) which will be available to pay,
directly or indirectly, the Bonds or restricted so as to give reasonable assurance of
their availability for such purposes. No property of any kind is pledged to secure, or
is available to pay, obligations of the Municipality to any credit enhancer or liquidity
provider.
(7) (a) All amounts on deposit in the Bond Fund and all Proceeds, no tnatter
in what funds or accounts deposited ( "Gross Proceeds "), to the extent not exempted in
(b) below, and all amounts in any fund or account pledged directly or indirectly to the
payment of the Bonds which will be available to pay, directly or indirectly, the Bonds
or restricted so as to give reasonable assurance of their availability for such purpose
contrary to the expectations set forth in (6) above, shall be invested at market prices
and at a Yield not in excess of the Yield on the Bonds,
(b) The following may be invested without Yield restriction;
(1) amounts invested in obligations described in Section 103(a) of the
Internal Revenue Code the interest on which is not includable in the gross
income of any owner thereof for federal income tax purposes;
(ii) atnounts deposited in the Bond Fund that are reasonably expected to
be expended within 12 months from the deposit date and have not been on
deposit therein for more than 13 months;
(iii) amounts in the Expense Fund prior to the earlier of payment of all
expenses to be paid from that account on October 27, 1993,
(iv) amounts in the Project Fund prior to the earlier of completion (or
abandonment) of the Project or three years from the date of issue of the Bonds;
(v) an amount not to exceed $8,000;
(vi) all amounts for the first 30 days after they become Gross Proceeds
(e.g., date of deposit in any fund securing the Bonds);
(vii) amounts deposited in the Bond Reserve Account to the extent they
do not exceed $16,000; and
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•
(viii) all amounts derived from the investment of the Proceeds for a
period of one year from the date received.
(8) Subject to (17) below, once moneys are subject to the Yield limits of
(7)(a) above, they retrain Yield restricted until they cease to be Gross Proceeds.
(9) As set forth in Section 148(1)(4)([]) of the Internal Revenue Code, the
Municipality is excepted from the required rebate of arbitrage profits on the Bonds
because the Municipality is a governmental unit with general taxing powers, none of
the Bonds is a "private activity bond" as defined in Section 141(a) of the Internal
Revenue Code, all the net proceeds of the Bonds are to be used for the local
government activities of the Municipality, and the aggregate face amount of all tax -
exempt obligations issued by the Municipality and all subordinate entities thereof
during the calendar year of issuance of the Bonds, including the Bonds, will not
exceed $5,000,000.
(10) None of the Proceeds of the Prior Bonds or the Bonds has been or will be
used, directly or indirectly, to replace funds which were used in any business carried
on by any person other than a state or local governmental unit.
(11) The payment of the principal of or the interest on the Prior Bonds and
the Bonds has not been and will not be, directly or indirectly (A) secured by any
interest in (i) property used or to be used for a private business use by any person
other than a state or local governmental unit, or (ii) payments in respect of such
property, or (B) derived from payments (whether or not by or to the Municipality),
in respect of property, or borrowed money, used or to be used for a private business
use by any person other than a state or local governmental unit.
(12) None of the Proceeds of the Prior Bonds or the Bonds has been or will be
used, directly or indirectly, to make or finance Loans to persons other than a state or
local governmental unit.
(13) No user of the facilities financed by the Prior Bonds (the "Facilities ")
other than a state or local government unit will use the Facilities on any basis other
than the same basis as the general public, and no person other than a state or local
governmental unit will be a user of the Facilities as a result of (i) ownership, or (ii)
actual or beneficial use pursuant to a lease or a management or incentive payment
contract, or (iii) any other similar arrangement,
(14) Subsequent to 31 days prior to the Bond sale date, the Municipality has
not sold or delivered, and will not sell or deliver (nor will it deliver within 31 days
after the date of issue of the Bonds), any other obligations pursuant to a common plan
of financing, which will be paid out of substantially the same source of funds (or
which will have substantially the same claim to be paid out of substantially the same
source of funds) as the Bonds or will be paid directly or indirectly from the Proceeds.
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(15) No portion of the Facilities is expected to be sold or otherwise disposed
of prior to the last maturity of the Bonds.
(16) The Municipality has not been notified of any disqualification or
proposed disqualification of it by the Internal Revenue Service as a bond issuer which
may certify bond issues under Section 1.103.13(a)(2)(ii) of the Regulations.
(17) The Yield restrictions contained in (7) above or any other restriction or
covenant contained herein may be violated or changed if the Municipality receives an
opinion of counsel approving the Bonds to the effect that such violation or change will
not adversely affect the tax exemption of interest on the Bonds to which it is otherwise
entitled.
(18) The Municipality acknowledges that any changes in facts or expectations
from those set forth herein may result in different Yield restrictions or rebate
requirements from those set forth herein and that counsel approving the Bonds should
be contacted if such changes do occur.
(19) None of the proceeds of the Bonds has been or will be used to pay,
directly or indirectly, in whole or in part, for an expenditure that was paid prior to
the date the Bonds were issued.
(20) The Corporate Authorities have no reason to believe the facts, estimates,
circumstances and expectations set forth herein are untrue or incomplete in any
material respect. On the basis of such facts, estimates, circumstances and expectations,
it is not expected that the Proceeds or any other moneys or property will be used in a
manner that will cause the Bonds to be arbitrage bonds within the meaning of Section
148 of the Internal Revenue Code and of the Regulations, To the best of the
knowledge and belief of the Corporate Authorities, such expectations are reasonable
and there are no other facts, estimates and circumstances that would materially change
such expectations.
The Corporate Authorities also certify and further covenant with the purchasers and
holders of the Bonds from time to time outstanding, that so long as any of the Bonds remain
outstanding, moneys on deposit in any fund or account in connection with the Bonds,
whether or not such moneys were derived from the proceeds of the sale of the Bonds or
from any other sources, will not be used in a mariner which will cause the Bonds to be
"arbitrage bonds" within the meaning of Section 148(a) of the Internal Revenue Code, and
any lawful regulations promulgated or proposed thereunder, including Treas. Reg. Sections
1.103 -13, 1,103 -14 and 1.103 -15, as the same presently exist, or may from time to time
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hereafter be amended, supplemented or revised. The Municipality reserves the right,
however, to make any investment of such moneys permitted by Illinois law if, when and to
the extent that said Section 148(a) or regulations promulgated thereunder shall be repealed
or relaxed or shall be held void by final decision of a court of competent jurisdiction, but
only if any investment made by virtue of such repeal, relaxation or decision would not, in
the opinion of counsel of recognized competence in such matters, adversely affect the tax -
exempt status of the Bonds,
The Municipality agrees to comply with all provisions of the Internal Revenue Code,
which if not complied with by the Municipality, would adversely affect the tax - exempt status
of the Bonds. The Municipality further agrees: (a) through its officers, to make such
further specific covenants, representations as shall be truthful, and assurances as may be
necessary or advisable; (b) to consult with counsel approving the Bonds and to comply with
such advice as may be given; (c) to pay to the United States, as necessary, such sums of
money representing required rebates of excess arbitrage profits relating to the Bonds; (d) to
file such forms, statements, and supporting documents as may be required and in a timely
manner; and (e) if deemed necessary or advisable by its officers, to employ and pay fiscal
agents, financial advisors, attorneys, and other persons to assist the Municipality in such
compliance.
Section 20. Registered Form. The Municipality recognizes that Section 149 of the
Code requires the Bonds to be issued and to remain in fully registered form in order that
interest thereon is exempt from federal income taxation under laws in force at the time the
Bonds are delivered. In this connection, the Municipality agrees that it will not take any
action to permit the Bonds to be issued in, or converted into hearer or coupon form.
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Section 21. List of Bondholders. The Bond Registrar shall maintain a list of the
names and addresses of the registered owners of all Bonds.
Section 22, Rights and Duties of Bond Registrar. If requested by the Bond
Registrar, the President and Village Clerk of the Municipality are authorized to execute the
Bond Registrar's standard form of agreement between the Municipality and the Bond
Registrar with respect to the obligations and duties of the Bond Registrar hereunder.
Subject to modification by the express terms of any such agreement, such duties shall include
the following;
(a) to act as bond registrar, authenticating agent, paying agent and transfer
agent as provided herein;
(b) to maintain a list of Bondholders as set forth herein and to furnish such
list to the Municipality upon request, but otherwise to keep such list confidential to the
extent permitted by law;
(c) to give notice of redemption of Bonds as provided herein;
(d) to cancel and/or destroy Bonds which have been paid at maturity or upon
earlier redemption or submitted for exchange or transfer;
(e) to furnish the Municipality at least annually a certificate with respect to
Bonds cancelled and /or destroyed; and
(f) to furnish the Municipality at least annually an audit confirmation of
Bonds paid, Bonds outstanding and payments made with respect to interest on the
Bonds.
The Village Clerk of the Municipality is hereby directed to file a certified copy of this
Ordinance and of the sale proceedings as referred to in Section 16 hereof with the Bond
Registrar.
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Section 23. Designation of Issue. For the purposes of Section 265(b)(3) of the
Code, the Corporate Authorities hereby designate each of the Bonds as a "qualified tax -
exempt obligation" as provided therein. In support of such designation of the Corporate
Authorities state that:
(1) None of the Bonds is a "private activity bond" as defined in Section 141
of the Code;
(2) The Municipality (including all entities subordinate thereof) has not
issued and does not reasonably anticipate issuing in excess of $5,000,000 in tax - exempt
obligations (other than "private activity bonds" as provided in Section 265(b)(3) of the
Code), including the Bonds, during 1993; and
(3) Not more than $5,000,000 of obligations, including the Bonds, issued by
the Municipality (including all entities subordinate thereof) during 1993 have been to
date or will be designated by the Municipality for purposes of said Section 265(b)(3).
Section 24. Severability. If any section, paragraph, clause or provision of this
Ordinance shall be held invalid, the invalidity of such section, paragraph, clause or provision
shall not affect any of the other provisions of this Ordinance.
Section 25. Repealer and Effective Date. All ordinances, resolutions or orders, or
parts thereof, in conflict with the provisions of this ordinance are to the extent of such
conflict hereby repealed. This Ordinance shall take effect immediately upon its passage by
the Corporate Authorities.
PASSED by the Corporate Authorities on April , 1993,
APPROVED: April , 1993,
AYES:
NAYS:
ABSENT:
/s/
resident
RECORDED in the Municipal Records on April , 1993,
(SEAL)
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Trustee moved and Trustee Aft/2-er-ed-4,-41-
seconded the motion that said ordinance as presented and read by the Village Clerk be
adopted.
After a full and complete discussion thereof including a public recital of the nature of
the matter being considered and such other information as would inform the public of the
business being conducted. the President directed that the roll be called for a vote upon the
motion to adopt the ordinance as read.
Upon the roll being called, the following Trustees voted
AYE_ A.�', - lg2/hce / � kc - a-le-(- )I
NAY: 0
Whereupon the President declared the motion carried and the ordinance adopted, and
henceforth did approve and sign the same in open meeting and did direct the Village Clerk
to record the same in full in the records of the Corporate Authorities of the Municipality.
Other business not pertinent to the adoption of said ordinance was duly transacted at
said meeting.
Upon motion duly made and seconded, the meeting was adjourned.
STATE OF ILLINOIS
COUNTY OF COOK
) SS
CERTIFICATION OF ORDINANCE AND MINUTES
I, the undersigned, do hereby certify that I am the duly qualified and acting Village
Clerk of the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the
"Municipality"), and as such officer I am the keeper of the books, records, files, and journal
of proceedings of the Municipality and of the President and Board of Trustees (the
"Corporate Authorities ") thereof.
I do further certify that the foregoing constitutes a full, true and complete transcript
of the minutes of the legally convened meeting of the Corporate Authorities held on the 12th
day of April, 1993, insofar as same relates to the adoption of an ordinance numbered
and entitled:
AN ORDINANCE authorizing and providing for the issue of
$160,000 Waterworks and Sewerage Refunding Revenue Bonds,
Series 1993, of the Village of Lemont, Cook, DuPage and Will
Counties, Illinois, for the purpose of refunding outstanding
waterworks and sewerage revenue bonds of said Village,
prescribing all the details of said bonds, and providing for the
collection, segregation and distribution of the revenues of the
combined waterworks and sewerage system of said Village.
a true, correct and complete copy of which said ordinance as adopted at said meeting appears
in the foregoing transcript of the minutes of said meeting.
I do further certify that the deliberations of the Corporate Authorities on the adoption
of said ordinance were taken openly; that the vote on the adoption of said ordinance was
taken openly; that said meeting was held at a specified time and place convenient to the
public; that notice of said meeting was duly given to all of the news media requesting such
notice of said meeting was duly given to all of the news media requesting such notice; that
said meeting was called and held in strict accordance with the provisions of the Open
Meetings Act of the State of Illinois, as amended; and that the Corporate Authorities have
complied with all of the applicable provisions of said Act and their procedural rules in the
adoption of said ordinance.
IN WITNESS WHEREOF, I have hereunto affixed my official signature and the seal of
the Municipality, this aZday of April, 1993.
(SEAL)
()Atxge..1400,17.1eliez,---
Village Clerk
STATE OF ILLINOIS )
) SS
COUNTY OF COOK )
CERTIFICATE OF PUBLICATION IN PAMPHLET FORM
I, the undersigned, do hereby certify that I am the duly qualified and acting Village
Clerk of the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Village"),
and as such official I am the keeper of the official journal of proceedings, books, records,
minutes and files of the Village and of the President and Board of Trustees thereof (the
"Corporate Authorities").
I do further certify that on the /02- day of April, 1993, there was published in
pamphlet form, by authority of the Corporate Authorities, a true, correct and complete copy
of Ordinance No. 77, of the Village authorizing the issuance of $160,000 Waterworks
and Sewerage Refunding Revenue Bonds, Series 1993, of the Village and that said ordinance
as so published was on said date readily available for public inspection and distribution, in
sufficient number, at my office as Village Clerk located in the Village.
IN WITNESS WHEREOF, I hereto affix my official signature and the seal of the
Village, this
(SEAL)
day of April, 1993.