O-58-12 08-27-12ORDINANCE NO. /G�_
AN ORDINANCE AUTHORIZING THE ISSUANCE OF GENERAL
OBLIGATION WATERWORKS AND SEWERAGE REFUNDING BONDS
(ALTERNATE REVENUE SOURCE), SERIES 2012C, OF THE VILLAGE
OF LEMONT, COOK, DUPAGE AND WILL COUNTIES, ILLINOIS,
PROVIDING THE DETAILS OF SUCH BONDS AND FOR ALTERNATE
REVENUE SOURCES AND THE LEVY OF DIRECT ANNUAL TAXES
SUFFICIENT TO PAY THE PRINCIPAL OF AND INTEREST ON SUCH
BONDS, AND RELATED MATTERS
WHEREAS, the Village of Lemont, Cook, DuPage and Will Counties, Illinois
(the "Issuer "), is a non -home rule municipality duly established and operating in accordance
with the provisions of the Illinois Municipal Code (Section 5/1 -1 -1 et seq. of Chapter 65 of the
Illinois Compiled Statutes, as supplemented and amended, the "Illinois Municipal Code "),
presently operates a combined waterworks and sewerage system (the "System ") under Section
11 -139 -1 et seq. of the Illinois Municipal Code (the "Waterworks and Sewerage Revenue
Act "), and is entitled to receive a certain distributive revenue share of proceeds from (i) the State
of Illinois income taxes (such distributive share referred to herein as the "Revenue Sharing
Receipts ") imposed by the State of Illinois pursuant to the Illinois Income Tax Act and
distributed pursuant to the State Revenue Sharing Act and (ii) the Retailer's Occupation Taxes,
Service Occupation Taxes, Use Taxes and Service Use Taxes (as applicable, collectively "Sales
Taxes "), distributed pursuant to applicable law; and
WHEREAS, the Issuer's President and Board of Trustees (the "Corporate
Authorities ") hereby in 2004 determined that it was advisable, necessary and in the best
interests of the Issuer's public health, safety and welfare to finance the acquisition, construction
and installation of a waterworks and sewerage system component of a public works facility,
homeland security upgrades, water well #6 and a related well house (including, as applicable,
waterworks and system facilities previously financed under an annexation agreement and land
acquisition and rights in real estate, mechanical and electrical work and other related facilities,
improvements and costs, in one or more phases, as applicable, collectively, the "Project "),
pursuant to the plans and specifications therefore concerning the Project, and to finance the
Project on December 22, 2004 issued $5,690,000 initial principal amount General Obligation
Waterworks and Sewerage Bonds (Alternate Revenue Source), Series 2004 (the "Prior
Obligations "), under Ordinance No. 0- 90 -04, adopted November 22, 2004 (the "Prior
Ordinance "), and to achieve cost savings the Issuer proposes to refund the Prior Obligations
(the "Refunding "), including by funding, as applicable, an escrow, deposit or refunding account
(as applicable, "Refunding Account ") under an escrow, deposit of refunding agreement (a
applicable, "Refunding Agreement ") by and between the Issuer and a designated escrow,
deposit or refunding agent (as applicable, "Refunding Agent "); and
WHEREAS, in connection with Section 2 of Ordinance No. 0- 69 -04, AN
ORDINANCE AUTHORIZING THE ISSUANCE OF WATERWORKS AND SEWERAGE
REVENUE BONDS (SALES TAXES AND REVENUE SHARING RECEIPTS PLEDGE)
AND ALTERNATE REVENUE SOURCE BONDS (IN LIEU OF SUCH REVENUE BONDS)
OF THE VILLAGE OF LEMONT, COOK, DUPAGE AND WILL COUNTIES, ILLINOIS TO
FINANCE WATERWORKS AND SEWERAGE SYSTEM IMPROVEMENTS (the
"Preliminary Ordinance"), adopted October 11, 2004, and which was duly published together
with the required notices in the Daily Southtown, published in Tinley Park, Illinois, and of
general circulation in Lemont, Illinois, the Issuer received no petitions in connection with the
Prior Obligations, forms of petitions therefor being at all relevant times available in the office of
the Village Clerk; and
WHEREAS, on November 8, 2004, with notice having been published on
October 16, 2004, in the Daily Southtown, Tinley Park, Illinois, the Issuer held and conducted
the required public hearing under the Bond Issue Notification Act for the Prior Bonds; and
WHEREAS, the Issuer has insufficient funds to pay the costs of the Refunding
and, therefore, must borrow money and issue general obligation waterworks <and sewerage
refunding bonds (alternate revenue source) under this ordinance in evidence thereof up to the
aggregate principal herein set forth for such purpose; and
WHEREAS, pursuant to and in accordance with the Illinois Municipal Code and
the provisions of Section 15 of the Local Government Debt Reform Act (Section 350/15 of
Chapter 30 of the Illinois Compiled Statutes), as supplemented and amended, and this ordinance,
as supplemented, the Issuer is authorized to issue its General Obligation Waterworks and
Sewerage Refunding Bonds (Alternate Revenue Source), Series 2012C, up to the aggregate
principal amount of $4,000,000 (the "Bonds "), for the purpose of providing funds for the
Refunding; and
WHEREAS, in connection with the offering of the Bonds, as described in the
Preliminary Official Statement therefor (as prepared in preliminary form and completed and
supplemented to be final, the "Official Statement "), as supplemented from time to time by the
Issuer's Continuing Disclosure Certificate and Agreement (the "Disclosure Agreement") under
Rule 15c2 -12 of the Securities and Exchange Commission ( "Rule 15c2 -12"); and
WHEREAS, for convenience of reference only this ordinance is divided into
numbered sections with headings, this shall not define or limit the provisions hereof, as follows:
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Page
Preambles...............................................................................
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Section1.
Definitions ............................................................ ...............................
3
Section
2.
Authority and Purpose ......................................... ...............................
6
Section
3.
Authorization and Terms of Bonds ...................... ...............................
6
Section
4.
Related Agreements and Official Notice ............. ...............................
10
Section
5.
Execution and Authentication .............................. ...............................
11
Section
6.
Transfer, Exchange and Registration .................... ...............................
11
Section
7.
Bond Registrar and Paying Agent ......................... ...............................
14
Section
8.
Alternate Bonds; General Obligations ................. ...............................
15
Section9.
Form of Bonds ...................................................... ...............................
17
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Section 10.
Levy and Extension of Taxes ................................ ...............................
22
Section 11.
System Fund and Accounts ................................... ...............................
23
Section12.
Flow of Funds ....................................................... ...............................
23
Section 13.
Bond Proceeds Account ........................................ ...............................
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Section 14.
Arbitrage Rebate .................................................. ...............................
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Section 15.
Investment Regulations ......................................... ...............................
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Section 16.
Non - Arbitrage and Tax- Exemption ..................... ...............................
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Section 17.
Further Assurances and Actions ........................... ...............................
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Section 18.
General Covenants ............................................... ...............................
32
Section 19.
Ordinance to Constitute a Contract ....................... ...............................
35
Section 20.
Severability and No Contest ................................. ...............................
35
Section 21.
Bank Qualified Bonds ........................................... ...............................
35
Section22.
Repeal ................................................................... ...............................
35
Section 23.
Effective Date ................................. ............................... ....................
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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. Certain words and terms used in this ordinance shall
have the meanings given them herein, including above in the preambles hereto, and the meanings
given them in this Section 1, unless the context or use clearly indicates another or different
meaning is intended. Certain definitions are as follows:
"Act" means, collectively, the Local Government Debt Reform Act (Section
350/1 et sea. of Chapter 30 (and particularly Section 350 /15 thereof) of the Illinois Compiled
Statutes and the Illinois Municipal Code, as supplemented and amended, including, without
limitation, by the Registered Bond Act, the Illinois Bond Replacement Act and the Bond
Authorization Act.
"Alternate Bonds" means "alternate bonds" as described in Section 15 of the
Local Government Debt Reform Act (Section 350/15 of Chapter 30 of the Illinois Compiled
Statutes).
"Arbitrage Regulation Agreement" means, as applicable to the Bonds, the
Issuer's Arbitrage Regulation Agreement in connection with, among other things, arbitrage
rebate under Section 148(f)(2) of the Code and Yield Reduction Payments under Section 1.148 -
5(c) of the Income Tax Regulations.
"Bona fide debt service fund" or "BFDSF" means a fund or account that: (1) is
used primarily to achieve a proper matching of revenues with principal and interest payments
within each bond year; and (2) is depleted at least once each bond year, except for a reasonable
carryover amount not to exceed the greater of: (i) the earnings on the fund for the immediately
proceeding bond year, or (ii) one - twelfth of the principal and interest payments on the issue for
the immediately preceding Bond Year.
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"Bond" or "Bonds" means the Issuer's $4,000,000 maximum aggregate principal
amount General Obligation Waterworks and Sewerage Refunding Bonds (Alternate Revenue
Source), Series 2012C, authorized to be issued by this ordinance.
"Bond Order" shall have the meaning in Section 3(a).
"Code" means the Internal Revenue Code of 1986, as amended, and includes
related and applicable Income Tax Regulations promulgated by the Treasury Department.
"Corporate Authorities" means the President and Board of Trustees of the
Issuer.
"Disclosure Agreement" means the Issuer's Continuing Disclosure Certificate
and Agreement under Rule 15c2 -12 related to the Bonds.
"Fiscal Year" means the twelve -month period constituting the Issuer's fiscal
year, not inconsistent with applicable law.
"Future Bond Ordinances" means the ordinances of the Issuer authorizing the
issuance of revenue bonds payable from Pledged Revenues, but not including this ordinance or
any other ordinance authorizing the issuance of alternate bonds.
"Gross Revenues" means all receipts of fees, charges and rates and all other
income from whatever source derived from the System, including: (i) investment income; (ii)
connection, permit and inspection fees and the like; and (iii) penalties and delinquency charges;
(iv) capital development, reimbursement, or recovery charges and the like; and (v) annexation or
pre- annexation charges insofar as designated by the Corporate Authorities as paid for System
connection or service; but excluding expressly (a) nonrecurring income from the sale of real
estate; (b) governmental or other grants; (c) advances or grants made to or from the Issuer; (d)
capital development, reimbursement, or recovery charges and the like; (e) annexation or
preannexation charges; and (f) as otherwise determined in accordance with generally accepted
accounting principles for municipal enterprise funds.
"Issuer" means the Village of Lemont, Cook, DuPage and Will Counties, Illinois.
"Net Revenues" means, with respect to the System, Gross Revenues minus
Operation and Maintenance Expenses.
"Operation and Maintenance Expenses" means all expenses of operating,
maintaining and routine repair of the System, including wages, salaries, costs of materials and
supplies, power, fuel, insurance, purchase of System services (including all payments by the
Issuer pursuant to long term contracts for such services) and all reasonable administrative fees
and expenses; but excluding debt service, depreciation, or any reserve requirements; and any
costs of extending or enlarging the System or engineering expenses in anticipation thereof or in
connection therewith; and otherwise as determined in accordance with generally accepted
accounting principles for municipal enterprise funds.
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"Outstanding Bonds" means the Bonds, other Alternate Bonds and Parity Bonds
which are outstanding and unpaid; provided, however, such term shall not include the Bonds,
Parity Bonds or other Alternate 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 and interest thereof, or (ii) the provision for payment of which has been made by the
Issuer by the deposit in an irrevocable trust or escrow of funds or direct, full faith and credit
obligations of the United States of America, the principal and interest of which will be sufficient
to pay at maturity or as called for redemption all the principal of and applicable premium on such
Bonds, other Alternate Bonds and Parity Bonds and will not result in the loss of the exclusion
from gross income of the interest thereon under Section 103 of the Code.
"Parity Bonds" means bonds or any other obligations to be issued subsequent in
time to the Bonds and which will share ratably and equally in one or more of the sources of the
Pledged Revenues with the Bonds and other Alternate Bonds and either qualify as Alternate
Bonds or if revenue bonds do not adversely affect the Alternate Bond qualification of the Bonds.
"Pledged Revenues" means the Net Revenues of the System, constituting
"enterprise revenues," and, if not deleted in a Bond Order, Sales Taxes and /or Revenue Sharing
Receipts, each constituting a "revenue source," under the Local Government Debt Reform Act.
"Pledged Taxes" shall have the meaning in Sections 8 and 10.
"Prior Obligations" and "Prior Ordinance" each shall have the meaning set
forth in the recitals in the preamble to this ordinance.
"Project" means the acquisition, construction and installation of System
facilities, and related improvements and facilities, as more fully set forth in the recitals in the
preamble to this ordinance.
"Purchase Agreement" means the Bond purchase contract to be entered into by
and between the Issuer and the Underwriter in connection with the Bonds.
"Qualified Investments" means legal investments by the Issuer under applicable
law.
"Refunding ", "Refunding Account ", "Refunding Agent" and "Refunding
Agreement' each shall have the meaning set forth in the recitals in the preamble to this
ordinance.
"Revenue Sharing Receipts" shall have the meaning set forth in the recitals in
the preamble to this ordinance.
this ordinance.
"Rule 15c2 -12" shall have the meaning set forth in the recitals in the preamble to
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"Sales Taxes" shall have the meaning set forth in the recitals in the preamble to
this ordinance.
"System" shall have the meaning set forth in the recitals in the preamble to this
ordinance.
"Underwriter" means Bernardi Securities, Inc., Chicago, Illinois, the initial
purchaser and underwriter in connection with the Bonds.
"Yield" or "yield" means yield computed under Section 1.148 -4 of the Income
Tax Regulations for the Bonds, and yield computed under Section 1.148 -5 of the Income Tax
Regulations for an investment.
"Yield Reduction Payments" or "-yield reduction payments" shall have the
meaning in Income Tax Regulations Section 1.148 -5(c).
"Yield Restricted" or "yield restricted" with reference to an obligation means
that the yield thereon is limited to the yield on the Bonds.
Section 2. Authority and Purpose. This ordinance is adopted pursuant to the
Constitution and applicable laws of the State of Illinois, including the Act, for the purpose of
refinancing the Project by the Refunding, and related costs and expenses.
Section 3. Authorization and Terms of Bonds. To meet all or a part of the
estimated costs of the Refunding and related costs, there is hereby allocated a sum of up to
$4,000,000, to be derived from the proceeds of the Bonds. For the purpose of financing all or a
part of such allocation, Bonds of the Issuer shall be issued and sold in the aggregate principal
amount set forth above, shall each be designated "General Obligation Waterworks and
Sewerage Refunding Bond (Alternate Revenue Source), Series 2012C ", and shall be issuable
in the denomination of $5,000 each or any authorized integral multiple thereof. The Bonds shall
be and constitute Alternate Bonds and are "general obligation bonds ".
(a) General Terms. The Bonds shall be numbered consecutively from 1 upwards
in order of their issuance and may bear such identifying numbers or letters as shall be useful to
facilitate the registration, transfer and exchange of the Bonds. As determined in an order to
authenticate, the Bonds shall be dated as of or before the date or dates of the issuance and
delivery thereof as acceptable to the Underwriter. The Bonds are hereby authorized to bear
interest at the rates percent per annum (not to exceed 5.0 %) and shall mature in the principal
amount on December 1 of each of the years, commencing not before 2012 and ending not later
than 2024, as shall be specified in a Bond Order (as provided below), but not to exceed
$4,000,000 in the aggregate principal amount.
Each Bond shall bear interest from its date, or from the most recent interest
payment date to which interest has been paid, computed on the basis of a 360 -day year consisting
of twelve 30 -day months, and payable in lawful money of the United States of America
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semiannually on each June 1 and December 1, commencing on or after December 1, 2012, at the
rate or rates percent per annum herein authorized. The Issuer shall provide sufficient moneys to
the Paying Agent to pay the principal of and /or interest on the Bonds at least two business days
prior to each such June 1 and December 1. The Bonds shall bear interest at such rates and
mature in the principal amount in each year, but not exceeding $4,000,000 in the aggregate, and
have such other terms and provisions, as set forth in a Bond Order. For purposes of the
foregoing and otherwise in this ordinance, the term "Bond Order" shall mean a certificate
signed by the Village President, and attested by the Village Clerk and under the seal of the
Issuer, setting forth and specifying details of the Bonds, including, but not limited to,
identification of the Bond Registrar and/or Paying Agent and/or Refunding Agent, and Bond
insurer (the "Insurer ") issuing a bond insurance policy or other credit facility (the "Policy "),
deletion of Sales Taxes and/or Revenue Sharing Receipts as a "revenue source ", payment dates,
call dates, final interest rates, optional and mandatory call provisions, reoffering premium,
original issue discount ( "OID "), and the final maturity schedule, specification of Prior
Obligations to be refunded and specification of Pledged Taxes. The principal of and premium, if
any, on the Bonds shall be payable in lawful money of the United States of America upon
presentation and surrender thereof at the designated corporate trust office of the financial
institution under this ordinance to act as the Paying Agent for the Bonds (including its
successors, the "Paying Agent "). Interest on the Bonds shall be payable on each interest
payment date to the registered owners of record appearing on the registration books maintained
by the financial institution designated in this ordinance to act as Bond Registrar on behalf of the
Issuer for such purpose (including its successors, the "Bond Registrar "), at the principal
corporate trust office of the Bond Registrar as of the close of business on the fifteenth (15th) day
(whether or not a business day) of the calendar month next preceding the applicable interest
payment date. Interest on the Bonds shall be paid by check or draft mailed by the Paying Agent
to such registered owners at their addresses appearing on the registration books.
(b) Redemotion. The Bonds are subject to redemption, if at all, as follows:
(i) Optional. Bonds maturing on and after December I of the year specified in a Bond
Order are subject to redemption prior to maturity at the option of the Issuer in whole or in part on
any date or in part on any interest payment date on and after December 1 of the year specified in
a Bond Order at a redemption price equal to the principal amount to be redeemed plus accrued
interest to the redemption date, in the principal amount from such maturities or in any order of
maturity, as the Issuer shall specify (but in inverse order of there is no such specification), less
than all of the Bonds of a single maturity to be selected by lot as the Bond Registrar determines,
on the applicable redemption date and at a redemption price equal to the principal amount to be
so redeemed, plus accrued interest to the redemption date.
(ii) Mandatory Redemption. Bonds maturing on December 1 of the year or years
specified in a Bond Order as Term Bond are Term Bonds (collectively, the "Term Bonds "), and
are subject to mandatory sinking fund redemption in the principal amount on December 1 of the
years as specified, and not otherwise.
At its option before the 45th day (or such lesser time acceptable to the Bond
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Registrar) next preceding any mandatory sinking fund redemption date in connection with Term
Bonds the Issuer by furnishing the Bond Registrar and the Paying Agent as appropriate
certificate of direction and authorization executed by the Village President or Village
Administrator or Village Clerk may: (i) deliver to the Bond Registrar for cancellation Term
Bonds in any authorized aggregate principal amount desired; or (ii) furnish the Paying Agent
funds for the purpose of purchasing any of such Term Bonds as arranged by the Issuer; or (iii)
received a credit (not previously given) with respect to the mandatory sinking fund redemption
obligation for such Term Bonds which prior to such date have been redeemed and cancelled.
Each such Bond so delivered, previously purchased or redeemed shall be credited at 100% of the
principal amount thereof, and any excess shall be credited with regard to future mandatory
sinking fund redemption obligations for such Bonds in chronological order, and the principal
amount of Bonds to be so redeemed as provided shall be accordingly reduced. In the event
Bonds being so redeemed are in a denomination greater than $5,000, a portion of such Bonds
may be so redeemed, but such portion shall be in the principal amount of $5,000 or any
authorized integral multiple thereof.
(iii) Procedure. The Bonds shall be redeemed only in the principal amount of $5,000
each and integral multiples thereof. The Issuer at least forty-five (45) days prior to the
redemption date (unless a shorter time period shall be satisfactory to the Bond Registrar) shall
notify the Bond Registrar of such redemption date and of the principal amount of Bonds to be
redeemed. No such notice shall be required under (ii). For purposes of any redemption of less
than all of the outstanding Bonds of a single maturity, the particular Bonds or portions of Bonds
to be redeemed shall be selected at least thirty (30) days prior to the redemption date by the Bond
Registrar from the outstanding Bonds of the longest maturity or maturities by such method as the
Bond Registrar shall deem fair and appropriate and which may provide for the selection for
redemption of Bonds or portions of Bonds in principal amounts of $5,000 and integral multiples
thereof.
The Bond Registrar shall promptly notify the Issuer in writing of the Bonds or
portion 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 registered owner or owners of the Bonds to be redeemed,
presentment being deemed conclusively a waiver, notice of the call for any such redemption
shall be given by the Bond Registrar on behalf of the Issuer by mailing the redemption notice by
first class mail at least thirty (30) days and not more than sixty (60) days prior to the date fixed
for redemption to the registered owner or owners of the Bond or Bonds to be redeemed at the
addresses shown on the Bond Register or at such other address as is furnished in writing by such
registered owner or owners to the Bond Registrar.
All notices of redemption shall state: (1) the redemption date; (2) the redemption
price; (3) if less than all outstanding Bonds are to be redeemed, the identification (and, in the
case of partial redemption, the respective principal amounts in integral multiples of $5,000) of
the Bonds to be redeemed; (4) that on the redemption date the redemption price will become due
and payable upon each such Bond or portion thereof called for redemption and, upon the deposit
of funds therefor with the Paying Agent, that interest thereon shall cease to accrue from and after
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such redemption date; and (5) the place where such Bonds are to be surrendered for payment of
the redemption price, which place of payment shall be the principal corporate trust office of the
Paying Agent.
Prior to any redemption date, the Issuer shall deposit with the Paying Agent 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 Issuer
shall not have sufficient funds so on deposit for the payment of the redemption price) such Bonds
or portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption
in accordance with the notice therefor, such Bonds shall be paid by the Paying Agent at the
redemption price. Installments of 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 thereof an new Bond or Bonds of the same
maturity in the amount of the unpaid principal.
Official 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 Issuer 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 of a Bond, shall affect the sufficiency of such notice
with respect to other registered owners. Notice having been properly given, failure of a
registered owner of a Bond 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 of a Bond 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 such notice,
such Bonds shall be paid by the Paying Agent at the redemption price. The procedure for the
payment of interest due as part of the redemption price shall be as herein provided for payment
of interest otherwise due. Upon surrender for any partial redemption of any Bond, there shall be
prepared for the registered owner a new Bond or Bonds of like tenor, of authorized
denominations, of the same maturity, and bearing the same rate of interest in the amount of the
unpaid principal.
In addition to the foregoing notice, further notice may (but is not required to) be
given by the Bond Registrar on behalf of the Issuer as set out below, but no defect in such further
notice nor any failure to give all or any portion of such further notice shall in any manner defeat
the effectiveness of a call for redemption if notice thereof is given as above prescribed. Each
further notice of redemption given hereunder shall contain the information required above for an
official notice of redemption plus: (a) the CUSIP numbers or other identifying number of all
Bonds being redeemed; (b) the date of issue of the Bonds as originally issued; (c) the rate of
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interest borne by each Bond being redeemed; (d) the maturity date of each Bond being
redeemed; and (e) any other descriptive information needed to identify accurately the Bonds
being redeemed. Each further notice of redemption shall be sent at least thirty (30) days before
the redemption date to all registered securities depositories then holding any of the Bonds.
Upon the payment of the redemption price of Bonds being redeemed, each check
or other transfer of funds issued for such purpose shall bear the CUSIP or other identifying
number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such
check or other transfer.
As part of their respective duties hereunder, the Bond Registrar and Paying Agent
shall prepare and forward to the Issuer a statement as to notice given with respect to each
redemption together with copies of the notices as mailed and published.
(c) Transfer. The Bond Registrar shall not be required to exchange or transfer
any Bond during the period from the fifteenth (15th) day of the calendar month next preceding
any 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 during a period of fifteen (15)
days next preceding mailing of a notice of redemption of any Bonds.
(d) Parity Bonds. Parity Bonds may be issued pursuant to the terms as may be
determined at the time of authorization thereof.
Section 4. Related Agreements and Official Notice. The Purchase Agreement,
Arbitrage Regulation Agreement, Disclosure Agreement, Refunding Agreement and the Issuer's
Official Statement in connection with the Bonds, in substantially the forms thereof (i) presented
before the meeting of the Corporate Authorities at which this ordinance is adopted or (ii)
customary to transactions such as the Bonds and the Refunding, shall be and are hereby
authorized. All things done with respect to the preparation of the Official Statement and by the
Issuer's Village President, Village Administrator, Village Clerk, Village Treasurer, Village
Attorney, and other officers, in connection with the issuance and sale of the Bonds, shall be and
are hereby in all respects ratified, confirmed and approved. The Village President, Village
Administrator, Village Clerk, Village Treasurer, Village Attorney and other officials of the
Issuer are hereby authorized and directed to do and perform, or cause to be done or performed
for or on behalf of the Issuer, each and every thing necessary for the issuance of the Bonds,
including the proper execution, delivery and performance of the Purchase Agreement, Disclosure
Agreement, Arbitrage Regulation Agreement, and Refunding Agreement and related instruments
and certificates, by the Issuer and the purchase by and delivery of the Bonds to or at the direction
of the Purchaser. No elected or appointed officer of the Issuer is in any manner interested,
directly or indirectly, in his or her own name or in the name of any other person, association,
trust or corporation in the Purchase Agreement.
The Underwriter is hereby authorized to pay for the Bonds in whole or in part, as
the case may be, and receive a credit therefor against the purchase price for the Bonds, by
directly paying for a Policy and other costs of issuance of the Bonds, from Bond proceeds. The
Issuer hereby authorizes the use of the Official Statement related to offering the Bonds for sale.
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Section 5. Execution and Authentication. Each Bond shall be executed in the
name of the Issuer by the manual or authorized facsimile signature of its Village President and
the corporate seal of the Issuer, or a facsimile thereof, shall be thereunto affixed, impressed or
otherwise reproduced or placed thereon and attested by the manual or authorized facsimile
signature of its Village Clerk. Temporary Bonds, preliminary to the availability of Bonds in
definitive form, shall be and are hereby authorized and approved.
In case any officer whose signature, or a facsimile of whose signature, shall
appear on any Bond shall cease to hold such office before the issuance of such Bond, such Bond
shall nevertheless be valid and sufficient for all purposes, the same as if the person whose
signature, or a facsimile thereof, appears on such Bond had not ceased to hold such office. Any
Bond may be signed, sealed or attested on behalf of the Issuer by any person who, on the date of
such act, shall hold the proper office, notwithstanding that at the date of such Bond such person
may not hold such office. No recourse shall be had for the payment of any Bonds against the
Village President or any member of the Board of Trustees or any officer or employee of the
Issuer (past, present or future) who executes the Bonds, or on any other basis.
Each Bond shall bear thereon a certificate of authentication executed manually by
the Bond Registrar. No Bond shall be entitled to any right or benefit under this ordinance or
shall be valid or obligatory for any purpose until such certificate of authentication shall have
been duly executed by the Bond Registrar. 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 executed by the Bond Registrar if signed by an authorized officer of the Bond
Registrar, but it shall not be necessary that the same officer sign the certificate of authentication
on all of the Bonds issued hereunder.
Section 6. Transfer, Exchanee and Reeistration. The Bonds shall be
negotiable, subject to the provisions for registration of transfer contained herein.
(a) General. Each Bond shall be transferable only upon the registration books
maintained by the Bond Registrar on behalf of the Issuer for that purpose at the principal
corporate trust office of the Bond Registrar by the registered owner thereof in person or by such
registered owner's attorney duly authorized in writing upon surrender thereof together with a
written instrument of transfer satisfactory to the Bond Registrar and duly executed by the
registered owner or such registered owner's duly authorized attorney. Upon the surrender for
transfer of any such Bond, the Issuer shall execute and the Bond Registrar shall authenticate and
deliver a new Bond or Bonds registered in the name of the transferee of the same aggregate
principal amount, maturity and interest rate as the surrendered Bond. Bonds, upon surrender
thereof at the principal corporate trust office of the Bond Registrar, with a written instrument
satisfactory to the Bond Registrar, duly executed by the registered owner or such registered
owner's attorney duly authorized in writing, may be exchanged for an equal aggregate principal
amount of Bonds of the same maturity and interest rate and of the denomination of $5,000 each
or any authorized integral multiple thereof, less previous retirements.
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For every such exchange or registration of transfer of Bonds, the Issuer or the
Bond Registrar may make a charge sufficient to reimburse it for any tax, fee or other
governmental charge required to be paid with respect to such exchange or transfer, which sum or
sums shall be paid by the person requesting such exchange or transfer as a condition precedent to
the exercise of the privilege of making such exchange or transfer. No other charge shall be made
for the privilege of making such transfer or exchange. The provisions of the Illinois Bond
Replacement Act shall govern the replacement of lost, destroyed or defaced Bonds.
The Issuer, the Paying Agent and the Bond Registrar may deem and treat the
person in whose name any Bond shall be registered upon the registration books as the absolute
owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving
payment of, or on account of, the principal of, premium, if any, or interest thereon and for all
other purposes whatsoever, and all such payments so made to any such registered owner or upon
such registered owner's order shall be- valid and effectual to satisfy and discharge the liability
upon such Bond to the extent of the sum or sums so paid, and neither the Issuer nor the Paying
Agent or the Bond Registrar shall be affected by any notice to the contrary.
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,
premium (if any) or interest on any Bond shall be made only to or upon the order of the
registered owner thereof or such registered owner's 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
Issuer 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
exchanged in the case of the issuance of a Bond or Bonds for the outstanding portion of a Bond
surrendered for redemption.
The Village President or Village Administrator or Village Treasurer may, in his or
her discretion at any time, designate a bank with trust powers or trust company, duly authorized
to do business as a bond registrar, paying agent, or both, to act in one or both such capacities
hereunder, in the event the Village President or Village Administrator or Village Treasurer shall
determine it to be advisable. Notice shall be given to the registered owners of any such
designation in the same manner, as near as may be practicable, as for a notice of redemption of
Bonds, and as if the date of such successor taking up its duties were the redemption date.
The execution by the Issuer of any fully registered Bond shall constitute full and
due authorization of such Bond, and the Bond Registrar shall hereby be authorized to
authenticate, date and deliver such Bond; provided, however, the principal amount of 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 retired.
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(b) Book -Entry -Only Provisions. Unless otherwise provided in a Bond Order,
the Bonds shall be issued in the form of a separate single fully registered Bond of each series for
each of the maturities of the Bonds. Upon initial issuance, the ownership of each such Bond
shall be registered in the Bond Register therefor in a street name (initially "Cede & Co." for
DTC) of the securities depository (the " Depository", initially The Depository Trust Company of
New York, New York ( "DTC "), or any successor thereto), as nominee of the Depository. The
outstanding Bonds from time to time may be registered in the Bond Register in a street name, as
nominee of the Depository. If not already done, the Village President or Village Administrator
or Village Treasurer is authorized to execute and deliver on behalf of the Issuer such letters to or
agreements with the Depository as shall be necessary to effectuate such book -entry system (any
such letter or agreement being referred to herein as the "Representation Letter "). Without
limiting the generality of the authority given to the Village President or Village Administrator or
Village Treasurer with respect to entering into such Representation Letter, it may contain
provisions relating to (a) payment procedures, (b) transfers of the Bonds or of beneficial interest
therein, (c) redemption notices and procedures unique to the Depository, (d) additional notices or
communications, and (e) amendment from time to time to conform with changing customs and
practices with respect to securities industry transfer and payment practices.
With respect to Bonds registered in the Bond Register in the name of a nominee
of the Depository, the Issuer and the Bond Registrar shall have no responsibility or obligation to
any broker - dealer, bank or other financial institution for which the Depository holds Bonds from
time to time as securities depository (each such broker - dealer, bank or other financial institution
being referred to herein as a "Depository Participant ") or to any person on behalf of whom
such a Depository Participant holds an interest in the Bonds (sometimes referred to as an
"Indirect Participant" or "Beneficial Owner "). Without limiting the meaning of the
foregoing, the Issuer and the Bond Registrar shall have no responsibility or obligation with
respect to (a) the accuracy of the records of the Depository, the nominee, or any Depository
Participant or Indirect Participant or Beneficial Owner with respect to any ownership interest in
the Bonds, (b) the delivery to any Depository Participant or any other person, other than a
registered owner of a Bond as shown in the Bond Register, of any notice with respect to the
Bonds, including any notice of redemption, or (c) the payment to any Depository Participant or
any other person, other than a registered owner of a Bond as shown in the Bond Register, of any
amount with respect to principal of or interest on the Bonds.
As long as the Bonds are held in a book -entry-only system, no person other than
the nominee of the Depository, or any successor thereto, as nominee for the Depository, shall
receive a Bond certificate with respect to any Bonds. Upon delivery by the Depository to the
Bond Registrar of written notice to the effect that the Depository has determined to substitute a
new nominee in place of the prior nominee, and subject to the provisions hereof with respect to
the payment of interest to the registered owners of Bonds as of the close of business on the
fifteenth (15th) day (whether or not a business day) of the month next preceding the applicable
interest payment date, the reference herein to nominee in this ordinance shall refer to such new
nominee of the Depository.
In the event that (a) the Issuer determines that the Depository is incapable of
discharging its responsibilities described herein and in the Representation Letter, (b) the
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agreement among, as applicable, the Issuer, the Bond Registrar, the Paying Agent and the
Depository evidenced by the Representation Letter shall be terminated for any reason or (c) the
Issuer determines that it is in the best interests of the beneficial owners of the Bonds that they be
able to obtain certificated Bonds, the Issuer shall notify the Depository and the Depository
Participants (if known to the Issuer) of the availability of Bond certificates, and the Bonds shall
no longer be restricted to being registered in the Bond Register in the name of a nominee of the
Depository. At that time, the Issuer may determine that the Bonds shall be registered in the
name of and deposited with a successor depository operating a book -entry system, as may be
acceptable to the Issuer, or such depository's agent or designee, and if the Issuer does not select
such alternate book -entry system, then the Bonds may be registered in whatever name or names
registered owners of Bonds transferring or exchanging Bonds shall designate, in accordance with
the provisions hereof. Notwithstanding any other provision of this ordinance to the contrary, so
long as any Bond is registered in the name of a nominee of the Depository, all payments with
respect to principal of and interest on such Bond and all notices with respect to such Bond shall
be made and given, respectively, in the manner provided in the Representation Letter.
(c) Designation of Successor. The Village President or Village
Administrator or Village Treasurer may, as applicable in his or her discretion at any time,
designate a bank or other qualified institution, duly authorized to do business as a Bond registrar,
paying agent, or both, to act in one or both such capacities hereunder, in the event the Village
President or Village Administrator or Village Treasurer shall determine it to be advisable.
Notice shall be given to the registered owners of any such designation in the same manner, as
near as may be practicable, as for a notice of redemption of Bonds, and as if the date of such
successor taking up its duties were the redemption date.
Section 7. Bond Reeistrar and Paving Agent. The Bond Registrar and Paying
Agent with respect to this ordinance and the Bonds shall be Amalgamated Bank of Chicago,
Chicago, Illinois, or otherwise as set forth in a Bond Order. The Issuer covenants that it shall at
all times retain a Bond Registrar and Paying Agent with respect to the Bonds and shall cause to
be maintained at the office of such Bond Registrar a place where Bonds may be presented for
registration of transfer or exchange, that it will maintain at the designated office of the Paying
Agent a place where Bonds may be presented for payment, that it shall require that the Bond
Registrar maintain proper registration books and that it shall require the Bond Registrar and
Paying Agent to perform the other duties and obligations imposed upon each of them by this
ordinance in a manner consistent with the standards, customs and practices concerning municipal
securities. The Issuer may enter into appropriate agreements with the Bond Registrar and Paying
Agent in connection with the foregoing, including as follows:
(a) to act as Bond Registrar, authenticating agent, Paying Agent and transfer agent
as provided herein;
(b) to maintain a list of the registered owners of the Bonds as set forth herein and
to furnish such list to the Issuer upon request, but otherwise to keep such list confidential;
(c) to cancel and/or destroy Bonds which have been paid at maturity or submitted
for exchange or transfer;
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(d) to furnish the Issuer at least annually a certificate with respect to Bonds
cancelled and /or destroyed;
(e) to give notices of redemption of any Bonds subject to redemption; and
(f) to furnish the Issuer at least annually an audit confirmation of Bonds paid,
Bonds outstanding and payments made with respect to interest on the Bonds.
In any event, (a) - (f) above shall apply to the Bond Registrar and Paying Agent.
The Bond Registrar and Paying Agent shall signify their acceptances of the duties
and obligations imposed upon them by this ordinance. The Bond Registrar by executing the
certificate of authentication on any Bond shall be deemed to have certified to the Issuer that it
has all requisite-power to accept, and has accepted, such duties and obligations not only with
respect to the Bond so authenticated but with respect to all of the Bonds. The Bond Registrar
and Paying Agent are the agents of the Issuer for such purposes and shall not be liable in
connection with the performance of their respective duties except for their own negligence or
default. The Bond Registrar shall, however, be responsible for any representation in its
certificate of authentication on the Bonds.
The Issuer may remove the Bond Registrar or Paying Agent at any time. In case
at any time the Bond Registrar or Paying Agent shall resign (such resignation to not be effective
until a successor has accepted such role) or shall be removed or shall become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or if a receiver, liquidator or conservator of
the Bond Registrar or Paying Agent, or of its property, shall be appointed, or if any public officer
shall take charge or control of the Bond Registrar or Paying Agent or of their respective
properties or affairs, the Issuer covenants and agrees that it will thereupon appoint a successor
Bond Registrar or Paying Agent, as the case may be. The Issuer shall mail or cause to be mailed
notice of any such appointment made by it to each registered owner of Bonds within twenty (20)
days after such appointment. Any Bond Registrar or Paying Agent appointed under the
provisions of this Section 7 shall be a bank, trust company or other qualified professional with
respect to such matters, authorized to exercise such functions in the State of Illinois.
Section 8. Alternate Bonds; General Oblieations. The Bonds are and
constitute Alternate Bonds under the Local Government Debt Reform Act, anticipated to be
payable from Pledged Revenues. Under and pursuant to Section 15 of the Local Government
Debt Reform Act, the full faith and credit of the Issuer are hereby irrevocably pledged to the
punctual payment of the principal of, premium, if any, and interest on the Bonds; the Bonds shall
be direct and general obligations of the Issuer; and the Issuer shall be obligated to levy ad
valorem taxes upon all the taxable property within the Issuer's corporate limits, for the payment
of the principal thereof and the interest thereon, without limitation as to rate or amount (such ad
valorem taxes being the "Pledged Taxes").
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If at any time Net Revenues are insufficient to pay debt service on the Bonds or
the deposit to the Debt Service Subaccount under Section 12(d) , the Issuer will levy and deposit
to the Debt Service Subaccount sufficient Pledged Taxes to cover such insufficiency, including
in the event Pledged Taxes are prematurely abated.
Pledged Revenues are hereby determined by the Corporate Authorities to be
sufficient to provide for or pay in each year to final maturity of the Bonds all of the following:
(1) costs of operation and maintenance of the utility or enterprise (i.e., the System), but not
including depreciation, (2) debt service on all outstanding revenue bonds payable from enterprise
revenues, (3) all amounts required to meet any fund or account requirements with respect to such
outstanding revenue bonds, (4) other contractual or tort liability obligations, if any, payable from
such enterprise revenues, and (5) in each year, an amount not less than 1.25 times debt service of
all (i) alternate bonds payable from such enterprise revenues previously issued and outstanding
and (ii) alternate bonds proposed to be issued. To the extent payable from one or more revenue
- sources, the Pledged Revenues shall be and, with appropriate System rates already adopted and
in effect prior, are hereby determined by the Corporate Authorities to provide in each year, an
amount not less than 1.25 times debt service (as defined in Section 2 of the Local Government
Debt Reform Act) of alternate bonds payable from such revenue sources previously issued and
outstanding and alternate bonds proposed to be issued. Such conditions enumerated need not be
met for that amount of debt service (as defined in Section 2 of the Local Government Debt
Reform Act) provided for by the setting aside of proceeds of bonds or other moneys at the time
of the delivery of such bonds. The Pledged Revenues (including as defined in Section 2 of the
Local Government Debt Reform Act) are hereby determined by the Corporate Authorities to
provide in each year Operation and Maintenance Expenses, depreciation and reserve
requirements and an amount not less than 1.25 times debt service (as defined in Section 2 of the
Local Government Debt Reform Act) of all of the Bonds.
The determination of the sufficiency of the Pledged Revenues (including as
defined in Section 2 of the Local Government Debt Reform Act) is presently supported by
reference to the most recent audit of the Issuer, which is for a Fiscal Year ending not earlier than
18 months previous to the time of issuance of the alternate Bonds. If for any reason prior
issuance of and delivery of the Bonds, such audit does not adequately show the sufficiency of
such Pledged Revenues, to the extent required by applicable law, and not otherwise, the
determination of sufficiency shall be required to be supported by the report of an independent
accountant or feasibility analyst, the latter having a national reputation for expertise in such
matters, demonstrating the sufficiency of such revenues and explaining, if appropriate, by what
Pledged Revenues will be greater than as shown in the audit. Whenever the sufficiency of
Pledged Revenues is demonstrated by reference to higher rates or charges and fees for enterprise
revenues (with respect to the use of the services of the System constituting the Pledged
Revenues, including as defined in Section 2 of the Local Government Debt Reform Act), such
higher rates or charges and fees with respect to the use of the services of the System shall have
been properly imposed by an ordinance adopted prior to the time of delivery of the Bonds.
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Section 9. Form of Bonds. The Bonds shall be issued in fully registered form
conforming to the industry customs and practices of printing, including part on the front and part
on the reverse of the certificates, as appropriate, the blanks to be appropriately completed when
the Bonds are printed. 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, as follows:
[The remainder of this page is intentionally left blank.]
_17_
UNITED STATES OF AMERICA
STATE OF ILLINOIS
THE COUNTIES OF COOK, DUPAGE AND WILL
VILLAGE OF LEMONT
GENERAL OBLIGATION WATERWORKS AND SEWERAGE REFUNDING BOND
(ALTERNATE REVENUE SOURCE)
:see Reverse side for :
:Additional Provisions: SERIES 2012C
REGISTERED NO.
INTEREST RATE: MATURITY DATE:
Registered Owner:
Principal Amount:
DATED DATE:
REGISTERED
CUSIP:
KNOW ALL BY THESE PRESENTS that the Village of Lemont, (the
"Issuer") situated in The Counties of Cook, DuPage and Will, in the State of Illinois,
acknowledges itself indebted and for value received hereby promises to pay to the Registered
Owner identified above, or registered assigns, subject to the provisions of the Issuer's
proceedings authorizing this Bond and each Bond of the series of which it is one, the Principal
Amount set forth above on the Maturity Date specified above, and to pay interest on such
Principal Amount from the later of the Dated Date hereof or the most recent interest payment
date to which interest has been paid, at the Interest Rate per annum set forth above, computed on
the basis of a 360 -day year consisting of twelve 30 -day months and payable in lawful money of
the United States of America semiannually on the first day of June and December in each year,
commencing , 201_, until the Principal Amount hereof shall have been paid, by
check or draft mailed to the Registered Owner of record hereof as of the close of business on the
fifteenth (15th) day (whether or not a business day) of the calendar month next preceding such
interest payment date, at the address of such Registered Owner appearing on the registration
books maintained for such purpose at the designated payment of Amalgamated Bank of Chicago,
in Chicago, Illinois, as Bond Registrar (including its successors, the "Bond Registrar "). This
Bond, as to principal and premium, if any, when due, will be payable in lawful money of the
United States of America upon presentation and surrender of this Bond at the designated
principal corporate trust office of Amalgamated Bank of Chicago, in Chicago, Illinois, as Paying
Agent (including its successors, the "Paying Agent "). Although it is expected, and has been
certified, that the Bonds are to be paid from the receipts derived by the Issuer from Net
Revenues[, Sales Taxes and /or Revenue Sharing Receipts], constituting Pledged Revenues (as
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each such term is defined in the hereinafter defined Bond Ordinance authorizing this Bond),
which Pledged Revenues are pledged to the payment thereof, the full faith and credit of the
Issuer, including the power to levy taxes without limit as to rate or amount, are irrevocably
pledged for the punctual payment of the principal of and interest on this Bond and each Bond of
the series of which it is a part, according to the terms thereof. The Bonds are and constitute
Alternate Bonds and are "general obligation bonds."
This Bond is one of a series of Bonds issued in the aggregate principal amount of
$ , which are all of like tenor, except as to maturity, interest rate and right of
redemption, and which are authorized and issued under and pursuant to the Constitution and laws
of the State of Illinois, including the Illinois Municipal Code and Section 15 of the Local
Government Debt Reform Act (Section 350/15 of Chapter 30 of the Illinois Compiled Statutes,
in connection with "alternate bonds ", as supplemented and amended, including by the
Registered Bond Act, the Illinois Bond Replacement Act, the Bond Authorization Act and the
applicable laws authorizing the Pledged Revenues), and pursuant to and in accordance with
Ordinance No. adopted by the Issuer's President and Board of Trustees on
, 2012, and entitled: "An Ordinance Authorizing the Issuance of General Obligation
Waterworks and Sewerage Refunding Bonds (Alternate Revenue Source), Series 2012C, of the
Village of Lemont, Cook, DuPage and Will Counties, Illinois, Providing the Details of Such
Bonds and For Alternate Revenue Sources and the Levy of Direct Annual Taxes Sufficient to
Pay the Principal of and Interest on such Bonds, and Related Matters ". The Bonds are issued to
refinance certain waterworks and sewerage system facilities, and related costs and expenses, by
refunding certain prior alternate bonds, as provided in the Bond Ordinance.
[Insert and adapt, as applicable: Bonds maturing on December I of the years
20 and 20 are Term Bonds (the "Term Bonds "), subject to mandatory sinking fund
redemption in the principal amount on December 1 of each of the years, as follows:
Dec. 1, 20 Term Bonds Dec. 1, 20 Term Bonds
Principal Principal
Year Amount ($) Year Amount($)
*To he paid at maturity unless previously retired.]
[Insert and adapt, as applicable: Bonds maturing on and after December 1, 20_,
are subject to redemption prior to maturity at the option of the Issuer in whole or in part on any
date on and after December 1, 20_, at a redemption price equal to the principal amount to be
redeemed plus accrued interest to the redemption date, in the principal amount from such
maturities or in any order of maturity, as the Issuer shall specify (but in inverse order of there is
no such specification), less than all of the Bonds of a single maturity to be selected by lot as the
Bond Registrar determines, on the applicable redemption date and at a redemption price equal to
the principal amount to be so redeemed, plus accrued interest to the redemption date. OR: The
Bonds are not subject to optional redemption prior to maturity.]
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This Bond is transferable only upon the registration books therefor by the
Registered Owner hereof in person, or by such Registered Owner's attorney duly authorized in
writing, upon surrender hereof at the principal corporate trust office of the Bond Registrar
together with a written instrument of transfer satisfactory to the Bond Registrar duly executed by
the Registered Owner or by such Registered Owner's duly authorized attorney, and thereupon a
new registered Bond or Bonds, in the denomination of $5,000 or any authorized integral multiple
thereof and of the same aggregate principal amount as this Bond shall be issued to the transferee
in exchange therefor. In like manner, this Bond may be exchanged for an equal aggregate
principal amount of Bonds of any authorized denomination.
The Bond Registrar shall not be required to exchange or transfer any Bond during
the period from the fifteenth (15th) day of the calendar month next preceding any 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 during a period of fifteen (15) days next
preceding mailing of a notice of redemption of any Bonds]. The Issuer or the Bond Registrar
may make a charge sufficient to reimburse it for any tax, fee or other governmental charge
required to be paid with respect to the transfer or exchange of this Bond. No other charge shall
be made for the privilege of making such transfer or exchange. The Issuer, the Paying Agent and
the Bond Registrar may treat and consider the person in whose name this Bond is registered as
the absolute owner hereof for the purpose of receiving payment of, or on account of, the
principal, premium, if any, and interest due hereon and for all other purposes whatsoever, and all
such payments so made to such Registered Owner or upon such Registered Owner's order shall
be valid and effectual to satisfy and discharge the liability upon this Bond to the extent of the
sum or sums so paid, and neither the Issuer nor the Paying Agent or the Bond Registrar shall be
affected by any notice to the contrary.
No recourse shall be had for the payment of any Bonds against the Village
President, any member of the Board of Trustees or any other officer or employee of the Issuer
(past, present or future) who executes any Bonds, or on any other basis. The Issuer may remove
the Bond Registrar or Paying Agent at any time and for any reason and appoint a successor.
This Bond shall not be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been duly executed by the Bond Registrar.
The Issuer has designated the Bonds as "qualified tax- exempt obligations"
under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended.
It is hereby certified, recited and declared that all acts, conditions and things
required to be done, exist and be performed precedent to and in the issuance of this Bond in
order to make it a legal, valid and binding general obligation of the Issuer have been done, exist
and have been performed in regular and due time, form and manner as required by law, and that
the series of Bonds of which this Bond is one, together with all other indebtedness of the Issuer
is within every debt or other limit prescribed by law.
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IN WITNESS WHEREOF, the Village of Lemont, Cook, DuPage and Will
Counties, Illinois, has caused this Bond to be executed in its name and on its behalf by the
manual or facsimile signature of its Village President, and its corporate seal, or a facsimile
thereof, to be hereunto affixed or otherwise reproduced hereon and attested by the manual or
facsimile signature of its Village Clerk, all as of the Dated Date set forth above.
(SEAL) VILLAGE OF LEMONT,
Lc!Co uPage and oun 'es, Illinois
A
Village Clerk Village President
CERTIFICATE OF AUTHENTICATION
Dated:
This is one of the General Obligation Waterworks and Sewerage Refunding
Bonds (Alternate Revenue Source), Series 2012C, described in the within mentioned Bond
Ordinance.
AMALGAMATED BANK OF CHICAGO
Chicago, Illinois, as Bond Registrar
By:
Authorized Signer
Bond Registrar Amalgamated Bank of Chicago
and Paying Agent: Chicago, Illinois
ASSIGNMENT
For value received the undersigned sells, assigns and transfers unto
[Name, Address and Tax Identification Number of Assignee]
the within Bond and hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration thereof,
substitution in the premises.
Dated
Signature
Signature Guarantee:
(Name of Eligible Guarantor Institution as defined
by SEC Rule 17 Ad -15 (17 CFR 240.1 Ad -15))
with full power of
Notice: The signature on 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.
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Section 10. Levy and Extension of Taxes. For the purpose of providing the
money required to pay the interest on the Bonds when and as the same falls due and to pay and
discharge the principal thereof as the same shall mature, there shall be levied upon all the taxable
property within the Issuer's corporate limits in each year while any of the Bonds shall be
outstanding, a direct annual tax in the amount in each of the levy years commencing not before
levy year 2012 and ending not later than levy year 2023, sufficient for that purpose, in addition
to all other taxes, as shall be specified in a Bond Order.
To the extent lawful, interest or principal coming due at any time when there shall
be insufficient funds on hand to pay the same shall be paid promptly when due from current
funds on hand in advance of the collection of the Pledged Taxes herein authorized; and when
such Pledged Taxes shall have been collected; reimbursement shall be made to such fund or
funds from which such advance was made in the amounts thus advanced.
As soon as this ordinance becomes effective, a copy hereof certified by the
Village Clerk, which certificate shall recite that this ordinance has been duly adopted, shall be
filed with the County Clerks of Cook, DuPage and Will Counties, Illinois, who are hereby
directed to ascertain the rate percent required to produce the aggregate Pledged Taxes herein
authorized, and to extend the same for collection on the tax books in connection with other taxes
levied in each of such years, in and by the Issuer for general corporate purposes of the Issuer, and
in each of such years such annual tax shall be levied and collected in like manner as taxes for
general corporate purposes for each of such years are levied and collected and, when collected,
such taxes shall be used solely for the purpose of paying the principal of and interest on the
Bonds herein authorized as the same become due and payable.
The Issuer covenants and agrees with the registered owners of the Bonds that so
long as any of the Bonds remain outstanding, unless and to the extent that there then shall be
moneys irrevocably on deposit therefor in the Debt Service Subaccount of the Surplus Account,
the Issuer will take no action or fail to take any action which in any way would adversely affect
the ability of the Issuer to levy and collect the foregoing Pledged Taxes, and the Issuer and its
officers will comply with all present and future applicable laws in order to assure that the
foregoing Pledged Taxes will be levied, extended and collected as provided herein and deposited
in the Debt Service Subaccount established in Section 12(d) below to pay the principal of and
interest on the Bonds. Whenever moneys are irrevocably on deposit in such Debt Service
Subaccount (including by transfer from the Pledged Subaccount) to pay the principal of and/or
interest on the Bonds, the Corporate Authorities or other authorized officer shall by appropriate
supplemental proceedings or direct certification direct the abatement of the Pledged Taxes for
the year with respect to which such Pledged Taxes have been levied to the extent of such deposit,
and appropriate certification of such abatement shall be timely filed with each County Clerk in
connection with such abatement. If for any reason there is abatement of such levy of taxes and
the failure thereafter to pay debt service in respect of such abatement, the additional amount,
together with additional interest accruing, shall be added to the tax levy in the year of, or the next
year following, such failure.
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Section 11. System Fund and Accounts. Upon the issuance of any of the
Bonds, the System shall continue to be operated on a Fiscal Year basis. All of the revenues from
any source whatsoever derived from the operation of the System, together with any other
available funds therefor, shall be set aside as collected and be deposited in a separate fund and in
an account in a bank to be designated or continued, as the case may be, by the Corporate
Authorities, which fund is hereby created, designated or continued, as the case may be, as the
Issuer's "Waterworks and Sewerage Fund" (the "Fund" or the "System Fund"), which shall
constitute a trust fund for the purpose of carrying out the covenants, terms, and conditions of this
ordinance, and shall be used only in paying operation and maintenance expenses of the System,
providing adequate depreciation and reserve funds as herein provided, paying the principal of
and interest on all revenue bonds and obligations of the Issuer which by their terms are payable
solely from the revenues derived from the System, and providing for the establishment of an
expenditure from the respective accounts as hereinafter described (provided that Pledged Taxes
and/or Sales Taxes and/or Revenue Sharing Receipts, as applicable, shall be directly deposited or
credited as herein required).
Section 12. Flow of Funds. There shall be deposited in and credited to the
System Fund all revenues and income of the System as received, and all disbursements for the
Operation and Maintenance Expenses of the System and all allocations and deposits to the
following Accounts shall he made from the System Fund. There shall be and there are hereby
ordered, created and established, or at the Issuer's option continued under the Prior Bond
Ordinance, as the case may be, separate accounts and subaccounts to be known as the
Waterworks and Sewerage System "Operation and Maintenance Account ", "Accounts
Created Pursuant to Future Bond Ordinances ", "Depreciation Account ", and "Surplus
Account" (including therein a "Debt Service Subaccount ", from which debt service on the
Bonds is to be paid and into which, as the case may be, Pledged Taxes, and, as applicable, Sales
Taxes and/or Revenue Sharing Receipts shall be directly deposited or credited and accounted for,
and within such Debt Service Subaccount a "Pledged Subaccount" to hold Pledged Revenues
as herein provided), to which there shall be deposited or credited on or before the first day of
each month by the Issuer's Treasurer or other authorized financial officer of the Issuer, without
any further official action or direction, in the order in which such accounts are hereinafter
mentioned, all moneys held in the System Fund, in accordance with the following provisions:
(a) Operation and Maintenance Account: There shall he deposited and credited
to the Operation and Maintenance Account an amount sufficient, when added to the
amount then on deposit in such Account, to establish a balance equal to an amount not
less than the amount necessary to pay Operation and Maintenance Expenses for the then
current month.
(b) Accounts Created Pursuant to Future Bond Ordinances. Future Bond
Ordinances may create additional accounts in the System Fund for the payment and
security of waterworks and sewerage revenue bonds that hereafter may be issued by the
Issuer. Amounts in the System Fund shall be credited to and transferred from such
accounts in accordance with the terms of the Future Bond Ordinances.
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(c) Depreciation Account: Amounts shall be deposited into the Depreciation
Account from time to time as the Corporate Authorities determine necessary to provide
an adequate depreciation fund for the System. In Future Bond Ordinances, the Issuer
may covenant to make specific monthly deposits to such Depreciation Account and to
accumulate funds therein.
Amounts to the credit of the Depreciation Account shall be used for (i) the payment of
the cost of extraordinary maintenance, necessary repairs and replacements, or
contingencies, the payment for which no other funds are available, in order that the
System may at all times be able to render efficient service and (ii) the payment of
principal of or interest and applicable premium on any Outstanding Bonds at any time
when there are no other funds available for that purpose in order to prevent a default and
shall be transferred to the appropriate account for such purpose.
Future Bond Ordinances may provide for additional uses and transfers of the
funds on deposit in the Depreciation Account.
(d) Surplus: All moneys remaining in the System Fund, after crediting the
required amounts to the respective accounts hereinabove provided for, and after making
up any deficiency in the above Accounts described in subsections (a) through (c),
inclusive, shall be credited to the Surplus Account and then: (i) shall first be used to
make up any subsequent deficiencies in any of the Accounts hereinabove named; (ii)
shall second, after depositing all accrued interest received on the sale of the Bonds on or
before the second business day of the Issuer preceding the first day of each month there
shall be first credited to or deposited into a "Debt Service Subaccount," (within which
there shall be a further (A) "Pledged Taxes Subaccount" into which any Pledged Taxes
shall be directly credited or deposited, and, as applicable, a (B) "Revenue Source
Subaccount" into which, as applicable, Sales Taxes and/or Revenue Sharing Receipts
shall be credited or deposited), from Net Revenues, a pro rata amount (not less than 1/6)
in Pledged Revenues of the installment of interest coming due on the next succeeding
interest payment date and such that the tax levy in Section 10 can be timely abated (the
aggregate being the "Interest Requirement" for the applicable period) on the then
Outstanding Bonds plus a pro rata amount (not less than 1/12) of the installment of
principal coming due on the then Outstanding Bonds on the next succeeding principal
payment or mandatory redemption date on the then Outstanding Bonds and such that the
tax levy in Section 10 can be timely abated (the aggregate being the "Principal
Requirement" for the applicable period), and Pledged Revenues shall be so credited in
full to the Debt Service Subaccount until the Principal Requirement and the Interest
Requirement shall have been met, after which no such deposits shall be required, and
such moneys may be applied to any other lawful System or corporate purposes; and
except as hereinafter provided, moneys to the credit of the Debt Service Subaccount shall
be used solely and only for the purpose of paying principal of and redemption premium,
if any, and interest on the Bonds as the same become due or upon maturity or mandatory
redemption; and (iii) third, at the discretion of the Corporate Authorities, shall be used, if
at all, for one or more of the following purposes (and not for any general corporate
purposes) without any priority among them:
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(I) For the purpose of constructing or acquiring repairs, replacements,
renewals, improvements or extensions to the System; or
(2) For the purpose of calling and redeeming Outstanding Bonds; or
(3) For the purpose of purchasing any Outstanding Bonds; or
(4) For the purpose of paying principal of and interest on any subordinate
bonds or obligations issued for the purpose of acquiring or constructing repairs,
replacements, renewals, improvements and extensions to the System; or
(5) For any purpose enumerated in any Future Bond Ordinance; or
(6) For any other lawful purpose.
(f) Investments: Money to the credit of the System Fund prior to the monthly
accounting and to the credit of the Operation and Maintenance Account may be invested
in Qualified Investments pursuant to any authorization granted to municipal corporations
by Illinois statute or court decision. Money to the credit of the Debt Service Subaccount
may duly be invested from time to time by the Treasurer of the Issuer in Qualified
Investments, as follows: (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, or savings and loan association provided such bank or savings and loan association
is insured by the Federal Deposit Insurance Corporation (FDIC) or a successor
corporation to FDIC, and provided further that the principal of such deposits is secured
by a pledge of obligations as described in clauses (f) (i) and (f) (ii) above in the full
principal amount of such deposits, and otherwise collateralized in such amount and in
such manner as may be required by law. Such investments shall be sold from time to
time by such Treasurer as funds may be needed for the purpose for which such accounts
have been created.
All interest on any funds so invested shall be credited to the applicable fund, account or
subaccount of the System Fund for which the investment was made and is hereby deemed
and allocated as expended with the next expenditure or expenditures of money from such
applicable fund, account or subaccount of the System Fund; provided, however, the
Issuer shall credit such interest in such manner as to not cause the Bonds to be
"arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of
1986, as amended, and applicable Income Tax Regulations.
Moneys in any of such accounts shall be invested by the Treasurer, if necessary, in
investments restricted as to yield, which investments may be in U.S. Treasury Securities -
State and Local Government Series, if available, and to such end the Treasurer shall refer
to any investment restrictions covenanted by the Issuer or any officer thereof as part of
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the transcript of proceedings for the issuance of the Bonds, and to appropriate opinions of
counsel.
(g) Bona Fide Debt Service Fund: Moneys preliminary to deposit in subsection
(d) above and used to abate Pledged Taxes under Section 10 above, which if deposited
into the Debt Service Subaccount would disqualify such Debt Service Subaccount as a
"bona fide debt service fund" shall be held in a separate Pledged Subaccount (the
"Pledged Subaccount") of the Debt Service Subaccount and the investment yield
thereon subject to yield restriction and to yield reduction payments.
Section 13. Bond Proceeds Account. Unless applied directly by the
Underwriter to directly pay for, as applicable, a Policy and other costs of issuance of the Bonds,
as is hereby approved, all of the proceeds derived from the sale of the Bonds (exclusive of
accrued interest) shall be deposited in the "Bond Proceeds Account (2012)" (the "Bond
Proceeds Account "), which is hereby established as a special account of the Issuer, within
which there shall be a "Refunding Account" for the Refunding and a "Proceeds Account" for
issuance costs and excess proceeds, if any. Moneys in the Bond Proceeds Account shall be used
for the purposes specified in Section 1 of this ordinance (that is, the costs of refinancing the
Project by the Refunding and for the payment of costs of issuance of the Bonds), but may
hereafter be reallocated and used for other lawful purposes in accordance with the Waterworks
and Sewerage Revenue Source Act. Before any such reallocation shall be made, there shall be
requested and filed with the Village Clerk an opinion of Evans, Froehlich, Beth & Chamley,
Champaign, Illinois, or other nationally recognized Bond counsel ( "Bond Counsel ") to the
effect that such reallocation is authorized and will not adversely affect the tax- exempt status of
the Bonds under Section 103 of the Internal Revenue Code of 1986, as amended. Unless directly
applied, including as set forth above, concerning the Refunding and funding of costs of issuance
of the Bonds, moneys in the Bond Proceeds Account shall be withdrawn from time to time as
needed for the payment of costs and expenses incurred or advanced by the Issuer in connection
with the Project or, as approved by a written opinion of Bond Counsel, other authorized System
facilities and for paying the fees and expenses incidental thereto. Moneys shall be withdrawn
from a depositary in connection with such funds from time to time by the Treasurer or other
authorized financial officer of the Issuer only upon submission to such officer of the following:
A duplicate copy of the order signed by the Village President, Village
Administrator or Village Treasurer, or such other officer(s) as may from time to
time be by law authorized to sign and countersign orders of the Issuer, stating
specifically the purpose for which the order is issued and indicating that the
payment for which the order is issued has been approved by the Corporate
Authorities.
Within sixty (60) days after completion of the authorized System facilities the Village President,
or Village Administrator shall certify to the Corporate Authorities the fact that any work has
been completed, and after all costs have been paid, the Village President or Village
Administrator shall execute a completion certificate and file it in the records of the Issuer
certifying that such authorized System facilities have been completed and that all costs have been
paid; and, if at that time any funds remain in the Bond Proceeds Account, the same shall be
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transmitted by the depositary to the Village Treasurer or other authorized financial officer of the
Issuer, and such officer shall credit such funds to the Debt Service Subaccount, or with an
approving written opinion of Bond Counsel, otherwise as the Corporate Authorities direct.
Section 14. Arbitrage Rebate. The Issuer shall comply with the provisions of
Section 148(f) of the Internal Revenue Code of 1986, as amended, relating to the rebate of
certain investment earnings at periodic intervals to the United States of America to the extent
that such compliance is necessary to preserve the exclusion from gross income for federal
income tax purposes of interest on the Bonds under Section 103 of the Internal Revenue Code of
1986, as amended. There is hereby authorized to be created, as necessary, a separate and special
account known as the "Rebate Account ", into which there shall be deposited as necessary
investment earnings to the extent required so as to maintain the tax- exempt status of the interest
on the Bonds under Section 148(f) of the Internal Revenue Code of 1986, as amended. All
rebates, special impositions (such as Yield Reduction Payments) or taxes for such purpose
payable to the United States of America (Internal Revenue Service) shall be payable from
applicable excess earnings or other sources which are to be deposited into the Rebate Account.
Section 15. Investment Regulations. All investments shall be in Qualified
Investments, unless otherwise expressly herein provided. No investment shall be made of any
moneys in the several accounts and subaccounts of the System Fund except in accordance with
the tax covenants and other covenants set forth in Section 16 of this ordinance. All income
derived from such investments in respect of moneys or securities in any fund, account or
subaccount shall be credited in each case to the fund, account or subaccount in which such
moneys or securities are held.
Any moneys in any fund, account or subaccount that are subject to investment
yield restrictions may be invested in United States Treasury Securities, State and Local
Government Series, pursuant to the regulations of the United States Treasury Department,
Bureau of Public Debt. The Issuer's Treasurer and agents designated by such officer are hereby
authorized to submit on behalf of the Issuer subscriptions for such United States Treasury
Securities and to request redemption of such United States Treasury Securities.
Section 16. Non - Arbitrage and Tax- Exemution. 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 Issuer 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
1.148 -0 el seq. of the Income Tax Regulations dealing with 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 registered owners from time to time of the Bonds.
The Corporate Authorities and the Issuer agree, certify, covenant and represent as follows:
(a) The Bonds are being issued to pay the costs of refinancing the Project by the
Refunding and related costs and expenses, and all of the amounts received upon the sale
of the Bonds, plus all investment earnings thereon (the "Proceeds ") are needed for the
purpose for which the Bonds are being issued. The Project immediately commenced
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upon issuance of the Prior Obligations and was diligently completed within 3 years. The
Issuer incurred within 6 months of issuance of the Prior Obligations Project costs in an
amount equal to at least 5% of the Prior Obligation proceeds.
(b) The Issuer immediately proceeded with and diligently concluded the Project,
within the 3 -year temporary period therefor. The Refunding is to be immediately funded
upon issuance of the Bonds.
(c) The Issuer 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 (i)
directly or indirectly to replace funds of the Issuer 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 Issuer. No portion of the Bonds is being issued solely for
the purpose of investing the Proceeds at a Yield higher than the Yield on the Bonds. For
purposes of this Section, "Yield" means that yield (that is, the 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 the purchase price of the Bonds, including accrued interest,
and the purchase price of the Bonds is equal to the first offering price at which more than
10% of the principal amount of each maturity of the Bonds is sold to the public
(excluding bond houses, brokers or similar persons or organizations acting in the capacity
of underwriter or wholesalers).
(d) Net principal proceeds of the Bonds will be applied directly (i) to the
Refunding, (ii) to costs of issuance of the Bonds or (iii) deposited in the Bond Proceeds
Account and used to pay authorized costs and costs of issuance of the Bonds, and any
accrued interest and premium received on the delivery of the Bonds, and other funds of
the Issuer to pay debt service to June 1, 2013, will be deposited in or credited to the Debt
Service Subaccount and used to pay the first interest due on the Bonds. Earnings on the
investment of moneys in any fund, account or subaccount will be credited to that fund,
account or subaccount. Costs of issuance costs of the Bonds may be paid directly upon
issuance of the Bonds or from the Bond Proceeds Account, and no other moneys are
expected to be deposited in the Bond Proceeds Account. Moneys in the Depreciation
Account may be applied to pay debt service on the Bonds in the event there shall be an
insufficiency in the Debt Service Subaccount. However, due to the expected application
of such moneys to pay costs of replacement, repair and extraordinary maintenance of
System facilities, it is unlikely such moneys will be available for such purpose. Interest
on and principal of the Bonds will be paid from the Debt Service Subaccount. No
Proceeds will be used more than 30 days 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 installment contract or other obligation of the Issuer or for the purpose
of replacing any funds of the Issuer used for such purpose.
(e) The Debt Service Subaccount is established to achieve a proper matching of
revenues and earnings with debt service in each bond year. Other than any amounts held
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to pay principal of matured Bonds that have not been presented for payment, it is
expected that any moneys deposited in the Debt Service Subaccount (except the Pledged
Subaccount) will be spent within the 12 -month period beginning on the date of deposit
therein. Any earnings from the investment of amounts in the Debt Service Subaccount
(except the Pledged Subaccount) will be spent within a one -year period beginning on the
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 Debt
Service Subaccount (except the Pledged Subaccount) will be depleted at least once a
year, except for a reasonable carryover amount not to exceed the greater of (i) one -year's
earnings on the investment of moneys in the Debt Service Subaccount (except the
Pledged Subaccount), or (ii) in the aggregate one - twelfth (1 /12th) of the annual debt
service on the Bonds.
(f) Other than the Debt Service Subaccount, 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 matter 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 Issuer to any credit enhancer or liquidity provider.
(g) (i) All amounts on deposit in the Bond Proceeds Account or the Debt Service
Subaccount or the Depreciation Account and all Proceeds, no matter in what funds or
accounts deposited ("Gross Proceeds"), to the extent not exempted in (ii) 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 (f) above, shall be invested at market prices and at a Yield not in
excess of the Yield on the Bonds plus, for amounts in the Bond Proceeds Account after
the three -year temporary period, but only as expected to be applied to authorized System
facilities and related costs, 1/8 of 1 %, and within such three -year temporary period
without restrictions.
(ii) The following may be invested without Yield restriction:
(A) amounts invested in obligations described in Section 103(a) of the
Internal Revenue Code of 1986, as amended (but not specified private activity
bonds as defined in Section 57(a)(5)(C) of the Code), the interest on which is not
includable in the gross income of any registered owner thereof for federal income
tax purposes ( "Tax- Exempt Obligations ");
(B) amounts deposited in the Debt Service Subaccount that are reasonably
expected to be expended within 13 months. from the deposit date and have not
been on deposit therein for more than 13 months;
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(C) amounts, if any, in the Bond Proceeds Account to be applied to
System improvements prior to the earlier of completion (or abandonment) of such
improvements or three years from the date of issue of the Bonds;
(D) an amount not to exceed 5% of Bond proceeds;
(E) all amounts for the first 30 days after they become Gross Proceeds
(e.g., date of deposit in any fund, account or subaccount securing the Bonds); and
(F) all amounts derived from the investment of Proceeds for a period of
one year from the date received.
(h) Subject to (q) below, once moneys are subject to the Yield limits of (g)(i)
above, such moneys. remain Yield restricted until they cease to be Gross Proceeds.
(i) As set forth in Section 148(f)(4)(D) of the Internal Revenue Code of 1986, as
amended, the Issuer is excepted from the required rebate of arbitrage profits on the Bonds
because the Issuer is a governmental unit with general taxing powers, none of the Bonds
is a "private activity bond" as defined in Section 139(a) of the Internal Revenue Code
of 1986, as amended, all the net proceeds of the Bonds are to be used for the local
government activities of the Issuer, and the aggregate face amount of all tax- exempt
obligations (including "qualified 501(c)(3) bonds" and excluding other than "private
activity bonds" as defined in Internal Revenue Code of 1986, as amended) issued by the
Issuer and all subordinate entities thereof during the calendar year in which the Bonds are
to be issued, including the Bonds, is reasonably expected to exceed $5,000,000 under
such Section 148(f)(4)(D). In this connection, and as to Yield Reduction Payments, as
applicable, the Issuer will execute an Arbitrage Regulation Agreement, as applicable, and
not otherwise.
0) None of the Proceeds 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.
(k) The payment of the principal of or the interest on the Bonds 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 Issuer), 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.
(1) None of the Proceeds will be used, directly or indirectly, to make or finance
loans to persons other than a state or local governmental unit.
(m) No user of the Project other than a state or local government unit will use the
Project 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 Project as a result of (i)
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ownership, or (ii) actual or beneficial use pursuant to a lease or a management or
incentive payment contract, or (iii) any other similar arrangement.
(n) Beginning on the 15th day prior to the Bond sale date, the Issuer has not sold
or delivered, and will not sell or deliver, (nor will it deliver within 15 days after the date
of issuance 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 Proceeds.
(o) No portion of the Project is expected to be sold or otherwise disposed of prior
to the last maturity of the Bonds.
(p) The Issuer 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 the Regulations.
(q) The Yield restrictions contained in (g) above or any other restriction or
covenant contained herein need not be observed and may be changed if the Issuer
receives an opinion of Bond Counsel to the effect that such non - observance or change
will not adversely affect the tax- exempt status of interest on the Bonds to which the
Bonds otherwise are entitled.
(r) The Issuer 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 Bond Counsel should be contacted if such changes do
occur.
(s) 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 private activity bonds, arbitrage bonds or hedge bonds within
the meaning of Sections 139, 148 or 149(8) of the Internal Revenue Code of 1986, as
amended, and of applicable 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 Issuer also agrees and covenants with the registered owners of the Bonds from time to time
outstanding that, to the extent possible under Illinois law, it will comply with all present federal
tax law and related regulations and with whatever federal tax law is adopted and regulations
promulgated in the future which apply to the Bonds and affect the tax - exempt status of the
Bonds.
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Section 17. Further Assurances and Actions. The Corporate Authorities
hereby authorize the officials of the Issuer responsible for issuing the Bonds, the same being the
Village President, Village Administrator, Village Clerk and Village Treasurer of the Issuer, to
make such further filings, covenants, certifications and supplemental agreements as may be
necessary to assure that the use of the Project and the Bonds and related proceeds will not cause
the Bonds to be private activity bonds, arbitrage bonds or hedge bonds and to assure that the
interest on the Bonds will be excluded from gross income for federal income tax purposes. In
connection therewith, the Issuer and the Corporate Authorities further agree: (i) through the
officers of the Issuer, to make such further specific covenants, representations as shall be true,
correct and complete, and assurances as may be necessary or advisable; (ii) to consult with Bond
Counsel approving the Bonds and to comply with such advice as may be given; (iii) to pay to the
United States, as necessary, such sums of money representing required rebates of excess
arbitrage profits relating to the Bonds; (iv) to file such forms, statements, and supporting
documents as may be required and in a timely manner; and (v) if deemed necessary or advisable,
to employ and pay fiscal agents; financial advisors, attorneys, and other persons to assist the
Issuer in such compliance, and (vi) to abate in whole or in part levied Pledged Taxes.
An Insurer's commitment with respect to a Policy and the terms and provisions of
the Policy are hereby incorporated into this ordinance by this reference, as if set out in full at this
place, including without limitation that any investment restrictions and limitations in the
commitment and related to the Policy shall be deemed to be applicable restrictions and
limitations on the investments authorized by this ordinance. A copy of the Insurer's commitment
and standard package shall be attached to this ordinance, but any failure to so attach shall not
abrogate, diminish or impair the effect thereof. In the event there is no Insurer or Policy, the
reference herein to an Insurer or a Policy shall be given no effect.
Section 18. General Covenants. The Issuer covenants and agrees with the
registered owners of the Outstanding Bonds, so long as there are any Outstanding Bonds (as
defined herein), as follows:
(a) The Issuer will take all action necessary to impose, levy, collect, receive and
apply the applicable Pledged Revenues and Pledged Taxes, in each case in the manner
contemplated by this ordinance and that such Pledged Revenues are to be deposited into
the Debt Service Subaccount and shall not be less than as shall be required under Section
15 of the Local Government Debt Reform Act to maintain the Bonds as Alternate Bonds.
(b) The Issuer covenants that it will, while any of the Bonds shall remain
outstanding, apply System revenues and charge rates and fees for usage of the System,
sufficient (together with other applicable Pledged Revenues) to provide for or pay each of
the following in any given year: (1) cost of operation and maintenance of the System
(but not including depreciation); (2) debt service on all outstanding revenue bonds
payable from Pledged Revenues; (3) all amounts required to meet any fund or account
requirements with respect to the Bonds or any other bonds payable from Pledged
Revenues of the System; (4) other contractual or tort liability obligations, if any, payable
from Pledged Revenues; and (5) in each year, an amount not less than 1.25 times the debt
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service for all (i) alternate bonds payable from Pledged Revenues, including any
previously issued and outstanding; and (ii) alternate bonds proposed to be issued and
payable from one or more of the sources of Pledged Revenues, including the Bonds.
(c) Whenever the 125% coverage in subsection (b) above is not effected (and at
least 100% from Net Revenues) or the Bonds at any time fail to qualify as Alternate
Bonds not subject to any applicable debt limit under Section 15 of the Local Government
Debt Reform Act or Pledged Taxes are extended and collected as in Section 10 hereof,
the Issuer covenants to promptly have prepared a financial analysis of the System and the
Pledged Revenues by an independent consulting accountant or other qualified
professional employed for that purpose, and further, to send a copy of such analysis,
when completed, upon request to the Underwriter of the Bonds along with a letter
indicating what action the Issuer has taken responsive to such study and to comply with
Section 15 of the Loral Government Debt Reform Act.
(d) The Issuer will make and keep proper books and accounts (separate and apart
from all other records and accounts of the Issuer), in which complete entries shall be
made of all transactions relating to the Pledged Revenues and the operation of the
System, and hereby covenants that within ninety (90) days following the close of each
Fiscal Year, it will cause the books and accounts related to the Pledged Revenues and the
System to be audited by independent certified public accountants. Such audit will be
available for inspection by the owners of any of the Bonds. Upon availability, the Issuer
will send the Purchaser a copy of such audit and of its general audit in each year. 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:
(i) A balance sheet as of the end of such Fiscal Year, including a statement
of the amount held in each of the accounts under this ordinance.
(ii) A list of all 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.
(iii) The amount and details of all Outstanding Bonds.
(iv) The accountant's comments regarding the manner in which the Issuer
has carried out the accounting requirements of this ordinance (including as to the
Alternate Bond Status of the Bonds) and has complied with Section 15 of the Local
Government Debt Reform Act, and the accountant's recommendations for any changes.
It is further covenanted and agreed that a copy of each such audit shall be furnished upon
completion to the Purchaser, and a summary thereof shall be furnished to the registered
owner of any Bond upon request.
(e) The Issuer will keep its books and accounts in accordance with generally
accepted fund reporting practices for local government entities and enterprise funds;
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provided, however, that the monthly credits to the Debt Service Subaccount shall be in
cash, and such 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, investments shall be valued
at the lower of the cost or market price on the valuation date thereof, which valuation
date shall be not less frequently than annually.
(f) The Issuer will take no action in relation to the Pledged Revenues or the
Pledged Taxes which would unfavorably affect the security of the Outstanding Bonds or
the prompt payment of the principal and interest thereon or the 125% coverage required
in subsection (b) above to maintain the Bonds as "alternate bonds" under Section 15 of
the Local Government Debt Reform Act.
(g) The owner of any Bond may proceed by civil action to compel performance of
all duties required by law and this ordinance.
(h) The Issuer will adopt a budget for the System prior to the beginning of each
Fiscal Year, subject to all applicable state laws, providing for payment of all sums to be
due in the Fiscal Year so as to comply with the terms of this ordinance. The budget may
include in its estimate of income the use of available surplus moneys or other funds of the
Issuer appropriated for such purposes. If during the Fiscal Year there are extraordinary
receipts or payments of unusual cost, the Issuer will adopt an amended budget for the
remainder of the Fiscal Year, providing for receipts or payments pursuant to this
ordinance.
(i) The Issuer will carry insurance on the System of the kinds and in the amounts
which are usually carried by private parties operating similar properties, covering such
risks as shall be recommended by a competent consulting engineer or insurance
consultant employed by the Issuer for the purpose of making such recommendations. All
moneys received for loss under such insurance policies shall be deposited in a separate
subaccount of the Bond Proceeds 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 making good such loss or
damage shall be made within ninety (90) days from the date of the loss. The payment of
premiums for all insurance policies required under the provisions of this covenant in
connection with the System shall be considered an Operation and Maintenance Expense.
The proceeds derived from any and all policies for workers' compensation or
public liability shall be paid into a separate subaccount of the Operation and Maintenance
Account and used in paying the claims on account of which they were received.
6) The Issuer will comply with the special covenants concerning Alternate Bonds
as required by Section 15 of the Local Government Debt Reform Act and Section 15 of
this ordinance.
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(k) The Issuer will preserve and protect the security of the Bonds and the rights
of the registered owners of the Bonds, and will warrant and defend their rights against all
claims and demands of all persons.
(1) After their issuance, to the extent lawful the Bonds shall be incontestable by
the Issuer.
Section 19. Ordinance to Constitute a Contract. The provisions of this
ordinance shall constitute a contract between the Issuer and the registered owners of the Bonds.
Any pledge made in this ordinance and the provisions, covenants and agreements herein set forth
to be performed by or on behalf of the Issuer shall be for the equal benefit, protection and
security of the registered owners of any and all of the Bonds. All of the Bonds, regardless of the
time or times of their issuance, shall be of equal rank without preference, priority or distinction
of any of the Bonds over any other thereof except as expressly provided in or pursuant to this
ordinance. This ordinance shall constitute full authority for the issuance of the Bonds, and to the
extent that the provisions of this ordinance conflict with the provisions of any other ordinance or
resolution of the Issuer, the provisions of this ordinance shall control.
Section 20. Severability and No Contest. If any section, paragraph or provision
of this ordinance shall be held to be invalid or unenforceable for any reason, the invalidity or
unenforceability of such section, paragraph or provision shall not affect any of the remaining
provisions of this ordinance. Upon the issuance of the Bonds, neither the Bonds nor this
ordinance, to the extent lawful, shall be subject to contest by or in respect of the Issuer.
Section 21. Bank Qualified Bonds. Pursuant to Section 265(b)(3) of the
Internal Revenue Code of 1986, as amended, the Issuer hereby designates the Bonds as
"qualified tax - exempt obligations" as defined in Section 265(b)(3) of the Internal Revenue
Code of 1986, as amended. The Issuer represents that the reasonably anticipated amount of tax -
exempt obligations that will be issued by the Issuer and all subordinate entities of the Issuer
during the calendar year in which the Bonds are to be issued will not exceed $10,000,000 within
the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. The Issuer
covenants that it will not so designate and issue more than $10,000,000 aggregate principal
amount of tax- exempt obligations in such calendar year. For purposes of this Section, the term
"tax - exempt obligation" includes "qualified 501(c)(3) Bonds" (as defined in the Section 145
of the Internal Revenue Code of 1986, as amended) but does not include other "private activity
bonds" (as defined in Section 141 of the Internal Revenue Code of 1986, as amended).
Section 22. Reveal. All ordinances, resolutions or parts thereof in conflict
herewith shall be and the same are hereby repealed to the extent of such conflict and this
ordinance shall be in full force and effect forthwith upon its adoption.
Section 23. Effective Date. This ordinance shall become effective immediately
upon its passage and approval in the manner provided by law, and upon its becoming effective
and prior to the issuance of the Bonds a certified copy of this ordinance shall be filed with the
County Clerk of each of Cook, DuPage and Will Counties, Illinois.
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Upon motion by Trustee h� seconded by Trustee
S G adopted this day of L(S _, 2012, by roll call vote as
follow
Ayes (Names):
Nays (Names):
Absent (Names):
ATTEST:
Village Clerk
(SEAL)
_;�_
APPROVED: � 2012
illage President
STATE OF ILLINOIS )
THE COUNTY OF COOK ) SS.
VILLAGE OF LEMONT )
CERTIFICATION OF ORDINANCE
1, the undersigned, do hereby certify that I am the duly selected, qualified and acting Village
Clerk of the Village of Lemont, Cook, DuPage and Will Counties, Illinois (the "Issuer "), and as such
official I am the keeper of the records and files of the Issuer and of its President and Board of Trustees
(the "Corporate Authorities ").
I do further certify that the foregoing constitutes a full, true and complete excerpt from the
proceedings of a regular meeting of the Corporate Authorities held on the .2T day of Aimar4 ,
2012, insofar as same relates to the adoption of Ordinance No. f -6y f/2 , entitled:
AN ORDINANCE AUTHORIZING THE ISSUANCE OF GENERAL
OBLIGATION WATERWORKS AND SEWERAGE REFUNDING BONDS
(ALTERNATE REVENUE SOURCE), SERIES 2012C, OF THE VILLAGE OF
LEMONT, COOK, DUPAGE AND WILL COUNTIES, ILLINOIS, PROVIDING
THE DETAILS OF SUCH BONDS AND FOR ALTERNATE REVENUE
SOURCES AND THE LEVY OF DIRECT ANNUAL TAXES SUFFICIENT TO
PAY THE PRINCIPAL OF AND INTEREST ON SUCH BONDS, AND RELATED
MATTERS,
a true, correct and complete copy of which ordinance (the "Ordinance ") as adopted at such meeting
appears in the transcript of the minutes of such meeting and is hereto attached. The Ordinance was
adopted and approved by the vote and on the date therein set forth.
I do further certify that the deliberations of the Corporate Authorities on the adoption of
such Ordinance were taken openly, that the adoption of such Ordinance was duly moved and seconded,
that the vote on the adoption of such Ordinance was taken openly and was preceded by 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, that such meeting was held at a specified time and place convenient to the
public, that the agenda for the meeting was duly posted on the Issuer's website and at the Village Hall at
least 48 hours prior to the meeting, that notice of such meeting was duly given to all of the news media
requesting such notice, that such meeting was called and held in strict compliance with the provisions of
the open meeting laws of the State of Illinois, as amended, and the Illinois Municipal Code, as amended,
and that the Corporate Authorities have complied with all of the applicable provisions of such open
meeting laws and such Code and their procedural rules in the adoption of such Ordinance.
IN WITNESS WHEREOF, I hereunto affix my official t cial signs ure and the seal of the
^
Village of Lemont, Cook, DuPage and Will Counties, Illinois, this �L day ofAU 2012.
(SEAL)
(;,/k� k
Village Clerk